[House Hearing, 109 Congress]
[From the U.S. Government Publishing Office]



DEPARTMENT OF ENERGY'S FISCAL YEAR 2006 BUDGET PROPOSAL AND THE ENERGY 
   POLICY ACT OF 2005: ENSURING JOBS FOR OUR FUTURE WITH SECURE AND 
                            RELIABLE ENERGY

=======================================================================

                                HEARING

                               before the

                    COMMITTEE ON ENERGY AND COMMERCE
                        HOUSE OF REPRESENTATIVES

                       ONE HUNDRED NINTH CONGRESS

                             FIRST SESSION

                               __________

                            FEBRUARY 9, 2005

                               __________

                            Serial No. 109-3

                               __________

      Printed for the use of the Committee on Energy and Commerce


 Available via the World Wide Web: http://www.access.gpo.gov/congress/
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                               __________
                    COMMITTEE ON ENERGY AND COMMERCE

                      JOE BARTON, Texas, Chairman

RALPH M. HALL, Texas                 JOHN D. DINGELL, Michigan
MICHAEL BILIRAKIS, Florida             Ranking Member
  Vice Chairman                      HENRY A. WAXMAN, California
FRED UPTON, Michigan                 EDWARD J. MARKEY, Massachusetts
CLIFF STEARNS, Florida               RICK BOUCHER, Virginia
PAUL E. GILLMOR, Ohio                EDOLPHUS TOWNS, New York
NATHAN DEAL, Georgia                 FRANK PALLONE, Jr., New Jersey
ED WHITFIELD, Kentucky               SHERROD BROWN, Ohio
CHARLIE NORWOOD, Georgia             BART GORDON, Tennessee
BARBARA CUBIN, Wyoming               BOBBY L. RUSH, Illinois
JOHN SHIMKUS, Illinois               ANNA G. ESHOO, California
HEATHER WILSON, New Mexico           BART STUPAK, Michigan
JOHN B. SHADEGG, Arizona             ELIOT L. ENGEL, New York
CHARLES W. ``CHIP'' PICKERING,       ALBERT R. WYNN, Maryland
Mississippi, Vice Chairman           GENE GREEN, Texas
VITO FOSSELLA, New York              TED STRICKLAND, Ohio
ROY BLUNT, Missouri                  DIANA DeGETTE, Colorado
STEVE BUYER, Indiana                 LOIS CAPPS, California
GEORGE RADANOVICH, California        MIKE DOYLE, Pennsylvania
CHARLES F. BASS, New Hampshire       TOM ALLEN, Maine
JOSEPH R. PITTS, Pennsylvania        JIM DAVIS, Florida
MARY BONO, California                JAN SCHAKOWSKY, Illinois
GREG WALDEN, Oregon                  HILDA L. SOLIS, California
LEE TERRY, Nebraska                  CHARLES A. GONZALEZ, Texas
MIKE FERGUSON, New Jersey            JAY INSLEE, Washington
MIKE ROGERS, Michigan                TAMMY BALDWIN, Wisconsin
C.L. ``BUTCH'' OTTER, Idaho          MIKE ROSS, Arkansas
SUE MYRICK, North Carolina
JOHN SULLIVAN, Oklahoma
TIM MURPHY, Pennsylvania
MICHAEL C. BURGESS, Texas
MARSHA BLACKBURN, Tennessee

                      Bud Albright, Staff Director

      James D. Barnette, Deputy Staff Director and General Counsel

      Reid P.F. Stuntz, Minority Staff Director and Chief Counsel

                                  (ii)






                            C O N T E N T S

                               __________
                                                                   Page

Testimony of:
    Bodman, Hon. Samuel W., Secretary, U.S. Department of Energy.    13
Additional mateial submitted for the record:
    Bodman, Hon. Samuel W., Secretary, U.S. Department of Energy, 
      response for the record....................................    61

                                 (iii)

  

 
DEPARTMENT OF ENERGY'S FISCAL YEAR 2006 BUDGET PROPOSAL AND THE ENERGY 
   POLICY ACT OF 2005: ENSURING JOBS FOR OUR FUTURE WITH SECURE AND 
                            RELIABLE ENERGY

                              ----------                              


                      WEDNESDAY, FEBRUARY 9, 2005

                          House of Representatives,
                          Committee on Energy and Commerce,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 2:09 p.m., in 
room 2123 of the Rayburn House Office Building, Hon. Joe Barton 
(chairman) presiding.
    Members present: Representatives Barton, Hall, Upton, 
Gillmor, Deal, Whitfield, Norwood, Cubin, Shimkus, Shadegg, 
Pickering, Buyer, Radanovich, Bass, Pitts, Bono, Walden, Terry, 
Otter, Myrick, Sullivan, Murphy, Burgess, Blackburn, Dingell, 
Markey, Rush, Engel, Wynn, Green, Strickland, Capps, Doyle, 
Allen, Solis, Inslee, Baldwin, and Ross.
    Staff present: Mark Menezes, chief counsel for energy and 
the environment; Margaret Caravelli, majority counsel; Kurt 
Bilas, majority counsel; Maryam Sabbaghian, majority counsel; 
Tom Hassenboehler, majority counsel; Jerry Couri, policy 
coordinator; Peter Kielty, legislative clerk; Sue Sheridan, 
minority senior counsel; Michael Goo, minority counsel; and 
Bruce Harris, minority professional staff.
    Chairman Barton. The committee will come to order. As soon 
as our audience finds their seats, the Secretary of Energy is 
here, and we want members to find their seats on the dais and 
our audience find its seat, and we will begin. Okay. If our 
audience could find their seats as expeditiously as possible so 
we can begin the hearing.
    The Committee of Energy and Commerce will come to order. 
The purpose of today's hearing is to welcome the Secretary of 
Energy to the House Energy and Commerce Committee and hear his 
views on the Department of Energy fiscal year 2006 budget and 
also on the proposed Energy Policy Act of 2005.
    We want to welcome Secretary Samuel Bodman to the 
Committee. By my calculation, Secretary Bodman is the tenth 
Secretary of Energy to serve as the Secretary of Energy. He 
comes from a distinguished career in the private sector. After 
that, he served as the Deputy Secretary of Commerce and most 
recently as the Deputy Secretary of Treasury. He was 
overwhelmingly confirmed to be the tenth Secretary of Energy by 
the full Senate not too long ago, and I believe today is his 
8th day on the job as Secretary of Energy.
    We look forward, Mr. Secretary, to a very productive 
relationship with you, and we welcome you.
    We are here to review the fiscal year 2006 budget request 
for the Department of Energy. The Department performs many 
tasks critical to the security, health, and safety of all 
Americans. The Department has greatly improved its performance 
over the last several years, and we would like to see that 
trend continue. The Secretary, as you know, provides the 
leadership for the Department of Energy and the vision to that 
Department, so that it can achieve its important goals. As 
chairman of the full committee, I look forward to working with 
you and to help on the budget and on the policy plans that you 
hope to implement at the Department of Energy.
    We also want you to speak to our pending energy bill as we 
get ready to begin to move on the Energy Policy Act of 2005. 
This legislation is essentially the conference report from the 
last Congress's H.R. 6, which passed the House with bipartisan 
support and was within two votes of at least being considered 
by the full Senate. But those two votes never materialized, and 
we only received 58, so the bill never had a vote before the 
full Senate.
    As the energy bill has been a long time coming, I 
personally think that it is time that we finally get the job 
done in this Congress. We have a world where there is a growing 
global energy demand, and also, unfortunately, we still have 
global energy instability. I think it is time that the United 
States of America take control of its own fundamentals for our 
energy future. Securing reliable energy means more jobs, more 
economic security, and national security for ourselves and our 
children, and I look forward to hearing your views on the 
energy bill.
    I also want to say that as we begin this hearing with the 
Secretary of Energy, we have had a very spirited debate in the 
committee about whether to markup the energy bill in committee 
or whether to take the bill straight to the floor. And last 
week, when we had that debate, I was under orders to move the 
bill as expeditiously as possible to try to have it on the 
floor in the next 2 weeks, have it on the floor before the 
President's Day recess.
    Since that time, it has been decided that there is going to 
be more time. And one of the reasons that we were given more 
time is that I asked for more time so that we possibly could 
have a full markup. We are going to have 2 days of hearings on 
the bill, beginning tomorrow. At that time, I am going to sit 
down with all members on both sides of the aisle, and if I see 
that a markup would be productive, I am very open to having a 
markup the following weeks, and it would be a full markup. It 
would not be a sham, run-through markup. So today's meeting 
with the Secretary of Energy and the next 2 days of hearings 
that Mr. Hall is going to chair, I would encourage all members 
to think strongly about what amendments they would like to see 
and whether it would be possible to work in a very cooperative 
and bipartisan basis to mark the complete energy bill up.
    With that, I am going to, again, welcome the Secretary. I 
am going to yield to Mr. Dingell for 5 minutes and then to any 
other member that wishes to make an opening statement of 1 
minute, and then we will hear from the Secretary of Energy.
    [The prepared statement of Hon. Joe Barton follows:]

 Prepared Statement of Hon. Joe Barton, Chairman, Committee on Energy 
                              and Commerce

    The hearing will come to order. There are several reasons for this 
hearing. First, I would like to welcome Secretary Bodman and 
congratulate him on his confirmation as the Secretary of Energy. We 
look forward to a productive relationship with you, Mr. Secretary. The 
Secretary was sworn in just last week so we appreciate the fact that he 
is here today to address us on two important matters.
    We are here to review the FY 2006 budget request of the Department 
of Energy. The Department performs many tasks critical to the security, 
health and safety of all Americans. The Department has greatly improved 
its performance over the last several years and we would like to see 
that trend continue. The Secretary provides the leadership and vision 
to the Department so that it can achieve its important goals. I look 
forward to the new Secretary's comments on the DOE budget and his plans 
for the Department.
    We also have asked the Secretary to provide us with his thoughts 
and comments on the Energy Policy Act of 2005. This legislation is 
essentially the conference report for HR 6 from the last Congress, 
which passed the House with bipartisan support and was within two votes 
of being passed by the Senate, with date changes and spending limits. 
An energy bill has been a long time coming. In a world of growing 
global energy demand and global instability, we must take control of 
the fundamentals of our future. Secure and reliable energy means more 
jobs, economic security, and national security for ourselves and our 
children. I am sure the Secretary shares these goals. As the new 
Secretary of Energy, Dr. Bodman can bring a new perspective to this 
debate, and I welcome his comments on the DOE budget, his plans for the 
Department and the energy bill.
    Since our last full Committee meeting, in which we discussed the 
process for our consideration of the energy bill, there have been a 
number of developments, and I am continuing my conversations with the 
House leadership and my fellow committee chairmen. After today's 
hearing, we will hold three more--one tomorrow and two next week. After 
the recess, we will have an opportunity to survey the situation and 
decide where we go. I want to make clear, though, that I have not ruled 
out a full Committee markup on a comprehensive bill.
    Mr. Secretary, again, welcome. I look forward to working with you, 
and listening to your testimony today.

    Chairman Barton. Mr. Dingell.
    Mr. Dingell. Mr. Chairman, first, thank you for this 
meeting. It is prompt, and I believe it is useful. I join in 
welcoming Secretary Bodman, and I congratulate you, Mr. 
Secretary, on your confirmation.
    In addition, these topics of this hearing will include Mr. 
Barton's discussion draft entitled ``Energy Policy Act of 
2005.'' The draft has not only been available, but available 
since last night, which seems to be a little more time than we 
usually have on these matters, for which I would express to you 
my appreciation, Mr. Chairman. I am pleased that the Secretary 
is here to answer questions about this matter, and I am hopeful 
that he has a better acquaintance with this legislation than do 
I.
    With respect to several important matters, Mr. Secretary, I 
want your particular and close attention to the Yucca Mountain 
program.
    First, let us address the question, which we will later on, 
DOE's $651 million request for 2006. Is it adequate to meet the 
program's near-term needs? Second, will the administration 
support legislative efforts to ensure long-term program funding 
by insulating the $16 billion balance of the Nuclear Waste Fund 
from competing budget pressures? What I mean here, Mr. 
Chairman, as you well know, is raids by our distinguished on 
the Budget Committee and the Appropriations Committee and our 
friends at OMB, who have sought to divert this money into 
totally different uses. And I would note that the situation is 
so bad that we are being sued, the Federal Government, to have 
the Federal Government make whole the electrical utility 
industry for something which was done clearly in violation of 
law.
    I have to observe that we are going to confront, in 
addition to this, some problems which have to be done and 
addressed. There will, of course, be questions with regard to 
fuel efficiency, and questions relative to the automobile 
industry. There will be questions about a wide array of other 
matters to be addressed. And there will, of course, be the 
question of reliability. Are we going to proceed toward getting 
a reliability bill, or are we going to risk getting ourselves 
bogged down, as we did last year? As you will recall, Mr. 
Chairman, in the last Congress, we wound up bogged down to our 
ears in trying to get a piece of legislation through, which 
would not move through the Senate, and we failed to move 
forward with the reliability bill, which could have addressed a 
matter of great concern to this Nation--the continuing 
unreliability of our electrical power system.
    Having said this, there are questions about limitations on 
the expenditures for electric reliability. One of my concerns 
is that a limitation on appropriations is that a limitation on 
the expenditures which will be made by the company or companies 
with regard to achieving reliability. This is a matter of 
significant concern to me and it is important that we should 
define what it is we are doing here with rather more clarity 
than I am comfortable we have today.
    Having said these things, I note that I am returning to the 
Chair 1 minute and 28 seconds in order to afford the chairman 
and my colleagues the full opportunity to read the splendid 
whole statement, which I have for the availability of the 
members and for the audience.
    Thank you, Mr. Chairman.
    Chairman Barton. We thank the gentleman from Michigan. And 
the Chair will point out, before he recognizes other members, 
that as the minority's eagle-eyed staff looks through the 
draft, they are going to find an amazing similarity to the H.R. 
6 conference report, which was released on November 18, 2003. 
In fact, as they get into it, they will find that the only 
changes are the change from 2003 to 2005 and the deletion of 
the Alaskan natural gas line section, which passed in the 
omnibus bill. Other than that, they are going to be able to 
report to you, Mr. Dingell, that it is the identical language 
that has been out there for almost 1\1/2\ years. So there will 
be some changes, date changes. Other than that, it is going to 
have an amazing similarity to what we have already worked on.
    The Chair would recognize the distinguished chairman of the 
Energy and Air Quality Subcommittee, Mr. Hall, for 1 minute.
    Mr. Hall. Mr. Chairman, I will waive my rights to--in order 
to get to this very important----
    Chairman Barton. The Chair will the recognize Mr. Markey 
for 1 minute as soon as he gets situated.
    Mr. Hall. Thirty seconds are gone.
    Chairman Barton. No. No, no. We won't start the clock until 
he has cleared his throat.
    Mr. Markey. Mr. Secretary, you come to us from the Cabot 
Corporation, a company founded by the Cabot family of Boston. 
It used to be said that Boston was the land of the bean and the 
cod where the Lowells talk only to the Cabots and the Cabots 
talk only to God. So we appreciate you coming before us here 
today, because we do need that level of inspiration.
    As I understand that--and I consider where the Republicans 
in Congress are heading with their energy bill, I can only 
conclude that they have been infected with Captain Ahab's 
syndrome. Take the arctic refuge, for example. You might recall 
that in Moby Dick, the Picard was supposedly searching for 
whale oil, but that turned out to be just a cover story for 
Captain Ahab, who was obsessed with going after the great white 
whale, even though there were plenty of other whales around 
that would have provided more oil at less cost.
    So, too, the oil companies have made it clear that they 
intend to drill elsewhere other than the arctic refuge where 
the oil is more certain and less costly to produce. Chevron 
Texaco, Conoco, BP have all pulled out, but this does not stop 
the Republicans on this committee. As one prominent Republican 
said, whether the oil companies are interested or not, what we 
are trying to do is produce the national energy policy, and 
that is the focus we put on it.
    Mr. Chairman, our guest from Boston has an incredible 
reputation as a hardheaded businessman. I hope you look at the 
facts and come to the right conclusions.
    Chairman Barton. Thank you. It should come as no surprise 
that the very first member to go beyond the limit that we all 
just unanimously agreed to is the distinguished gentleman from 
Massachusetts. I am sure as we go on through the year, he will 
become adept at getting his 1 minutes down to a science. His 
first effort was really about a 2\1/2\ minute effort, I could 
tell. Well, you had a whole page you didn't read.
    The gentleman from Georgia is recognized for 1 minute.
    Mr. Norwood. Thank you very much, Mr. Chairman. And Mr. 
Secretary, congratulations on your new posting. We are very 
appreciative of you being here today and look forward to 
working with you. I join with the Chairman in hopes that you 
will help us get this energy bill taken care of this year.
    But I only have a few seconds, and I would like to talk to 
you very briefly about my constituents at the Savannah River 
Site. They have done a great job down there in cleaning up the 
site. They have done it--done a great service to the Nation. 
The problem is, they have done a great disservice to their 
personal finances by cleaning the site up ahead of schedule. As 
anyone probably that served in the military knows, no good deed 
goes unpunished, and now hundreds of my constituents are being 
laid off. These are precisely, though, the kind of skilled 
workers we don't need to lose, in my view. We have new 
missions, potential new missions at SRS, such as the Mix Oxide 
Fuel Plant, the modern pit facility, and I look forward to 
working with you in trying to get these on board as quickly as 
we can so these highly skilled technicians don't scatter out 
all across the country and leave our sight.
    Thank you, Mr. Chairman.
    Chairman Barton. I thank the gentleman.
    Does the gentleman from New York, Mr. Engel, wish to make 
an opening statement?
    Mr. Engel. Yes, thank you, Mr. Chairman, and I will try to 
speak fast and do it in the minute.
    Mr. Secretary, thank you for testifying today, and we 
welcome you to Congress and congratulate you on your new 
position. When you were sworn in last month, you stated your 
commitment, and I am quoting you, to ``advancing our 
international nuclear proliferation efforts and ensuring 
reliable, secure, affordable, and environmentally responsible 
supplies of energy for our growing economy.'' I believe that 
the old, recycled energy bill from 2003 that we are voting on 
again fails to achieve your goals. I believe the bill is bad 
policy. I want to congratulate--commend the Chairman for giving 
us the markup. I was happy to hear what he had to say before.
    There is a laundry list of problems in this bill. There is 
nothing in the bill that reduces our consumption of oil. The 
bill does not create a market for renewables. It mandates a 
fixed market for ethanol, which will drive up the price of gas 
while providing liability relief to manufacturers of MTBE, ETB, 
and ethanol. I don't believe there is consumer justice there at 
all. Our energy policy is intricately tied to our national 
security and our economic well being, and we need to ensure 
that our energy policy is diversified, reduce our dependence on 
oil, and create skilled jobs while reducing energy costs.
    So Mr. Secretary, in conclusion, I urge you to encourage 
members of the administration and Congress to support sound, 
real bipartisan energy policies to meet the changing needs of 
our Nation, and I thank you.
    Chairman Barton. I thank the gentleman from New York.
    I didn't guarantee a markup. I appreciate the praise. I 
said I am thinking about it, so----
    Mr. Engel. I have faith in you, Mr. Chairman.
    Chairman Barton. Okay.
    Does the gentleman from California, Mr. Radanovich, wish to 
make an opening statement? Does the gentleman, Mr. Bass, wish 
to make an opening statement? Does Mr. Pitts wish to make an 
opening statement?
    Mr. Pitts. I will submit mine for the record.
    [The prepared statement of Hon. Joseph Pitts follows:]

    Prepared Statement of Hon. Joseph R. Pitts, a Representative in 
                Congress from the State of Pennsylvania

    Mr. Chairman, thank you for convening this important hearing this 
morning.
    Often, when we discuss issues regarding our national security, we 
focus on defeating terrorism, promoting democracy, and preventing the 
proliferation of weapons of mass destruction.
    As well we should.
    However, we cannot afford to overlook, more specifically, our 
energy policy during these discussions.
    Whether it's reducing our dependence on foreign sources of oil, 
protecting our nuclear energy facilities, or promoting renewable energy 
sources and technologies, we must pursue a comprehensive energy policy 
that secures America and advances economic growth and opportunity for 
future generations.
    If America is to remain a world leader, we must be strong, 
prosperous, and safe at home and I believe a comprehensive and creative 
energy policy is key to this goal.
    This debate is not new. We have been in need of an energy policy 
for many years. We had a comprehensive bill complete back in 2003. It 
passed the House, but fell victim to politics in the Senate.
    We can't afford to let this happen again. We have to get the job 
done now.
    I thank Secretary Bodman for testifying before this Committee 
today. I look forward to working with him on our energy policy.
    I am specifically interested in hearing his thoughts on what the 
Administration is doing to promote fuel cell technology to make it more 
affordable and available to average Americans.
    Fuel cell technology will significantly reduce our dependence on 
foreign sources of energy, limit our consumption of fossil fuels, and 
decrease pollution and greenhouse gases.
    We need to preserve our natural resources and protect our 
environment. Fuel cell technology can help in this effort.
    Again, thank you, Mr. Chairman, for convening this hearing. I yield 
back the balance of my time.

    Chairman Barton. Does Mr. Walden wish to make an opening 
statement?
    Mr. Walden. I will wait until questions.
    Chairman Barton. Okay. Does Mr. Otter?
    Mr. Otter. Mr. Chairman, first, I want to thank the 
Secretary for appearing before the committee today.
    Mr. Secretary, as you come to the Department of Energy at a 
time of great challenges, you know that the crises and energy 
supplies and prices must be addressed now. Delays are 
continuing America's dangerous dependence on foreign energy 
sources and putting our homeland security at risk and 
threatening our economic future.
    However, there is some good news. As you know, Idaho is the 
home of the Idaho National Laboratory, a premier Department of 
Energy facility and a keystone of America's energy future. 
Idaho's entire congressional delegation is proud to report that 
exciting things are happening at INL. Researchers there are 
making tremendous advances in the new nuclear reactor 
technologies, nuclear fuels, and working on cutting-edge 
hydrogen technology research and helping NASA power its space 
missions. They are involved with international efforts to 
secure nuclear materials and developing significant 
capabilities for America's defense and national security 
energy.
    When you visit INL, I am confident that you will be 
impressed with the capabilities there and the tremendous work 
being done, and I look forward to joining you on your tour of 
Idaho's, and the Nation's, premier National Laboratory.
    Thank you, Mr. Chairman.
    Chairman Barton. The gentleman's time has expired.
    Does the gentleman from Ohio wish to make an opening 
statement?
    Mr. Strickland. Yes, Mr. Chairman; I will talk rapidly.
    Mr. Secretary, briefly, I have serious concerns about the 
Department's decision as reflected in the President's budget to 
cease cold standby operations at the Portsmouth, Ohio Gaseous 
Diffusion Plant in fiscal year 2006. In addition, as you know, 
the Department of Energy recently issued its second draft rule 
on worker health and safety provisions passed in the 2003 
Defense Authorization Act. The first proposed rule issued in 
December of 2003 was wholly unacceptable as it put DOE 
contractors in charge of picking and choosing which safety 
standards would apply. The second rule seems better, but I 
still have reservations about the manner in which exemptions to 
the regulations will be considered.
    And finally, Mr. Secretary, I wrote to you last week about 
the issue of protecting the pensions and the benefits of 
workers at the Portsmouth, Ohio site as the transition is made 
to a new environmental cleanup contractor.
    Again, thank you for being here. I will have more detailed 
questions to submit, and I yield back my time.
    Chairman Barton. I thank the gentleman from Ohio.
    Does the gentleman from Oklahoma wish to make an opening 
statement?
    Does the gentlelady from California wish to make an opening 
statement?
    The gentleman from Pennsylvania?
    Mr. Doyle. Thank you, Mr. Chairman.
    Mr. Secretary, I want to offer my congratulations on your 
recent confirmation, and I look forward to hearing your 
comments on the Department's budget.
    As one of the few Democrats on the committee who supported 
last year's energy bill, I think it is critical that our Nation 
be guided by a comprehensive energy policy, which looks not 
just to the resources we have today, but to the power that new 
and innovative technology will help us harness in the future.
    With that in mind, your Department's cuts to research and 
development trouble me deeply. Technological innovations with 
distributed generation, such as the advancement in fuel cells, 
have the potential in the long run to produce more energy and 
more forms of energy than shorter-sighted approaches, such as 
drilling in the ANWR. Simply stated, I believe that these near-
term financial decisions jeopardize our Nation's goal of 
achieving energy independence. Cutting a few dollars in 
research today can result in energy costs in the future that 
will rise at a faster rate than our national debt has risen 
over the past 4 years.
    I urge you to reinstate and support these critical research 
and development programs. It is through advancing technology 
that America has charted our path of freedom, and it is only 
through continued advances that we will achieve energy 
independence.
    Thank you, Mr. Chairman. I yield back.
    [The prepared statement of Hon. Mike Doyle follows:]

  Prepared Statement of Hon. Mike Doyle, a Representative in Congress 
                     from the State of Pennsylvania

    Thank you Chairman Barton.
    Mr. Secretary, I would like to offer my congratulations on your 
recent confirmation and I look forward to hearing your comments on your 
Department's budget.
    As one of the few democrats on this committee who supported last 
year's energy bill, I think it is critical that our nation be guided by 
a comprehensive energy policy which looks not just to the resources we 
have today but to the power that new and innovative technology will 
help us harness in the future. With that in mind I must tell you that I 
am extremely concerned with the state of your department's budget 
proposal, specifically in regard to research and development.
    Technological innovations with distributed generation, such as the 
advancement in fuel cells, have the potential, in the long run, to 
produce more energy and more forms of energy than the shorter sighted 
approaches such as drilling in the Artic Wildlife Refuge.
    In the long range, your department's R & D advances have the 
potential to lead our nation towards the path of energy independence, 
yet the cuts of the past few years greatly undermine that potential.
    I believe the government must play a role in encouraging the 
development of technologies that can create a tremendous public benefit 
but which are too risky to take on alone. Yet, I am still seeing 
dramatic cuts in places that should be priorities such as distributed 
generation, clean coal research and other core R & D programs.
    In this budget we see total fossil fuel R & D cut by over $160 
million from the last calendar year, over 12 million in cuts of 
distributed generation systems, a total zeroing out of advanced hybrid 
combustion, ultra clean fuels and advanced fuels research, and fuel 
cell systems development.
    Simply stated, I believe that these are short sighted financial 
decisions that jeopardize our nation's goal of achieving energy 
independence. Cutting a few dollars in research today can result in 
energy costs in the future that will rise at a faster rate than our 
national debt has risen over the past 4 years.
    I urge you to reinstate and support these critical research and 
development programs. It is through advancing technology that America 
has charted our path of freedom and it is only through continued 
advances that we will achieve energy independence.

    Chairman Barton. We thank the gentleman from Pennsylvania.
    Does Mr. Murphy wish to make an opening statement?
    Mr. Murphy. I will submit something for the record.
    Chairman Barton. Okay.
    Does Mr. Burgess?
    Does Mr. Allen wish to make an opening statement?
    Does Ms. Solis?
    Ms. Solis. Yes, thank you, Mr. Chairman.
    I would also request unanimous consent to submit a letter 
that was sent to Mr. Gillmor, our chairman of the Subcommittee 
on Environment and Hazardous Materials, dated February 7.
    Chairman Barton. Without objection, so ordered.
    Ms. Solis. Thank you, Mr. Chairman.
    Just quickly, I would like to hear in the testimony, and 
welcome, Mr. Secretary, regarding why proposed cuts are being 
offered, 7 percent in programs that provide energy efficiency, 
20 percent in energy reliability, and 3.5 percent in 
weatherization programs. Many of these programs help to benefit 
Californians. We have been rated by the California--Association 
of Governments in California with a D-plus. We are not doing 
well in terms of energy conservation. And of course, we have a 
large population. It is very needy. I represent a very poor 
District, so I am very, very encouraged to hear what you have 
to say about these programs.
    Thank you.
    Chairman Barton. Does the gentlelady from Wisconsin wish to 
make an opening statement? The gentlelady is recognized.
    Ms. Baldwin. Thank you, Mr. Chairman.
    Welcome, Mr. Secretary.
    Over the course of his campaign, and as recently as the 
State of the Union Address, the President has said that we must 
be committed to making substantial investments in research and 
technology to make certain that good jobs and a strong economy 
are available for Americans well into the 21st century. 
Unfortunately, a close look at the President's budget, and 
specifically the science programs in the Department of Energy's 
budget, shows that the numbers don't match the administration's 
words nor fulfill its commitments.
    I represent a major research institution, the University of 
Wisconsin Madison, which has made numerous scientific 
breakthroughs and trained thousands of engineers and 
scientists, thanks, in part, to DOE funding.
    I look forward to hearing the administration's 
justifications for cuts to science programs in DOE's budget at 
a time when we are seeking to reduce our dependence on foreign 
oil, strengthen our economy, and produce the world's best 
scientists.
    Thank you.
    Chairman Barton. We thank the gentlelady.
    Does the gentleman from Arkansas wish to make an opening 
statement? The gentleman is recognized.
    Mr. Ross. Thank you, Mr. Chairman, Ranking Member Dingell. 
And Mr. Secretary, congratulations on your confirmation and 
thanks for joining us here today.
    I have got 49 seconds left, so let me just get to the 
point. With the increasing cost of natural gas, volatility in 
the energy markets, and rising gas prices, I believe it is 
imperative that we discuss methods to increase domestic 
production and to make it more affordable. One of the ways to 
do this is to increase the production and use of cleaner 
renewable agricultural-based energy. I believe that the 
incentives that have been provided at both the Federal and 
State levels to encourage this form of production should be 
expanded, while the production of ethanol, the primary biofuel 
produced by the agricultural sector, has risen from about 175 
million gallons in 1980 to 3.3 billion gallons in 2004. It is 
only accounting for .3 of 1 percent of the total U.S. energy 
consumption in 2003.
    I look forward to your comments and insight into how we can 
increase farm-based production as an alternative source for 
energy.
    Thank you very much. I yield back the balance of my time, 
and I ask unanimous consent to enter my entire statement into 
the record.
    Chairman Barton. Without objection, so ordered.
    [The prepared statement of Hon. Mike Ross follows:]

Prepared Statement of Hon. Mike Ross, a Representative in Congress from 
                         the State of Arkansas

    Thank you Chairman Barton and Ranking Member Dingell for having 
this important hearing today to discuss the Administration's Fiscal 
Year 2006 Budget Proposal for the Department of Energy. I appreciate 
Secretary Bodman taking time to be here with us to discuss the 
priorities of the Administration and to answer questions related to 
energy policy.
    With the increasing costs of natural gas, volatility in the energy 
markets, and rising gas prices, I believe it is imperative that we 
discuss methods to increase domestic production and to make it more 
affordable. One of the ways to do this is to increase the production 
and use of cleaner, renewable agriculture-based energy. I believe that 
the incentives that have been provided at both the federal and state 
levels to encourage this form of production should be expanded. While 
the production of ethanol, the primary biofuel produced by the 
agricultural sector, has risen from about 175 million gallons in 1980 
to 3.3 billion gallons in 2004, it only accounted for about 0.8% of 
U.S. petroleum consumption and 0.3% of total U.S. energy consumption in 
2003. I am looking forward to the Secretary's thoughts on how we can 
increase the use of farm-based production as an alternative source for 
energy.
    A concern that I have is in reference to the Administration's 
budget to reduce funding for Power Marketing Administrations (PMAs) and 
proposed rate increases. The budget request for FY06 is $57 million, a 
decrease of $152 million, or a reduction of 72.6%. The Southwestern 
Power Administration that serves over 200,000 constituents in my 
district would be adversely impacted by this proposal. It is my 
understanding that the cost of the electricity sold from federal dams 
would increase at 20% per year until the rates are at an undetermined 
market level. The power that is received from the Southwestern Power 
Administration is what is known as ``peaking power'', which means my 
constituents receive it when it is most needed, to heat or cool their 
homes when temperatures increase or decrease substantially. As a result 
of this proposal, the power rates in many areas in Arkansas that have 
not benefited from the economic recovery would increase. I am deeply 
concerned about this and would like to discuss it in more detail at the 
appropriate time.
    Again, thank you for convening this hearing and I look forward to 
the testimony from Secretary Bodman.

