Accelerating the Clean Energy Revolution

1

MISSION INNOVATION

A. Front End Material

2

Paris Climate Conference and

Agreement – Key Features *

Well Below 2°C Limit Warming to Well Below Target, and Try to

Cap at 1.5°C

Achieve a Balance Balance Anthropogenic GHG Sources and

Removal by Sinks by Mid-Century

Every 5 years Countries Will Review and Submit New, More

Ambitious Plans Every Five Years

TechnologyDevelopment

Advance Technology Innovation through Mission

Innovation and Breakthrough Energy Coalition

Mobilize ClimateFinance

Collectively Mobilize $100B per Year in Public

and Private Funding for Developing Economies

through 2025

EnhancedTransparency

Enhance Transparency for Reporting GHG

Emissions, Subject to Expert Review

3* Report on COP-21, “Inside the Paris Climate Deal”, Science, Warren Cornwall, Dec 2015: Vol. 350, Issue 6267, pp. 1451

4

A Unique Moment in Time

All on One Stage -- Leaders of 20 Countries Representing over 80% of Global Clean Energy R&D Investment Agreed to Support a Joint Statement on Innovation

Each Country Supported a Doubling of Governmental Clean Energy R&D Investment over Next Five Years (www.mission-innovation.net)

Gov’t Investment was Complemented by a Private Sector Initiative led by Bill Gates, the Breakthrough Energy Coalition (www.breakthroughenergycoalition.com)

5

Baseline

Distributed Globally

UnitedStates

Canada

Mexico

Brazil

Chile

Norway

SwedenDenmark

Germany

ItalyFrance

United Kingdom

Saudi Arabia

United Arab Emirates

India

ChinaJapan

Republic of Korea

Indonesia

Australia

Americas

$7 B

Asia and

Australia

$5 B

Europe

$3 B

European UnionNetherlands

Finland

6

Joint Statement

Rationale

Public Sector Actions

Private Sector Actions

Implementation & Cooperation

Information Sharingwww.mission-innovation.net

“Come together to reinvigorate and accelerate public and private global clean energy innovation

to make clean energy widely affordable”

B. Motivation and Rationale

7

Motivating Factors

On Climate Change, Time is Running Out:

Atmospheric Concentrations of GHGs are Rising, with Inexorable CC Effects

Changes in Climate are Manifest, Serious and Increasing

Business as Usual Approach is Unacceptable

Current Solutions are Ill-Suited or Too Costly for a World-Wide Acceptance

The Pace of Innovation is Too Slow

8

Widely Affordable Solutions Can Be Found:

Costs of Wind, Solar PV, Battery Costs, and LEDs Have Dropped Dramatically

More Innovative Ideas Are on the Cusp of Realization, but Need a Boost to Market

Private Investment is Poised to Help

Global Mobilization of Innovative Talent Will Speed Solutions and Mitigate CC Effects

Source: Adapted from DOE, “Revolution…Now: The Future Arrives for Five Clean Energy

Technologies – 2015 Update,” http://www.energy.gov/eere/downloads/revolution-now-

future-arrives-five-clean-energy-technologies-2015-update

0

20

40

60

80

100

120

2008 2009 2010 2011 2012 2013 2014

Land-Based Wind

Distributed PV

Utility-Scale PV

Modeled Battery Costs

LEDs

Indexed Cost Reductions Since 2008

9

Gaps in the Innovation Cycle

9

Clean Energy Solutions –

For Today and Tomorrow

Clean Energy Ministerial

Future Innovations

Science

Research

Development

Analysis

Tech

Demos

Deployment Now

Policies

Best Practices

Capacity Building

Prizes, Recognition

Mission Innovation

Create

New Ideas

Reduce

Cost

Raise

Awareness

Facilitate

Market Uptake

Improve

Performance

C. Public Sector Actions

11

Implementation

Mission: Reinvigorate and Accelerate Global Clean Energy Innovation to

Make Clean Energy Widely Affordable

Pledge: Seek to Double Public Investment in Clean Energy R&D Over Five Years

Report Progress: Share Plans, R&D Needs, Priorities and Ongoing Activities

Ongoing Activities:

