[House Hearing, 115 Congress]
[From the U.S. Government Publishing Office]


                           ENERGY INNOVATION:
                        LETTING TECHNOLOGY LEAD

=======================================================================

                                HEARING

                               BEFORE THE

              COMMITTEE ON SCIENCE, SPACE, AND TECHNOLOGY
                        HOUSE OF REPRESENTATIVES

                     ONE HUNDRED FIFTEENTH CONGRESS

                             FIRST SESSION

                               __________

                             JULY 19, 2017

                               __________

                           Serial No. 115-23

                               __________

 Printed for the use of the Committee on Science, Space, and Technology
 
 
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              COMMITTEE ON SCIENCE, SPACE, AND TECHNOLOGY

                   HON. LAMAR S. SMITH, Texas, Chair
FRANK D. LUCAS, Oklahoma             EDDIE BERNICE JOHNSON, Texas
DANA ROHRABACHER, California         ZOE LOFGREN, California
MO BROOKS, Alabama                   DANIEL LIPINSKI, Illinois
RANDY HULTGREN, Illinois             SUZANNE BONAMICI, Oregon
BILL POSEY, Florida                  ALAN GRAYSON, Florida
THOMAS MASSIE, Kentucky              AMI BERA, California
JIM BRIDENSTINE, Oklahoma            ELIZABETH H. ESTY, Connecticut
RANDY K. WEBER, Texas                MARC A. VEASEY, Texas
STEPHEN KNIGHT, California           DONALD S. BEYER, JR., Virginia
BRIAN BABIN, Texas                   JACKY ROSEN, Nevada
BARBARA COMSTOCK, Virginia           JERRY MCNERNEY, California
BARRY LOUDERMILK, Georgia            ED PERLMUTTER, Colorado
RALPH LEE ABRAHAM, Louisiana         PAUL TONKO, New York
DRAIN LaHOOD, Illinois               BILL FOSTER, Illinois
DANIEL WEBSTER, Florida              MARK TAKANO, California
JIM BANKS, Indiana                   COLLEEN HANABUSA, Hawaii
ANDY BIGGS, Arizona                  CHARLIE CRIST, Florida
ROGER W. MARSHALL, Kansas
NEAL P. DUNN, Florida
CLAY HIGGINS, Louisiana
RALPH NORMAN, South Carolina
                            
                            
                            C O N T E N T S

                             July 19, 2017

                                                                   Page
Witness List.....................................................     2

Hearing Charter..................................................     3

                           Opening Statements

Statement by Representative Lamar S. Smith, Chairman, Committee 
  on Science, Space, and Technology, U.S. House of 
  Representatives................................................     4
    Written Statement............................................     6

Statement by Representative Eddie Bernice Johnson, Ranking 
  Member, Committee on Science, Space, and Technology, U.S. House 
  of Representatives.............................................     9
    Written Statement............................................    11

                               Witnesses:

Dr. Jacob DeWitte, President and CEO, Oklo
    Oral Statement...............................................    13
    Written Statement............................................    16

Dr. Gaurav N. Sant, Associate Professor and Henry Samueli Fellow, 
  Department of Civil and Environmental Engineering, Henry 
  Samueli School of Engineering and Applied Science, University 
  of California, Los Angeles (UCLA)
    Oral Statement...............................................    24
    Written Statement............................................    27

Dr. Venky Narayanamurti, Benjamin Peirce Research Professor of 
  Technology and Public Policy, John A. Paulson School of 
  Engineering and Applied Sciences, Harvard University
    Oral Statement...............................................    31
    Written Statement............................................    33

Mr. Kiran Kumaraswamy, Market Development Director, AES Energy 
  Storage
    Oral Statement...............................................    45
    Written Statement............................................    47

Discussion.......................................................    56

             Appendix I: Answers to Post-Hearing Questions

Dr. Venky Narayanamurti, Benjamin Peirce Research Professor of 
  Technology and Public Policy, John A. Paulson School of 
  Engineering and Applied Sciences, Harvard University...........    86

 
               ENERGY INNOVATION: LETTING TECHNOLOGY LEAD

                              ----------                              


                         Tuesday, July 19, 2017

                  House of Representatives,
               Committee on Science, Space, and Technology,
                                                   Washington, D.C.

    The Committee met, pursuant to call, at 10:09 a.m., in Room 
2318 of the Rayburn House Office Building, Hon. Lamar Smith 
[Chairman of the Committee] presiding.
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    Chairman Smith. The Committee on Science, Space, and 
Technology will come to order.
    Without objection, the Chair is authorized to declare 
recesses of the Committee at any time.
    And welcome to today's hearing titled ``Energy Innovation: 
Letting Technology Lead.'' I'll recognize myself for an opening 
statement and then the Ranking Member for her opening 
statement.
    Today we will hear from a panel of private sector 
innovators who are inventing the way to bring next-generation 
technology to the energy market. New technology provides 
solutions to today's energy and environmental challenges. 
Instead of government mandates, more regulations, and higher 
energy taxes, the federal government should invest in the 
research that allows innovative technology like advanced 
nuclear power and energy storage to succeed. We should all 
agree on these technology-driven energy solutions.
    Unfortunately, nuclear power, which is the only reliable 
emissions-free source of electricity, is still criticized by 
environmental activists today. Those who are sincerely 
interested in solving some of America's environmental 
challenges should endorse and promote these critical new 
technologies.
    This hearing will consider the value of federally funded 
basic and early-stage research as well as the research 
infrastructure at universities and national labs. These 
investments provide valuable expertise that would otherwise be 
unavailable to industry.
    The Science Committee has jurisdiction over the $9 billion 
R&D portfolio at the Department of Energy, which funds basic 
science and energy research. Fundamental research conducted by 
the DOE Office of Science has led to groundbreaking discoveries 
about our universe, innovative new technologies, and private 
sector achievements across the energy and manufacturing 
industries.
    Much of the technology we will hear about today is rooted 
in the basic science discoveries made at DOE national labs. 
Industry can build on these early-stage research discoveries, 
and use research infrastructure to create market-ready, next-
generation energy technologies. For example, Dr. Jacob DeWitte, 
who started his career as an intern at Sandia National Lab, is 
the Co-Founder of Oklo, a privately funded startup company 
working to commercialize a small advanced nuclear reactor 
design. Dr. DeWitte's compact fast reactor design is ideal to 
replace the diesel generators used in rural areas, industrial 
operations, or even on military bases.
    This reactor was developed using early-stage nuclear energy 
research conducted by DOE national labs. It will have zero 
emissions and could lower costs for consumers by up to 90 
percent. If environmentalists are serious about reducing 
emissions, they should champion advanced nuclear reactors as an 
essential part of a clean energy future.
    At UCLA, Dr. Gaurav Sant and his team have used basic 
research in chemistry, materials science, engineering, and 
high-performance computing to design a technology that converts 
carbon dioxide into a cement-like material. This technology 
could take captured carbon dioxide from power plants and turn 
it into a usable, cost-effective material. This innovative 
technology has the potential to revolutionize the market for 
CO2, turning a waste product into profit.
    Even large companies can benefit from basic research. AES 
Energy Storage is revolutionizing renewable energy through the 
deployment of batteries for the electric grid. AES's most 
recent project in California is capable of storing up to 120 
megawatt hours of energy produced by wind and solar power. This 
is the energy equivalent of serving 20,000 customers for four 
hours. Basic and early-stage research in electrochemistry can 
improve the efficiency and resiliency of the thousands of 
batteries used in these facilities.
    This Committee authorized exactly this kind of basic and 
fundamental research in the DOE Research and Innovation Act, 
which passed the House earlier this year. Enabling these 
private sector innovators to develop the most competitive ideas 
is essential to groundbreaking energy technology. If we want to 
protect the environment, lower costs for consumers, and 
increase our energy potential, innovative technology is the 
solution.
    And note that during the White House Made in America week, 
we have three American companies testifying on innovative 
technology.
    By allowing the market, not the government, to determine 
the best approach, we can develop technology that will increase 
energy efficiency, reduce environmental impact, and save the 
American people money.
    America's energy history is full of innovative technologies 
that have unlocked new possibilities. It is technology, not 
regulation, that improves efficiency, lowers costs, and reduces 
the environmental impact of all kinds of energy.
    For too long the government has picked winners and losers 
through regulation, federal loans and loan guarantees, or 
market-distorting subsidies. It is time to let the scientists, 
researchers, engineers, and inventors ensure that the United 
States remains the world technology leader and is better able 
to address environmental concerns.
    As we shape the future of the Department, our priority must 
be basic energy research and development that only the federal 
government has the resources to pursue. This will allow private 
sector innovators, like the witnesses who join us today, to 
take groundbreaking energy technology to the marketplace, 
creating jobs and growing our economy.
    [The prepared statement of Chairman Smith follows:]
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    Chairman Smith. That concludes my opening statement, and 
the gentlewoman from Texas, the Ranking Member, is recognized 
for hers.
    Ms. Johnson. Thank you very much, Mr. Chairman, and thank 
you for holding this hearing. I'd like to thank all of our 
witnesses for being here today.
    In years past, this Committee would hold an annual hearing 
on the Administration's budget proposal for the Department of 
Energy, and I would typically begin my remarks with a few brief 
reminders of how government-supported energy research can pay 
off, ranging from the birth of the nuclear power industry to 
the shale gas revolution. I'd then move on to provide my views 
on what usually was a thoughtful, well-crafted budget proposal, 
even if I might have had some disagreements with it.
    Unfortunately, this is not a typical year. First, while the 
Administration's budget blueprint was released back in March 
and its detailed budget request was released in May, our 
Committee has still not yet scheduled a hearing with Secretary 
Perry testifying to explain and defend his proposal.
    While the panel before us today has a broad and impressive 
range of expertise that will at least enable us to begin this 
discussion, none of these witnesses can speak for the 
Department. In order for this Committee to fulfill its 
oversight responsibilities, I urge the Chairman to schedule a 
hearing with the Secretary as soon as possible.
    As for the fiscal year DOE budget request, I want to be 
clear: I am deeply disturbed by the Trump Administration's 
proposed budget for the Department of Energy. It would 
completely eliminate ARPA-E, an agency that has already 
demonstrated incredible success in advancing high-risk, high-
reward energy technology solutions that neither the public nor 
the private sector had been willing or able to support in the 
past. This accomplishment was highlighted in a congressionally 
mandated National Academies review of the agency released just 
last month. Bipartisan industry leaders like Norm Augustine and 
Bill Gates have repeatedly called for tripling this agency's 
budget given the unique role that it is now playing in our 
energy innovation pipeline.
    And I'd be remiss if I didn't refer my colleagues to 
Secretary Perry's March 8th tweet, issued just eight days 
before the budget blueprint was released, which states, and I 
quote, ``Innovators like the ones supported by our ARPA-E 
program are key to advancing America's energy economy.'' I 
really couldn't have said it any better.
    In addition, the President's budget proposal would 
eliminate DOE's loan guarantee and Advanced Vehicle Technology 
Manufacturing programs. Mr. Chairman, we just held a hearing on 
these programs a few months ago, and we learned that their 
record of accomplishment more than justifies our continued 
support. The DOE Loan Programs Office has been instrumental in 
launching the utility-scale PV industry, Tesla Motors, the 
construction of our first new nuclear reactors in 30 years, and 
it is now supporting the commercialization of new carbon 
capture and reuse technologies. Overall, the Loan Office's 
losses are only about two percent of its entire portfolio, a 
rate that is lower than many venture capitalists achieve. And 
even after accounting for those losses, the interest payments 
from these loans and loan guarantees have returned over $1 
billion to the Treasury. If we're aiming to create jobs and 
reduce the deficit, these are exactly the programs we should be 
supporting.
    Finally, the budget proposal would slash the Department's 
other critical energy technology offices for energy efficiency, 
renewables, the grid, fossil energy, and nuclear energy by $2.3 
billion overall, or about 57 percent. And it would cut the DOE 
Office of Science, the largest supporter of physical sciences 
research in the country, by over $900 million, or 17 percent.
    Our national infrastructure for scientific and energy 
research would be irreparably harmed if these cuts were 
actually implemented.
    Now, I'm not going to tell you that every program the 
Department currently implements is perfect, that reforms should 
never be considered, or that reasonable people can't simply 
disagree on the best way to allocate its resources even after a 
careful, rigorous review.
    One of my largest concerns now, especially given the 
incredibly severe damage that this proposal would impose on our 
entire research enterprise, is that such a thoughtful review 
never actually took place before this budget proposal was 
released. In fact, last month Administration officials 
confirmed that there was no engagement with the private sector 
at all to determine what industry would be able or willing to 
fund in the absence of federal investment. This is simply 
unacceptable.
    In closing, I hope that we can all take a step back and 
more carefully consider the direction we want to move the 
Department in over the next several years.
    I look forward to the hearing and listening to our 
witnesses on all of these critical issues. I yield back 
whatever balance of time I have.
    [The prepared statement of Ms. Johnson follows:]
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    Chairman Smith. Well, actually there's not much balance 
left but I appreciate the gentlewoman yielding back, and thank 
you for your statement.
    Before I introduce our witnesses today, I'd like to 
introduce the newest member of the Science Committee, Ralph 
Norman of South Carolina. Having served as a former state rep 
in South Carolina, he brings a wealth of experience to the 
Committee, and he's going to be serving on the Environment and 
Oversight Subcommittees, and Ralph, we welcome you to the 
Committee.
    And I'll go to our witnesses. Our first witness today is 
Dr. Jacob DeWitte, Co-Founder and CEO of Oklo. Previously, Dr. 
DeWitte worked at Sandia National Lab, Urenco U.S., and the 
Naval Reactor Research Laboratories. He studied nuclear 
engineering at the University of Florida and received his Ph.D. 
in nuclear engineering from MIT.
    Our next witness is Dr. Gaurav N. Sant, Associate Professor 
and Henry Samueli Fellow in the Department of Civil and 
Environmental Engineering at the University of California, Los 
Angeles. Dr. Sant received his bachelor's degree, master's 
degree and Ph.D. from Purdue University.
    Our third witness today is Dr. Venky, and he prefers to be 
called by his first name, Dr. Venky, which makes it easier on 
all of us. Dr. Venky is the Benjamin Peirce Research Professor 
of Technology and Public Policy at Harvard's John A. Paulson 
School of Engineering and Applied Sciences. Dr. Venky 
previously served as Dean of the John Paulson School of 
Engineering and Applied Sciences, and Dean of Physical Sciences 
at Harvard. He received his bachelor's and master's degree in 
physics from St. Stephen's College, Delhi University.
    Our final witness today is Dr. Kiran Kumaraswamy, Market 
Development Director at AES Energy Storage. He previously 
served as the Senior Manager at ICF International in Fairfax, 
Virginia. He received his bachelor's degree in electrical 
engineering from the University of Madras.
    Mr. Kumaraswamy. Madras.
    Chairman Smith. Madras, and his master's degree in 
engineering from the University of Wisconsin, Madison.
    And we welcome you all to the Committee hearing today and 
look forward to your testimony, and Dr. DeWitte, we'll begin 
with you.

