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California to Trump: We’ll Fund Clean Energy If You Won’t

Amid federal cuts, some state scientists and senators think California should create an energy research effort similar to its breakaway stem-cell initiative.
June 13, 2017
California Governor Jerry Brown

In 2004, nearly 60 percent of California voters approved a ballot measure that dedicated $3 billion to embryonic-stem-cell research, in an act of democratic defiance aimed at President George W. Bush’s earlier ban on federal funding.

Some prominent Californians are arguing the state should stage a similar revolt today, as the Trump administration proposes deep cuts to yet another area of critical public research: energy technologies that could curtail the world’s reliance on fossil fuels.

Nathan Lewis, a chemistry professor at the California Institute of Technology, says the creation of California’s Stem Cell Agency allowed the state to attract world-leading scientists and produce the bulk of research in the field for the better part of a decade.

“That’s a wonderful example of the opportunity that is before us, if we seize it, step up and actually promote R&D,” says Lewis, who is also a principal investigator at the Joint Center for Artificial Photosynthesis, an effort led by Caltech in partnership with Lawrence Berkeley National Lab to produce clean solar fuels.

The Trump administration’s fiscal 2018 budget would cut some $3 billion from Department of Energy research programs, including nearly $1 billion from the Office of Science, which funds JCAP and other “innovation hubs.” Meanwhile, almost $1.5 billion in cuts to the Office of Energy Efficiency and Renewable Energy and the elimination of the moonshot ARPA-E program would ripple throughout solar, bioenergy, and vehicle technology programs at Lawrence Berkeley and the Lawrence Livermore National Lab in California.

Congress is likely to push back on many of the White House’s most drastic cutbacks, but the proposals have nevertheless prompted chatter in the state capitol about the possibility of a clean energy research initiative similar to the Stem Cell Agency.

So far, the only official proposal to do something like this is wrapped into the SB 775 cap-and-trade proposal introduced last month, which would funnel hundreds of millions of dollars annually into the California Climate and Clean Energy Research Fund (see “Amid Trump Cuts, California Proposes Its Own Energy Moonshot”).

Senator Kevin de León, a California Democrat and a coauthor of the bill, said the idea for the fund was partially driven by federal proposals to cut clean-energy R&D, including Trump’s cursory “skinny budget” released in March.

“We hope the Congress will reject the Trump cuts, but we aren’t standing around waiting for them to act,” de León says. “Our commitment to state environmental protections and investments in cutting-edge clean-tech research are leading reasons why California remains the capital of innovation.”

Indeed, California has established itself as a world leader on climate issues, creating its own cap-and-trade program in 2013 and passing a landmark law last year requiring the state to cut greenhouse-gas emissions 40 percent below 1990 levels by 2030. In the wake of President Trump’s withdrawal from the Paris climate accords this month, Governor Jerry Brown traveled to China and struck a bilateral deal to cooperate on emissions reduction efforts (see “Exiting Paris, Trump Cedes Global Leadership on Climate Change”).

On the private industry side, companies in the San Francisco, San Jose, and Los Angeles metro areas together received 46 percent of all U.S. clean-tech venture capital investments between 2011 and 2016, according to a recent Brookings report.

But big cuts to federal energy R&D could make it harder and more expensive for California to achieve its mandated emissions reductions. In addition, the level of funding cuts under consideration would amount to a massive economic blow for the state, eliminating hundreds if not thousands of jobs, as well as the secondary benefits of commercializing public research.

The odds of the new cap-and-trade proposal passing remain unclear, as Brown and other interest groups push for ways to preserve the state’s existing program. If that fund doesn’t come to pass, California senator Henry Stern says he’d like to see a ballot initiative like the one that established the Stem Cell Agency.

In fact, something similar was tried at least once before. Starting in late 2005, venture capitalist Vinod Khosla, who also provided money to the stem-cell initiative campaign, helped bankroll an ultimately unsuccessful ballot initiative that would have taxed oil companies and used the funds to reduce petroleum use and to “promote research in alternative energy technologies at universities.” If it had passed, it would have raised some $4 billion by this year.

Critics of the stem-cell initiative note that it hasn’t produced any FDA-approved treatments to date, but it has certainly advanced the science, and there are some promising clinical trials under way.

California is already investing hundreds of millions of dollars into clean-energy development through an array of programs, including the Energy Commission’s Electric Program Investment Charge and the Energy Innovations Small Grant Program. But most of the efforts are focused on commercializing fairly narrow and mature technologies, not the early-stage research that federal funds help promote.

“If we get serious and really invest, we can backfill the national lab funding, but also start to build our own ARPA-E,” Stern says.

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