    Chairman Barton. Is there any member present who has not 
had an opportunity to give a brief opening statement?
    If not, the Chair would ask that all members who are not 
here that wish to put their statements in the record have 
unanimous consent to do so. Without objection, so ordered.
    [Additional statements submitted for the record follow:]

  Prepared Statement of Hon. Ralph Hall, a Representative in Congress 
                        from the State of Texas

    Thank you, Chairman Barton for having this hearing. I want to 
welcome you again Mr. Secretary and congratulate you on your recent 
appointment. I look forward to your testimony.
    As our President said in his State of the Union address to the 
Congress last week, ``four years of debate is enough.'' I favor a 
practical policy of putting first things first. Our nation and our way 
of life has been built on a foundation of affordable and reliable 
energy. From this foundation comes national and economic security, 
jobs, personal freedom, and comfort. I look forward to working with you 
to bring comprehensive energy legislation to the people of this 
country.
    I also commend you on presenting a budget representing what I 
understand to be an overall 2.0% decease from the Department's budget. 
However, I see many cuts in your Department's programs including: the 
Hydropower program, the Department's Fossil Energy Oil and Gas 
Technologies programs, and Electric Transmission and Distribution 
program. And I also noticed the reallocation of the Clean Coal 
Technology program funds and the reorganization of your Global 
Environmental Change Institute. The Department of Energy has outlined a 
very broad mission for itself to advance the national, economic and 
energy security of the United States and to promote scientific and 
technological innovation in support of that mission. I look forward to 
gaining a better understanding of how these changes fit within the 
Department's mission.
                                 ______
                                 
    Prepared Statement of Hon. Paul E. Gillmor, a Representative in 
                    Congress from the State of Ohio

    Thank you, Mr. Chairman, for yet another opportunity to iron-out a 
comprehensive energy bill to meet our country's critical and growing 
energy needs. I applaud your relentless commitment over the past two 
Congresses to this issue.
    Mr. Secretary, I congratulate you, welcome you here today, and wish 
you much success in your endeavors at the Department of Energy. While I 
am eager to hear your perspective concerning the President's DOE budget 
requests, the Energy Policy Act of 2005, and the direction of our 
nation's energy policy, I would like to briefly add my further support 
to the energy package before us.
    In particular, I am glad to see a strong renewable fuels standard, 
important to Ohio's farmers and the environment, as well as the 
measure's clean coal section, which is crucial to my state's natural 
resources, economy, and public health. I also believe this legislation 
will help stabilize natural gas markets, vital to manufacturers and 
farmers alike, who remain dependent on natural gas as the primary 
feedstock in the production of commercial fertilizers. Just last week, 
a corn-grower in my district informed me that the price of fertilizer 
has increased by 10 percent in each of the past several years. He 
expects a 20 percent spike in 2005.
    Furthermore, I am proud to see the incorporation of a bill that I 
re-introduced, H.R. 381, which permits states to provide tax credits 
for the production of electricity using clean coal and other renewable 
sources.
    I look forward to debate and remain optimistic that we will soon 
produce a meaningful energy bill for further consideration. Again, I 
thank the Chairman and yield back the remainder of my time.
                                 ______
                                 
Prepared Statement of Hon. Barbara Cubin, a Representative in Congress 
                       from the State of Wyoming

    Thank you, Mr. Chairman.
    I represent one of the few states in our great nation which is 
currently operating under the enviable flexibility of a budget surplus 
B a surplus achieved through years of fiscal discipline and the profits 
made through a healthy dose of responsible energy development. I am 
hopeful that during this hearing today, we will have an opportunity to 
promote both of these principles on a federal level.
    On a macro-level, the Department of Energy's budget request 
appropriately reflects our government's need to curtail wasteful 
spending and use those dollars we do spend more effectively. For that, 
Mr. Secretary, you should be credited.
    However, on a more programmatic level, your Department's budget 
request does contain certain policy changes and reduced funding levels 
for programs that have a great impact on the economies of the west and 
specifically, the livelihood of my constituency in Wyoming. I hope that 
through this hearing today, we are able to drill down on a few of those 
items and get more information on your reasoning behind these 
recommendations.
    Another way to ensure effective and appropriate spending is by 
establishing policy guidelines that produce the best results possible. 
This committee and the majority of us in the House have been trying to 
set such policy standards in the arena of energy development for over 
four years, but have been unable to send a final bill to the 
President's desk. In the times we are living in, a responsible national 
energy policy will have significant effects on the safety and 
prosperity of our nation and I look forward to hearing the Secretary's 
thoughts on how necessary this bill is to the work of his Department.
    I thank the Chairman for holding this important and timely hearing 
today and I yield back the balance of my time.
                                 ______
                                 
 Prepared Statement of Hon. C.L. ``Butch'' Otter, a Representative in 
                    Congress from the State of Idaho

    Thank you, Mr. Chairman.
    First, I want to thank Secretary Bodman for appearing before the 
Committee today.
    Secretary Bodman, you come to the Department of Energy at a time of 
great challenge. The crisis in energy supplies and prices must be 
addressed now. Delays are continuing America's dangerous dependence on 
foreign energy sources, putting our homeland security at risk and 
threatening our economic future.
    However, there is some good news. As you know, Idaho is home to the 
Idaho National Laboratory--a premier DOE facility and a keystone of 
America's energy future.
    Idaho's entire Congressional Delegation is proud to report that 
exciting things are happening at the INL. Researchers there are making 
tremendous advances in new nuclear reactor technologies and nuclear 
fuels, working on cutting-edge hydrogen research and helping NASA power 
its space missions. They're involved with international efforts to 
secure nuclear materials and developing significant capabilities for 
America's defense and national security agencies.
    In short, the INL is playing a critical role in ensuring America's 
energy independence.
    When you visit the INL, I'm confident you'll be impressed with the 
capabilities there, and the tremendous importance of the work.
    Meanwhile, I look forward to working with you to help meet the 
energy challenges facing your Department and this Congress.
    Thank you, Mr. Chairman.
                                 ______
                                 
  Prepared Statement of Hon. Gene Green, a Representative in Congress 
                        from the State of Texas

    Chairman Barton and Ranking Member Dingell, thank you for holding 
this hearing today, and thank you Secretary Bodman for joining us.
    The future energy security of our country is of extreme importance 
to me, my constituents, and every American.
    Because these issues are so important, I want to voice my support 
for a comprehensive set of hearings and a mark-up of energy legislation 
in this Committee.
    What is the purpose of being a member of the full Committee and 
particularly the Subcommittee on Energy and Air Quality if we do not 
get to consider legislation in our jurisdiction? Otherwise the Senate 
will get to write the bill, and priorities of the House will be left 
behind.
    My priorities may be different than many on my side of the aisle on 
this particular issue, but we all represent the same number of people, 
and deserve the same rights as legislators.
    For my part, I believe that one of the most important energy issues 
today is ensuring reasonable natural gas prices to protect American 
manufacturing jobs.
    Although it used to be heresy coming from a Texan, we also need 
more natural gas imports through LNG. The House energy bill does not 
contain any proposals addressing regulatory disputes over liquefied 
natural gas infrastructure.
    This just one example of many why we should consider this 
legislation in our Committee in 2005. We can promise to work fast, but 
don't leave us out.

    Chairman Barton. Mr. Secretary, welcome to the committee. 
We are going to put your entire statement in the record, and we 
are going to recognize you for such time as you may consume to 
elaborate on it. Welcome to the committee.

STATEMENT OF HON. SAMUEL W. BODMAN, SECRETARY, U.S. DEPARTMENT 
                           OF ENERGY

    Secretary Bodman. Chairman Barton, Ranking Member Dingell, 
and members of the committee, I am very honored to be here 
representing this President and this administration to talk to 
you about the 2006 budget proposal from the President to the 
Congress.
    As the members of this committee know very well, this 
Department, my Department, is charged with a very broad set of 
missions that are vital to our Nation's defense and our 
national and economic security. This Department is the steward 
of our Nation's nuclear weapons, with the responsibility of 
ensuring that our nuclear deterrent, which was so crucial in 
winning the cold war, continues to be viable and effective in 
today's changing world. This Department also leads America's 
international nuclear nonproliferation efforts.
    Closely related to our nuclear defense mission is the clean 
up of sites around the country that have been contaminated 
through the development of our nuclear capability. We have 
revamped this massive cleanup process, reducing the timetable 
by 35 years and the cost by an estimated $50 billion.
    The Department of Energy also is the primary Federal agency 
charged with maintaining our country's world leadership in 
science, particularly the physical sciences. Our National 
Laboratories include some of the most sophisticated science 
facilities in the world, and their work has led to some of the 
most important scientific advances of our age. We produced in 
these labs some 80 Nobel Prizes.
    And the Department also, of course, has the mission of 
ensuring a stable, reliable, secure, and affordable supply of 
energy for our Nation's growing economy while doing so in an 
environmentally responsible way.
    Our energy challenges today are greater than ever before. 
We face rapid growth in the demand for oil and natural gas at a 
time when domestic production is hard-pressed to keep up, and 
world energy markets are increasingly characterized by price 
volatility and political uncertainty.
    Our policy efforts must, therefore, focus on safeguarding 
our energy security by ensuring access to adequate supplies of 
affordable and clean energy. Promoting efficiency and 
conservation and the modernization and expanding of our energy 
infrastructure are additional focuses.
    Over the longer term, meeting these challenges will require 
fundamental changes in the way we produce and use energy and 
the development of advanced energy technologies that can 
transform our economy.
    Since President Bush unveiled his National Energy Policy in 
May of 2001, this administration has implemented or is taking 
action on all of the NEP recommendations that could be 
implemented without legislation by Congress. Congress has acted 
upon a number of other recommendations that are part of that 
report, including the Alaskan Natural Gas Pipeline and the 
Pipeline Safety Act, as well as certain tax measures and 
funding increases.
    Legislation considered by previous Congresses has contained 
numerous provisions to address many critical energy issues. 
Energy legislation, in my view, is among the most important 
matters to come before this Congress.
    I very much look forward to working with the Congress, and 
particularly with this committee, as an enthusiastic and active 
advocate for the passage of energy legislation this year.
    I would now like to take just a minute to give you some 
highlights of DOE's fiscal year 2006 budget request, which 
supports this policy agenda.
    The 2006 budget request totals $23.4 billion. It is an 
investment formulated to deliver results in four strategic 
areas: defense, energy, science, and the environment. Our 2006 
budget is $492 million below the fiscal year 2005 
appropriation. That represents a 2-percent reduction from 2005, 
and it, I believe, shows the Department's commitment to improve 
management, to streamlined operations, and to results-driven 
performance.
    We are requesting $2.6 billion in 2006 in the energy area. 
Research funded by the Department has produced some very 
significant advances. For example, the high-volume cost of 
automobile fuel cells has been reduced from $275 per kilowatt 
in 2002 to $200 per kilowatt in 2004 using innovative processes 
developed by the National Laboratories and fuel cell 
developers. Achieving a cost of $50 per kilowatt is a 
technological advance required to help make fuel cell vehicles 
cost competitive with today's vehicle. So we still have a long 
way to go.
    In addition, the budget continues to support the 
Weatherization Assistance Program to reduce utility bills for 
low-income families while conserving energy.
    The budget request of $3.5 billion in fiscal year 2006 for 
the Office of Science supports the continued operation of 
world-class, state-of-the-art scientific facilities and the 
design and construction of new science facilities.
    Our request for the defense program is $9.4 billion to 
support the nuclear deterrent and to fund nonproliferation 
programs, such as Megaports, which is aimed at stopping the 
illicit shipment of nuclear and other radioactive material.
    The fiscal year 2006 budget requests $7.3 billion for the 
activities of the Offices of Environmental Management, the 
Waste Management Office, and the Office of Legacy Management. 
This amount is considerably less than last year's allocation, 
because the Department is on track to meet the goals in a 
number of areas, including the cleanup of contaminated DOE 
sites and the commitment to complete the license application 
process and construction of a nuclear waste depository at Yucca 
Mountain.
    I very much look forward to working with the members of 
this committee on the many issues that I have discussed, and I 
would be happy, Mr. Chairman, to answer any questions.
    Thank you very much.
    [The prepared statement of Hon. Samuel Bodman follows:]

   Prepared Statement of Samuel W. Bodman, U.S. Department of Energy

    Chairman Barton, Congressman Dingell and members of the Committee, 
I am honored to be here today to discuss the President's fiscal year 
2006 budget proposal for the Department of Energy. As the members of 
the Committee know, the Department is charged with a broad mission that 
is vital to our national and economic security.
    The Department of Energy is the steward of our nation's nuclear 
weapons stockpile, with the responsibility of ensuring that our nuclear 
deterrent--which was so crucial in winning the Cold War--continues to 
be viable and effective in today's changing world. This Department also 
leads America's international nuclear nonproliferation efforts. Few 
things are more critical in the post-9/11 era than keeping weapons-
usable nuclear material from falling into the wrong hands.
    In addition, the Department of Energy is the primary federal agency 
charged with the stewardship of our country's physical sciences 
research enterprise. Our Department's network of National Laboratories 
includes some of the most sophisticated science facilities in the 
world, which each year host thousands of researchers whose work has led 
to some of the most important scientific advances, breakthroughs and 
discoveries of our age.
    And of course the Department of Energy has the mission of 
supporting a reliable, secure, and affordable supply of energy for our 
nation's growing economy, while doing so in an environmentally 
responsible way.
    Our energy challenges today are greater than ever before. We face 
rapid global and national growth in the demand for oil, natural gas, 
electricity and other forms of energy, at a time when our domestic 
production is hard-pressed to keep up and world energy markets are 
increasingly characterized by price volatility and political 
uncertainty in key energy-producing regions.
    Our policy efforts must therefore focus on safeguarding our energy 
security by ensuring access to adequate supplies of affordable and 
clean energy; promoting efficiency and conservation; and modernizing 
and expanding our energy infrastructure.
    Over the longer term, meeting these challenges will require 
fundamental changes in the way we produce and use energy, and the 
development of advanced energy technologies that could transform our 
economy. Today's energy situation has been long in the making, and the 
solutions will require a determined, sustained and balanced approach.
    This Administration has undertaken a bold energy policy agenda, 
which I intend to diligently support and advance during my tenure as 
Secretary. We will build upon the tremendous progress made in the last 
four years in implementing the President's National Energy Policy, yet 
we still need the Congress to enact important aspects of it. We will 
continue to improve our energy security through diversification of 
energy sources and suppliers; through efficiency gains; and through 
research, development, and deployment of alternative energy sources and 
technologies to make better use of our traditional energy resources.
    Energy efficiency and conservation will remain an important part of 
our strategy. The United States, through DOE, invests far more than any 
other nation in energy efficiency research and development--an 
investment we intend to continue. By balancing our efforts in 
efficiency and conservation with our focus on developing alternative 
energy sources, we can maximize our progress in addressing the growth 
of energy demand.
    We will pursue diversity and balance in terms of our supply 
sources. High oil prices remain a real concern for global economic 
growth. We will continue to foster relationships with a diverse set of 
energy suppliers and maintain and enhance our relationships with oil 
and gas producing nations around the world.
    We will work diligently for the passage of legislation to open a 
very small area of the coastal plain in the Arctic National Wildlife 
Refuge (ANWR) to environmentally responsible oil and gas exploration. 
In its peak year of production, ANWR could provide up to 1 million 
barrels per day of new domestic supply--increasing domestic production 
by nearly 20% and offsetting nearly 6 percent of our daily crude 
imports--in the context of an increasingly volatile and less secure 
global oil market.
    In addition to oil prices, natural gas prices also have risen 
sharply. In years past, the market response to escalating natural gas 
prices has been to increase domestic production. But accelerated 
depletion of existing natural gas fields and constraints on access to 
new supplies are making that traditional response more difficult. Over 
the next 20 years, EIA projects that we will increasingly supplement 
North American gas production with imports of liquefied natural gas 
(LNG)--which requires the constructionof new LNG infrastructure, with a 
paramount focus on safety.
    Our policy also seeks to improve the way we produce and use our 
conventional fossil energy resources. Coal remains the dominant source 
of energy in this country, producing more than half of our electricity. 
We will continue to place high priority on the development of clean 
coal technologies and their application in the marketplace--to allow us 
to continue using our 250-year supply of coal with fewer environmental 
impacts.
    In addition, our National Energy Policy looks to such sources as 
nuclear power, hydropower and other renewable sources such as wind, 
solar, geothermal and biomass to give us a broad mix of energy 
resources to meet our future needs. And we are keenly focused on 
developing transformational new sources of energy such as hydrogen and 
nuclear fusion. As we confront the energy challenges before us, we will 
simply be unable to find and employ the energy we need in an 
environmentally acceptable manner without aggressive investments that 
lead to breakthroughs in science and technology.
    We also face challenges in delivering energy to consumers. We have 
a complex nationwide grid system for the transmission of electricity 
that has multiple owners and that was designed and built for a power 
market much different from today's. This has led to reliability 
concerns, exacerbated by inadequate and outdated equipment and 
processes--problems that, in many cases, will require extremely large 
private-sector investments to correct.
    In addition, the cost and availability of certain fuels--along with 
differing local and regional regulatory structures--make electricity 
much more expensive in some parts of the country, and much less 
expensive in others. We need an approach to our electricity policy that 
takes this diversity into account yet stimulates the needed investment 
in the electric power grid.
    Central to many of our energy strategies are public-private 
partnerships, which as a veteran of the private sector, I 
wholeheartedly support. Because most of our energy production and 
delivery is carried out by private enterprise, I believe public-private 
partnerships are essential to DOE's role in helping ensure reliable 
supplies of fuels and electricity, upgrading energy infrastructure, and 
driving research and development of new energy technologies.
    Fostering technology research and development to ensure America's 
energy security is just one of the many aspects of the Department of 
Energy's wide-ranging activities. Under President Bush, we have 
invested more in science, technology, and basic research than at any 
time in history. DOE's national laboratories lead the world in research 
in fields including high energy physics, nuclear physics, plasma 
science, and the material and chemical sciences.
    In the critically important area of national defense, the Energy 
Department's National Nuclear Security Administration has made 
significant progress in upgrading the capabilities of the nuclear 
weapons complex and the facilities that support it. I look forward to 
continuing that progress.
    I also believe that we must build upon the Department's impressive 
achievements in the area of nuclear non-proliferation. Nuclear material 
around the world must be made more physically secure to make certain 
that it is never acquired for use in weapons, either in nuclear devices 
or in radiological dispersion devices, or so-called dirty bombs.
    Closely related to the Department's nuclear defense mission is the 
cleanup of various sites around the country that have been contaminated 
through the years as a result of the development of our nuclear defense 
capability. Over the past four years, the Department has reva mped the 
massive cleanup process for these sites, reducing the timetable by 35 
years, moving the projected completion date to 2035 from 2070, and 
reducing the estimated cost by about $50 billion in the process.
    Since President Bush unveiled the National Energy Policy (NEP) in 
May 2001, this Administration has implemented or is in the process of 
taking action on nearly all of the NEP recommendations that could be 
implemented without legislation by Congress. And you have acted upon a 
number of the NEP recommendations, including the Alaska Natural Gas 
Pipeline, the Pipeline Safety Act, certain tax measures, and 
recommended funding increases.
    However, energy legislation still awaits final congressional 
action. Legislation considered by previous Congresses has contained 
numerous provisions to expand our domestic energy production, modernize 
our energy infrastructure and electricity laws, expand our use of 
renewable energy sources, promote energy efficiency, and develop new 
energy sources to help reduce pollution and lessen America's dependence 
on foreign oil.
    Energy legislation, in my view, is among the most important matters 
to come before this Congress. I look forward to working with each of 
you, and with others in Congress, as an enthusiastic advocate for the 
passage of energy legislation this year.
    I would now like to take a few moments to give you some highlights 
of DOE's FY06 budget request which supports the policy agenda I have 
just outlined. The fiscal year 2006 budget request, totaling $23.4 
billion, is an investment formulated to deliver results in four 
strategic areas: Defense, Energy, Science, and the Environment. The 
Department's 2006 budget is $492 million below the FY 2005 
appropriation. Overall, the 2006 budget represents a two percent 
reduction from 2005. This shows DOE's commitment to improved 
management, streamlined operations and results-driven performance.

Energy
    We are requesting $2.6 billion in FY 2006 to meet the Department's 
Energy goals. Research funded by the Department has produced some 
significant advances. For example, the high-volume cost of automotive 
fuel cells has been reduced from $275/kW in 2002 to $200/kW in 2004 
using innovative processes developed by the national laboratories and 
fuel cell developers. Achie ving a cost of $50/kW is one technological 
advance required to help make fuel cell vehicles cost competitive with 
today's internal engine vehicles. To support our energy goals, the FY 
2006 Budget continues major initiatives such as the President's 
Hydrogen Fuel Initiative, as well as the research and development 
associated with the Advanced Fuel Cycle Initiative and carbon 
sequestration.
    In addition, the budget continues to support the Weatherization 
Assistance Program, which reduces utility bills for low-income families 
while conserving energy.

Science
    The budget request of $3.5 billion in FY 2006 for the Office of 
Science supports the continued operation of world-class, state-of-the-
art scientific facilities and the design and construction of new 
science facilities. By providing support for key scientific 
disciplines, critical tools, and the scientific workforce of today and 
tomorrow, we help to provide a long-term basic research foundation for 
our high-tech economy. The Science program at DOE will continue to 
identify emerging opportunities and push the limits of today's 
technology to meet our goals.

Defense
    The FY 2006 budget request for DOE's defense programs is $9.4 
billion. The return to the American taxpayers on this investment is 
wide-ranging. For example, in FY 2004, the United States signed five 
major international agreements to prevent the trafficking of nuclear 
material. The agreements are part of DOE's Megaports Initiative aimed 
at stopping illicit shipments of nuclear and other radioactive material 
through the use of specialized detection technology developed by the 
Department's national laboratories. The program also continues to 
extend the utility of three weapon types in the nation's nuclear weapon 
stockpile, and to invest across the United States to recapitalize the 
nation's national security infrastructure.

Environment
    Even as we look to the future, the Department is also exercising 
responsible stewardship of the past. The 2006 budget reflects our 
commitment to protecting the environment by providing a responsible 
resolution to the environmental legacy of the Cold War and by providing 
for the permanent disposal of the nation's high-level radioactive 
waste.
    The FY 2006 budget requests $7.3 billion for activities within the 
Offices of Environmental Management (EM), Civilian Radioactive Waste 
Management, and Legacy Management. This amount is considerably less 
than last year's allocation due to increases for Yucca Mountain and 
legacy activities, which are offset by reductions to the EM program. 
The Department is on its way to meeting its goals in these areas:

 By meeting clear, identified target dates, we are completing cleanup 
        of contaminated DOE sites. Indeed, we expect to complete 
        closure of Rocky Flatsin FY 2006.
 With the creation of the Legacy Management Office we are conducting 
        long-term surveillance and maintenance of remediated sites, and 
        overseeing the continuity of pension and benefits for former 
        DOE contract workers once cleanup is complete.
 And we are following through on the commitment to complete the 
        license application process and construction of the waste 
        repository at Yucca Mountain.
    I look forward to working with the members of this Committee on the 
many issues I have discussed, and would be happy to take any questions.

    Chairman Barton. Thank you, Mr. Secretary. Let me reset the 
clock here.
    Okay. The Chair is going to recognize himself for 5 
minutes. The Chair would also announce those members that 
deferred their opening statements, if they were actually here 
to defer, will be given an additional minute. So there will be 
some of you that get 6 minutes, some get 5, but those that 
weren't here that didn't give an opening statement will just 
get 5. You won't get 6. So if that makes sense to you.
    The Chair would now recognize himself.
    Mr. Secretary, my first question to you deals with Yucca 
Mountain. Yucca Mountain is the repository for high-level 
civilian nuclear waste. The budget submissions from prior 
Congresses have indicated that to actually construct the 
repository on a timetable that will allow it to accept waste by 
2010, we, in the very near future, need to be spending a little 
over $1 billion a year. Yet the President's budget that was put 
forward this week, I believe only funded it at $650 million. As 
you know, we have put over, I believe, $20 billion into the 
fund. Every time a kilowatt of electricity is generated by a 
nuclear power plant, a small fee, I think 1 mil per kilowatt, 
goes into this fund. What are your views on freeing the Nuclear 
Waste Fund to actually be used for construction and operation 
of Yucca Mountain?
    Secretary Bodman. Well, first, Mr. Chairman, I share your 
enthusiasm, or at least the enthusiasm I detect from the--your 
tone of your question about Yucca Mountain and the need for 
Yucca Mountain in order to further the U.S. nuclear industry's 
prospects.
    It is clear that this Administration is very focused and 
very committed to this program. What this budget does is to 
propose an amount of money that we think can be reasonably 
spent during fiscal year 2006, given the constraints under 
which we are operating. As you are aware, we have encountered 
problems with respect to the licensing network that is required 
to be put in place prior to the consideration of a license. We 
also have been challenged with respect to the standards that 
EPA is going to set, which we must meet in order to accomplish 
the licensing process. And these are going to serve to delay us 
and have--and that delay, sir, is reflected in the number that 
has been proposed in this budget. But that does not suggest 
that there is anything less than great enthusiasm for moving 
forward as aggressively as we know how.
    Chairman Barton. Well, as the executive agent of the 
President responsible for Yucca Mountain, are you willing to 
work with this committee and, hopefully committees in the 
Senate, to come up with a long-term solution to funding Yucca 
Mountain?
    Secretary Bodman. I----
    Chairman Barton. Every year of the Bush Administration and, 
prior to that, every year of the Clinton Administration, each 
year we were told yes, we need to solve this problem, but not 
this year. Well, we are actually trying to construct the 
repository, and as you pointed out, there are some legal issues 
outstanding and some environmental issues outstanding, but we 
have a goal of having it operable by 2010, and I have seen no 
study that shows, if you keep spending $500 to $600 million a 
year, you are going to have it ready for operations in 
receiving the high-level waste by 2010.
    So my question really is, as the executive administrator 
responsible for Yucca Mountain, will you work with us to try to 
find a long-term solution?
    Secretary Bodman. Yes, sir; I would be very eager to work 
with this committee to find a long-term solution to the 
problem. I would observe that this Department and the 
administration ran into some difficulties last year, and the 
tone of the proposals have attempted to reflect that. We want 
to make sure that we are properly respectful of the role of the 
appropriation process of this Congress. And I certainly need to 
pay attention to that. And in so doing, the goal is to have a 
piece of legislation that we could propose that would 
accomplish the goal that you suggest that would be in effect 
for fiscal year 2007----
    Chairman Barton. Okay.
    Secretary Bodman. [continuing] and that this money has been 
proposed for 2006 in order to give us the time to accomplish 
that.
    Chairman Barton. Okay. My time is about to expire, so I am 
going to yield back and recognize the ranking member from 
Michigan, Mr. Dingell, for 5 minutes.
    Mr. Dingell. Thank you, Mr. Chairman.
    Again, Mr. Secretary, welcome.
    You are familiar, I am sure, with the Nuclear Waste Fund 
and the fees that support it, are you not?
    Secretary Bodman. Yes, sir.
    Mr. Dingell. Now that Nuclear Waste Fund is now subject to 
litigation in the Court of Claims, is it not?
    Secretary Bodman. I----
    Mr. Dingell. Which the issue is not liability of the 
Federal Government's diversion of those funds, but rather the 
amount of the liability to the electrical utilities, which have 
contributed to that fund. Is that not----
    Secretary Bodman. That is my understanding; yes, sir.
    Mr. Dingell. Would you support an effort to set this as a 
separate fund off budget in order to prevent budgeteers, the 
appropriators and the budget folks, from diverting this money 
for purposes other than Yucca Mountain, which is the reason for 
this lawsuit?
    Secretary Bodman. As I said before, sir, this 
administration and I, on behalf of this Department, will come 
forth with legislation that would accomplish that end for 
fiscal year 2007.
    Mr. Dingell. When will you--when would you do that, Mr. 
Secretary? I have been waiting around here for about 10 years 
for that.
    Secretary Bodman. I can't speak----
    Mr. Dingell. And we get--by the way, we get this promise 
periodically.
    Secretary Bodman. I can't speak to----
    Mr. Dingell. Every Secretary gives that--gives us that 
promise.
    Secretary Bodman. Sir, I would observe, as Mr. Markey 
observed, I do have a record of some accomplishment in the 
private sector----
    Mr. Dingell. But Secretary, you haven't gotten your chair 
warmed yet but I want you to understand this is a matter of 
deep feeling by us on this committee.
    Secretary Bodman. Thank you.
    Mr. Dingell. Now having said this, the--there is something 
in the bill that we have before us to reclassify this, and what 
does that mean? In what way is that going to be reclassified 
and to do what?
    Secretary Bodman. I am unclear of your question, sir. 
Reclassify----
    Mr. Dingell. I will let you--since time is limited, I will 
let you have time to come forward with an answer to that for 
the record, because I think it is important that we know what 
this means.
    Now I would note, Mr. Secretary, that today's ``Energy 
Daily,'' Wednesday, February 9, says in a study, U.S. blackouts 
cost $80 billion according to a study released by researchers 
with the Energy Department's Lawrence Berkley National 
Laboratory. A similar estimate was made in a document, which is 
entitled ``Final Report of the August 14, 2003 Blackout in the 
United States and Canada,'' in which they say estimates for 
total cost to the United States ranged between $4 billion and 
$10 billion. And then they go on to say in Canada, the gross 
domestic product was down .7 of a percent while there was a 
loss of 18.9 million work hours as a result of this particular 
event.
    Mr. Secretary, why is it that we should wait around to 
enact legislation upon which there is broad agreement that 
would address this problem of reliability forthwith, on which 
bipartisan legislation depends? Why should we wait for a great 
big energy bill, which may or may not come during your lifetime 
and mine?
    Secretary Bodman. Mr. Dingell, it is my view that all of 
the aspects that are considered in the energy bill are pretty 
interrelated.
    Mr. Dingell. I recognize they are interrelated, but the 
shutdown of electric utilities is something which is, I think, 
freestanding. It will occur whether we drill in the arctic 
refuge or not. It will occur whether or not we have fuel 
efficiency standards on automobiles. It will occur whether or 
not we have clean coal technology. It is something which is 
quite capable of being addressed alone legislatively and 
administered alone by the administrative agencies. Why should 
we wait around with our tongue in our cheek for some kind of 
action by some--by the Senate and the House while we battle out 
an energy bill when we are at risk of having the kind of loss 
from the failure to have reliability standards properly set 
forth?
    I note, for the benefit of both of us, Mr. Secretary, that 
pending that, the standards will be voluntary and will be 
almost assuredly as workable as they were in 2003 at about 
3:15, just before the power went out. Now why can't we have--
why can't we proceed to move on this bill alone without further 
dawdling?
    Secretary Bodman. Mr. Dingell, I would not want to tell you 
how to propose legislation. I would only tell you that on 
behalf of the administration, we view this as an integrated 
problem.
    Mr. Dingell. You are telling me the administration wishes 
to dawdle?
    Secretary Bodman. No, sir; that is not what I said.
    Mr. Dingell. The administration doesn't feel the urgent 
need to move hastily to enact legislation by which there is 
bipartisan agreement, is that correct?
    Secretary Bodman. No, sir; that is not correct. I do----
    Mr. Dingell. Well, what is correct?
    Secretary Bodman. I feel the need to move forward with 
legislation that, hopefully, on a bipartisan basis, will 
include all aspects of our energy challenges.
    Mr. Dingell. I pray, Mr. Secretary, that you are alive when 
we finally pass that bill.
    Secretary Bodman. I would certainly concur in that wish, 
sir.
    Mr. Dingell. Thank you. Thank you, Mr. Chairman.
    Chairman Barton. I think we do need to point out the 
Secretary is correct. The House and the Senate have to pass the 
legislation. The President can be supportive or non-supportive, 
but only those up here on the dais get to vote on it, and that 
is not the fault of the Secretary or the President. The Senate 
didn't bring our bill up last year.
    The Chair would recognize the distinguished chairman of 
Energy and Air Quality Subcommittee, Mr. Hall, for 6 minutes, 
since he didn't give an opening statement.
    Mr. Hall. Dr. Bodman, I strongly support the President's 
call for comprehensive energy legislation, as you know, 
legislation that will help us reduce our alarming increasing 
dependence on foreign oil. And as you are well aware, most of 
the oil we consume here at home is in the form of motor vehicle 
fuels.
    It is very important to me. And I think it is important to 
Chairman Barton. It is important to the State I represent and 
to other members of this committee that we increase domestic 
use of alternative motor fuels, especially natural gas.
    With great success, countries all over the world have 
embraced the natural gas vehicle option, especially for transit 
buses, school buses, trash trucks, and other vehicles that use 
a lot of fuel. Garland independent school district, just across 
the county line has used them to run their school buses for the 
last 15 or 20 years, saving about \1/3\ of the cost that they 
normally expect. We need to do more here at home to take real-
time advantage of this cleaner, cheaper, and proven domestic 
fuel. While I know you are new on the job, and I hope can--you 
will look at and hope we can count on you to give this your 
personal support and your personal attention or give it your 
personal attention and then your personal support, if you have 
it. I look forward to working closely with you on this very 
critical matter in the future.
    I just presume that you are going to do that, and is my 
presumption correct?
    Secretary Bodman. Yes, sir; I will certainly give it my 
personal attention. All of these matters of the mix of fuels 
that we have available are a real challenge. And clearly, the 
place of natural gas as a fuel for motor vehicles is an 
important and growing fuel, certainly in major metropolitan 
areas used here and in Washington, for example. And so I 
certainly would encourage that. But we also want to look at all 
of the other fuels that are available and find ways of 
stimulating their use, especially those that are 
environmentally sound.
    Mr. Hall. And Mr. Secretary, my second question is kind of 
a complicated question, and I am going to ask you the question 
and then probably ask you to take some time with your staff to 
answer it, because there are a lot of twists and turns in it.
    According to the Department of Energy's Office of Fossil 
Fuel--of Fossil Energy, 70 percent of the oil and natural gas 
technology programs have been oriented toward exploration and 
production activities associated with the smaller independent 
producers: 15 percent has been geared toward the large 
independent with 15 percent geared toward the major integrated 
oil and gas companies. In comments attributed to you, the 
administration has concluded that the R&D activities underway 
by the Department can be better done by the private sector. 
While this assessment may have some merit regarding the portion 
of the research done by major oil companies, clearly such 
research would be proprietary property of those who did it. For 
independent producers who currently drill 90 percent of all oil 
and gas wells in the U.S., producing 85 percent of gas and 50 
percent of oil produced in the U.S., it seems unlikely that 
they will have the resources to devote to R&D programs, 
particularly what they call ``over-the-horizon programs.'' 
Currently, domestic production is benefiting from technologies 
like 3D and 4D seismic and horizontal drilling that were 
research efforts from the 1980's.
    My question will be how does the administration believe 
that the next generation of research will develop without the 
R&D program, and how will that research get to the producers 
who develop domestic production? I don't mind taking a letter 
or something from you in writing on that, unless you want to 
take a shot at answering.
    [The following was received for the record:]

    The Administration believes that the next generation of 
petroleum supply research will continue at only a moderately 
diminished pace with the close out of the Department's oil and 
natural gas research and development program.
    Much of the Department's oil and natural gas research and 
development is jointly funded by industry and the government. 
We expect that the industry component will continue, especially 
in light of the current strong economic performance of the 
industry. In addition, several companies are currently 
supporting research at major universities, which will be 
available to the petroleum community.

