[House Hearing, 111 Congress]
[From the U.S. Government Publishing Office]


 
                       NEW DIRECTIONS FOR ENERGY 
                    RESEARCH AND DEVELOPMENT AT THE 
                       U.S. DEPARTMENT OF ENERGY 

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

                                HEARING

                               BEFORE THE

                  COMMITTEE ON SCIENCE AND TECHNOLOGY
                        HOUSE OF REPRESENTATIVES

                     ONE HUNDRED ELEVENTH CONGRESS

                             FIRST SESSION

                               __________

                             MARCH 17, 2009

                               __________

                           Serial No. 111-11

                               __________

     Printed for the use of the Committee on Science and Technology

     Available via the World Wide Web: http://www.science.house.gov

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                                 ______

                  COMMITTEE ON SCIENCE AND TECHNOLOGY

                   HON. BART GORDON, Tennessee, Chair
JERRY F. COSTELLO, Illinois          RALPH M. HALL, Texas
EDDIE BERNICE JOHNSON, Texas         F. JAMES SENSENBRENNER JR., 
LYNN C. WOOLSEY, California              Wisconsin
DAVID WU, Oregon                     LAMAR S. SMITH, Texas
BRIAN BAIRD, Washington              DANA ROHRABACHER, California
BRAD MILLER, North Carolina          ROSCOE G. BARTLETT, Maryland
DANIEL LIPINSKI, Illinois            VERNON J. EHLERS, Michigan
GABRIELLE GIFFORDS, Arizona          FRANK D. LUCAS, Oklahoma
DONNA F. EDWARDS, Maryland           JUDY BIGGERT, Illinois
MARCIA L. FUDGE, Ohio                W. TODD AKIN, Missouri
BEN R. LUJAN, New Mexico             RANDY NEUGEBAUER, Texas
PAUL D. TONKO, New York              BOB INGLIS, South Carolina
PARKER GRIFFITH, Alabama             MICHAEL T. MCCAUL, Texas
STEVEN R. ROTHMAN, New Jersey        MARIO DIAZ-BALART, Florida
JIM MATHESON, Utah                   BRIAN P. BILBRAY, California
LINCOLN DAVIS, Tennessee             ADRIAN SMITH, Nebraska
BEN CHANDLER, Kentucky               PAUL C. BROUN, Georgia
RUSS CARNAHAN, Missouri              PETE OLSON, Texas
BARON P. HILL, Indiana
HARRY E. MITCHELL, Arizona
CHARLES A. WILSON, Ohio
KATHLEEN DAHLKEMPER, Pennsylvania
ALAN GRAYSON, Florida
SUZANNE M. KOSMAS, Florida
GARY C. PETERS, Michigan
VACANCY









                            C O N T E N T S

                             March 17, 2009

                                                                   Page
Witness List.....................................................     2

Hearing Charter..................................................     3

                           Opening Statements

Statement by Representative Bart Gordon, Chair, Committee on 
  Science and Technology, U.S. House of Representatives..........     7
    Written Statement............................................     7

Statement by Representative Ralph M. Hall, Minority Ranking 
  Member, Committee on Science and Technology, U.S. House of 
  Representatives................................................     8
    Written Statement............................................    10

Prepared Statement by Representative Jerry F. Costello, Member, 
  Committee on Science and Technology, U.S. House of 
  Representatives................................................    11

Prepared Statement by Representative Russ Carnahan, Member, 
  Committee on Science and Technology, U.S. House of 
  Representatives................................................    11

Prepared Statement by Representative Harry E. Mitchell, Member, 
  Committee on Science and Technology, U.S. House of 
  Representatives................................................    12

Prepared Statement by Representative Charles A. Wilson, Member, 
  Committee on Science and Technology, U.S. House of 
  Representatives................................................    12

Prepared Statement by Representative Mario Diaz-Balart, Member, 
  Committee on Science and Technology, U.S. House of 
  Representatives................................................    13

                                Witness:

Dr. Steven Chu, Secretary of Energy, U.S. Department of Energy
    Oral Statement...............................................    14
    Written Statement............................................    16
    Biography....................................................    19

Discussion
  ARPA-E.........................................................    19
  Coordinating Carbon Capture and Sequestration..................    21
  The Ultra Deepwater and Unconventional Natural Gas and Other 
    Petroleum Resources Research Program.........................    23
  Standards and Inter-operability for Cap-and-Trade and Smart 
    Grid.........................................................    25
  Peak Oil and Security Concerns.................................    27
  ARRA, Ocean Acidification, and Consumer Behavior...............    28
  Nuclear Energy and Waste Reprocessing..........................    30
  Solar Energy...................................................    32
  More on Nuclear Energy.........................................    33
  Biofuels.......................................................    35
  DOE Loan Guarantee Program.....................................    35
  Corn-based Ethanol.............................................    37
  The Economics of Emissions Trading.............................    38
  Saving Energy in Industry......................................    39
  Program Comments...............................................    40
  Coal-to-Liquid Technology......................................    41
  Skepticism of Global Climate Change............................    43
  Nuclear and Space-based Solar Energy...........................    44
  Plans for Research and Development Collaboration...............    45
  More Climate Change Denial.....................................    47
  Electric Vehicles and Batteries................................    48
  More on Emissions Trading......................................    50
  Battery Development and Advancing Efficiency...................    52
  Alternative Emissions Pricing Structures.......................    53
  Fusion Energy..................................................    54
  Closing........................................................    55

              Appendix: Answers to Post-Hearing Questions

Dr. Steven Chu, Secretary of Energy, U.S. Department of Energy...    58


    NEW DIRECTIONS FOR ENERGY RESEARCH AND DEVELOPMENT AT THE U.S. 
                          DEPARTMENT OF ENERGY

                              ----------                              


                        TUESDAY, MARCH 17, 2009

                  House of Representatives,
                       Committee on Science and Technology,
                                                    Washington, DC.

    The Committee met, pursuant to call, at 10:03 a.m., in Room 
2318 of the Rayburn House Office Building, Hon. Bart Gordon 
[Chair of the Committee] presiding.

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

                            hearing charter

                  COMMITTEE ON SCIENCE AND TECHNOLOGY

                     U.S. HOUSE OF REPRESENTATIVES

                       New Directions for Energy

                    Research and Development at the

                       U.S. Department of Energy

                        tuesday, march 17, 2009
                         10:00 a.m.-12:00 p.m.
                   2318 rayburn house office building

PURPOSE

    On Tuesday, March 17, 2009, the Committee on Science and Technology 
will hold a hearing entitled ``New Directions for Energy Research and 
Development at the U.S. Department of Energy.'' The purpose of the 
hearing is to receive testimony on the Administration's near-term 
objectives and priority issues for the research and development (R&D) 
activities under the Offices of Science, Energy Efficiency and 
Renewable Energy, Fossil Energy, Nuclear Energy, Electricity Delivery 
and Energy Reliability, and the Loan Guarantee Program. The discussion 
will also focus on the Department's plans for spending the funds 
allocated under both the American Recovery and Reinvestment Act of 2009 
and the Fiscal Year 2009 Omnibus Appropriations Act. Finally, Secretary 
Chu will address some features of the Department's organization that 
impede scientific innovation and the remedies being considered to 
address them.

WITNESS

          Dr. Steven Chu, U.S. Secretary of Energy. Prior to 
        his appointment as the 12th Secretary of Energy, Dr. Chu was 
        the Director of DOE's Lawrence Berkeley National Laboratory, 
        and a professor of Physics and Molecular and Cell Biology at 
        the University of California. In 1997 he was the co-winner of 
        the Nobel Prize for Physics.

BACKGROUND

The FY 2010 Budget Request to Congress
    As has been typical of presidential transitions in recent history 
President Obama chose to delay submission of a detailed FY 2010 Budget 
Request and instead released a summary document that provides an 
overview of the President's budget proposals. The three-page excerpt 
for the Department of Energy is attached. Detailed budget documents 
will be transmitted to Congress in April.
    The budget document proposes $26.3 billion for the Department of 
Energy in FY 2010. In recent years the civilian energy R&D programs 
have made up approximately one-third of the total DOE budget, with 
other programs related to nuclear weapons and environmental clean-up 
comprising the rest. Of particular note in this budget is the 
President's commitment to double overall federal funding for basic 
sciences, with significant increases expected for the DOE Office of 
Science. The FY 2009 Omnibus Appropriations bill currently allocates 
$4.8 billion for Office of Science, and the American Recovery and 
Reinvestment Act included $1.6 billion.
    Other Administration priorities listed in the proposal include 
encouraging commercialization of innovative energy technologies through 
the Loan Guarantee Program, developing advanced coal technologies such 
as carbon capture and sequestration, modernizing the Nation's electric 
transmission infrastructure through Smart Grid and storage 
technologies, and promoting the research, development, demonstration 
and deployment of clean energy technologies.
    The budget request is also expected to increase support for 
promising, but exploratory and high-risk research activities with 
potential to deliver radically new technologies, such as those proposed 
to be carried out by the new Advanced Research Projects Agency for 
Energy (ARPA-E). Modeled on a similar program in the Defense 
Department, ARPA-E was authorized in the America COMPETES Act of 2007 
to be a small and nimble organization that conducts such high-risk, 
high-reward energy technology R&D through collaborations between 
government, academia and industry. Together the FY 2009 Omnibus and the 
Recovery Act provide $415 million for start-up and initial operations 
of ARPA-E.

The American Recovery and Reinvestment Act of 2009
    The American Recovery and Reinvestment Act allocated approximately 
$39 billion to DOE. The bulk of this is dedicated to making the country 
more efficient through activities such as weatherization of low-income 
homes, retrofitting federal facilities, and implementation of State and 
local efficiency programs. In addition to the funds mentioned above for 
the Office of Science and ARPA-E, a significant amount was provided for 
next generation energy technologies through DOE's applied energy R&D 
programs.
    Of the funds allocated for the Office of Energy Efficiency and 
Renewable Energy (EERE), the Recovery Act specified $2.5 billion for 
R&D. Of that amount, $800 million is directed to biomass, $400 million 
to geothermal, and the remainder is to be directed amongst the other 
R&D programs including: wind, solar, hydrogen, vehicle technologies, 
industrial technologies, and energy efficiency. An additional $2 
billion is directed to grants for advanced battery manufacturing.
    The Office of Electricity Delivery and Energy Reliability (OE or 
EDER) receives approximately $4.5 billion to modernize the electric 
transmission infrastructure through deployment of smart grid and energy 
storage technologies. The Office of Fossil Energy is allocated $3.4 
billion for the development of technologies to capture and sequester 
carbon dioxide. Finally, the Innovative Technology Loan Guarantee 
Program authorized in EPAct 2005 receives $6 billion, most of which is 
to be devoted to rapid deployment of proven clean energy technologies.
    The Recovery Act represents an unprecedented one-time increase in 
funding for DOE. Effective use of Recovery Act funding requires DOE to 
transfer the funds to the appropriate government and private sector 
entities in a timely manner and with an appropriate level of 
transparency and accountability. The Inspector General's office at DOE 
and the Government Accountability Office are allocated additional funds 
in the Recovery Act to provide additional oversight of these 
expenditures.

Organizational Challenges at the Department of Energy
    The priorities and mission of the Department of Energy have shifted 
over time. Roughly two-thirds of the Department's budget is still 
devoted to the production and maintenance of the Nation's nuclear 
weapons stockpile and clean-up of the environmental legacy of weapons 
production dating from its history with the Manhattan Project and its 
parent organization, the Atomic Energy Commission. The remaining third 
of the budget is devoted to a wide array of basic and applied energy 
research and development activities that are managed currently by two 
Under Secretaries, four Assistant Secretaries, and two Directors. It 
has been argued that DOE's stove-piped organization and management of 
its laboratory system have led to operational inefficiencies and poor 
coordination across the Departments research programs. A number of 
solutions have been proposed over the years to streamline operations 
and ensure transparency and accountability while fostering innovation.
    One proposal is to place all civilian R&D programs under the 
authority of the Under Secretary for Science for the purpose of 
improving coordination and management of DOE's energy research, 
development, and demonstration programs. Currently, one Under Secretary 
is responsible for applied energy R&D as well as Environmental 
Management, Legacy Management, and Civilian Radioactive Waste 
Management. The Under Secretary for Science is responsible for basic 
research activities conducted by the Office of Science. The current 
division of authority over these programs does not facilitate 
development of a comprehensive, consistent strategy for translating 
basic research discoveries into technological applications. Realignment 
would allow one Under Secretary to focus on all energy research and 
technology development programs, while the other focuses on important 
environmental stewardship programs.
    Another proposal involves using external agencies to regulate DOE's 
laboratories. DOE is unique in maintaining a large internal bureaucracy 
to regulate its own environmental, safety, and health performance. 
Applying external regulatory oversight to DOE's laboratories would 
reduce costs and remove inherent conflicts of interest by transferring 
DOE's worker safety compliance role to the Occupational Safety and 
Health Administration (OSHA) and the nuclear safety compliance role to 
the Nuclear Regulatory Commission (NRC).

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

    Chair Gordon. This meeting will come to order. Good morning 
and welcome everyone. I am very pleased to have our new 
Secretary of Energy, Dr. Steven Chu, here to testify this 
morning on the new directions of the energy research at the 
Department of Energy.
    As a preview to the more detailed budget proposal we will 
see from the Administration in April, this hearing provides an 
opportunity for Secretary Chu to discuss the Administration's 
priorities for energy research and development.
    The Department has a critical task ahead in energy and 
climate research and technology development.
    And make no mistake. At this time, gas prices may be low 
and the effects of climate change may not be apparent to 
everyone, but this will not last. We must take action now to 
become a cleaner, more efficient energy economy. To do this we 
must diversify our sources of energy by expanding the use of 
renewable energy and by using fossil resources more cleanly and 
efficiently.
    I believe that nuclear energy will also be a part of this 
equation, but I have concerns about the management of its 
waste. And Dr. Chu, this committee stands ready to work with 
you to develop the appropriate R&D path forward for that 
disposal concern.
    As a key member of the National Academies' Gathering Storm 
panel, Dr. Chu was intimately involved in laying the groundwork 
for the Advanced Research Projects Agency for Energy, or ARPA-
E. As you know, this passed by an overwhelming, bipartisan 
support out of this committee. This committee will continue to 
work with the Secretary to ensure its success. I look forward 
to hearing about the status of the ARPA-E start-up.
    The $39 billion allocated to DOE in the Recovery Act funds 
a wide range of activities spanning the innovation spectrum 
from basic research to supporting the market for new energy 
technologies. It also presents a historic opportunity to put 
people to work building a more sustainable future for the 
country. However, when it comes to the taxpayer money, we must 
work together to ensure these funds are spent wisely.
    In this hearing we will have only a few brief opportunities 
to cover a range of issues, but I consider this the beginning 
of a productive partnership with Secretary Chu. Dr. Chu, I look 
forward to your testimony, and I thank you for appearing before 
the Committee this morning.
    And now, the Chair recognizes Mr. Hall for an opening 
statement.
    [The prepared statement of Chair Gordon follows:]
                Prepared Statement of Chair Bart Gordon
    Good morning and welcome. I am very pleased to have our new 
Secretary of Energy, Dr. Steven Chu here to testify this morning on the 
new directions for energy research at the Department of Energy.
    As a preview to the more detailed budget proposal we will see from 
the Administration in April, this hearing provides an opportunity for 
Secretary Chu to discuss the Administration's priorities for energy 
research and development.
    The Department has a critical task ahead in energy and climate 
research and technology development.
    Make no mistake. At this time, gas prices may be low and the 
effects of climate change may not be apparent to everyone, but this 
will not last. We must take action now to become a cleaner, more 
efficient energy economy. To do this we must diversify our sources of 
energy by expanding the use of renewable energy and using fossil 
resources more cleanly and efficiently.
    I believe that nuclear energy will also be a part of this equation, 
but I have concerns about management of its waste.
    Dr. Chu, this committee stands ready to work with you to develop 
the appropriate R&D path forward for waste disposal.
    As a key member of the National Academies' Gathering Storm panel, 
Dr. Chu was intimately involved in laying the groundwork for the 
Advanced Research Projects Agency for Energy or ARPA-E. This committee 
will continue to work with the Secretary to ensure its success. I look 
forward to hearing about the status of ARPA-E start-up.
    The $39 billion dollars allocated to DOE in the Recovery Act funds 
a wide range of activities spanning the innovation spectrum from basic 
research to supporting the market for new energy technologies.
    It also presents a historic opportunity to put people to work 
building a more sustainable future for the country. However, when it 
comes to the taxpayers' money we must work together to ensure these 
funds are spent wisely.
    In this hearing we will have only a brief opportunity to cover a 
range of critical issues. But I consider this the beginning of a 
productive partnership with Secretary Chu.
    Dr. Chu, I look forward to your testimony, and I thank you for 
appearing before the Committee this morning.