                TESTIMONY OF DR. JACOB DEWITTE,

                    PRESIDENT AND CEO, OKLO

    Dr. DeWitte. Thank you, and Chairman Smith and Ranking 
Member Johnson, and distinguished Members of this Committee, I 
want to thank you for holding this hearing and for giving me 
the opportunity to testify today. I am honored to be here, and 
I'm eager to share my experience commercializing advanced 
reactor technologies that build upon a rich legacy of research 
and development with the national laboratory system and the 
Department of Energy.
    As Chairman Smith mentioned in his intro, I was fortunate 
to grow up around Sandia National Laboratory, which played a 
huge role in influencing my decision to go into the fields of 
technology, science, engineering and math as well as pursue 
ultimately an entrepreneurial career, and I'm also excited to 
be working with them now further to commercialize this 
technology.
    So I am the Co-Founder and CEO of Oklo, a Silicon Valley-
based company developing and building a very small advanced 
reactor that produces 1 to 2 megawatts of electric power. We 
sometimes refer to this as a micro-reactor that is designed to 
bring distributed, clean, affordable, and reliable nuclear 
power in small packages to a wide variety of markets, both 
domestically and internationally.
    We started Oklo because we believe advanced reactors will 
play a significant role in the energy mix of the future, and we 
want to make that future a reality as quickly as possible.
    Over half of the active advanced reactor commercialization 
efforts ongoing in the United States today are pursuing fast 
reactor technologies. One of the key technologies to the 
success of fast reactor R&D in the United States has been the 
development of metal fuels. Metal fuels are alloys of uranium 
or other actinides that combine incredible durability, 
flexibility and resilience to achieve phenomenal fuel 
utilization, manufacturability, and safety performance. Metal 
fuel was used in several key early experimental reactors 
operated in the 1950s and 1960s and showed great promise but it 
was sidelined until several key engineering discoveries were 
made through R&D campaigns sponsored by the Atomic Energy 
Commission and then the DOE, which ultimately enabled the fuels 
to realize their potential. These advances were highlighted by 
successful demonstrations at the EBR-II reactor, which operated 
in Idaho.
    Over half of the fast reactor developers in the United 
States are building upon this rich R&D legacy in metal fuel, 
and it is a striking example of a successful government 
investment in R&D that matured a promising technology to the 
point of readiness and commercialization.
    There are also opportunities to expand upon the successes 
in metal fuel. Lessons learned in the development of metal 
fuels have identified avenues to expand its capabilities, which 
illustrates the continuum of innovation that can occur when one 
discovery leads to many more than can further advance the state 
of the art.
    At Oklo, we are working to commercialize a reactor that 
builds on the successful legacy of metal fuel. We pursue a 
business model of following market needs and demands, in other 
words, we strive to make reactors people want. It can be 
tempting to push an exciting new technology to market, but then 
miss what the market needs for the sake of the technology, so 
talking to users to understand what the market requires and 
wants takes discipline. In our experience, we found the 
capabilities offered by metal fuel match customer needs and 
have continued to find market fit and traction thanks in part 
to R&D success of metal fuel.
    We've partnered with several national labs to date 
including Argonne, Idaho and Sandia National Laboratories to 
support our commercialization work. A significant amount of 
this work has focused on commercializing our specific 
application and design of metal fuel. For example, we are 
working with Argonne and Idaho supported by the Gateway for 
Accelerated Innovation and Nuclear, also known as GAIN, to 
assemble fuel performance data that we used in formal pre-
application meetings with the NRC to support our licensing 
case, as well as to fabricate three prototypic fuel elements 
demonstrating key characteristics, which we were excited to 
announce all three hit production specs.
    We are currently expanding our work with the national labs 
because many of the capabilities we need are uniquely found in 
the national lab complex, providing us with an international 
advantage. This is why it is so important to maintain and 
preserve our capabilities and expertise in the national lab 
system and also why we need to develop new capabilities like a 
fast test reactor.
    In fact, I would like to highlight the efforts to build a 
fast reactor that this Committee and Congressman Weaver has so 
earnestly led and supported in a bipartisan way. This is 
incredibly important to develop this capability in the United 
States because the construction and operation of a domestic 
fast test reactor will pay substantial dividends to American 
energy competitiveness as well as leadership. This facility 
will be a national asset and will not only accelerate ongoing 
advanced reactor commercialization efforts but will also be a 
catalyst for new innovations and new technologies.
    Furthermore, to support ongoing innovation, DOE needs to 
provide a fuel source for demonstration, prototype, and first-
of-a-kind advanced reactors by providing low enriched uranium 
fuels that are enriched above the five percent enrichment that 
current LWR fuels use.
    In general, the regulatory challenges that we face in 
advanced reactor space have been overstated, and I'd like to 
take a few minutes, or few moments, I should say, to comment on 
that. While there are challenges, I must emphasize that the 
widely-held view that advanced reactors cannot be licensed 
today is mistaken. We are formally engaged in pre-application 
activities with the NRC and have found clear licensing pathways 
for our technology but work remains.
    Innovation in nuclear is proceeding at a pace reminiscent 
of the early days of nuclear power, and the United States is 
still the global leader, but we need to be mindful of 
international competition. China and Russia are investing 
heavily to develop advanced nuclear technologies, and we cannot 
afford to fall behind. Our national capacity to innovate, 
combined with our national capabilities to research and 
develop, give us tremendous advantages.
    Thank you.
    [The prepared statement of Dr. DeWitte follows:]
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    Chairman Smith. Thank you, Dr. DeWitte.
    And Dr. Sant.

                TESTIMONY OF DR. GAURAV N. SANT,

         ASSOCIATE PROFESSOR AND HENRY SAMUELI FELLOW,

       DEPARTMENT OF CIVIL AND ENVIRONMENTAL ENGINEERING,

              HENRY SAMUELI SCHOOL OF ENGINEERING

                      AND APPLIED SCIENCE,

          UNIVERSITY OF CALIFORNIA, LOS ANGELES (UCLA)

    Mr. Sant. Thank you, Chairman Smith, Ranking Member 
Johnson, and Members of the Committee for inviting me to appear 
before you as you review private sector leadership in next-
generation energy technology to increase efficiency, 
environmental benefits and consumer savings, and review 
associated research and regulatory hurdles.
    As requested by the Committee, I am focusing my testimony 
on research that we've been engaged in that seeks to convert 
carbon dioxide (CO2) into a novel building material, 
CO2NCRETE, with CO2 at the front. The 
views expressed herein are my own, and do not necessarily 
represent those of UCLA. In brief, I'm an Associate Professor 
and Henry Samueli Fellow in the Henry Samueli School of 
Engineering and Applied Science at the University of 
California, Los Angeles. I'm a civil engineer, and a materials 
scientist with broad ranging expertise in materials synthesis, 
characterization and simulation.
    My testimony today can be summarized as follows starting 
with the motivation. Electricity generation from coal-fired 
power plants alone represents about 25 percent of CO2 
emissions from the United States. It's about 1.2 billion tons 
of CO2 emitted in 2016. Carbon capture and storage 
(CCS) has been proposed as a solution to mitigate CO2 
emissions caused by industrial activities. However, CCS is not 
always viable due to issues with high cost, uncertainty in the 
permanence of the sequestration solution, and/or the lack of 
suitable geological features in the local vicinity where CCS 
can be achieved. Therefore, it is necessary to identify and 
create new pathways for the beneficial utilization of CO2 
while simultaneously yielding a permanent CCS solution.
    A novel approach to mitigate CO2 emissions is by 
upcycling or beneficially utilizing industrial wastes that may 
be in the form of solids, liquids, or vapors to create new 
materials, for example, CO2NCRETE. As an example, in 
the case of flue gas-borne CO2, this is accomplished 
by converting gas borne CO2 by mineralization into 
stable carbonate compounds which may offer cementitious 
character into building materials. Not only do such innovative 
technologies yield environmental benefits, but they also have 
the potential to reduce the environmental impact of the 
construction sector as follows. The production of ordinary 
Portland cement--the primary binding agent used in traditional 
concrete--results in nearly nine percent of global CO2 
emissions. For example, nearly .9 tons of carbon dioxide are 
emitted per ton of OPC produced. Therefore, the development of 
new cementation agents that take up CO2 will help 
reduce the CO2 emissions associated with OPC and 
concrete) production.
    With respect to material recycling, the simultaneous reuse 
of CO2 and industrial byproducts--solid wastes--
resulting from coal combustion creates a new paradigm in waste-
to-resource recycling of materials. This creates a circular 
economy paradigm between the energy and construction sectors 
and thus greatly enhances the sustainability metrics of both 
industries. The upcycling process that we've proposed and 
demonstrated is accomplished by contacting calcium hydroxide 
with flue gas-borne CO2. Such calcium hydroxide or 
portlandite can be secured by calcining limestone and hydrating 
the lime that results or by leaching calcium species from 
alkaline industrial wastes such as slags and coal combustion 
residuals. Following combination with fine and coarse mineral 
aggregates, chemical additives, water, and suitable binding 
agents if needed--similar to traditional concrete--this mixture 
containing calcium hydroxide forms a slurry that can be shaped 
into common construction elements, such as beams, columns, and 
slabs. Importantly, the upcycled concrete production process is 
designed to bolt-on to large point-source CO2 
emitters including petrochemical facilities, coal- and natural 
gas-fired power plants, and cement plants. In each case, 
emitted flue gas is used to both provide both waste heat to 
hasten chemical reactions, and to provide CO2 to 
ensure mineralization without imposing any additional need for 
emissions control. The process cycle is being designed for 
scalable operations to accelerate the R&D pathway towards 
pilot-scale trials, technology commercialization and 
deployment.
    CO2NCRETE offers a transformative route for the 
beneficial utilization of flue gas-borne CO2 in the 
cementation cycle. This creates pathways to produce 
construction materials with up to 50 percent or lower carbon 
dioxide intensity than ordinary Portland cement.
    Furthermore, by creating a robust CO2 and solid 
waste offtake partnership between the energy and the 
construction sectors, the outcomes of this work create new 
sectoral synergies which would be difficult to realize 
otherwise. Significantly, this CO2 upcycling 
approach can reduce the environmental impact of electricity 
generation from fossil fuels, while simultaneously advancing 
the materials, methods and processes utilized by the 
construction sector.
    Financial support secured from federal agencies including 
the Department of Energy, the Department of Transportation, and 
the National Science Foundation has been instrumental in 
enabling our work. The support of federal agencies such as 
those noted above, and others, is critical for enabling basic 
and applied R&D, technology creation and development. Broadly, 
with significant competitive international investments in R&D 
around the world, federal support of basic and applied R&D, in 
core and emerging domains such as CO2 utilization 
and reuse is more important now than ever. This is because 
federal R&D support is vital to enable the creation of 
knowledge and technology within universities and national 
laboratories, the reservoirs of knowledge that have ensured 
U.S. intellectual leadership globally.
    Furthermore, federal support of R&D is especially important 
in the case of technologies which benefit conventional 
industries which are unlikely to being offshored, for example, 
electricity generation and the construction sector, which 
feature reduced appetite for technical and commercial risk due 
to uncertainty in revenue, profit pressures, regulatory and 
compliance burdens, or high costs associated with the 
development of greenfield facilities with long operating 
horizons. Therefore, it becomes necessary for the government to 
underwrite a larger proportion of the costs associated with R&D 
that has the potential to benefit such industries, and in turn, 
the general public, until sufficient technology maturity is 
achieved.
    However, once such maturity is achieved, and industry is 
assured of the commercial value and potential of new 
technology, it is expected that industry will take over and 
accelerate the residual R&D pathway including commercial trials 
that results in market penetration, and diffusion of new 
technology.
    Thank you again for the opportunity to testify on this 
important topic.
    [The prepared statement of Mr. Sant follows:]
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    Chairman Smith. Thank you, Dr. Sant.
    And Dr. Venky.