12

Information Sharing Baseline and Annual Updates on Investments

Innovation Analysis and Road-Mapping

Build and Improve Technology Innovation Roadmaps and Other Tools For Optimizing and Leveraging Investments

Joint Research and Capacity Building

Public-Private and Country-to-Country Collaboration

Private Sector Engagement Collaborate on Data, Analysis, and Technology Expertise

*Governmental and/or State-Directed Clean Energy Research and Development Investment. For USG, Federal Investment; Does Not Include

State and Local Governments

13

Added R&D Investment is Significant

* MI Baseline of $15 billion USD in clean energy R&D is compiled from reports of 23 MI Member Governments.

Investment Focus of the

MI Doubling Commitment

Not Just More of the Same

Mission Innovation Funding Supports:

Clean Energy R&D

Early Stage Technology Innovation

Advancing a New Era of Discovery

Aimed at:

Superior Performance Technologies with Significant Cost Reduction

Leveraging MI Countries’ Capacities in Areas of Shared Interest

Breakthrough Energy Coalition will Focus Investment on Projects from MI Countries

14

Next Steps

Each Country Must Define Its Own Program Scope and Doubling Plan:

Establish a “Mission Innovation” R&D Baseline and Base-Year

Declare Amount of its Doubling Plan and by When

Provide a Country-Narrative Describing R&D Investment Priorities

Additionally, to the Extent Practicable:

Evidence Commitment by Announcing a First-Year Plan

Provide Transparency by Disclosing Composition of Baseline and Growth

Establish Information Sharing Mechanisms Among Countries

Identify R&D Needs, Conduct Analyses, and Launch Road-Mapping

Explore Joint Research & Capacity Building Opportunities

Agree on an International Platform for Sustained MI Operation

15

First Ministerial Meeting Hosted by the U.S. on June 2, 2016 in San Francisco, CA

D. Private Sector Actions

16

Private Sector Actions

“We must…add the skills and resources of leading investors with experience in driving innovation from the lab to the marketplace.”

“The private sector knows how to build companies, evaluate the potential for success and take the risks that lead to taking innovative ideas and bringing them to the world.”

“Governments play an indispensable role in supporting energy research.”

“Government research, however, is not enough. ”

-Bill Gates

17

Bill Gates, “Energy Innovation: Why We Need It and How to Get It,” http://www.breakthroughenergycoalition.com/assets/resources/Energy-

Innovation-by-Bill-Gates-Nov-30-2015.pdf; Breakthrough Energy Coalition, “Introducing the Breakthrough Energy Coalition,”

http://www.breakthroughenergycoalition.com/en/index.html

Changes in Climate are Manifest, Serious and Increasing

Poor Countries are Impacted the Most by Climate Change

Affordable Clean Energy Helps Fight Poverty

Energy Access Reduces Time Spent Carrying Water, Gathering Fuel, etc.

High Price of Energy Adds to Cost of Electricity, Transportation, and Other Necessities

Lighting Enables Learning and Productive Activity after Dark

To Stabilize GHG Concentrations, We Need to Move to Net-Zero Emissions

Efficiency is Important

So-Called “Bridge-Fuels” (Lower Carbon) Can Help in Transition

Ultimately, We Must Power All Sectors with CO2-Neutral Energy Sources

We Can Make Progress with Today’s Tools, But These are Not Enough

Challenges: Intermittency, Land Requirements, Reliability, Costs, etc.