    Mr. Hall. Mr. Chairman, I do thank you for holding this 
hearing today, and I would like to extend my welcome to 
Secretary Chu. It is good to have you here, and I look forward 
to working with you as we continue to tackle our energy 
challenges, and there are quite a few of them.
    I am pleased to see the level of commitment in the 
President's budget supporting research and development in the 
important fields of renewable energy and basic energy. As we 
all know, renewable energy is going to be an important and 
necessary part of the energy portfolio as we go forward with 
the dual goals of energy independence and a clean environment. 
I am also pleased that the President's budget contained a boost 
toward developing low-carbon coal technologies. I have always 
been supportive of using this very abundant domestic resource 
for providing our country's energy needs. With widespread 
commercial use of carbon capture and sequestration technology, 
our country can hopefully have the option of replacing imports 
of oil and gas with coal-to-liquids fuels and methane gas from 
coal.
    What I haven't seen or heard is what the plans are for oil 
and gas research and development going forward. I believe in 
the ``all-of-the-above'' answer to our energy problems, and 
that includes using domestic sources of oil and natural gas. 
Research and development in these fields does not benefit the 
major oil companies, but it does benefit the small independent 
oil and gas producers who should be helped in their efforts to 
bring our domestic supplies to the market rather than penalized 
at every step. I am very disappointed that the President 
recommended that the Ultra Deepwater and Unconventional Natural 
Gas and Other Petroleum Research program be repealed. The prior 
Administration made this recommendation as well as Congress, 
and Congress has repeatedly said to the President and to the 
prior administration, you are wrong, and we funded this 
valuable program anyway. I like George Bush, and I flew west 
with him to sign the bill that included this provision in it 
and usually they turn and hand the pencil to someone. All he 
said was, Ralph Hall is with me, because he just wanted some 
coffee from Air Force One. What he didn't know was I had five 
of his cups in my briefcase at that time.
    But the Ultra Deep Program is paid for by the federal lease 
royalties, rents, and bonuses paid by oil and gas companies, 
not taxpayers, and it will make the government more money in 
the long run as the resulting research and development will 
lead to increased royalties, rents, and bonuses paid by oil and 
gas companies. And Mr. Chairman, in order to stress the 
importance of this issue, I would ask to include this document 
with highlights from the RPSEA Project Portfolio in the record.
    Chair Gordon. With no objection, this will be made part of 
the record.
    [The information follows:]
                Highlights from RPSEA Project Portfolio
Optimization of Infill Well Locations in Wamsutter Field; University of 
Tulsa, $440,000 for 36 months. This project represents an example of 
the application of new technology to increase the gas recovery from an 
existing field. Additional gas that is produced from existing fields 
using existing infrastructure diminishes the need for development in 
new, environmentally sensitive areas.

Novel Concepts for Unconventional Gas Development in Shales, Tight 
Sands and Coal Beds; Carter Technologies, $91,000 for 12 months. Carter 
Technologies is a small, entrepreneurial company that was funded by 
RPSEA to evaluate novel concepts for increasing the contact between a 
gas well and the associated reservoir. These concepts have the 
potential to provide an easier to control alternative to hydraulic 
fracturing, and could decrease the water use associated with 
unconventional gas development.

Petrophysical Studies of Unconventional Gas Reservoirs Using High-
Resolution Rock Imaging; Lawrence Berkeley Laboratory, $1,100,000 for 
36 months. The storage and movement of fluids, including natural gas, 
through the pore spaces of extremely fine-grained shale reservoirs 
requires different models and predictive tools than those developed 
over the last 50+ years for conventional reservoirs. This project is 
intended to make fundamental pore-scale investigations of shale 
reservoir properties, resulting in the physical understanding necessary 
to develop the models that will be crucial for effective decision-
making regarding the planning and execution of the development of shale 
gas resources.

Comprehensive Investigation of the Biogeochemical Factors Enhancing 
Microbially Generated Methane in Coal Beds; Colorado School of Mines, 
$860,000 for 24 months. Methane present in coal beds may have been 
generated over very long time scales. This project is investigating the 
potential for microbially accelerating the generation of methane from 
coal, potentially leading to the conversion of coal to much cleaner 
methane.

Field Site Testing of Low-Impact Oil Field Access Roads: Reducing the 
Footprint in Desert Ecosystems; Texas A&M University, $444,939 for 24 
months. The roads required to provide access to drilling sites have an 
impact on ecosystems lasting beyond the time that the roads are in use. 
This project is testing concepts for temporary roads that would be 
removable with minimal long-term impact on the ecosystem. Such road 
systems may find application in any system where the need for access 
for a short time (e.g., for construction) is greater than the need for 
long-term access in sensitive ecosystems.

Work that would be done if additional funding was available: Natural 
gas in shale formations represents a potentially very large domestic 
resource that could provide clean hydrocarbon fuels to help manage the 
transition to an entirely sustainable energy economy. Both policy 
decisions and investment decisions regarding this resource require 
better knowledge of the magnitude of the resource and the technical 
challenges associated with developing it. RPSEA has funded such studies 
in a limited number of areas (Alabama, Utah, Illinois Basin), but such 
resource and basin analysis studies covering the entire domestic shale 
resource base would materially impact the effective and appropriate 
utilization of the resource.

    Mr. Hall. Thank you. I will hand it to him. And I will have 
more to say about this during the question and answer, but I 
just want to urge the Secretary and President Obama to 
reconsider their position on this program. I am also interested 
in hearing about this Administration's decision to move away 
from the idea of storing spent nuclear fuel at the Yucca 
Mountain repository in Nevada and how that decision will or 
will not affect the current application for new plants and the 
future of nuclear energy in our country. Nuclear energy of 
course is also part of the ``all-of-the-above'' energy solution 
and should be considered a power house in our energy arsenal. 
Out of all of the emissions-free options, it produces the most 
energy and is the most reliable, and I urge the Secretary to 
make sure it remains a part of this mix.
    I look forward to working with you and look forward to your 
testimony and the ensuing discussion on the very important work 
that is being done by the Department of Energy, a department 
that I think is probably the number one department for the 
future of this country and to the position that we are taking 
in trying to produce our own energy and not rely on nations 
that don't really trust us and that we could do without and 
keep those billions of dollars within the confines of the 50 
states. With that, I yield back my time.
    [The prepared statement of Mr. Hall follows:]
           Prepared Statement of Representative Ralph M. Hall
    Mr. Chairman, thank you for holding this hearing today. I'd like to 
extend my welcome to Secretary Chu. It's good to have you here, and I 
look forward to working with you as we continue to tackle our energy 
challenges.
    I am pleased to see the level of commitment in the President's 
budget supporting research and development in the important fields of 
renewable energy and basic energy. As we all know, renewable energy 
will be an important and necessary part of our energy portfolio as we 
go forward with the dual goals of energy independence and a clean 
environment. I am also pleased that the President's budget contained a 
boost towards developing low-carbon coal technologies. I have always 
been supportive of using this abundant domestic resource for providing 
our country's energy needs. With widespread commercial use of carbon 
capture and sequestration technology, our country can hopefully have 
the option of replacing imports of oil and gas with coal-to-liquids 
fuels and methane gas from coal.
    What I haven't seen or heard is what the plans are for oil and gas 
research and development going forward. I believe in the ``all-of-the-
above'' answer to our energy problem, and that includes using domestic 
sources of oil and natural gas. Research and development in these 
fields does not benefit the major oil companies, but it does benefit 
the small independent oil and gas producers who should be helped in 
their efforts to bring our domestic supplies to the market rather than 
penalized at every turn. I am very disappointed that the President 
recommended that the Ultra Deepwater and Unconventional Natural Gas and 
Other Petroleum Research program be repealed. The prior Administration 
made this recommendation as well and Congress repeatedly said ``you're 
wrong'' and funded this valuable program anyway. The Ultra Deep program 
is paid for by federal lease royalties, rents, and bonuses paid by oil 
and gas companies--not taxpayers, and it will make the government more 
money in the long run as the resulting R&D will lead to increased 
royalties, rents, and bonuses paid by oil and gas companies. I will 
have more to say about this during Q&A, but I just want to urge the 
Secretary and President Obama to reconsider their position on this 
program.
    I am also interested in hearing about the Administration's decision 
to move away from the idea of storing spent nuclear fuel at the Yucca 
Mountain repository in Nevada and how that decision will or will not 
affect the current applications for new plants and the future of 
nuclear energy in our country. Nuclear energy is of course also part of 
the ``all-of-the-above'' energy solution and should be considered a 
power house in our energy arsenal. Out of all the emissions-free 
options, it produces the most energy and is the most reliable, and I 
urge the Secretary to make sure it remains a part of the mix.
    I look forward to Secretary Chu's testimony and the ensuing 
discussion on the very important work being done at the Department of 
Energy.

    Chair Gordon. Thank you, Mr. Hall, and I certainly agree 
with you. Dr. Chu, you will find that our committee tries to 
work in collaboration. Everything we got here is bipartisan and 
most often is unanimous. And so we hope to be an asset for you 
in that regard.
    If there are other Members who wish to submit additional 
opening statements, your statements will be added to the record 
at this point.
    [The prepared statement of Mr. Costello follows:]
         Prepared Statement of Representative Jerry F. Costello
    Chairman Gordon, thank you for calling today's hearing on this very 
important topic. Secretary Chu, we appreciate you being with us this 
morning. I look forward to hearing in greater detail your thoughts and 
ideas on how we can be more productive in terms of our energy research 
and development. We want to work with you and President Obama to make 
progress in this area. It is imperative that we work together in a 
bipartisan way to develop clean energy sources for the future while 
simultaneously maximizing the benefits of our fossil energy resources.
    Of course, each of us has particular concerns with how this work 
will proceed. Whether it is how a cap-and-trade regime will work and 
its effects on utility bills across the country, or how to distribute 
our research dollars for maximum impact, there will be disagreements. 
However, I am confident we can come together to make real strides 
toward a cleaner energy future. Importantly, the Obama Administration 
has made a strong early commitment to science, through both funding and 
emphasizing its importance to our economy and society, and this has 
been well received.
    As I have discussed with you before, I come from a state with large 
coal reserves and I want to develop ways to use it as cleanly as 
possible. We really have no choice, as over half of our electricity 
comes from coal. One of my singular disappointments from the Bush 
Administration, as we discussed in the Energy and Environment 
Subcommittee again last week, was its decision to walk away from the 
FutureGen Project, which not only dealt a blow to bipartisanship, but 
set our efforts back to develop carbon sequestration by as much as a 
decade. I will have questions regarding your thoughts on FutureGen 
going forward, but offer it up as example of how we can work together 
on an important project that serves the energy needs of our entire 
nation.
    I mentioned cap-and-trade earlier, and while I know that all of the 
details of the Administration's plan have yet to be released, I will be 
interested to hear your thoughts on this concept. We need to be very 
careful about how such a plan is constructed, as the economic 
dislocations of too much, too soon, could be very severe.
    A further point I will ask about is the regulation of DOE's 
laboratories. I have sponsored legislation in the past to have this 
function done externally, and, given your strong background in this 
area, am very interested to hear your thoughts on this issue and if it 
is a concept you are interested in pursuing.
    Mr. Chairman, thank you again for your attention to these issues 
and for your leadership. I am excited to begin our work with Secretary 
Chu and anticipate a great working relationship.

    [The prepared statement of Mr. Carnahan follows:]
           Prepared Statement of Representative Russ Carnahan
    Chairman Gordon, Ranking Member Hall, thank you for hosting this 
important hearing on ``New Directions for Energy Research and 
Development at the U.S. Department of Energy.'' Secretary Chu, thank 
you for appearing before the Committee. I look forward to working with 
you over the course of the 111th Congress and beyond to address the 
Nation's critical challenges relating to energy.
    As co-founder of the Congressional High-Performance Buildings 
Caucus, I am particularly interested in the Department of Energy's 
plans for promoting energy efficiency in the built environment. As you 
know, our homes, offices, schools, and other buildings consume 40 
percent of the primary energy and 70 percent of the electricity in the 
U.S. annually. These buildings also account for 39 percent of U.S. 
CO2 emissions each year. With over $15 billion allocated in 
the Stimulus Bill to weatherizing the homes of low-income families, 
``greening'' federal buildings and to State and local efficiency 
programs, the DOE has the crucial responsibility of ensuring that this 
investment is spent wisely.
    Going forward, investing in high-performance buildings must be a 
long-term priority. I am particularly encouraged by DOE's Building 
Technologies Program. Mr. Secretary, I am curious to hear your thoughts 
on how this important initiative can reach its strategic goals of 
developing the technologies and designs for zero-energy homes and 
commercial buildings by 2020 and 2025, respectively. I am also pleased 
to see your plans for transformational research into computer design 
tools that will lead to energy consumption reductions of up to 80 
percent. I am also interested to know your views on the role of 
Congress in supporting the continued adoption of green building 
practices across the United States.
    As a Member of the Subcommittee on Research and Science Education, 
I share your commitment to developing the next generation's science and 
engineering talent. I look forward to collaborating with you to 
increase funding for basic research while ensuring that taxpayer 
dollars are spent effectively.
    In closing, thank you again, Chairman Gordon, for calling this 
important hearing. Secretary Chu, I look forward to your testimony.

    [The prepared statement of Mr. Mitchell follows:]
         Prepared Statement of Representative Harry E. Mitchell
    Thank you, Mr. Chairman.
    Today we will discuss the Energy Department's near-term objectives 
and priority issues for research and development activities.
    I look forward to hearing from the Secretary of Energy, Dr. Steven 
Chu, about research and development activities for clean energy 
technologies.
    With over 300 days of sunshine a year in Arizona, I strongly 
believe that we have an opportunity to brighten America's future by 
investing in solar energy research and development. Investing in solar 
energy will not only help to reduce our nation's dependence on foreign 
oil, it will also create jobs and help spur economic growth.
    In Arizona, we've seen how the advancement of solar energy research 
can lead to the development of large-scale solar opportunities. Arizona 
Public Service and Abengoa Solar are developing the world's largest 
solar plant outside of Gila Bend. The Solana solar generating station 
will create 1,500 to 2,000 jobs and provide clean, emission-free energy 
for 70,000 homes. Solana is expected to ultimately spur $1 billion in 
economic development.
    I look forward to hearing from Dr. Chu about his priorities for the 
Department of Energy.
    I yield back.

    [The prepared statement of Mr. Wilson follows:]
         Prepared Statement of Representative Charles A. Wilson
    Thank you, Mr. Chairman, for holding this important hearing. I 
appreciate having the opportunity to participate this morning.
    Secretary Chu, I would like to welcome you to the Committee this 
morning; I look forward to hearing your views on our nation's energy 
research and development efforts. In addition, I look forward to 
hearing your views regarding coal and the important role it will play 
as we begin the transition to a low-carbon economy.
    As all of you here today know, coal is our nation's most abundant 
resource and it must play a role in bridging the gap to our energy 
future. Today, coal serves as the single largest fuel source for the 
generation of electricity worldwide, and is essential to the U.S. 
economy. Everyday, coal provides affordable and reliable energy to 
millions of households, businesses, and manufacturing facilities 
throughout our nation. Furthermore, in my home State of Ohio and around 
this country, coal is not only a valuable source of electricity, but it 
is a valuable source of jobs. The Ohio coal industry directly employs 
over 3,000 individuals each year.
    Today, America is in the midst of a long-term energy crisis. And as 
the climate change debate continues to intensify in Congress, we must 
find ways to balance our nation's energy, economic and environmental 
needs. We are all excited about the future of alternative energy and 
the idea of weaning ourselves off foreign resources, but we must be 
realistic about the short-term needs that an energy intense nation will 
require. We cannot disregard an important ``home-grown'' resource like 
coal that we already have in abundance.
    As Congress moves forward on this important issue, clean coal 
technology and carbon capture and sequestration technology must play a 
key role. The $3.4 billion for clean coal technologies including carbon 
capture and sequestration provided in the American Recovery and 
Reinvestment Act is a good step, but more must be done. It is important 
that Congress and the Department of Energy continue to invest in this 
vital technology so that as a nation we can truly reduce greenhouse gas 
emissions and move toward energy independence.
    I look forward to hearing your testimony today Secretary Chu and 
look forward to working together in the future.

    [The prepared statement of Mr. Diaz-Balart follows:]
         Prepared Statement of Representative Mario Diaz-Balart
    It is clear that the Administration's cap-and-trade proposal is a 
deeply flawed and economically damaging plan that calls for increasing 
taxes on everyday energy use, burdening Americans at the gas pump and 
as they struggle to pay monthly electricity bills. Hardworking 
families, small businesses, and manufacturers cannot afford this 
massive new tax increase.
    Today, the Associated Press reported, in an article included below, 
that China's lead climate negotiator said any fair international 
agreement to curb gases blamed for global warming would not require 
China to reduce emissions caused by manufactured goods intended to be 
exported.
    I strongly agree with the Energy Secretary that all nations, 
including China, must work to limit their carbon emissions. The 
Administration should not proceed with a climate change proposal that 
could damage the American economy particularly when the Chinese refuse 
to take meaningful reforms to reduce their carbon emissions.

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


    Chair Gordon. Dr. Chu, we normally ask our witnesses to 
limit their testimony to five minutes. However, since you are 
the only person on the panel and the star of the show, we don't 
want to limit you. We are interested in hearing your plans and 
how you want to take the Department of Energy into the future, 
and so at this time, please begin.