    Secretary Bodman. Well, if I may, Mr. Hall, I would say 
first we will avail ourselves of the opportunity of sending a 
letter and giving you a more complete answer. I would tell you 
and make the general observation, because I am sure there will 
be other questions, they have already been asked and posed in 
some of the preliminary statements.
    This year is a very difficult year from a budgetary 
standpoint, and so we have been faced with the prospect of 
making difficult choices. And it is not that this effort does 
not produce value. It is a question of how we allocate the 
value, how we judge the value of it vis-a-vis other matters. 
And so that is the ultimate issue that we get down to. It is 
not that it doesn't have value. We have been spending money on 
it for some time. But we will give you a more complete answer 
in the full.
    Mr. Hall. I thank you. And I just throw in that I hope and 
I believe you are committed, as someone has asked you here 
before, to giving the Yucca Mountain program your priority 
attention so that licensing process can move forward and 
Federal costs from undue delay be minimized.
    Thank you, and I yield back my time.
    Secretary Bodman. Thank you, sir.
    Chairman Barton. We are so glad Ralph asked too many 
questions.
    We are now going to recognize the gentleman from 
Massachusetts, home of the world-champion New England Patriot 
football team, for questions for 5 minutes.
    Mr. Markey. Thank you, Mr. Chairman, very much.
    Mr. Secretary, the Energy Information Administration, a 
part of the Department of Energy, in analyzing H.R. 6, 
determined that there would be, over the next 20 years, if that 
bill passed, the bill that was passing in the House and the 
Senate last year, that there would be an 85 percent increase in 
our oil dependency on overseas of--taking us up to 80 percent 
total dependency upon imported oil.
    Now the reality, Mr. Secretary, is that we put 70 percent 
of all of the oil which we consume in the United States into 
gasoline tanks. And what we are seeing is a dramatic decrease 
in the energy efficiency of the vehicles, which are being sold 
in our country, making us more and more dependent upon imported 
oil and bringing us deeper and deeper into the problems of the 
Middle East and the disease, which is caused by the pollution, 
which goes into the atmosphere.
    Mr. Secretary, if you accept that premise of your own 
analytical subgroup, the Energy Information Administration, 
doesn't it make sense for us, Mr. Secretary, to begin the 
process of putting in place a set of regulations that require 
that vehicles that are sold in the United States become more 
efficient, not less efficient for the sake of succeeding 
generations to the one that lives today?
    Secretary Bodman. First, Mr. Markey, it is nice to see you 
again, sir.
    Mr. Markey. Good to see you, sir.
    Secretary Bodman. Second, I would not challenge, although I 
am not familiar with the details of the EIA report. I would 
suggest to you that this administration has taken a number of 
steps that will start us on the path of lessening the 
dependency on foreign oil. We have made significant investments 
in hydrogen, significant investments in the nuclear area, 
significant investments in other novel programs, coal 
advancements, that would help us remove the pressure on oil, 
the pressures caused by our increasing dependency on oil.
    As to the CAFE requirements, which is what I think you are 
suggesting, those are not my province. Those are the province 
of the Department of Transportation, and I would note that in 
passing. I will comment on it, but I want to make it clear that 
I have a lot of things to do here, but that is not one of them.
    Mr. Markey. Well, let me just--let me then move over to 
something that you do have jurisdiction over.
    Secretary Bodman. Okay.
    Mr. Markey. And that is the legally mandated Energy 
Efficiency Standards. There are 22 rulemakings that are not 
moving forward at Department of Energy on air conditioners, on 
furnaces, on 22 different areas----
    Secretary Bodman. Right.
    Mr. Markey. [continuing] that could save our country the 
need to build 100 large coal or nuclear-fired power plants over 
the next 10 or 15 years.
    Secretary Bodman. Right.
    Mr. Markey. What are you going to do, Mr. Secretary, to 
help our country work smarter, not harder, so that we improve 
our technology and not have the Department of Energy sit on 
legally mandated rulemakings that this committee produced in 
1987 as part of my Energy Efficiency Act and the 1992 Energy 
Act? What are you going to do?
    Secretary Bodman. I have actually queried the staff that 
are working on that particular matter, in part in preparation 
for this hearing, and in part because I was interested in 
having read the long article in the Washington Post on this 
exact subject, which you probably have seen yourself, sir.
    Mr. Markey. I was quoted in it, yes, thank you.
    Secretary Bodman. I had forgotten that. Forgive me.
    In any event, I have become convinced, one, that 
significant effort is underway, two, that there were changes 
that were made de facto in the late 1990's in terms of what the 
approach to setting efficiency standards would and should be. 
And these were decided by both the manufacturers on the one 
hand and the efficiency advocates on the other hand as to what 
approach it would be. And the decision was that it would be a 
transparent process. It would be very rigorous, but alas, 
unfortunately, very time consuming. And it does take a long 
time to go back and forth if everybody is going to have a look 
at it and understand it. I am informed that we are in the late 
stages of being able to propose tentative rules for commercial 
air conditioning, for residential furnaces, and I have 
forgotten the third----
    Mr. Markey. Over what time period?
    Secretary Bodman. I would think over the next few months, I 
would think. I don't have a fixed timeframe. Sir, I have been 
there 7 days, and so you know, I would ask for your indulgence.
    Mr. Markey. We have 3 percent of the world's energy 
reserves. That is our weakness. We are America's and the 
world's technology leader.
    Secretary Bodman. That is true, sir.
    Mr. Markey. That is your background----
    Secretary Bodman. That is right.
    Mr. Markey. [continuing] and I hope that you impress us 
upon an Energy Department that has ignored that for a 
generation.
    Secretary Bodman. Would you say that again? I didn't 
understand that.
    Mr. Markey. I hope that you impress it upon this agency----
    Secretary Bodman. Oh.
    Mr. Markey. [continuing] that has ignored technology 
improvement for a generation.
    Secretary Bodman. We will. We are going to work very hard, 
if I may say so, sir, in terms of technology and what its 
impact can be, but I also, sir, hope that I am not sitting here 
explaining to you a year from now that we have a lot of 
promises that we have not kept. And so I will do my very best 
to be able to come in here and tell you that we have said we 
would do whatever it is we have said we would do and that we 
have done it.
    Mr. Markey. Good luck, Mr. Secretary.
    Secretary Bodman. Thank you, sir.
    Chairman Barton. Mr. Markey, you are slipping a little bit. 
When you said you had only been there 7 days, in the old days, 
he would have said, ``Well, God created the world in 7 days.'' 
But you know, he is basking in the glow of his Patriots' 
victory, not on the very----
    Secretary Bodman. Mr. Barton, I have to admit, sir, so am 
I.
    Chairman Barton. Oh, no. Well, I am basking in the Cowboys' 
6-10 season myself.
    The gentleman from Michigan is recognized for 6 minutes.
    Mr. Upton. Thank you, Mr. Chairman. And Mr. Secretary, 
welcome.
    Secretary Bodman. Thank you, sir.
    Mr. Upton. We all appreciate your honesty, your integrity, 
your good faith, and your good will. I know that you will be a 
successful Secretary of Energy, and I look forward to working 
with you during the years of service that you are going to 
provide our great country.
    For lots of reasons, I support a comprehensive energy bill, 
and they would take me beyond the 6 minutes that the chairman 
has allowed me, so I am going to talk just about three 
priorities that I have, and I would welcome your thoughts.
    First of all, I co-chair the auto caucus. Alternative fuel 
cell vehicles are very important to the future of this country 
for many, many reasons, and it is exciting to see those wheels 
of change begin to come to the marketplace. This last summer, I 
drove a couple of the vehicles that are produced now by the Big 
Three, and I am glad to see that some of them are on the 
showrooms. In fact, my staff actually bought one 2 weeks ago, a 
new Ford Escape, so I am excited to see that. But obviously, 
incentives for the industry, I think, will be of tremendous 
importance to all of America and the rest of the world.
    Second, I want to echo the chairman's comments about Yucca 
Mountain. For me, I have two nuclear plants in my District on 
the shores of Lake Michigan. I help lead the effort on Yucca 
Mountain to have one safe place for this high-spent nuclear 
waste. And of course, today, we have it along the shores of the 
Great Lakes, the Chesapeake Bay, virtually every important 
river and lake in the country, and we need one safe place. And 
so your energy devoted to seeing Yucca Mountain open on 
somewhat of a timely basis, knowing that we are already 
delayed, is very important.
    And third is the safety of our nuclear labs. Mr. Engel and 
I, on a bipartisan basis, just returned from North Korea to try 
and get the Korean Peninsula to be a nuclear-free zone and 
working with the other countries in the region, many of them 
our allies, to try and see that accomplished. Nothing scares me 
more than the transfer of our nuclear secrets to those that 
will abuse them and perhaps use them in a very evil way. And as 
chairman of the Oversight and Investigation Subcommittee 
several years ago, I helped, again, with the effort to expose 
the problems at our nuclear labs. We saw that a culture change 
was really needed. I am not sure that we have actually 
accomplished that yet, but your work, your message, your 
suggestions to us to make sure that we clamp down on that 
security is very, very important and maybe, perhaps, the most 
important thing you do as Secretary.
    So I would appreciate your thoughts on that in the 
remaining 3 minutes that I have.
    Secretary Bodman. Well, I will take them in reverse order. 
I have not been to the labs, as you know, but I have strong 
feelings, both on the safety of our workers who work in the 
labs, as well as the security and the responsibilities that the 
staff who manage these labs, who work in the labs, have to the 
care of our nationally important information, that any 
classified information has got to be handled carefully and 
thoughtfully. I am led to believe that there have been some 
substantial improvements made. I will reserve judgment on that 
until I get there myself, which I intend to do at an early 
date. So I can't do anything but agree with you on that.
    With respect to the Yucca Mountain, I have stated that this 
President and I and all people that I know of in this 
administration are very enthusiastic about proceeding. We need 
Yucca Mountain to be in place for exactly the reasons you 
mentioned. It will facilitate the operation of our nuclear 
industry. This is an industry that has had major problems, and 
it is something that I think will be a very high priority on my 
list.
    And then last, we have done a lot with respect to fuel cell 
development. I eluded to it in my opening remarks. We have 
reduced the cost here over the last couple of years, and we are 
now down within gunshot of having something that is potentially 
commercially possible. I have yet to personally get into 
looking at, in some detail, back to Mr. Markey's point, to put 
some of the technical background that we have available--I have 
available to me in terms of looking at is this possible and is 
it likely that this is going to happen. We have a lot of 
aspirations and goals that our staff is very enthusiastic 
about. I am enthusiastic about it. I just want to make sure 
that we are being as realistic as we should be, and I will be 
looking hard at that myself.
    Mr. Upton. Well, just--let me just follow up on that and 
two things. One, Michigan, you know, is known as the auto 
State, but beyond Michigan, one in seven jobs across the 
country is auto-related. And as you told a number of us 
yesterday, you intend to travel the country, looking at ways to 
be a better steward of our energy supplies. I would invite you 
and welcome you to join with me, and other members of the 
caucus, Mr. Dingell is a very important member as well as Mr. 
Barton, to come to Michigan to look at some of the advancements 
that we are making in that technology.
    And even during this last break, I was out at one of my 
companies called Eaton making truck axles. They have got some 
new engineering ready to go into place that is going to improve 
the efficiency of truck axles by as much as 20 percent. When 
you think of all of the trucks on the highways, you think of 
these developments, and they are doing that without incentives. 
So you can imagine where we would be without it. So I welcome 
the Secretary to come to Michigan. We will have some good 
times.
    Secretary Bodman. Thank you, sir.
    Mr. Upton. I yield back.
    Chairman Barton. I thank the gentleman.
    And we would recognize the gentleman from New York for 5 
minutes.
    Mr. Engel. Thank you, Mr. Chairman. And welcome, Mr. 
Secretary.
    I am very frustrated, very much, over the energy bill. I 
wasn't a supporter of it in the last Congress, and I was hoping 
that, in this Congress, we would perhaps be able to really 
truly craft a bipartisan bill that I could support. I don't 
understand why we have such a rush to pass this legislation 
when we should take more time to get it right.
    Oil is $50 a barrel, and we still haven't passed 
reliability standards to address the electricity blackout that 
assaulted the Northeast and Midwest in 2003. And I believe that 
rather than stay mired in this same, tired gridlock of partisan 
politics, we have to make the choice to move forward, even if 
it involves some hard and bold choices.
    Mr. Secretary, I am very intrigued by the bipartisan 
National Commission on Energy Policy's Report titled ``Ending 
the Energy Stalemate.'' Their report was released in December, 
this past December 2004, and is the product of 16 members with 
diverse expertise and affiliations representing business, 
government, academia, and the non-profit community. The 
Commission's work is designed to ensure affordable and reliable 
supplies of energy while responding to growing concerns about 
energy security. Not every member of the Commission supported 
every idea, but the ideas, as a package, won broad consensus 
among the group. With debate over 3 years, the Commission 
attempted to break the deadlock by compromising on issues 
including enhancing oil security, increasing energy efficiency, 
and developing energy technologies for the future. And I very 
strongly believe we can learn from their example.
    So Mr. Secretary, I plan to introduce legislation 
implementing the National Commission on Energy Policy's 
recommendations so that Congress can consider ``a more 
comprehensive and balanced approach to providing,'' and again I 
am quoting you, as I did in my opening statement, ``reliable, 
secure, affordable, and environmentally responsible supplies of 
energy for our growing community.''
    Mr. Chairman, I ask for unanimous consent to submit the 
summary of the Commission's report into the record.
    Chairman Barton. Without objection, so ordered.
    [The report is available at www.energycommission.org.]
    Chairman Barton. And the Chair would note that he has read 
the report himself.
    Mr. Engel. Thank you, Mr. Chairman.
    And Mr. Secretary, my first question is I want to ask you 
if you are familiar with the National Commission on Energy 
Policy's report. And hope--I want to ask you if I can count on 
your willingness to work with me and others on the 
recommendations made by the National Commission on Energy. That 
is my first question.
    My second question involves the fiscal year 2006 budget 
submitted by the administration. I wanted to address my 
concerns about the Weatherization Assistance Program, which has 
been flat-funded in the budget, and LIHEAP, which has been cut 
in the budget. The Department of Energy's corps program, the 
Weatherization Assistance Program, reduces energy costs for 
low-income families through increased home energy efficiency, 
and this is a solid investment in lowering these families' 
heating bills. New York has the largest weatherization LIHEAP 
program in the Nation and gets the most funding in the country 
from DOE. And the Bronx, which is part of my constituency, gets 
10 percent of New York's funding, so I am very, very upset with 
that.
    I am wondering if you can address both issues that I 
mentioned. And again, I welcome you and wish you success in 
your new endeavors.
    Secretary Bodman. Well, first, Congressman, thank you for 
your good wishes.
    Second, I can't tell you I have read all of that report, 
but I have certainly looked through it and spent some time 
looking at the recommendations. And there is a lot in there 
that I find very attractive. I am not sure I can support each 
and every one, and I didn't come prepared to dissect that with 
you, but I would certainly be anxious to work with this 
committee in terms of looking at which parts of that seem, at 
least to me, to make sense and to the administration to make 
sense. And so I agree with you. I thought that the process that 
they undertook was useful and produced a very interesting 
product.
    Second, with respect to the budget on weatherization, you 
are right. This is something that, at least as I have looked at 
it, has been an important part of what this administration has 
offered up over the past 4 years. I guess I would view it as 
that we have kind of learned our lesson. Whatever number we 
seem to put in, we seem to get back $230 million. So we decided 
this time, especially during difficult times, we would ask for 
$230 million. I think last year we asked for $280 million and 
we got $230 million, and I think there were similar results 
from the year before. And so that is why we asked for what it 
was that we got last year.
    Mr. Engel. So I thank you, and in the 10 seconds I have 
left, I just would hope that you would work with me and others 
and the chairman on the National Commission on Energy's Policy 
report. I really--there is not everything in there that--to 
which I agree, but I believe that it is a solid effort to 
really put together a policy that I think would benefit this 
country a great deal.
    Secretary Bodman. All right, sir. Thank you.
    Mr. Engel. And that is why I am going to introduce this 
legislation. I thank you and thank you, Mr. Chairman.
    Chairman Barton. I thank the gentleman.
    The Chair would point out that the--in the energy bill last 
year, LIHEAP was increased to $3.4 billion.
    Secretary Bodman. Thank you.
    Chairman Barton. The gentleman from Kentucky is recognized 
for 5 minutes.
    Mr. Deal. Thank you, Mr. Chairman, and thank you, Mr. 
Secretary, for joining us here today. We appreciate your being 
here and wish you the very best in your new challenge. And we 
know that there will be a lot of challenges.
    As I had mentioned yesterday in a meeting that we had an 
opportunity to visit with you, I represent Paducah, which has 
the Gaseous Diffusion Plant, the only one in which the--uranium 
is being enriched today. And there are two major cleanup 
efforts going on there. Of course, the contract that the 
Department of Energy has with Becto Jacobs expired in September 
of 2003. And that has now been extend four times, as you have 
sought to decide on a new contractor. And that decision was 
made, and now I think three companies are challenging that 
decision. And so it has placed--it has delayed the entire 
process of the cleanup, and it has been pretty frustrating for 
a lot of interested people.
    In addition to that, I had mentioned the DUF-6 plant 
yesterday, and Congress has authorized the DUF-6 plant. 
Congress has appropriated money for the DUF-6 plant. 
Originally, we had a goal of starting that plant in 2007, and 
we are already 16 months behind in the plant and the 
construction process. And I just wanted to urge you, as you 
take on these new responsibilities, to do everything that you 
can to expedite both of those situations. And if there is 
anything that we need to do here in the Congress to help or 
facilitate that, I just wanted to commit to you that we 
certainly would be willing to try to do that.
    So that is the first point I would like to make.
    The second point is our most abundant resource is coal. Our 
most economical power source is coal. The demand for 
electricity is projected to increase by 50 percent by the year 
2025. We have technology, clean coal technology that is 
available that would meet all of the clean air standards, and I 
certainly hope that you would be a real proponent of the coal 
industry, because I think it is best available for the people 
in our country. Low-cost electricity can help an economic 
expansion, an economic growth and create more jobs. And I 
certainly hope that you would support that.
    And I want to just touch on one other thing, and I would 
like to give you an opportunity to respond. Yesterday, Mr. 
Walden had mentioned that he was very much concerned about the 
administration's proposal to allow the Power Marketing 
Administrations to increase the cost of power that they sold to 
the regional co-ops and other entities. And many of those, the 
Southeastern Marketing Power and the Bonneville Power and so 
forth, are--there are some relatively large areas of 
unemployment and low economic growth in those areas. And if you 
increase the cost of power in those areas, I think it will have 
a dramatic impact on opportunities for further economic growth.
    So many of us are concerned about that proposal, but I 
would appreciate maybe your brief comments on those three 
areas.
    Thank you.
    Secretary Bodman. First, with respect to the DUF-6 or 
Uranium Hexafluoride plant, I did inquire about that, following 
my discussion with you, sir. And in terms of the--what I have 
been told by those at the Energy Department, they are moving--
we broke ground last summer on schedule, and I am surprised 
that your comment that we are that far behind that you say that 
is inconsistent with what I have been told. You may be right. I 
may be wrong. But we will certainly get you the facts on that. 
Page 64, Line 1294
    [The following was received for the record:]

    Today, site preparation work is almost complete and 
construction of the administration and warehouse facilities at 
each site is about to commence. However, we are fourteen months 
behind the original contract estimate of 2006, but expect to 
start operation in 2007. The Department has not been satisfied 
with contractor's performance and is holding the contractor 
accountable. Additionally, DOE has stepped up oversight and 
interfaces to ensure expectations are being met.

