Cuts Upfront Patent Licensing Costs and Challenges entrepreneurs to Commercialize Technologies from the National Laboratories

Boston, MA - As part of the Obama Administration's Startup America Initiative, U.S. Energy Secretary Steven Chu today announced the "America's Next Top Energy Innovator" challenge, which will give start-up companies the opportunity to license groundbreaking technologies developed by the National Laboratories for $1,000 and build successful businesses.  As part of this effort, the Department is reducing both the cost and paperwork requirements for start-up companies to obtain an option agreement to license some of the 15,000 patents and patent applications held by our 17 National Laboratories.

"America's entrepreneurs and innovators are the best in the world," said Secretary Chu.  "Today, we're challenging them to create new businesses based on discoveries made by our world-leading national laboratories.  Because we've cut the upfront fees and reduced the paperwork, we'll make it easier for start-up companies to succeed and create the new jobs our economy needs.  Our goal is simple: unleash America's innovation machine and win the global race for the clean energy jobs of the future." 

Currently, only about 10 percent of federal patents have been licensed to be commercialized.  This initiative aims to double the number of startup companies coming out of the National Laboratories.

Specifically, as part of "America's Next Top Energy Innovator:"

On Monday, May 2, 2011, the Department will kick off the challenge by posting a streamlined template option agreement online for entrepreneurs to submit to Laboratories.  Entrepreneurs must identify the technology of interest and submit a business plan to be considered for the program.   Participants will have until December 15 to make their submission to the Laboratory.

Any of the 15,000 unlicensed patents and patent applications held by the National Laboratories will be available for licensing by startup companies

From May 2 to December 15, the Department will reduce the total upfront cost of licensing DOE patents in a specific technology to a $1,000 upfront fee for portfolios of up to three patents.  This represents a savings of $10,000 to $50,000 on average in upfront fees.

Other license terms, such as equity and royalties, will be negotiated on a case by case basis and will typically be due once the company grows and achieves widescale commercial success.  These fees help support the Department's continuing research activities to develop new technologies.

The Department will simplify the licensing process and establish a standard set of terms for start-ups, who generally lack the resources, time or expertise to negotiate individual licensing agreements.  This will significantly reduce both the time and cost required to process the license, allowing faster access to the Department's patents and enabling the Department to process more licenses in a shorter amount of time. 

Entrepreneurs who complete the process and demonstrate progress toward executing their business plan and commercializing the technology will have the opportunity to be showcased at the 3rd Annual ARPA-E Energy Innovation Summit in 2012, which brings together leading technology startups and clean energy investors from around the country.

In addition to these steps, the Department is making it easier for companies to use the world-leading facilities at our National Laboratories to conduct collaborative research and development activities.  Previously, companies had to make an upfront payment covering the first 90 days of research work - a requirement that was often difficult for start-ups to meet.  Today, the Department is lowering the advance payment requirement to 60 days.  This change will benefit all companies - not just start-ups - but could be valuable for those participating in the "America's Next Top Energy Innovator" challenge.

Entrepreneurs interested in participating can already view the available technologies on the Department's Energy Innovation Portal.

Some of the promising innovations currently available for licensing and featured on the portal include:

• Solar Energy Storage, Transportation and Conversion - available from DOE's Lawrence Berkeley National Laboratory
  Researchers at Berkeley Lab have developed a system for converting solar energy to chemical energy and, subsequently, to thermal energy. The system includes a light-harvesting station, a storage station, and a thermal energy release station that enables transportation of stored energy over long distances.
  Marketing Summary
• Grid Friendly Appliance Controller - available from DOE's Pacific Northwest National Laboratory
  The Grid Friendly Appliance controller senses grid conditions by monitoring system frequency and provides automatic demand response in times of disruption. This simple computer chip can be installed in household appliances and can turn them off for a few minutes or even a few seconds to allow the grid to stabilize and prevent blackouts.  
  Marketing Summary
• Growth of Lattice Matched III-V Semiconductor Materials - available from DOE's National Renewable Energy Laboratory
  High-performance semiconductor materials have a broad range of potential applications, including high efficiency solar cells, solid-state lighting, and high-speed transistors. This portfolio allows for the use of low-cost, scalable, and reusable substrates to dramatically reduce production costs for these materials.
  Marketing Summary
• New Catalyst Can Reduce Nitrogen Oxide Emissions From Diesel Engines by 80-85% - available from DOE's Argonne National Laboratory
  The diesel DeNOx catalyst removes 80-85% of nitrogen oxide (NOx) emissions from diesel fuel combustion by converting NOx to nitrogen. With its lower expected manufacturing and installation costs, ease of use, and significant market potential, the Argonne catalyst is positioned to deliver the environmental-and economical-benefits needed to reduce our global industrial "footprint."
  Marketing Summary

Read some recent examples (pdf - 162 kb) of established companies and start-ups that have commercialized Department of Energy technologies.