    STATEMENT OF DR. STEVEN CHU, SECRETARY OF ENERGY, U.S. 
                      DEPARTMENT OF ENERGY

    Dr. Chu. Thank you. Chairman Gordon, Ranking Member Hall, 
Members of the Committee, thank you for the opportunity to 
appear before you today to talk about the New Directions for 
Energy Research and Development at the U.S. Department of 
Energy.
    Today, we import roughly 60 percent of our oil, draining 
resources from our economy and leaving it vulnerable to supply 
disruptions. Much of that oil is controlled by regimes that do 
not share our values, weakening our security. Additionally, if 
we continue our current rates of greenhouse gas emissions, the 
consequences of our climate could be disastrous.
    In the near-term, President Obama and this Congress have 
already taken a key step toward meeting these challenges by 
passing the American Recovery and Reinvestment Act of 2009. 
This legislation will put Americans back to work while laying 
the groundwork for a clean energy economy.
    Getting this money into the economy quickly, carefully, and 
transparently is a top priority for me. I know that your 
constituent states, cities, and businesses are eager to move 
forward, and are seeking more information about how to access 
this funding. I have met with many of them already, and we will 
have much more detail in the coming weeks.
    With that introduction, I would like to turn to a topic 
that is near and dear to my heart: how can we better nurture 
and harness science to solve our energy and climate change 
problems? I have spent most of my career in research labs as a 
student, as a researcher, a faculty member. I took on the 
challenge of being Secretary of Energy in part for the chance 
to ensure that the Department of Energy Laboratories and our 
country's universities will generate ideas that will help us 
address our energy challenges. I also strongly believe that the 
key to our prosperity in the 21st century lies in our ability 
to nurture our intellectual capital in science and engineering. 
Our previous investments in science led to the birth of the 
semiconductor, computer, and bio-technology industries that 
have added greatly to our economic prosperity. Now, we need 
similar breakthroughs on energy.
    We are already taking steps in the right direction, but we 
need to do more. First, we need to increase funding. As part of 
the President's plan to double federal investment in the basic 
sciences, the 2010 budget provides substantially increased 
support for the Office of Science, building on the $1.6 billion 
provided in the Recovery Act for the Department of Energy's 
basic sciences programs.
    We also need to refocus our scarce research dollars. In 
April, a more detailed fiscal year 2010 budget will be 
transmitted to Congress. This budget will improve energy 
research, development, and deployment at DOE in several ways. 
First, we need to develop science and engineering talent. The 
fiscal year 2010 budget supports graduate fellowship programs 
that will train students in energy-related fields. I will also 
seek to build on the DOE's existing research strengths by 
attracting and retaining the most talented scientists.
    The second area I want to discuss is the need to support 
transformational research. What do I mean by transformational 
technology? I mean technology that is game-changing, as opposed 
to merely incremental. For example, in the 1920s and '30s, when 
Bell Laboratories was focused on extending the life of vacuum 
tubes, another much smaller research program was started to 
investigate a completely new device based on a revolutionary 
new advance in the understanding of the microscopic world, 
quantum mechanics. The result of this transformational research 
was the transistor, which transformed communications, allowed 
the computer industry to blossom, and changed the world 
forever.
    DOE must strive to be the modern version of the old Bell 
Labs in energy research. Because the payoffs from research in 
transformational technologies are both higher risk and longer-
term, government investment is critical and appropriate. We are 
already funding this type of research in biofuels. As this 
committee knows, we have funded three bioenergy research 
centers, one at the Oak Ridge National Laboratory, one led by 
the University of Wisconsin in Madison, in collaboration with 
Michigan State University, and one led by Lawrence Berkeley 
National Laboratory. Each of these centers is targeting 
breakthroughs in biofuel technology development that will be 
needed to make abundant, affordable, low-carbon biofuels a 
reality.
    We need to do more transformational research at DOE to 
bring a range of clean energy technologies to the point where 
the private sector can pick them up, including gasoline and 
diesel-like biofuels generated from lumber waste, crop wastes, 
solid waste, and non-food crops; automobile batteries with two 
to three times the energy density that can survive 15 years of 
deep discharges; photovoltaic solar power that is five times 
cheaper than today's technology; computer design tools for 
commercial and residential buildings that will enable 
reductions in energy consumption of up to 80 percent with 
investments that will pay for themselves in less than 10 years; 
and large-scale energy storage systems so that variable 
renewable energy resources such as wind or solar power can 
become base-load power generators.
    This is not a definitive list, or a hard set of technology 
goals, but it gives a sense of the type of technologies and 
benchmarks I think we should be aiming for. We will need 
transformational research to attain these types of goals. To 
make it happen, we will need to re-energize our national labs 
as centers of great science and innovation.
    At the same time, we need to seek innovation wherever it 
can be found. The new Advanced Research Projects Agency-Energy 
will open up research funding to the best minds in the country, 
wherever they may be. ARPA-E will identify technologies with 
potential to become the next generation of revolutionary energy 
systems and products, while it will make a major impact on our 
twin problems of energy security and climate change.
    I want to thank this committee for your leadership in 
championing the creation of ARPA-E. ARPA-E will accomplish its 
mission by funding high-risk, high-payoff R&D, performed by 
industry, academia, not-for-profits, national laboratories, and 
consortia. ARPA-E will bring the DARPA style of 
transformational R&D management to focus on energy problems and 
opportunities. I pledge to you we will have this program up and 
running as soon as possible.
    The third area I would like to discuss is that DOE needs to 
foster better research collaboration, both internally and 
externally. We will better integrate national lab, university, 
and industry research. And we will seek partnerships with other 
nations. For example, increased international cooperation on 
carbon capture and storage technology could reduce both the 
cost and time of developing the range of pre- and post-
combustion technologies that are needed to meet the climate 
challenge.
    Finally, while we work on transformational technologies, 
DOE must also improve its efforts to demonstrate next-
generation technologies and to deploy demonstrated clean energy 
technologies at scale. The loan guarantee program will be 
critical to these efforts by helping to commercialize 
technologies, and the Recovery Act funding for weatherization 
and energy efficiency block grant programs will accelerate the 
deployment of energy efficient technologies.
    So I am excited about the prospect of improving DOE's clean 
energy research, development, and deployment efforts. I thank 
you, and I would be glad to answer your questions at this time.
    [The prepared statement of Dr. Chu follows:]
                    Prepared Statement of Steven Chu
    Chairman Gordon, Ranking Member Hall, and Members of the Committee, 
thank you for the opportunity to appear before you today to talk about 
new directions for energy research and development at the Department of 
Energy.
    Today, we import roughly 60 percent of our oil, draining resources 
from our economy and leaving it vulnerable to supply disruptions. Much 
of that oil is controlled by regimes that do not share our values, 
weakening our security. Additionally, if we continue our current rates 
of greenhouse gas emissions, the consequences for our climate could be 
disastrous.
    If we, our children, and our grandchildren are to prosper in the 
21st century, we must decrease our dependence on oil, use energy in the 
most efficient ways possible, and lower our carbon emissions. Meeting 
these challenges will require both swift action in the near-term and a 
sustained commitment for the long-term to build a new economy, powered 
by clean, reliable, affordable, and secure energy.
    During his recent address to a Joint Session of Congress, President 
Obama reiterated his commitment to reducing our dependence on oil and 
sharply cutting greenhouse gas emissions. I look forward to working 
with others in the Administration and with Members of Congress to meet 
the President's goal of legislation that places a market-based cap on 
carbon pollution and drives the production of more renewable energy in 
America. Such legislation will provide the framework for transforming 
our energy system to make our economy less carbon-intensive, and less 
dependent on foreign oil.
    In the near-term, President Obama and this Congress have already 
taken a key step by passing the American Recovery and Reinvestment Act 
of 2009. This legislation will put Americans back to work while laying 
the groundwork for a clean energy economy.

American Recovery and Reinvestment Act

    I would like to highlight a few of the energy investments in that 
law.
    First, the Recovery Act will put people to work making our homes 
and offices more energy efficient. It includes $5 billion to weatherize 
the homes of low-income families; a $1,500 tax credit to help 
homeowners invest in efficiency upgrades; $4.5 billion to ``green'' 
federal buildings, including reducing their energy consumption; and 
$6.3 billion to implement state and local efficiency and renewable 
programs.
    The Recovery Act also includes $6 billion for loan guarantees and 
more than $13 billion in tax credits and financial assistance 
instruments (grants and cooperative agreements) that may leverage tens 
of billions in private sector investment in clean energy and job 
creation. This will help clean energy businesses and projects to get 
off the ground, even in these difficult economic times. The bill also 
makes investments in key technologies, such as $2 billion in advanced 
battery manufacturing, and $4.5 billion to jump-start our efforts to 
modernize the electric grid. These funds will help us ensure that the 
research investments we have already made will be carried forward to 
the market results and clean energy economy we seek.
    Getting this money into the economy quickly, carefully, and 
transparently is a top priority for me. I know that your constituent 
states, cities, and businesses are eager to move forward, and are 
seeking more information about how to access this funding. I have met 
with many of them already, and we will have much more detail in the 
coming weeks.
    I know the Title XVII loan guarantee program is of great interest 
and concern to this committee. We are already in the process of making 
improvements to this important program that I believe will satisfy many 
of these concerns. We should be in a position to guarantee the first 
loans under this program soon.
    We have put in place a set of processes in the Department to get 
Recovery Act funds out the door quickly to good projects, with an 
unprecedented degree of transparency. This will make a significant down 
payment toward the Nation's energy and environmental policy goals. With 
this Recovery Act spending, we are creating jobs and we are providing 
incentives for private capital to move off the sidelines and back into 
the energy markets.

Reshaping Energy Research, Development, and Deployment

    With that, I would like to turn to a topic that is near and dear to 
my heart: how we can better nurture and harness science to solve our 
energy and climate change problems. I have spent most of my career in 
research labs--as a student, as a researcher, and as a faculty member. 
I took the challenge of being Secretary of Energy in part for the 
chance to ensure that the Department of Energy Laboratories and our 
country's universities will generate ideas that will help us address 
our energy challenges. I also strongly believe that the key to our 
prosperity in the 21st century lies in our ability to nurture our 
intellectual capital in science and engineering. Our previous 
investments in science led to the birth of the semiconductor, computer, 
and bio-technology industries that have added greatly to our economic 
prosperity. Now, we need similar breakthroughs on energy.
    We're already taking steps in the right direction, but we need to 
do more.
    First, we need to increase funding. As part of the President's plan 
to double federal investment in the basic sciences, the 2010 Budget 
provides substantially increased support for the Office of Science, 
building on the $1.6 billion provided in the Recovery Act for the 
Department of Energy's basic sciences programs.
    We also need to refocus our scarce research dollars. In April, a 
more detailed FY 2010 budget will be transmitted to Congress. This 
budget will improve energy research, development, and deployment at 
DOE: by developing science and engineering talent; by focusing on 
transformational research; by pursuing broader, more effective 
collaborations; and by improving connections between DOE research and 
private sector energy companies.
    Developing Science and Engineering Talent: Several years ago, I had 
the honor and privilege of working on the ``Rising Above the Gathering 
Storm'' report of the National Academy of Science. One of the report's 
key recommendations is to step up efforts to educate the next 
generation of scientists and engineers. The FY 2010 budget supports 
graduate fellowship programs that will train students in energy-related 
fields. I will also seek to build on DOE's existing research strengths 
by attracting and retaining the most talented scientists.
    Focusing on Transformational Research: The second area that I want 
to discuss is the need to support transformational technology research. 
What do I mean by transformational technology? I mean technology that 
is game-changing, as opposed to merely incremental. For example, in the 
1920's and 1930's, when AT&T Bell Laboratories was focused on extending 
the life of vacuum tubes, another much smaller research program was 
started to investigate a completely new device based on a revolutionary 
new advance in the understanding of the microscopic world: quantum 
physics. The result of this transformational research was the 
transistor, which transformed communications, allowed the computer 
industry to blossom, and changed the world forever.
    DOE must strive to be the modern version of the old Bell Labs in 
energy research. Because the payoffs from research in transformational 
technologies are both higher risk and longer-term, government 
investment is critical and appropriate.
    Here is an example of current DOE transformational research. As 
this committee knows, we have funded three BioEnergy Research Centers--
one at the Oak Ridge National Laboratory in Oak Ridge, Tennessee; one 
led by the University of Wisconsin in Madison, Wisconsin, in close 
collaboration with Michigan State University in East Lansing, Michigan; 
and one led by the Lawrence Berkeley National Laboratory. Each of these 
centers is targeting breakthroughs in biofuel technology development 
that will be needed to make abundant, affordable, low-carbon biofuels a 
reality. While these efforts are still relatively new, they are already 
yielding results, such as the bioengineering of yeasts that can produce 
gasoline-like fuels, and the development of improved ways to generate 
simple sugars from grasses and waste biomass.
    We need to do more transformational research at DOE to bring a 
range of clean energy technologies to the point where the private 
sector can pick them up, including:

        1.  Gasoline and diesel-like biofuels generated from lumber 
        waste, crop wastes, solid waste, and non-food crops;

        2.  Automobile batteries with two to three times the energy 
        density that can survive 15 years of deep discharges;

        3.  Photovoltaic solar power that is five times cheaper than 
        today's technology;

        4.  Computer design tools for commercial and residential 
        buildings that enable reductions in energy consumption of up to 
        80 percent with investments that will pay for themselves in 
        less than 10 years; and

        5.  Large scale energy storage systems so that variable 
        renewable energy sources such as wind or solar power can become 
        base-load power generators.

    This is not a definitive list, or a hard set of technology goals, 
but it gives a sense of the types of technologies and benchmarks I 
think we should be aiming for. We will need transformational research 
to attain these types of goals. To make it happen, we will need to re-
energize our national labs as centers of great science and innovation.
    At the same time, we need to seek innovation wherever it can be 
found--the new Advanced Research Projects Agency-Energy (ARPA-E) will 
open up research funding to the best minds in the country, wherever 
they may be. ARPA-E will identify technologies with the potential to 
become the next generation of revolutionary energy systems and 
products, which will make a major impact on our twin problems of energy 
security and climate change.
    I want to thank this committee for your leadership in championing 
the creation of ARPA-E. ARPA-E will accomplish its mission by funding 
high-risk, high-payoff R&D, performed by industry, academia, not-for-
profits, national laboratories, and consortia. ARPA-E will bring the 
DARPA style of transformational R&D management to focus on energy 
problems and opportunities. I pledge to you we will have this program 
up and running as soon as possible.
    Broader, More Effective Collaboration: DOE also needs to foster 
better research collaboration, both internally and externally. My goal 
is nothing less than to build research networks within the Department, 
across the government, throughout the Nation, and around the globe. 
We'll better integrate national lab, university, and industry research. 
And we will seek partnerships with other nations. For example, 
increased international cooperation on carbon capture and storage 
technology could reduce both the cost and time of developing the range 
of pre- and post-combustion technologies needed to meet the climate 
challenge.
    Speeding Demonstration and Deployment: While we work on 
transformational technologies, DOE must also improve its efforts to 
demonstrate next-generation technologies and to help deploy 
demonstrated clean energy technologies at scale. The loan guarantee 
program will be critical to these efforts by helping to commercialize 
technologies, and the Recovery Act funding for weatherization and 
energy efficiency block grant programs will accelerate the deployment 
of energy efficient technologies.

Conclusion

    I am excited about the prospect of improving DOE's clean energy 
research, development, and deployment efforts. The Nation needs better 
technologies to fully meet our climate and energy challenges, and DOE 
can be a major contributor to this effort.
    We already have ample technology to make significant, near-term 
progress toward our energy and climate change goals. The most important 
of these is energy efficiency, which will allow us to reduce costs and 
conserve resources while still providing the same energy services. The 
potential there is huge, as is the potential to increase the use of 
existing technologies such as wind, solar, and nuclear. We will move 
forward on all of these fronts and more, as we invest in the 
transformational research to achieve breakthroughs that could 
revolutionize our nation's energy future.
    Thank you. I would be glad to answer your questions at this time.

                        Biography for Steven Chu
    Dr. Steven Chu, distinguished scientist and co-winner of the Nobel 
Prize for Physics (1997), was appointed by President Obama as the 12th 
Secretary of Energy and sworn into office on January 21, 2009.
    Dr. Chu has devoted his recent scientific career to the search for 
new solutions to our energy challenges and stopping global climate 
change--a mission he continues with even greater urgency as Secretary 
of Energy. He is charged with helping implement President Obama's 
ambitious agenda to invest in alternative and renewable energy, end our 
addiction to foreign oil, address the global climate crisis and create 
millions of new jobs.
    Prior to his appointment, Dr. Chu was Director of DOE's Lawrence 
Berkeley National Lab, and professor of Physics and Molecular and Cell 
Biology at the University of California. He successfully applied the 
techniques he developed in atomic physics to molecular biology, and 
since 2004, motivated by his deep interest in climate change, he has 
recently led the Lawrence Berkeley National Lab in pursuit of new 
alternative and renewable energies. Previously, he held positions at 
Stanford University and AT&T Bell Laboratories.
    Professor Chu's research in atomic physics, quantum electronics, 
polymer and biophysics includes tests of fundamental theories in 
physics, the development of methods to laser cool and trap atoms, atom 
interferometry, and the manipulation and study of polymers and 
biological systems at the single molecule level. While at Stanford, he 
helped start BioX, a multi-disciplinary initiative that brings together 
the physical and biological sciences with engineering and medicine.
    Secretary Chu is a member of the National Academy of Sciences, the 
American Philosophical Society, the Chinese Academy of Sciences, 
Academica Sinica, the Korean Academy of Sciences and Technology and 
numerous other civic and professional organizations. He received an 
A.B. degree in mathematics, a B.S. degree in physics from the 
University of Rochester, a Ph.D. in physics from the University of 
California, Berkeley as well as honorary degrees from 10 universities. 
Chu was born in Saint Louis, Missouri on February 28, 1948. He is 
married to Dr. Jean Chu, who holds a D.Phil. in Physics from Oxford and 
has served as Chief of Staff to two Stanford University Presidents as 
well as Dean of Admissions. Secretary Chu has two grown sons, Geoffrey 
and Michael, by a previous marriage.
    In announcing Dr. Chu's selection on December 15, 2008, President 
Obama said, ``the future of our economy and national security is 
inextricably linked to one challenge: energy . . . Steven has blazed 
new trails as a scientist, teacher, and administrator, and has recently 
led the Berkeley National Laboratory in pursuit of new alternative and 
renewable energies. He is uniquely suited to be our next Secretary of 
Energy as we make this pursuit a guiding purpose of the Department of 
Energy, as well as a national mission.''

                               Discussion

    Chair Gordon. Thank you, Dr. Chu, and exciting is the right 
term. You have an exciting portfolio, an important portfolio, 
and I wish you the very best of luck.