Need to Create an Environment that Mobilizes and Accelerates Innovation

18

Gates on “Why We Need Breakthroughs in Energy Technology”

Drastically Increase Government Investment in Early-Stage R&D

Attract Private Capital into a Variety of Potential Solutions

Act Quickly Given Long Time Frames of Energy Transitions

19

Government and Business Together CanCreate the Incentives for Innovation

0%

5%

10%

15%

20%

25%

Total Private Sector R&D Spending

Percentage as a Share of Sales

Source: American Energy Innovation Council

Pe

rce

nt a

s a

Sh

are

of S

ale

s

20.5%

11.5%

7.9%

2.4%0.42%

Source: Bill Gates, “Energy Innovation: Why We Need It and How to

Get It,” https://www.gatesnotes.com/Energy/Energy-Innovation

20

Breakthrough Energy Coalition

Different Kind of Investor:

Long-term Commitment to New Technologies

Utilize Truly Patient, Flexible Risk-Tolerant Capital

Different Approach to Investment:

Identify Investable Ideas Early

Speed Up Innovation Cycle

Focus on Ideas that Go to Scale

Adopt Different Types of Deal Structures

Bill Gates, gatesnotes, “A Big Win for Cheap, Clean Energy,” https://www.gatesnotes.com/Energy/Investing-in-Energy-Innovation

Click to view video

21

Fund Principles

1. Invest EarlyProvide Seed, Angel and Series A Investments. Once De-Risked, Traditional Investors may Follow.

2. Invest Broadly

Invest Across a Number of Sectors: Electricity Generation and Storage Transportation Industrial Use Agriculture Energy System Efficiency

3. Invest BoldlyNovel Technologies and Dramatic Improvements to Existing Technologies. Credible Path to Rapid Scale-Up without Burdening Essential Systems.

4. Invest Wisely Tap Leading Experts to Guide Investment Decisions.

5. Invest TogetherInvest in Mission Innovation Countries’ Innovation Pipelines.

Breakthrough Energy Coalition

• 27 investors & University of California; collective net worth: $300+ billion• Commitment to invest in innovation emerging from Mission Innovation pipeline• Long-term, patient, and risk-tolerant capital

22

Mukesh

AmbaniJohn Arnold Mark Benioff Jeff Bezos Alwaleed bin

Ttalal

Richard

Branson

Ray Delio Aliko Dangote John Doerr

Bill Gates Reid

Hoffman

Chris Hohn Vinod

Khosla

Jack Ma Patrice

Motsepe

Xavier Niel Hasso

Plattner

Julian

Robertson

Mark Zuckerberg,

Priscilla Chan

Neil Shen Simons &

Baxter-Simons

Masayoshi

Son

George

Soros

Tom

Steyer

Ratan

Tata

Meg

Whitman

Zhang Xin

Pan Shiyi

Coalition’s Next Steps

Create an Innovation Pipeline

Build and Expand the Coalition

Make a Case for Greater Early-Stage Investment by Governments

Define Mechanisms for Coordination and Information-Sharing with Mission Innovation Countries

Establish a Series of Investment Funds with Scientific Due Diligence Capability

Goal: Launch Initial Round of Investments by the End of Calendar Year 2016

23

E. Implementation

24

MI Sub-Groups

Three Thematic, Ad Hoc Sub-Groups: *

1. Information Sharing

2. Analysis and Joint Research

3. Business and Investor Engagement

Sub-Groups “Staffed” by Int’l Volunteers from MI

Countries

Sub-Group Products to Flow into MI Framework

Document

25* Organized around themes of Joint Statement by MI Country Leaders

Backup Slides

26

Joint Statement:

“Each Country Will Seek to Double Governmental

and/or State-Directed Clean Energy R&D Investment

over Five Years”

Countries Subsequently Agreed to Share:

Clean Energy RD&D Budget Baseline;

Base-Year (or Alternative Methodology)

Doubling Plan and Doubling Year

Country-Specific Narrative on R&D Plans, Priorities

and Progress

Results as of November 14, 2016:

22 of 22 Countries Complied + EC

Total Baseline Figure is $15 Billion

Doubling Figure is $30 Billion by 2020-2021

27

Implementation

and Top-Line Results

Joint Statement on MI

November 30, 2016

MI Portfolio

Diverse and Robust

28

Power of Innovation

When Prices Drop, Markets Soar

29Source: Adapted from DOE, “Revolution…Now: The Future Arrives for Five Clean Energy Technologies – 2015 Update,”

http://www.energy.gov/eere/downloads/revolution-now-future-arrives-five-clean-energy-technologies-2015-update