    Secretary Bodman. All I can tell you is that from the 
Energy Department's standpoint, this is a matter of law, and we 
are going to do this. It has been passed by the Congress. It 
has been signed by the President. And we have been instructed 
to do it, and we are doing it, as best I know. And so we will 
continue with that, and you may be assured that we will 
continue to maintain our focus there.
    With respect to coal technology, I think I eluded to that 
before, but I would just reiterate it. I guess I have heard us 
described as the Saudi Arabia of coal and at least we have a 
disproportionate share of coal reserves compared to other 
countries. It is certainly in our interest. We have coal of a 
wide variety of quality and potential environmental problems. 
And this Department has, over the years and in this budget, 
proposed increases in various approaches to improving the coal 
technology, including a commitment on moving forward on the 
FutureGen project, which is an important part of coal.
    The third question you asked I lost track, sir. Is this on 
PMAs?
    Mr. Deal. Yes, sir.
    Secretary Bodman. This was on the PMAs and the Power 
Marketing Association. This is strictly an effort that the 
administration has made during stringent economic times to try 
to bring more effective business practices to these 
organizations and to allow them to modify their rates, the 
prices they charge to their customers more in keeping with 
independence of the management. Now these organizations are 
kind of strange birds. On the one hand, they compete against 
the private sector. On the other hand, they are non-profit 
organizations, and so they have aspects of both. But the 
administration feels that this proposal will help bring about 
greater efficiencies in the management of these and hence the 
idea of allowing them to gradually increase rates and also to 
clarify just what they categorize as debt. A lot of these 
organizations have gotten very creative in terms of different 
financing techniques, and so this was a matter that our--that 
those changes in financing techniques were not necessarily 
covered in the laws setting these up, and if you will, I view 
it as sort of modernizing just what is debt, what isn't debt, 
and how to clarify it.
    So those are the efforts, and that is the reason for it.
    Chairman Barton. The gentleman's time has expired.
    The gentleman from Maryland, Mr. Wynn, is recognized for 5 
minutes.
    Mr. Wynn. Thank you, Mr. Chairman. Thank you, Mr. 
Secretary.
    Just a couple of quick questions, and I know that you are 
new to the job. But in 2002, the President recommended Yucca 
Mountain as a site for the repository for nuclear waste. 
Unfortunately, we haven't moved to the next step, which was the 
submission of a licensed--construction license application to 
the NRC. Now we were supposed to do that in December of this 
year, but that didn't happen. That was according to the 
schedule. And these delays are costing us, as much as, perhaps, 
$1 billion a year, based on previous DOE testimony for costs 
associated with defense waste alone in Washington and States 
like Washington and South Carolina because of our delay and 
because of our delays in moving the civilian fuel, which was 
supposed to begin in 1998.
    I would just like to get your comments on what you intend 
to do to make sure that this application goes in as soon as 
possible.
    Secretary Bodman. Mr. Wynn, first, it is nice to see you 
again, sir.
    Second, I intend to work very actively with those members 
of our staff who are responsible for repairing the material 
that needs to be made available on the Internet as a part of 
the licensing process that the NRC has. The Nuclear Regulatory 
Commission has a procedure that 6 months in advance of any 
licensee application, the applicant has to have a full data 
base, if you will, available. We provided that last summer. We 
were sued and were found wanting in that regard, and we are 
trying to make good on that. So we now have roughly twice as 
many documents and materials. I asked the folks when they were 
going to be done. I don't have a clear answer, but they did say 
they were starting to run out of things that they could 
conceivably put on there. So that is point one.
    Mr. Wynn. Can I ask--can I interject just a quick 
question----
    Secretary Bodman. Yes, sir.
    Mr. Wynn. [continuing] on that score?
    Can you advise the committee as to how soon you think that 
you can get that documentation up on the Web for public 
consumption?
    Secretary Bodman. I can't give you any more than I have 
just told you, sir.
    Mr. Wynn. Okay. All right.
    Secretary Bodman. But I have only been there 7 days and 
nights.
    Mr. Wynn. Okay. That is okay. That is certainly fair.
    I would like to follow up with you on that.
    Secretary Bodman. Sure.
    Mr. Wynn. Let me say that I am very pleased that the budget 
did include an increase for hydrogen fuel development. I think 
that is very positive.
    I am concerned, however, that we don't seem to be making 
near as much progress in terms of our nuclear portfolio. And I 
would like to get your thoughts on how we can improve at a time 
when most of Europe and Japan and other countries are 
significantly increasing their use of new generation nuclear 
fuel. Where are we going, because right now we seem to be 
pretty stagnant?
    Secretary Bodman. That is a very good question, sir.
    I guess there are two components to this. The first is this 
initiative called 2010, and that one is geared to an 
improvement in the capability of our private sector to go 
through the licensing process, to go through the siting 
process. We have almost a self-fulfilling prophecy in our 
country. We have been 20 years without a new nuclear plant that 
have been objected to in various forums when I was much 
younger, and we are now in a situation where I think there 
seems to be a greater interest in this field. I can tell you 
from having spent many years in and around MIT, the MIT Nuclear 
Engineering Department almost has fallen into disuse, and there 
are just very few students interested in that field because it 
is hard to get jobs. And so they tend to move off elsewhere. 
And so our effort in the Department is to provide funding, to 
provide some new approaches to seek out regulatory approvals, 
licenses, siting decisions and so forth earlier, and so that is 
one big piece.
    The second piece is more technical and that is the so-
called NGNP, the Next-Generation Nuclear Plant, and that one we 
have money in the budget to continue that. We will be 
continuing our work in terms of deciding just what the process 
should be. It is probably a little too detailed to go into 
detail here, but suffice it to say, it is a very high-
temperature process, and there are still choices that remain to 
be made, and we will continue to work on that this next year.
    Chairman Barton. The gentleman's time has expired.
    Mr. Wynn. Thank you very much, Mr. Secretary. Thank you, 
Mr. Chairman.
    Secretary Bodman. Yes, sir.
    Chairman Barton. The distinguished gentleman from Georgia, 
Mr. Norwood.
    Mr. Norwood. Thank you very much, Mr. Chairman.
    Mr. Secretary, it seems to me that this would be a very 
exciting time to be the new Secretary. I think you have got 
some real possibilities to do some great things for this 
country in the next couple of years, and----
    Secretary Bodman. I hope you are right, sir.
    Mr. Norwood. Well, we are counting on it. We all wish you 
well. We are all very interested in many things. I associate 
myself with Ed Whitfield on the PMAs. I associate myself with 
the chairman on Yucca Mountain. I--and the--I mean, there are 
just so many things to ask, we are going to ask a lot of it in 
writing and give you a fair time to respond and answer----
    Secretary Bodman. Thank you.
    Mr. Norwood. [continuing] because I understand, being there 
just 7 days.
    But if you will permit me, I would like to focus just a 
little bit on personal things.
    I am a big believer in Mox Fuel. I have had the opportunity 
to spend a great deal of time in the plants in Britain and in 
France, and Lord knows, if they can do it, we certainly ought 
to be able to do it, and should do it. And I am also a big 
believer in modern facilities. I think that is absolutely 
essential to the security of this country. And I guess 
selfishly, I am very happy that those--perhaps both will end up 
at the Savannah River Site.
    The problem is, as we speak, I have very loyal, talented, 
smart people being shown the door today, as we talk. And they 
are being shown the door because they did a great job. They 
actually got that environmental cleanup done early and did it 
very well, and we are proud of them, but on the same hand, 
these are the types of people that we are going to need when 
finally we do get a mix oxide fuel plant.
    I was discouraged a little bit, not a lot, but a little 
bit, that it seemed to be a reduction in the budget for that. I 
have talked to Secretary Abraham about this, what was holding 
the darn thing up, and of course, last year, he said, and 
truthfully so, that the Russians were dragging their feet.
    Now it has been a year, and I know you can't answer 
precisely, but I would like to get a little feel for what is 
holding this thing up now. And again, I know you can't answer 
exactly, but what is your best guess when we might start 
construction on that thing so we can utilize these people that 
have devoted their lives working at SRS?
    Secretary Bodman. Well, first, sir, I would empathize with 
you and with you and with the people who are facing being laid 
off. It is a terrible thing. It is a hard thing for anybody. 
And so I understand that and have some sense of it.
    Mr. Norwood. But see, we can rejoice in a job well done.
    Secretary Bodman. No, no, I understand.
    Mr. Norwood. When you are through, you are through. But I--
--
    Secretary Bodman. Oh, in terms of my understanding of the 
situation with having said that, I can't comment anything more 
in terms of what and where the jobs are. I can say that there 
is an issue with respect to the Mox facility that we have now--
the goal here was to have both U.S. as well as Russian material 
used simultaneously and that this was viewed as being an 
important part of our nonproliferation effort. And we have had 
a significant delay that has been caused, as Secretary Abraham 
mentioned to you apparently a year ago, because of the 
discussions over liability and where the liability would be, 
based on what I have been told. I am cautiously optimistic that 
we have started to crack that code, and there may be more 
reason for optimism on that subject than there has been in some 
time. Having said that, there is a discontinuity here in terms 
of when things can be started and when decisions have to be 
made. And there is going to be a delay on account of the way 
that the system works in terms of any construction there. And 
so I can't give you a number.
    Mr. Norwood. Well, I sort of realize that, but if you 
would, keep us informed and perhaps give them a swift kick in 
the britches to--let us get this thing going, because it 
affects a lot of people's lives.
    Secretary Bodman. I understand.
    Mr. Norwood. We also recognize that the modern pit 
facilities in your budget got a 9-percent increase, and I am 
assuming from that, that that probably is a commitment from the 
administration to move the modern pit facility forward at SRS. 
Am I reading that right?
    Secretary Bodman. To my knowledge, there has not yet been a 
decision made in terms of where the pit facility would go.
    Mr. Norwood. But there is only really one location it would 
work well at.
    Secretary Bodman. I appreciate that would be your view, 
sir.
    Mr. Norwood. I think it will be yours in another 7 days.
    Secretary Bodman. Yeah.
    Chairman Barton. It is obvious that Congressman Norwood has 
recovered. He is in good form.
    The gentleman from Texas, Mr. Green, is recognized for 5 
minutes.
    Mr. Green. Thank you, Mr. Chairman, and I would like to 
welcome our good friend, Charlie Norwood, back to the 
committee. And I do think he has recovered.
    Mr. Secretary, welcome to our committee. I am on this side 
of the aisle, and--but the nature of the District I represent, 
it is along the Gulf Coast in Houston, and so as a former 
chemical industry executive, I know you understand the concern 
we have with the sustained high natural gas prices. I tell 
people it seems heresy for a Texan to say we have too high 
natural gas prices, but it is threatening our international 
competitiveness with our chemical industry and in my area 
particularly, and I know some in Congressman Strickland's, too, 
along the Ohio Valley. We have a--those high-paying jobs are 
awfully important, but also for our own country.
    First of all, and I know that you mentioned in your opening 
statement your support for ANWR. And again, there are some of 
this on this side of the aisle who support additional exploring 
for domestic energy, including ANWR and the pipeline. I also 
hope that the Department is well aware of more recent 
discoveries in Cuba that foreign energy companies are actually 
drilling closer to the State of Florida than we allow our own 
companies to do from our government. And it is frustrating 
because, particularly with the recent discoveries in the 
northwest part into the Gulf of Mexico, I think we need to look 
at the eastern Gulf that probably has some of the most 
lucrative potentials for natural gas. Is that something the 
Department will look at, not just in ANWR but other locations 
around our country?
    Secretary Bodman. First, let me, if I may, talk to you 
about natural gas prices, and then I will try to touch on the 
other----
    Mr. Green. Okay.
    Secretary Bodman. [continuing] question you asked. With 
respect to natural gas prices, I agree with you. Most of the 
recently licensed electric-generating facilities are powered by 
natural gas, being driven by the environmental considerations. 
And I favored that back in the day, some years ago, when I had 
something to do with the natural gas industry. It is clearly 
driving prices, and it is affecting our chemical industry. It 
is affecting a lot of other industries that depend on natural 
gas as either a raw material or as a fuel. That is why I think 
the idea of dealing with this matter, the energy situation, in 
a balanced way, we have got to have more focus on nuclear and 
getting our nuclear energy going. We have to have more focus on 
coal in order to try to get the coal with carbon dioxide 
sequestration, with the potential of producing hydrogen from 
ultra-high----
    Mr. Green. Mr. Secretary, I don't have a lot of time, but--
--
    Secretary Bodman. All right.
    Mr. Green. So--and I agree with you. I believe we ought to 
expand nuclear and----
    Secretary Bodman. All right.
    Mr. Green. [continuing] again, clean-burning coal.
    Secretary Bodman. Okay.
    Mr. Green. But I mainly wanted to make sure that, you know, 
we have some other fields that are--for natural gas, and I 
support it, because again, not just from where I come from, but 
also it is clean-burning, and we see in our utility bills and 
with the high costs, but also for our industries that may move 
overseas.
    I know there is another piece of legislation that I would 
like to see in the energy bill, as Congressman Terry, in our 
last Congress, introduced an LNG bill to streamline the 
permitting process for liquefied natural gas to bring that in 
the small percentage that would be available to--that would 
also, hopefully, Mr. Chairman, if we have a markup on the bill, 
we would actually see that as an amendment to the bill to 
expand our opportunity to have what we can with LNG and to 
streamlining that permitting process.
    Secretary Bodman. Anything that could be done, sir, on that 
front, we would be very interested in.
    Mr. Green. Okay. I know you talked about--with my fellow 
Texan, Ralph Hall, earlier about improving our technologies and 
recovering more resources as are currently possible, and I 
know, if you would, whatever you provide to Congressman Hall, 
there is--if you would do it to all of the members of the 
committee, because I would like to see how we can more 
efficiently recover more of our resources. And again, if we 
don't have to drill as many holes in the ground, it is cheaper 
for all of us.
    The last question I wanted to ask is that--and how can we 
use these resources more efficiently. Recently, there were 
proposals to more efficiently utilize our natural gas power 
plants through a concept called Efficient Dispatch. And I know 
I hear from some of the folks in the power industry and that is 
a new issue since we have actually drafted the energy bill last 
Congress, does the Department of Energy have any information or 
is considering that idea on the efficient dispatch for our 
natural gas power plants?
    Secretary Bodman. I can't tell you the specific answer to 
that. I can tell you that generally we have a lot of interest 
in all matters that will help us dispatch and manage our 
electric grid in a better fashion than we are now doing. We 
have a real problem in doing that due to the very eclectic way 
our electric system has been put together. And in part, the 
energy bill was attempting to deal with that, and we are going 
to continue our efforts to try to be successful there.
    Mr. Shimkus [presiding]. The gentleman's----
    Mr. Green. Thank you, Mr. Chairman. And hopefully, if we 
have a markup, we might see something that would improve our 
energy bill from last Congress.
    Mr. Shimkus. I know you are a great advocate. We are glad 
to have you on board.
    The Chair now recognizes the gentlewoman from Wyoming for 6 
minutes.
    Ms. Cubin. Thank you, Mr. Chairman.
    First of all, Mr. Secretary, I want to thank you for 
joining us. I look forward to working with you. As you know, I 
was instrumental in a relatively good-sized portion of the 
energy bill that passed through the Resources Committee, and I 
am very adamant that we need to get this done. I think it is a 
national security issue, and others as well.
    And I know you have talked a little bit about the rate 
increase to market value. I heard the question Mr. Whitfield 
had, but I would like to follow up on that a lot.
    Wyoming is far, far, and away the largest Federal mineral 
producer. And so we have coal, gas, oil, uranium, wind, solar. 
We have it all. So I am really not trying to favor one energy 
over another. But I do want to talk about coal. Regarding the 
proposal to raise the power rates for the Western Area Power 
Administration at 20 percent per year until they reach market 
value, I really have serious concerns how this recommendation, 
if it is enacted, will affect Wyoming consumers. We call it 
WAPA, the Western Area Power Administration, is a very 
important power source for us. And they will have to increase 
the rates on the constituents in my State. You know, this is a 
non-profit organization, and I understand the difference 
between some non-profits and other non-profits, but there are 
some non-profits that really are. And so the only thing that 
can happen with that 20 percent increase in rates is it does go 
through to the consumer. And even GAO says that market rates 
for consumers in these areas will be about $200 more per year, 
even in the short term. I understand it is going to be gradual, 
but in the short term, it is still $200 a year anyway.
    So I guess what I just would like to ask you is if you have 
any comments about what I have said, but also if the 
administration would be open to having a discussion with us 
about this to see if there isn't some way we can mitigate this 
cost to consumers.
    Secretary Bodman. First, this administration is always open 
to meeting and talking with any Member of Congress about 
anything that you have an interest in. So that is that.
    Ms. Cubin. Thank you.
    Secretary Bodman. Second, these are difficult budget times. 
And what you are seeing here, in my judgment, is the reflection 
of the enormous pressure that has been on the entire 
administration to try to find all sources of income that make 
sense.
    Ms. Cubin. Um-hum.
    Secretary Bodman. It is also an effort to try to see to it 
that some taxpayers are not subsidizing other taxpayers.
    Ms. Cubin. Right. Right.
    Secretary Bodman. And that is how one could view it. If you 
are not a participant, one is not a participate in one of these 
PMAs, then one could view it that I am subsidizing your 
constituents.
    It is a tough thing for the constituents, because all of us 
get used to a certain way of doing things----
    Ms. Cubin. Sure.
    Secretary Bodman. [continuing] certain costs and so forth.
    Ms. Cubin. Sure.
    Secretary Bodman. So----
    Ms. Cubin. I understand. I know----
    Secretary Bodman. [continuing] we will be happy to talk to 
you about it, but that is why this has been done, and that is 
what the proposal is.
    Ms. Cubin. Well, I think at their peril, they will try to 
help balance our budget problems on the backs of rural America. 
And you know, when you have a country like ours, that is as 
diverse as ours, while some things the Federal Government, or 
you know, like postage, and in this case, PMAs, maybe some 
eastern and West Coast people pay more and we pay less. On the 
other hand, we pay for Amtrak services that we don't get--there 
is no Amtrak facility at all in Wyoming--so I guess I just 
caution you in that regard that in rural America and Wyoming in 
particular, I don't want to have this balanced on their back.
    I totally agree with the budget cuts. I intend to support 
the President. I am really glad that he had the courage to make 
the recommendations that he did. I would question the wisdom of 
one, however. While I also support development of ANWR, I think 
it is not the only solution to our domestic energy problem. And 
while your Department deserves credit along with the President 
for making it a good attempt at decreasing Federal spending, I 
have to question the phase-out of the oil and gas technology 
programs. This is one area where actually money could be 
generated through the technology that these programs have 
developed. In my own State, R.M.O.T.C. has developed programs--
or not programs, but technologies of tertiary production and it 
seems that this cut is a short-sighted thing to do when an oil 
well is considered depleted, there is still 70 percent of the 
oil in the ground. And I don't want to see us hang our hat on 
ANWR and neglect the other oil deposits that are around the 
country, if you would make a comment on that.
    Secretary Bodman. I can't disagree with anything you say 
other than to say that this is all a matter of tradeoffs and, 
sort of, where does one get the best return. In theory, in 
this, not category of expenses that that oil and gas program 
falls into, the hope is that all of these will lead to getting 
more back, that our society will get more back than we put in. 
That is the goal of all of them. The question is trying to make 
a balance. And so that was the goal of it. And so I can't say 
anything more than that.
    Thank you.
    Mr. Shimkus. The gentlewoman's time has expired.
    The chairman recognizes the gentleman from Ohio, Mr. 
Strickland, for 5 minutes.
    Mr. Strickland. I thank you, Mr. Chairman.
    Mr. Secretary, I have a number of questions, and I realize 
that you are new, and we all want to get questions to you. I 
would like to submit questions for the record, but there are 
two matters that I would like to bring to your attention today 
and see if you would respond to them.
    First of all, I represent, or I did represent, a facility 
that enriched uranium, and the workers there come to me with--
and they describe a catch-22 situation.
    Secretary Bodman. This is the Portsmouth facility?
    Mr. Strickland. The Portsmouth facility.
    Secretary Bodman. Absolutely. Right.
    Mr. Strickland. Absolutely.
    Secretary Bodman. Right.
    Mr. Strickland. Workers say they want to work at the 
facility, subcontractors want to hire them, but they don't have 
clearance. And the subcontractors say they can't hire them 
until they have clearance, and they can't get clearance until 
they have a job. And so the subcontractors are bringing people 
in from other facilities, other States, who have clearance when 
our region has incredibly high unemployment. This has been a 
problem that has plagued us since the 10 years that I have been 
in Congress. Sometimes it is less severe, and sometimes it is 
more. I just wanted to bring it to your attention. I realize 
that this kind of problem probably is not the most appropriate 
for the Secretary of Energy, but you are in front of me, and I 
just wanted to express that concern to you in case you could 
help us cut through that roadblock. It is--it ought to be a 
solvable problem, but it just seems to be a continuing 
frustration for the people in my region.
    And the second issue I wanted to bring to your attention is 
you mentioned the Portsmouth facility, so it is good to know 
that you are aware of it. As you know, it, at one time, was the 
only facility that had the capacity to enrich uranium through 
the entire process for our nuclear fuel needs. It was put in 
cod standby, and the hope is, and it will happen eventually, 
that a new technology, more efficient, competitive technology 
will come on stream. The Inspector General issued an audit 
report raising concerns about the vulnerability of our domestic 
nuclear fuel supply if there is a significant time between the 
emergence of the new technology and the termination of the 
standby capability at the Portsmouth site. As far as I can find 
out, about 80 percent of the fuel that we use in our nuclear 
reactors come from foreign sources. And so this facility has 
been kept on standby in the event there would be an unexpected 
disruption of fuel from foreign sources so that we could, if we 
needed to, begin the processing capacity there at Portsmouth. 
According to the President's budget, cold standby will cease in 
2006, but we really don't expect the United States Enrichment 
Corporation to have a commercial--a new commercial facility 
viable until 2011. And I am puzzled that cold standby would 
cease before we have the capacity to assure ourselves the 
ability to meet our domestic fuel needs if there was a foreign 
interruption. And I would just like for you to speak to that, 
if you would.
    Secretary Bodman. Yes, sir; I would be happy to.
    First, my understanding is that first of all, that the 
termination of the cold standby, in shutting that down, is the 
proposal. That is what has been determined is the best outcome 
in terms of the Department and the government. I can appreciate 
the impact that it has on your constituents, and I am sensitive 
to that. Again, as I said, I am sure I won't be in here again 
saying that, to you and perhaps others, as we go through this 
process.
    Mr. Strickland. If I could just interrupt----
    Secretary Bodman. Sure.
    Mr. Strickland. [continuing] and I hate to do that, but----
    Secretary Bodman. That is all right.
    Mr. Strickland. [continuing] the time is short.
    The--if, in fact, it was in the national security and 
economic security interests of our country to maintain that 
facility on standby until a new production facility is in 
place, what has changed to affect that judgment?
    Secretary Bodman. I don't believe that the judgment of the 
Department has changed. I haven't seen the IG report to which 
you referred. I would be happy to look at it.
    Mr. Strickland. Okay.
    Secretary Bodman. But I have not seen that. And I believe 
that this has been part of a program that has been in place. 
And these are tough times. As we are going through not only the 
shutdown of facilities that were very useful 40 years ago, 50 
years ago as we were getting this industry up and going, but as 
we are now in the process of cleaning up some of the many old 
facilities that we have, Rocky Flats is one, for example. We 
are going to go through and exercise there where people who 
were working there won't have jobs, because there will be 
nothing done there. So we are in the business right now of 
dealing with shutting down old facilities. And that is part of 
the challenge of this task, I will tell you.
    And so I don't think the position of this Department has 
changed, and I would be happy to look at the Inspector 
General's report.
    Mr. Strickland. Thank you. Thank you for your patience.
    Mr. Shimkus. The gentleman's time has expired.
    And now the Chair, recognizing myself for 5 minutes.
    So Mr. Bodman, it is great to have you here, and----
    Secretary Bodman. Yes, sir.
    Mr. Shimkus. [continuing] you have got great credentials. 
And your clarity and your effort I think is--I think members 
are really going to enjoy. And thank you for your patience for 
sitting through here. I am going to go through some things 
really quick, and then the last two will be questions that you 
may not have the answers to and I would like to get written 
comments back.
    First of all, I have to echo everything on Yucca Mountain 
that has been said. Illinois is a high nuclear state. We have 
got high-level nuclear waste in downtown Chicago and the 
suburbs that need to move--and that really needs to be moved. 
So it will be our focus, after the scare we had last year, of 
the funding debate, which at least we have got some in the 
budget.
    My colleague, Mr. Green, talked about the efficient 
dispatch critical component. We tried to do some--a little of 
that in the last energy bill on the economic dispatch. So I am 
in line with him on that issue.
    The President's budget has $18 million in FutureGen. You 
brought that up. I talked to you about it yesterday, which I am 
just going to echo that. But I think what many of us are 
looking for is, as--my first question, which is do you have a 
time when you think there might be site selection on FutureGen? 
Although we are moving forward and we have had some funding 
issues, we--many of us who are watching this are in the dark as 
to what is the timeline, what is the process, when will 
decisions be made.
    Secretary Bodman. I don't have an answer, sir.
    Mr. Shimkus. Okay.
    Secretary Bodman. I would be happy----
    Mr. Shimkus. Great.
    Secretary Bodman. [continuing] to get you an answer.
    [The following was received for the record:]

    The competitive solicitation for the site selection will be 
issued approximately three months after the FutureGen 
cooperative agreement with our industry partners is signed. We 
anticipate that site selection will be a fair and open 
competitive process that would evaluate each of the proposed 
sites on its merits against a set of technical and 
environmental (National Environmental Policy Act-NEPA) 
criteria.

    Mr. Shimkus. I appreciate that.
    The next question is on the Energy Department's vision for 
high-energy physics research. This is one you will probably 
have to get back with me on, also. The question is what can we 
do to maintain our position as a world leader in high-energy 
research. And that is an Illinois issue that has a lot of the 
members of the delegation interested in. And----
    Secretary Bodman. That one I can speak to. I would be happy 
to try to speak to it.
    Mr. Shimkus. Please do.
    Secretary Bodman. I just would start by going back to where 
I started from in the beginning. These are very tough budget 
times, and the Office of Science, which oversees all of these 
expenditures, is very well managed, very thoughtfully managed, 
and it has had to make some very tough tradeoffs. For example, 
the BTEV and Fairmy, it is our recommendation, on behalf of the 
President, that that not be funded, that that be terminated, 
and that we take advantage of a relatively new facility that is 
in Europe. That means that we, America, will lose because some 
of our good people will go over there, because people in this 
business tend to move to where the facilities are and that we 
will then leapfrog that by making investments in newer 
approaches.
    So these are very hard decisions that have to be made. They 
affect things that are very dear to my heart. Faculty, 
students, graduate students, all of that, it is very tough. And 
all I can tell you is that some very thoughtful people who care 
a lot about this field have looked at the choices and have made 
them, and I think they have done a responsible job.
    Mr. Shimkus. And we understand the challenges. I would 
just--you know, there will be a rebuttal by the legislative 
branch on these proposals, and I would just be prepared for 
that.
    The last one, real quickly, deals with--you have expressed 
your support for coal, clean coal technology incentives. We 
have a concern that--and you have an experience with the 
Treasury Department, so you might need to get back, but we 
understand that the Treasury Department's revenue proposals 
released this week the tax incentives that would give 
confidence to clean coal technology research are not listed 
there. So it is connecting the dots. If there is a concern that 
if the treasury is not saying that research and development 
clean coal technology is there, then on the public policy side 
and the authorization side, it sends a wrong signal. So if you 
could maybe close the loop and get an answer as to whether we 
are fully committed and if the whole Federal Government 
agencies are behind this, that would be helpful.
    Secretary Bodman. I know a lot about the treasury budget, 
but I have to tell you I am embarrassed that I have no clue 
what that is. I will----
    Mr. Shimkus. All right.
    Secretary Bodman. [continuing] be happy to get back to you.
    [The following was received for the record:]

    You are referring to a report issued by Treasury on 
February 7, 2005, titled, General Explanations of the 
Administration's Fiscal Year 2006 Revenue Proposals, and 
commonly referred to as ``the Blue Book'', because of the color 
of its cover. The Blue Book identifies all major initiatives 
supported by the Administration that will impact revenues to 
the U.S. Treasury. These include tax cuts, tax incentives, 
closing of tax loopholes, certain excise taxes, and other 
revenue-related measures. The 2006 Blue Book identifies several 
energy-related incentives, including extensions of tax 
incentives for renewable energy technologies, special tax 
treatment for nuclear power plant decommissioning funds, tax 
credits for certain hybrid and fuel cell vehicles, and tax 
credits for energy efficient combined heat and power property. 
The Blue Book does not include any measure to provide 
incentives for clean coal technologies.
    The absence of incentives for clean coal technologies from 
the Blue Book is largely a reflection of the fact that the 
Administration has not completed its deliberation regarding the 
most appropriate target, form, and amount of incentives for 
clean coal technology. As you may know, the 108th Congress 
considered a number of bills including incentives for clean 
coal technologies. Approaches introduced in the bills included 
investment tax credits, production tax credits, direct 
subsidies, federal loans and loan guarantees. Targets included 
existing coal-fired power plants, new coal-fired power plants 
employing multiple designs, and emerging air pollution control 
technology. But at the end of the day, nothing was enacted into 
law, and no funds were appropriated beyond the traditional R&D 
and demonstration programs already in existence. I believe this 
failure was due to the breath of the incentives proposed and 
our current budget deficit environment, an environment where 
many worthy federal concepts are simply unaffordable.
    I support the concept of using federal financial incentives 
to compliment our R&D and demonstration programs, and to 
accelerate commercial acceptance of advanced coal technologies. 
But the Administration has not yet identified the specifics of 
an appropriate program for clean coal incentives, and made the 
tough choices balancing what is needed against what is 
affordable. I appreciate your support on this issue, and look 
forward to working with this Committee on clean coal 
incentives.

    Mr. Shimkus. Great. Thank you. And my time has expired.
    The Chair now recognizes the gentlewoman from California 
for 6 minutes.
    Ms. Capps. Thank you, Mr. Chairman.
    And I want to say a word to you, to the committee 
leadership, on favor of our--doing a reconsideration of our 
energy bill in regular order. I believe this would be a good 
mark for the new leadership, Mr. Barton, the new chairman, to 
have this come under his watch. And so I want to put on record 
that I am in favor of that. I opposed it, H.R. 6, in its 
original form, but I am an optimist, and I believe that if we 
revisit it with hearings, that there is a chance to improve 
this bill. And I also believe that, given the failure of its 
passage in the Senate and the passage of time since then, we 
owe it to ourselves and to the American people to bring it up 
to date to consider what has happened since we first introduced 
that. And I am saying that to you, too, and I believe, Mr. 
Secretary, that it would be a good reflection for your 
leadership to have this revisited in a thorough way on your 
watch.
    And I want to welcome you here.
    Secretary Bodman. Thank you.
    Ms. Capps. It is a long process to come and visit the 
committee, but you have made yourself available and listened 
carefully. And congratulations on your appointment.
    Secretary Bodman. Thank you.
    Ms. Capps. As you know, the leadership is not--is pushing 
quickly to have this bill from 2003 introduced and passed 
quickly. And the conference--some of the people pushing the 
conference report on H.R. 6 seem to believe that it would be an 
answer to these gas prices, which are, again, creeping up. This 
is a view that has been espoused by the White House Press 
Secretary Scott McAllen, the Energy Deputy Secretary Kyle 
McSlarrow, and many members of this committee as well.
    For those of us who worked on the energy bill, it seems to 
be a rather baffling position, and this thought was brought up 
by our mutual Massachusetts friend, Mr. Markey, that the 
Department's own Energy Information Administration published an 
analysis of the energy bill, which Mr. Markey eluded to in 
February 2004 and I have a copy of the statement, which says 
that the Republican conference report on H.R. 6, the Energy 
Bill, would actually increase gas prices, not reduce them. And 
this increase would be between 3 and 7.5 cents per gallon. In 
California, where I am from, the prices could increase as much 
as 8 cents a gallon.
    And I want now to get a comment from you on this EIA 
analysis, and you know, what--how you tie it to the energy bill 
and what we should be doing about it today.
    Secretary Bodman. Well, thank you for your good wishes, 
first of all.
    Second, I think the reconciliation of these apparently 
conflicting views is probably best done by thinking of 
timeframes. I mean, the high energy prices that we have been 
dealing with in our country today have been a very long time in 
the making. And they are going to be a very long time before 
they are dealt with. And I do not see, if we were to pass this 
energy bill tomorrow, literally, and the President signed it 
tomorrow, that it is going to have any short-term impact on 
gasoline prices that is meaningful. I think that we are looking 
over--this in order to deal with energy prices, in order to 
deal with the issues, it requires a very balanced approach, in 
my view, of looking at all potential sources of additional 
energy, be it nuclear, be it coal, be it hydrogen, and invest 
in new technologies in those areas, that we make every effort, 
also, to improve the efficiency of the way we use energy today, 
hence the effort in trying to improve gasoline mileage, which 
has been a part of what this administration has done and has 
been active in doing, as well as looking at improved appliance 
efficiencies and so forth. So it requires a balanced effort 
across the board, not just ANWR, not just----
    Ms. Capps. Right.
    Secretary Bodman. [continuing] nuclear, but everything in 
order to deal with this. And it is going to take years to deal 
with all of these efforts in order to----
    Ms. Capps. Right.
    Secretary Bodman. [continuing] that will bring us around.
    Ms. Capps. But it--then I want a little bit of clarity. Do 
you disagree or agree with the EIA's assessment?
    Secretary Bodman. I haven't read the EIA report, so I can't 
agree or disagree with it. I can just say that I agree that if 
they are talking short-term, is this going to have an impact on 
fuel prices, the answer is I don't believe that it will have a 
meaningful impact on fuel prices short term.
    Ms. Capps. Well, thank you for that.
    Secretary Bodman. It is going to take a long time to solve 
this problem.
    Ms. Capps. I do have a suggestion for you, and, actually, a 
request----
    Secretary Bodman. Sure.
    Ms. Capps. [continuing] that would affect gasoline prices 
in my State of California, and I actually hope that on your 
travels around looking at energy needs around the country, that 
you will come and visit. My District is the 23rd, and I would 
love to welcome you.
    Last year, the EPA provided relief to both New Hampshire 
and Arizona from the Clean Air Act's oxygenate requirements. 
This is an important step that provides these States with 
flexibility that could reduce gas costs for consumers. However, 
EPA has yet to act, despite many requests from me and other 
people, on California's request for similar relief. And last 
January, Governor Schwarzenegger wrote to EPA, and this is what 
he said: ``Simply put, the Clean Air Act oxygen mandate slows 
environmental improvement, raises costs, and is no longer 
required to ensure substantial and sustained ethanol use in 
California.'' And I would like to take this moment to ask you--
for your assurance that you will revisit this issue and bring 
this matter up with the President. There are a lot of drivers 
and motorists in California suffering due to a delay and 
neglect, we consider it, and it could change if the President 
chose and could do that, with your urging, to focus upon it and 
create this waiver for California.
    Secretary Bodman. I can't speak to that, ma'am. I don't 
know the background that----
    Ms. Capps. I will get you the information.
    Secretary Bodman. If it is an EPA matter, I would be happy 
to get the information and try to be responsive to you. If it 
is something the EPA is supposed to do and they have done it 
for other States----
    Ms. Capps. They have.
    Secretary Bodman. [continuing] why they have not acted in 
your particular case, I can't respond. I simply don't know.
    Ms. Capps. We could use some help.
    Thank you very much.
    Secretary Bodman. You are welcome.
    Chairman Barton. The gentlelady's time has expired.
    The gentleman from New Hampshire, Mr. Bass, is recognized 
for 5 minutes.
    Mr. Bass. Thank you, Mr. Chairman.
    I didn't have an opening statement. Do I get 6----
    Chairman Barton. Well, then you get 6 minutes.
    Mr. Bass. Thank you very much.
    Chairman Barton. The gentleman is recognized for 6 minutes.
    Mr. Bass. And Secretary Bodman, congratulations, I think. 
You are going to walk out of this room displaying all of the 
characteristics of a gumby doll. The reason for that is that, 
as you obviously have figured out in the short period you have 
been there, energy is not about Republicans or Democrats or 
Liberals and Conservatives. It is about regions of the country 
and fairness and equity and competition and so forth. And, you 
know, electricity prices in New Hampshire are probably double 
what they are in some of the Midwestern and Western States, 
because we get no subsidies. We don't have PMAs or anything 
like that. New Hampshire is 48th or 49th in the Nation per 
capita receipts from the Federal Government versus what is 
contributed. New Hampshire is an electricity exporter, and yet 
the only reward they get for that are tons of mercury and 
arsenic that are sent to us by the coal-burning electricity 
generation facilities in the Midwest.
    Nonetheless, I am cheerfully hopeful that we get a good 
energy bill passed in Congress. And I would like to mention 
that there is--there are Northeastern issues that need to be 
addressed in general, most notably the development--the 
meaningful development of renewable energy resources from 
biomass, wind, solar. This isn't the early 1970's anymore. 
Technologies are defined, they work, and we have enormous 
resources that could potentially be tapped if we had a bill 
that balanced all of the various resources, oil, gas, coal, 
alcohol, and so forth with these other things. So we are--so 
this is a work in progress.
    In that respect, I know you worked in the Commerce 
Department, Mr. Secretary, and you are appreciative of the 
economic growth that renewables and the renewable industry has 
seen, and I would hope--or could you agree that support for 
this kind of growth in the form of some form of, and I am 
asking you for specific, and don't expect an immediate answer, 
of consumer credits for systems and appliances and so forth 
would lead to greater energy independence. In other words, the 
development of renewables as an alternative through appliances 
and so forth, boilers, and so on, would create a more reliable 
grid because of the distributed nature of energy--of renewable 
energy resources and would create a significant economic 
opportunity in new jobs and so forth in areas such as mine.
    Secretary Bodman. I certainly believe that this Department 
has supported the development of renewable energy, has been 
very active in it. And I am very enthusiastic about that. And I 
do think that that will help mitigate the impact of foreign oil 
sources on our country. I think that we need to also look, in a 
very broad way, at all of the sources of energy and what are we 
likely to be able to do in the biomass area or in the wind 
area. How much is reasonable that we think that could be 
contributed to the energy portfolio of this country? And I 
think that when one looks at what the likelihood is, on a 
national basis, I appreciate that you have got a regional issue 
that you are focusing on, but on a national basis, we are going 
to have to look not only at renewables, which is important, we 
have supported it, and we will continue to support it, but also 
across the board at other potential sources.
    Mr. Bass. But Mr. Secretary, would the--again, I don't 
expect a yes or no answer. But would the Energy Department be 
willing to embark on some sort of analysis of the resource that 
exists in this country in renewables, most notably in biomass: 
corn husker, agricultural waste, biomass, sawdust, wood chips, 
and so forth? I have heard estimates that this resource alone, 
if properly developed, could eliminate entirely, over a period 
of time, our dependence on imported oil. Now I don't really 
think I believe that. All right. But the analysis needs to be 
made, because there are vast biomass resources in this country 
that are being ignored. And do you think it would be 
appropriate for the Department of Energy, firstly, to analyze 
that kind of resource and how much of it exists and where it 
is? And second, to analyze the energy bill to determine--or an 
energy blueprint to determine the relative balance between 
resources that are allocated to the development of traditional 
energy resources versus these renewables?
    Secretary Bodman. Of course.
    Mr. Bass. Okay.
    Secretary Bodman. That is our job.
    Mr. Bass. Fair enough.
    I will yield back, Mr. Chairman.
    Chairman Barton. The gentleman yields back.
    The gentleman from Pennsylvania is recognized for 5 
minutes.
    Mr. Doyle. Thank you, Mr. Chairman.
    Mr. Secretary, welcome.
    Secretary Bodman. Thank you.
    Mr. Doyle. And congratulations, I think. You have been very 
gracious to spend this much time with us. We appreciate it.
    Mr. Secretary, I am one of the Democrats that voted for 
this energy bill. I believe there is probably nothing more 
important to the future of our country than energy 
independence, that it would change our country and it would 
change the world. It would change our foreign policy. We 
wouldn't be spending $1.5 billion a week trying to stabilize 
parts of the country where we worry so much about where the oil 
is. So it is probably--and in my mind, you know, when we talk 
about a mission to Mars, this should be our mission to Mars, 
energy independence. And the good news is, we have the brains 
and the technology that exists right here in our country to be 
energy independent.
    What I am concerned about, as I look at these budgets, I 
don't think we are putting the resources into the research and 
development areas. And what I see happening in the budget, and 
what I want to ask you to take a hard look at, is it seems to 
me, in too many areas, we are robbing Peter to pay Paul. We are 
taking money from technologies that are proven and about to 
come to market and we are shifting those over to some of these 
programs that are yet unproved and undeveloped but that hold 
potential for the future. And we need to do both. We can't 
sacrifice one at the expense of the other. And that is what I 
see going on here in this budget. I understand that we are 
running a deficit. I understand the country is at war. But I 
also understand the President wants to make permanent tax cuts. 
But I can't think of anything more important than doing both of 
these. And I don't think you have the resources in this budget 
to do that.
    Let me give an example of some of my concerns. The Clean 
Coal Power Initiative. Now that is a DOE risk-sharing program, 
and we are--we--companies seeking to commercialize promising 
new technologies, in 2004, we budgeted CCPI at $168 million, 
but then we slashed the funding by over $100 million and down 
to $50 million. And then that same $50 million funding level 
has been requested for 2006. And furthermore, we shifted $237 
million in remaining advanced appropriations from CCPI to 
FutureGen. Now it seems that what is happening here is we are 
picking winners and losers. We are taking clearly proven 
technologies and approaches, and we are threatening them by 
pushing this money over to a technology that is unproved in the 
FutureGen program. I am not against FutureGen. I mean, I think 
we should fund FutureGen, but not at the expense of these other 
technologies that are so close to helping us bridge the gap, 
the technological gap, that are short-term solutions that are 
going to get us where we want to get long-term.
    And the question I have for you is, is DOE picking winners 
and losers? Have you decided that FutureGen's approach of 
combining integrated gasification combined cycles, along with 
carbon sequestration technologies, has that been picked as the 
winning clean coal technology for future electricity 
generation? And my question is, if it is, can that technology 
work for all major types of coal, bituminous and lignite? And 
how soon might we get these technologies commercialized? When 
will they meet EPA targets? And how much is it going to cost, 
if we are picking this as the winner and pushing aside this 
CCPI initiative?
    Secretary Bodman. Well, first of all, the goal is not to 
push the CCPI initiative aside. The FutureGen is one of the 
approaches to trying to bring about a process that would enable 
us to use coal. CCPI has been an active program. We expect it 
to continue to be an active program. And so to characterize the 
Department as ``picking winners and losers'' and that one is 
down and the other is up, to some degree, it may appear to be 
that, but we also try to fund these until it is demonstrated. 
Do we have interest from industry? Do we get response from 
industry? At some point in time, one has to be in a position to 
make a judgment and get feedback from the private sector as to 
what they think because these are not things that we can 
continue to fund indefinitely.
    Mr. Doyle. Mr. Secretary, let--you know, just going down 
that line of logic----
    Secretary Bodman. Right.
    Mr. Doyle. [continuing] you look at FutureGen and I would 
describe FutureGen has received the mixed and skeptical 
response from the same industries who are going to have to 
become active partners if this program is ever going to have a 
chance----
    Secretary Bodman. That is right.
    Mr. Doyle. [continuing] to meet its stated goals.
    So it seems to me that, you know, just as we get some of 
these technologies close to commercialization where they can 
really help us in the short-term and bridge the gap to the 
future, we pull the rug from under them. And I am just 
suggesting to you, let us do both. Let us not do one at the 
expense of the other. And I would like to see you get more 
money in both of these programs, rather than seeing one die at 
the expense of the other.
    I see I am out of time. Thank you, Mr. Chairman.
    Thank you, Mr. Secretary.
    Chairman Barton. The gentleman--the Secretary can answer 
the question or comment on it, if he wishes to, before I go to 
Mr. Pitts.
    Secretary Bodman. It is my view that CCPI is going forward 
in a positive way and I believe that the budget reflects that.
    Chairman Barton. Okay. The Chair would now recognize 
another distinguished gentleman of Pennsylvania, Mr. Pitts.
    Mr. Pitts. Thank you, Mr. Chairman.
    Mr. Secretary, welcome. I have three questions for you.
    The present budget provides for a $3.6 billion tax 
incentive program for fuel cell development, and it notes that 
the cost of fuel is about $200 per kilowatt hour, down from 
$250 3 years ago. But it is still far from the competitive 
price of $50 per kilowatt-hour. My first couple of questions 
is, is this tax incentive program, which will run through 2010, 
enough of an incentive to bring the cost down? Is the 
administration looking at any other initiatives, incentive-
based or otherwise, to speed the development of fuel cells? And 
if so, I would be interested in the positives and negatives of 
these other options. The basic bottom line is, is there more we 
could do.
    My second question is, your budget calls for $84 million 
for fuel cell technologies. That is up from $75 million. Could 
you provide a breakdown, not necessarily now, but in writing to 
us, of how that $84 million would be allocated for this program 
and what you hope to accomplish with this funding, especially 
with the increase of $9 million?
    And finally, the increase in the hydrogen technology 
program includes coal-based hydrogen production research 
funding and nuclear-based hydrogen production research funding. 
Why is there no renewable-based hydrogen production research 
funding?
    If you could respond.
    Secretary Bodman. Well, let me take them in order, sir.
    First, in terms of the fuel cell development, the idea is 
that the tax incentives would be there, at the same time that 
we are continuing to improve the performance in the fuel cell 
area, so that it is both a decrease in price and an increase in 
incentive. And it is hoped that both of those could combine. So 
there conceivably are other things, I guess, that could be 
done, but it was our sense that that was a good first approach 
to doing it.
    Second, I don't have the breakdown of the $84 million of 
how that would be spent on fuel cells. I would be happy to 
provide that to you, sir. That is easily done.
    [The following was received for the record:]