                                 ARPA-E

    First of all, at this time we will begin questions, and I 
recognize myself for five minutes. As you know, I am eager to 
see ARPA-E established, and I appreciate your comments. In your 
comment you said that you wanted to see it or it would be up 
and running as soon as possible, and I don't doubt your 
commitment. But could you give us a little better idea of some 
kind of rough timeline that you see getting ARPA-E up and 
running and have you assigned a team to serve as any kind of a 
start-up staff? How do you envision ARPA-E coordinating its R&D 
with other programs in the national labs?
    Dr. Chu. I met with a team of people that was trying to see 
what the structure should be like. I think it is very 
consistent with this committee's views. I did ask specifically 
how long it would take. I didn't like the answer. The answer 
was, quite frankly--the first pass answer was one year, and so 
I instructed them, go back, and I want to see exactly on the 
timeline why it would take so long. There might be regulations, 
things like that, and I have not gotten back the answer to 
that.
    So I hope it would take much shorter than one year.
    Chair Gordon. As I had I think mentioned to you earlier, I 
know that DARPA has some programs that are available to pass 
off if you think that those are appropriate. You also received 
$400 million in the Recovery package. You know, how long is 
that going to last and what are your thoughts on spending those 
dollars? How much will that be used toward start-up versus 
actual implementing a program?
    Dr. Chu. Well, we first were already looking around for the 
head of the ARPA-E program. I would hope--again, I was a little 
dismayed by the first pass, why it would take so long. But I 
think we are going to do things simultaneously. We are 
discussing drafting requests for proposals, so even as we 
search for a director and the key personnel, and so because it 
is part of the economic recovery, you know, we want to start 
actually funding projects hopefully in significantly less than 
one year.
    Chair Gordon. Well, I think double or tripling tracking is 
the appropriate way to go. I mean, so often around here we have 
to get through one thing and then the next thing and then the 
next thing, you know. There can be those parallel tracks. There 
is draft legislation in the Senate that includes a provision to 
ensure that all ARPA-E project teams will be industry-led. Do 
you feel this is an appropriate direction to give ARPA-E or 
should it have more flexibility?
    Dr. Chu. I would like it to have more flexibility. 
Certainly having an all-industry led may not be a problem. Just 
as the old ARPA program, it funded universities, it funded 
other research, it funded industries, it funded start-up 
companies, it funded established companies. And really, I would 
like to throw the door open to any and all and just pick the 
best ideas.
    Chair Gordon. I would agree. I think flexibility is the key 
to ARPA-E's success, and you take whatever model is best for 
the particular situation that is before you. Do you have any 
thoughts as to a timeframe on ARPA-E, when it needs to be 
reviewed by the National Academies?
    Dr. Chu. Actually, when it gets reviewed, the best way--in 
my opinion, the best way when you're starting something is to 
look at it very, very early, just in case you feel it is 
getting off the tracks. But the National Academy review has 
certain time constraints, and so I would probably have an 
internal review maybe working with this committee and others in 
Congress within a year to actually see what is going on because 
if it is--long-term things can be avoided if you catch things 
early. And so within a year of the start, the first six months 
you look at the proposals that have been recommended. Are these 
good choices? Are the people in place good people who are 
making the right decisions? And remember that the idea of this 
new funding mechanism is that it is a very small, very select 
group of people that are unconstrained by the usual things, so 
they can really make the best decisions and to focus on those 
three-year time scales. It is not stewardship, it will give you 
money for a very short period of time. After maybe five years, 
that is it. Get it done. And after three to five years, you 
better get some other sponsor. Industry better pick it up or 
something. And actually, nothing focuses the mind like you know 
what, the termination of funding.

             Coordinating Carbon Capture and Sequestration

    Chair Gordon. Sure. Well, you get it, and I am glad that we 
have got you there. In your testimony you say, my goal is 
nothing less than to build research networks within the 
Department, across the government, throughout the Nation, and 
around the globe. This is something that I have an interest in 
since that so many of our major research projects, carbon 
capture and sequestration, things of this nature are going to 
be so expensive, and I think that we live in a world where, you 
know, that is sort of ``them that has got it and them that 
don't.'' And we are in the ``don't'' category to a great 
extent. And so I think it benefits us to collaborate with other 
nations both intellectually as well as financially. And I think 
G8 a while back had a resolution concerning CCS. Can you give 
us some of your thoughts in terms of what are those best areas 
of opportunity for international cooperation, and I would like 
to better understand what that vehicle could be. You know, 
money is going to be involved, and it seems to me that you are 
going to have to have a head-of-state to head-of-state 
agreement and a commitment to provide the funds, but then there 
is also going to have to be some type of an international 
protocol that has got to be set up, a treaty or whatever. What 
are your thoughts? Do we go, each one will be different or is 
there a form for them all?
    Dr. Chu. Okay. So let us start from the basic premise that 
when you build a coal power plant, most of that money is in 
infrastructure. You don't order a coal power plant and put it 
on a boat and ship it, similarly with a building. So when--
first, let me back off and say that we don't actually know 
today what the best technology will be. There are a couple of 
approaches, both pre-combustion and post-combustion capture. 
One thing is for sure, we have to develop some post-combustion 
capture because 99-point something percent of all the coal 
plants are pulverized coal, conventional coal plants. It will 
take some time to prove the technology, say roughly 10 years. 
In the meantime, we will be still building--the world will 
still be building lots of conventional coal plants. So even if 
we develop a pre-combustion strategy going forward, there are 
all those investments in the post-combustion that we have to 
make.
    So there are several strategies that countries are looking 
at. I have been talking with all of the equivalent to the 
energy ministers in various countries. When I say how can we 
share what we know, I mean it in a really intimate way so that 
their engineers and people who are operating the--because they 
are actually there in these pilot programs. It is the lessons 
learned in actually running the thing that is important. That 
is the technical know-how. Because you can't--the IP issue in 
my mind is less important because most of this construction 
will be in the home country, like a building. So I think if we 
have the engineers and the people who are actually there 
learning the actual, real-life experiences as we operate these 
power plants, so if Great Britain wants to build one, if China 
wants to build one, and Denmark wants to build one and we build 
one, we say, okay. This is the menu of things that we need to 
explore. If country X does one, we do another one, and oh, by 
the way, we will have you send over your people so you are 
there with us and learning the lessons in real time, and 
similarly the United States can be over there. It would be 
harder to craft an agreement where money goes overseas, 
especially in these economic times because that money, the 
billions of dollars for example the United States wants to 
spend on these pilot programs, it would be better spent in this 
country because it is part of the economic recovery, and 
similarly in all the other countries. But sharing the technical 
knowledge is something very different. And so you build up a 
common pool of knowledge mostly by being on site and sharing 
those lessons.
    When I talk about that, so far I have gotten a very good 
reception. Now, how you get this crafted into a working 
agreement is really the issue. But right now, now is the time, 
because many countries--Europe is talking about 10 to 12 carbon 
sequestration pilot experiments or pre-commercial plants. We 
are talking of several here in the United States. China is 
talking of at least one. And within a year or so, it will be 
decided what is going to be done. So this is the time to 
actually get those terms.
    Chair Gordon. Do you need any more tools to arrange these 
agreements?
    Dr. Chu. Well, it is mostly as you say partly a State 
Department issue, but it is partly an energy issue. We will 
find out as soon as--I was just meeting with the 
representatives from China and DRC and RDC, one of those two, 
and I was really interested in finding out--we will know what 
we need as soon as we actually start to craft an agreement, an 
actual agreement.
    Chair Gordon. I don't want to take up too much time. Can 
you give me real quickly two or three other prime areas for 
international cooperation energy?
    Dr. Chu. Buildings. The same reason. If you get together 
and try to design for example software tools to help architects 
and structural engineers design an energy-efficient building, 
this is actually pretty sophisticated stuff. We don't 
understand how to design energy efficient buildings, and the 
reason I can say this is when we tried to build a more energy-
efficient building, let us say reducing the energy by 50 
percent, 80 percent, typically we fall short of the design 
goal. The actual performance is less than the design. And if 
you look at a scatter plot the more aggressively we try to 
design an energy-efficient building, the less efficient it 
becomes.
    Chair Gordon. We are going to have to go into the--can you 
just give me the technologies? It is very interesting----
    Dr. Chu. Building efficiency, software design tools.
    Chair Gordon. Okay. Any other areas of international 
cooperation you think would be beneficial?
    Dr. Chu. I think in some of the other things--certainly 
software design tools for building, building efficiency, 
automobile efficiency. But then it gets--there are some issues 
quite frankly that you get into intellectual property (IP) and 
other issues. And so I am looking at those things which are--
the investments will be made in that country, like buildings, 
like power plants where I don't see as much of a barrier.
    Chair Gordon. Thank you, and thank you, Mr. Hall, for your 
patience there and you are recognized.
    Mr. Hall. I am always patient with the Chairman, and I join 
the Chairman in lauding your appointment, not just Democrats 
but some Republicans. Knowing your history, your background, 
and your ability to serve, we are pleased with your 
confirmation, and I think you know that. I also have not been 
able to give our leader the assistance that he would like for 
me to give him on ARPA-E, but it is the law of the land now, 
and I hope that it is going to be as beneficial as Chairman 
Gordon set out in his leadership of its passage, and I 
certainly support working it out for the greatest good for the 
greatest number which is our goal always in what we do here.

     The Ultra Deepwater and Unconventional Natural Gas and Other 
                  Petroleum Resources Research Program

    Mr. Secretary, let me just go right into what I am 
disappointed in. I am disappointed to see that the President's 
fiscal year 2010 budget proposes to terminate the Ultra 
Deepwater and Unconventional Natural Gas and Other Petroleum 
Resources Research program. And I know you are familiar with 
that. It has been passed many times. It has been voted on 
several times by the House and Senate, and it is working. At 
first blush, the proposed termination appears to be part of an 
across-the-board effort to reduce or eliminate federal 
incentives for the domestic oil and gas industry and to 
belittle the importance, belittle the necessity of fossil 
fuels, and I strongly disagree with this policy. Every 
incremental BTU of domestic natural gas is important as every 
additional kilowatt hour of solar energy in terms of reducing 
our dependence on oil imports. Currently 33 percent of domestic 
natural gas production is from coal bed methane in tight 
formations such as shale, all of which is the outgrowth of DOE 
funded R&D in this area.
    However, rather than simply talk about the energy security 
aspects on this issue, I would like to focus on the scientific 
aspects of the Ultra Deepwater and Unconventional Research and 
ask you several specific questions in that regard, sir. First, 
I understand that the Administration's rationale is that this 
research benefits the large domestic oil and natural gas 
producers and that they can otherwise pay for this research, 
and that is why President Bush changed his mind about it in the 
last part of his service and made efforts to repeal it which, 
once again, the House and the Congress rejected and supported 
this program. I am very sincere with you on that, and I really 
want to talk with you later on it. I spent a lot of time with 
the previous Secretary of Energy, and he was operating under a 
situation of where the President wasn't really for it in the 
last analysis, but he remained true to the oath he took and 
worked well with us. I respected the support of the person that 
appointed him, as I do you. These are the things that I want to 
point out. The University of Tulsa received $440,000 for a 36-
month project of Optimization of Infill Well Locations in 
Wamsutter Field to increase production in existing wells, and 
Texas A&M University received $444,969 for a 24-month project 
to field test low-impact oil field access roads to reduce 
environmental footprints in desert areas. Three, the Colorado 
School of Mines received $860,000 for a 24-month program to 
investigate biochemical factors to enhance a generation of 
methane from coal to produce cleaner methane. And I could go on 
and on. But I think you get my point.
    These are not the major oil companies. They are national 
labs and research institutions that are benefiting and are 
serving and are partnering with this and energy efforts. This 
is as much a scientific thrust as it is an energy thrust, and 
all of these cases of existing research projects appear to me 
to represent cutting-edge, high-risk science led by university 
research teams. And I am aware that each of these projects 
includes significant cost share provided by industry.
    Mr. Secretary, do you believe that the oil and gas industry 
left to its own devices would fund these types of research 
projects? I don't think so. Would you not agree that the 
character of these research projects is similar to the type of 
research projects funded by DOE Office of Science?
    Dr. Chu. Well, actually, the type of research that you just 
described, for example, improving our ability to recover oil 
from reservoirs, we typically only get about 30 percent, even 
with the advanced and enhanced oil recovery methods, we 
typically get 30, maybe at most 40 percent of the oil in the 
ground. The rest of it is with today's technology 
unrecoverable. And so I think it is appropriate for the 
Department of Energy to be funding things like that. You know, 
the injection of CO2 for enhanced oil recovery is 
something that has been proven to be commercially viable. There 
are other opportunities of injecting, for example, microbes 
deep in the strata, which liberates some of the oil and allow 
it to be pumped out. Those things I actually think it is 
appropriate that the Department of Energy fund.
    Mr. Hall. I appreciate the fact that I believe you will 
discuss it with us and then we can talk to you about it. If we 
could talk to the former Secretary as he was loyal to a 
President that objected and was on the other side, I was not 
accustomed to being on the other side of George Bush, but on 
this situation I surely was not there.
    Second, are you aware that there are currently 92 
applications from universities and national labs, state 
agencies, and private R&D technology development companies 
totaling $105 million that have been peer reviewed and are 
awaiting action? I am told that these projects are immediately 
ready to proceed and would immediately employ researchers and 
supporting personnel. Should this not qualify for use of some 
of the stimulus fund?
    Dr. Chu. Actually, I am not aware of the details of the 
proposals, and I certainly will look into it.
    Mr. Hall. But you are open to----
    Dr. Chu. Yes.
    Mr. Hall.--submitting them to you? And finally, Mr. 
Secretary, I would like to ask you if you have personally 
reviewed the quality of research supported by this program? If 
not, could you provide me with your assurance that you will 
personally look into this and give me your assessment prior to 
taking any further actions in the funding issue? I greatly 
respect your scientific credentials and would welcome your 
personal review.
    Dr. Chu. I have not----
    Mr. Hall. I am not alone in this because up and down this 
row we voted for this program more than once, and we think that 
we are getting energy from this program that we wouldn't get if 
we didn't have this energy. And it is being paid for by the 
energy we do get, so it is no cost to the taxpayers actually. 
And I want to talk to you about it.
    Dr. Chu. Okay. I am looking forward to talking to you about 
it. I actually didn't know. I will confess that the Deep Water 
ocean recovery was actually supporting these other things of 
enhanced oil recovery on land, so I would be looking forward to 
talking to you.
    Mr. Hall. And I thank you, and I thank the Chairman for 
letting me go over a little bit.
    Chair Gordon. Mr. Wu, you are recognized for five minutes.

      Standards and Inter-operability for Cap-and-Trade and Smart 
                                  Grid

    Mr. Wu. Thank you, Mr. Chairman. Welcome, Mr. Secretary. 
You have blown into town like a breath of fresh air. I love 
your talk about transformational technologies. For the moment, 
I would like to invite you to talk a little bit about more 
mundane things like standards and inter-operability and matrix 
with respect to two areas, one is proposed cap-and-trade 
legislation and the other is for the proposed Smart Grid.
    With respect to cap-and-trade legislation, as you see it, 
are there remaining matrix or measurement issues both with 
respect to measuring for the cap and quantifying and measuring 
for the trading units, and can the National Institute of 
Standards and Technology or other measurement groups be helpful 
in creation of both the legislation and the regulatory format 
to follow?
    Dr. Chu. I think in terms of the measurements, I am not 
deeply connected to how one evaluates things. You are talking 
of for example overall life cycle emissions for a cement 
industry or steel or----
    Mr. Wu. Whether one views it as life cycle or even just 
measuring at one moment in time and accurately doing so.
    Dr. Chu. Right.
    Mr. Wu. Two different problems.
    Dr. Chu. Right, and so the measurement itself, it does 
become important if an estimate of how much carbon is being 
emitted, would it influence how much allowances one would have. 
I did not know, sir, that this was that controversial. I do 
know there are varying degrees in an industry, let us say, in a 
cement industry, varying degrees of how efficient some plants 
are. But I didn't realize--you know, you look at plant X or a 
coal-burning plant and, you know, you see these ratings. The 
most efficient coal-burning plants are, let us say, 42 percent 
efficient, the least efficient are actually in the mid-low 
20's. I would expect that the estimates of how much emissions 
these plants were making per amount of energy produced was not 
that controversial. If it is, that would be an issue. I would 
certainly look into that. That is the sense I am getting from 
your question.
    Mr. Wu. Yes, I am trying to get my arms around it, and I 
was hoping that you knew more than I did. And it looks like we 
both have some research to do in the----
    Dr. Chu. Right. Give me some time and to see how 
controversial the estimates would be is specifically the 
question I think I am hearing.
    Mr. Wu. Yes, and then life cycle estimates are another----
    Dr. Chu. Right.
    Mr. Wu. Then with respect to Smart Grid, in a prior energy 
bill, we put in some language on inter-operability, and I 
wanted to get your take on the current status of two different 
issues; one is inter-operability of different components of a 
Smart Grid, and the other is the issue of open source versus 
proprietary software to operate significant parts of a Smart 
Grid.
    Dr. Chu. Yes. This is something I did look into almost 
within the first few weeks. I have only been here for only a 
couple weeks anyway, so I guess everything I have looked into 
is in the first couple of weeks. But in any case, yes, I think 
in the 2005 Energy Act there was a committee that DOE in 
cooperation with NIST to get some standards, and I have to say 
that I have been somewhat disappointed. They are just beginning 
to sort of arrange the seating chart around the negotiating 
table to put it in foreign diplomacy language. So we have held 
a couple of meetings with people from NIST to say this has to 
be fast-tracked because this has been going on for almost two 
years. The issue is essentially that--first, I am in favor of 
open standards, very much in favor of industry actually coming 
together and agreeing on an open standard, and so I am pushing 
very, very hard that this thing really get moving. I have 
talked to several people. Even before becoming Secretary of 
Energy, I have talked to people from many of the companies like 
Siemens and ABB, I talked to the CEO of General Electric very 
recently. Every time I talk to them, they say we are all in 
favor of this, and I say, well, let us stop jockeying for a 
slight commercial advantage. It is too important, which is what 
standards negotiations are all about.
    So what we are doing--the plan now is--also FERC is in on 
this--is the distribution centers. These are the really big-
dollar stuff, you know, the digital relays, the transformers, 
that have to have a communications standards system. Those 
standards have to be developed first. The commercial, you know, 
consumer stuff is the last thing. So at least we said we have 
got to get what we want in the standards, and we have to get it 
very quickly.
    It has been a week or two since that meeting. I haven't 
gotten feedback. That is the other thing I found out is, you 
know, you typically have to get a next meeting with 
deliverables for that meeting in order to actually make sure it 
goes forward. But this is very much on my radar screen.
    Mr. Wu. Well, I wrote a part of that language referring to 
the 2005 legislation. I wrote part of that language at 40,000, 
so I attached to it and if I can help you get some results on 
that from NIST or other agencies, I would very much like to 
work with you on that.
    Dr. Chu. Yes, I think as we develop these pilot experiments 
in Smart Grids, unless you have the communication standards in 
place, people are very afraid to make millions and tens of 
millions and perhaps even hundreds of millions of dollars of 
investment because of the retrofit. So the standards thing very 
early is something that is very important. You know, I have 
actually raised it with the President, and he has actually said 
he would be willing to go into a meeting. I said we should lock 
them up in the room and say don't come out until you have a 
standard.
    Chair Gordon. Thank you very much, Mr. Wu. Secretary Chu, I 
told you early on that four years goes very quickly, and you 
are seeing the rope-a-dope that can make it go that way. So you 
absolutely have got the right idea. It takes that leadership. 
You have got to push it down to make it work.
    Dr. Bartlett is recognized.