0

20

40

60

80

100

120

2008 2009 2010 2011 2012 2013 2014

Cost Reductions Market Uptake

100

1000

10000

100000

2008 2009 2010 2011 2012 2013 2014

LEDs

Batteries

Utility-Scale

PV

Distributed

PV

Land-Based

Wind

Innovation and Deployment

-- A Natural Fit

Clean Energy Ministerial

Future Innovations

Science

Research

Development

Analysis

Tech

Demos

Deployment Now

Policies

Best Practices

Capacity Building

Prizes, Recognition

Mission Innovation

Create

New Ideas

Reduce

Cost

Raise

Awareness

Facilitate

Market Uptake

Improve

Performance

30

Clean Energy Solutions –

Examples

Clean Energy Ministerial

Smart Buildings, Internet of Things

Advanced Manufacturing

Novel CCS Technologies

New Materials

Revolutionary Aircraft

Electric

Vehicles

Smart

Grids

Renewable Energy Atlas

Super-Efficient Appliances

ISO 50001 Energy Management

Solutions Center (1,000 Requests)

10 Billion LED Bulbs

Mission Innovation

Create

New Ideas

Reduce

Cost

Raise

Awareness

Facilitate

Market Uptake

Improve

Performance

31

COP21 -- Historic Achievement:

187 Countries (98% of GHGs) Produced a Globally Inclusive “Paris Agreement”

Nearly All of World’s Countries Submitted INDCs

The Transformation to a Clean Energy Future is Beginning to Take Shape

Bad News

Sum of the INDCs Falls Short of What is Needed

Costs are Still Too High; and the Pace of Technology Innovation is Too Slow

Good News – Mission Innovation Can:

Create New Technologies, Improve Existing Technologies, and Reduce Costs

Attract Business and Investor Interest and Spur Global Action

Make Clean Energy Widely Affordable to a Global Population

Better News

MI + CEM Together Can Provide a Path to “Actualize” the Paris Agreement, and

With Realized Gains, Enable More Ambition at the Next 5-Year INDC Review

32

MI + CEM = Path

to Actualize the Paris Agreement

MI + CEM + Investors, Business and Industry = Accelerated Progress

33Source: Adapted from UNFCCC, Synthesis report of INDCs, October 2015; http://unfccc.int/resource/docs/2015/cop21/eng/07.pdf

GH

G E

mis

sio

ns (

GtC

O2

eq

/yr)

ConclusionsAccelerated Innovation

Drives Accelerated Progress (v1)

35

40

45

50

55

60

65

2000 2005 2010 2015 2020 2025 2030

Reduction

due to INDCs

Least-cost mitigation

scenarios to stay below

2°C

Potential additional

reduction due to

accelerated innovation

and deployment

80%

20%

MedianConditional and

Unconditional

INDC Ranges from COP21

Median of

COP21 INDCs

Pre-INDC

Historical

MI Funding

Solidify Doubling Plans

MI Research & Innovation

Share Information on Country R&D Portfolios and Priorities

Carry Out Joint Analysis & Technology Road-Mapping

Explore & Develop Collaborative Research Opportunities

Engage Business and Industry in R&D Plans and Projects

MI Demonstration & Deployment

Link with Clean Energy Ministerial

Raise Awareness of Most Promising New Techs

Facilitate Market Uptake

MI Implementation and Sustained Innovation

Periodically Take Stock of MI Progress

Make Strategic Adjustments, as Needed

34

Next Steps

Science

New Materials

High Temperature

Tailored Mechanical Chemical

Properties

Tailored Electrical Magnetic

Properties

Heat Transfer & Fluid Dynamics

Combustion Materials

Electro & Thermo Chemistry

Photo & Radiation Chemistry

Membranes & Separations

Condensed Matter Physics

Nanosciences

Geosciences & Hydrology

Chemical Catalysis

Bio-Catalysis

Plant and Microbial Genomics

(Biotechnology)

