The Department of Energy’s (DOE) Advanced Research Projects Agency- Energy’s (ARPA-E) purpose is to overcome long-term and high-risk technological barriers in the development of energy technologies. Since 2009, ARPA-E has awarded $521.7 million to universities, public and private companies, and national laboratories to fund energy research projects.
GAO’s review suggests that most ARPA-E projects could not have been funded solely by private investors. Private venture capital firms told GAO that, among other considerations, they generally do not fund projects that rely on unproven technologies and tend to invest in projects that can be commercialized in less than 3 years.
Per its agency mission, ARPA-E usually determines that the technological risks of key parts of a project are too high for the private investor and therefore decides to fund the research.