              TESTIMONY OFDR. VENKY NARAYANAMURTI,

               BENJAMIN PEIRCE RESEARCH PROFESSOR

                OF TECHNOLOGY AND PUBLIC POLICY,

             JOHN A. PAULSON SCHOOL OF ENGINEERING

            AND APPLIED SCIENCES, HARVARD UNIVERSITY

    Mr. Narayanamurti. Thank you, Chairman Smith, Honorable 
Minority Leader Johnson, and Members of the House Space, 
Science and Technology Committee. Thank you for this 
opportunity to speak about the role of----
    Chairman Smith. Is your mic on? There we go.
    Mr. Kumaraswamy. Can you hear me now?
    Chairman Smith. Yes. Thank you.
    Mr. Narayanamurti. Thank you for the opportunity to speak 
about the role of public policy in energy innovation.
    My perspective comes from a lifetime of working in science 
and technology, first at AT&T Bell Laboratories, then in 
national labs, Sandia National Lab, and in academia as well as 
my recent research at the Harvard Kennedy School and my role on 
several committees of the National Academies and the American 
Academy of Arts and Sciences.
    I have three main points to make to you today. First, we 
must break down the false dichotomy between so-called basic and 
applied research. In my lexicon, there's only word, research, 
and research must be scientific research, physics research, 
technology research, engineering research.
    Second, in energy alone, history has shown that sometimes 
engineering inventions precede detailed scientific 
understanding and sometimes new scientific discoveries lead to 
new engineering inventions. This creation of the steam engine 
200 years ago by James Watt led to the industrial revolution 
long before the science of thermodynamics, the invention of the 
light bulb, Edison and transformers led to the field of 
electrical power engineering. On the other side, the scientific 
work of Einstein, which showed the connection between mass and 
energy, and the work of Enrico Fermi on nuclear fission led 
eventually to nuclear power.
    My second point is that government has an important role in 
fostering energy innovation done in the proper way, which 
couples the desire to understand and the desire to create new 
things. That's what America is about, in my view. If you do not 
combine so-called basic and applied research, it's a missed 
opportunity. We learn by doing. Everything I do in class, we 
learn by doing. The private sector in energy in particular does 
not invest appropriately long-term R&D. In fact, that's through 
widely of the American economy because of the global 
competition and because the fruits of this research cannot be 
easily captured because of the risks and the breadth of those 
values. This leads to valleys of death which government funding 
is needed to overcome. The early stage I, which is where I'm 
expert of transformative, it really is important because in 
fact that--the risks are huge but the gains also can be very 
large, high risk, high reward, as Honorable Johnson mentioned.
    Technology transfer, secondly, is a body contact support. 
It requires interactions, collaboration between actors from 
places like the national labs, universities, and the private 
sector.
    I now want to turn to a few points on the role of the U.S. 
Department of Energy, which has its mission general science as 
well as energy and national security. In the energy space, 
Department of Energy investments in the past have led to major 
technological advances such as the shale gas revolution, which 
we are using the fruits of today. It was done in the 1980s when 
people at the DOE and the Gas Research Institute helped an 
entrepreneur by the name of Mitchell, Mitchell Energy. The big 
companies didn't want to do it, and it was not of course cost-
effective then but today it has become a huge effect here, and 
similarly, nuclear power, which has also been mentioned, and 
solar photovoltaics. This has often been done by the so-called 
applied offices in the DOE. The full potential of the 
Department of Energy's work in this space can only be realized 
by further breaking down the boundaries between basic and 
applied research. Recent attempts to break down this boundary 
and the creation of interdisciplinary research efforts through 
energy Frontier Research Centers, Energy Innovation Hubs, and 
ARPA-E were, in my view, the steps in the right direction 
including the creation of a unified Under Secretary for Science 
and Energy. We do want to break down these barriers, and if I 
may be, as a respectful reminder, point to this Committee which 
also has responsibility for the National Science Foundation. 
Eric Block, who came from IBM and understood the industrial lab 
culture in the 1980s, changed many of the NSF features in a 
very positive direction. He created physics frontier centers, 
he created science and technology centers, and he created 
engineering research centers, which have a 40-year history of 
great success and have been evaluated in books. The recent 
constructs at DOE in fact emulate them. Energy Innovation Hubs 
are like science and technology centers and like engineering 
research centers, and they deserve to be funded just as the 
physics frontier center. So this not against the basic 
research; it is how you keep the boundary.
    So I would like to say the great diversity and complexity 
in energy science and technology calls for a portfolio approach 
both in terms of content and management. I did not mention 
ARPA-E. ARPA-E is a slightly different construct, which where 
actually the program managers modeled like DARPA to actually go 
for the high-risk reward, and we have done studies on it which 
I can speak about later in questioning, which actually shows 
enormous effort which ARPA-E has also done.
    So in closing, I believe we are in a critical juncture and 
our choices today will have far-reaching consequences. I cannot 
overemphasize the importance of government support of energy 
innovation across the basic-applied divide and enhancing 
cooperation and collaboration between academic, national 
laboratories, and industry.
    Thank you.
    [The prepared statement of Mr. Narayanamurti follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
    
    Chairman Smith. Thank you, Dr. Venky. You certainly know 
how to message research.
    We'll now go to Mr. Kumaraswamy. We look forward to your 
comments.

              TESTIMONY OF MR. KIRAN KUMARASWAMY,

                  MARKET DEVELOPMENT DIRECTOR,

                       AES ENERGY STORAGE

    Mr. Kumaraswamy. Thank you, Chairman Smith and 
distinguished Members of the Committee. I'm honored to testify 
in front of you today on the topic of energy innovation and 
private sector leadership and commercializing new technologies.
    Innovation can and will transform the energy sector and in 
turn, people's lives. Bringing change to the industry is part 
of our DNA at AES and, in many ways, is what we do best. AES 
was started 35 years ago by two former government employees, 
Roger Sant and Dennis Bakke, who saw an opportunity in the 
emerging independent generation market and we continue to grow 
by innovating new solutions to serve emerging power sector 
needs.
    I think innovation is very different from invention. 
Invention is a new idea. Innovation is actually doing something 
with the idea or applying an existing idea in a new way to 
drive a greater impact. That means that to AES, innovation can 
happen not just through technology, but by thinking about 
business models differently or modifying market structures. 
It's an approach we call applied innovation.
    There is no better example of our applied innovation 
approach than in our energy storage business. We've come far 
from where we started ten years ago in the energy storage 
business. Back then, battery based energy storage on the grid 
was experimental, and did not exist as a business opportunity. 
Today, it is a proven solution and is operating successfully 
across the country and in several global markets. We stand at 
the beginning of the next big scaling up, taking this vital 
technology to more customers, more countries, and more grids 
around the world.
    In the context of today's discussion and applied 
innovation, it's pretty important to understand how we got 
here. In 2007, AES Energy Storage was founded as a subsidiary 
of AES to carry forward our initial survey of advances in 
battery technology and power electronics. At the time, no one 
had designed a large-scale energy storage system using lithium-
ion batteries. The conventional wisdom of the time was that 
batteries could not meet the challenges of utility-scale 
performance. As lithium-ion technology emerged, our team 
believed we had found useful business cases for battery-based 
energy storage systems
    We moved forward with designing and building the first 
megawatt-scale lithium-ion battery energy storage project. 
Several years later, with 20 projects now and 398 megawatts 
deployed and awarded across seven different countries globally, 
we've helped ensure more customers in more locations can 
benefit from energy storage.
    In 2014, in California, we demonstrated that batteries 
could compete successfully against peaking power plants, 
securing the world's first power purchase agreements for energy 
storage to serve a utility customer for 20 years, and still the 
largest contracted energy storage project in the world.
    Just last week, Siemens and AES announced we will join 
forces to create Fluence, a new global energy storage 
technology and services company that unites the scale, 
experience, and reach of its two parent companies.
    With the market at an inflection point, what did we, as a 
private company, learn about commercializing next-generation 
technologies in the power market? I'd like to make four points 
to the Committee.
    First, the existing power market is not designed to reward 
innovators, and many of the needs reside within the network 
without any capability for compensation. Many of the rules in 
the current power markets were put in place for traditional 
generation and do no fully account for technical and 
performance characteristics of advanced technologies like 
energy storage. It is important to remedy these regulatory 
concerns as soon as possible. The federal government has an 
important role to play here to ensure markets are fully 
competitive and have the policy in place to catch up with the 
technology. Otherwise, market rules set up several years ago 
become an unintended roadblock for commercializing energy 
storage.
    The Federal Energy Regulatory Commission currently has a 
Notice of Proposed Rulemaking related to removing barriers for 
storage participation in wholesale power markets. These types 
of efforts that include reforming market regulations to enable 
storage to compete in markets should be accelerated.
    Second, on the topic of battery chemistry research, we 
believe that lithium ion is mature right now and private 
capital from large battery manufacturing companies is moving it 
forward at incredible speed and investment. The government 
should continue funding R&D on other early-stage battery 
chemistries that have the potential to achieve greater 
capabilities in the near future.
    Third, the national labs through the Department of Energy 
are doing a great job in advancing the modeling and 
visualization of benefits that energy storage brings to the 
grid. These are complex analytic simulations that require the 
use of state-of-the-art power market models and a high degree 
of computational rigor. The government should encourage and 
increase investments in the DOE and national labs to continue 
this important work.
    Finally, the last point that I would like to make is that 
the federal government should continue to provide technical 
assistance to storage project deployments, particularly for 
states and utilities that are considering their first projects 
but may be constrained by lack of technical experience. Through 
our experience in the energy storage business, we have found 
that deploying projects in the field is the best way to enhance 
learning among all stakeholders.
    Mr. Chairman, thank you again for the opportunity to 
testify today. I would like to invite you and the other Members 
of the Committee to visit any of our storage facilities in the 
United States. I am happy to take questions. Thank you.
    [The prepared statement of Mr. Kumaraswamy follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
    
