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Billion-Dollar Laboratory Demonstrates Economic Impact of Government Research

Tina Casey headshotWords by Tina Casey
Investment & Markets
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The National Renewable Energy Laboratory (NREL) made headlines last month when a third-party analysis concluded that its economic impact added up to $1.1 billion in fiscal year 2017.

That’s just the tip of the iceberg. Located in Golden, Colorado, NREL is the nation’s primary research facility for sustainable energy. Its impact is rippling throughout the U.S. as the American economy transitions into wind, solar and other renewable resources for power and fuel.

One laboratory, $1.1 billion in economic impact

The new NREL study was conducted by researchers in the Business Research Division of the University of Colorado Leeds School of Business.

Researchers at the school estimated that the bulk of the $1.1 billion in economic impact occurred within NREL’s home state, to the tune of $748 million.

As may be assumed, local employment in high-paying fields accounted for a large measure of the lab’s economic impact:

“A significant element of NREL’s impact is tied to jobs, with the greatest number of the laboratory’s employees located in Jefferson County, which saw a $413 million economic impact in FY 2017. The research team notes that more than 95 percent of NREL’s employees live in the Denver and Boulder metropolitan statistical areas, and that the Golden-based research laboratory is a top 10 employer in Jefferson County.”

Another big-dollar area consists of NREL’s partnership agreements with collaborators in business and academia, which number in the hundreds. The researchers note that NREL signed $80 million in new partnership agreements in fiscal year 2017 alone.

The intangibles of NREL’s economic impact

The researchers also factored in areas of economic impact that are less obvious.

For example, they estimated the value of NREL employee donations to local charities at almost a half a million dollars while logging in over 1,500 volunteer hours.

They also accounted for the ripple effect on the Denver metropolitan area.

Between NREL’s community events and its on-campus education center, fiscal year 2017 brought approximately 71,000 citizens into contact with the lab.

As the researchers note, the lab is especially active in the area of workforce development. The economic impact of that activity could resonate for generations:

“… according to the study, the laboratory hosted 122 science, technology, engineering and math outreach events in FY 2017, directly impacting 11,123 students and 330 teachers. NREL employed 175 student workers during the same fiscal year, further contributing to the science and technology workforce of the future.”

A ripple effect on the U.S. economy

NREL is managed and operated by the Alliance for Sustainable Energy, LLC, which is a collaboration between the leading research firms Battelle and MRIGlobal.

The lab’s roots are in a 1974 solar research facility, established as part of the U.S. response to the 1970’s oil supply crisis.

Renewable energy was once a bipartisan project. NREL achieved its current form in 1991 during the administration of Republican President George H.W. Bush. Its mission now ranges into bioenergy, wind power and many other aspects of clean technology.

In addition to core, esoteric research the lab is behind a series of technology improvements that have the potential to reach millions of users.

One measure of the lab’s broader economic impact is the number of awards it has garnered from R&D Magazine. The publication’s annual “R&D 100” awards are considered the “Oscars” of new, high impact technology.

R&D 100 awards for NREL over the past five years reflect the lab’s broad range of achievements.

Last year, the lab won for its new smart home energy management system, named “foresee.” Other recent awards include a new bio based material that replaces a petrochemical-based carbon fiber widely used for clothing and carpets, a microbe-based method for producing renewable ethylene (a building block for plastics), a low-cost method for “growing” silicon solar cells, and an energy efficient cooling system for data centers.

Another example of potentially widespread impact is a 2016 award for the energy efficient “EcoSnap” window-mounted heating and cooling unit.

NREL’s collaborative, partner-based approach plays a role in translating research into commercial application. For example, the lab cites its partnership with Toyota for ensuring that its award-winning traction drive can be adapted for use in electric vehicles.

Brace yourself for the rise of offshore wind

Speaking of partners, one outstanding example of NREL’s future economic impact is the newly established Offshore Wind R&D Consortium.

The new consortium launched last summer under the umbrellas of the departments of Energy and Interior. It is tasked with driving down costs and ramping up the nation’s offshore wind sector.

New York State leads the $41 million consortium through its Energy Research and Development Authority, with NREL among the technical consultants.

The consortium’s partners in the offshore wind development and transmission sectors are heavy hitters. They include Deepwater Wind, Shell, Ørsted, EnBW North America, Vineyard Wind and Anbaric Development Partners. The consortium also includes the Atlantic coast states of Maryland, Massachusetts and Virginia.

The U.S. offshore wind sector has been lagging far behind the overseas competition. That has changed. In the past two years, offshore wind lease activity on the Atlantic coast has generated millions in federal revenue.

Somewhat ironically, this new burst of activity in the U.S. offshore wind sector is taking place under the wing of the Trump administration, where wind power is regularly subjected to ridicule.

Nevertheless, with help from NREL the American offshore wind industry is finally poised to compete on the global stage and become a powerful new force in the U.S. economy.

Image credit: Pixabay

Tina Casey headshotTina Casey

Tina writes frequently for TriplePundit and other websites, with a focus on military, government and corporate sustainability, clean tech research and emerging energy technologies. She is a former Deputy Director of Public Affairs of the New York City Department of Environmental Protection, and author of books and articles on recycling and other conservation themes. She is currently Deputy Director of Public Information for the County of Union, New Jersey. Views expressed here are her own and do not necessarily reflect agency policy.

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