    The following chart illustrates the budget request for the 
key activities within the Department's fuel cell technologies 
program and the Fiscal Year 2006 (FY06) planned accomplishments 
for each area. The two most significant increases support: 
stack component R&D, which focuses on reducing fuel cell costs 
and improving durability; and technology validation, which 
provides the real-world testing and operating data of hydrogen 
fuel cell vehicles to refocus R&D and support a successful 
industry commercialization decisions in 2015.

------------------------------------------------------------------------
                                 FY 2005
        Key Activity            Comparable     FY 2006     What will be
                              Appropriation    Request     accomplished
------------------------------------------------------------------------
Transportation Systems......     7,495,000    7,600,000  Sensors,
                                                          compressors
                                                          and expanders,
                                                          and air
                                                          filtration
                                                          technology for
                                                          fuel cell
                                                          systems will
                                                          be developed.
Distributed Energy Systems..     6,902,000    7,500,000  High-efficiency
                                                          Polymer
                                                          Electrolyte
                                                          Membrane (PEM)
                                                          fuel cell
                                                          power systems
                                                          as alternative
                                                          power sources
                                                          to grid-based
                                                          electricity
                                                          for buildings
                                                          and other
                                                          stationary
                                                          applications
                                                          will be
                                                          developed.
Stack Component R&D.........    32,541,000   34,000,000  The increase of
                                                          $1,459,000
                                                          will support
                                                          research on
                                                          fuel cell
                                                          materials to
                                                          reduce cost
                                                          and increase
                                                          durability as
                                                          recommended by
                                                          the National
                                                          Research
                                                          Council.
                                                          Issues of
                                                          survivability
                                                          and start-up
                                                          time at
                                                          freezing
                                                          temperatures
                                                          will be
                                                          addressed.
                                                          Fuel cell
                                                          component
                                                          diagnostics
                                                          and
                                                          accelerated
                                                          aging tests
                                                          will be
                                                          established to
                                                          improve
                                                          membrane
                                                          durability.
Fuel Processor R&D..........     9,721,000    9,900,000  Fuel processors
                                                          for stationary
                                                          and auxiliary
                                                          power
                                                          applications
                                                          and versatile
                                                          catalysts
                                                          suitable for a
                                                          variety of
                                                          fuel
                                                          processing
                                                          applications
                                                          will be
                                                          developed.
Technology Validation.......    17,750,000   24,000,000  The increase of
                                                          $6,250,000
                                                          will allow the
                                                          program to
                                                          move toward
                                                          full
                                                          implementation
                                                          of this
                                                          National
                                                          Learning
                                                          Demonstration
                                                          which includes
                                                          three
                                                          geographic
                                                          locations with
                                                          different
                                                          climates. This
                                                          activity will
                                                          validate fuel
                                                          cell vehicle
                                                          technologies
                                                          under real
                                                          world
                                                          operating
                                                          conditions,
                                                          measure
                                                          progress
                                                          towards
                                                          targets, and
                                                          help guide
                                                          future R&D.
Technical/Program Management       535,000    6,000,000  This activity
 Support.                                                 supports
                                                          preparation of
                                                          program and
                                                          operating
                                                          plans and
                                                          evaluation and
                                                          review of the
                                                          R&D
                                                          activities.
Total.......................    74,944,000   83,600,000
------------------------------------------------------------------------


    Mr. Pitts. Thank you.
    Secretary Bodman. And then your third, I have forgotten 
your third point. What was it?
    Mr. Pitts. Why is there no renewable-based hydrogen 
production research funding included?
    Secretary Bodman. I don't know how you would do it. No, 
coal and nuclear can be used, and those processes have been 
devised such that good hydrogen can be produced in both. In 
terms of renewable production of hydrogen, I am unfamiliar with 
any process that would be economic, of which I am aware. There 
may be some, but I just don't know what they are, offhand.
    [The following was received for the record:]

    There are several methods of producing hydrogen using renewable 
energy sources. The U.S. Department of Energy is supporting research 
and development of six renewable hydrogen production technologies.

1. Distributed Reforming Using Renewable Liquids
    Renewable liquids such as ethanol and bio-oils can be reformed to 
make hydrogen, enabling a distribution hydrogen system (i.e. at a 
refueling station) and avoiding the need for a hydrogen delivery 
infrastructure. Challenges to making the technology commercially viable 
are: (1) increasing the system's energy by 50%; and (2) reducing the 
cost of reforming. The goal is to reduce the cost of making hydrogen 
from renewable liquids to $2.50 per gasoline gallon equivalent by 2015.

2. Biomass-to-Hydrogen
    Hydrogen can also be produced using heat to breakdown biomass 
solids, e.g., crop or forest residues, plant matter, and organic 
wastes. After gasifying or pyrolyzing the biomass, the resulting 
hydrocarbon and bio-gases are reformed to a synthesis gas mixture from 
which hydrogen needs to be separated and purified. New and advanced 
separation technologies are being researched to reduce cost and 
increase efficiency. Significant cost reductions can be achieved by 
combining hydrogen separation with chemical reaction processes thereby 
eliminating process steps and their associated capital costs. Research 
efforts are underway to develop more separation membranes. Our goal is 
to reduce the cost of hydrogen production and delivery using this 
technology from what is possible currently ($5.00 per gasoline gallon 
energy equivalent) to $2.60 per gasoline gallon equivalent by 2015.

3. Water Electrolysis
    Water electrolysis uses electricity to split water into hydrogen 
and oxygen. Renewable electricity, e.g., from wind power, can be used 
in an electrolysis system to supply some or all of the power. This 
approach has the potential to provide a production pathway with near-
zero greenhouse gas emissions. The capital costs of current 
electrolysis systems, along with the high cost of electricity in many 
regions, limit widespread adoption of electrolysis technology for 
hydrogen production. Capital cost reductions and energy efficiency 
improvements are needed, along with the design of utility-scale systems 
capable of integration with renewable electricity sources which have 
variable and intermittent power. Our goal is to develop technology that 
improves energy efficiency by approximately 19 percent and reduces the 
cost of making hydrogen to $2.75 per gasoline gallon equivalent by 
2015.

4. Solar High Temperature
    Heat from solar concentrators and chemical compounds can also be 
used to split water. Concentrated solar energy can generate 
temperatures of several hundred to over 2,000 degrees Celsius, at which 
point chemical reaction cycles can produce hydrogen from water. These 
multi-step thermochemical cycles offer potentially attractive paths for 
generating hydrogen. Current R&D efforts are focused on understanding 
the underlying mechanisms of the high-temperature reactions and 
optimizing solar thermal reactor designs. An increased understanding of 
the underlying mechanisms and advancements in technology could lead to 
practical direct, high temperature water-splitting using nuclear heat 
as the source.

5. Photoelectrochemical
    Another potential long-term technology to split water uses sunlight 
and semiconductor materials in a monolithic device to produce hydrogen 
directly. The challenge is finding a material that can drive this one-
step process. Research is underway to identify more efficient, lower 
cost materials and systems. Materials and systems now in development 
build on the technology developed by the photovoltaic industry over the 
last 25 years.

6. Photobiological
    Certain photosynthetic microbes, such as green algae and 
cyanobacteria, produce hydrogen from water in their metabolic 
activities using energy from sunlight. In the microbe systems being 
researched, arrays of light-capturing molecules absorb sunlight, 
convert light into chemical energy, and disassociate water to generate 
hydrogen and oxygen. The hydrogen production rate is currently too low 
for commercial viability. Researchers are addressing this issue by 
screening for naturally occurring microorganisms and creating new 
microorganisms that can produce hydrogen at higher rates.

    Mr. Pitts. Okay. Thank you, Mr. Chairman.
    Chairman Barton. I thank the gentleman.
    The gentleman from Maine, Mr. Allen, is recognized. Is it 5 
or 6? Did you waive your opening?
    Mr. Allen. I waived; 6 minutes.
    Chairman Barton. So the gentleman gets 6 minutes.
    Mr. Allen. Thank you, Mr. Chairman.
    Mr. Secretary, welcome. We are----
    Secretary Bodman. Thank you, sir.
    Mr. Allen. [continuing] very glad, on this side of the 
aisle, to have someone from New England.
    Secretary Bodman. Thank you, sir.
    Mr. Allen. The reason the energy bill didn't make it 
through the Senate is that all five New England Senators--New 
England Republican Senators and all seven New England 
Democratic Senators were opposed. And I think 20 of the 22 New 
England Representatives in the House were opposed to the energy 
bill as well. That tells you something, and we hope that you 
can correct or get a better-balanced bill, help us get a 
better-balanced bill. And we know that all of the departments 
in this administration are going through, what they describe 
as, and difficult times.
    And we understand that, but I just wanted to highlight a 
few things to indicate some--the frustration that some of us 
have with the situation, because you know, we know that this 
year alone, $89 billion will go to people earning over $350,000 
a year, the upper 1 percent in this country, as a result of the 
tax cuts passed over the last 4 years. $89 billion dollars, 
probably more than we will spend in Iraq. And it is a vast sum 
of money.
    When we look at your budget, I am not going to hold you 
responsible for a budget when you have been on the job for 7 
days, but your budget increases funding for nuclear weapons by 
$47 million, but it cuts funding for energy conservation 
programs by $21 million. The DOE budget increases funding for 
nuclear energy by 5.2 percent but cuts funding for the other 
science programs by 3.8 percent. The budget increases subsidies 
for oil, gas, and coal by 18.7 percent at a time when energy 
companies are announcing record profits, but it reduces funding 
for the weatherization program by 3.5 percent. And over at HHS, 
they are cutting funding for the LIHEAP program. So the poor 
are getting--losing support to pay higher energy prices. Your 
budget increases funding for your own office by 16.3 percent, 
but it cuts funding for renewable energy and energy efficiency 
programs by 3.9 percent. It is those priorities--it looks, to 
many of us, as if, you know, once again the administration sees 
renewable energy, basic scientific research, and help for the 
poor as wasteful spending and nuclear weapons, nuclear power, 
and oil and coal company subsidies as essential uses of 
taxpayer funds.
    You know, I--that is a comment. I--if you have a----
    Secretary Bodman. Well, I----
    Mr. Allen. [continuing] quick response----
    Secretary Bodman. Well, yes, the quick response would be 
that let us take nuclear. And I think that the efforts on 
nuclear power, given the challenges of the environment, which 
you have eluded to, and given the possibility of producing low-
cost energy, is something we ought to explore. And that is what 
we are trying to do. And we have a, basically, debunked process 
and have been--have not had our universities that, in any way, 
have supported this field. And so, I mean, that is an example. 
Now you have characterized it in one sense. I would 
characterize it in that sense.
    Mr. Allen. I understand. I understand.
    Let me ask you more of a nuclear question, actually----
    Secretary Bodman. Okay.
    Mr. Allen. [continuing] and one that is of great importance 
to me and one where I see something in your budget that is 
encouraging to us in Maine. The Federal Civilian Use Nuclear 
Fuel Disposal programs run by the Office of Civilian 
Radioactive Waste Management, at the site of the 
decommissioning main Yankee plant in Maine, the biggest 
impediment to the reuse of this site, which is a spectacular 
site, is that DOE has not met its contractual obligation to 
remove the spent fuel. In fact, it seems the program continues 
to move further behind schedule. I am concerned that the 
ongoing litigation has affected the Department's ability to 
work with contract holder utilities now managing the spent 
fuel. I have been urging for a long period of time the DOE to 
begin transporting nuclear waste away from decommissioning 
plants. And I see your budget increases the funding for nuclear 
fuel transportation activities by 52.7 percent. We regard this 
as a good thing.
    I would ask you two things. Do you agree it is time to 
reinvigorate the management and focus of this program and try 
to restore confidence in the government's ability to meet its 
contractual obligations here, No. 1.
    Secretary Bodman. Yes.
    Mr. Allen. And--thank you. And No. 2, is the increased 
amount of money for nuclear fuel transportation activities, is 
that--are you going to make a real effort to move us a little 
further down the road? For all of the controversy about Yucca 
Mountain, it doesn't make sense to keep spent fuel rods at a--
scattered all around the country, and I hope we are going to 
move ahead with that program.
    Secretary Bodman. Well, the answer, eventually, is going to 
be at Yucca Mountain. I mean, that is where the focus is. The 
funding for transportation is, in part, a very significant 
effort in beefing up the capability of this Department to move 
these materials around safely. And so we are going to need 
better security. We need better equipment, and so the focus is 
there. So we are getting ready to be able to do this more 
effectively.
    The issue of a particular utility's spent fuel is a 
continuing aggravation that this Department, you know, will 
have to deal with. And we continue to struggle with the legal 
process that we must go through in order to put a place to put 
this material, which we are legally committed to do. So I find 
myself in a vice, you know, on this. And so we are doing our 
best to satisfy everyone. And I have no doubt that we will fail 
in some respects. All I can tell you is that we will be doing 
our best.
    Mr. Allen. I thank you for that. I recognize the 
difficulties of being sued and trying to work with the people 
who are doing the suing.
    Thank you very much.
    Secretary Bodman. Thank you.
    Chairman Barton. The gentleman's time has expired.
    The gentleman from Oregon is recognized for--is it 5 or 6 
minutes? Six minutes?
    Mr. Walden. Six minutes, Mr. Chairman.
    Chairman Barton. Okay. You have got it.
    Mr. Walden. Thank you, Mr. Chairman.
    Mr. Secretary, it is good to see you again. I enjoyed our 
meeting yesterday, and I commend you for your patience today. 
It is a long hearing, and welcome to the committee.
    Secretary Bodman. Thank you.
    Mr. Walden. I want to make a comment at the outset, because 
you took a lot of grief about the administration's position on 
reliability standards and not moving an independent bill. And I 
think it is important for the record to point out that, when my 
friend, and colleague, the ranking member of this committee, 
had an opportunity to offer an energy bill on the floor of the 
House when we considered this bill that we took up in 2003, his 
provisions struck the energy title, but did offer no 
reliability standards. And when we had a motion to recommit, a 
second opportunity to offer reliability standards on the 
electricity grid in this country, he offered an alternative on 
hydro-relicensing instead. And so it--I think there is an issue 
of fairness here about saying when given the opportunity, our 
friends on the other side of the aisle did not offer 
reliability standards. Only this administration and the 
Republicans offered reliability guarantees in our legislation, 
which most of--or many of our colleagues on the other side 
opposed. So I didn't think it was really fair to just leave you 
hanging out there as the new member, perhaps, without that----
    Secretary Bodman. Thank you.
    Mr. Walden. [continuing] history.
    Secretary Bodman. I appreciate your comment.
    Mr. Walden. Now that I have come to your--rushed to your 
aid and your defense, you might imagine----
    Secretary Bodman. Now we are going to even it up.
    Mr. Walden. Yeah, now I have got to even it up.
    I want to just tell you that there have been some ideas 
that have come out from time to time over the years regarding 
power marketing authorities around the country, and obviously, 
representing one in the Northwest, the Bonneville Power 
Administration, you know, as I talked to you yesterday, that I 
have deep concerns about this proposal. Our delegation in the 
Northwest is pretty spirant. You have my colleague, Mr. Inslee, 
on the left. He would not object to that characterization. My 
colleague, Mr. Otter, on the right, he would not object to that 
description. And me somewhere here sitting between them. There 
are seldom things that actually----
    Secretary Bodman. Let me say, only the Northwest seems to 
be still here, other than the chairman.
    Mr. Walden. And we are not leaving until we get this fixed.
    Secretary Bodman. No, I understand.
    Mr. Walden. Seldom there are things that actually pull us 
together where there is no light between our shoulders, and 
this is one of those issues. And with all seriousness, Mr. 
Secretary, the notion that this administration is going to 
propose taking PMAs, wherever they are, in the Northwest, 
Southwest, to full market rates, is a notion that would spread 
economic devastation in our region. We already have the 
second--the highest unemployment rates in the Nation in Oregon 
and Washington. We are not booming out there attracting jobs. 
We are trying to hold on to the ones that we have.
    Mr. Secretary, these dams that are really at the heart of 
the issue here with Bonneville, are not solely to produce 
power. They are multiple purpose. And I think you understand 
that, obviously, given your background. The 1980 Northwest 
Power Act dealt with some of these issues. And when it comes to 
fish credits, it said, you know, really about 73 percent of 
what happens at the dams is power, 27 percent is dealing with 
fish. And yet, I know coming out of the Office in Management of 
Budget, there is an issue about whether these fish credits 
amount to a subsidy. Do you think they amount to a subsidy?
    Secretary Bodman. I have never thought about it, and I 
would not want to make a quick----
    Mr. Walden. Okay.
    Secretary Bodman. [continuing] response, but I don't know. 
I am unaware of the concept of a fish subsidy.
    Mr. Walden. Okay.
    Secretary Bodman. I do know of the importance of fish. I do 
know if what----
    Mr. Walden. Well----
    Secretary Bodman. I mean, in your region, I----
    Mr. Walden. Right.
    Secretary Bodman. Not fish generally, but fish in your 
region, and I understand that, having dealt with that when I 
worked at the Commerce Department. So I am aware of that, but I 
am unaware of the economic----
    Mr. Walden. The issue----
    Secretary Bodman. [continuing] concept of a fish subsidy.
    Mr. Walden. It is alleged--I am trying to tell you it ain't 
so.
    Secretary Bodman. Okay.
    Mr. Walden. And then----
    Secretary Bodman. I understand, but I have never heard 
that.
    Mr. Walden. Well, and the argument that is made against us 
is that we get this fish credit of 27 percent. And the other 
argument is elsewhere in the country, the Fish and Wildlife 
Service takes money out of the treasury to pay for the kinds of 
things that ratepayers pay for in the Northwest when it comes 
to managing for a fish recovery and all. So that is an issue 
that I think is an important one to watch.
    And when you look at the bonding authority, there is 
another part of the administration's proposal that is deeply 
concerning, and that is that we will treat any private entity 
lending that occurs in a leaseback at--against the treasury 
debt that Bonneville is given. As you know, a number of years 
ago, we ran into constraints of bottlenecks in the Northwest in 
the various planes to get power across to where it is needed. 
It is obvious as we see renewable energy coming online, one of 
the biggest challenges I face with all of the wind generation 
that is being built in my District, and it is some 400 
megawatts that are--that is planned and under construction, is 
being able to connect. And so our delegations have worked 
together with the President directly and the administration to 
expand the bonding authority of Bonneville to build out the 
grid so we don't have the bottlenecks.
    And so this proposal that is buried in the budget would 
basically diminish that bonding authority at a time when that 
is the last thing we need for a reliable and sufficient grid in 
the Northwest. So I draw your attention to that one as well. 
You are going to find a fight from some of us on this committee 
in the notion of going to the market-based rates, because we 
think we are paying our fair share, and perhaps more than our 
fair share and reaching back into the 1940's and 1950's to pay 
back bonds at a different interest rate when that issue was 
dealt with in both 1996 and elsewhere. We think it is unfair.
    And so I know you are new to the job, but my job is to help 
provide my little share of education.
    Secretary Bodman. Thank you. I appreciate being educated. 
My position on this is that these proposals are meant to give 
the management of all of these authorities the flexibility to 
run their business and to do it in a fashion that is more 
business-like. That is the goal.
    Mr. Walden. Yeah.
    Secretary Bodman. And there is no doubt that it will 
adversely impact to varying degrees, some, frankly, not very 
much, but I have no doubt other individuals will be affected 
much more. And so I think the $200 a year that was given 
before, I think that is on the high side, from what I know in 
having looked at it.
    Mr. Walden. 20 percent a year is the cap.
    Chairman Barton. The gentleman's time----
    Mr. Walden. Okay.
    Chairman Barton. [continuing] has expired.
    Mr. Walden. Thank you, Mr. Secretary.
    Secretary Bodman. You bet.
    Chairman Barton. Mr. Inslee has been here the entire time. 
Mr. Rush just came in. I am going to recognize Mr. Inslee and 
then Mr. Otter and then let Mr. Rush be the clean-up hitter.
    The gentleman from Washington, Mr. Inslee.
    Mr. Inslee. Thank you, Mr. Chairman. Rare freshman 
privileges. I appreciate that.
    I won't--I can't mince words, Mr. Secretary----
    Chairman Barton. Did you give an opening statement? Do we 
give you 5 minutes?
    Mr. Inslee. I did not. No, I did not.
    Chairman Barton. Were you here and deferred?
    Mr. Inslee. I will let you be the judge of that, Mr. Chair.
    Chairman Barton. He was here. He was here and deferred, so 
you get 6 minutes.
    Mr. Inslee. Thank you, Mr. Chairman.
    Given the gravity of this issue, I really can't mince 
words. Normally, I would like to be friendly and gracious when 
we start----
    Secretary Bodman. No.
    Mr. Inslee. [continuing] but let me just get right to the 
heart of this thing. This budget really does take two very 
damaging shots at the Pacific Northwest economy and 
environment. And Mr. Walden indicated that your efforts to 
stick Washington State ratepayers with a 20-percent rate 
increase is not only unfair, but it is illegal. We have dealt 
with this issue in 1992 when we passed a law that specifically 
made it illegal for the executive branch, I just want to make 
sure I give you right language, to conduct any studies relating 
or leading to the possibility of changing from the currently 
required at-cost to a market rate for BPA power. We dealt with 
this. We made it illegal even for the executives to study this 
issue. We were so adamant in the U.S. Congress. And yet we are 
here. We have the executive telling us that you are studying 
this issue and want to roll out this. You have got to 
understand, this is a 20-percent increase, at least. Your 
documents show $100 energy tax on my consumers who are trying 
to make their mortgage payments and keep their small businesses 
alive. It is $480 million a year in Washington and $2.5 billion 
over 3 years. It is a major economic tsunami for the State of 
Washington. And the reason you notice a little bit of ire in my 
voice is because in the last 2 years, this same administration 
that wants to put this energy tax on my consumers is the one 
that sat there on its hands and let Enron take us to the 
cleaners for $1.5 billion in the West Coast. We are already 
fragile. We have given 2 quarts of blood because this 
administration let Enron do this to us, and now you are back to 
the table with the second low blow.
    So you will note a little vigor here that is going to come 
out, I think, on a bipartisan basis. Now this is a situation we 
have dealt with many times. We pay cost-based. We are not 
subsidized. We don't expect the libraries to make a profit and 
we don't expect the PMAs to make a profit.
    So I guess the question I have for you is, is your effort 
to put this surcharge on the citizens of the State of 
Washington, is that because you want to soak them to pay for 
your fossil fuel subsidies in your budget or you want to soak 
them to protect your tax cuts for people who are over $350,000 
a year? Which is your motivation?
    Secretary Bodman. Thank you, sir, for your comments.
    Excuse me. I am having trouble speaking.
    Mr. Inslee. Take your time, as long as it is off the clock.
    Secretary Bodman. The goal of these proposals, as I said, 
was to put these businesses on a more business-like basis. 
Electric energy that goes to your constituents, goes at a price 
that is viewed as being below market and is being subsidized by 
other taxpayers. And so this is a goal to try to equalize, if 
you will, the economic requirements that are placed on 
different taxpayers and to make it even. That is all there is 
to it.
    Mr. Inslee. I appreciate your answer. Let me just note that 
we pay our cost. That is an economic model. Congress has 
decided on it. And your current studies are illegal, according 
to this law. I hope that you will take a look at that and talk 
to your counsel.
    The second issue, at Hanford, we have a million gallons 
leakage into the Columbia River, some day, potentially. We hope 
that doesn't happen. We are in the midst--we are in the middle 
of an effort to clean up the Hanford nuclear site. And despite 
that fact, you want to cut over $200 million from this budget. 
This is a huge problem. And we are very concerned, because 
while you want to take over $200 million out of the Hanford 
site, for some reason you only take $4 million out of the South 
Carolina site, which is interesting because South Carolina 
knuckled under to your request to leave all of this high-level 
nuclear waste in the tanks in Washington State just by 
reclassifying. Like, if you change ``plutonium'' and you rename 
it ``milk,'' then it is benign. And that is what you wanted us 
to do, and we would not knuckle under to that. Now we find that 
you don't cut the Savannah budget, but you whack the heck of 
about 10 or 12 percent out of the Hanford budget. And then you, 
as Secretary of Energy, I think, and correct me if I am wrong, 
recorded as saying the reason is because of some of these legal 
difficulties or lawsuits or language to that effect. The legal 
difficulties is we simply want you to follow the law, and the 
law is that you remove this scum from these tanks. And you went 
over to the Senate the other day and said you were committed to 
that. Now I guess what I am trying to understand is how can you 
say you are committed to follow the law, then you try to use, 
the kindest language I can find is budgetary blackmail to whack 
our budget when we are simply trying to get you to follow the 
law. I just can't reconcile that. If you could help me, I would 
appreciate it.
    Secretary Bodman. I would be happy to try to help you, sir.
    There are reductions in the budget for Hanford and the 
environmental cleanup of Hanford. I am getting all choked up. 
Excuse me.
    Mr. Inslee. My questions have that----
    Secretary Bodman. It must.
    There are reasons for it. One is, in fact, that we are 
trying to put our money in those areas of cleanup where we have 
the possibility, probability of achieving the maximum success. 
There are legal entanglements that we have in dealing at 
Hanford. You are aware of that. And there has been litigation 
there. We believe we are following the law. I believe I am 
following the law. And I would not state otherwise. And you and 
I apparently have a difference of view.
    There is also a situation with respect to the vitrification 
plant, which is being constructed there, that they have 
recently discovered perhaps it should have occurred before, but 
they at least have identified it now, during the course of 
construction, potential seismic problems of the substructure 
that would support the foundation of this plant are more 
problematic. I think reasonably so, they have slowed down the 
construction of that vitrification plant, as they go through an 
evaluation on a unit by unit basis to make a determination is 
there enough margin for error built into the calculations for 
the foundations that would sustain it, given the changes in 
what they understood to be the seismic conditions. And so 
therefore, we can not spend money at the same rate that we had 
anticipated spending money and--during 2006 on the 
vitrification plant. And that is a meaningful factor in the 
reduction.
    Third, we have actually completed some things that, 
therefore, there was to be overall a peak in 2005 in our 
environmental management account and that, to a degree, the 
fact that we have now moved all of the material from the 
single-wall tanks into double-wall tanks and that we have now 
emptied the basins the KBs, as I think they are called, and 
that all of that material has now been moved further away from 
the river to safer ground. So we now have completed some things 
and, therefore, we don't have to spend the money near-term in 
order to deal with that.
    And so this is not a matter of blackmail. This is a matter 
of trying to make a responsible and reasoned judgment on where 
we can spend money and get results during that fiscal year.
    Chairman Barton. The gentleman's time has expired.
    The gentleman from Idaho, and I believe it is 5 minutes, is 
that not correct?
    Mr. Otter. That is right, Mr. Chairman.
    Chairman Barton. The gentleman is recognized.
    Mr. Otter. Thank you, Mr. Chairman.
    And once again, Mr. Secretary, welcome to the committee. I 
am going to move away from our power problems in the Pacific 
Northwest, because I think my two colleagues that just preceded 
me have pretty well set the tone, but I do want you to know 
that I want to associate myself with not only their questions 
but their frustrations and their hopes that we, perhaps, can 
get some things worked out.
    But I want to, more specifically, talk about the Idaho 
National Laboratory. As you are aware, February 1 we got a new 
contractor. I believe that transition is just going great. The 
community has thrown their arms around that contractor and the 
contractor has done very much the same thing. Good corporate 
citizen. We are very proud of them, and very excited, with 
great expectations about the folks that now have that contract.
    One of the things sort of holding up progress to date and 
now offering some anxiety is when are we going to get the new 
Idaho Cleanup Project contractor in place. At one time, we felt 
like that was going to come simultaneously with the new 
contractor to operate the laboratory. Now we are concerned that 
it has been pushed back. And I would just like to know if you 
can offer us--No. 1, any kind of a certain date that we could 
look to. Is it beyond just March 15? Or No. 2, what is holding 
it up, and how can the Idaho delegation, which is very 
enthusiastic about getting this decision made, how can we help 
you go forward with that?
    Secretary Bodman. Well, we had committed to a March 15 
date, and that is what I expect to be met.
    Mr. Otter. There is no reason to believe that you are going 
to have to go beyond that?
    Secretary Bodman. Not that I am aware of.
    Mr. Otter. Well, that is reassuring. And I appreciate that.
    I also notice in your 2006 budget request, there is very 
healthy increased funding for research and development by the 
administration on the next generation of nuclear plant, which 
of course, we expect to be at the INL. And I believe in your 
Senate confirmation hearing, you expressed a great deal of 
support for that process going forward. Can you sort of explain 
to me the championship that you, yourself, and your Department 
will be able to offer with the administration for going forward 
with this process in proceeding with this new next-generation 
nuclear plant?
    Secretary Bodman. Yeah. First of all, just so the record is 
clear, when I went through confirmation in the Senate, I had 
not yet been through the whole delineation of the 2006 budget. 
Just so that that is clear. I was dealing with my own views and 
what I understood to be the views of the administration.
    What is in the budget is a healthy research program that is 
intended to help the Department reach a conclusion as to what 
process is the best alternative for the next-generation nuclear 
plant. There are alternatives. We have talked to OMB about 
should we be seeking out some, you know, outside view to help 
us make sure that we make a good decision. And so it is hard 
for me to give you any date on this other than we are going to 
be working through 2006 on helping to make a process 
determination.
    I expect to be an energetic advocate, no pun intended, in 
dealing with other members of the administration, including 
OMB, on matters related to basic science and engineering 
processes. And we have got a lot of those. And we are trying to 
put our money in the best possible place, and I will be very 
eager to participate in helping make those judgments.
    Mr. Otter. Thank you, Mr. Secretary. Thank you, Mr. 
Chairman. I yield back.
    Chairman Barton. Thank you, Mr. Otter.
    The gentleman from Chicago, Mr. Rush, is recognized for 5 
minutes.
    Mr. Rush. Thank you, Mr. Chairman, and thank you, Mr. 
Secretary, for----
    Chairman Barton. Is it 5 or 6? I should know.
    Mr. Rush. No, you--Mr. Chairman, you make no mistakes. I 
noted you said 6, so I will just take the 6. Thank you so much.
    Chairman Barton. You have got it.
    Mr. Rush. Mr. Secretary, I know you have been here for 
quite a while, and I am going to be brief with my questions.
    And I really want to readdress an issue that I understand 
you discussed earlier, and that was the LIHEAP budget for this 
fiscal year. As you know, LIHEAP is essential to my area, my 
District, Illinois and Michigan, the cold weather States, and 
also some of the southern States, also. And Chicago, as you 
know, I am not sure if you have had the experience of Chicago 
winter----
    Secretary Bodman. I grew up there, sir.
    Mr. Rush. You grew up in Chicago? Oh, so you know exactly 
what I am talking about. We have got a lot in common.
    The President's budget called for $182 million cut in 
LIHEAP for this fiscal year, and are--we are trying to 
determine where this cut came from, where this amount came 
from. We have been fighting for--since I have been here, to 
increase LIHEAP, and I am really disturbed that we are looking 
at this type of gargantuan cut in LIHEAP. And my--HHS has 
informed my staff that the rationale behind this cut is that 
DOE has advised HHS that the fuel prices will be lower this 
year. And I am trying to--are they passing the buck? I hope 
they are, especially to a fellow Chicagoan. Are they trying to 
pass the buck to you, or did your--did DOE actually report that 
to the President?
    Secretary Bodman. I can't imagine that that would be the 
case, sir. So I don't know what forecasts we did or didn't 
make, but the judgments that were made on this were ones of 
trying to do the best that we could given very difficult budget 
circumstances. I can't say anything more than that, but it was 
not driven by any forecast on this Department's part that 
energy prices were going to be lower.
    Mr. Rush. Well, how will these cuts, these projections, how 
are they going to affect those who--and what kind of remedies 
do you have for those who are dependent upon LIHEAP funds to 
warm themselves in the severe winter cold?
    Secretary Bodman. I don't have an answer for that, sir.
    Mr. Rush. So am I correct in stating that--or in my 
assessment that you are in support of the cuts for LIHEAP for 
this year?
    Secretary Bodman. This administration has tried to make a 
lot of very tough--I think you missed the first part of this, 
sir, and I have been queried at some length about any number of 
cuts that have been made. And a substantial number of cuts have 
been made in a variety of programs. Some have been zeroed out 
in their entirety, and they have been made with the focus on 
the war on terror, the focus on homeland security. That is 
where the emphasis has been. And the balance of our programs 
have dealt with significant reductions. And that is what I am 
dealing with.
    Mr. Rush. Well, how do they reconcile--or is there any 
reconciliation between the--what the bill calls for, it calls 
for $3.4 billion in LIHEAP funding, and this is $1.4 billion 
more than what the President's budget calls for, how do you 
reconcile their differences between the two budgets?
    Secretary Bodman. Well, I can't reconcile anything on 
LIHEAP. This isn't our program. This is the HHS program. And 
you know, whatever they did, they did, but I can not imagine 
that they were doing it because we were forecasting a 50-
percent reduction in energy costs. I would like to know where 
the forecast came from. I don't remember seeing anything even 
remotely related to that that came out of this Department.
    Mr. Rush. Okay. Last, I just wanted to say that, as you are 
aware, I am sure you are keenly aware of this, there are 
literally millions of Americans who, without LIHEAP funding, 
will really just be out in the cold. And I understand the 
demands and the strains and the stresses on the budget and the 
competing interests, but I would like to be comforted by the 
thought that the Secretary of Energy would be a strong, strong, 
very aggressive advocate for the LIHEAP program, because it is 
a program that, clearly, in a lot of instances, the difference 
between life and death for a significant number of the American 
population that--can you assure me that you will be that kind 
of Secretary?
    Secretary Bodman. I can certainly assure you, sir, that I 
would feel a great compassion for those who are dealing with 
cold weather and don't have enough heat. I would certainly tell 
you, sir, that one of my responsibilities is to work hard to 
find a reasonable energy program in this country that can 
remove our dependency on foreign sources of energy, put us in a 
more self-reliant position, and thereby, hopefully, over time, 
reduce our energy costs.
    But it will be very expensive and long-term to accomplish. 
And we are going to work hard at it.
    Mr. Rush. Thank you very much. And thank you, Mr. Chairman, 
for your consideration.
    Chairman Barton. The gentleman's time has expired.
    This is our last questioner, and we have 10 minutes left in 
the vote, so I am going to recognize Mr. Murphy. He has 6 
minutes. I hope he will yield some of it back. And I would 
encourage the Secretary to make his answers shorter, rather 
than longer, and so we can adjourn this hearing and not have to 
come back in 30 minutes.
    The gentleman from Pennsylvania is recognized for 6 
minutes.
    Mr. Murphy. Thank you, Mr. Chairman. I only have two 
questions here, and I recognize that the Secretary has only 
been on the job for 7 days, and yet, if we look at the amount 
of experience you have gained just during this hearing, I think 
you have had a 5-percent increase in learning. And so I can ask 
you the tougher questions here.
    Basically--I mean, I applaud the agency's efforts to cut 
down spending. I think that is a commendable goal, but I am 
really bothered by the cuts in coal research. By my count, in 
the 2006 budget, the request is 80 percent less than the 2005 
budget for this program and 90 percent less for FutureGen 
alone. Natural gas prices have risen to over $6, which is 
decimating our manufacturing and chemical industry of this 
Nation, while coal plants also try and convert to natural gas 
energy. At the same time, the United States has about a 300-
year supply of coal. So the answer to many of our energy 
problems is underneath us. Half of all electricity is produced 
by coal. Pennsylvania, Indiana, and Illinois tie for 23 coal-
fired power plants each. At the time when we need to continue 
to aggressively push for developing methods to burn coal in an 
environmentally sensitive way, I don't understand why the 
Department of Energy is reducing its funding request for the 
Coal Research Initiative drastically and to be cutting things 
that might help us with clean coal technology. And if that is 
not something that you are equipped to answer now, I would be 
happy to have you submit that to the chairman for the future.
    Secretary Bodman. Yeah, I would be happy to get you a more 
complete answer.
    [The following was received for the record:]