    Chairman Smith. Thank you, Mr. Kumaraswamy.
    Let me address my first question to Dr. DeWitte and Mr. 
Kumaraswamy, and it is this: What regulatory hurdles did you 
face and what do you suggest Congress do to address those 
regulatory hurdles? And Dr. DeWitte, we'll start with you.
    Dr. DeWitte. Thank you for the question. We're actively in 
that process right now, and we have a long road ahead of us, 
frankly. The nuclear regulatory process is--it's an ongoing and 
sort of everlasting process once you are commercializing a 
technology and putting it to field and into market. There's 
been a lot of concerns historically about the readiness for the 
Nuclear Regulatory Commission to handle advanced reactors. We 
found that that's generally been overstated and that they've 
been well prepared. In particular, recent activities around 
working with DOE to prepare for what are called advanced 
reactor design criteria as well as other efforts the NRC has 
undertaken to prepare themselves technically to review advanced 
reactor applications are paying dividends as we speak.
    Our formal interactions with the regulator have gone quite 
well so far. However, there's still room to improve, and I 
think a couple of those areas focus on rightsizing regulations 
for reactor size and potential risk and also rightsizing 
security and staffing requirements. That still needs to be 
done. So there's still opportunities for improvement but 
generally we've been pleased.
    Chairman Smith. Okay. Good. Thank you, Dr. DeWitte.
    Mr. Kumaraswamy?
    Mr. Kumaraswamy. Thank you, Chairman. Like I mentioned in 
my opening remarks, I think one of the key things in the power 
sector is that you have market rules that are put in place for 
technologies that were prevalent at that time in the 
marketplace, and these are commonly tailored towards 
traditional generation facilities, and one of the concerns that 
we have is that when you have advanced technologies like energy 
storage that are trying to get into these regional power 
markets, those rules don't apply directly to them so they have 
to be changed in order for you to allow for the capabilities 
and performance characteristics of these devices.
    So just to give you an example, Indianapolis Power and 
Light, which is an AES Company, which is in the State of 
Indiana, we have had difficulty integrating a new 20-megawatt 
battery energy storage project in that regional market mainly 
because of the fact that the power market rules in the Midwest, 
independent system operator are not set up to handle the 
characteristics of energy storage, and so Federal Energy 
Regulatory Commission is doing a great job. They have that 
Notice of Proposed Rulemaking to remedy a lot of these issues, 
and I think encouraging those efforts to completion as quickly 
as possible once FERC actually gets the quorum would be a 
pretty important step for us to make sure that the technology 
can be brought into the market and the market can realize all 
of those benefits that the technology provides.
    Chairman Smith. Okay. Good. Thanks.
    Dr. Sant and Dr. DeWitte and Mr. Kumaraswamy, do your 
technologies reduce carbon emissions? And if so, can you 
quantify it? But first of all, do they reduce carbon emissions, 
and is that significant? Dr. DeWitte--Dr. Sant, let's start 
with you.
    Mr. Sant. Thank you, Chairman Smith. Yes, they do. I should 
point out the way our work is really set up, what we're trying 
to do is reduce the carbon dioxide emissions that are 
associated with cement production. So we're trying to create 
replacements for Portland cement, which like I pointed out, 
provides about, give or take, nine percent of global CO2 
emissions. Being able to reduce the CO2 footprint 
associated with cement production by avoidance and by taking up 
CO2 by utilization, both yield reductions in carbon 
dioxide. However, we should be careful to point out that this 
is a small number, so we're talking about a few percentage 
points. It's a big number if you look at it in terms of the 
potential reduction that you can achieve, but in the grand 
scheme of things, it's still only a few percent.
    Chairman Smith. Okay. Thank you, Dr. Sant.
    And Mr. Kumaraswamy?
    Mr. Narayanamurti. Sure. Energy storage definitely has the 
capability to reduce the amount of emissions that we have. It's 
also notable that the U.S. electric grid currently has less 
than one percent of energy storage in the system. That's equal 
to about 20 minutes of the total demand that we have for energy 
in the country. This is in comparison to about 4 days' worth of 
storage that we typically find in other networks like gas 
networks and significantly more storage than we have in things 
like data networks. So just a point that the amount of energy 
storage that we have in the system is significantly lower in 
the energy system.
    By increasing the amount of energy storage that we have in 
the grid, we can make sure that we integrate all of the 
renewable energy sources that we have on the system, and most 
importantly, help operate the existing conventional generation 
resources much more efficiently. Instead of cycling them back 
and forth, you actually get the capability to operate these 
existing generation facilities at more stable output blocks, 
which means that they actually produce less emissions, and you 
reduce the amount of renewable curtailment also and so there's 
significant environmental benefits with energy storage.
    Chairman Smith. Thanks, and Dr. DeWitte, briefly, nuclear 
is obviously going to have a huge impact on carbon emissions. 
Can you explain why and how?
    Dr. DeWitte. Yes. It has a huge impact on reducing CO2 
and other emissions because it doesn't produce any during 
generation and it has a massive scalable potential. One single 
fission event produces 50 million times as much energy as when 
you combust a single molecule of natural gas, so you can avoid 
a lot of emissions. Look at France and Sweden. They have some 
of the best track records for decarbonization solely due to 
nuclear, frankly.
    Chairman Smith. Okay. Thank you. I appreciate your answers 
today.
    And Ms. Johnson is recognized for her questions.
    Ms. Johnson. Thank you very much, Mr. Chairman.
    Dr. Venky, we have heard from scientists and policymakers 
alike that there's often a false boundary drawn between basic 
and applied science. To some, supporting basic research is an 
important role that government--of government while applied 
research should be left to the private sector. Yet this idea 
that there is a line that neatly divides the two separate 
levels of research is not realistic and certainly goes against 
general understanding of scientific discovery and innovation.
    As you mentioned in your testimony, you have written 
extensively about this issue. Would you agree with this 
characterization or do you really feel there is a distinctive 
line?
    Mr. Narayanamurti. So thank you very much, Honorable 
Minority Leader. I want to really emphasize that historically, 
this divide started during World War II, but really, many 
scholars, not just me, including economists, social scientists 
have done studies and have shown that this is a false dichotomy 
and in fact you have to actually fund all aspects of research 
to be effective.
    My own work, which really was modeled after Bell Labs--in 
fact, I looked at the original speeches of Bell Labs. They were 
such iconic institutions which did such great science and such 
great technology. They made an explicit point of not breaking 
research up into parts. In fact, the leader of Bell Labs had 
arguments with Vannevar Bush on that subject because he said we 
do not separate them because in fact discoveries and inventions 
feed on each other and there's both back and forth.
    So my argument is, research does need some insulation but 
not from engineering and technology. It is about the long term. 
It is about the somewhat unpredictable, unscheduled. Nobody 
predicted the shale gas revolution would happen by that 
research, as an example. Same with nuclear fission, same with 
solar cells. So the point is, the longer-term work, the federal 
government has an extreme role and it must involve science, 
technology and engineering intimately linked and not separated, 
and that's--the Department of Energy, the way this has been 
separated, has been a severe hindrance in my view in terms of 
stovepiping. As I mentioned, even NSF realized in the 1980s 
through a corporate lab director named Eric Block to create 
these interdisciplinary centers including engineering research 
centers so the question to ask is, how are the Energy 
Innovation Hubs like the Science and Technology Centers and 
Engineering Research Centers, which is missing in the Office of 
Science.
    Ms. Johnson. Thank you. Any other witnesses like to comment 
on that?
    Dr. DeWitte. I would, please. Thank you.
    I think it's one of the interesting things about the 
commercialization that we're working on towards--with metal 
fuels specifically and advanced reactors is it opens up the 
pathway to continuous innovation for improvements that we've 
discovered along the development pathway already. It's 
important to never lose sight of that and not to think that 
something is just ready because it's still at some of those 
stages that you discover new things to do. Those are still too 
early for commercial readiness, and it's important to have an 
awareness on that, and also to maintain that perspective that 
once you get something ready to go for commercialization, that 
doesn't mean innovation is done. There's still opportunities 
and pathways to bridge on that.
    Mr. Narayanamurti. May I add?
    Ms. Johnson. Sure.
    Mr. Narayanamurti. So you can argue how far in the 
innovation chain one should fund, and we can discuss that. This 
is back to the late stage, and that's a legitimate argument. I 
would say it depends on the situation.
    Ms. Johnson. Dr. Venky, the President's budget request 
declared some research as early stage and therefore worthy of 
federal support and other activities as later-stage research 
that should be immediately eliminated given that the private 
sector is supposedly better equipped to carry this research 
out. However, the Administration officials recently confirmed 
to Committee staff that they did not engage with the private 
sector at all while compiling the budget request to determine 
what industry would be able to or willing to pick this up. In 
your experience, are the cuts proposed for the fiscal year 2018 
budget research areas that the private sector is willing to 
simply start funding after the federal government cuts them 
off?
    Mr. Narayanamurti. This is an extremely important question. 
I actually--I personally feel, I think there is not good data 
on that anyway, but the private sector today in the United 
States is just not doing the longer-term work because of the 
risk involved, and that's one of the reasons in fact because of 
global competition, other countries are beginning to do more of 
that because of state support. So the point is, our companies 
are not doing it, not in every industry. IT is still--I think 
Google and Microsoft are doing some, which his very good, but 
the energy case, it's definitely not true.
    There is evidence, on the other hand, if government makes 
the investments, eventually it reaches the private sector as it 
did for the shale gas and several other cases, but what is 
really quite important, I think, is there does need to be like 
our Engineering Centers, our Energy Innovation Hubs, ARPA-E, 
must involve consultations with the private sector. We do want 
to have them involved in that discussion so that we can 
actually think about that. When we made our energy plans in the 
book which I co-authored with two of my colleagues, we actually 
interviewed a lot of private sector people where they thought 
the investment should be made. So I think because they want the 
long-term investments, so I think we want to involve them in 
the discussion as well. It has to be a cooperative thing. As I 
said, technology transfer is a body contact support.
    Ms. Johnson. Thank you. My time has expired.
    Chairman Smith. Thank you, Ms. Johnson.
    The gentleman from California, Mr. Rohrabacher, is 
recognized.
    Mr. Rohrabacher. Thank you very much, Mr. Chairman, and 
thank you, Mr. Chairman, for taking the leadership and calling 
this hearing today. We need to have discussions like this on 
basics, and your leadership is certainly making sure that we 
get that type of discussion.
    Let me note that to our witness who was mentioning about 
the--Mr. Sant, who was mentioning about the turning of CO2 
into useful material, and we compare that to what I consider to 
be sort of an irrational approach to try dealing with CO2 
and just trying to eliminate CO2. You're suggesting 
that we actually can use CO2 in a way that will be 
beneficial to humankind and making a profit out of extracting 
it. And let me note that you're talking about cement. There is 
a company in my area, Newlight, that has developed a 
methodology of--and they have a process now working that takes 
CO2 out of the air and turns it into plastic, high-
quality plastic, and I think that we are going to find with 
research that instead of going about the regulatory and trying 
to stamp out the use of CO2, we're going to find 
it's much more effective for mankind to find useful purposes 
for CO2 that we can actually extract it from the air 
and we don't have to worry about the debate as to whether 
CO2 is a pollutant or not if you actually have 
people using it for positive ends. So number one, I thank you 
for your testimony today. I didn't know about your uses that 
you're suggesting that are available, and I think it deserves a 
lot of attention. So thank you.
    What also deserves attention as far as I'm concerned is the 
future of nuclear energy in this country, and throughout the 
world. Nuclear energy had such great--we had such great hopes 
for it but it should be evident to anyone now that the former 
light water reactors, the initial move on stage in the nuclear 
area, is extraordinarily dangerous. We have closed down San 
Onofre in my area, and rightfully so, because there are dangers 
involved with light water reactors.
    Mr. DeWitte, does your, what you're trying to develop now 
in the nuclear energy field, does that have the same dangers?
    Dr. DeWitte. No, very different safety profile. It operates 
truly on natural forces. It's very passive. It has a pressure--
basically no pressure operations and so it makes it a very safe 
profile in terms of what it can do and behave.
    Mr. Rohrabacher. Can it melt down and release 
radioactivity?
    Dr. DeWitte. Effectively, no.
    Mr. Rohrabacher. So we have the capability now, Mr. 
Chairman, to actually do this. We've had this capability for a 
while, and we have instead been for whatever forces at play in 
our society, we have been channeling resources into developing 
nuclear power plants that have extreme danger associated with 
them, and now we should understand, and the testimony today 
highlights this, that we should focus on our alternatives, 
making sure the alternative that we have, which is a nuclear 
energy source for electricity, that is far less dangerous, if 
not dangerous at all. We should make sure that that comes to 
play. That's right through this Committee. This Committee will 
do the things that are necessary to make sure that the next 
generation of nuclear power, which is safer, that we get into 
that new generation as soon as possible. And when we're talking 
about that, as soon as possible.
    Dr. DeWitte, do you see the fact that the small-scale 
programs and perhaps like your own which provide--were provided 
technical support and lab capabilities, do you think, is that a 
better way for us to approach this than through large grants 
through the license to try to move things through the 
regulatory process?
    Dr. DeWitte. I think in general it has substantial benefits 
for where the industry is now, and I think it is a better way 
because I think what we've seen is, we've had very high impacts 
and high-leverage outcomes from a very small amount of money to 
date, much more efficiently than you would get with a large 
cost-share program at this stage. That doesn't mean that you 
can have those down the road for demonstration-type purposes 
but I think it's a better use at this stage.
    Mr. Rohrabacher. And one last thing, Mr. Chairman. I think 
that the--it doesn't really make sense for us to be funding big 
companies to help them move through the licensing process, 
which is basically a federal process, so we're giving grants to 
people to help them deal with the federal agencies and instead 
we should try to reform the federal agencies so that they don't 
have these impediments to this type of progress.
    Thank you very much again for your leadership, Mr. 
Chairman.
    Chairman Smith. Thank you, Mr. Rohrabacher, and the 
gentlewoman from Oregon, Ms. Bonamici, is recognized.
    Ms. Bonamici. Thank you very much, Mr. Chairman, and thank 
you to the panel for your excellent testimony.
    Dr. DeWitte, I want to thank you particularly for 
mentioning in your testimony NuScale Power, which is of course 
headquartered in northwest Oregon in the district I'm honored 
to represent, and also thank you for mentioning the role of the 
national labs and the Department of Energy in your work over 
the years. I really appreciate that.
    Mr. Kumaraswamy, thank you for talking about energy 
storage, and your work on energy storage and the potential for 
modernizing the grid is something that I've had many 
conversations about back home in Oregon. In your testimony, you 
say that the national labs through the Department of Energy are 
doing a great job in advancing the modeling and visualization 
of benefits that energy storage brings to the grid, and you go 
on to say that the government should encourage and increase 
investments in the Department of Energy and national labs to 
continue this work. Yet we are now looking at the Trump 
Administration's proposal, which has significant cuts to the 
Department of Energy. They seem to be ignoring recommendations 
from industry experts like you. For example, the fiscal year 
2018 budget proposes to eliminate the Advanced Modeling Grid 
Research subprogram that's within the Department of--excuse 
me--within the Office of Electricity Delivery and Energy 
Reliability. I know that Administration officials recently 