Bio-Based & Bio Inspired

Processing

Environmental Science

Earth and Climate Science

Atmospheric Science

Advanced Scientific Computing

Models and Simulations

Fusion and Plasma Sciences

Plasma Confinement Systems

High Energy Density Physics

5 New Energy Frontier

Research Centers (Total of 37)

35

MISSION INNOVATION

-- EXAMPLES Research

Regional Clean Energy

Innovation Partnerships

Small Business Innovation

Partnership Program

Energy Technology Innovation

Accelerators

ARPA-E

2 New National Network for

Manufacturing Innovation

Institutes for Clean Energy

Materials in Extreme Conditions

Initiative

Materials Manufacturing for Grid

Applications Initiative

New Desalination Hub

Sensors & Instrumentation

Basic Clean Energy Research

Zero-Emission Fossil Energy

Direct CO2 Capture from

Atmosphere

Safe Long-Term Ocean Storage

Development

Sustainable Transportation

SuperTrucks

Vehicle Lightweighting

Zero-Emission Vehicle Systems

Optimized Multi-Modal Intercity &

Freight Transport

Very Low Aviation Emissions

Renewable Power

Solar, SunShot Initiative

Wind

Water

Geothermal

Biomass

Fuel Cells

Energy Efficiency

High Impact Technology (HIT)

Catalysts

LEDs

Building Management and

Information Systems

Shading Attachments and Awnings

Refrigeration Controls

Commercial Fans and Blowers

Smart Buildings

Smart Meters

Energy Managed Communities

Advanced Sensors and Controls

Advanced Nuclear Energy

Pebble Bed

Molten Chloride Fast Reactor

Gen IV Energy Systems

Advanced Nuclear Fuels

Small Modular Reactors

Analysis

Demand Response and

Dynamic Pricing

Generation Flexibility

Microgrids

Distributed Generation

Physical and Synthetic Inertia

Electric Vehicles

Power Electronics

Resiliency

Cybersecurity

Polygeneration

Hybrid Generation

Combined Heat and Power

Waste Heat Recovery

CO2 as a Working Fluid

Carbon Management

NGCC Carbon Capture Pilot

Plant

3 Post Combustion CO2

Capture Pilot Plants (10 MW

Scale)

2 New FEED Studies for

Advanced Combustion

Energy Efficiency & Demand

Super-Efficient Equipment

and Appliance Deployment

Appliance Energy

Efficiency Policy Exchange

Forum

Efficiency Awards

Street Lighting Tool

Efficiency Standards and

Labeling

Global Lighting Challenge

(10 Billion High Efficiency

Bulbs)

Electric Vehicles

EV City Casebooks

Global EV Outlook

Energy Management

Working Group

ISO 50001 Energy

Management

Energy Management

Toolbox and Case Studies

Cool Roofs and Pavements

Toolkit

CHP/DHC Country

Scorecards

36

CLEAN ENERGY MINISTERIAL

-- EXAMPLES

Energy Supply

Solar and Wind

Global Atlas for

Renewable Energy

Renewable Energy

Learning Partnership

Capacity Development

Needs Diagnostics for

Renewable Energy

(CaDRE)

Renewable Energy

Auctions and Policies

Guides

Carbon Sequestration

Leadership Forum

Energy Systems & Integration

21st Century Power Partnership

Technical Assistance for Policy

and Regulatory Implementation

21CPP Fellowship Program

Distributed Generation

Regulation Resource Library

Renewable Energy Roadmap

for India

Global Lighting and Energy

Access Partnership

Global LEAP Awards

Off-grid Appliance Quality and

Efficiency Testing

Global Lighting Quality

Assurance Framework

Mini-Grids Quality Assurance

Framework

International Smart Grid Action

Network

Smart Grids Best Practice

Handbook

Smart Grids Training Academy

Smart Grids Integration Awards

Crosscutting

Clean Energy Education and

Empowerment

Awards for Mid-Career

Leadership in Clean Energy

Clean Energy Solutions Center

Ask-an-Expert Service

Online Training and

Resources

Finance Solutions Center