Dr Arun Majumdar: America's green power broker

If there's a great woman behind every successful man, then there's a shrewd investor behind every cutting-edge technology. And if you're working within the American scientific community, that investor is likely to be Dr Arun Majumdar, head of the Advanced Research Projects Agency – Energy, otherwise known as Arpa-E.

Born in Calcutta and educated in Mumbai, the former Professor of Mechanical Engineering at The University of California, Berkeley, has been at the helm of Arpa-E since it was created by the US Congress in 2009 to "enhance the economic and energy security of the United States".

Yesterday, Nick Clegg outlined his plans for a British green investment bank, which could pump £15bn of government money into green technology projects and schemes over the next four years, in an attempt to make the UK a world leader in clean energy technology.

Britain's attempts echo Majumdar's work in the US. Arpa-E has invested close to £350m in a string of unproven clean energy technologies, such as Green Electricity Network Integration (Geni) and Solar Agile Delivery of Electrical Power Technology (Solar Adept), which exist on such a high-risk scientific fringe that private sector investors won't touch them.

It works in a similar way to Darpa, the defence equivalent of Arpa-E, which was launched in response to Sputnik and has been responsible for military technology breakthroughs such as autonomous planes and cars, and an early version of the internet called Arpanet.

Majumdar has spoken of creating a "Sputnik moment" for Barack Obama's administration through work funded by Arpa-E. Though he admits it will be a minimum of four years before any of these investments bear fruit, it's hoped that Arpa-E will ultimately harness the finest ideas of scientific America and radically alter how the planet's second biggest polluter generates, stores and utilises energy. By extension, the US could then begin to wean itself off fossil fuels and its geo-political commitments in the Middle East. The scientific stakes couldn't be any higher.

"When oil prices go up and gas prices go up, we hit the panic button, and when oil prices go down we hit the snooze button," Majumdar says of US society. "That really is not a long-term, sustainable way to run any nation."

But there's a problem: while Majumdar has funded 120 cutting-edge projects and drawn in £60m from impressed private investors, the US is lagging far behind the EU and China in turning good ideas into what Majumdar describes as "game-changers".

"It is a question of making sure the impact on the real world, the business side and the employment side actually happens," adds Majumdar. To Majumdar's mind, this can come only through developing US domestic demand for clean energy. But in a nation that consumes three gallons of oil per person, per day, this is obviously much easier said than done.

"It is not going to be overnight. It will take some time," admits Majumdar. "President Obama has said that we will reduce a third of our energy imports by 2025 and that is a target now. Just like President Kennedy said: 'We are going to go to the moon and come back safely within a decade.' Here now is President Obama's target."

To achieve this, Majumdar sites several options, such as the electrification of US transportation, the development of biomass fuels, the full utilisation of America's natural gas supplies and the relatively simple task of making US cars more fuel-efficient through the Corporate Automobile Fuel Efficiency (or CAFÉ) standards.

Yet he admits that effective, palpable change in US energy production will arrive only when corporate America and US society sees a financial advantage in utilising clean energy.

"There is a project on grid-level storage using compressed air, which is very innovative as, if you can get grid-level storage at low cost, then the idea of storing up or maximising the utilisation of renewable energy, becomes much easier," Majumdar reveals. "There is also a technology where the module cost of generating solar from silicon can be cut by 80 per cent. This is significant as, if you can make electricity from solar really cheap, it is a total game-changer. But it really is all about the cost and whether you can be market competitive. If you can bring down the cost, then the market will force it to scale without subsidy."

Majumdar believes it is Arpa-E's job to achieve this by supporting the basic science and engineering and, to some extent, the translation of this science into breakthrough technologies.

Yet he would also like to forge a stronger working partnership between the US and China, which holds the ironic distinction of being the world's largest polluter and the global leader in the introduction of electric vehicles, as a result of the £9bn Ten Cities, Thousand Vehicles Program launched in 2009.

China's president, Hu Jintao, has also called for an ambitious cut in emissions per unit of economic output by 40-45 per cent of 2005 levels by 2020. "China is doing what it really should be doing for its citizens," explains Majumdar.

"The question is: can we leverage that and can we learn from their experience in growing the economy the way that they are doing? They are, in fact, leapfrogging in cleaner technologies because they are doing things today and they are so new."

The US is by no means alone in grappling with the complexities of developing a clean energy system either. While the UK doesn't have the same coal-hungry power industry, which emits 41 per cent of American fossil fuel CO2, it does face the same technical problems of harnessing clean energy into the existing national grid – something Majumdar describes as "the biggest machine that humans have ever made".

But no matter how many British Green Bank billions are invested in wind farms, or houses refurbished for efficiency, in the Coalition's bid to become the "greenest government ever", nothing will substantially change until this technological hurdle is surmounted – and the same applies to the US.

"Just 30 to 40 per cent of electric wind capacity that's generated is actually used," explains Majumdar. "We cannot quite integrate the renewables, which are fluctuating, in a grid where the demand is also fluctuating, because they don't fluctuate at the same time.

"Like the UK, we also have the issue of how to create markets for it, so that people can make money out of it."

So what, then, does the future hold for us all? Well, despite a recent fall in US vehicle emissions through increased engine efficiency and a higher uptake of biofuels, Majumdar believes it will be a minimum of 10 years before anything truly revolutionary emerges from the US.

He also philosophically appreciates that he's likely to back far more bad investments than good ones, given the cutting-edge table he's gambling on.

But given the rate of climate change and the rapid economic and social development in Asia, he believes that the world simply has "got to take a chance" on new technology, because, realistically, there is no other option.

"If you look at where the world is going, the population is growing – it is about six-and-a-half billion, and is going to be around 10-11 billion people by the end of the century," says Majumdar.

"At the same time the income levels are going up in many places where the population is going up, such as China, India, Malaysia and Asia in general.

"When income levels go up, generally the energy usage goes up too, so you have a double whammy: the total energy use is going to increase in a non-linear way. That is what the world is going into and, on the one hand, you have to be able to support the economy and feed all of those people, but to do that you need the resources for energy, agriculture, materials and so on.

"We are in a finite world, so to some extent those resources are constrained. On the other hand, the waste we produce, particularly emissions, can't be infinitely produced either.

"So we are looking at a system where the population is growing, the energy use will grow, we are constrained on the supply side and constrained on the waste side. This, in the long run, is an unsustainable way of running the world. So we have to figure out a way to close the loop to make it sustainable. Hopefully, what we are doing here will help provide some options to do that."

Majumdar adds: "It is like the human genome project. When you go back in history, it was risky, but it had to be done because the benefits to society were potentially enormous."

So fresh, so clean

New energy programmes being funded by Arun Majumdar's ARPA-E

Beest

Batteries for electrical energy storage in transport – Beest – is an attempt to create low-cost batteries for electric cars. The hope is that ARPA-E will kickstart a fleet of electric vehicles that can cover the distances of petrol-powered cars.

Electrofuels

Another programme aimed at weaning America from the gasoline teat. Current Electrofuels projects include an Ohio State University project to create a liquid biofuel that works in existing fuel infrastructures using genetic modifications of bacteria.

Beetit

Beetit is the somewhat catchier acronym for "better efficiency through innovative thermodevices", a programme for creating energy-efficient air-conditioning for buildings. Current projects include a water-based system from United Technologies that could utilise a new method of supersonic compression.