confirmed that they did not engage with the private sector at 
all when determining which Department of Energy R&D programs 
they would be cutting or eliminating.
    So could you comment on what the consequences would be of 
cutting research and development programs like that one that 
provide us with the capabilities that you mentioned are so 
important in upgrading the grid?
    Mr. Kumaraswamy. Sure. I think one of the hallmarks of 
commercializing new technologies like energy storage and 
bringing them to market is making sure that the needs of the 
system and the benefits of the technology can be understood and 
appreciated by all of the stakeholders, and so just maybe I can 
offer an example of one of the early instances when we actually 
deployed energy storage in the marketplace. This happened to be 
in the mid-Atlantic region of the country in a market called 
the PJM regional transmission market, and this was largely made 
possible because of the fact that the market made the need 
completely known to everybody that was involved in that place, 
and so you know, it was need that was oriented around frequency 
management and the role that energy storage could play towards 
addressing the frequency management issue and provide all of 
the service and for all of the stakeholders to evaluate those 
benefits. The tools were available for that. And so I think 
that's the key part towards commercializing new technologies, 
and other parts of our electric sector where we don't have 
organized electric markets like in the PJM market or portions 
of the Northeast, I think the need still remains pretty 
obscure.
    Ms. Bonamici. Thank you, and I do want to get to another 
question. Thank you very much.
    Dr. Venky, the Trump Administration released its budget 
proposal for fiscal year 2018, and the research and development 
funding levels, as I mentioned for the Department of Energy, 
are woefully inadequate, and the President said he wants to 
usher in an era of American energy dominance yet he's 
simultaneously proposing to cut and, frankly, devastate our 
energy research enterprise, so that's not the path to a 
stronger America. It's a path to energy reliance on 
international, sometimes unstable competitors.
    So does the fiscal year budget proposal set us on a path 
toward energy dominance, and will the private sector be willing 
and able to fund the research that will no longer be funded if 
these budget cuts go into effect?
    Mr. Narayanamurti. Thank you very much for that question 
because I think you're right on. In fact, many of the things 
mentioned including nuclear power at Idaho Nuclear Laboratory 
or National Nuclear Energy Laboratory, which does a lot of test 
facilities for many of our things, they come from the so-called 
applied offices, and these are extremely important test 
facilities which are vital for the national interest.
    Second, in fact, this early-stage technology research is 
not being done by the private industry. As I said, we do want 
to involve them. There needs to be cooperative research and 
development agreements but, in fact, we will become second 
class from what I see in my role both as Foreign Secretary of 
the National Academies and continuing looking at what is 
happening in China and other places. That technology is moving 
forward, and we need to be at the leading edge.
    Ms. Bonamici. I agree that----
    Mr. Narayanamurti. I cannot----
    Ms. Bonamici. Dr. Venky, the energy efficiency and 
renewable energy would receive a 70 percent cut, and some of 
the activities will get an 80 percent cut. Oregonians are 
leading the way with some of these technologies. What would be 
the consequences of drastically reducing that research and 
development for U.S. competitiveness in a global economy?
    Mr. Narayanamurti. We will not be protecting our future. As 
an American, I came here during the height of the space race 
and the role of technology, how important it was. I'm 
passionate about technology. It is politically agnostic. It 
really will shape our future. Even electric cars, that horse 
has run out of the barn. It's only two percent today but longer 
term people learn to make it cheaper, it'll be much more 
efficient because the engine is much easier to maintain from 
simple engineering, the same reason shale revolution happened 
because natural gas is cleaner and cheaper than coal. So it 
behooves us--people talked about nuclear. Nuclear is extremely 
important, and I think for this Committee, it's important to 
know that no matter what happens, the electricity grid is going 
to need base power, at least 20 percent base power, so we will 
have to have it come either some kind of natural gas or nuclear 
or some other--maybe even coal, clean coal where you capture 
it. So we want to protect that. It has to be diversified and 
heterogeneous and we should be advancing the nuclear technology 
so it becomes safer, more cost-effective, et cetera, and doing 
that kind of research, I personally think it's still valuable.
    Ms. Bonamici. Thank you, Dr. Venky.
    I see my time is expired. Thank you, Mr. Chairman.
    Chairman Smith. Thank you, Mr. Bonamici.
    And the gentleman from Texas, Mr. Weber, is recognized.
    Mr. Weber. Thank you, Mr. Chairman.
    My goodness. So many questions here.
    Dr. Venky, I'm going to come right back to you. You said 20 
percent base power backup, whether it's clean coal, whether 
it's nuclear, whether it's natural gas. How did you get to 20 
percent?
    Mr. Narayanamurti. I think people have done great work and 
figured out statistically what will happen so you know that you 
need some base power. People have--people who know how to 
manage grids will tell you that you've got to maintain 
stability have a certain backup of steady power.
    Mr. Weber. That seems low to me because that's one-fifth of 
the power required.
    Mr. Narayanamurti. Somebody may say it might be a little 
higher. Certainly it's going to be required.
    Mr. Weber. Would you agree that it's better to have more 
power than less power?
    Mr. Narayanamurti. It's always good to have. I believe in 
safety.
    Mr. Weber. Okay. And you believe in clean coal technology?
    Mr. Narayanamurti. If clean coal can be done. So one of the 
options--technology must provide options, and so when you have 
one of the areas that long-term federal funding might be 
valuable is in fact for carbon capture and storage if you can 
actually make use of the carbon, which is even better. So I 
actually want to keep those options open including for large 
investments for certain cases because options is what the 
technology is about.
    Mr. Weber. Okay. Well, certainly they are, and I would say 
the higher percentage is the best option there.
    Mr. Narayanamurti. And then there are many global countries 
which are dependent on those. They might have to have some 
global implications, which might help the overall----
    Mr. Weber. Was it Theodore Roosevelt who said ``Speak 
softly and use nuclear as backup''? I'm just----
    Mr. Narayanamurti. Sorry. I get excited.
    Mr. Weber. Just asking.
    Mr. Narayanamurti. Yes.
    Mr. Weber. Dr. DeWitte, this question is for you. You were 
a strong supporter of our nuclear energy legislation, which 
passed the House three times last Congress--you alluded to 
that--and again earlier this year as part of the DOE Research 
Innovation Act. What could the policy--obviously you're 
tracking that bill and paying attention. What could the policy 
in that bill including the construction of that versatile 
neutron source provide to you and other advanced reactor 
companies? Would you elaborate on that for us?
    Dr. DeWitte. Absolutely. Thank you for the question. That 
legislation's incredibly important because it enables--one, it 
opens up the opportunities and streamlines the processes to 
work with the national labs and take advantage of their 
infrastructure and capabilities, and it also, of course, paves 
the way to provide new capabilities with a versatile neutron 
source or a fast test reactor, which will accelerate both the 
development of new fuels and materials so that we can get to 
market more quickly with these technologies and discover 
entirely new things that we don't even know about today because 
we don't have those capabilities that a facility like that 
would provide.
    Mr. Weber. All while working with the regulatory agency 
that would be involved in the process----
    Dr. DeWitte. Absolutely.
    Mr. Weber. --which would help expedite that process.
    Dr. DeWitte. And that's critical too because they need to 
learn from it, and we can all learn together, frankly.
    Mr. Weber. You bet ya. Now, you also mentioned that France 
and Sweden have done a really good job of reducing their 
carbon. Do you know percentages and time frames?
    Dr. DeWitte. Generally speaking, France decarbonized pretty 
substantially in about 15 to 20 years. They effectively went to 
80 percent nuclear-based power sources, which reduce their 
carbon emissions by a commensurate amount. Sweden was a similar 
time frame and a lesser but a similar impact. It wasn't quite 
the 80 percent that----
    Mr. Weber. Is France still at 80 percent today?
    Dr. DeWitte. They're a little less just because they 
haven't been building as many nuclear plants, and 
unfortunately, they're moving to shut some down, which is a 
terrible mistake.
    Mr. Weber. Okay. And do you know the grid size per chance 
of each of those countries?
    Dr. DeWitte. I do not but I know that they are smaller of 
course than the United States as it is, but off the top of my 
head, I think the French grid is somewhere slightly smaller 
than Texas.
    Mr. Weber. Okay. You were vocal about how--is it Oklo? Is 
that how you say that?
    Dr. DeWitte. Yes, sir.
    Mr. Weber. Oklo is funded through private investment but 
this is not the norm for innovative nuclear companies. Why did 
you choose that model?
    Dr. DeWitte. Because that gave us a pathway to get to 
market quickly. It also gave us a control over our own destiny 
so we weren't at the whims of either a project manager at some 
agency or at the political whims depending on what was going on 
of the government. It gave us insulation from that. It also 
gave us the ability to focus on what the market wants and not 
have to cater to what perhaps a grant maker wants.
    Mr. Weber. Refresh my memory. How long has the company been 
in existence?
    Dr. DeWitte. We started--we launched in 2013, and so it's 
only been about a little over four years.
    Mr. Weber. And where are you located?
    Dr. DeWitte. We're in Sunnyvale, California.
    Mr. Weber. Sunnyvale, California. Okay.
    Mr. Chairman, I'm going to yield back.
    Chairman Smith. Thank you, Mr. Weber.
    And the gentleman from California, Mr. McNerney, is 
recognized for his questions.
    Mr. McNerney. Well, I thank the Chairman. It's a good 
hearing, and I'm enjoying listening to your testimony. I think 
it's pretty bipartisan, and I look forward to continuing this 
discussion.
    Dr. Venky, would you describe the valley of death for 
technology and how the government can play a role in that?
    Mr. Narayanamurti. So as, you know----
    Mr. McNerney. Your microphone.
    Mr. Narayanamurti. Sorry. And I'll try to speak more 
softly. I tend to get excited.
    Mr. McNerney. I can understand that.
    Mr. Narayanamurti. I would like to say that it's good to 
have passion, though, to care about it, and I care deeply about 
us being number one, and my Bell Labs past taught me that. We 
always have the leading edge.
    Mr. McNerney. Valley of death question.
    Mr. Narayanamurti. Yes. So very early stages, if we take 
the transistor, the original transistor was a total clooch. 
Nobody ever thought you could actually make circuits out of it. 
So the first phase is to sort of make it something which you 
can actually make at least a few of. That's the first valley of 
death, to actually where is this just a good research curiosity 
and not really any technology. As you learn how to do this, 
there are of course various stages where you would decide to 
turn it off. The big valley of death comes a little bit before 
manufacture because then you have to literally make millions of 
them and actually invest a lot of money in that. So that--so 
it's a question of the investment where you go up in scale, so 
those two valleys of death are particular important, and the 
first one, there's no clear question that we have a role. 
That's exactly what ARPA-E or Energy Innovation Hubs, et 
cetera, do or Engineering Research Centers.
    The second one is for the very large issues, and there, you 
could argue where is the appropriate government's role. At the 
Harvard Kennedy School, when I first became Director of Science 
Technology Public Policy program in 2011, we convened a very 
large group including one of people from industry and a lot of 
people from government and academia to debate the government's 
role. It's actually there in that report, and there's not 
uniform agreement, but everybody agreed for some particular 
ones, it might be the nuclear case, it might be the carbon 
capture or storage, but there's a huge public-goods aspect 
where in fact you must have the options should in case 
something happen, and coal is an important commodity worldwide, 
that maybe there is a role. And then should there be some joint 
thing. Everybody agreed including the industrialists of some 
important points that things should be steady. We cannot let it 
be just simply political, i.e. it is a failure.
    Second, the companies must have a significant skin in the 
game. They must have something like 50 percent skin in the 
game, large skin in the game, and you could find that was the 
view of this workshop which I held, and of course, some people 
you may say for some things we don't have a role, the private 
companies should take it and just spend the money.
    Mr. McNerney. Thank you.
    Mr. DeWitte, in your opinion, does the fiscal year 2018 
budget proposal set us on the path toward energy dominance?
    Dr. DeWitte. I don't think it does. I think there's more we 
can do, absolutely. But I do think there are some good signs in 
there, particularly the appropriations for fast test reactor. 
I'm supportive of that. But I think we need to not lose sight 
of the fact that if we really care about dominating in the 
global space, the rest of the world is investing heavily and 
massively. We cannot lose sight of that. And we have to pay 
attention to that. But we also have to be focused and mindful 
about what the markets are wanting and needing and not just in 
the United States, and that's something that I think sometimes 
there can be a focus too myopically on. We need to look 
worldwide and how we can compete globally.
    Mr. McNerney. Could you discuss how federal investments in 
nuclear R&D have paved the way toward your company to succeed?
    Dr. DeWitte. Oh, absolutely. That's a cornerstone upon 
which we're building and all advanced reactor developers are 
building. That's an absolute, fundamental necessity that we are 
thankful was invested in.
    Mr. McNerney. Thank you.
    Dr. Venky, again, the department of Energy has four Energy 
Innovation Hubs and they're establishing a fifth one on the 
cross-cutting issue of the energy-water nexus, which was 
supported by the last Congress. Do you support the use of--
continued use of this model, especially with regard to the 
energy-water nexus?
    Mr. Narayanamurti. Yes. Unlike ARPA-E, which I've looked at 
in detail in my research, I know the Energy Innovation Hubs, I 
know the one at Argonne, which is run by George Crabtree in 
storage, I actually think it's a very important model. These--
the full impact will only be known about 10, 15 years down the 
road but we know from history from what NSF has done and what 
Department of Defense has done that these will be very 
valuable. So I--it will have to be a balanced portfolio and 
there do need to be certain critical areas where you actually 
combine strengths. Industry should be involved as well as the 
national laboratories and academia, and I actually think it's a 
very good model, one of the different ways of doing it.
    Mr. McNerney. Thank you.
    Mr. Chairman, my time went too fast. I'd like another five 
minutes.
    Chairman Smith. Thank you, Mr. McNerney.
    The gentleman from Illinois, Mr. Hultgren, is recognized.
    Mr. Hultgren. Thank you, Mr. Chairman. Thank you all so 
much for being here. This is an important hearing, and grateful 
for your work, and it is so important for us, especially as the 
Committee continues to look at ways in which the DOE can better 
assist the private sector as they do what they do best: 
innovate and bring new products to the market. Seeing firsthand 
how the national labs work at Fermilab in my district and 
Argonne just outside of my district, I've been able to see why 
the labs and our user facilities are often referred to as the 
crown jewel in our research ecosystem. I was glad to see stable 
funding for these facilities in the energy and water 
appropriations bill the Committee just reported, and I'll 
continue to keep fighting to see this in the final bill as 
well.
    I wanted to address my first question to all of you if any 
of you have comments on it, and wondered if you could just let 
us know in what ways did you specifically use federal funded 
research infrastructure like user facilities at the DOE 
national labs to develop your technology, and what other 
facilities should DOE be looking at and how could we change the 
operating practices of the labs to make them even more 
accessible to small business and startup developing innovative 
technologies.
    Mr. Narayanamurti. When I was at Bell Labs, we did much of 
our research work in supporting, for example, light source 
facilities at Brookhaven National Lab, at Argonne National 
Laboratory as an example because they are extremely important, 
and then when I was Vice President, I actually--of Sandia, we 
actually created photolithography where one can use some of 
these light sources at Lawrence Berkeley Lab, et cetera, to 
advance lithography techniques, but those are very--these large 
facilities including run by the Renewable Energy Laboratory, 
these are all extremely important including high-performance 
computing at Fermilab, at Argonne National Laboratory, and we 
still use them even in academia including the computing 
facilities. So test facilities are a crucial role and extremely 
important.
    Mr. Hultgren. Thank you. Anybody else?
