Posted on March 12, 2025 by Hillary O’Brien
At the start of the 119th Congress, the U.S. energy sector stands at a pivotal crossroads. With historic investments in American energy projects already made and the potential for comprehensive permitting reform on the horizon, it is more important than ever for policymakers to provide clear, strategic direction and strong support for federal energy innovation programs. This is the moment to refocus these initiatives on achieving American energy dominance and securing a prosperous, clean energy future.
Over the last five years, U.S. energy policy has undergone a series of transformative updates through the passage of four major federal laws: the Energy Act of 2020, the Infrastructure Investment and Jobs Act, the Inflation Reduction Act, and the CHIPS and Science Act. Together, they modernized dozens of innovation programs at the U.S. Department of Energy (DOE) and provided the U.S. research community with a roadmap for the next decade of technology investments. These laws, enacted across both Republican and Democratic administrations, underscore an important truth: investing in American energy innovation is a deeply bipartisan issue.
A key driver of this consensus is a growing recognition that in order to maintain U.S. energy dominance, the U.S. needs to be more globally competitive over a wide range of advanced energy technologies. As our adversaries continue to invest heavily in energy R&D, policymakers recognize that whoever leads in the development of an emerging technology will not simply dominate its global market, they will also set the standard for how that technology is deployed and adopted – not just in the near term, but for decades to come. Whether you consider this opportunity from an economic, environmental, or humanitarian perspective – what’s clear is that America must lead the way.
It won’t be easy. China will outspend us on R&D – and depending on who you ask, they already have. According to the Congressional Research Service, the U.S. currently leads the world in R&D investments, but this position is eroding at an alarming rate. Over the last 60 years, the U.S. share of global R&D has fallen from approximately 70 to 30 percent. Meanwhile, in the last 20 years alone, China’s share has risen from roughly 5 to 25 percent.
Fortunately, the U.S. has a competitive advantage: thanks to our unique decentralized innovation ecosystem and a tradition of scientific discovery fostered across the national labs, universities, and private sector, America’s return on investment of our limited federal R&D dollars is extremely high. According to analysts at the Federal Reserve Bank of Dallas, over the past 70 years, non-defense federal R&D investments have shown estimated returns of 140 to 210 percent and account for approximately one-fifth of the U.S. business sector’s total factor productivity growth since WWII.
Nowhere is this more visible than in the U.S. energy sector, where DOE investments in both applied and basic research have led to landmark scientific discoveries that have strengthened American energy independence and driven down energy costs for consumers. In the 1970s, DOE’s early-stage research in horizontal drilling technologies led to the discovery of hydraulic fracturing, and, thanks to strategic partnerships with American industry – the shale gas revolution. In other words, as a direct result of investment in DOE innovation, the U.S. is now the world’s largest natural gas producer and LNG exporter. Why does that matter? Not only is natural gas responsible for nearly half of U.S. electricity generation, but it also, along with oil, contributes $1.8 trillion per year to the U.S. GDP – all while playing a major role in reducing U.S. methane emissions by as much as 18% overall.
Today, the stakes have never been higher. What our innovation ecosystem did for American LNG, it can and must do for American nuclear, American geothermal, and American manufacturing. To maintain U.S. competitiveness and reduce global energy emissions, American innovation is needed to drive the deployment of new clean energy technologies and systems. To succeed, these cannot just be clean – they must also be affordable, reliable, and secure.
It is at this critical moment that many of the foundational DOE programs authorized under the Trump Administration’s Energy Act of 2020 are set to expire. The time is now to examine ongoing federal investments in American energy, identify gaps in existing U.S. energy policy, and take lessons learned from the Biden administration’s implementation of recent laws.
Each of the eight policy recommendations below focuses on a DOE innovation program that is either expiring in 2025 or has yet to be authorized by law. Together, they provide a complete picture of the tremendous opportunity that is before Congress today to refocus DOE’s innovation mission on activities that are essential for U.S. energy dominance.
1. Reform federal processes to safeguard taxpayer dollars and maximize ROI. To unlock the full potential of the American innovation ecosystem, there is an urgent need for common-sense reforms to DOE grantmaking and oversight processes that will remove barriers for American researchers while adding guardrails to protect R&D investments from our adversaries. These include efforts to streamline funding opportunity announcements, remove permitting bottlenecks for demonstration projects, and secure American intellectual property while providing the National Laboratories with the ability to make decisions at a pace that matches industry partners’ needs. While many of these can be accomplished without additional Congressional authorities, core DOE modernization provisions in the Energy Act of 2020 could be revisited by Congress to ensure the durability of these reforms.
