Obama's Energy Plan Faces Tough Road, History Suggests

Jeremy Hsu

Date: 23 March 2009 Time: 02:04 PM ET

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A national need for clean energy may require a U.S. government response rivaling the Manhattan Project or Apollo Program, but history suggests that tackling an energy crisis remains more difficult than building an atomic bomb or going to the moon.

Those historical analogies came up once again just before President Obama spoke today about how part of the $787 billion stimulus bill will promote clean energy investments. Energy entrepreneurs and leaders of the research community sat in attendance at the Eisenhower Executive Office Building near the White House.

"President Obama is challenging the nation to make the largest [science and technology R&D] commitment since Sputnik launched the Apollo program," said Susan Hockfield, president of MIT, during her remarks just before President Obama's speech.

Many private and government leaders have made similar comparisons over the years, invoking times of national crisis when the United States marshaled its resources to develop the atomic bomb during World War II or develop a space program to race the Soviets to the moon.

The comparison may hold true as far as the imagined scale of response needed to deal with issues such as climate change or energy security. President Obama's plan includes $39 billion under the U.S. Department of Energy's budget, with $6.5 billion going directly into energy research and development (R&D).

"We can remain the world's leading importer of foreign oil, or we can become the leading exporter of renewable energy," President Obama said in his speech.

Still, government investment on the scale of the Manhattan or Apollo efforts may not do the trick by itself. A report published in February by the Congressional Research Service (CRS) cautioned that the energy challenges faced by the U.S. today are more complex than anything faced by the Manhattan Project or Apollo Program.

That CRS report compared earlier U.S. government efforts with later federal investment in energy R&D during the energy crisis of the 1970s, when oil prices had skyrocketed. The Manhattan Project spent roughly $4.4 billion per year in 2008 dollars, while the Apollo Program spent $7 billion per year. By contrast, energy R&D investment after the initial shock of oil prices was slightly below $3.4 billion per year, and was relatively ineffective.

The more successful Manhattan and Apollo efforts represented 0.4 percent of U.S. gross domestic product during their peak years, while energy technology R&D has never gone above 0.1 percent.

However, the story goes beyond a relative lack of government funding for tackling energy challenges. The CRS report pointed out that the Manhattan and Apollo efforts were focused on developing technologies with specific goals in mind, such as achieving nuclear fission to create a bomb, or launching a rocket to the moon ahead of the Soviet space program.

By comparison, energy R&D efforts try to broaden energy resources, create commercially viable technologies, and protect the environment — three goals that may conflict at times.

The report echoes a presentation made last year by Robert Norris, a senior research associate with the Natural Resources Defense Council (NRDC).

"The Manhattan Project sought to solve what was essentially a large-scale engineering problem, where the solutions were based upon well-founded but largely untested theories," Norris said in his presentation to the National Academies of Sciences and Engineering. "Modern large-scale R&D efforts to address national problems such as climate change are much more complex."

President Obama's plan does propose incentives for private R&D on top of government efforts. An additional $20 billion is slated to provide tax incentives for clean-energy programs. And the President's long-term budget proposes almost $75 billion to make the Research and Experimentation Tax Credit permanent, which would provide more continuous support for U.S. businesses that invest above a certain amount in private R&D.

The President's overall proposal received praise from Dan Lashof, director of the NRDC climate center.

"At this critical moment in our nation’s history, we need a budget that drives our economic growth, protects our planet, and puts us on a path to a clean energy future," Lashof said.

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