    Mr. Kumaraswamy. I could offer a comment. I think one of 
the key areas that's being pretty helpful from the nation lab 
side has been looking at the benefits that storage brings to 
the grid. I think there's significant research that's being 
done by NREL, by PNNL and Oak Ridge Labs and many of the 
national labs towards establishing all of the values that 
energy storage bring to the grid, right, and so I think that's 
a cornerstone for us to make sure that all of the stakeholders 
that are involved in some these key decision-making processes 
are able to appreciate those benefits. Like I mentioned in my 
testimony, I think it's one where the private sector can 
significantly benefit from that type of research and 
computational models that are deployed at the national labs.
    Mr. Hultgren. Dr. DeWitte?
    Dr. DeWitte. I'd be happy to. We've benefited tremendously 
from the decades of research and development that Argonne led 
in advanced reactor development, and we're actively working 
with them now and the capabilities they and Idaho as well as 
Sandia and others have, and the GAIN program has tremendously 
help--been tremendously helpful in streamlining access and 
partnering.
    Mr. Hultgren. I'd like to follow up on that if that's all 
right, Dr. DeWitte. As you said, Oklo participated in the 
Gateway for Acceleration and Innovation in Nuclear, or GAIN 
program, which provides the nuclear community with access to 
the technical expertise at the national labs in order to 
commercialize these new technologies. I wonder, do you think 
these small-scale programs that provide access to technical 
support and lab capabilities are a better investment than 
providing large grants to move through the licensing process?
    Dr. DeWitte. In general at this stage in the advanced 
reactor industry, I do think they are more effective. I think 
as the industry grows and matures, it might be valuable to 
revisit that, but the impact that you can get and the return 
effectively on investment that you can achieve with these small 
grants that are targeted across a broad spectrum of areas. They 
yield really high-impact results for very little money. What 
we've done with a few hundred thousand dollars is frankly been 
phenomenal in our mind as well as the mind of our investors, 
very high impact.
    Mr. Hultgren. That's great. Dr. DeWitte, sticking with you, 
does working with DOE improve or slow down the process 
necessary for startups like yours to create and implement 
innovative technologies? What policy changes can be made at DOE 
to make their engagement with the advanced reactor community 
more productive?
    Dr. DeWitte. Yeah, I think the answer is, there's benefits 
and drawbacks at this point, and we're learning. Both parties 
are learning how to do this better and more efficiently. 
Contracting structures are being modernized and updated and 
general interaction mechanisms, and GAIN is very helpful in 
streamlining that process and identifying issues and helping 
address them, but the biggest single issue is DOE lacks the 
sense of urgency that the private sector demands. 
Unfortunately, in nuclear, we've gotten complacent in the 
industry like the pace of nuclear compared to the pace of our 
Silicon Valley peers is order of magnitude different. So we're 
trying to accelerate that, and DOE needs to, I think, 
recalibrate that and continue to strive to be more urgent in 
what they do.
    Mr. Hultgren. Is there anything we can do to help with 
that?
    Dr. DeWitte. I think one of the issues is, it's been 
helpful, I think, that you guys have done and will continue to 
do is through frankly Congressman Weaver's bill to open up 
access to the national laboratories and be able to partner with 
them in different ways both as user facilities as well as 
possible demonstration facilities. That and the impetus that 
that provides I think is a huge opportunity to help address 
that issue and otherwise continually revisiting that challenge 
and seeing what can they do to be faster and more efficient 
interacting with the private sector. It's just a constant 
learning process.
    Mr. Hultgren. Great. My time's expired. I'd love to follow 
up with you, but I need to yield back my time.
    Chairman Smith. Thank you, Mr. Hultgren.
    The gentleman from Colorado, Mr. Perlmutter, is recognized.
    Mr. Perlmutter. Thanks, and Mr. Hultgren on that side and 
Dr. Foster on this side like to talk about their labs in 
Illinois. They're like Illinois Chamber of Commerce, okay? So I 
want to talk about my lab and I want to start with you, Mr. 
Kumaraswamy, the National Renewable Energy Lab in Colorado, and 
if you could talk about the way that that lab assists you and 
others in making sure this technology that is being developed 
really is valuable to the citizens of this country, so if you 
could start there, sir?
    Mr. Kumaraswamy. Absolutely. I think they're doing some 
fantastic work at the National Renewable Energy Laboratory. We 
are grateful for that. One of the key areas of focus for us at 
AES is the application of using energy storage for peaking 
applications, so when we think about the country actually 
needing significant amounts of generation capacity that would 
run for a fraction of the time, right? That's what we're 
talking about when we talk about building new peaking gas 
plants.
    I think that energy storage is an extremely cost-effective 
alternative for building those peaking gas plants, and that's 
an area that we have continued to benefit from the NREL type of 
studies, right, because one of the areas of research that goes 
on at NREL is to make sure that you actually look at the 
benefits of using storage for the peaking application and 
produce those type of high-quality reports based on solid 
analytics and that helps us pursue these conversations 
regionally and nationally across many different stakeholders.
    Mr. Perlmutter. Thank you.
    And you know, Dr. Venky, you were talking about clean coal 
and nuclear and, you know, natural gas, you know, a couple of 
the others, and I think we need to have a whole diverse 
approach to our energy production, and so I have a slide up 
there which shows NREL working on photovoltaics, you know, 
starting back when the lab started at 76 bucks down to about 30 
cents, and there are some tax credits involved, and you know, 
part of what we're trying to do as a country is to provide a 
cheaper and better and less polluting as possible. So talk a 
little bit about that continuum of research.
    Mr. Narayanamurti. Thank you very much for that question. 
Actually, NREL is a laboratory where another postdoc of mine 
spent significant time looking at their portfolio and analyzing 
and talking to people.
    First I want to mention that we are not given a 
consistent--somebody asked how can this help. That technology 
transfer is an important mission and that we are proud of it. 
So NREL actually developed the first technology which led to 
First Solar, and First Solar is among the few highly U.S. solar 
companies which are not in China or Germany. This is extremely 
important and we should be proud of it, and we should actually 
celebrate it because it came. The cost of solar of course has 
been coming down very significantly and producing a lot of 
jobs. You talk about the jobs, and these jobs will be there no 
matter what. The energy system is going to be heterogeneous. It 
is going to require things like solar as well as storage as 
well as natural gas, and all of it on day one it'll evolve 
depending on circumstances, on geography, natural resources, et 
cetera. It's a worldwide issue so us working in this--but 
however, the way that DOE also needs to make this as an 
important strategy and can make it simpler but there are 
certain things the NREL lab directors and the laboratory people 
should have greater discussion of working across that boundary 
under some proper guidelines that are open and fair in those 
matters so sometimes it can be more interfering the way the 
Department of Energy might run it. Developing a coherent policy 
there would be valuable. It would help NREL.
    Mr. Perlmutter. Thank you.
    And Dr. Sant, so high school, college, law school, I worked 
for a precast concrete company, and I was in the laboratory and 
we'd do the cylinders and then crush them and see how strong 
they were based on different things that we added. So talk to 
me a little bit about how strong this CO2NCRETE 
using a byproduct that could be a pollutant or could be a real 
substantial ingredient, tell me how strong this 
CO2NCRETE really is.
    Mr. Sant. Good question. So in fact, about 65, 70 percent 
of all concrete in the world that's cast, so to speak, has a 
strength on the order of, let's say, about 30 megapascals. 
That's the kind you'd use to build a house. The stuff that 
we're producing is well within that territory so there's 
clearly a large accessible market you can reach out to.
    I will be careful to point out that we're not trying to 
look for opportunity to build hundred-story buildings. We're 
looking for opportunities to build everyday construction, which 
is really where the large volume of construction is, building 
as an example. It's also important to point out exactly in that 
spectrum that there's a unique opportunity here because as I'm 
sure you're well aware, the construction industry is not really 
very tolerant of cost escalation. We like the lowest bid, and I 
think what one of the opportunities that comes about with what 
we're doing is, we seem to have a real line of sight for being 
able to produce something that's cost-competitive as is, which 
is an important part because that's how you start to get 
penetration and diffusion.
    Mr. Perlmutter. Thank you, and I yield back to the Chair.
    Chairman Smith. Thank you, Mr. Perlmutter.
    Mr. Loudermilk. [Presiding] Give me a moment to get 
prepared after the move here, and now I'll recognize myself for 
five minutes for questions. That was convenient, wasn't it?
    Dr. DeWitte, I'd like to kind of follow up on something 
that you mentioned when you were having the discussion with Mr. 
Webster--or Weber. I'm sorry. You talked about stability, and 
it was the stability and where the government may be, what the 
reaction of the government is, and the lack of stability going 
forward when it comes to research and development, and I think 
that really hits upon a problem that we're facing today because 
politics is 90 percent emotion, and if we're good, ten percent 
logic sometimes, and I see you laughing because we're seeing 
that play out right now on the other side of Capitol.
    But historically, we've had agencies and other elements of 
government that had been that buffer between the whims of 
politicians and the science of research and development. They 
were that element that was there that focused on handling the 
politics on our side but buffering that from the research and 
development element of our society. The problem I see now from 
my perspective is that the political drive has filtered into 
those agencies. There seems to be a political element now 
within those agencies which we didn't have as much in the past, 
and some of that comes from talking with some of our research 
institutions in Georgia.
    I recently visited one of our research institutes--well, I 
visited in the last couple years several of them, and I asked 
the question, where do we need to go, what do we need to be 
doing, and there's two things especially when it comes to 
grants, that we're continually hearing the same concerns from 
our research institutions is twofold. One is the cost to manage 
the grant is going up, is extremely high, some up to 20 percent 
and even more spent on--of the grant money spent just on 
administration of the grant and reporting, and there's--I'm 
seeing that that is pretty consistent. And the other is that 
there's too much emphasis on short-time successes. In other 
words, there's no room for failure anymore but failure is part 
of the scientific process. I mean, if it wasn't--if Thomas 
Edison was receiving a modern-day grant, he wouldn't have 
invented the light bulb because, as he said, he didn't--his 
failures were 10,000 ways to prove something didn't work.
    So Dr. DeWitte, and I'll expand this out to others on the 
panel, do you see that? I know you're dealing with private 
sector and it makes me think that maybe that's some of the 
reason why you're not going to the government for funding if 
you would opine on that?
    Dr. DeWitte. Of course. Thank you for the question, and I 
think that's a very real situation. We recently made some 
decisions at Oklo with our investors and our executive team not 
to pursue certain federal opportunities for funding because the 
costs of managing that were too high. They just simply weren't 
worth it. And the other part of it is, often those can be 
targeted in a scope that's, like you said, so risk-averse that 
it's focusing merely on near-term objectives that really aren't 
moving the ball forward or they're not even looking at 
opportunities for finding impact in a market specifically, and 
as a result, you can kind of just miss the entire objective 
altogether, and I think that's a very real challenge today.
    Mr. Loudermilk. Dr. Sant, I noticed you were nodding at 
part of that. Would you like to----
    Mr. Sant. I think that is right. You know, very often I 
think a lot of goals end up being very narrowly focused, which 
means that you have to conform to a pretty narrow spectrum of 
ideas that even potentially look at, and also given the fact 
that there's limitations in how much risk you can take, that 
turns out to be problematic, but I think the part which also 
turns out to the harder is grant timelines turn out to be 
rather short. I know that most of them are three years, if 
you're really lucky, 5, and very often sustained work just 
needs much longer durations than that without an annual review 
deciding your fate, so to speak.
    Mr. Loudermilk. Yes, Doctor?
    Mr. Narayanamurti. A couple of comments on the same point. 
The Energy Innovation Hubs, et cetera, Energy Frontier Research 
Centers, are partially aimed at that longer-term issue, that 
is, five-year funded or four-year funded, same with the NSF, to 
encourage that, and some of that needs to happen.
    I think appropriate for this Committee is a lot of it's 
energy. The Department of Energy has been studied a lot 
including the national labs, which are our crown jewels, and 
the Senate Committee has made recommendations including how the 
costs in the DOE might be minimized, et cetera, which would be 
quite important in tackling the kind of problem you're asking 
about, in fact, the reporting requirements, et cetera, which 
would ease some of the burden and get more effect for the 
actual work being done.
    Mr. Loudermilk. Well, thank you, and this is something that 
has been a passion of mine is reforming our grant system to 
reduce that cost so more of the money will actually go into the 
research and development and also allow for longer term 
because, you know, failure is part of scientific research. So 
thank you all for being here.
    At this time the Chair will recognize the gentlewoman from 
Hawaii, Ms. Hanabusa.
    Ms. Hanabusa. Thank you. Thank you very much, Mr. Chairman.
    Dr. Venky, I am a great friend of DARPA. I've sat on the 
Armed Service Committees for years, and DARPA, in my opinion, 
has been one of the best hidden secrets that the Department of 
Defense has, especially in terms of its ability to innovate and 
its structure. Some have described it as 100 geniuses running 
all over the place with a travel agent kind of moderating, so 
it doesn't have the usual bureaucratic structure that we think 
about.
    You have testified that you've spent a lot of time looking 
at the structure of ARPA-E, and as you know, in the Trump 
budget, his proposed budget, there's only about $20 million and 
it's really to transition the demise of ARPA-E. Can you first 
tell me from your perspective and what you know about how ARPA-
e operates its importance and its significance as well as the 
kinds of research that you can point to that have been actually 
very critical for the Energy Department?
    Mr. Narayanamurti. Thank you very much for asking that 
question. I feel quite passionately about ARPA-E because it's a 
very important innovation in the Department of Energy. You 
know, we all value peer review. Peer review is important, but 
it has its limitation because it leads more to the average, and 
so ultimately you need program managers who are technically 
savvy, know the people and the work which is being done, and 
will consult obviously--you cannot just do it arbitrarily but 
try to actually pinpoint high risk and high reward where there 
are actually people who are evaluating the very high-risk part 
and then they would look at that, take an average, look at that 
distribution and by judgment make some high risk, and that's 
what ARPA does too. So it's an important innovation in the 
management system where you combine some good aspects of peer 
along with judgment, and especially with regard to high risk.
    The other thing which when we looked at many of the awards, 
we looked at--my postdoc looked at some 4,000 awards which were 
given by APRA-E. You should remember it's still early. It's 
only five years old. But what we found was that there was many 
scientific papers which were published in leading journals like 
Science and Nature and their impact was similar to that 
published in the Office of Science and yet there were a large 
number of patents. There were very few patents from the Office 
of Science. So that tells me ARPA-E is not being negligent in 
its science but is also developing new technology, i.e. the 
other is a missed opportunity. So I'm very positive of that 
aspect.
    And then in its early stage, there are some examples. The 
National Academies recently issued a report that actually I 
didn't know that. A colleague of mine at Harvard, Joanna 
Eisenberg, whom I hired a long time ago, she has developed some 
very narrow biomaterials which actually now are going to the 
Nature paper. Another colleague at Advanced Storage, battery 
flow, which is also scientific as well as leading to a company. 
So there are different forms here, and the early prognosis is 
good, and my guess is, it is a very important innovation along 
with Energy Innovation Hubs and Energy Frontier Research 
Centers to want to have portfolio.
    Ms. Hanabusa. So what do you think is going to take its 