                     Peak Oil and Security Concerns

    Mr. Bartlett. Thank you very much. Welcome aboard, sir. To 
the extent that we have not been as aggressive as we might have 
in finding new oil fields, to the extent that we have not done 
what we might well have done in enhanced oil recovery, I am 
encouraged because that means there is going to be a little bit 
more oil for my 10 kids, my 16 grandkids, and my two great-
grandkids.
    We have been relating ourselves to oil as if it were 
infinite, that there would be no end to it. That of course is 
not true. There is such a thing as peak oil. It was predicted 
by M. King Hubbert in 1956 for our country. Right on schedule 
it occurred in 1970, and although we have drilled more oil 
wells than all the rest of the world put together, we cannot 
make M. King Hubbert a liar.
    A couple of years ago I led a codel to China, and we were 
talking about energy. And they began their discussion of energy 
by noting post-oil. There will be a post-oil world, of course. 
We think in terms of the next election which for us in Congress 
is never less than two years away, and in the business world 
they kind of think in terms of the next quarterly report. If 
they can't make that look good, why, the stockholders are going 
to be angry at them.
    In that part of the world they tend to think in terms of 
generations and centuries. Of course, there will be a post-oil 
world. Hyman Rickover gave a great speech, I think probably the 
most insightful speech of the last century. It was given 52 
years ago, the 14th day of this May, to a group of physicians 
in St. Paul, Minnesota. And in that speech he noted that the 
age of oil would be but a blip in the history of man, he said 
in the 8,000 year recorded history of man. He had no idea then 
how long the age of oil would last, but he said how long it 
lasted was important in only one regard. The longer it lasted, 
the more time would we have to plan an orderly transition to 
other energy sources. Of course, we have not been doing that. 
We have been behaving as if oil is forever.
    I am concerned, sir, about the lack of urgency in our 
country and indeed around the world. Business as usual will not 
suffice. China is buying up oil all over the world. In today's 
world it makes no difference who owns the oil. The person who 
comes with the dollars buys the oil. Why, sir, do you think 
China is buying up oil all over the world and what do you think 
our response ought to be to that?
    Dr. Chu. China has been following somewhat America's 
economic development. It is buying oil because as its economy 
grows, it needs more oil.
    Mr. Bartlett. But sir, today you don't need to own the oil. 
To have the oil, you simply come with the dollars and you buy 
the oil. Why are they buying the oil?
    Dr. Chu. Are you saying--well, they are establishing--my 
understanding is they are establishing relationships with 
countries as did the United States and does the United States 
in terms of the oil suppliers, but I agree with you, oil is a 
commodity. It is on the market, and you can buy from one 
supplier or another supplier.
    Mr. Bartlett. At the same time, they are buying up this oil 
all over the world, they are very aggressively building a Blue 
Water Navy. Can you imagine, sir, that the day may come when 
the Chinese tell us, I am sorry guys, but we own the oil and we 
have 1,300,000,000 and 900 million of them live in rural areas 
and through the miracle of communications, they know the 
benefits of an industrialized society and they are demanding 
it, and we are not going to share our oil with you. To make 
that a reality, wouldn't they have to have a big Blue Water 
Navy?
    Dr. Chu. Well, I think this goes to a larger question of 
why the United States should work very hard for energy 
independence and oil independence, and there are two ways of 
doing this. One is to develop sources at home, one is to 
develop alternative sources, for example, biofuels which I 
personally believe if we do the science correctly can be a huge 
addition to liquid transportation fuel. Another thing is use 
less oil by making more efficient cars, personal vehicles, 
electric vehicles, so we can off-load and transfer the personal 
transportation needs to electricity which then there is a wider 
palate of options available.
    The thing the United States can do best instead of 
jockeying for positions is to actually decrease our importation 
of oil in a significant way by all the above-mentioned things. 
And so that is the best thing we can do, and this is something 
we should do.
    Mr. Bartlett. Thank you, sir, and thank you Mr. Chairman.
    Chair Gordon. Thank you, and Dr. Baird is recognized for 
five minutes.

            ARRA, Ocean Acidification, and Consumer Behavior

    Mr. Baird. Thank you, Mr. Chairman. Thank you, Mr. 
Secretary. I am going to be very quick with five questions, 
then you can answer them in the time available.
    First, I would like you to speak briefly about the 
constraint on the administrative costs on DOE that were imposed 
on the stimulus and how that would affect you. Second, could 
you talk a little bit about CO2's impact on the 
oceans, particularly ocean acidification? Third, your views on 
behavior change and conservation as a quick response to both 
our energy and our climate overheating. Fourth, the role of 
forest products in renewable energies. And finally, if you have 
time left, a little bit about the national labs. Thank you.
    Dr. Chu. Okay. So the first is a technical issue. Thank you 
for the questions. In the Economic Recovery Act, there is--in 
order to, for example, administer the loans and to make sure 
that the money is wisely invested and to have proper oversight, 
you need additional administrative costs. In the other 
agencies, they were given one percent of the total to 
administer those costs. This is an example. For some reason not 
clear to me, the Department of Energy was given one-half of a 
percent.
    Mr. Baird. So as important as energy is, we have said we 
sort of shorted you. You only get half of what the other 
agencies get.
    Dr. Chu. Right. To administer the loans, for example, and 
the things that we need to do to make sure that the money is 
given out wisely, that there is proper oversight, and things of 
that nature. So that is worrisome.
    Mr. Baird. I would hope we can try to address that. We will 
do what we can to help.
    Dr. Chu. In terms of the CO2 impact, there are 
many impacts. I share your concern that perhaps the oceans are 
not mentioned enough. What happens is as the CO2 in 
the atmosphere increases, more carbon dioxide is absorbed in 
the oceans. It becomes more acidic. Today the oceans are about 
30 percent more acidic than they were in pre-industrial 
revolution times. It is significant. And when the ocean becomes 
more acidic, several things are known to happen. Coral is 
threatened, the little critters that when you go snorkeling hit 
your snorkel mask. They have calcium carbonate shells. Those 
organisms actually, when the pH gets too low, and they are at 
pH seven, what is going to happen is that they will lose their 
ability to capture the carbon and put it in their shells and 
actually construct their shells. So lab experiments where they 
just deliberately make it more acidic, they find that they lose 
their ability. When that happens, the whole food chain in the 
ocean is at risk.
    Now that is not going to happen any time soon, but these 
are some of the issues that one is concerned about.
    In terms of behavior change, this is something that if you 
look in the history of how you get the United States to respond 
very quickly, we should be paying more attention to this. If 
you consider what happened in World War II, there were posters 
saying that we should save energy, especially transportation 
fuel, because any drop we saved in energy and transportation 
fuel could be used in our wartime effort. And there was a great 
deal of input, and Americans rose to the challenge and it 
became their patriotic duty to save energy. Now we have a 
similar situation. If you save energy, for example, by getting 
more fuel-efficient cars, you decrease the demand. That will 
keep the prices down. There is a lot less carbon in the 
atmosphere, and we are less dependent on foreign oil.
    And so I think it is a three-for, if you will, in terms of 
not only patriotic duty to our country but actually to the 
world. And I think to get this notion that it is good in many, 
many ways to think about decreasing your consumption of energy, 
whether it be turning off light bulbs or your computers after 
you are done or buying a more fuel-efficient car, when that 
opportunity arises, these are all things that we need to do. 
The United States has convinced a younger generation that it is 
not cool to smoke cigarettes, and that has changed behavior. 
And I think we should convince the younger generation and the 
older generation that it is actually cool to save energy and 
become much more energy efficient. This is something that the 
world really needs.
    So this change of behavior is something America has been 
able to do in the past, and we have the tools. I am all for 
talking more about that.
    And in terms of--you mentioned forest products. This goes 
to the question of biofuels. You know, already these biofuel 
programs in our national labs have already altered yeast and 
bacteria so that the yeast and bacteria, when fed simple 
sugars, can produce not just ethanol but a gasoline-like fuel 
and diesel-like fuel and jet plane-like fuel. And so now they 
are working on increasing our productivity to make it 
economically viable.
    The good thing about the feed stock is they want to use all 
of the lumber wastes, the agricultural wastes that include 
wheat straw, rice straw. Half the corn stover can be used. The 
other half has to be ploughed back into the fields, but half 
the corn stover can be used. All the agricultural waste that we 
either burn or we let rot that ends up into microbes, turn that 
into carbon dioxide and methane, we should be converting that 
to either helping coal-burning plants or better still, 
converting this into transportation fuel, again to help break 
our oil dependency.
    This is something that the national labs and the Department 
of Energy is working very hard in doing because this is could 
be a significant, this could be half our non-diesel jet plane 
transportation fuel. And finally, the national lab systems----
    Chair Gordon. Doctor, we are going to have to get to the 
national labs later, if that is okay.
    Dr. Chu. Okay.
    Chair Gordon. I am sure that will be of interest to other 
folks, too.
    Ms. Biggert is recognized.

                 Nuclear Energy and Waste Reprocessing

    Ms. Biggert. Thank you, Mr. Chairman, and I welcome you Mr. 
Secretary. You and I have had a brief conversation earlier on 
nuclear energy. I would like to get to that, but just before I 
do that, I am going back to a question that Chairman Gordon 
asked you, and that was about the technology transfer on an 
international basis. Section 1001 in the EPACT bill of 2005 
addressed the issue of having a new technology transfer 
coordinator and working group appointed to have a basis of 
working with developing countries to employ clean, efficient 
energy technologies and then listed the barriers and the 
concerns. I don't know if you have worked with that or have a 
coordinator in place.
    Dr. Chu. No, I don't have a coordinator yet.
    Ms. Biggert. Okay. I refer you to this bill. It is Public 
Law 109-58 also. But you and I have discussed very briefly 
nuclear energy and reprocessing, and I was concerned to hear 
that you moved beyond the repository of Yucca Mountain, the 
decision of the Administration. And I really am concerned about 
that. So where does that leave the Department of Energy in 
regards to reprocessing and the next generation of nuclear 
plants?
    Dr. Chu. Well, first, let me start by saying that I do 
firmly believe that nuclear energy has to be part of our energy 
supply in this century for sure because it is carbon-free.
    So in terms of the waste, what the NRC has said is that if 
you store the waste in dry can storage at current sites, it is 
safe for decades from leakage into the environment. So that 
means we have time to develop a much more comprehensive plan. I 
am working, I know the Senate has already begun to talk about 
this, of--and we have independently but would like to work with 
Congress in this to put together a very blue-ribbon panel of 
experts, of technical experts and wise people who can help us 
devise recommendations for a comprehensive plan and a fresh 
look at how we can store nuclear waste and eventually dispose 
of it.
    The whole Yucca Mountain issue is that the landscape has 
changed over the 20, 25 years when this first started. The 
conditions for--first it started as 10,000 years and it had to 
be retrievable. Then Appeals Court ruling said no, if science 
says the leak-out rate could extend to a million years, so be 
it. Then it should be a million years and yet still be 
retrievable. So the conditions changed, and so I would like a 
committee to say, okay, let us take a fresh look at the things 
and what is our best strategy for moving forward on nuclear 
power.
    Ms. Biggert. President Carter shut this down what, 25, 30 
years ago, and that really has set the United States back on 
nuclear energy. But over the past 30 years, our national labs 
have been conducting research on Yucca Mountain. And your 
laboratory was part of that, many of the scientists. And it 
really has--you know, some of our--hundreds of our best 
scientists and engineers have been working on this, and it just 
seems like this is such a setback. This research has been 
incorporated into the Yucca Mountain license application which 
is now before the NRC. It just seems like we are just going 
back to page one again and starting over, and I think that if 
we are ever going to end our dependence on foreign oil, that 
nuclear has to be in the long-term the one that will take us 
over the top and really solve that problem. I don't know if you 
received the comprehensive briefings on the deficiencies of 
Yucca Mountain science and by whom, but I really am concerned 
about this and I think that we really have a lot of permits out 
there for new type of reactors, and if we don't move now, I 
don't know when this is going to happen. This is a real 
setback.
    Dr. Chu. Well, I do share your feeling that we do not want 
to start--I want to see the restarting of the nuclear industry 
in the United States. So the goal that you and I both share--
the other thing is that I fully intend to fund research in 
developing recycling methods that are proliferation-resistant.
    Ms. Biggert. But I think that has already happened, and I 
know Argonne has worked on that in Idaho. There has been a lot 
of research on that already, and there are some demonstration 
projects. And we were really ready to go two years ago.
    Dr. Chu. Okay. So my understanding of that, certainly 
Argonne and people in Idaho have been looking at modifying the 
original PUREX\1\ process which is----
---------------------------------------------------------------------------
    \1\ Plutonium Uranium Extraction
---------------------------------------------------------------------------
    Ms. Biggert. Right.
    Dr. Chu.--the process that France uses.
    Ms. Biggert. Now it is a EUREX.\2\
---------------------------------------------------------------------------
    \2\ Enriched Uranium Extraction
---------------------------------------------------------------------------
    Dr. Chu. Now it is a EUREX process, but those people who 
developed those feel it is not ready for piloting, that there 
are still issues----
    Ms. Biggert. Who are those people?
    Dr. Chu. Those people are people like Phil Fink. He used to 
be at Argonne. He is now in charge of that program in Idaho. I 
think he is very, very knowledgeable. Those are people who I do 
have a lot of trust in, and they are saying that we need to do 
more research before we build pilot plants.
    Chair Gordon. Thank you, and Ms. Giffords is recognized for 
five minutes.

                              Solar Energy

    Ms. Giffords. Thank you, Mr. Chairman, and thank you, Mr. 
Secretary, for coming before our committee today. It is no big 
surprise for Members here that I am very passionate about my 
home State of Arizona and solar energy. When you think about 
over 300 days of sunshine that Arizona has, other western 
states, and frankly the whole country, really, I mean, 
comparing where we are with other countries, specifically 
Germany, Japan, of course Spain, I believe the United States is 
missing an incredible opportunity.
    So I was really delighted to hear your comments earlier 
about your emphasis for DOE to start pushing for I think five 
times cheaper technology for photovoltaics, but I would like to 
specifically ask you about the actions for DOE under your 
leadership in terms of engaging with the private sector for 
solar. Could you be a little bit more specific?
    Dr. Chu. Well, it depends--see, normally what has happened 
in the past is the Department of Energy will do some science, 
invest in some science, and get some patents and license the 
patents. I would want to go forward in an era where we begin to 
work with companies in a much more intimate way to get sort 
of--while the work is being done, I think companies do bring a 
lot of experiences in the sense that they are more tuned to 
manufacturability issues than anyone in a laboratory. And so 
one of the things I have heard in the past is that--you know, I 
was in Silicon Valley in the Bay Area, and there are a lot of 
photovoltaic companies there. And when I hear things like, 
well, the research direction in a particular laboratory, we 
stopped paying attention because in an effort to achieve a 
world record of incrementally better efficiency, they have gone 
away from manufacturability. I am thinking to myself, this is 
not good.
    And so I think that it is ultimately going to be the cost 
of manufacturability and whether it is--you pick a number, 
whether it is 22 percent for silicon versus 22.5 percent or for 
the very advanced ones, the multi-colored ones of going from 39 
to 40 percent, it is not as important as getting the cost down.
    And so that is one of the things I would really dearly love 
to have is that the companies who have to deal with the 
manufacturability issues are actually there side by side with 
the scientists in the national labs and the universities.
    Ms. Giffords. I was laughing. You go to the Bay Area. It 
seems like everyone has got a business card, has got a solar 
energy business card. You know, it is an incredible melting pot 
for a lot of that technology. My concern is not just from the 
patent side, but I don't see enough demonstration projects 
actually taking place. There is a lot of R&D going on, a lot of 
money in that area, but in terms of actually rolling the 
projects out, I don't see enough of it.
    Dr. Chu. Well, I think the loan guarantee will help some of 
that. I think renewable portfolio standards which create a draw 
of the market will also help some of that. But solar thermal, 
for example, large-scale solar thermal right now is less 
expensive than photovoltaic, and there are some projects that 
are being considered. In California I know of at least one that 
should be given a chance. These are a couple hundred megawatt 
projects, very significant projects, which also have in it some 
energy storage as well because you can store the heat. And I 
agree. So those things should be demonstrated, and I think the 
loan guarantees and things like that will help.
    Ms. Giffords. One of the areas I think we can get our 
biggest bang for the buck is with our United States military. I 
had a chance to visit Nellis Air Force Base last year, and this 
is an incredible, great success story in terms of the public-
private partnership. When you look at the DOD, 80 percent of 
all of the Federal Government's energy is used by the DOD, and 
I believe that military bases provide us the best ability to in 
a very quick way, unlike a lot of areas of our Federal 
Government, to put projects, to install projects, get them 
going. And I am just curious about DOE's ability to partner 
with DOD and put some of these demonstration projects--if you 
are working on that and if it is on your radar screen.
    Dr. Chu. It is now, but it certainly is true that the 
Department of Defense does--they have a lot of land as well, 
and so they actually have the ability to test a lot of things 
in solar energy as one example. So I will look into it.
    Ms. Giffords. I am looking forward to working with you, Mr. 
Secretary. Thank you, Mr. Chairman.
    Chair Gordon. Thank you. Mr. Bilbray has five minutes.

