WASHINGTON, D.C.—At the inaugural summit of ARPA–E, or the Advanced Research Projects Agency–Energy, no less an august personage than Norman Augustine declared that we were possibly witnessing an inflection point—a turn from old thinking to new. As an aerospace business pioneer, Augustine certainly knows when trajectories change and escape velocities are attained. Indeed, a host of speakers regarded ARPA–E's effort as an Apollo project, a Manhattan project, and Mike Splinter, CEO of Applied Materials, even called for ARPA–E to be part of a potential Marshall Plan for energy—a road map to a future of clean power, complete with the Hoover Dam of solar, or the like.

But the actual premise of the U.S. Department of Energy's ARPA–E is somewhat simpler—emulate its older sibling, the Defense Advanced Research Projects Agency (DARPA), which has brought to the world a host of technologies, including stealth fighters and the Internet since its founding in 1958 during the Cold War in the wake of the Soviet Union's Sputnik. ARPA–E plans to fund multidisciplinary technical ideas that reduce greenhouse gas emissions, improve national security and create jobs.

Just 37 technologies qualified for government funds, with each getting an average $4 million. They were selected from 3,700 applications and from among the 75 percent that weren't disqualified for violating the first or second law of thermodynamics, according to Arun Majumdar, ARPA-E's first director. Yet, the bulk of them are old ideas dusted off after years of storage.

For instance, the Lexington, Mass.–based 1366 Technologies received funds to develop its "monocrystalline equivalent" wafers that are formed directly from melted silicon rather than sawed from a block, which wastes as much as half of the semiconducting material. Massachusetts Institute of Technology scientists David Bradwell and Donald Sadoway were funded to build a "pizza box"–size version of their liquid-metal battery—based loosely on the electricity-intensive process of making aluminum—that could enable the cheap storage of megawatts of electricity from intermittent resources such as the sun and wind. And United Technologies got money to develop a chemical analogue of the enzyme that takes CO2 out of biological tissue and dumps it in the lungs to be expelled, except that the chemical would extract CO2 from power plant flue gas. "We need to develop technologies to do fossil fuels cleanly," says Secretary of Energy Steven Chu, perhaps explaining why ARPA-E bankrolled five carbon-capture projects in this initial round.

"The number of good ideas has been amazing, and we don't even have all the intellectual horsepower of the U.S. into clean energy," Majumdar says. But "we need multiple lunar landings, not just one." Political realities, however, might short-circuit those "lunar landings," many of which won't become manifest for 10 years or more, according to Majumdar. "We are not short on ideas. The question is, what happens next?"

Funding efficiency
Nevertheless, another $100 million from the American Recovery and Reinvestment Act of 2009 (better known as the stimulus) was made available on March 2, to be awarded via ARPA–E to the best proposals for new grid-scale storage devices, better power converters and more efficient air conditioners, such as the ones being developed by the Palo Alto Research Center (PARC) that rely on sound waves rather than mechanical pistons to drive compressors.

The potential for impact is huge. For example, the cheaper, more powerful ultracapacitors under development by FastCAP Systems, another ARPA–E awardee, are intended to "finally make hybrid vehicles cost-effective," says Riccardo Signorelli, founder and president of the fledgling company. And if hybrids become cheap enough "just replacing 1 percent of [U.S.] vehicle fleet translates into $4 billion in [consumer] savings, $80 billion in oil we don't import and 50 million tons of CO2 reduction."

Enhancing economic might
ARPA–E is not just about the climate either; economic and national security implications also drive this small government program. "China missed the first industrial revolution, missed the computer revolution, and the biology revolution—they want to be a leader in the green revolution," Chu says, referring to the competition that might preclude U.S. domination of the field. "We want to be a leader. This is our prosperity."

Commercially, China certainly has a lead; it offers cheap, high-quality solar cells and components for wind turbines, among other key products. And it is already working on at least 21 nuclear power plants. "America is quickly falling behind in clean energy, trading Middle Eastern oil for cheap Chinese solar, batteries and wind turbines," says Chris Rivest, co-founder of Berkeley, Calif.–based SunPrint, which is developing technology to print cadmium telluride thin-film photovoltaic cells. "If not clean energy, what will be our next growth industry?"

That sentiment is not confined to plucky start-ups. "This is going to be the growth industry of the coming time period," said General Electric chief executive Jeff Immelt in his address to the conference. He noted that 292 gigawatts of electricity will be added in the world over the next decade, adding that "clean energy is the most exciting big market in the world."

Slow and steady wins?
Has ARPA–E been too conservative in these early stages, funding ideas that have been around for awhile? Besides the stimulus monies, the Obama administration committed just $400 million to ARPA-e specifically—and asked for just $300 million in next year's budget—for an agency intended to remake the multitrillion dollar U.S. energy landscape. China is spending $12 million an hour on clean energy, according to John Podesta, president of the Center for American Progress, a politically liberal think tank. And the U.S. lacks what many here regard as the key to driving a transition to clean, abundant energy: a price on carbon. "Let's not take this growth industry [in clean energy] and give it to every other country in the world but the U.S.," Immelt said.

But in the end, ARPA–E's conservative approach may prove to have been both politically and scientifically smart. In considering Galileo's breakthrough, "he didn't invent the telescope, he improved the telescope," said Chu in his address to the conference. "If you find a new rock or a new way of looking at the rock, chances are you can make a good discovery and you don't even have to be that smart."