    The President's fiscal year funding request for the overall 
coal budget is at $351 million which is the same as the enacted 
level of $351 million for fiscal year 2005. Within that fiscal 
year 2006 budget request the President's request for the coal 
research initiative is $286 million and is up from the enacted 
level of $272.8 million for fiscal year 2005. Within the coal 
research initiative, the budget request for the clean coal 
power initiative is $50 million, roughly the same as the 
enacted level for fiscal year 2005.

    Secretary Bodman. It is my view that we are not reducing 
our efforts in terms of coal and coal technology, and----
    Mr. Murphy. The clean coal technology?
    Secretary Bodman. The clean coal technology. I have no----
    Mr. Murphy. I would appreciate you clarifying that, because 
the way the budget looks, it is--the second thing is in the 
comprehensive energy legislation and the 2006 DOE budget, they 
move the country closer to energy independence in the long run, 
and that is what we need to be doing, but according to the EIA, 
natural gas demand will increase 3.3 percent in the next 2 
years while domestic production will only increase 1.1 percent. 
What is the Department of Energy doing in the near term to try 
and address some of these skyrocketing energy costs with 
natural gas?
    Secretary Bodman. Well, first of all, fixing the energy 
prices of this country has taken many years to evolve, and it 
is going to take many years to resolve. So that is the first 
thing.
    The second thing, and I think the thing that has the 
greatest likelihood in terms of natural gas, specifically, 
which is what I think you asked about, is the effort on clear 
skies. And the effort on clear skies is to basically set the 
ground rules such that over a period of 15 years, or 13 years 
from now until 2018, that we could find a way of setting a 
standard for the removal of NOX, SOX, and 
mercury from coal and that then the people operating these 
companies would know what the problems are and what the rules 
are. And therefore this, I think, should stimulate increased 
use of coal and I think would be helpful in removing the 
pressure on natural gas, which is now the choice of those who 
are building the plants.
    Mr. Murphy. I agree with that goal, and I look forward to 
us working together to make that happen.
    And Mr. Chairman, with that, I yield back the balance of my 
time.
    Chairman Barton. Thank you.
    The gentleman yields back the balance of his time. The 
Chair will keep the record open for a number of days for those 
members that wish to submit questions for the record to the 
Secretary. And the Chair would indicate that members that wish 
to do that have to submit the questions to the chairman so we 
can submit them to the Secretary.
    Mr. Secretary, we appreciate your time. We appreciate your 
willingness to come before us on such an early date as part of 
your secretary-ship. And we look forward to working with you. 
We will have a hearing tomorrow. Chairman Hall's subcommittee 
will hold the first of 2 days of hearings on the Energy Policy 
Act of 2005.
    And this hearing is adjourned.
    [Whereupon, at 5:02 p.m., the committee was adjourned.]
    [Additional material submitted for the record follows:]

            Response for the Record by Hon. Samuel W. Bodman
                questions from representative whitfield

Uranium
    Section 630 of Chairman Barton's discussion draft allows the 
Federal government to sell or transfer uranium in any form to third 
parties. I am concerned this could include enriched uranium, which 
would have an adverse impact on the domestic uranium market. Also these 
sales or transfers appear to be exempt from the requirement that a 
determination must first be made that it would not have an adverse 
impact on the market. This would have an impact on the current domestic 
market, and on the funding for future enrichment technology.
    Q1. What thought was given to the impact of these sales on the U.S. 
enrichment industry?
    A1. The Department has not seen a report or justification on the 
aforementioned discussion draft and therefore is unable to comment on 
the rationale used to create it.
    Q2. Why is there no requirement or a secretarial determination of 
no adverse market consequences in every case before the government 
makes such sales?
    A2. Under current law, the Secretary must make a determination of 
no material adverse impact on sales of the Department's surplus uranium 
inventories unless specifically exempted. Because the Department has 
not seen a report or justification on the aforementioned discussion 
draft we are unable to comment on the rationale used to create it.
    Q3. An easy way to correct this flaw is to limit the transfers to 
natural uranium. Is that feasible?
    A3. Having not seen a report or justification on the aforementioned 
discussion draft, we are unable to comment on its strengths and/or 
weaknesses. However, the Department will continue to work closely with 
Congress and industry on the transfer or sales of the DOE's surplus 
uranium inventories to avoid or mitigate impacts to the Nation's 
commercial nuclear fuel industries.

                  QUESTIONS FROM REPRESENTATIVE WAXMAN

    Q1. During your testimony, you cited your recent appointment and 
declined to take a position on whether you agreed with the Energy 
Information Administration's (EIA) analysis on the H.R. 6 conference 
report.1 Please answer the following questions:
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    \1\ http://www.eia.doe.gov/oiaf/servicerpt/pceb/index.html
---------------------------------------------------------------------------
a) EIA projects a constantly increasing need for imported oil for as 
        long as it projects into the future (2025). Do you dispute this 
        projected trend? If so, please provide the analytic basis for 
        your position.
b) EIA projects that if the H.R. 6 conference report were to be enacted 
        ``on a fuel-specific basis, change to production, consumption, 
        imports and prices are negligible.'' Do you dispute this 
        projection? If so, please provide the analytic basis for your 
        position.
c) EIA found that ``there were no significant impacts on future sales 
        of hybrid or fuel cell vehicles'' if the energy bill were to be 
        enacted. Do you dispute this finding? If so, please provide the 
        analytic basis for your position.
    A1a. EIA has long projected rising oil imports as the United States 
is a mature oil province. U.S. oil production peaked in 1970 and has 
generally declined since then, while U.S. demand for petroleum products 
has risen fairly steadily since 1983. From the early days of 2001, this 
Administration has worked to offset the rise in oil imports in the 
short, medium and long term. In the short run, the Administration has 
taken action to increase domestic production and improve energy 
efficiency. For example, President Bush issued Executive Order 13212 on 
May 18, 2001, directing Federal agencies to take appropriate actions, 
to the extent consistent with applicable law, to expedite projects that 
will increase the production, transmission, or conservation of energy. 
In the medium term, the Administration has consistently and vigorously 
pressed the Congress to allow for the exploration and development of 
domestic resources within the Arctic National Wildlife Refuge. The 
volume of oil projected to be there could directly offset an equal 
amount of America's foreign oil imports. And in the longer term the 
Administration's Hydrogen Fuel Initiative has the potential to 
dramatically reduce our future need for oil. Hydrogen and fuel cells 
have the potential to solve several major challenges facing America 
today: dependence on petroleum imports, poor air quality, and 
greenhouse gas emissions. President Bush released his proposed federal 
budget for fiscal year 2006 on February 7th, and despite tight 
constraints on discretionary spending, the budget includes $260 million 
for the Hydrogen Fuel Initiative, an increase of $35 million over 2005 
funding levels.
    A1b. We do not dispute EIA's analysis of the H.R. 6 legislation. 
However, I would like to add that not all of the President's National 
Energy Policy (NEP) recommendations were included in last years' H.R. 6 
conference report and therefore not included in the EIA analysis. 
Unfortunately, some NEP recommendations, such as opening a small 
portion of Alaska's coastal plain to environmentally responsible oil 
and gas exploration and development, were not part of the H.R. 6 
conference report although we commend the House for including those 
provisions in the version of H.R. 6 that it passed in 2003. Foregoing 
environmentally responsible development of our nation's resources 
hampers our ability to develop America's domestic energy resources, and 
will only contribute to our continued reliance on insecure foreign 
sources of energy.
    The Administration believes that the passage of energy legislation, 
coupled with the implementation of the recommendations of the NEP by 
the Executive Branch, will provide balanced long-term measures to 
address the domestic energy situation. We are pleased that many NEP 
recommendations requiring Congressional action are likely to be 
included in energy legislation currently being written in Congress. For 
instance, provisions promoting greater energy efficiency and increased 
emphasis on energy technologies are in the NEP and should be part of 
any energy bill. Implementation of such approaches would help make 
transportation fuels more affordable.
    A1c. The EIA analysis on the H.R. 6 conference report did not show 
any significant impacts on the sales of hybrid or fuel cell vehicles 
and we do not dispute this finding. The H.R. 6 conference report in the 
108th Congress included tax incentives for advanced technology 
vehicles, but, according to the EIA analysis, it appears these 
incentives would not spur increased sales of hybrid vehicles. The tax 
provisions would limit credits to 80,000 vehicles per manufacturer. It 
appears that EIA estimated that consumer demand as well as state 
requirements or incentives (e.g. California Zero Emission Vehicle 
program, Virginia's rule allowing single occupant hybrids to use HOV 
lanes and others) are likely to cause sales in excess of these 
manufacturer limits. We look forward to working with Congress to ensure 
that any energy efficient vehicle technology tax incentives are 
effective in increasing market penetration to help reduce petroleum 
demand and oil imports.
    Q2. Texas energy investor T. Boone Pickens recently said the 
following in an interview with Forbes:
        ``I will say this. We'll come out of Iraq with a call on that 
        oil in some fashion or another. And we should. For what we paid 
        in Iraq we should get a call on it. But I don't know who would 
        contest that . . . We're entitled to come out of there with a 
        call on that oil.''
    Please provide the Administration's position on this issue. Is it 
the Administration's position that we are ``entitled'' to a call on 
Iraqi oil?
    A2. Iraq is now a sovereign nation, and it is for the Iraqis to 
determine the framework for their commercial interaction with other 
nations; the United States fully respects that sovereignty, and 
welcomes the people of Iraq into the global economy.

                  QUESTIONS FROM REPRESENTATIVE MARKEY

Energy Independence
    Q1. On February 8, the President delivered a speech in Detroit in 
which he said, ``For the sake of the economy, and for the sake of 
national security, Congress needs to pass an energy plan and get it to 
my desk as soon as possible, so we can become less reliant on foreign 
sources of energy.'' But an analysis of the 2003 H.R. 6 energy bill 
conference report by your Department's Energy Information 
Administration has concluded last year that enactment of the bill the 
President was talking about would have a ``negligible'' impact on 
energy imports, and that under this bill America's dependence on 
imported oil would actually increase by 85% between now and 2025. In 
testimony before this Committee last year, your predecessor, Secretary 
Abraham, said, ``I do not dispute the EIA analyses.'' Do you agree with 
the Energy Information Administration that enactment of the H.R. 6 
conference report would increase oil imports by 85%, and that the bill 
would have a ``negligible'' impact on energy imports?
a) If you agree, don't we need to go back and fix this bill so that it 
        actually reduces our dependence on imported oil by making 
        American cars and SUV's more energy efficient--since two-thirds 
        of the oil we consume goes into gasoline tanks?
b) If you disagree, tell me what EIA and Secretary Abraham got wrong in 
        their analysis of the impact of this bill on oil dependency?
c) According to your agency's Energy Information Administration, in 
        2025, about the time the Arctic Refuge would be peaking in 
        production, we would be 66% dependent on foreign oil. You also 
        claim that drilling in the Arctic would increase domestic oil 
        production by 20%. But isn't it true that in 2002, imported oil 
        represented only 53% of our petroleum consumption. So, even 
        with drilling in the Arctic Refuge--as you recommend--we would 
        still be even more dependent on imported oil than we are 
        today--isn't that right?
    A1. a, b) The National Energy Policy recommended that the 
Department of Transportation (DOT) review and make recommendations to 
increase efficiency through Corporate Average Fuel Economy (CAFE) 
standards, based on sound science.
    In 2003 DOT promulgated a rulemaking to increase light truck fuel 
economy; these were the first changes in fuel economy standards in many 
years, and included significant increases in the light truck standard. 
We believe this is a good first step in addressing our Nation's 
increasing demand for oil. But this is not the Administration's only 
near term action to address petroleum consumption. DOT will soon make a 
rulemaking decision on possible reforms to the CAFE system that could 
facilitate further improvements in fuel economy without compromising 
safety or jobs. Additionally, DOT will issue new light truck standards 
for Model Year 2008 and possibly beyond by April of 2006.
    In the longer term we believe our FreedomCAR, FutureGen, and 
Hydrogen Fuel initiatives will fundamentally change the way we look at 
transportation, oil use and the environment, by developing an 
integrated system using hydrogen from domestic sources that produces no 
emissions of greenhouse gases or air pollutants.
    c) EIA has long projected rising oil imports as the United States 
is a mature oil province. U.S. oil production peaked in 1970 and has 
generally declined since then, while U.S. demand for petroleum products 
has risen fairly steadily since 1983. From the early days of 2001, this 
Administration has worked to offset the rise in oil imports in the 
short, medium and long term. In the short term, the Administration has 
taken action to increase domestic production and improve energy 
efficiency. For example, President Bush issued Executive Order 13212 on 
May 18, 2001, directing Federal agencies to take appropriate actions, 
to the extent consistent with applicable law, to expedite projects that 
will increase the production, transmission, or conservation of energy. 
In the medium term, the Administration has consistently and vigorously 
pressed the Congress to allow for exploration and development of 
domestic oil resources within the Arctic National Wildlife Refuge. The 
volume of oil thought to be there could directly offset an equal amount 
of America's foreign oil imports. And in the longer term, among other 
things, there is the Administration's Hydrogen Fuel Initiative has the 
potential to dramatically reduce our future need for oil. Hydrogen and 
fuel cells have the potential to solve several major challenges facing 
America today: dependence on petroleum imports, poor air quality, and 
greenhouse gas emissions. President Bush released his proposed federal 
budget for fiscal year 2006 on February 7th, and despite tight 
constraints on discretionary spending, the budget includes $260 million 
for the Hydrogen Fuel Initiative, an increase of $35 million over 2005 
funding levels.
    The Administration believes that the passage of energy legislation, 
coupled with the implementation of the recommendations of the 
President's National Energy Policy (NEP) by the Executive Branch, will 
provide balanced long-term measures to address the domestic energy 
situation. We are pleased that many NEP recommendations requiring 
Congressional action are likely to be included in energy legislation 
currently being written in Congress. For instance, provisions promoting 
greater energy efficiency and increased emphasis on energy technologies 
are in the NEP and should be part of any energy bill. Implementation of 
such approaches would help make transportation fuels more affordable.
    Q2. A January 22, 2005 article in the Washington Post reported that 
the Department of Energy has been up to 13 years late in initiating or 
completing rulemakings on energy efficiency standards for various 
appliances. According to the Post article, between 17 and 22 legally 
mandated DOE efficiency standards are overdue. These standards 
reportedly would, if adopted, save enough electricity to meet the needs 
of 5.6 million typical U.S. households annually beginning in 2030. The 
annual natural gas savings from the furnace standards reportedly would 
be enough to heat 3.8 million typical American homes beginning in 2030. 
In light of those prospective energy savings, why has the Department 
failed to meet these deadlines? What are you going to do to get the 
Department's standards-setting program back on track?
    A2. The delays experienced in the completion of the Department's 
priority efficiency standards rulemakings are of concern to me. They 
have been caused by a number of factors, including the many complex 
analyses required by the governing statutes and DOE's commitment to 
involve stakeholders during all stages of the standards development 
process. I have directed that we accelerate those parts of the 
standards-setting process that are within our control. The Department 
takes its rulemaking responsibilities seriously, and we will work to 
accelerate the standards setting process.

DOE Correspondence
    Q1. On May 11, 2004, then-Deputy Secretary McSlarrow testified in 
front of the Oversight and Investigations Subcommittee. I have yet to 
receive a response to the post-hearing questions I posed to him. When 
can I expect the response to arrive?
    A1. The answers to the questions from the May 11, 2004 hearing are 
being prepared by DOE. We expect to provide them to the Committee by 
the end of June, 2005.

DOE Security
    Q1. One of the initiatives recently announced by DOE was to create 
a disk-free computer environment to protect classified information. The 
Clinton Administration made this very same announcement in 1999. In 
fact, on May 5, 1999, then-Los Alamos lab Director John Browne 
testified at a hearing of the Senate Energy and Natural Resources 
Committee (see http://www.lanl.gov/orgs/pa/News/Browne
Testimony050599.html). In his testimony, he stated that the lab was 
``modifying classified computer systems and procedures to prevent 
unauthorized or inadvertent transfer of information from classified 
computers to unclassified computers by the transfer of information by 
removable media (tapes, disks, etc).''

a) Why wasn't the Clinton Administration initiative ever implemented?
b) Why don't the same factors described in your response to factors 
        that apparently prevented this initiative from being 
        implemented previously apply now?
c) My understanding is that DOE is in the process of developing 
        technology requirements and standards for moving to a disk-free 
        environment. When will this be complete, and how long after 
        that will procurement of the appropriate technologies take 
        place?
    A1. (a) and (b) The Clinton Administration initiative has been 
implemented throughout NNSA to the extent permitted by available 
information technology. Substantial numbers of NNSA classified computer 
systems have been modified to prevent unauthorized use of removable 
media. Unfortunately, the National Laboratories have discovered that 
some of the national security mission activities require very fast 
computing performance and input/output. These mission requirements 
could not be achieved with the information technologies available when 
the Clinton Administration initiative was being implemented.
    Collaboration between the National Laboratories and information 
technology suppliers will be necessary to develop the high performance 
desktop solutions to meet the national security mission requirements 
while preventing unauthorized use of removable media. The current 
initiative will support the development and deployment of high 
performance classified desktops to convert the systems that could not 
be modified during the Clinton Administration initiative.
    A1. (c) On July 21, 2004, the Deputy Secretary of Energy tasked the 
Department CIO as the lead for developing recommendations for resolving 
security problems associated with the inappropriate handling of 
classified removable electronic media (CREM). A ``tiger team'' 
comprised of personnel from the OCIO, NNSA, and the Office of Security 
and Safety Performance Assurance, was formed with the overall objective 
of addressing the option of diskless workstations.
    On January 31, 2004, the Deputy Secretary accepted the 
recommendation of the tiger team and approved the establishment of an 
enterprise-wide CREM task force within the NNSA to be overseen by an 
executive steering committee chaired by the DOE Chief Information 
Officer.
    On March 11, 2005 the Task Force Office was officially stood up. 
Patrick Edgerton from the National Nuclear Security Administration 
(NNSA) assumed responsibility as acting Task Force Manager and Carlos 
Segarra from the DOE Office of the Chief Information Officer (DOE CIO) 
as acting Task Force Deputy Manager. Both managers have extensive 
experience within DOE and excellent records as project managers. The 
task force will reside within the NNSA Office of the Chief Information 
Officer.
    The newly formed task force will have responsibility for managing, 
coordinating and expediting the conversion of the Department's 
classified computing operations to a ``CREM-less'' architecture. It is 
anticipated they will develop a diskless workstation solution for 
Departmental workstations used to process classified data. They will 
define diskless workstation standards and support acceleration of 
conversion to the standards across the Department of Energy (DOE) 
including the National Nuclear Security Administration (NNSA) with the 
objective to reduce or eliminate Classified Removable Electronic Media 
(CREM) to prevent security incidences. The task force will also monitor 
and report on deployment progress. Each DOE agency is responsible for 
the actual deployment of the diskless workstations provided by the DWPO 
within their agency. The completion criteria for the project are that 
the diskless workstations are fully deployed throughout DOE. The 
conversion is to be completed by September 30, 2007.
    Q2. One of the initiatives recently announced by DOE is to shut 
down the Sandia Pulse reactor in the next three years. My understanding 
is that all that is required is to move the fuel from New Mexico to 
Nevada, and the reactor itself is rarely used. Why will this take so 
long?
    A2. The Sandia Pulsed Reactor (SPR) is used to test nuclear weapon 
components before they are certified for use in the stockpile. The 
reactor is operated on a campaign basis that depends on the schedule 
for developing replacement weapon components. A critical programmatic 
need for SPR testing is for the W76-1 Life Extension Program (LEP). The 
SPR will be used to evaluate commercially available electronics that 
are not specifically designed and manufactured to withstand radiation 
environments for potential use in the W76-1 LEP. The alternative is to 
use more costly radiation hardened components.
    The SPR fuel is made of highly enriched uranium (HEU). Consistent 
with our objective of managing special nuclear materials to minimize 
the need for special security provisions, Sandia has disassembled the 
SPR HEU reactor core and placed it in special protected storage until 
the latest possible date to support the W76-1 LEP.
    The current baseline plan calls for reassembly of SPR in June of FY 
2005. This schedule is contingent upon safety documents being developed 
and approved. The experimental plan includes both the W76-1 stockpile 
testing and experiments to demonstrate the performance of the new 
technologies that would eliminate future needs for SPR. On this 
timeline, SPR operations will cease at the end of FY 2006. After a 
required short cool-down period, the reactor material will be returned 
to a secure storage condition. No final decisions regarding the 
ultimate disposition of the irradiated SPR fuel have been made at this 
time.
    For the future, Sandia is developing materials and components for 
nuclear weapons that are less sensitive to neutron damage than those 
available today. If successful, the performance of future replacement 
components that are built with these technologies will be assessed 
without the need for SPR.