                         More on Nuclear Energy

    Mr. Bilbray. Thank you, Mr. Chairman. Mr. Secretary, I was 
just kind of listening to the conversation. I probably have one 
of the most environmentally sensitive, you know, parts of 
California, the coastal area of North San Diego. In fact, one 
of my communities would probably pride themselves on 
environmental sensitivity and was pushing renewables way back 
in the '80s. I happen to represent the first city that outlawed 
wind generators within their jurisdiction, too. So one of the 
biggest concerns that I have coming from local government was 
how much government is standing in the way. Let me first say, 
as a former member of the L.A. Resource Board in California, 
knowing your record, I was really excited to hear that the 
Administration was looking to you to take this position, and I 
really feel good about it. I really feel good about it for one 
reason. You were somebody, along with your other directors of 
the Department of Energy, to stand up and be willing to say 
what needed to be said and not worry about the political 
repercussions, and I think that says a lot about the 
Administration, that they were willing to choose somebody who 
had said something that might not have been politically correct 
at the time but was scientifically essential to be said. Your 
position in August, along with the other secretaries on the 
absolute essential part that nuclear power is going to play in 
climate change issues, shows that you were brave enough to say 
that. I think more people like yourself standing up will send a 
signal to everybody that, you know, those who were so 
prejudiced against this clean form of energy need to rethink 
their prejudice.
    At this time, with what you know, would you agree that the 
disposal issue is not the overwhelming blocking barrier that 
some people have thought it was back in the '70s and the '80s?
    Dr. Chu. I think we can find a solution to disposal. Maybe 
call me stupid or crazily optimistic because there is time, 
because we can work out better solutions. The safety I think is 
less of an issue as well. I think the newer generation reactors 
are going to be far safer. In fact, ultimately we will have 
passively safe reactors in the sense that you lose control of 
your reactor completely and you won't get a melt-down.
    The issue actually is a commercial issue. How do you 
increase the licensing speed because these are $5-$8 billion 
reactors, and if you have a 12-year licensing and building 
plan, that is many billions of dollars which is not generating 
revenue.
    Mr. Bilbray. Again, this falls in that category, does 
government allow the technology to be used, like the wind 
generator. Down the line on the technology issue, we talk about 
setting efficiency goals and trying to think, allowing people 
to think outside the box. Right in with a lot of these kinds of 
challenges, does our regulation guidelines allow that? I will 
give you an example. In my district, I have got Aptera which is 
developing a new car that went out and started reverse 
engineering, designing the most aerodynamic, most efficient 
system, was able to develop a car that gets over 100 miles to 
the gallon at this time, with the potential of going out to 200 
with hybrids. But when the company applied to the Advanced 
Technology Vehicle Manufacturing Loan program, even though the 
vehicle passes all the crash tests, all the safety tests, 
everything that we perceive as being a car, because the 
scientists saw that having a second wheel in the back caused 25 
percent reduction, they went to a three-wheeled vehicle, 
because it was three and not four wheels, it was not allowed to 
apply for this loan. Would you strongly support the 
modification of these kind of arbitrary lines so that they 
reflect outcome rather than process?
    Dr. Chu. I certainly would look into that, whether it is, 
you know, a three-wheeled car is not a car, which is 
essentially your question, you know. If it does all the things 
a car does, it might be a car.
    Mr. Bilbray. I think so. In fact, Mr. Secretary, after you 
are finished with this hearing, if you go downstairs, the car 
is out front as an example of the kind of things we need to do 
rather than having regulations to block it.

                                Biofuels

    Speaking of government regs, you make a reference to the 
fact that we need to be looking at gasoline-like biofuels 
rather than working off of alcohol that takes a gallon-and-a-
half to match traditional fuels. And in fact, let me just take 
another shot at ethanol which I never pass up a chance as 
former member of the Air Board, Duke just came out with a study 
that said from the greenhouse point of view, it would be better 
never to plant the corn than to use corn-based ethanol. But 
when you talk about these non-food crops, would you be 
including in that the algae technology that we are seeing 
developed around the country?
    Dr. Chu. Yes. You know, one doesn't really know whether the 
best solution to biofuels are biofuels through the conversion 
of the lignocellulose material or through the growing of algae 
which actually can grow directly lipids that can be converted 
to oils and diesel-like oils. The verdict is not in. The thing 
about the lignocellulose is in a certain sense it is more ready 
for prime time only because we have lots of agricultural waste 
already. The issue with algae is you would have to prepare land 
or ocean specifically for this. There is also issues of whether 
it escapes into the wild. But I am all for looking at algae, 
don't get me wrong.
    Mr. Bilbray. There was a reference to----
    Chair Gordon. Thank you, Mr. Bilbray.
    Mr. Bilbray. Okay. Thank you, Mr. Chairman.
    Chair Gordon. Mr. Hall is going to lead a delegation 
downstairs to see if your vehicle quacks a little bit later. 
Ms. Edwards is recognized.
    Ms. Edwards. Thank you, Mr. Chairman, and thank you, Dr. 
Chu, for being here today.

                       DOE Loan Guarantee Program

    I have a couple questions about the Loan Guarantee Program 
under Title XVII. When the program was started, I wasn't in 
Congress at the time but I believe that it was to, and I will 
use the words in the legislation, to avoid, reduce, or 
sequester air pollutants and greenhouse gases, employ new or 
significantly improved technologies, and provide you with the 
prospect of repayment. And so I have some questions about the 
rules that were promulgated by the Department for the Loan 
Guarantee Program and wonder what the rationale under this 
legislative language is for guaranteeing loans to a mature 
technology, rather than making significant investments in some 
of the innovative technologies than perhaps traditional 
financing that is available to them. And then I would like you 
to address the question of the risk to taxpayers under the Loan 
Guarantee Program because the taxpayer essentially absorbs 100 
percent of that, and I think we have already seen in our 
capital markets that when all of that is absorbed by the 
taxpayers, the markets just don't function very well and the 
risk is shared with the innovator. So I wondered if you could 
address these.
    Dr. Chu. Sure. Well, first, in terms of the loan 
guarantees, there is a scoring of a loan. If an industry makes 
an application, if it is a relatively mature industry like 
wind, you know that if you run the business correctly, it is 
likely that the business will be successful and the loan will 
be repaid. And so there is an official way of scoring these 
loans. The higher the risk of the loan, the more--you have to 
have an allowance that says okay, there is a higher probability 
it won't be repaid. So then it doesn't go as far. I mean, right 
now, the idea was that there is quite a bit of leveraging ten 
to one that you know, if the loan is $100 million, you put in 
$10 million that you expect will be the average default rate. 
As you take on higher-risk industries and you have to score 
this as best you can, then the default rate will be naturally 
be higher but it is higher-risk.
    But actually I agree with you. We should be making some 
higher-risk loans, and we have looked into this. That would be 
of the amount of money, you can have--now, the higher-risk 
loans are more experimental, and so you make a smaller attempt 
at trying to get this thing going. But there is nothing wrong 
with saying that there might be a 30 percent chance of a 
default for a loan but it could be more game-changing. So that 
is another way of trying to introduce innovative technology. 
And so there have been discussions now in the Department of 
Energy. I have been discussing this, that a small fraction of 
our loans could be higher-risk that could be much more 
innovative, much more likely to fail but could lead to bigger 
changes in the long run.
    Ms. Edwards. And so you are about to announce some of the 
loan guarantees, and so can you assure us though there is not--
those won't be guarantees in the much more mature technologies 
like, you know, liquid coal and nuclear?
    Dr. Chu. Well----
    Ms. Edwards. I don't see that that falls within the 
description of what the program was designed to do.
    Dr. Chu. No, for example, in nuclear, there has been $18.5 
billion to help restart the nuclear industry. And so that has 
been a carve-out for nuclear and those loans are designated to 
helping companies. You know, we have had a dormant nuclear 
industry for the last 30 years, the last one nuclear reactor 
that has been started in the early middle '70s.
    Ms. Edwards. I know, Dr. Chu. There are some of us down on 
this end in particular who remain skeptics of that----
    Dr. Chu. Okay.
    Ms. Edwards.--of those kinds of significant investments in 
nuclear technology. Just as I close out here because I would 
like you to address at some other point later, it seems that 
these guarantees for nuclear though are going out before the 
licensing. So there is a lot of time between here and there in 
billions of dollars in investment, and I wonder if those 
billions, given where we are with climate and our energy 
crunch, what if that money actually couldn't be better spent 
for better purposes, especially when the nuclear industry 
investment is going to be the one that will, you know, save us 
from fossil fuels.
    Dr. Chu. Well, I think there is no one single technology 
that is going to save us, and in fact, quite frankly, you know, 
with fossil--carbon capture and sequestration is one of those 
things. But right now where we are in the United States is we 
have only 2.8 percent roughly of our nation's electricity 
generated with renewables, excluding hydro which is six or 
seven percent. And so it is going to take a while to ramp that 
up, and the costs are--in wind it is becoming competitive, but 
they are not there yet for photovoltaics, costs without 
subsidy. And there are distribution issues, there are storage 
issues.
    I for one would dearly love to see us transition to all 
renewable, solar, wind, things like that by mid-century, but 
one doesn't really know if one can do that. So you put the 
pedal to the floor on that, but you also try to ensure that 
while we are transitioning, you clean up coal as much as you 
can and don't forget that the rest of the world, notably China 
and India, will not turn their back on coal. So that is why it 
is so important to try to develop commercially viable 
sequestration methods.
    So I think you just have to do all these things. You have 
heard this before, there are no silver bullets.
    Chair Gordon. Thank you, Ms. Edwards. Mr. Smith is 
recognized.

                           Corn-based Ethanol

    Mr. Adrian Smith. Thank you, Mr. Chairman, and Mr. 
Secretary, thank you for your service and your willingness to 
come here today and share with you I think one of our most 
pressing needs relating to energy, the economy, the 
environment, and I appreciate the mention of so many sources of 
energy here today.
    There was mention of corn-based ethanol prior from one of 
my colleagues on this end of the dais. If you could elaborate 
perhaps. Truly I come from a District that is relating to corn-
based ethanol and livestock production. So it creates a need 
for balance, and I was wondering if you could speak to further 
research on corn-based ethanol so that we can be even more 
efficient. I know we have come a long way already using less 
water, making the ratios better. If you could elaborate on 
that.
    Dr. Chu. Well, corn-based ethanol I view as--you know, if 
you do the life cycle cost and there are varying opinions about 
this, but in the end, it brings you a little reduction, you 
know, in the amount of fossil fuel invested versus net fuel 
gone out. But the potential for the lignocellulose or the algae 
approach is far higher. So right now, you know, if you take and 
you look at all these underlying assumptions for corn-based--
and also in CO2, the net CO2 reductions, 
we are talking about net fossil reductions of 20 percent and 
CO2 reductions of a similar nature. But the promise 
of the lignocellulose and algae can be 90 percent. Now, in the 
end, farmers will be happy to plant anything that they can make 
some money on. So rather than saying we have to protect corn-
based ethanol, I think if we develop technologies that can use 
a lot of the existing infrastructure in the fermentation of 
starches like corn, it is the same type of infrastructure, 
there will be yeast and bacteria that will convert grasses and 
agricultural waste into fuel. I don't really see personally a 
conflict in terms of rural American farmers. In fact, I have 
given a couple of talks over the years to that part of the 
country, and they would like very much to be using their 
agricultural waste and also to be growing these grasses because 
these are perennials. In autumn time, the nutrients, especially 
the nitrogen, is drawn back and the precious minerals are drawn 
back into the roots. You chop off the top part. The cell wall 
where the cellulose is, the energy stuff. We don't use the 
nitrogen. And so that means a big decrease in the energy inputs 
from fertilizer which is made from natural gas to ammonia 
fertilizer is eliminated. A lot of the inputs in the diesel 
tractor fuel is eliminated.
    So less capital investment of the farmer each year because 
each year the farmer makes a gamble, you know, a significant 
capital investment to yield a crop. So if they can get a 
similar return or better return on investment, a similar 
overall net, they would be very happy. So I think, you know, 
corn-based ethanol, think of it as a transition crop to get 
Americans used to the idea that you can grow transportation 
fuel. But it is by far and away not the ideal. And that is why 
we are investing much more in lignocellulose or algae. That is 
why, for example, BP which invested in the University of 
California at Berkeley, Berkeley Lab in Illinois, half-a-
billion dollars because they weren't interested in ethanol from 
starches like corn. They were saying that is not the long-term 
future.
    Mr. Adrian Smith. It seems that the commercial viability of 
cellulosic ethanol--for 10 years we have been told that it is 
about five years off. How close are we?
    Dr. Chu. I think you are getting a different class of 
people going to this, and this is true of the energy sector in 
general, not that people who were working on it 10 years ago 
were lesser scientists, but I think now there is a real 
mobilization. I mean, six years ago, I decided that the energy 
and climate change problem was so serious that I was willing to 
forego a very, very comfortable life at Stanford as a professor 
and run a national lab which is much less comfortable. And for 
the same reason why I took this job which is even less 
comfortable, that many scientists are thinking that this 
issue--this is one of the most important issues that science 
and technology has to solve in the coming decades. And it is 
becoming such an important issue and an internationally 
important issue because as commented in this committee, it does 
help define geopolitical stands around the world as well.
    So international security, you know, economic prosperity, 
environmental concerns all say that we have got to solve the 
problem. Because of that, just as in World War II, many 
scientists volunteered and enlisted to serve their country. I 
am seeing now many scientists thinking if there is something I 
can do on energy, what can I do? And they are trying to teach 
themselves. Also, a new idealism in America's youth in college, 
that they are actually thinking of going for science and 
engineering because they see this as the way to serve the world 
and their country.
    So when you have that enthusiasm in the scientific and 
engineering world and you harness it properly, I think you can 
get--we can expect much greater progress. And this is what the 
Department of Energy funding really is all about, quite 
frankly. Take advantage of that.
    Chair Gordon. Thank you, Mr. Secretary. Hopefully this is 
the new Sputnik. Mr. Smith, hopefully also that shucks and cobs 
have a future so that we can call a win. Ms. Fudge is 
recognized.

                   The Economics of Emissions Trading

    Ms. Fudge. Thank you, Mr. Chairman. Good morning, Mr. 
Secretary. Mr. Secretary, I am from the State of Ohio. 
Currently the State of Ohio gets about 86 percent of its 
electricity from coal. This gives us an advantage for luring 
manufacturers, of course, because of the cost, the lower cost 
of coal. As a result, we have many industries that are very 
energy intensive: paper, steel, plastics, fertilizer that rely 
upon coal to keep their prices competitive which is especially 
important during this troubling economic time. Our exports as a 
nation have decreased dramatically.
    And so I am asking, given the Administration's support of a 
100 percent auction for a cap-and-trade program that will 
likely raise electricity rates for consumers and especially 
manufactures like those in the State of Ohio, has there been 
any discussion as to how can we work to minimize the economic 
effects that a cap-and-trade program will have on these 
industries to ensure that their national and global 
competitiveness is not compromised?
    Dr. Chu. Well, you are raising a very important issue. The 
cap-and-trade bill will likely increase the cost of 
electricity, and so a lot--so under the Administration's plan 
of using a significant part of that money--first, there are two 
issues. There is the poor part of society that has to be 
guarded against, and so a part of the Administration's plan is 
to try to ensure that the poorer segments of our society are 
not really hurt.
    With regard to, you know, increasing the costs, it is--let 
me go straight to the heart of the matter. Many of these costs 
will be passed onto the consumers, but the issue is how does it 
actually--how do we interact in terms of the rest of the world? 
If other countries don't impose a cost on carbon, then we would 
be at a disadvantage. I think the only way to do this is to--
and already the Administration and others before it have talked 
about it--that you have to think about if you have something 
that is manufactured in another country that is not including 
the cost of emitting the carbon, because there is a cost in 
emitting the carbon to society. If country X doesn't do this, 
then I think we should look at considering perhaps duties that 
would offset that cost. We are beginning to talk about that in 
terms of what we call local pollution costs, like sulfur 
dioxide and nitrous oxide, so that will help level the playing 
field.
    Now, in the end, I think one hopes that all countries will 
include the cost of this energy, and I really think about it as 
including the so-called external costs that are folded into the 
direct price now. But if a country does not do that, in order 
to protect American industries, we ought to think about 
something like that.

                       Saving Energy in Industry

    Ms. Fudge. Thank you. And just my second question would be 
that as we talk about, and you mentioned that, we need to try 
to sell industries that it is cool to save energy. So we do 
have the Industrial Technologies Program in the Office of 
Energy Efficiency and Renewable Energy. This important program 
does help manufacturers identify ways to reduce their energy 
usage and thus preserve capital which, you know, of course they 
can reinvest in their company. Can I go home and tell the 
manufacturers in my District who have hard about the success of 
this program that they can expect to finally see additionally 
funding for the Industrial Technologies Program when the 
President's detailed budget is finally released?
    Dr. Chu. I hope so. I think there are--I think in very 
energy-intensive industries, at least some of them I know 
about, they too themselves are looking very hard at the 
manufacturing processes or chemical processes because if they 
save just a little bit on making it more efficient, this is 
tens of millions, hundreds of millions of dollars, it matters a 
great deal to the companies. And the more forward-looking 
companies, they are much more aggressive about this because 
they see in the long term energy costs just increasing because 
in the long term, as noted before, you know, energy, oil, 
natural gas production will eventually peak and decline, 
plateau and then finally decline.
    So I think the energy efficiency of industries and 
companies is a very big deal, and the Department of Energy will 
do what it can as much as possible to help encourage the 
companies to look at their own businesses.
    Chair Gordon. Thank you, Ms. Fudge, for getting those 
important issues here on the table. We need to talk about them. 
And Dr. Ehlers is recognized.
    Mr. Ehlers. Thank you, Mr. Chairman, and thank you, 
Secretary Chu for being here. I will give you a little relief. 
I have very few questions, several statements and comments, but 
I hope we will have some private time as physicists to talk 
about my questions later.
    Dr. Chu. Maybe the Chairman can give you an extra five 
minutes.
    Mr. Ehlers. I doubt it. There is a Majority here in the 
Minority.
    Chair Gordon. You want to go home for dinner, don't you?

