Investing in Energy R&D

Despite my ongoing criticism of Bill Gates, he made one intelligent comment recently that is worthy of quoting.


“Over 90 percent of subsidies are on deploying technology and not on R&D. You can buy as much old technology as you want, but you won’t get breakthroughs which only come out of basic research,” Gates said. “If we don’t have innovation in energy, we don’t have much at all.”


The problem is quite true. Energy monopolies only invest 0.3% of their revenue back into R&D. And none of that ends up in clean energy R&D. It only serves as a tax write off, or at best, small enhancement of their own existing technology, but nothing really new.


The big corporations are not going to change. BP and now GE are going to be blowing massive capital in legal expenses to fight off suits from their massive screw ups in the Gulf of Mexico and now Fukushima Japan. Any smaller corporation who worked with them will likely be doing the same.


If the public wants change in this area they have to do the investment themselves. Stop waiting on politicians and greed motivated corporations to do anything to help humanity.


Corporations are not bad. But bad people who run them can do harm to everyone. Investors, employees, customers and innocent bystanders were greatly harmed by the greedy tactics of BP and GE. Jack Welsch, former CEO of GE boasted about firing 10% of GE employees every year to get rid of the dead wood and increase profits. We now see with 20/20 hindsight that policy was really firing whistle blowers before they gathered enough evidence to convict him of placing greed over civilized thought, which ended up placing an extremely dangerous, 6 nuclear reactor complex on top of the intersection point of 3 tectonic plates. We realize now that action to be totally insane, even to the general public. You don’t need a PhD in nuclear physics to see the insanity of that action, which is what happened under Welsch’s “profit first” leadership. Some nuclear plant designers are known to have resigned in protest of GE’s unsafe design, but the greedy bean counters won over sanity.


I know of NO, I repeat, NO public stocks dong genuine research and development of truly clean energy technologies. But investments in private corporations are restricted to:

  • Accredited investors.

  • Other corporations.

  • Trusts or funds suitably charted to handle high risk investment.


The general public is warned to stay away. There are loopholes like knowing the inventor or a prior business relationship, but even I will tell you advanced energy R&D is extremely high risk for many reasons. The 2 main ones are time and market risks. But safety is another big one.


  1. Can the technology be developed into a complete system before any competitor does the same? Even with a defined goal, time flies by when solutions are the big unknown. And a proper solution may require skills beyond the inventor’s abilities. Then finding help takes more time. Very few investors have sufficient patience to weather out the time consumption factor. This is WHY investors should never bet the farm on one invention. It will never be complete according to their needs. If you can’t afford to lose it, don’t invest it.

  2. Can it penetrate the market and be accepted by consumers? Here again, in a timely fashion. Even a successful YouTube video may spark interest, but do you have manufacturing and distribution channels in place? Or will you have people waiting years for delivery, as they have done with Tesla’s and Fiskers?

  3. Can the finished design be used by the average consumer without getting hurt. Did your R&D budget cover adequate safety testing?


Safety is a major concern even during the R&D phase. This was sadly proven last year when an inventor in Southern California, working with a form of hydroxy, was killed when a tank of it exploded. Does the R&D team have sufficient knowledge and funding to handle safety issues during the experimentation phase?


Another approach to helping start ups is debt capital. While banks love to use the term “investment” when they encumber a company with debt, that is NOT INVESTMENT. True investment waits until the project shows a profit before sharing rewards. Bankers demand their reward immediately, and payback on their time schedule well before anything is ready to sell. Not good. And usually disastrous as time most always runs out before anything is ready to go. Stop thinking like a banker.


A company named Profounder has a better answer to this problem. Even small investors may loan funds to a new start up idea. The payback is based upon future profits, not banker demands.


Convertible loans are another way to help a small start up R&D project. Write the terms just as Profounder does, to be based on future generated revenue rather than a clock or calendar.


So the only intelligent thing Bill Gates has said in years is to express the need to invest in clean energy R&D. I guess we have to practice what he preaches. He sure hasn’t.


Last but not least, if the inventor is working a second job to keep his garage research going, help him with that, whether buying things from his website or supporting his employer. Do unto others as you want them to do unto you.


Innovation comes at a cost. Politicians love to justify their taxes with the cliche phrase of “have you paid your fair share?” Unlike taxes which leave your control, what you buy or where you shop can truly accomplish good things. Have you invested your fare share with the right people for genuine improvements, or just continued to support the problem?


Ken Rasmussen



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