	Background

The Department of Energy’s multiprogram laboratories have had missions that are national in scope since their inception during World War II. These laboratories account for over half (59.3 percent) of the total national laboratory research budget that is spent on basic research. Table 3 shows that, across a 4-year period, most of the laboratories’ outputs were publications and reports. This finding was expected because reports and publications are the primary mechanisms for diffusion of R&D findings, and they are prepared at all stages of the R&D process. Laboratories’ Potential for Commercial Product Development

We looked at three indicators of the national laboratories’ potential for commercial product development: (1) formation of cooperative research and development agreements; (2) proportion of R&D expenditures in critical technology areas; and (3) research program managers’ judgments about their programs’ outputs. Almost three-fourths of the laboratories’ effort was devoted to research in critical technology areas, but achievement of commercial application will not be known for several years. Applied Research: meet a recognized need. 1989 to 1992? 5. 8. We found that the 10 laboratories produced many more publications and reports (21,593) than they did outputs related to commercial product development (2,510) in fiscal year 1992. 9. 6-7.) GAO Comments

1. The purpose of this study was to examine the extent to which the national laboratories are engaged in basic and applied research or research related to commercial product development. We defined development as having “some type of product as the output goal (emphasis added),” but concluding “with a prototype rather than a usable good.” Further, we point out that “Additional time, research, and testing are required to convert the prototype to a weapon or commercially viable product.” The definitions of outputs related to commercial product development, including those for precompetitive commercial products and processes, state that these outputs tend (emphasis added) to arise from development work, but that “they will require a substantial additional investment before they are ready to market.” The conclusion, moreover, reiterates that these outputs are “precursors to marketable goods,” and that, for this reason, “it is too early to determine whether this activity will produce technologies with commercial uses.”
We also examined the assumption that R&D is a linear process, with all commercial product-related outputs arising from development, and found that our data did not support it.
Why GAO Did This Study

Pursuant to a congressional request, GAO reviewed the extent that the Department of Energy's national laboratories are engaged in basic and applied research or in research related to commercial product development.

What GAO Found

GAO found that: (1) the laboratories devoted more than half of their research and development (R&D) funds to commercial product development during fiscal year (FY) 1992; (2) most of the laboratories' development work was devoted to defense research; (3) less than half of the laboratories' resources were spent on basic and applied research in FY 1992; (4) the laboratories produced 21,593 publications and reports and 2,510 products related to commercial product development in FY 1992; (5) publications and reports are the primary mechanism for disseminating the results of R&D activities; (6) although the potential exists for the laboratories to develop commercial product-related outputs, it is unknown whether the laboratories will achieve commercial applications for their outputs because they are still several years away from market entry; (7) cooperative R&D agreements between the laboratories and industry are increasing, with 17 agreements in FY 1989 and 196 agreements in FY 1992; (8) 74.1 percent of the laboratories' R&D expenditures in FY 1992 were for technologies identified as vital to national needs; (9) Congress has formed a panel to identify critical technologies essential for the nation's long-term security; and (10) over half of the commercial product development program managers expect clear evidence of the potential for commercial product development to emerge by FY 1997.