                            Program Comments

    Mr. Ehlers. First of all, I am absolutely delighted with 
your appointment, and I have been very disappointed for some 
time in what I consider the failure of the Department of Energy 
to really meet the important energy challenges of our nation, 
and I am really looking forward to your leadership. I hope it 
becomes a renaissance similar to the days when Glenn Seaborg 
and the Atomic Energy Commission really got the ball started on 
this. So I am looking forward to great things.
    I also want to commend the Department. Recently they had a 
competition for a facility for rare isotope beams, and I want 
to commend you and especially the Department. I thought they 
did a very fair process and evaluation, and obviously those of 
us in Michigan are pleased with the result. But I think it was 
a model of how it should be done and how the Department can 
work with the universities.
    On that score, that is the one strong point I see for ARPA-
E. I was not overjoyed with the way it ended up being 
structured, but I think this is a golden opportunity for the 
Department of Energy to essentially take a role that the 
National Science Foundation fills for many other areas of 
research, and I hope ARPA-E really fulfills that promise and 
brings the universities in. We have so much talent available in 
the universities, and I don't think the Department of Energy 
has adequately made use of the university resources in the past 
20 years or so. The one exception to that of course is Ray 
Orbach who did a marvelous, marvelous job in the Office of 
Science in the past eight years, and we made so much progress 
there and I assume you will be eager to continue that progress 
as well.
    A few comments on some of the other issues. There is a lot 
of talk about sequestration. I am still very much a doubter. I 
think just looking at it, it looks to me like it is going to be 
very difficult to do in an economically feasible way, 
particularly when you are talking about China and India doing 
it. Obviously we have the resources to do it, at least we hope 
that we do. But I just have to register some skepticism on 
counting a lot on clean coal or sequestration to deal with the 
carbon problem. And that is going to take a lot of work on your 
part and our part as well.
    It has always bothered me in talking about Yucca Mountain. 
We have always talked about disposal of nuclear waste. You are 
not disposing of them, they are still there. And I think that 
has been a fallacy all along. We thought we could dispose of 
them. We can't. We can perhaps transform them into a more 
benign form, and that is a possibility. But I think we should 
get rid of that word disposal and talk about nuclear storage, 
particularly monitored, retrievable storage, and things of that 
sort.
    On solar energy, you put a lot of emphasis on solar energy, 
but you seemed to imply the use of large facilities to produce 
electricity from solar energy. I am of a different mind. Since 
solar energy is--there are huge, huge amounts of solar energy 
available, but it is very diffuse and that makes it difficult 
to use. It is low-quality energy. And I think we ought to 
recognize that. I think the best answer, if you have a diffuse 
source, then have diffuse collectors. I would like to have 
every home in America shingled to solar shingles instead of 
asphalt shingles, and that brings up the other issue you 
raised. If you are going to do that, one of the most pressing 
needs is going to be safe, efficient, economical storage of 
electrical energy. You referred to it in the context of 
automobiles. I think maybe equally or perhaps maybe even more 
important in homes, if we can in fact develop good solar 
shingles that are dependable, long lasting, et cetera, we need 
a storage mechanism. And right now, batteries are too 
expensive, too clunky, too difficult. And I would hope that the 
Department would be able to make some major contributions in 
terms of battery development and particularly returning that 
industry to America instead of depending on other countries to 
do the research.
    So that is pretty much my short sermon for today, and I 
hope you will take those comments in mind.
    Chair Gordon. Thank you, Dr. Ehlers. We will let you be on 
the next panel. Mr. Wilson is recognized.

                       Coal-to-Liquid Technology

    Mr. Wilson. Thank you, Mr. Chairman. Thank you, Mr. 
Secretary, coming before our committee today. My question goes 
back to clean-coal technology. On several occasions the 
President has said he supports clean coal technology. Mr. 
Secretary, right now I have a coal-to-liquid plant that is 
fully permitted in my District. I happen to believe that coal-
to-liquid is a good form of clean-coal technology. I am 
interested in what your opinion is as to clean coal and clean-
coal technology?
    Dr. Chu. I think coal-to-liquid with the capture of 
significant part of the carbon, the excess carbon, is something 
that is worth looking at. I will go further to say that when 
you start doing coal-to-liquids, the first thing you do is 
gasify and then you assemble it. It is an old process invented 
through World War II by the Germans.
    When you do it with agricultural waste and coal as the feed 
stock and capture the excess carbon, when you produce the fuel 
and burn it, of course, that carbon in that fuel is released 
back to the atmosphere, but you can actually provide--for 
example, if it is oil, biobased, you can actually provide a net 
sink of carbon dioxide because the plant is grabbing carbon 
dioxide out of the air. Some of it goes back in the form of 
carbon dioxide when you burn it, but you are actually capturing 
a lot of carbon dioxide if you can get sequestration to work 
which, with all due respect, I think there is a reasonable 
chance. Then it becomes a net sink.
    And so there are proposals out of getting also hybrid 
plants, so coal with bio material to liquids that capture the 
excess carbon dioxide and it could be a hybrid plant in the 
sense that you can also use it to generate electricity. And so 
I think Professor Bob Williams at Princeton is one of the major 
proponents of this. I know that Dow Chemical is looking at this 
as a--because they are, you know--Dow Chemical is essentially a 
carbon company. They buy forms of carbon, for example, natural 
gas and petroleum, and turn it into other forms of carbon, 
namely plastic. And so if they could get biowaste or even coal 
as their feed stock, that would be a nice thing to do. And if 
you can capture the carbon and sequester it economically, then 
it is clean in the process.
    So I think those are the things that I am personally 
looking into to see if they have a ghost of a chance of 
working.
    Mr. Wilson. Mr. Chairman if I may, Mr. Secretary, again, we 
have done studies as far as on the carbon sequestration and 
have found numerous oil wells as you alluded to earlier, 
somewhere between one-half and three-fourths still with oil 
content. That could be replaced and you can pump the carbon to 
them.
    The next issue we stumble with then becomes the Loan 
Guarantee Program. It is just so much more prohibitive to a 
clean-coal technology versus one that would not be. Do you have 
any thoughts on that? I realize earlier you said about the risk 
that is directly related to them.
    Dr. Chu. That is right. I mean, the risks of--again, if it 
is a technology that hasn't been tried before, there is a great 
deal of risk for that. And so then it is scored much more 
seriously, and then we have a certain amount of money we can 
use to guarantee the loans, because you are expecting certain 
losses. And so that is the issue. We may make fewer loans the 
riskier it is.
    Mr. Wilson. Well, when you look at the grand scheme of 
things and with the way nuclear is doubling in price and 
continuing to go forward, I really hope that the Department 
will look at what the opportunities are with using coal, and 
investing in it may be much less expensive than going to 
continue with the nuclear. And as the Chairman said recently, 
we still wind up with the rods at the end of time. And so what 
do we do? I mean, how do we move forward if we have a mentality 
that keeps us from moving forward with clean coal?
    Dr. Chu. Well, it again goes back to the fundamental 
question: can we develop methods of capturing the carbon? Most 
of the cost is in actually the capture. It is not in the 
storage. The storage and monitoring are--I know a couple of my 
personal friends who are experts in this, and we have been 
doing experiments on a couple of million tons a year in various 
sites around the world. And the Department of Energy is 
sponsoring more in the sequestration part, whether it can be 
done safely, adequately monitored. But it is the capture part 
that is the real cost, and we have got to figure out ways of 
doing that better.
    Mr. Wilson. Thank you, Mr. Secretary. Thank you, Mr. 
Chairman.
    Chair Gordon. Thank you, Mr. Wilson. What we have all been 
waiting for, Mr. Rohrabacher is recognized for five minutes.

                  Skepticism of Global Climate Change

    Mr. Rohrabacher. Thank you, Mr. Chairman, and happy St. 
Patrick's Day to us all. Mr. Secretary, it really is refreshing 
to hear your testimony today, and I look forward to working 
with you in the years ahead and am very pleased with your 
appointment to this important position. But let me not 
disappoint my Chairman by noting that it has now been seven 
years since there has been any warming recorded on the planet. 
That is why I guess people have changed the wording to--now it 
is not global warming, now it is, you know, something to do 
with climate change. There are prominent scientists, more and 
more prominent scientists, every day joining the ranks of those 
who are suggesting that the whole global warming theory is 
bogus, and I would add 10 names of prominent scientists which I 
will at every one of our hearings who are now joining the 
ranks, prominent scientists, heads of major university science 
departments throughout the world, and I will now submit a list 
of 10 of those names for the record.
    Chair Gordon. Without objection.
    Mr. Rohrabacher. Thank you.
    [The information follows:]
                      List of Names for the Record
                   from Congressman Dana Rohrabacher
    List of ten scientists who refute the theory of Anthropogenic 
Global Warming (AGW)

         1.  Geophysicist Robert Woock, senior geophysicist at Stone 
        Energy in Louisiana, Past President of the Southwest Louisiana 
        Geophysical Society, Master's in geology: ``I do not see any 
        evidence in nature or data to suggest that we are in any 
        anthropologic climate cycle.''

         2.  Senior Chemist Glenn Speck

         3.  Hungarian Physicist and environmental researcher Dr. 
        Miklos Zagoni: ``Anthropogenic greenhouse gas emission cannot 
        generate global warming, neither in the past, nor in the 
        future.''

         4.  Paleontologist Dr. Eduardo Tonni, the principal 
        investigator for the Committee for Scientific Research of the 
        province of Buenos Aires (CIC) and head of the Paleontology 
        Department at the University of La Plata

         5.  Senior Meteorologist Dr. Wolfgang P. Thuene: ``The 
        hypothesis of a natural and a man-made `greenhouse effect,' 
        like eugenics, belongs to the category `scientific errors.' ''

         6.  Physicist F. James Cripwell: ``AGW (Anthropogenic Global 
        warming) is a myth.''

         7.  Hydrologist and geologist Mike McConnell

         8.  Meteorologist Brad Sussman: ``Believing that mankind is 
        unequivocally responsible for global warming is the ultimate 
        arrogance.''

         9.  Meteorologist Peter R. Leavitt: ``There is insufficient 
        hard evidence to conclude that AGW is a significant factor in 
        climate if it is a factor at all.''

        10.  NASA Astronaut and Physicist Walter Cunningham

    Mr. Rohrabacher. Thus, cap-and-trade and carbon 
sequestration are wastes of money. They are aimed at the global 
warming theory. However, your efforts for energy, self-
sufficiency, and protecting the health of human beings by 
having cleaner fuels is certainly appreciated here, and I will 
be very happy to work with you on those areas in the future.

                  Nuclear and Space-based Solar Energy

    Let me note for a couple of examples, I would draw your 
attention to the work done at the University of California at 
Davis which is aimed at biotech and the production of energy in 
that way. I would also call your attention--and again, I very 
much appreciate your openness to nuclear energy, and I would 
suggest that one way we can have cooperation internationally, 
to cut down the cost of getting to the point where nuclear 
energy is brought back on line, is the development of the high-
temperature gas-cooled reactor which lends itself to 
cooperation with the Russians and gets rid of a lot of the 
problems we talked about including the Yucca Mountain problem. 
In fact, there would be less waste stored at Yucca Mountain if 
we used high-temperature gas-cooled reactors.
    And finally, let me mention to you and your attention to a 
report that I have here which is a report that suggests that 
space-based solar power could be brought into service in a very 
cost-effective way. We could use it to provide energy to third-
world countries without having to build huge plants in those 
third-world countries, we could provide energy for our military 
in emergency situations, and I might suggest that this 
committee would be able to work with you because we also 
oversee NASA, and it would be also be an area of great 
international cooperation again with the Russians to build 
space solar-powered units that could provide clean electricity 
for the world.
    Those are just a few thoughts. I wondered if you had any 
thoughts in space solar power and the high-temperature gas-
cooled reactor?
    Dr. Chu. With space-based solar power, I know I think it is 
Marty Hoffert who is a big fan of this. I will be frank. I am a 
little bit skeptical. Anything you put up in space costs a lot 
of money.
    Mr. Rohrabacher. You know, the Russians have cheap ways of 
getting things into space. We should be trying to develop our 
own cheap ways of getting into space. How about the high-
temperature gas-cooled reactor?
    Dr. Chu. High-temperature gas-cooled reactors is something 
we should and will be looking into because it also--if there 
are really high temperatures, it opens up the possibility of 
generating hydrogen, and the hydrogen is like a battery, quite 
frankly.
    Mr. Rohrabacher. There is a high-temperature gas-cooled 
reactor, the only one I know functioning, in Japan.
    Dr. Chu. Right.
    Mr. Rohrabacher. I visited that facility and would suggest 
that it really offers a lot of promise.
    One last thing. There are a lot of other ideas that offer 
great promise to producing clean electricity, and I might add 
again, I could care less about--I believe the global warming 
theory is bogus, but clean energy to protect people's health 
and to provide energy self-sufficiency is a great goal which 
you can count on cooperation from all of us. There are things 
developed--just one last concept--there is a fellow out in 
California, Mr. Chairman, that has a paint that is based on 
nanotechnology. I have been encouraging this company in this 
development that will make houses into solar collectors which 
are much more efficient even than photovoltaic cells. Have you 
heard about this?
    Chair Gordon. We will have to hear about it later, if that 
is okay.
    Mr. Rohrabacher. Thank you.
    Chair Gordon. Mr. Rohrabacher, you never disappoint. I 
thank you for being here. Let me, if I could, maybe lay out 
some rules of the road for the rest of the hearing if no one 
has an objection. We had told the Secretary that he could be 
able to get out by noon, but we are going to impose upon him to 
stay for another 15 minutes until a quarter-after. So, you 
know, we want to try to be crisp. Unfortunately I have another 
obligation, and Mr. Wu is going to take over here.
    Let me just say, Mr. Secretary, again, thank you for being 
here. At first view, someone might not think that you are all 
that exciting, but this has been a very exciting hearing and 
exciting topic, and it is going to be fun moving forward with 
you. Mr. Lipinski is recognized.
    Mr. Lipinski. Thank you, Mr. Chairman. Is this microphone 
working? It is working, isn't it? All right. I will try to stay 
away from, you know, I want to get up and start wandering 
around. Now I have this microphone. But let me say, Dr. Chu, I 
have been trying to figure this out. People call you Dr. Chu, 
Mr. Secretary. I think maybe Dr. Secretary, I don't know of 
that is the correct way to refer to you, but I was excited when 
you were nominated to be the Secretary of Energy. I know that a 
couple years ago, I think it was about two years ago, I sat 
down with you at Lawrence Berkeley Lab. You came to visit, we 
had lunch, and at that time I was very impressed by, you know, 
obviously with, you know, Bell. Your knowledge of--your field 
is great, but on top of that, much more importantly, especially 
in this job, is your ability to really very fluently discuss 
and understand and deal with the policies. So I was excited 
when you were named the Secretary of Energy.

            Plans for Research and Development Collaboration

    I wanted to bring up something that we had talked about, 
start out about something we had talked about during that lunch 
and it was brought up earlier, was the Energy Biosciences 
Institute, a collaboration between the Lawrence Berkeley 
Laboratory (LBL), University of Illinois at Urbana-Champagne, 
and BP. I think that this integration of the national labs, 
universities, and industry are very critical. I know you feel 
the same way, and in your confirmation hearing you stated that 
DOE will better integrate national lab, university, and 
industry research. So I wanted to throw a general question out 
to you about what specifically do you want to do at DOE? What 
do you want to see DOE do differently maybe including funding 
initiatives or models in order to make this collaboration 
really work well? And let me throw this other question out 
there while we are on this issue. We want to integrate 
universities and labs along with industry, but what about any 
problems or real competition to some extent between 
universities and the labs? Because that is also an issue that 
sometimes does come up. But I am just interested in what you 
would like to see and what your plans are at DOE to help this 
collaboration.
    Dr. Chu. Well, in terms of the further integration of 
industry with universities and with the national labs, I would 
like to see consortia of companies or individual companies 
actually work with scientists at these universities actually 
develop the intellectual properties together. That goes a long 
way. So a very quick story. I was asked to go and give a 
dedicating speech for Dow Chemical in Midland. So I flew over 
there, gave a speech, and talked to the chief technology 
officer, CEO, and others, and then they came over to the 
Lawrence Berkeley Lab. We decided that we had a lot in common, 
so they came over and chatted a little bit more and said, well, 
look. This is no good if I am just talking to the chief 
technology officer. We have got to get our scientists and 
engineers to talk to each other. So the next time they came 
over, we had a one-day thing where the scientists or engineers 
from Dow would talk about their four talks and they would talk 
about their projects, and the people at the University of 
California-Berkeley and Berkeley Lab which is very integrated--
actually, roughly 270 of our scientists are professors at UC--
listened and said, so the intent was, this is what Dow is 
interested in developing. Do we have some knowledge that can 
help them? And to make a long story short, one of the chemists 
at Dow said, we like to make water-soluble products. We don't 
want to water in our processes because water absorbs a lot of 
heat, it undergoes phase changes, all that loses energy, and we 
are trying to drive out the energy costs. So we actually don't 
want our processes to use water because you have got to recycle 
the water anyway. You can't just dump it out. So we would 
rather use organic liquids.
    So I leaned over to one of our chemists. Did you know that, 
you don't want water in your processes? No. And how would they? 
They go to the sink, they turn the tap, and water comes out 
free.
    So when we start or when people in universities start to do 
research, again, it goes back to manufacturability, it goes 
back to industrial processes. Industry actually knows a lot 
more about those things. And so rather than go down a line and 
develop intellectual property that ends up being not very 
practical from an industrial point of view, let us get them 
together early. And so this is what I mean by industrial 
collaboration. We were working industrial collaboration with 
United Technologies to try to put together a consortium of 
companies that pre-IP,\3\ this is pre-competitive research that 
all companies can use for building efficiencies that could work 
with Berkeley Lab and UC-Berkeley, again with the same idea in 
mind. So it is things like that, I think, we have the 
opportunity to work on.
---------------------------------------------------------------------------
    \3\ Intellectual Property
---------------------------------------------------------------------------
    Mr. Lipinski. I thank you and I look forward to working 
with you. I also want to--I won't do it now, but at some time 
in the near future, I would like to talk to you about the 
Advanced Battery Manufacturing program funded in the American 
Recovery Act, and as I look forward to working with you even 
though you did go from Stanford to Berkeley, I won't hold that 
against you. Yes, I was a Stanford grad.
    Dr. Chu. Well, I have loyalties in both institutions as you 
must know, deep loyalties in both.
    Mr. Wu. [Presiding] Divided loyalties. Dr. Chu, let me 
assure you that I find you very exciting. Next the gentleman 
from Georgia, Dr. Broun. And let me just mention to Members 
that although you have the absolute ability to take your full 
five minutes, if you want to consider your fellow Members and 
take two or three minutes instead, then we will be able to get 
through all of the folks who are asking questions by 12:15. Dr. 
Broun, please proceed.
    Mr. Broun. Dr. Secretary, do you realize that there is 
absolutely no, in fact zero, consensus in the scientific 
community about human-induced global warming?
    Dr. Chu. No, I don't. I beg to differ, actually.