2. Invest in DOE next-generation geothermal initiatives to unleash abundant baseload energy. Advanced geothermal energy technologies have the potential to provide emissions-free, reliable baseload power anywhere in the country. What’s more, given similarities between conventional energy production and enhanced geothermal systems (EGS), these technologies are expected to preserve and leverage up to 200,000 existing American jobs. However, in recent years, DOE’s EGS demonstration projects have received 100 times less funding than other clean firm technologies like advanced nuclear, storage, or carbon capture. Congress could consider amplifying federal support for EGS demonstration projects and geothermal user facilities like Utah’s Frontier Observatory for Research in Geothermal Energy (FORGE), so that American companies can maintain their leadership edge.
3. Codify critical DOE materials science research to strengthen the next generation of American pipelines. America’s vast network of pipelines – over three million miles – are the backbone of the U.S. energy and industrial sectors. As this critical infrastructure continues to age and as new clean energy pathways come online, there is an urgent need to modernize American pipelines for the next generation. Federal research agencies require updated policy guidance and funding for research, development, and demonstration activities to ensure the longevity of our energy infrastructure, including in areas like materials science, metrology, and advanced computing. Congress could protect and preserve these activities by authorizing DOE’s long standing pipeline RD&D activities – which have never been codified in law.
4. Protect industry-led DOE carbon removal initiatives to future-proof American energy. Carbon dioxide removal (CDR) is an important component of America’s clean energy portfolio and refers to a suite of technologies that remove excess carbon dioxide from the atmosphere. CDR is needed to help us reduce global emissions while maintaining U.S. leadership in affordable, reliable, and exportable energy. Thanks to basic research in CDR innovation, widespread American deployments are on the horizon but are being held back by the absence of a clear market demand for these technologies. To capitalize on American leadership in CDR – which has the potential to create as many as 130,000 U.S. jobs per year, strategic investments in DOE’s cutting-edge CDR RD&D and demand-side efforts are urgently needed.
5. Establish an advanced mining R&D initiative to eliminate mineral reliance on China. The long-term security of America’s energy, industrial, and defense sectors hinges on access to a reliable and sustainable domestic supply of critical minerals. Current U.S. mining and mineral processing methods rely on outdated technologies that often undermine these efforts. According to the U.S. Geological Service, the U.S. is 100 percent net import reliant on countries like China for 12 of the 50 mineral commodities deemed critical by the Department of the Interior. DOE programs in critical minerals RD&D and advanced mining approaches can address this strategic vulnerability by accelerating U.S. innovation in breakthrough mineral mining technologies that are otherwise heavily underfunded. By authorizing DOE’s mine of the future activities, Congress could build fundamental long-term support for U.S. critical minerals supply chains and energy independence.
6. Expand DOE clean industrial technology programs to unlock global markets for American manufacturers. Leadership in advanced manufacturing technologies is essential to strengthening American industry’s global competitiveness in cement, concrete, asphalt, and chemicals. DOE’s clean industrial technology mission is to accelerate American innovation in manufacturing and grow the global demand for American-made products. To take advantage of the global construction boom and reduce reliance on foreign imports, DOE’s core programs in advanced industrial technologies could be expanded and extended to maximize the return on investment of committed demonstration dollars.
7. Formally establish a DOE grid security office to safeguard the energy sector from emerging threats. As global energy demand doubles in the coming decades and new, variable clean energy resources come online, our aging electric grid faces many new and evolving vulnerabilities — both physical and cyber. It is imperative that the federal government consider support for innovation in grid security technologies in parallel with the deployment of clean energy technologies. DOE is the lead agency for grid security in the energy sector and these activities are primarily carried out through its Office of Cybersecurity, Energy Security and Emergency Response (CESER), which was created under the Trump Administration in 2018. CESER is tasked with enhancing the security and resilience of U.S. critical energy infrastructure, mitigating the impacts of disruptive events and responding to and facilitating recovery from various energy disruptions. To protect and strengthen the essential function of this office, and to ensure its close coordination with the Department of Homeland Security’s Cybersecurity and Infrastructure Security Agency, Congress could consider formally authorizing CESER.
8. Recommit to innovative nuclear programs to unleash advanced nuclear deployments. Over the last five years, DOE’s Advanced Reactor Demonstration Program (ARDP), first authorized in the Energy Act of 2020, has given new life to the U.S. advanced nuclear industry. ARDP investments have a strong track record of follow-on investments from private industry – through this program, U.S. innovators have teamed up with utilities, project developers, and end-users to maximize ROI of limited R&D dollars. Continued strong investments in this program will be instrumental in launching a commercial nuclear fuel supply chain, reducing new technology risk, and improving Nuclear Regulatory Commission practices. As ARDP’s authorization expires, there is an opportunity for Congress to recommit to this program and its public-private partnerships.
DOE’s research, development, and demonstration activities, stewarded by our national laboratories and designed by industry, are the engine of the American innovation ecosystem. To maximize the return on investment of limited innovation dollars and position U.S. industry for success as new energy permitting regimes are considered, it is essential that Congress examine new ways to refocus these activities on American energy dominance.
