Last week, the Washington, DC office of Pike Research attended the Department of Energy’s Hydrogen and Fuel Cells Program and Vehicle Technologies Program Annual Merit Review and Peer Evaluation Meeting. During this year’s plenary session, I got to hear more about the funding specifics of the Vehicle Technologies program. One of the programs within Vehicle Technologies that struck me was the Fuels Technology subprogram.
First, I should summarize the Vehicle Technologies program and how the Fuels Technology subprogram fits within it. As summarized by the DOE website, “The Vehicle Technologies Program is developing more energy efficient and environmentally friendly highway transportation technologies that will enable America to use less petroleum. The long-term aim is to develop “leap frog” technologies that will provide Americans with greater freedom of mobility and energy security, while lowering costs and reducing impacts on the environment.” The VTP hits on the trifecta of new energy: less petroleum, lower costs, and less impact on the environment. Of course, being more efficient with a scarce resource is the easiest route and several subprograms, including the Fuels Technology subprogram, address efficiency.
In line with the VTP mission, the Fuels Technology subprogram is also summarized by the DOE, “The fuels and lubricants effort supports research and development to provide vehicle users with fuel options that are cost-competitive, enable high fuel economy, deliver lower emissions, and contribute to petroleum displacement. Activities aim to identify advanced petroleum-based fuels and nonpetroleum-based fuels and lubricants for more energy-efficient and environmentally friendly highway transportation vehicles that can displace petroleum fuels.” I think everyone would agree these are important goals.
I was surprised that the DOE was funding fuels technology, not because it is unworthy, but rather an issue for industry not government. I understand how the DOE would be interested in testing and verifying fuels and lubricants, but funding the actual research and development seems like a poor use of scarce government R&D dollars. It would be more efficient for the federal government to issue efficiency standards, leaving the fuel vendors to find funding. This is logical because fuels and lubricants for internal combustion engines are not disruptive technologies. We’ve been driving and fuelling ICE vehicles for over 100 years. There is nothing remarkable about ICE vehicles or the fuels and lubricants these vehicles consume.
Moreover, oil companies have the resources to undertake this type of research. I am certain that many (if not all) fuel vendors, such as Shell, have fuels and lubricants R&D programs with similar if not identical goals. The total budget for the Fuels Technology program in FY2009 was $20.122 million. That is a lot of money to spend on an existing product when vendors are performing the same research.
In my opinion, agencies such as the DOE primarily exist to fund research that is in too early a stage to receive serious industry funding. That is not the case with fuels and lubricants. A simpler way to ensure efficiency and get cost-competitive, high fuel economy, lower emissions fuels and vehicles is mandating these characteristics to fuel vendors, not necessarily undertaking research in parallel.