1. The federal government should not fund R&D that the private sector can and should support on its own. Federal support for R&D is most strongly justified when the R&D serves national interests that would not be satisfied by market action alone.

  2. ''Cost-sharing" with industry leverages federal R&D spending, introduces market relevance into federal R&D decision making, and accelerates the R&D process and transfer of results into the economy and the marketplace.

  3. The traditional division between "basic" and "applied" research is breaking down. The complexity of research problems requires interactivity between the two. The traditional paradigm is being replaced by "concurrent R&D."

  4. Although DOE's management of its energy R&D programs has improved in some respects over the years, it could be much more efficient and effective and could deliver more value to American taxpayers.

  5. Effective public investment in energy R&D requires continuity—including much longer funding commitments than the yearly congressional budget cycles. This will require new, innovative financing mechanisms.

Key Recommendations

  1. DOE should benchmark its own R&D management practices against "best practices" in the private sector and elsewhere in the government.

  2. DOE should adopt "best practices," insofar as practicable, and seek appropriate changes in legislation where best practices are legally restricted or precluded.

  3. DOE should develop an integrated strategic plan and process for energy R&D and use this process to determine funding priorities and manage a diverse energy R&D investment portfolio. The portfolio should include the following elements:

    • a balance of basic research and applied R&D (including industry cofunded demonstrations)

    • near-term and long-term R&D to provide continuing return on investment and to contribute to the health and vitality of domestic energy industries

    • a continuing commitment to supporting energy efficiency and renewable energy

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