Powering the Next-Generation of Energy & AI: Federal R&D Investment
Hello, I’m Ylli Bajraktari, CEO of the Special Competitive Studies Project. In this week’s edition of 2-2-2, Nyah Stewart discusses the importance of federal funding for research and development (R&D) to drive breakthroughs at AI’s intersection with energy and beyond. For more on SCSP’s analysis of the Federal Government’s AI R&D spending levels, read SCSP’s newly released white paper, Fueling Innovation: Insights into Federal AI R&D Investment.
Exciting AI+ Summit Series Updates
SCSP is thrilled about our upcoming AI+ Summit Series, designed to drive rapid progress in artificial intelligence as it reshapes our nation and strengthens our national security.
First up is the AI+ Energy Summit on September 26th in Washington, D.C. We're excited to announce a stellar lineup of speakers, including Dr. David Kirtley, Dr. Eric Wachsman, Tim Latimer, and Dr. Brandon Sorbom. Stay tuned for more speaker announcements!
Next, mark your calendars for the AI+ Robotics Summit on October 23rd. Details on how to join will be coming soon.
The AI+ Summit Series will culminate with our highly anticipated AI+ Expo and the Ash Carter Exchange on June 2nd-4th, 2025. We can't wait to see you there!
We are excited to continue introducing new video content to our newsletters! Check out Ylli & Nyah’s overview of today’s newsletter, Powering the Next-Generation of Energy & AI: Federal R&D Investment.
Powering the Next-Generation of Energy & AI: Federal R&D Investment
The United States increasingly needs to develop novel energy solutions and drive breakthroughs in microelectronics and compute as artificial intelligence (AI) rapidly accelerates. AI itself has the potential to revolutionize scientific discovery in these very areas, from finding new materials for energy storage to controlling energy in tokamak nuclear fusion reactors. One critical factor to unlock the necessary transformations at this intersection of AI and energy is federal research and development (R&D) funding.
Three Ways Federal R&D Investments Boost Technological Leadership at the Nexus of AI and Energy:
Support Fundamental Research: Federal dollars have a long-term vision and can fund exploratory, basic research that lays the groundwork for technological innovations for years to come.
Augment Private Capital: Government spending can also address areas often overlooked by the private sector, investing in initiatives with higher capital costs and slower returns, but significant public and national security benefits.
Go Big: Most importantly, federal dollars can fuel the ambitious, whole-of-nation, technical goals like those that have landed America on the moon.
While there are important federal investments supporting AI R&D, our analysis shows that shortfalls persist in key government energy R&D programs.
The Department of Energy (DOE) leads many critical programs to our nation’s energy supply. DOE, with a network of national laboratories, vast amounts of scientific data, the operation of the world’s best supercomputers, and a wealth of expertise, has been at the forefront of both energy and AI advancements for decades. The Department and, consequently, the United States, require sufficient resources to successfully run these programs and remain a leader in AI and energy. The following are examples of our analysis of funding levels for key energy and AI programs:
1. The Next-Generation of Our Energy System
The Department of Energy’s Basic Energy Sciences and Fusion Energy Sciences programs, operating under the Office of Science, lead the research and development of our future energy system. These research portfolios will produce new forms of energy storage, transmission, and generation—like harnessing the sun’s power on Earth through fusion technologies. A review of current budgetary levels suggests both are under-appropriated by millions of dollars and their budgets do not meet the targets outlined in the CHIPS and Science Act.
2. Novel Forms of Microelectronics and Compute
Microelectronics and compute form the backbone of future technologies. DOE’s recently announced Microelectronics Science Research Centers (MSCRs) aim to contribute to the R&D of new materials, devices, and architectures for efficient semiconductors and AI systems. The CHIPS and Science Act authorized up to four centers to be funded at $25 million each per year, and the DOE’s current proposed funding for this initiative is at $120 million for three years—a difference of about $60 million per year. Similarly, DOE’s Advanced Scientific Computing Research (ASCR) Program, where “supercomputing, advanced networking and state-of-the-art research in computer science, mathematics and computational science” aims to push the field forward toward energy-efficient compute and new computing paradigms. Funding for ASCR this year was $1 billion, whereas the CHIPS and Science Act authorized roughly $1.2 billion for the program in 2024.
3. Future AI Algorithms, Applications, and Integration
The Department of Energy’s ambitious Frontiers in Artificial Intelligence for Science, Security, and Technology (FASST) program is a moonshot initiative at the intersection of AI and energy. This program will leverage the Department's resources and capabilities to build proprietary foundational AI models to accelerate scientific discovery and address energy challenges for national security. The DOE has proposed the FASST initiative, but no further resourcing has been committed by DOE or Congress to date.
Federal investment into R&D is critical for United States leadership in AI and energy. The convergence of artificial intelligence with energy represents just one facet of AI’s transformative potential across numerous sectors. While the Department of Energy’s efforts in AI and energy are crucial, they are just one piece of a larger puzzle.
Implications of R&D Spending Beyond Energy
AI is actively converging with all scientific fields across the physical, digital, and biotechnical domains. Various other departments and agencies work at the intersection of AI and their respective sectors, with over 200 federal AI R&D programs:
Public Health: The National Institutes of Health works at the convergence of AI and biology, with programs like Bridge to Artificial Intelligence (Bridge2AI) building flagship datasets and software for AI-enabled biomedical research.
Veterans Affairs: The Department of Veterans Affairs has a National AI Institute (NAII), which aims to leverage AI to improve Veteran care by moving promising AI and AI-enabled technologies into real-world clinical settings.
Agriculture: The U.S. Department of Agriculture supports the development and application of artificial intelligence through programs, like Data Science for Food and Agricultural Systems (DSFAS), which aims to enhance agricultural resilience, reduce food waste, and strengthen U.S. competitiveness.
These areas are examples where federal investment across fields and domains builds a more robust and multifaceted AI ecosystem. Funding for these various initiatives allows AI to drive transformations across sectors and for various fields to contribute to AI’s progress, forming a self-reinforcing cycle of innovation.
As a result, greater investment is needed at all intersections with AI and for the building blocks of artificial intelligence itself – talent, data, hardware, algorithms, applications, and integration. Effectively, increased investment in non-defense AI R&D is needed across the federal government, and this funding is needed now rather than later to fully reap the benefits of AI’s convergence with every scientific and technological field – including but not limited to energy.
For a closer look at key non-defense AI R&D programs across the federal government that require greater investment see SCSP’s recently released white paper, “Fueling Innovation: Insights into Federal AI R&D Investment.”