DOE Security (Protective Force)
    Q3(a). One of the initiatives recently announced by DOE is a study 
of whether the guard force should be federalized. It has been 3.5 years 
since September 11--why hasn't this matter already been studied?
    A3(a). The question has been studied periodically over the years, 
but never with the perspective of September 11. There was an inevitable 
delay after that terrorist attack while immediate concerns regarding 
the need for heightened security were addressed. In many cases, the 
extreme strain placed upon site protective forces in meeting the 
requirements of heightened security--including dramatic increases in 
protective force overtime, new protective force configurations, and 
immediate demands for hiring and training additional protective force 
members--constrained the analysis, training, and overall management 
assets of site protective forces to focus on those short term issues. 
Also, the dimensions of the threat emerged slowly over the latter part 
of 2001 and early 2002, due to real time demands on the nation's 
intelligence assets.
    Beginning in December 2001 and continuing for some months, DOE 
conducted a number of unconstrained, highly detailed tabletop exercises 
to determine how well sites could protect against larger adversary 
threat groups. DOE sites began to implement security upgrades supported 
by these tabletop exercises as soon as each site's exercise was 
concluded. As the results of these exercises and force-on-force testing 
against enhanced threats became available, the form of the revised DOE 
Design Basis Threat also began to solidify. These early results 
indicated that, in addition to increasing the size of DOE protective 
forces, revisions in equipment, training, and doctrine would also be 
necessary to meet the emerging threats. In the spring of 2003, the 
Office of Independent Oversight and Performance Assurance began an 
overall review of DOE protective forces to determine exactly what 
changes were necessary. Final results of this review were published on 
July 15, 2004. Based on these results, site-specific corrective actions 
are in progress to address noted concerns in the areas of training, 
equipment, and performance testing. The results were also used as a 
basis for the review of the protective force that was conducted as a 
result of the Secretarial Security Initiative announced in May 2004 
(see part b of the answer).
    Q3(b). Please describe the planned study as well as the timeframe 
associated with it. What factors will DOE be considering? With whom 
will DOE be consulting?
    A3(b). In May 2004, DOE called for the transformation of existing 
protective forces into elite units, capable of performing their 
national security missions at a level of effectiveness comparable to 
the nation's elite military units. Since then, the Department has 
identified a set of recommendations that, if enacted, would bring about 
this transformation in quality and performance. These recommendations 
range across every aspect of protective force performance, and include 
revisions to policy, increased physical standards, more rigorous 
training and performance testing, and improved weapons and equipment. 
The recommendations also include a detailed re-examination of the 
organizational basis for these forces, in order to allow for the kind 
of changes in physical performance, age restrictions (and retirement 
options), and related measures that are necessary to sustain ``elite'' 
performance over the long term.
    DOE consulted experienced Federal and contractor protective force 
managers, Federal and contractor safeguards and security directors, 
selected members of DOE protective forces, and appropriate DOD commands 
to inform the final strategy recommendations.
    The initial actions of defining mission requirements and standards 
were completed by August 15, 2004. On January 4, 2005, recommendations 
for an overall strategy to create an elite protective force were 
approved by the Administrator, NNSA and the Director, Office of 
Security and Safety Performance Assurance. Efforts are now in progress 
to implement those actions that could be initiated within the current 
force structure.
    Q4. One of the initiatives announced is a study of whether 
plutonium and highly enriched uranium can be permanently removed from 
Lawrence Livermore National Laboratory (LLNL). Another was a plan to 
remove all the Category I and II nuclear materials from TA-18 at Los 
Alamos because it can't be secured there. It is also my understanding 
that DOE is conducting a survey of all the weapons-usable materials in 
the complex to determine whether some could be consolidated to reduce 
the number of sites at which the materials are located.
    (a) It has been 3.5 years since September 11--why haven't this and 
other special nuclear material consolidation possibilities already been 
studied?
    (b) When will the consolidation assessment be complete? How long 
after that will it take to complete the planned consolidation of 
materials?
    (c) On April 9, 2004, Dr. Everet Beckner of NNSA wrote a document 
that stated that only 50% of the material at TA-18 would be moved 
during an 18-month period. Is that an accurate statement? If not, why 
did he make it?
    (d) Some within DOE have stated that the plutonium and highly 
enriched uranium must remain at LLNL because scientists are using it. 
Couldn't both the material and experimental equipment be transported to 
Nevada and have the scientists travel to Nevada to conduct their 
experiments? If not, why not? How frequently are experiments conducted 
on this material? In a separate Congressional hearing, DOE/NNSA 
Administrator Linton Brooks stated that moving this material would 
``preclude our carrying out our stockpile stewardship assessments, and 
that's because while we can move the material someplace else, we can't 
move the research capabilities and processes that exist at Livermore.'' 
Do you agree with Administrator Brooks' statement? Why or why not?
    A4(a). Special nuclear materials are secure today. Consolidation is 
under continuous study within the Department to determine whether 
materials could be made even more secure. Following September 11, the 
Combating Terrorism Task Force was formed and one topic the Task Force 
addressed was materials consolidation. Several of the recommendations 
from the Task Force were implemented by consolidating materials within 
sites to increase their security. Recognizing that more could be done, 
the former Secretary included materials consolidation as one of the 
2004 Secretarial Initiatives and Management Challenges. As a result of 
that effort, the Nuclear Materials Disposition and Consolidation 
Coordination Committee was established. The Committee has the 
responsibility and authority to perform cross-cutting nuclear materials 
disposition and consolidation planning with an emphasis on increasing 
security for our nuclear material assets while reducing overall 
security costs and identifying paths for disposition, as appropriate.
    In addition to the TA-18 example noted in the question, there are 
other significant examples of materials consolidation. A number of 
projects to close sites were accelerated more quickly than previously 
thought possible. Examples include the Rocky Flats Environmental 
Technology Site, Fernald, K-25, and others. There are a number of other 
facilities that will be de-inventoried soon in preparation for 
decontamination and decommissioning. These include the F canyon at 
Savannah River, Building 3019 at Oak Ridge National Laboratory, the 
100K basins, the Fast Flux Test Facility, and the Plutonium Finishing 
Plant at Hanford.
    The construction of the Highly Enriched Uranium Materials Facility 
at the Y-12 National Security Complex has been initiated. In addition 
to providing enhanced protection for the materials within the HEU 
Materials Facility, completion of this building will allow us to 
perform an extensive on-site consolidation of the HEU stored at Y-12.
    A4(b). The Coordination Committee identified above is responsible 
for developing and implementing a Strategic Plan that will encompass 
both disposition paths and consolidation opportunities. The Strategic 
Plan is anticipated to be completed within six months; however, it 
should be noted that materials consolidation is a dynamic process and 
will be continually reviewed as programmatic needs for nuclear 
materials evolve. There is not a simple answer for the length of time 
required to complete the materials consolidation activities identified 
by the Coordination Committee. Timing will be dependent upon a myriad 
of challenges associated with materials consolidation. Materials 
consolidation requires highly specialized characterization, packaging, 
and transportation for the materials to their final destination. For 
the most part, the same characterization activities, containers, and 
transportation capabilities required for materials consolidation are 
also required for carrying out the Department's defense and naval 
propulsion missions. The Department needs to balance these priorities 
with the available resources. Those are just some of the internal 
challenges. There are also challenges with materials consolidation that 
are external to the Department. However, it is in the best interest of 
the Department to actively pursue materials consolidation opportunities 
and with the necessary infrastructure now in place, I am confident the 
Department will be able to continue making significant accomplishments 
in this area.
    A4(c). The removal of nuclear materials from Technical Area (TA)-18 
at Los Alamos National Laboratory (LANL) is a Secretarial Security 
Initiative. On March 31, 2004, NNSA announced it would accelerate 
movement of TA-18 programmatic nuclear material to the Device Assembly 
Facility (DAF) at the Nevada Test Site. The goal was to move 
approximately 50% of the programmatic nuclear material from TA-18 to 
DAF by March 2006.
    In October 2004, NNSA completed a closure plan for TA-18 that 
projected all sensitive nuclear materials will be out of the facility 
by September 2005. This plan includes both moving material to DAF plus 
moving material into interim storage at LANL's TA-55 in order to meet 
this date. NNSA still maintains an interim goal to have at least 50% of 
the programmatic nuclear materials to DAF by March 2006 with the 
remaining programmatic material shipments completed by September 2007.
    Surplus nuclear material shipments will continue to other sites 
through March 2008. Some of the nuclear materials require additional 
transportation container analyses, processing, or new containers for 
off-site shipment. These nuclear materials will go into secure, interim 
storage at LANL's TA-55 until certified containers are available for 
off-site transport. A small amount of low sensitivity nuclear material 
will remain at TA-18 until the site closes, now planned for the end of 
Fiscal Year 2008.
    A4(d). Lawrence Livermore National Laboratory (LLNL) has a 
plutonium research facility (Building 332) where researchers work daily 
with plutonium to support stockpile stewardship activities. This work 
is essential to surveillance of the existing stockpile and also 
supports the development of technology that will enhance the cost-
effectiveness and environmental compliance of any future pit 
manufacturing facility. The cost to replicate the LLNL facility 
capabilities at the Nevada Test Site would far exceed the benefits of 
such a move and separating researchers from laboratory work would be 
counterproductive.
    Q5. One of the initiatives recently announced by DOE was an 
expedited schedule for constructing the Highly-Enriched Uranium 
Materials Facility at Y-12 at Oak Ridge, Tennessee. The current 
contractor, BWXT, altered its plans to build an underground bermed 
facility covered by earth on 3 of its sides and now wants to build an 
aboveground facility. The DOE Inspector General (IG) concluded in March 
2004 that such a facility would be less secure and more expensive.

(a) Why was the design for this facility changed?
(b) Do you agree or disagree with the DOE IG's conclusion that the new 
        design would be less secure and more expensive? If you agree, 
        than why are you allowing this design to proceed? If you 
        disagree, please explain.
(c) Has BWXT chosen contractors to construct the facility? If so please 
        list them.
    A5(a). NNSA approved replacing the original design because after 
careful and detailed review NNSA concluded that the current design is a 
better value to the government than the original design. The current 
design creates this value through a significantly greater ability to 
adapt to the evolving modern terrorist threat than the original design 
and through lower life cycle costs than the original design.
    A5(b). NNSA agreed with the DOE IG's recommendation to update the 
cost and schedule assumptions and to reevaluate the decision to use the 
current design. The DOE IG agreed with NNSA's intended response to the 
recommendation, advising the Secretary on March 19, 2004, that, ``A 
comprehensive life-cycle review, such as the one management has 
committed to undertake, will provide the data to resolve all questions 
as to the cost-benefit of the current uranium storage facility design, 
specifically in comparison with the original design.'' The NNSA's 
review developed information not available at the time the IG prepared 
its report and drew its conclusions. That new information validates 
NNSA's decision to use the current design.
    A5(c). On August 26, 2004, BWXT Y-12 awarded the construction 
subcontract to Caddell/Blaine Joint Venture, a team of two well-
established firms--Caddell Construction Company, Inc. of Montgomery, 
Alabama and Blaine Construction Corporation of Knoxville, Tennessee.

On Wackenhut Corporation
    Q1. In September 2004, a disastrous force-on-force exercise was 
held at the Oak Ridge National Laboratory. According to press reports, 
a mock attack force began a security drill, only to be confronted by 
armed Wackenhut guards who did not know a drill was taking place. 
Thankfully, no one was shot at--but the outcome could have been a 
tragic one.

(a) How did this mix-up occur?
(b) What actions has DOE taken to ensure that nothing like this occurs 
        again?
(c) The New York Times reported that guards involved in this incident 
        were told they could be fired if they told anyone about it. 
        Would DOE support the dismissal of any personnel who reported 
        serious flaws in a force-on-force exercise?
(d) The New York Times article also reported that even after this 
        disaster, guards at Oak Ridge were found to be using live 
        ammunition when practicing discharging and reloading their 
        weapons even though they were supposed to be using blanks. What 
        has the Department done to address this problem?
(e) There was also a recent failure in a force-on-force test at the 
        Nevada Test Site--a site Wackenhut also guards. Please describe 
        this incident. What corrective actions have been taken to 
        address the deficiencies highlighted by the failure?
    A1(a). The September 2004 incident at Oak Ridge involved an alleged 
``near miss'' during a force-on-force exercise. The on-duty armed 
protective force was alerted to a possible alarm that was thought to 
have occurred in the vicinity of exercise participants. Supervisors on 
the scene immediately determined the alarm to be false and terminated 
the required response. After a comprehensive inquiry into the 
circumstances surrounding this exercise, it was determined that no 
safety violations had occurred and that armed protective force 
personnel never confronted nor made visual contact with the exercise 
``players.'' All personnel were fully aware that an exercise was 
ongoing; however, as a result of the thorough review of these 
allegations, a number of improvements in exercise control and 
communication were implemented.
    A1(b). Although an inquiry team determined that no safety 
violations had occurred, the team did identify and recommend several 
opportunities for improvement due to some confusion with communication 
and control noted by exercise controllers during the exercise. The 
inquiry results were integrated with the efforts of a comprehensive 
Firearms Training Safety Review Team (FTSRT) consisting of 
knowledgeable Federal and contractor officials and subject matter 
experts. The FTSRT concluded that while comprehensive procedures were 
in place to adequately control exercise activities, improvements could 
be made to communication and control during exercises. Actions to 
improve exercise communication and control have been implemented.
    A1(c). The NNSA Y-12 Site Office has not received any reports or 
allegations of employees being threatened as a result of reporting 
incidents. Employees are encouraged to voice their concerns through 
appropriate management channels at all times.
    A1(d). An accidental discharge of a handgun occurred during a 
classroom training exercise at the Oak Ridge Central Training Facility 
on September 21, 2004. The training was designed to use inert 
ammunition for weapons manipulation practice. During the course of the 
training, a live round was unknowingly introduced into a handgun and 
subsequently discharged. There was some property damage associated with 
this incident; however, there were no personnel injuries. All firearms 
training was immediately suspended until the conditions that led to the 
accident could be determined and measures implemented to prevent 
recurrence. The root causes were identified as inadequate 
administrative control of the inert ammunition, and inattention to 
detail by the individual who loaded the weapon. Wackenhut management 
directed a process and safety review of all firearms-related training 
involving live-fire, blank, and inert ammunition. A series of 
corrective actions and process improvements were developed to preclude 
recurrence, including enhanced control, accountability and storage of 
inert rounds; distinctive color-coding of ``dummy'' weapons and 
ammunition; and improved briefings for the students. All enhancements 
to live-fire training, blank ammunition training, and inert training 
conducted on the firing range have been completed and this training has 
been resumed. Classroom training using inert rounds will not be resumed 
until receipt of distinctively marked dedicated weapons that have been 
disabled and rendered incapable of discharging a round.
    A1(e). The August 2004 exercise at the Nevada Test Site resulted in 
simulated ``friendly fire'' casualties among the defending protective 
force personnel. We certainly take such deficiencies very seriously, 
but recognize that these exercises provide us the benefit of 
identifying areas of potential weakness where tactical programmatic 
improvements can be implemented. Evaluators identified the cause of 
this incident as a lack of protective force proficiency training that 
had not kept pace with recent dramatic changes in the Site's protective 
mission. Subsequent improvements in the Nevada Test Site protective 
forces training program have resulted in no such occurrences during 
similar exercises conducted by external assessment teams in November 
2004 and January 2005. In addition to the measures mentioned, trained 
protective force personnel from throughout the DOE/NNSA community have 
volunteered to augment the NTS protective force while Wackenhut hires 
and qualifies sufficient personnel to meet the needs of the expanding 
site mission. Federal and contractor security personnel at the Oak 
Ridge complex assessed the current protective force configuration at 
their location and determined they could support the short term Nevada 
augmentation without any increase in security risk or creating an 
unacceptable overtime burden on the existing forces.
    Q2. Do you believe that Wackenhut should be allowed to continue to 
provide security at DOE facilities? After all, there have been numerous 
reports of Wackenhut personnel cheating on security tests and 
retaliating against whistleblowers.
    A2. Wackenhut Services Incorporated's (WSI) overall performance in 
providing protective force services at DOE sites has been generally 
satisfactory. Many of the allegations that have prompted questions 
regarding their reliability are either exaggerated or unsubstantiated. 
The instances where deficient performance has been verified through 
independent and factually accurate assessments, WSI has responded with 
effective corrective actions and process improvements. WSI performance, 
both good and bad, has been considered in award fee determinations. 
There is no justification for considering early termination of their 
respective contracts.
    Q3. A March 2004 report by the Inspector General (IG) found that 
four DOE sites where Wackenhut Corporation holds the security contract 
(Nevada Test Site, Savannah River, Rocky Flats, Y-12) ``had eliminated 
or modified significant portions of the training while others were not 
using realistic training delivery methods.'' For example:

 At all four sites Wackenhut did not conduct basic training in the use 
        of shotguns.
 At the Nevada Test Site and Savannah River Site, Wackenhut excluded 
        or modified prescribed training techniques for vehicle 
        assaults.
 At Rocky Flats and Savannah River Wackenhut excluded or modified 
        defensive tactics.
 At none of its sites did Wackenhut include instruction in rappelling, 
        even though it was part of the special response team core 
        curriculum.
 At the Nevada Test Site and Oak Ridge Wackenhut eliminated or 
        substantially modified training in the use of batons.
    According to the IG report, sites using unrealistic training 
methods don't meet departmental requirements because the skills 
acquired by the officers cannot be adequately measured and the use of 
anything less than realistic training techniques, ``may rob the trainee 
of the exposure to the levels of force, panic, and confusion that 
usually present during an actual attack.'' Such deviations increase the 
possibility that the protective force ``will not be able to safely 
respond to security incidents or will use excessive levels of force.'' 
Do you approve of such deviations from the Department's training 
curriculum? What steps have you taken and what steps will you take to 
ensure that these deviations are stopped?
    A3. DOE has supported modification of the core protective force 
curriculum in those instances where training is not applicable to the 
performance requirements at that site. Training resources should be 
devoted toward the delivery and/or reinforcement of knowledge and 
skills that can be applied directly to the work location and the 
physical security needs of the facility. For instance, where the Basic 
Security Inspector training requires shotgun courses, sites that do not 
issue or employ the use of shotguns may be exempted from this part of 
the core curriculum. Similarly, baton training is not needed for 
protective force personnel from a site not using this equipment. All 
sites have Training Approval Programs that create a formal, management-
approved basis for individually tailored training that satisfies site-
specific needs and reduces costs.
    Training in tactical response scenarios must balance applicability, 
realism and safety. While it is widely recognized that skills such as 
rappelling contribute to an individual's self-confidence and tactical 
skills, training in rappelling techniques is not essential to meet site 
response requirements. Thus, this area of the core curriculum is not 
presented at the field locations.
    For example, the NNSA has polled each of its sites where local 
Basic Security Police Officer Training and Special Response Team 
Qualification Training is conducted to determine all specific instances 
where the curriculum deviates from the National Training Center's (NTC) 
core curriculum. A recent review by a Training Transition Team, as well 
as changes in the Design Basis Threat Policy, are continuing to provide 
insights in terms of cost effective methods to provide the best 
training available to the Department's protective force cadre. 
Furthermore, the DOE Office of Independent Oversight and Performance 
Assurance (OA) completed a special review of the NTC's protective force 
training program late last year, and is completing publication of the 
results. Upon notification of the findings from this assessment and 
receipt of the final report, NNSA will support the NTC in modifications 
to the core curricula, and will ensure that locally-administered 
training programs at NNSA sites are updated accordingly.
    Q4. In January 2004, the IG also found that Wackenhut supervisory 
personnel had been tipped off in advance during a DOE drill developed 
to ensure that the site's protective force can respond to potential 
security threats, such as a terrorist attack. Government investigators 
concluded that Wackenhut's actions were improper and had tainted the 
test results to the degree that they could not be relied upon. The IG 
recommended that the Manager, Y-12 Site Office, and the Manager, Oak 
Ridge Operations Office ``Evaluate whether the information disclosed by 
(the) review impacts any previous analysis of the efficacy of the 
site's protective force, and take appropriate corrective actions.''
    (a) Have corrective actions been undertaken? If so, will you please 
identify them? If not, why not?
    The IG report also recommended that the Manager, Y-12 Site Office, 
and the Manager, Oak Ridge Operations Office ``Consider the information 
disclosed by our review when evaluating Wackenhut's performance, and 
take appropriate action with respect to determining award fee.''
    (b) How has the information revealed by the IG's report affected 
DOE's evaluation of Wackenhut's performance? What action do you intend 
to take with respect to Wackenhut's award fee?
    A4(a). The January 2004 DOE IG report subject, ``Protective Force 
Performance Test Improprieties'', found that pre-test improprieties had 
the potential to adversely impact the realism of the performance test 
and its outcome. These improprieties did not involve ``tipping off'' of 
personnel. Analyses based on the new Design Basis Threat policy 
characterize the current BWXT Y-12 security posture without reliance on 
the performance test held in June 2003. This test did not impact the 
current assumptions in the BWXT Y-12 security posture. New test plans 
and procedures have been developed to ensure clarity of test 
expectations and roles and responsibilities of individuals who plan and 
participate in performance test exercises.
    A4(b) Wackenhut's overall performance in providing protective force 
services at DOE sites has been generally satisfactory. Many of the 
allegations that have prompted questions regarding their reliability 
are either exaggerated or unsubstantiated. In instances where deficient 
performance has been verified through independent and factually 
accurate assessments, Wackenhut has responded with effective corrective 
actions and process improvements. Wackenhut performance, both 
satisfactory and unsatisfactory, has been considered in award fee 
determinations.
    Q5. As you know, foreign-owned companied cannot perform on 
security-sensitive DOE contracts unless they take specific steps to 
insulate themselves from ``foreign ownership control or influence'' 
(FOCI). As you may know, Group 4 Falck controls the operations of The 
Wackenhut Corporation. Both companies are parties to a Proxy Agreement 
that negates FOCI for The Wackenhut Corporation's subsidiary Wackenhut 
Services, Inc. by shielding the foreign owner from any role in 
controlling the operations of the U.S. contractor. FOCI regulations 
specify that the DOE and Wackenhut shall meet at least annually to 
review the effectiveness of the security arrangement and specify that 
the proxy holders shall submit an implementation and compliance report. 
Please supply all departmental documents resulting from the 2002, 2003 
and 2004 annual reviews for the company including: the questions DOE 
asked and the answers provided by the company; memos; correspondence; 
emails; the proxy holders' implementation and compliance report; and 
the Lead Responsible Office's report.
    A5. Attached are the documents requested. Those documents are:

1. Proxy Holders' implementation and compliance report for 2002.
2. Documentation of the 2002 annual meeting. NOTE: Representatives from 
        both DOE Headquarters Office of Security and DOE Savannah River 
        Participated in the Government's 2002 annual compliance review. 
        Documentation of the 2002 annual meeting was prepared by DOE 
        Headquarters. The Lead Responsible Office (i.e., Savannah River 
        Operations Office) did not prepare documentation of this 
        meeting.
3. Proxy Holders' implementation and compliance report for 2003.
4. Savannah River's documentation of the 2003 annual meeting.
    Also attached is the Department's Guidelines, which cover 
discussion points that are always addressed/reviewed during the conduct 
of annual compliance meetings for companies cleared under a Proxy 
Agreement, Voting Trust, Special Security Agreement, or Security 
Control Agreement.
    Note: This response was prepared in coordination with DOE Savannah 
River, who is the lead responsible office for FOCI for Wackenhut.
    [The documents are retained in committee files.]
    Q6. In February 2004, DOE announced it had awarded a no-bid 
contract worth up to $40 million a year to provide security and other 
services at the Idaho National Engineering and Environmental Laboratory 
(INEEL) to Alutiiq, LLC, an Alaskan native corporation with no prior 
security experience. The contract was to run for three years with two 
one-year extensions, for a possible total of $200 million. As you may 
know, Alutiiq has in the past sub-contracted its security work to the 
Wackenhut Corporation. After considerable criticism from Congress and 
others, the Department announced on April 27th that it would not 
contract out security services at INEEL after all.
    (a) Does the Department have any current contracts with Alutiiq or 
any other Alaskan native corporation that were awarded non-
competitively? If so, please provide a list of all such contracts the 
date on which they were awarded, the amount of money awarded, the terms 
of the work and the identities of any subcontractors utilized by the 
prime contractors.
    (b) Has Alutiiq or any other Alaskan native corporation submitted 
bids, letters of interest, or any other notification to the Department 
with respect to other security contracts? If so, please provide a list 
of all such bids, letters of interest and other notifications, 
including the date, name of the DOE site involved, funding amount of 
the contract, and what decision, if any, that DOE has made.
    (c) Is it Department policy to award contracts non-competitively? 
If not, why did you deviate from that policy in this case?
    A6(a). The Department of Energy does not have any contracts with 
Alutiiq. With respect to Department of Energy contracts with other 
Alaskan native corporations, the information must be obtained from DOE 
field contracting offices because the Government-wide procurement data 
system that identifies Federal contracts does not separately identify 
contract awards to Alaskan native corporations. We will provide this 
information to you under separate cover within the next thirty days.
    A6(b). The Department does not have a corporate data system or 
other mechanism that can produce the requested information. The 
requested information must be obtained from each Department of Energy 
field contracting office. We will provide this information to you under 
separate cover within the next thirty days.
    A6(c). DOE's policy is to award contracts as a result of full and 
open competition to the maximum practicable extent, in accordance with 
the Competition in Contracting Act (CICA), 41 U.S.C.  253, and the 
implementing Government-wide acquisition regulations. CICA identifies 
certain instances in which agencies may award contracts non-
competitively. These instances include the noncompetitive award of a 
contract in accordance with other statutory authorities. Such authority 
exists with respect to the Small Business Administration (SBA) Section 
8(a) program. DOE, like other Federal agencies, comports with this, and 
other small business related statutory authority, to meet its small 
business contract award goals. The instance identified in this question 
is an example of award pursuant to the SBA Section 8(a) program. Under 
the law and SBA's implementing regulations, Alaskan native corporations 
that meet the requirements for Section 8(a) status can receive a 
noncompetitive contract award of any dollar value. In making such 
awards, DOE assures that the qualifying Alaskan native corporation 
itself provides at least 51% of the services required under the 
contract.

On reimbursement of DOE Legal Fees
    Q1. As you know, the Department often reimburses the legal fees of 
its contractors who are engaged in legal disputes with whistleblowers 
or individuals alleging sexual harassment, discrimination or other 
wrongdoing on the part of the contractors. While I understand the need 
for some of these costs to be reimbursed, I have long been concerned 
that the Department does not use any discretion in determining which 
costs should be reimbursed and which should not. One glaring example of 
such a case is that of Dee Kotla, who alleged that she was retaliated 
against and ultimately fired by Lawrence Livermore National Lab (LLNL) 
in 1997 because she testified at a sexual harassment trial involving 
other Livermore personnel. Livermore reportedly said it fired Ms. Kotla 
for misuse of her computer and her telephone. However, according to 
reports on the matter Ms. Kotla only had $4.30 in local telephone 
charges, and said that her use of her computer was minimal. Ms. Kotla 
has been awarded a million dollars in damages by a jury as well as 
reimbursement of the legal fees to the lab. Yet the lab continues to 
file appeal after appeal and has made no serious efforts to resolve 
this matter.
    (a) How much has DOE been requested to pay to Livermore for its 
continued efforts to fight this case?
    (b) Why doesn't DOE do more to pressure its contractors to settle 
cases such as this one?
    (c) Will DOE continue to use taxpayer funds to reimburse costs of 
this case, no matter how many times the lab loses in court?
    (d) I co-authored bipartisan language that was included in the 
energy bill to limit the reimbursement of legal fees to contractors--
once a contractor has been ruled against once, if it continues to file 
appeal after appeal DOE will not be allowed to reimburse its legal fees 
unless it wins the case in the end. That way, contractors would have a 
financial incentive to resolve cases quickly. Do you support this 
concept? If so, will you include such a policy in all new contracts for 
management and operation of DOE facilities that the Department enters 
into?
    A1(a). To date, the Laboratory has spent and submitted invoices to 
the Department for approximately $1,239,000 to defend this case.
    A1(b). NNSA counsel has assessed the merits of this case at every 
stage of the litigation and agrees with the Laboratory that the action 
is without merit. The Laboratory has attempted mediation several times 
throughout the case, but Ms. Kotla's counsel has never made a 
reasonable settlement offer. It should be pointed out that, although 
the Laboratory ``lost'' the first trial, the California Court of Appeal 
reversed the jury verdict in its entirety and remanded the case to the 
trial court.
    A1(c). Just prior to the start of the new trial in this case, the 
Laboratory made a very generous settlement offer ($1.75 million) which 
was rejected by Ms. Kotla's counsel. The Department does encourage its 
contractors to explore reasonable settlement options when litigation is 
threatened or pending but would not pressure its contractors to settle 
cases without careful consideration of all factors, including the 
merits of the case and the proposed settlement amount. The Department's 
decision to continue reimbursement of the contractor's costs in this 
case will be based on a careful assessment of the merits at each stage 
of the litigation. The second trial is completed and jury deliberations 
are underway. At this point, the Department has made no decision 
regarding a post-trial course of action.
    A1(d). Over the past ten years, the Department has considered, and 
tried, a number of approaches to controlling the amount expended by its 
management and operating (M&O) contractors for litigation and other 
legal costs. Beginning in the mid-1990s, the Department included in 
many of its M&O contracts clauses governing the allowability of 
whistleblower defense costs that were similar to the approach described 
in your question. In 1998, the Department proposed to codify a contract 
clause that would make litigation, settlement and judgment costs in 
whistleblower actions unallowable if an adverse determination was 
issued in the case. As the result of a number of factors, including a 
review of the practices of other government agencies with respect to 
whistleblower litigation costs and comments received in response to the 
initial proposal, the Department, a year later, issued an alternate 
proposal to adopt a cost principle that would provide contracting 
officers the flexibility to make allowability determinations on a case-
by-case basis, after considering certain specified factors. One of the 
main dilemmas the Department confronted in assessing the merits of 
these two approaches was determining how to minimize contractor (and, 
therefore, DOE) litigation costs without sending the message that all 
whistleblower lawsuits, regardless of merit, should be settled short of 
litigation. In October, 2000, the Department published a final rule 
adopting the cost principle approach. In January 2001, the Department 
also finalized a set of regulations entitled ``Contractor Legal 
Management Requirements'' at 10 CFR Part 719, which was intended to 
facilitate control of Department and contractor legal costs, including 
litigation costs.
    We believe the Department's approach contained in the regulations 
adopted during the Clinton Administration is the correct one, enabling 
weighing the costs of litigation against the costs and public policy 
impacts of compensating non-meritorious claims. Under the Government-
wide Federal Acquisition Regulation, reasonable and allocable legal 
costs incurred by a contractor in performance of contract work are 
allowable contract costs and are reimbursed by the Government, whether 
as direct costs or as part of general and administrative costs. There 
appears no persuasive reason to single out the Department's M&O 
contractors for treatment that departs from the Government-wide norm.

On Reprocessing
    Q1. According to DOE budget documents, the $70 million Advanced 
Fuel Cycle Initiative ``develops technologies that would enable the 
reduction of spent nuclear fuel waster requiring geologic disposal and 
recovery of spent nuclear fuel's valuable energy.'' In other words, 
nuclear reprocessing. On February 11, 2004, President Bush announced 
new measures to counter the spread of Weapons of Mass Destruction, 
stating:
          ``The world must create a safe, orderly system to field 
        civilian nuclear plants without adding the danger of weapons 
        proliferation. The world's leading nuclear exporters should 
        ensure that states have reliable access at reasonable cost to 
        fuel for civilian reactors, so long as those states renounce 
        enrichment and reprocessing. Enrichment and reprocessing are 
        not necessary for nations seeking to harness nuclear energy for 
        peaceful purposes.''
          Don't you think that telling other countries that they 
        shouldn't reprocess while requesting $70 million to develop NEW 
        reprocessing technologies is just like preaching temperance 
        from a bar stool?
    A1. The National Energy Policy recommends that the United States 
``consider technologies (in collaboration with international partners 
with highly developed fuel cycles and a record of close cooperation) to 
develop reprocessing and fuel treatment technologies that are cleaner, 
more efficient, less waste-intensive, and more proliferation 
resistant.'' The Department of Energy (DOE) believes that advanced 
technologies such as those being developed by DOE's Advanced Fuel Cycle 
Initiative (AFCI) can point the way toward meeting our long-term energy 
security needs while presenting the world with nuclear technologies 
that are safe and proliferation resistant.
    As the President indicated, ``Enrichment and reprocessing are not 
necessary for nations seeking to harness nuclear energy for peaceful 
purposes.'' It is very appropriate to encourage states that do not 
today have these nuclear fuel cycle infrastructures against building 
enrichment and reprocessing plants. The United States is already 
experienced in both uranium enrichment and recycling technologies and 
is leading the world to develop new technologies that can significantly 
reduce the proliferation risks posed by current, commercial 
reprocessing technology. International partners consistently rely on 
the United States for sharing our safe operational practices and where 
allowed under export control requirements, nuclear energy technology 
intended for peaceful use. If the United States is able to engage and 
lead the international community in the development of more 
proliferation-resistant technologies, the world benefits from an 
international nuclear fuel infrastructure that is safer and more secure 
than that which exists today.

