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Clean technology in 2012: five trends

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Science and entrepreneurship at the leading edge of the energy industry is alive and well. Plus, four more lessons from the 2012 ARPA-E Energy Innovation Summit.

NATIONAL HARBOR, Md. -- Here at the 2012 ARPA-E Energy Innovation Summit, it's safe to say that the energy was positive.

The conference, held this week and organized by the U.S. Department of Energy's research arm, brings together the movers and shakers in clean-energy technologies who are trying to take inventions from research labs and make them viable commercial products. This year's summit was the third.

So far, no startups that received government grants have gone on to become the Google or Apple of clean technology -- yet. But it is clear that ARPA-E, which operates with a $180 million budget this year, has had a big impact on entrepreneurship by setting a high bar for technical performance and asking technologists to think big.

Five trends from this year's conference:

1.) It's all about the research. A walk through the showcase of ARPA-E grant winners and applicants quickly demonstrates how active research is on ground-breaking ideas.

How about manufacturing vehicle fuels with microbes fed only carbon dioxide, sun and electricity? There's a whole program for that called Electrofuels. There's clear progress on batteries with one ARPA-E funded company claiming batteries that can delivery 300 miles of range on electric car. One startup plans to store energy with molten glass, a something it hopes to will allow for round-the-clock power delivery from solar power plants.

There are also many startups and research organizations pursuing less radical ideas, focused instead on applying existing technology or improving energy efficiency. The Army, for example, had a display on how they are equipping soldiers in the field with solar packs and portable power systems. Others are developing the materials for electronics needed to improve the efficiency of transferring power around the grid. The latest ARPA-E funding program will be using cheap natural gas for vehicles or chemicals.

2.) Entrepreneurs are getting smarter. Entrepreneurship in energy is relatively new compared to information technology or life sciences and people are learning from their own and others' mistakes--and not just Solyndra.

I ran into the CEO of Liquid Metal Battery, a company spun out of the Massachusetts Institute of Technology and partially funded by Bill Gates. With the basic science understood, the challenge is to develop a product with commercial appeal, a position many energy and materials startups are in. The company is taking a methodical approach, building larger and larger prototypes and, no doubt, seeking the contacts it needs to manufacture and test its low-cost and long-lasting battery with utilities.

Overall, there seems to be a recognition that innovating in the "hard sciences" is, well, hard and takes a lot of time and money. Even though many clean-energy start-ups have died and will die, there's a valuable upside in seasoned entrepreneurs.

3.) Computing (and information technology) play a huge role in clean energy. Oddly enough, a panel on the smart grid "beyond the smart meter" focused almost exclusively on information technology.

It's not hard to understand why when you consider that there are already 30 million digital devices on the U.S. grid in the form of smart meters, relays, and line sensors, according to the Electric Power Research Institute (EPRI). Those sensors are creating mountains of data which utilities need to effectively make use of to recoup those technology investments, according to panelists.

One of the biggest challenges is organizational, which is a classic business technology problem.

Historically, different groups within utilities had their own data silos but effective sharing can improve service and bring home the benefits of the smart grid to consumers, said Arshad Mansoor, senior vice president of research and development at EPRI. For example, utilities could use smart meter data to isolate the location of power outages and better dispatch repair crews.

Even in world of biology and energy, IT is something of a bottleneck. Sequencing genomes is giving biologists incredibly powerful tools for genetically engineering synthetic organisms. The sheer amount of data and the need for stronger computational tools is causing concern among researchers. "In many ways, we run the risk of losing a lot of data simply because many bioinformatics systems will not be viable and the software systems are not agile enough," said Aristides Patrinos, senior vice president of corporate affairs of Synthetic Genomics during a panel on biology and energy.

4.) Big companies are required. Great technology often doesn't make it out of the labs and beyond the prototype phase. Many energy inventions wither through the dreaded "Valley of Death" as companies simply run out of money to demonstrate a technology at large scale and earn revenue. The most recent example is electric vehicle company Bright Automotive, which was unable to get government funding for a factory, closed down yesterday.

Another route many companies is taking is "strategic partners," or partnering with big companies with the wherewithal to make and potentially test out new products. Solar companies HelioVolt and Stion brought in investments from Korean manufacturers which, in addition to money, give them access to needed manufacturing expertise.

Large corporations are customers, too. At the conference, former Walmart CEO Lee Scott and FedEx CEO Fred Smith talked about taking the lead on energy products, which they viewed as long-term strategic bets.

5.) Lots of promise, but funding remains uncertain. The ARPA-E conference is a way to showcase the interesting research underway both to scientists and entrepreneurs, but also to politicians. The Department of Energy is requesting a significant bump in the budget of ARPA-E which is questionable because of federal budget woes and political attacks on the Obama administration's energy policies.

In an interview, Energy secretary Steven Chu said there is strong support in Congress for ARPA-E and members from both parties gave speeches at the conference to voice their support. Meanwhile, Bill Gates at ARPA-E made the argument that the budget for clean-energy research should be at least twice what it is now. "It's crazy how little we're funding this energy stuff," he said.

Many energy startups have said that getting federal grants for specific projects helped bring investment from private companies because the startups needed to go through a rigorous evaluation process. Coming up with a compelling clean-energy product doesn't guarantee commercial success but, in a world that increasingly resource-constrained, there's clearly a need and a market for energy innovation.

The original version of this post first appeared on CNET's Green Tech blog.

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Martin LaMonica

Contributing Writer

Martin LaMonica was a CNET senior writer covering green tech and cutting-edge technologies. He joined CNET in 2002 to cover enterprise IT and Web development and was previously executive editor of IT publication InfoWorld. Disclosure