place, if anything can take its place?
    Mr. Narayanamurti. Oh, I hope it does not--I hope in the 
end--I believe including ARPA-E and much of this work was often 
a bipartisan. I really believe this should be bipartisan. It is 
for the country. And that doesn't mean the program manager is 
always going to choose exactly the right one. That is not--even 
private people don't do it. And these are risky but there 
should be some successes, and it should be bipartisan. I hope 
it really is funded.
    Ms. Hanabusa. Mr. DeWitte, when Dr. Venky was speaking, I 
saw you nodding. Do you have an opinion of ARPA-E?
    Dr. DeWitte. It's an interesting question. I do. I mean, 
we've supported different, I guess, workshops, if you will, and 
have been rather impressed by some of the activity that's gone 
on. However, one of the things that I think--it's an early-
stage organization, and it's still growing in a lot of cases 
and still has a lot of upside. That said, it has struggled, I 
think, and we've seen certain struggles of it being a little 
too academic in certain areas. That's not always a bad thing, 
though. I just think it's a matter of making sure you have an 
organization that continues to learn because some of these 
things should be able to afford to fail and learn and grow from 
that. That's something that we really like to see happen.
    Ms. Hanabusa. Thank you.
    Mr. Chair, I yield back.
    Chairman Smith. Thank you, Ms. Hanabusa.
    And the gentleman from Louisiana, Mr. Higgins, is 
recognized for his questions.
    Mr. Higgins. Thank you, Mr. Chairman.
    Gentlemen, thank you for appearing before this full 
Committee. Your combined IQ is frighteningly high and a welcome 
transition from some of the things we witness in Congress.
    Representing a state that is recognized as perhaps the 
Nation's leader in the oil and gas industry, I witnessed 
regulatory overreach over the last decade to push the American 
oil and gas industry to the shores of other countries, and 
considering the totality of circumstance of the world's 
ecology, my personal opinion is that it's a psychologically 
unsound logic.
    So Mr. DeWitte, my question is for you, sir, regarding 
nuclear technology. Nuclear energy is one of the most heavily 
regulate industries in the United States, and we must balance 
the benefits of nuclear energy with potential safety risks and 
ecological concerns. These regulations can impede the potential 
for the export of U.S. nuclear technology but we must recognize 
that a high regulatory burden on exports in the United States 
could work against nuclear safety worldwide and security goals 
if it allows less regulated technologies form countries like 
Russia and China to reach new nuclear markers. What types of 
regulations do you believe, sir, are unnecessarily holding back 
the export of U.S. nuclear technology?
    Dr. DeWitte. Thank you very much for the question. I'm very 
passionate about this issue because it's a huge hindrance to 
global leadership in nuclear and it's something that we really 
actively as a country need to reevaluate because, like you 
said, our barriers we're self-imposing are preventing us from 
being a massive world player that we should be here but also 
ceding the opportunities to frankly less mature and less safe 
and less beneficial competitors, and the reality is, we need to 
reevaluate that at the DOE level as well as the Department of 
Commerce, the NRC and the Department of State.
    In the last ten years or so, there's been significant 
changes to the rules about export controls in nuclear that have 
been very detrimental. They've gone in the wrong direction. The 
expectations that were set in terms of exporting reactors to, 
for example, the UAE when we were negotiating those deals 8 or 
so years ago were misguided and have set the wrong expectations 
and the wrong standards that aren't aligned with what frankly 
the U.S.'s goal and the global goals for nuclear deployment 
should be. We need to reevaluate those and we have to do it now 
because it's affecting us today.
    Mr. Higgins. Thank you for that answer. I concur. Would you 
have specific recommendations perhaps you could provide this 
full Committee in writing over the course of the next month or 
so whereby we may consider your recommendations, sir----
    Dr. DeWitte. I would be----
    Mr. Higgins. --as we attempt in a bipartisan manner to 
consider of course ecological concerns of our planet while at 
the same time recognizing the superiority of clean United 
States technology regarding energy development?
    Dr. DeWitte. I would be happy to. American nuclear 
technology is the best so I'd be happy to do that.
    Mr. Higgins. One more brief question, if I may. The 
Department of Energy has recently made improvements to its Tech 
to Market and Technology Transitions programs. However, many 
companies still struggle with tech transfer contracting 
procedures that can take up to a year to complete. From your 
perspective, how could the federal government streamline 
public-private partnerships and ease access to taxpayer-
supported research?
    Dr. DeWitte. I'll take a first go at that. I think one of 
the issues that we've seen is the fact that the contracting 
structures and the liability bases that the labs are 
effectively using to make their determinations are out of touch 
with what the objectives of the national labs really should be 
to the point that it's--they're afraid to do anything. We need 
to reevaluate that. It gets to a more fundamental question I 
think is, what are the contracting structures for the operators 
of the national labs? Bell Labs operated Sandia Labs in a 
beautiful way and in a way that centered around advancing the 
national interest and achieving and growing national 
excellence. I think we've lost that today. I think it's time to 
reevaluate some of that so we can get back to what the core 
mission and the core capabilities of the labs are. I think 
that's one of the starting points, and there'd be some others, 
but for the sake of time, I'd be happy to defer those to 
writing.
    Mr. Higgins. Thank you. I would appreciate that. I believe 
your colleague has a comment.
    Mr. Narayanamurti. I want to just second this aspect here. 
It is very important that the DOE is now actually having a 
technology transfer lab and a lot of it can be done at the 
laboratory level, people that understand the technology 
closely. That was our finding with NREL so I think reform and 
really recognizing strategically would add greatly and improve 
our technology transfer.
    Mr. Higgins. Thank you, sir. Gentlemen, thank you.
    Mr. Chairman, I yield back.
    Chairman Smith. Thank you, Mr. Higgins.
    And the gentleman from New York, Mr. Tonko, is recognized.
    Mr. Tonko. Thank you, Mr. Chair, and thank you to all of 
our witnesses for participating in a very interesting hearing.
    The only way we are going to meet our energy challenges is 
through investments in research and development. We cannot lose 
sight of the vital role that government plays in innovation. 
The federal government must be an active partner with our 
universities and certainly with our private sector.
    Having an R&D portfolio that covers the spectrum from basic 
sciences to technology development, testing and deployment 
greatly augments the work being done by the private sector and 
in the university community, and sustained support of these 
efforts is essential to lowering costs and improving 
performance of our energy technologies.
    Dr. Sant, can you tell us a little bit about the role 
federal agencies have played in supporting your efforts?
    Mr. Sant. Of course. Happy to answer. So federal agencies, 
like I said, the Department of Transportation, the National 
Science Foundation and the Department of Energy have all funded 
our work. It's all been funded at early stage. We're in a 
university. However, the important thing to point out is that 
we've been able to access support from each of these agencies 
that is really, really very strategic. It's come together to be 
able to address questions that are very narrow but we're very 
interested in. For example, we're interested in trying to 
understand how to really take building materials, which 
literally eat carbon dioxide. There's two parts to this. So of 
course while we look at the basic to the applied continuum, 
while we're working at the basic part, we need support going 
all the way into the applied end of the spectrum, and the 
reason that I say this is, while we do things in a laboratory 
and it's easy often to realize successes, the challenge that 
you often run into is that as you start to scale up, there are 
things that don't work, which require you to go back to the 
lab, and so you need this pathway where you can stage research 
and funding dollars to be able to go across the entire pathway, 
and that's how you succeed in taking ideas and converting them 
into innovation and then translating them into technology.
    I think this is especially important to point out with 
conventional industries, for example, like the energy sector, 
the construction sector, which have very limited risk 
appetites, so to speak, and that's why it's very necessary for 
the government to underwrite a larger portion of the R&D 
pathway than would be typical, for example, let's say, in the 
semiconductor space, and hence I think it's extremely strategic 
that agencies keep this in mind as funding decisions are made 
because it has implications on timeline and how you focus 
investment to go from ideas to wins that you can translate 
globally.
    Mr. Tonko. Thank you. And you talked about that carbon 
footprint in your comments slightly. The DOE's Office of Fossil 
Energy----
    Mr. Sant. Yes.
    Mr. Tonko. --has been working to reduce greenhouse gas 
emissions through their fossil energy research, and you've been 
involved in that somewhat?
    Mr. Sant. Yes, so we are actually funded at this point 
through the National Energy Technology Laboratory.
    Mr. Tonko. Wonderful, and certainly I agree that across the 
field we need to develop technologies to reduce our carbon 
footprint, which is what I'm very proud of in terms of 
supporting a bill to make advanced gas turbines more efficient. 
The gas turbine R&D bill that I'm carrying with a fellow 
Republican with authorize DOE's Office of Fossil Energy to 
carry out a multiyear, multiphase R&D program to improve the 
efficiency of gas turbines used in our power generation systems 
and to identify the technologies that ultimately will lead to 
gas turbine combined cycle efficiency of 67 percent, what might 
seem just like a trivial improvement but tremendously important 
in terms of electrons saved.
    If Members of Congress are going to claim to support an 
all-of-the-above energy philosophy, then we need to support and 
fund an all-of-the-above research strategy to complement it. 
That means supporting robust funding for EERE and certainly for 
ARPA-E.
    Dr. Venky, we know that ARPA-E plays a critical role in 
expanding our portfolio of innovation programs and lowering the 
risk on projects that would not be supported by the private 
sector. Can you give some examples of how the products, 
processes, fuels or technologies that have been developed as a 
result of ARPA-E's investments are changing our energy system 
and addressing the challenges we face?
    Mr. Narayanamurti. As I mentioned to another question from 
the Congresswoman from Hawaii, the National Academies recently 
issued a study. Of course, ARPA-E is still in the early stages, 
only four years old or something like that, but there are 
several examples we see highlighted. One was actually from 
Harvard with the slip-on technology, and I know of work that is 
done at Santa Barbara, Gallium Electronics, which has blossomed 
significantly, and as I mentioned in my previous response, they 
also have been doing some very good science. It's really a 
missed opportunity if you don't do them together. It's really--
there's so many good examples. They're the right track, and I 
will hasten to bet that ten years from now with the fullness of 
time, we're going to have lots of examples because there's both 
good science being done and patents being created.
    Mr. Tonko. Thank you. Thank you very much.
    I'm out of time, so Mr. Chair, I yield back.
    Chairman Smith. Thank you, Mr. Tonko.
    The gentleman from Texas, Mr. Babin, is recognized.
    Mr. Babin. Thank you very much, Mr. Chairman, and I 
appreciate all you witnesses being here today.
    Dr. Sant, I would like to ask you a couple of questions if 
you don't mind. Can you explain the upcycling process in 
layman's terms?
    Mr. Sant. Sure.
    Mr. Babin. And how the process differs from traditional 
approaches to carbon utilization if you don't mind?
    Mr. Sant. Sure. So in a brief sentence, we can define 
upcycling as beneficially utilizing a waste so it's this idea 
of converting trash into treasure. We combust fossil fuels, we 
emit carbon dioxide from the stack. The work that we're focused 
on is really trying to take that carbon dioxide and reutilize 
it. Now, the way we reutilize it is, we use this compound 
called calcium hydroxide, which you produce, for example, by 
either burning limestone and emitting CO2 and so 
hence it lets you keep the same mineralized CO2 
within a loop so that's how you reuse it. The other way you can 
actually produce calcium hydroxide is by using alkaline waste 
that you get from industries like slags and fly ash as an 
example and extracting calcium and magnesium ions out of those. 
So what you're really looking at doing is creating, let's say, 
a chemical sponge to soak carbon dioxide, and over the course 
of that reaction, you undergo a transformation to produce 
limestone.
    Now, an important thing to point out about this upcycling 
process is the reason it turns out to be very attractive is it 
gives you a strategy for both avoiding and reducing the amount 
of carbon dioxide you would produce otherwise by producing 
traditional ordinary Portland cement. That's an important thing 
because what you can do with this approach is, you can create 
an offtake partnership so essentially a power producer can work 
alongside a cement producer since both of them emit CO2 
but one produces a material that can potentially soak up 
CO2. You let these industries actually start to work 
together.
    I think the sector-level synergies are extremely important 
to catalyze because as you go forward and we look at this idea 
of trying to create new synergies and new efficiencies in the 
energy space, we need to get industries that were otherwise 
not, let's say, correlated with each other, interacting with 
each other.
    Mr. Babin. All right. What is--if this was a widely 
deployed process throughout the land, what would be the impact? 
Would it be dramatic? Would it be a partial impact? Please let 
me know what you think there.
    Mr. Sant. Sure. That's a very good question actually. So if 
we assume global scaling of some of these processes which 
utilize carbon dioxide, landscape analysis that we have done 
and others have done shows that you can basically use up to 
about ten percent of global CO2 emissions, right, so 
it's on the order of let's say three or four billion tons. Now, 
ten percent seems like a small number. It's actually a really 
important number because what you're really showing is a value 
system and a pathway to creating value that you cannot utilize 
otherwise.
    So when you look at concrete, which is one way that you can 
utilize CO2, or plastic, which is another way to do 
it, by creating value, you show that there's opportunity where 
there was none, and I think that's something which is 
important, for example, for industry to be able to see because 
we are very often used to seeing carbon dioxide as a negative. 
What we're trying to do is really create this positive 
perception which is associated with revenue generation because 
that helps you really create longer-term pathways which are 
associated with more risk which do of course render a more 
permanent solution but you want to get points up on the board 
before you go for the big ones every time.
    Mr. Babin. Okay. And then just to maybe enhance what you 
just said, in what way can your upcycling technology 
potentially surpass more traditional CO2 utilization 
such as through the use of captured carbon for enhanced oil 
recovery, for example?
    Mr. Sant. So one of the really important things about the 
work that we're doing is that we can utilize flue gas without 
any pre-processing or without any post-processing, so an 
important aspect as to what really drives up the cost that's 
associated with carbon capture as an example utilization is 
lots of these processes require enriched or purified 
CO2. The way our process is designed is we can 
basically take flue gas that comes out of a stack in a power 
plant or in a cement plant or a petrochemical facility and use 
it directly as a reagent in our chemical process. I think this 
is an extremely important point because the cost of capture is 
really a limiting step at this point, and if you can start to 
utilize flue gas without a capture cost, now you really start 
to see some economic viability that can start to model these 
processes.
    Mr. Babin. Okay. Thank you very much, and I yield back, Mr. 
Chairman.
    Chairman Smith. Thank you, Mr. Babin.
    And the gentleman from Virginia, Mr. Beyer, is recognized.
    Mr. Beyer. Thank you, Mr. Chairman, very much.
    Dr. DeWitte, I was fascinated by all your conversation, 
your work on the small nuclear reactors. I was sitting next to 
Congresswoman Jackie Rosen from Nevada, and she was sort of--I 
don't want to mischaracterize but instantaneously anxious about 
the fuel. So I pointed out the first page of your testimony 
about how you're reusing fuels from some of the other places 
including the plutonium. At the end of the day, is storage 
still a problem or an issue that has to be solved with respect 
to the small nuclear reactors?
    Dr. DeWitte. In terms of waste storage?
    Mr. Beyer. Yes.
    Dr. DeWitte. It's a different problem but it's a very much 
smaller problem in the sense that the output effectively is 
going to be something that's radioactive for nominally 300 
years at most, at most, and a very small volume of what you 
would produce otherwise. So really, what we're doing today is 
we're taking fuel. We're only extracting about one percent of 
the total energy content in that fuel and then we're putting 