General Question on Non-Proliferation
    Q1. Both Senator John Kerry and President Bush said that nuclear 
proliferation was the greatest danger to our national security. And in 
the mission statement of the Office of Defense Nuclear Nonproliferation 
it states that in today's volatile, unpredictable, and dangerous 
international environment, there is no mission more important than 
stemming proliferation and terrorist threats. The head of the IAEA, Dr. 
ElBaradei, pointed our the hypocrisy of this U.S. policy in the 
Washington Post (January 30, 2005, p. B1). The Post asked: ``The U.S. 
Department of Energy was interested in doing research on nuclear bunker 
busters and other nuclear equipment.'' ElBaradei answered: ``That sent 
the wrong message--you can't tell everyone `don't touch nuclear 
weapons' while continuing to build them.'' Why then is Congress asked 
to fund the Robust Nuclear Earth Penetrator, the so-called bunker 
buster, after we canceled it last year? How can we tell other nations 
like Iran or North Korea that they should not be pursuing nuclear 
weapons while at the same time we, the United States, is developing new 
weapons?
    A1. The major objective of U.S. nonproliferation policy is to 
dissuade, prevent, or delay rogue states and terrorist groups from 
acquiring WMD, WMD-related materials, technology, expertise, and 
systems for their delivery. The RNEP study, or other exploratory 
research on nuclear weapons, is unlikely to increase incentives for 
terrorists to acquire WMD--those incentives are already high and are 
unrelated to U.S. nuclear (or conventional) defense capabilities. Nor 
is it likely to have any impact on rogue state proliferation, which 
marches forward independently of the U.S. nuclear program. Indeed, 
there is no indication at all that very significant reductions in the 
numbers of U.S. (and Russian) nuclear weapons, and in the alert levels 
of nuclear forces, over the past decade, coupled with no U.S. nuclear 
testing, no new warheads deployed, and very little U.S. nuclear 
modernization, have caused North Korea or Iran to slow down covert 
programs to acquire capabilities to produce nuclear weapons. On the 
contrary, these programs have accelerated during this period. Neither 
did such U.S. restraint convince India and Pakistan not to test in 
1998. Rather, North Korea and Iran seek WMD in response to their own 
perceived security needs, in part, to deter the United States from 
taking steps to protect itself and allies in each of these regions. In 
this regard, their incentives to acquire WMD may be shaped more by U.S. 
advanced conventional weapons capabilities and our demonstrated will to 
employ them to great effect--in Bosnia, Kosovo, Afghanistan, and during 
both wars with Iraq--than to anything the U.S. has done, or is doing, 
in the nuclear weapons arena.
    Q2. Similarly I would ask you to expand on the new program, the 
Reliable Replacement Warhead. Statements by Dr. John Harvey in a New 
York Times article on Monday seemed to leave open the door to testing: 
``Our goal is to carry out this program without the need for nuclear 
testing. But there's no guarantee in this business, and I can't prove 
to you that I can do that right now.'' Again, the U.S. would be saying 
one thing but doing another with the potential of ending the U.S. 
moratorium on testing. What is your position on testing nuclear 
weapons? Will you commit to reevaluate your Department's ability to 
support to support a nuclear test moratorium indefinitely and to 
reconsider the Administration's policy on the Comprehensive Test Ban 
Treaty?
    A2. The intent of the Reliable Replacement Warhead program is to 
identify replacement warhead options that could be fielded without 
nuclear testing. With regard to testing nuclear weapons, our stockpile 
stewardship program has not yet uncovered a problem in the stockpile 
that would require a nuclear test. Moreover, we are confident that this 
program can provide the tools needed to ensure stockpile safety and 
reliability, absent such tests, for the foreseeable future. As a 
result, the President continues to support a moratorium on nuclear 
testing. At this time, I do not envision that the Administration will 
revisit its position on testing unless the Secretaries of Defense and 
Energy identify a problem in a warhead critical to the nation's 
deterrent that could not be fixed without nuclear testing.
    The Department supports the Administration's current policy on the 
Comprehensive Test Ban Treaty.

On New Nuclear Weapons
    Q1. Last year Congress created a new DOE program called the 
Reliable Replacement Warhead (RRW). Last year's energy and water 
appropriations Conference Report states that this new program is ``to 
improve the reliability, longevity, and certifiablity of existing 
weapons and their components'' in contrast to the purpose of the 
Advanced Concepts program it replaced, which was ``to research new 
weapons and designs.'' In the DOE budget request, RRW is stated as a 
program ``to demonstrate the feasibility of developing reliable 
replacement components that are producible and certifiable for the 
existing stockpile . . . [with an] initial focus on--replacement 
pits.''
    (a) What exactly is the intent of this program? Is the purpose to 
refurbish and increase the reliability of existing nuclear warhead 
types, or to replace existing warheads with new designs or warheads?
    (b) If this program is intended to replace existing, well-tested 
and understood warhead types, how do you propose to increase the 
reliability of the arsenal without resorting to nuclear testing?
    (c) If the program is intended to refurbish the reliability of 
existing warhead types, how does the program differ from the ongoing 
and expensive Stockpile Life Extension program and other efforts 
underway to increase the performance margins of existing warhead types? 
Will all warheads be affected?
    A1(a). In order for the United States to sustain its nuclear 
weapons stockpile, we believe it will be necessary to have the 
capability to replace most of the components in the weapons in the 
present stockpile. Therefore, we are beginning a program to understand 
whether, if we relaxed some of the warhead design constraints imposed 
on Cold War systems (e.g., high yield to weight ratios), we could 
provide components for existing stockpile weapons that could be more 
easily manufactured and whose safety and reliability could be certified 
with high confidence, without nuclear testing. We intend that such an 
effort will also result in reduced infrastructure costs for supporting 
the stockpile. The focus of the RRW program is to extend the life of 
the military capabilities provided by existing warheads. We expect 
warheads that might ultimately result from this program to meet the 
military capabilities of the warheads they replace and to be delivered 
by existing delivery systems. We need to complete the concept and 
feasibility studies before we can characterize specific features of 
feasible RRW options in detail.
    A1(b). The RRW program will focus on non-nuclear and nuclear 
replacement components that will not require nuclear testing. The 
design of RRW components will be based on modern, non-nuclear 
experimental techniques and analytical tools to establish a replacement 
warhead that provides the same military capabilities as when the 
warheads were placed in the stockpile. These modern techniques and 
analytical tools have been developed under the Stockpile Stewardship 
Program to establish that the Nation's nuclear arsenal is safe and 
reliable, without a need for nuclear testing. We believe, in fact, that 
a successful RRW program has the potential to reduce the possibility 
that the Nation may need to conduct a test in the future to ensure 
reliability of the stockpile.
    A1(c). A key objective of the RRW program is to develop replacement 
components that have a lower cost to manufacture, certify, and 
maintain. To be successful and worth pursuing, the RRW program must 
demonstrate a less-costly, long-term path to maintain the Nation's 
nuclear weapon arsenal. In the coming decades, the RRW approach to 
develop, certify, and maintain replacement warhead components could be 
used for all warheads.
    Q2. Last year Congress created a new DOE program called the 
Reliable Replacement Warhead (RRW). Last year's energy and water 
appropriations Conference Report states that this new program is ``to 
improve the reliability, longevity, and certifiability of existing 
weapons and their components'' in contrast to the purpose of the 
Advanced Concepts program it replaced, which was ``to research new 
weapons and designs.'' In the DOE budget request, RRW is stated as a 
program ``to demonstrate the feasibility of developing reliable 
replacement components that are producible and certifiable for the 
existing stockpile . . . [with an] initial focus on--replacement 
pits.''
    This program appears to blur the line between upgrading current 
nuclear weapons and making new weapons. At what point do modifications 
change a weapon so much that it is in effect a new nuclear weapon in 
old casing that will require testing?
    A2. The Reliable Replacement Warhead program is designed to 
demonstrate the feasibility of developing components for existing 
stockpile weapons that could be more easily manufactured and whose 
safety and reliability could be certified with assured high confidence, 
without nuclear testing. We intend that such an effort will also result 
in reduced infrastructure costs for supporting the stockpile.
    Q3. Last year Congress created a new DOE program called the 
Reliable Replacement Warhead (RRW). Last year's energy and water 
appropriations Conference Report states that this new program is ``to 
improve the reliability, longevity, and certifiablity of existing 
weapons and their components'' in contrast to the purpose of the 
Advanced Concepts program it replaced, which was ``to research new 
weapons and designs.'' In the DOE budget request, RRW is stated as a 
program ``to demonstrate the feasibility of developing reliable 
replacement components that are producible and certifiable for the 
existing stockpile . . . [with an] initial focus on--replacement 
pits.''
    Would development of the Reliable Replacement Warhead program 
require the construction of a new, multi-billion dollar, plutonium 
``pit'' production facility?
    A3. The development of a reliable replacement warhead (RRW) does 
not obviate the need to establish a responsive, long-term pit 
manufacturing facility. The size and production capacity of that 
facility will be determined by, among other factors: 1) the technical 
conclusions on the acceptable lifetime of plutonium pits; and 2) 
requirements for the number of nuclear weapons in the U.S. stockpile.
    Q4. The projected costs for this program till FY2010 and including 
the funding appropriated for FY2005 is $106 million. Exactly how will 
the $8.929 million appropriated for FY2005 be used? What are the 
projected costs for FY2006-2010? How will costs increase if the program 
moves beyond research to ``full-scale engineering development'' and to 
nuclear testing?
    A4. The funds appropriated for the Reliable Replacement Warhead 
(RRW) program in Fiscal Year (FY) 2005 and the request for FY 2006 will 
be used to complete a feasibility study of the potential benefits of a 
reliable replacement warhead. The objective of the RRW study is to 
investigate the feasibility of replacement warheads that can be 
certified without nuclear testing, and can be manufactured and 
maintained more efficiently than currently stockpiled warheads 
resulting in a smaller, more cost-effective production complex. An 
initial focus of the study will be on long-lead components (e.g., 
plutonium pits).
    If the potential benefits of reliable replacement warheads are 
established during the study period, a multi-year plan will be 
developed to define cost estimates for follow-on engineering 
development, if such were to be requested. For the long-term, the RRW 
program should provide replacement components for warheads in which we 
would have higher confidence to meet current military requirements 
without nuclear testing in comparison to replicating existing warheads. 
Thus, the intent of the RRW program is to identify replacement 
components for options that could be fielded without nuclear testing.
    The Future-Years Nuclear Security Program for RRW: FY 2006: 
$9.351M; FY 2007: $14.775M; FY 2008: $14.413M; FY 2009: $29.553M; FY 
2010: $28.964M. If the program were to move to engineering development, 
the requested funds would increase substantially, but at this time they 
cannot be determined due to the obvious uncertainties in program scope.
    Q5. Last year Congress acted to meet the U.S. commitment agreed to 
under the Moscow Treaty so that by December 31, 2012 the aggregate 
number of strategic nuclear warheads does not exceed 1700-2200. 
Congress appropriated $65 million, a sharp increase from FY 2004 of 
$24.6 million and the Department's request of $35 million for FY 2005. 
In your budget request for FY 2006 this number is back down to $35 
million.
    (a) Are you committed to meet the requirements agreed to under the 
Moscow Treaty?
    (b) Can you explain how budget request of $35 million for FY 2006 
will be adequate when Congress clearly felt this was not the case last 
year?
    A5(a) The U.S. will meet its commitment agreed to in the Moscow 
Treaty for 1700-2200 operationally deployed strategic nuclear weapons 
by December 31, 2012. While there are no provisions in the Moscow 
Treaty requiring warhead dismantlement, the U.S. plans to dismantle 
excess warheads as quickly as possible, balancing this effort with 
support for the enduring stockpile through refurbishment and 
surveillance activities.
    A5(b). The budget request for dismantlement activities is 
essentially at the same level of effort in FY 2006 as appropriated in 
FY 2005. The Fiscal Year (FY) 2005 Directed Stockpile Work ``Retired 
Warheads Stockpile Systems'' budget line contained both direct and 
indirect costs associated with dismantlement activities. In FY 2006, 
the line for ``Retired Warheads Stockpile Systems'' contains only the 
direct costs of dismantlement, and the indirect costs associated with 
this work are budgeted in the Production Support and Research and 
Development Support lines. This is consistent with the treatment of 
other weapons work in the Life Extension Programs and Stockpile Systems 
lines. This approach allows NNSA to provide more visibility into these 
costs, consistent with Congressional guidance over the past several 
years. With this improved way to portray costs, the FY 2006 budget 
request of $35.245 million for Dismantlements is effectively the same 
as the FY 2005 appropriation.

On the Robust Nuclear Earth Penetrator
    The fiscal 2006 DOE budget request includes $4 million for further 
research on the Robust Nuclear Earth Penetrator (RNEP) and apparently 
another $4.5 million is requested in the fiscal 2006 DoD budget for the 
program. The budget documents suggest that the Department seeks to 
complete the phase 6.2 research component of the program by the end of 
fiscal 2007, and then I assume it may request Congress for 
authorization and appropriations for phase 6.3 development of such a 
new nuclear weapon. I have several questions:
    Q1. Did the DOE or the State Department formally evaluate how the 
requested funding to renew the (RNEP) program will affect U.S. nuclear 
nonproliferation objectives at the May 2005 NPT Review Conference? Yes 
or No?
    A1. In March 2004 the Departments of State, Defense and Energy 
communicated a report to Congress--An Assessment of the Impact of PLYWD 
Repeal on the Ability of the United States to Achieve Its 
Nonproliferation Objectives--which addressed the broad issue of whether 
nuclear weapons exploratory research would affect the nonproliferation 
objectives of the United States. They concluded that while such 
activities will slightly complicate U.S. nonproliferation diplomacy, we 
anticipate no significant impact on the ability of the United States to 
achieve its objectives at the 2005 Nuclear Nonproliferation Treaty 
Review Conference. Moreover, there is no reason to believe that such 
activities have had or will have any practical impact on the pursuit of 
nuclear weapons by proliferating states, on the comprehensive 
diplomatic efforts ongoing to address these threats, or on the possible 
modernization of nuclear weapons by China or Russia.
    Q2. Did you have the opportunity to evaluate the pros and cons of 
the renewal of the (RNEP) program, and if you did, did you take the 
time to consult with persons outside the Department of Energy and 
Defense or the nuclear weapons labs about the nonproliferation 
implications of restarting this program?
    A2. As I mentioned above, the nonproliferation impacts of U.S. 
nuclear weapons exploratory research--which includes the RNEP study--
are manageable and should not affect the ability of the United States 
to achieve its non proliferation objectives. We have consulted with the 
Department of State in making this assessment.
    Q3. What specific work would your fiscal year 2006 RNEP request 
support? Would the work continue on modifications of both the B61 and 
B83 gravity bombs, or just one of them? Do you propose any field 
testing of the mock warheads or any other activity beyond paper 
studies?
    A3. The Fiscal Year 2006 budget request for the Robust Nuclear 
Earth Penetrator would support the execution of the B83 warhead ``High 
G'' non-nuclear sled-track impact test. The B61 option has been put on 
stand-by until the feasibility of the B83 is known, with no B61 work 
planned for now (the approved Phase 6.2/2A Cost and Feasibility Study 
included sled-track tests for each option to determine feasibility). No 
full system field tests (drop from aircraft with guidance kit) will be 
performed in Phase 6.2/2A.
    Q4. Has any responsibility or funding for the RNEP program been 
transferred to the Pentagon? What specific activities would the $4.5 
million in the DoD budget support? Would any of the work performed at 
the DOE national laboratories be supported with the DoD funds?
    A4. In March 2004, the Nuclear Weapons Council Standing and Safety 
Committee approved the restructured plan for the Robust Nuclear Earth 
Penetrator Phase 6.2/2A Cost and Feasibility Study that assigns the 
responsibility of the Navigation, Guidance, and Control (NG&C) to the 
Air Force. The Department of Defense (DoD) budget request of $4.5 
million would provide support for the integrated product teams, 
interface requirement development, initial aircraft integration, and 
NG&C preliminary design development.
    Q5. Last year, the Department released a 5 year budget projection 
for the bunker buster that added up to nearly $500 million for research 
and development activities. What is your revised 5 year estimate for 
the total research and development cost of the current program?
    A5. In its Fiscal Year (FY) 2005 budget submission, the NNSA 
included out-year funding for the Robust Nuclear Earth Penetrator 
(RNEP) as a place holder. To avoid any confusion that this study is 
authorized to proceed beyond the Phase 6.2/2A Cost and Feasibility 
Study, those budget wedges have been removed in the FY 2006 budget 
submission ($4 million requested in FY 2006, $14 million planned for FY 
2007, no funding planned yet after FY 2007).

On Radioactive Materials
Highly Enriched Uranium
    Q1. Highly enriched uranium (HEU) is currently used in research 
reactors both in the United States and abroad. HEU presents a 
proliferation threat because it could be used in a nuclear weapon.
    The United States has provided HEU to other nations as fuel in 
their research reactors. A recent Government Accountability Office 
Report (GAO-05-57) reported that only 12 of 34 countries to which the 
United States provided HEU have formal agreements to return this fuel 
as spent fuel. What will your Department do to increase the number of 
countries with commitments to return to this fuel?
    A1. Under the recently created Global Threat Reduction Initiative 
(GTRI), the Department of Energy (DOE) is working to ensure that no 
nation has a reason to continue to hold and use high-risk, vulnerable 
nuclear material. The Department is aggressively working with the 
Department of State and international partners to address any holdouts 
under the Foreign Research Reactor Spent Nuclear Fuel Acceptance 
Program through a revised, re-invigorated, and comprehensive diplomatic 
and operational action plan, that may include incentives. At the same 
time, the Department is cognizant of the fact that participation in 
this program is fully voluntary. If a nation chooses not to 
participate, or makes other arrangements to responsibly manage its 
spent nuclear fuel, it is free to do so. National Nuclear Security 
Administration Administrator Linton Brooks provided a detailed response 
on February 24, 2005, to Congressman Markey, regarding the Department's 
specific strategy for the remaining 11 countries that are currently not 
participating in the Foreign Research Reactor Spent Nuclear Fuel 
Acceptance Program. A copy of that letter is attached.
    Q2. Highly enriched uranium (HEU) is currently used in research 
reactors both in the United States and abroad. HEU presents a 
proliferation threat because it could be used in a nuclear weapon.
    Given the proliferation threat posed by HEU, would you oppose 
weakening current restrictions on exporting HEU out of the United 
States?
    A2. Yes, the Department of Energy (DOE) would oppose weakening 
restrictions. Because of the proliferation threat posed by HEU, the 
objective of the Reduced Enrichment for Research and Test Reactors 
(RERTR) program that was consolidated under the Department's recently 
created Global Threat Reduction Initiative is to reduce, and eventually 
eliminate, the use of HEU in civil nuclear applications. This objective 
will be achieved by converting research reactors that use HEU fuel to 
use low-enriched uranium fuel. Of the total 105 research reactors 
targeted by the RERTR program, 39 reactors have already converted to 
LEU fuel. The Department has set an aggressive completion date of 2014 
for the remaining 66 research reactors here at home and abroad.
    Q3. Highly enriched uranium (HEU) is currently used in research 
reactors both in the United States and abroad. HEU presents a 
proliferation threat because it could be used in a nuclear weapon.
    HEU is also used in research reactors located at U.S. universities. 
Would you support an assessment of the costs and benefits of continued 
operation of HEU-fueled research reactors at U.S. universities, looking 
to either shut down these reactors or pay to convert them more rapidly 
to LEU than in current plans? In the meantime, would you support 
funding to increase physical protection of these facilities?
    A3. The Department is currently developing a plan to convert the 
remaining 66 targeted research reactors under Reduced Enrichment for 
Research and Test Reactors Program that continue to use HEU. This 
includes converting the remaining 14 domestic research reactors, 8 of 
which can convert using currently available LEU fuels and 6 of which 
will require the development of high-density LEU fuels. An assessment 
of the costs and benefits of continued operation of HEU-fueled research 
reactors at U.S. universities, looking to either shut down these 
reactors or pay to convert them more rapidly to LEU, would, therefore 
seem to be unnecessary. The reactors that remain to be converted are 
among those that receive the most use by the faculty, students and 
researchers and are vital to the Nation's scientific and educational 
infrastructure.
    As the recent GAO report identified, DOE and NRC recognized the 
need to further improve security at research reactors throughout the 
world, including in the United States. The need for any further 
security measures at U.S. university research reactors is currently 
being examined by the NRC. Once their findings are made available to 
the Department, implementation of any recommended changes will be 
implemented as funds become available. Thus, as required, the 
Department would support additional funding to increase physical 
protection at these facilities. Under the Department of Energy's 
Nonproliferation and International Security program, security upgrades 
have been provided at research reactors in Central Europe as well as 
the Newly Independent States and Baltics. The Nuclear Regulatory 
Commission is responsible for ensuring that adequate security is in 
place at domestic reactors.
    Q4. Highly enriched uranium (HEU) is currently used in research 
reactors both in U.S. and abroad. HEU presents a proliferation threat 
because it could be used in a crude nuclear weapon.
    Another effort to reduce the dangers of HEU is to downblend HEU to 
low enriched uranium, LEU. While HEU is weapons usable, LEU is not. 
Under a 1993 U.S.-Russian agreement, Russia will convert 500 metric 
tons of HEU from dismantled warheads to LEU by 2013. The United States 
Enrichment Corporation (USEC), private U.S. company that makes LEU for 
reactor fuel and then sells it on the open market, is implementing the 
U.S.-Russian HEU blend-down agreement. Another 500 metric tons of HEU 
will remain in Russia after 2013. USEC does not want to speed up the 
downblending of Russian HEU for feat that too much LEU will glut the 
market and reduce profits. One solution is that the U.S. could purchase 
the excess LEU from USEC to preserve the market price of LEU. Would you 
support providing funding to increase the amount of Russian HEU that 
being downblended to LEU?
    A4. In response to the FY 04 Defense Authorization Act Section 
3123, the Department submitted a report to Congress on February 28, 
2005 concerning the feasibility of purchasing additional fissile 
material from the former Soviet Union. The report's conclusion was that 
the Department's comprehensive approach of securing, eliminating, 
disposing and removing material in Russia and elsewhere provides a high 
degree of security from the U.S. perspective while being far more cost-
effective than attempting a large outright purchase.
    Because this is such an important nonproliferation and energy 
security issue and the Department has a history of purchasing HEU, we 
will continue to consider additional purchases of down-blended HEU from 
Russia. However, recent experience with the Russians on purchases after 
the 2002 Bush-Putin Summit Initiative suggests the Russians are asking 
what we consider an unreasonably high price for additional HEU.

Radioactive Sealed Sources
    Q1. Radioactive sealed sources also pose serious threats to 
national security because they could be used in dirty bombs. I commend 
you on the large increase in funding for the U.S. Radiological Threat 
Reduction program, which includes the Off Site Recovery Program (OSR), 
in the FY2006, up from $5.6 million in FY2005 to $12.8 million in FY 
2006.
    How will these funds be used in FY2005, and what do you expect the 
funds to be used for in FY 2006?
    A1. In FY 2005, the Department of Energy (DOE) plans to recover 
1,478 U.S. excess sealed sources. The increase in FY 2006 allows DOE to 
recover an additional 2,250 U.S. excess sealed sources. The increase 
will also allow the NNSA to expand the scope of the program up to ten 
isotopes of concern, adding such isotopes as Cobalt-60 and Iridium-192, 
and the program capabilities for a broader range of Cesium-137 and 
Strontium-90 sources. For these isotopes, the increased funding 
provides for assessing recovery risks and needs and developing 
necessary infrastructure to recover sources.
    The funding will also allow NNSA to respond to emerging critical 
national security recovery actions identified by other agencies, to 
provide technical assistance for security enhancements to in-use, high-
risk sources in the United States, and to integrate domestic efforts 
with international efforts to ensure there are no gaps in global 
coverage.
    Q2. Radioactive sealed sources also pose serious threats to 
national security because they could be used in dirty bombs. I commend 
you on the large increase in funding for the U.S. Radiological Threat 
Reduction program, which includes the Off Site Recovery Program (OSR), 
in the FY2006, up from $5.6 million in FY2005 to $12.8 million in FY 
2006.
    Can you please expand on the planned activities of the 
International Radiological Threat Reduction program? What sources will 
be collected and from what countries? Were these sources originally 
provided by the U.S.? In the Department's best estimation how many 
unsecured sources are there internationally?
    A2. The Department of Energy's International Radiological Threat 
Reduction (IRTR) Program currently works in over 40 countries to 
identify, recover, secure, and facilitate the disposal of high-risk 
radiological materials, including Cobalt-60, Cesium-137, and Strontium-
90, to reduce the threat of a radiological attack against the United 
States.
    Sources are collected by the IRTR program as a function of in-
country consolidation. Only vulnerable source suitable for a 
radiological dispersal device (that meet certain thresholds) are 
considered by the program.
    By the end of FY 2004, the IRTR program had secured 69 sites around 
the world. In FY 2005, the Department plans on securing an additional 
105 additional high-priority sites that contain vulnerable radiological 
materials. Thus far in FY 2005, the Department has already secured 43 
sites in Bulgaria, Indonesia, Kazakhstan, Kyrgyzstan, Moldova, Poland, 
Russia, Tanzania, and Uzbekistan.
    In FY 2006, DOE plans to secure an additional 125 high-priority 
international sites around the world with vulnerable radiological 
material, bringing the total number of sites secured up to 299. 
Specifically, in FY 2006, the IRTR program intends to expand to 10 
additional countries, as budget and bilateral negotiations allow. It is 
believed that none of these sources are expected to be those that were 
originally provided by the United States.
    Although DOE does not have an exact number, the estimate is that 
there are hundreds of thousands of unsecured sources around the world.

                  QUESTIONS FROM REPRESENTATIVE GORDON

    Q1. Our tax policy rightly seeks to encourage electricity 
production and direct use of heat from geothermal deposits. However, 
currently there are no Federal incentives to encourage the use of other 
highly efficient and clean geothermal technologies. One of these 
technologies is geothermal heat pumps.
    What are the Department's views on how our country can better 
encourage the use of geothermal heat pump technology?
    A1. With over 750,000 geothermal heat pump units in use nationwide, 
the Department believes that they constitute a mature technology. The 
Department encourages their use by providing information to the public 
describing ground source heat pumps and their benefits.
    Specifically, the Department provides technical assistance to 
developers and potential users through the Geo-Heat Center at the 
Oregon Institute of Technology in Klamath Falls, Oregon. The 
International Ground Source Heat Pump Association and the Geothermal 
Heat Pump Consortium are also proactive in accelerating the deployment 
of ground source heat pumps in the United States.
    Q2. Our tax policy rightly seeks to encourage electricity 
production and direct use of heat from geothermal deposits. However, 
currently there are no Federal incentives to encourage the use of other 
highly efficient and clean geothermal technologies. One of these 
technologies is geothermal heat pumps.
    Would the Department support the use of tax policy to encourage 
deployment of equipment that uses earth coupled heat pump technology 
which employs the inherent stability of earth temperatures to heat or 
cool a structure?
    A2. Because the technology is commercially viable and has been 
shown to be cost effective, the Administration does not think it 
necessary to support the use of tax incentives for geothermal heat 
pumps (i.e., earth coupled heat pumps or ground source heat pumps).

                  QUESTION FROM REPRESENTATIVE BALDWIN

    I am deeply concerned about the decision to cut the Department of 
Energy's Science program.
    The Science program's budget is a core part of the basic research 
agenda in the United States. From developing new energy technologies, 
to making groundbreaking discoveries that protect and clean our 
environment, there is no other government program that is so critical 
to our energy future.
    Most important to me, projects funded by the Science program assure 
our nation remains top in the world in the development of new 
technologies and fuel the innovation necessary to create good jobs.
    I see these benefits firsthand back home in Wisconsin and today I 
would like to give you a few examples just to emphasize how important 
the Department is to advancing breakthroughs in research.
    In fiscal year 2004 alone, the DOE awarded $39.8 million in 
research contracts to the University of Wisconsin-Madison, most of 
which focused on energy research and high-energy physics.
    DOE support has helped create programs like the Engine Research 
Center (or ERC) which is currently the largest university research 
center in the U.S. that studies the physics of combustion engines. 
ERC's past work has helped make our air cleaner to breathe. Today ERC 
is currently developing technologies that reduce nitrogen oxide 
omissions during the combustion cycle.
    The University of Wisconsin is also home to some of the most 
important advances in fusion and fission technologies in the world. UW-
Madison has trained more PhDs--over 330--in thermonuclear fusion than 
any other U.S. university and continues to produce the most graduates 
every year. Worldwide, UW scientists' contribution to fusion and 
fission research has been invaluable.
    I am deeply troubled because while your budget touts a $16.7 
million increase (6.1%) in the Fusion Energy Sciences Budget, there is 
a net decrease of $32.9 million to the existing domestic fusion program 
because $46 million was shifted from that budget to fund the ITER 
reactor at $49 million.
    While ITER is very important to international research on fusion, 
the cuts to domestic fusion research will have an immediate impact on 
our ability to make significant advances here at home.
    I cannot express how grateful I am for the past support the DOE has 
given institutions in my congressional district. However, cuts to the 
High Energy Physics (3.1%), Nuclear Physics (8.4%), Biological and 
Environmental Research (21%), and other Science programs will 
undoubtedly slow America's ability to make the engineering 
breakthroughs and scientific discoveries necessary to create better 
technologies and compete in the world throughout the 21st century.
    Q1. Given the immediate and future impact of these cuts, how can 
the Administration justify supporting billions of dollars in tax 
subsidies to profitable companies in the energy bill and increasing 
funding for fossil and nuclear technologies in the DOE budget while not 
making the necessary investments in these proven and pivotal Science 
research programs?
    A1. The Office of Science (SC), within a period of budget 
stringency, has chosen its priorities so that the U.S. will continue 
its world primacy in science. We have made hard decisions that will 
enable our scientists to work on the finest machines whose scale and 
magnitude will give them opportunities not found elsewhere. As a 
consequence, we have made difficult choices. But these have been taken 
with one end in mind: SC will provide world leadership in science and 
energy security with this budget.
    For example, in FY 2006 we will complete construction and initiate 
operation of the Spallation Neutron Source as well as 4 of 5 Nanoscale 
Science Research Centers. We will also initiate fabrication of 
equipment for ITER, a necessary experiment to study and demonstrate the 
sustained burning of fusion fuel. We start construction of the Linac 
Coherent Light Source, leading to an entirely new field of science and 
enabling us to see chemical bonds as they form, in a process akin to 
stop-action photography. We continue to operate Leadership Class 
computing facilities for open science that enable simulation of 
science. Also, the Office of Science supports the Administration's 
hydrogen initiative through continued basic research regarding 
production, storage and use of hydrogen. We continue research on 
climate modeling to improve our understanding of climate change through 
the Climate Change Science Program and continue our GTL (genomes to 
life) program to create or discover microbes to enable more efficient 
and economical cleanup of contaminated sites, sequestration of carbon, 
and production of hydrogen.

                 QUESTION FROM REPRESENTATIVE GONZALEZ

    Q1. As a follow up to your testimony to the House Committee on 
Energy and Commerce on February 9, 2005, I wish to ask you for the 
Department's position on the proposal elimination of DOE's Fossil 
Energy Program: (a) Why is the Department eliminating the natural gas 
infrastructure research and development program, (b) and as well as the 
proposed reduction in the Distributed Energy Resources Program in the 
President's Fiscal Year 2006 budget. Both these programs as you know 
fund valuable research in energy distribution and efficiency. In my 
view, research that improves the efficiency and reliability of the 
nation's energy infrastructure ultimately pays our nation back many 
times the initial cost of the research.

Eliminating Natural Gas Infrastructure R&D Program
    A1(a) For FY 2006, budget discipline necessitated close scrutiny of 
all Fossil Energy programs, using strict guidelines to determine their 
effectiveness and compare them to other programs offering more clearly 
demonstrated and substantiated benefits. After careful review of the 
oil and gas programs, it was determined that the industry has the 
capacity to pursue this research. As a result, the 2006 Budget proposes 
to conduct orderly termination of these programs in FY 2006, including 
the natural gas infrastructure research program.
    The Program Assessment Rating Tool (PART) was developed by OMB to 
provide a standardized way to assess the effectiveness of the Federal 
Government's portfolio of programs. The structured framework of the 
PART provides a means through which programs can assess their 
activities differently than through traditional reviews. A PART 
assessment of the natural gas research program was conducted from June 
through December 2002 for the FY 2004 Budget, and a reassessment was 
conducted from May through September 2003 for the FY 2005 Budget. OMB 
rated this program ``Ineffective'' in the PART analyses with scores of 
33% (FY2004) and 44% (FY 2005), based primarily on not demonstrating 
clear results of the research efforts.
    A1(b). In the case of distributed energy, the reduction in funding 
from the FY 2005 appropriated level reflects a level of success in 
certain technologies that are now within the capability of industry to 
pursue further, such as thermal barrier coating technologies, 
microturbine recuperator design and development, and advanced 
reciprocating engines. Areas that could produce public benefits from 
additional Federal assistance, such as thermal energy technologies, 
show an increase in the request amount. We also continue our focus on 
end use systems integration, where Federal assistance can accelerate 
the introduction of highly efficient combined heat and power systems.

                                 
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