it--trying to dispose of it. What we're trying--that's what 
we're doing today. What we're trying to do and what other fast 
reactors can do is take that and extract basically the rest of 
that 99 percent energy content out. Now, there's still some 
radioactive material at the end of the day but you can safely 
store that. It only needs to last for a couple hundred years 
before it decays away to nothing. At that point you can have it 
vitrified. You can make glasses out of that you could drink out 
of, in fact, so it would be perfectly safe. It's a very 
manageable problem at that point.
    Mr. Beyer. The sense I'm getting from your testimony is 
that the development of your fast reactor technology to scale 
could solve a lot of the disposal problems of the bigger 
reactors that we have already.
    Dr. DeWitte. Absolutely. It changes it from a problem to 
really an opportunity because now you have a bunch of fuel that 
we could power the United States on for hundreds of years, like 
all of the United States power needs, so it's a phenomenal 
opportunity.
    Mr. Beyer. You talked a little bit I know before about the 
Nuclear Regulatory Commission and they've been adapting to 
small rather than big. How about the insurance companies, you 
know, the liability and--are they still treating you like Three 
Mile Island or----
    Dr. DeWitte. That's an excellent question, and I think it's 
a question that needs to become more prevalent and mature going 
forward. There's a lot of differences between small reactors 
and advanced reactors in terms of what the potential risks are, 
the potential consequences, and therefore what the liability 
should be and what the insurance capabilities need to be, and 
generally it's a much smaller footprint, it's a much smaller 
need, so the current framework in some ways and in some cases 
is kind of--it's inefficient. It's not set to actual technology 
capabilities today, and that needs to modernize, and I think 
that conversation in general needs to pick up. Frankly, now is 
the time to do that.
    Mr. Beyer. Thank you very much.
    Mr. Kumaraswamy, I've had many conversations with folks in 
your business about the exciting role that batteries can play, 
especially when you think about power plants as a step by step. 
Do you see this as also promoting clean energy, reducing 
emissions, having a role in a 21st century electric grid?
    Mr. Kumaraswamy. Absolutely. I think the way we see is that 
it gives us the capability to recouple the demand and the 
supply piece, which gives us transformational capabilities, 
right, and so again, like I said, it has significant potential 
for you to think about increasing the efficiency that we 
operate the existing system with, both in the general and the 
transformation and distribution side. It's a question that we 
get asked all the time about whether storage or generation or 
transmission or distribution, and it's all of the above really, 
right, because it is able to play into all of those areas that 
we have traditionally assumed to be pretty bifurcated. And like 
I said previously, when we are faced with a future where the 
baseload generation plants are facing retirement decisions and 
we're continuing to add more renewable sources into the grid, 
there's a need that you have to add more peaking capacity into 
the grid, and the most cost-effective way of providing the 
peaking capacity is through deployment of large-scale energy 
storage.
    Mr. Beyer. Are you working with Elon Musk and all these 
electric cars and steering wheels--cars without steering 
wheels, things like that?
    Mr. Kumaraswamy. I buy some of the products.
    Mr. Beyer. Dr. Venky, you know, one of the criticisms 
that's often come from my friends on the other side about 
Department of Energy was picking winners and losers and 
interfering with the free market by crowding out private 
investment, but you worked at Bell Labs, you worked at Sandia 
National Laboratory, how do you perceive this or what's been 
your experience about the federal government having a role in 
these things?
    Mr. Narayanamurti. Well, I--first of all, there are many 
forms in which you can actually interact with industry. With 
the early stages, take ARPA-E. They are having wide 
solicitations. They ask for a lot of different proposals. They 
get reviews of them, and obviously some people get selected, 
some don't. This is true for even academia. So it's a very 
quite robust process but your risk case is not going to be 
perfect. In a sense, you must pick winners and losers, so to 
speak, and hopefully the ARPA-E program managers are wise 
enough that--and long term of course--so I just don't see that 
argument at all as long as the process is fair and this is how 
it is done. It's always a judgment question. This is true. I 
complain when my grant is not approved. Was it unfair to me? 
You know, as long as the process was robust.
    So the other feature which I think is important is there 
are many different kinds. There can be joint agreements with 
industry where they're actually putting skin in the game and 
say we want your help. There's cooperative research and 
development agreements. So we should allow for different forms 
and different industries but the early-stage part, I don't see 
that as an issue. Even in the very long range, as long as we 
have an open process and we have this thing properly 
documented, that would be great.
    And the Loan Guarantee program has been under debate. 
That's the one where you can actually have a serious argument. 
It of course has to be done with much greater care because the 
amount of investment is huge.
    Mr. Beyer. Thank you, Doctor, very much.
    Thanks, Mr. Chairman.
    Chairman Smith. Thank you, Mr. Beyer.
    And the gentleman from Kansas, Mr. Marshall, is recognized 
for his questions.
    Mr. Marshall. Thank you, Mr. Chairman. My first question's 
for Dr. Sant. Dr. Sant, Chairman Smith and I had the 
opportunity to recently see what we believe is the country's 
largest 3D printer at Wichita State University, and one of the 
technologies they showed us was additive manufacturing to the 
3D printing, and they described it as a potential game changer 
for manufacturing. Can you talk a little bit about how you 
think they could use this additive technology to manufacturing? 
Would it help you scale up your technology?
    Mr. Sant. Yes. So actually we are working on additive 
manufacturing, specifically related to construction systems. In 
fact, there's great opportunities. An important part of what 
we're working on, and I think we've stumbled into this but it's 
turned out to be a major opportunity. The material that we're 
working with is much easier and must better suited for additive 
manufacturing than traditional concrete, and this turns out to 
be quite an advantage for a variety of reasons. So traditional 
concrete that amongst the poorest what you call strength-to-
weight ratios of synthetic materials, using additive 
manufacturing components lets you use materials a lot more 
effectively so if you imagine that you can produce structural 
elements--beams, columns and slabs--and take them out to a 
construction site and start to assemble them kind of like a 
large Lego set that has major impacts on the construction 
sector because it really starts to improve construction 
productivity. If you can imagine--very often we heard of 
construction projects being delayed. If you can imagine you're 
taking prebuilt sections out on site and starting to assemble 
those, that's a much more efficient process to be able to 
construct with much more efficient systems so additive 
manufacturing clearly in our minds is the path forward as far 
as construction goes.
    Mr. Marshall. Well, thanks, and what I'm going to always 
remember is they showed us the structure of wings for 
airplanes. They of course manufacture lots of airplane stuff in 
Wichita, and they basically told the computer to make it 
stronger and it ended up looking like a bird's wing and just 
the micro structure of it.
    I'll go to Mr. Kumaraswamy next. Battery storage is a huge 
issue obviously. A third of the energy in Kansas is now 
generated via wind energy, and the storage of that wind energy 
is always the challenge, and we hope to--we are already an 
energy exporter from Kansas, so just talk a little bit about 
your technology. As I understand and read your process, it's 
a--your batteries are side to side to side. What's the future 
look like for battery storage or what's your vision and where 
do you think we're going with this?
    Mr. Kumaraswamy. Sure. That's a great question. We--the 
product that we have, which is called Advancion, is an energy 
storage platform. We are not a battery manufacturer company so 
we actually buy batteries from many different certified 
suppliers. It's a platform that we have that we have developed 
that actually has some unique advantages in terms of serving 
the grid. It's pretty modular in terms of the architecture that 
we have come up with, and again, we are in a leadership 
position in deploying energy storage solutions both nationally 
in the United States and globally.
    For the specific issue that you mentioned, there are 
significant applications of energy storage, so if you have 
intermittent variable generation, one of the issues that you 
have is making sure that the time in which the generation 
actually is produced aligns with the peak times in which the 
demand occurs on the grid condition, right? And so oftentimes 
what we see with both wind and solar generation is that there's 
a misalignment of when the generation production happens and 
when the demand for electricity happens in the late evening 
hours when people actually come back home, and that's one of 
the applications of energy storage is the ability to actually 
move all of the generation that's happening in the early 
afternoon periods towards the early evening periods when the 
demand hits its peak, and we are currently deploying some of 
these longer-duration storage projects also.
    We have a project that's currently under construction in 
California. It's 100-megawatt, 400-megawatt-hour energy storage 
project so it's 100 megawatt, 4 hours of duration project. So 
think about moving your generation from the 4 p.m. hour to the 
8 p.m. hour. That can be completely done, and we think that 
it's the most cost-effective way in which we can accomplish 
that objective.
    Mr. Marshall. Are these still just commercial batteries 
side to side to side to side or what's that look like?
    Mr. Kumaraswamy. It's lithium-ion batteries. The Advancion 
platform that I mentioned is largely agnostic to technology. We 
basically look at whatever technology makes the most amount of 
sense for our customers, which are utilities in most cases, but 
to date what we have found is that lithium ion has the best 
amount of efficiency and cost-effectiveness right now, and as 
far as we can see, that still applies at least in the next 2- 
to three-year time frame with the synergies that lithium-ion 
technology has with the transportation sector on the electric 
vehicle side. It still continues to be the technology that we 
are anticipating will provide the characteristics that can be 
helpful for the grid.
    Mr. Marshall. Thank you. I wanted to talk nuclear 
engineering but I'm out of time. Thank you, and I yield back.
    Chairman Smith. Thank you, Mr. Marshall.
    And the gentleman from Florida, Mr. Crist, thank you for 
your patience.
    Mr. Crist. Not at all. Thank you, Mr. Chairman.
    And thank you to all the panelists for being here today to 
share your unique perspectives on energy technology research 
and development.
    I'm from Florida, the Sunshine State, where our energy is 
our economy and our environment. Protecting our natural 
resources is of the utmost importance to myself and the 
constituents I represent. That's why I'm extremely interested 
in increasing the use of clean energy to meet our environmental 
needs, particularly in the area of solar.
    Mr. Kumaraswamy, from my understanding, better energy 
storage technology could help the United States to greatly 
expand our portfolio of zero-emission energy sources. Can you 
discuss how energy storage can be combined with renewables like 
solar and wind to help reach our clean energy and environmental 
goals?
    Mr. Kumaraswamy. Absolutely. Just also as a note that the 
United States actually has a leadership position in terms of 
deployment of grid-scale energy storage. I think as of 
Bloomberg data that's a couple of months old right now, we have 
more than 30 to 40 percent of the global energy storage 
installations across the whole world. So it's something that we 
should be proud of.
    And energy storage, again, you know, it's one of those 
things where there's significant potential for using that along 
with renewable energy technologies like solar and wind. AES 
actually is currently also developing a project in Kauai at the 
end of Hawaii which is a combined solar plus storage project, 
right, and so it's a combination of solar technology and 
battery-based energy storage technology to make sure that you 
almost create a firm block of power that can be developed to 
the grid. Like I was mentioning previously, one of the things 
that you had to worry about if you have intermittent variable 
generation is the misalignment of when the generation occurs in 
the system and when the demand actually peaks, and storage is 
the glue that can help you bridge that gap that you have in the 
system.
    And the other issue is also that in several cases what we 
see is that when you keep adding more variable generation to 
the system, there's a tendency for us to think about adding 
more peaking gas plants to balance all of the generation. In 
our view, it's not the most prudent choice to add capacity into 
the grid that runs for like a fraction of the year, right? If 
you think about peaking gas plants that we have across the 
country, the average capacity factor of that is something like 
5 to six percent of the year. In an economy where we're moving 
towards shared services in pretty much every commodity that we 
think about. If we think about Air BnB on the hotel side or 
Uber for the transportation side, we are thinking about shared 
services, right? So in that economy, we think that if you make 
multibillion-dollar investments into peaking gas plants but run 
for a fraction of the year, that's just not in the best 
interest of ratepayers, and I think storage would be a lost 
more cost-effective in performing that function.
    Mr. Crist. Is the same type of energy storage equally 
suited to grids powered by different energy sources, wind 
versus solar versus natural gas versus coal-fired power plants 
or would it make more sense to use several different types of 
energy storage?
    Mr. Kumaraswamy. The storage itself is agnostic again to 
the type of generation that you have. It just gives you the 
capability to store energy and release it at a later point in 
time, right? And so it's agnostic to whether it's coal or 
natural gas or any other source that you actually use to charge 
but again, in many markets that we have gone into, we have seen 
significant benefits including environmental benefits that 
additional storage brings to the grid.
    Part of the reason is also that it lets you optimize the 
existing portfolio of generation plants to operate more 
efficiently, right, because as the demand keeps changing, power 
plants keep moving up and down, basically they're consuming 
more fuel or less fuel to balance the needs of the grid, right? 
If you add storage into the system, the storage actually is 
able to take up the job of moving up and down to balance the 
demand conditions, letting the existing power plants operate 
much more efficiently which means that they're running at 
better heat ray blocks, at better efficiency blocks, which 
means that their emissions go down, so that's a significant 
benefit that we have seen in some of these markets.
    Mr. Crist. Well, thank you. It's clear to me that we need 
greater energy storage in America. What can the federal 
government, Congress in particular, do to help encourage 
additional research and development in this field, in your 
view?
    Mr. Kumaraswamy. Like I mentioned in my testimony, I think 
on the lithium-ion side of the house, I think the technology is 
stable. There's a lot of private capital that's chasing more 
innovation like improving cell density and production and costs 
and all of that, so I think private capital will continue to 
push that forward.
    There is a significant role for us to make investments in 
early-stage R&D on other promising battery chemistries that 
have greater potential in the near future like extending the 
duration in which you can actually storage energy, right? So I 
think that's an area that the government should continue to 
focus on.
    And I think the second and most important area is also that 
we want greater recognition of the benefits that storage brings 
to the grid, particularly for applications like peaking 
capacity. When we go and talk to regulators across the country, 
it's one of those common questions that we bring up all the 
time, which is how does it compare with a peaking gas plant, 
and it's an apples-to-oranges type of comparison because a 
peaking gas plant has to be turned on to provide a service and 
then it shuts off, and when it shuts off, it can't provide a 
service. In contrast, energy storage is a 24 by 7 resource. 
It's connected to the grid all the time. So when you need that 
peaking capacity, it's able to discharge and provide you that 
capacity, and for the remainder of the day or the remainder of 
the time, it's actually able to provide for other ancillary 
services that are needed for the grid.
    And so the other area of focus should be continued 
investments in the national labs to make sure that there's 
awareness of all of the benefits that storage brings to the 
grid.
    Mr. Crist. Thank you. Thank you very much, Mr. Chairman. I 
yield back.
    Chairman Smith. Okay. Thank you, Mr. Crist.
    And again, thank you all, our experts, for being here 
today. The testimony to me was very informative and very 
valuable to us.
    The record will stay open for a couple of weeks in case 
Members have additional written questions they want to submit, 
and that concludes our business, and we stand adjourned.
    [Whereupon, at 12:12 p.m., the Committee was adjourned.]

                               Appendix I

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