                       More Climate Change Denial

    Mr. Broun. You are absolutely dead wrong, Mr. Secretary. 
There are a tremendous number of scientists who would 
absolutely debunk any human causes of global warming, and I 
think just for scientific integrity, I ask that you go and look 
at those things because there is no consensus. Are you and this 
Administration absolutely determined to shut down the U.S. 
economy, to put people out of work, markedly raise the prices 
of food, medication, all goods and services which will 
particularly hurt people on a limited income and the poor, to 
pursue a policy, this cap-and-trade, I call it cap-and-tax 
policy, that is not only questionable scientifically but in 
fact has been shown scientifically that human activity and 
carbon dioxide release has very minimal if any at all 
significant effects on global warming. Are you all so 
determined that you are going to shut down the economy and hurt 
these folks to pursue these kinds of policy?
    Dr. Chu. Well, the primary goal in this Administration 
first and foremost is to get the economy going again, that the 
unemployment rates of exceeding eight percent are very, very 
scary, the shut-down of the credit markets. All these things 
are very, very scary. I mean, one out of twelve Americans is 
now out of work. And so first and foremost, we need to restart 
the economy because there is a lot of pain out there.
    Now, given that, I don't think, seriously disagree--that 
what we are trying to do in the Economic Recovery Act is to 
start to build the United States toward more energy 
independence, toward much more efficient use of energy and 
developing new sources of energy, rebuilding--add to the 
transmission and distribution and infrastructure. All those 
things are also increasing the investments that will help the 
economy restart. In addition to that, it helps in the overall 
goals of our economic prosperity, our working toward foreign 
oil dependency, decreasing that, and getting off the 
dependency, and the environmental issues.
    We do apparently have fundamental disagreements on what the 
science is saying. Let me just say in terms of that that 
science is a very peculiar sort of thing in that if a scientist 
comes along and disproves what most of the scientists think and 
it turns out to be right, that scientist is actually hailed as 
a hero. I mean, that is the fundamental structure of science. 
Einstein comes along and says Newton was pretty good, but he 
got some things wrong in certain areas of very high velocities, 
for example, or high gravitation. He is a hero. People who 
developed quantum mechanics similarly. They overthrew the 
prevailing view, and they get Nobel prizes for that.
    So the protection of science and the truth will come out in 
the end is because of that fundamental issue. And so yes, if 
scientists come forward and show that this is all wrong, they 
will be heroes. People are constantly checking and doing 
things. But again, when I started to look into this maybe six, 
eight years ago, started as an amateur but read more and more 
about it, I became more and more convinced that these are very 
real issues.
    Mr. Broun. Well, sir, I am a physician. I am a scientist. I 
am an applied scientist, and I believe in scientific integrity. 
If you will look at a lot of other writings that are peer 
reviewed, there are many sources of data that show that human-
induced global warming is a myth. And I request that you take 
off your blinders and bias and look because there are many, 
many scientists who would debunk this whole idea, and it is 
going to kill our economy and it is going to particularly hurt 
poor people and people on limited incomes. And to go down this 
track is going to kill our economy. We are spending too much, 
we are taxing too much, we are borrowing too much, and we have 
just got to stop it. I think everybody on this committee, 
everybody in Congress wants to see the economy going again. But 
going down this track of cap-and-trade or cap-and-tax is the 
wrong way to go. Thank you, sir.
    Mr. Wu. I thank the gentleman. The gentleman from Kentucky, 
Mr. Chandler.

                    Electric Vehicles and Batteries

    Mr. Chandler. Mr. Secretary, congratulations to you and 
best regards from your friend, Lynn Peters, back in Kentucky. I 
would like for you if you could to talk a little bit about 
electric cars. Do you believe that they are indeed the future 
of our personal transportation system, and could you give us a 
little bit of a timeline on the development of them, 
development of batteries, development of distribution system, 
et cetera. Thank you.
    Dr. Chu. Okay. Very quickly, yes, I think electric cars 
have great promise because most people, they are not going to 
work for long-distance travel. They are not going to work for 
long distance transportation, but most Americans I have 
understood travel typically 40 miles or less, 50 miles or less 
per day to and from work. So if you can get electric vehicles 
that have a range of 48 miles with some back-up, that could 
off-load a lot of the oil we import, a significant amount of 
it, and give us more options for generating electricity. It 
also by the way allows a dual use in that if you have solar 
panels on your roof, for example, you can charge up your 
battery of your car. It allows you to buy energy at nighttime 
when it is very inexpensive, there is excess capacity, and use 
that. And so the investments in power generation--so there is a 
lot of very good things about electric vehicles.
    You put your finger right on the nub of the issue, the 
battery. All the other parts we know how to do very well, and 
right now we don't have batteries that can survive deep 
discharges. You know, the Prius battery is held between 40 and 
60 percent of full charge the entire lifetime of the battery, 
and usually actually much tighter for most of it, 55 to 45 
percent because if you deep discharge the batter--well, we do 
the experiment on our laptop computers. After a couple of years 
of deep discharging, guess what? It is holding half the energy. 
And that is bad because right now, the cost of batteries is 
quite high as well. You know, the estimates for example of the 
Chevy Volt, that battery that give you that 40-mile range, will 
be of scale, $10,000, $12,000. So that battery is a significant 
part of the total cost of the car, and it better last the 
lifetime of the car.
    So now, the good news is I know some battery research that 
has promise. There are great opportunities once you--in a 
former life before I took this job, I was actually on to be 
signed to the board of a battery start-up company. And there 
are certain areas which actually have an incredible amount of 
progress that can be made, batteries that could be inherently 
much safer, safer in the sense that they won't go in these very 
high-temperature fires. This particular company developed an 
electrolyte, that is to allow the lithium ions to go across, 
that is inherently non-flammable. If you can create a much 
safer battery, that also will drive down manufacturing costs a 
great deal because it is the very tight manufacturing 
tolerances of our current lithium-ion technology that drive the 
costs way up.
    The materials, the cobalt that is used on the cathode side, 
we need to substitute. There are real opportunities in 
batteries that I see that could give this factor of two or 
three in energy density and make it much less flammable. That 
means you ease up on the very tight manufacturing tolerances 
that would drive down the cost as well.
    So I am actually hopeful, but you know, you are asking me 
to predict when this new generation battery will occur. All I 
can say is again, going back to this other view that people 
are--batteries are a big deal, not only for cars but for large-
scale energy storage for residential storage, for building 
storage because if we can get the batteries, and going to your 
point originally that there are a lot of applications for 
batteries. Even to level out the transience when clouds roll 
over a solar farm or the wind stutters a little bit, you 
actually need batteries. So there are many, many applications. 
And one of the things I would like to do is not only invest in 
batteries for cars but batteries for all these other 
applications.
    Mr. Chandler. It has been very informative.
    Mr. Wu. I thank the gentleman. The gentleman from Florida, 
Mr. Diaz-Balart.

                       More on Emissions Trading

    Mr. Diaz-Balart. Thank you, Mr. Chairman. I want to thank 
you also, sir. I agree with Mr. Wu, and you have actually been 
attempting to answer the questions. I really appreciate that.
    I think we can all agree that reducing emissions, reducing 
pollution, reducing foreign sources of oil and helping the 
economy as you mentioned, particularly helping the economy is 
essential to any policy that we pursue. I want to talk a little 
bit about cap-and-trade as is in the President's proposed 
budget or as Mr. Broun referred to as cap-and-tax. I want to 
throw some facts out there that a number of different groups 
put out, and I think there is pretty much a consensus. Many, 
including the EPA, and many others estimate that there would be 
a decline in GDP if cap-and-tax is implemented. A number of 
groups estimate that it would be a loss of millions of jobs. 
Again, a number of different groups. Just about everyone 
understands and there is a consensus that cap-and-tax or cap-
and-trade will increase electricity rates, you mentioned that 
yourself a little while ago, on American families, on American 
businesses, by anywhere between 44 to 129 percent which by the 
way is way above what the President is proposing to subsidize 
some families in his budget. So they are way above that. 
Gasoline price increases between 61 cents and $2.53 per gallon. 
Natural gas cost increases between 108 percent and 146 percent. 
To sum it up best, you know, the President's own OMB 
directorate who used to be at CBO stated September 18, ``Costs 
will be passed along to the consumers in the form of higher 
prices for energy.'' I don't think that is debatable. Again, 
that was Mr. Orszag. He also stated that a 15 percent cut in 
CO2 emissions, which by the way is 80 percent less 
than as signed in the President's budget, would be an average 
annual household cost of $1,300. These are substantial numbers. 
So these are some of the facts.
    Now, you stated in your testimony in answering the 
questions, by the way, which I think are right that the United 
States by the way can't do this alone. Obviously China being 
the big, 800-pound gorilla as far as the CO2 
emissions. Associated Press today has an article where they 
quote that the Chinese Director of Climate Change at the 
Department of Climate Change saying that no, China will not be 
charged for that, that the U.S. importers of products made in 
China that produce high CO2 are going to have to pay 
the cost, in essence.
    So look, in essence, like you mentioned, you know, it is 
good to be cool to be energy efficient. Clearly, quoting 
another one of those sayings, China just said no, one more 
time. This is the same China that just recently harassed the 
U.S. military ship, the same China that murders dissenters. We 
know who we are dealing with.
    So here is the question. That being the case and you stated 
in other words, I don't want to put words in your mouth, but 
obviously we can't do it alone, China being the big player, 
will this Administration then change the policy regarding cap-
and-trade or cap-and-tax or will it go forward regardless of 
those facts on how it will affect the economy and particularly 
if China says no, you know, we are not going to play? And how 
will policy be guided by the cost on the U.S. economy and the 
U.S. family, regardless? Because again as I said, that that 
partial subsidy just won't cut it. The numbers are there. They 
are really pretty plain. So will this Administration and will 
you look at all those facts, and are you willing then to take a 
step back and say we are not going to do this because the price 
is too high, the economic price is too high, and China just 
won't play?
    Dr. Chu. Well, I----
    Mr. Diaz-Balart. China and others, I guess, too. It is not 
only China. China is the big one, but there are a lot of others 
that----
    Dr. Chu. Well, there are two 800-pound gorillas when it 
comes to carbon emissions, China and the U.S., I think, two 
countries together--China recently passed the United States, 
but those two countries emit approximately half of all the 
carbon in the world.
    I am not--I don't--you know, my understanding of the costs 
are far less. I do know the IPC and also IPCC in its latest 
report and also the Stern Review report that Nicholas Stern 
chaired, those two reports estimate a larger coal carbon 
emissions down to a level which the climate scientists feel is 
prudent. Risk management is somewhere between one and two 
percent of GDP. Now, the cost of one or two percent of GDP is 
not insignificant by a long shot. That is a lot of money. But 
then you have to weigh that against what could possibly happen 
if we did business as usual. So then it becomes an issue of 
what those potential risks could be. And while one can't say 
with 100 percent certainty that such-and-such will happen, it 
is again talking about probabilities.
    Mr. Diaz-Balart. I am sorry, sir, but we can say with 
certainty the cost to the economy. I mean, that we can say.
    Dr. Chu. That is true.
    Mr. Diaz-Balart. Okay.
    Dr. Chu. So let me--risk management in the following sense. 
One can't say with certainty that your house will burn down. In 
fact, in most cases, your house does not burn down and yet we 
all have fire insurance because it is part of that because 
should disaster strike, it is very important. So let us pretend 
there is an 80 percent certainty that the western part of the 
United States will lose a lot of its pine forests and there 
would be less snow pack, therefore less storage of water, the 
economic cost of that could be much, much higher. It would be 
much, much higher. And so it is not 99 percent certain, but say 
it is 80 percent certain and we as a country will have to 
decide whether we want to pay this extra money, and it is real 
money to invest. And so that is really the issue that----
    Mr. Diaz-Balart. But again, how about the issue of China 
saying no?
    Dr. Chu. China saying no to what?
    Mr. Diaz-Balart. To them paying for--I am sorry, Mr. 
Chairman but I am--they are basically saying no, the United 
States has to pay for our emissions.
    Dr. Chu. I think it is very important that all countries, 
developing countries and developed countries, start to limit 
their carbon.
    Mr. Diaz-Balart. But if they say no, do we continue to 
pursue this policy or do we not?
    Dr. Chu. I think I am actually optimistic that China--
because China realizes that the consequences of climate change 
are very real to their country as well, the economic cost.
    Mr. Diaz-Balart. But if they say no was my question.
    Dr. Chu. We talked about in terms of international trade, 
of adjusting duties as a way because again, we don't want to 
disadvantage our industries at home.
    Mr. Wu. I thank the gentleman and the Secretary. We are 
running hard up against Chairman Gordon's 12:15. I want to give 
Mr. Tonko his five minutes, but if he would proceed quickly, 
and if it is possible for the other three Members who are here 
to ask something quickly with the Secretary's forbearance?
    Dr. Chu. Sure.
    Mr. Wu. Thank you. Mr. Tonko, the gentleman from New York.

              Battery Development and Advancing Efficiency

    Mr. Tonko. Thank you, Mr. Chairman, and Secretary Chu, 
thank you for joining us today. I do believe that President 
Obama expressed great leadership when he nominated you to be 
Secretary, and I am empowered for all energy consumers by your 
appointment. I share the vision that President Obama and you 
have etched for this nation in terms of innovation as it 
relates to energy, and I particularly appreciate the boldness 
with which you have expressed that vision and the laser-sharp 
focus. I appreciate the research and development impacts you 
think we need to continue and deepen, and certainly one who 
expressed a concern for energy efficiency so that we can focus 
on demand-side solutions rather than just supply-side.
    Quick question. On advanced battery technology of which you 
spoke and rightfully for transportation sectors and for energy 
generation and other aspects, what is your thinking in terms of 
diversifying that sort of battery technology? Should we go down 
the path of one type of battery or should we make it the 
efforts, the mission, of your agency to encourage 
diversification amongst battery technologies?
    Dr. Chu. Definitely diversification. You know, we intend to 
find what we think are the most promising ideas. No, we don't 
want the whole world marching toward, you know, incremental 
improvements of a specific technology. Absolutely, we want--and 
so again, it actually goes to the issue of different types of 
batteries for different uses as well.
    Mr. Tonko. Thank you. And also with energy efficiency, I 
served as Chairman of the Energy Committee of the New York 
State Assembly for 15 years and then went on to become 
President and CEO of NYSERDA, the New York State Energy 
Research and Development Authority. All of the work we have 
done in efficiency, not just for manufacturing but businesses 
of all kinds, but dairy farms, where tremendously powerful 
statements that reduced the demand. We are per capita one of 
the most gluttonous, the most gluttonous societies in terms of 
fossil fuel consumption. The efficiency in the stimulus package 
is encouraging, but I know it is a function of resources. We 
need much more. What are your thoughts on how we can best 
advance the efficiency agenda?
    Dr. Chu. I think part of it is helping people realize just 
how low-hanging this fruit really is, or as I like to say, it 
is fruit on the ground, ready to be picked up. Let me just give 
you one example. Refrigerator standards, the energy-efficient 
refrigerators from the 1975 until today, the energy consumption 
in the refrigerator, went down to only 25 percent of the 
refrigerators of 1975. Had we been using those inefficient 
refrigerators of 1975 today, we would be using a lot more 
energy. How much? More energy than all the renewables than we 
produce today.
    Mr. Tonko. Thank you. Just a final comment. I would 
encourage us to strongly focus on developing resources for 
energy retrofits, efficiency retrofits for our workplaces and 
our homes. But thank you very much for your leadership.
    Mr. Wu. I should have known better than to expect public 
servants and a professor to be brief. The gentleman from South 
Carolina, Mr. Inglis.
    Mr. Inglis. Thank you, Mr. Chairman.
    Mr. Wu. Quickly, please.

                Alternative Emissions Pricing Structures

    Mr. Inglis. Dr. Secretary, thank you for your service. You 
know, I wonder if even we could stipulate to the folks that say 
there is no climate change, even if that is true, perhaps we 
could get them to come along to try to break the addiction to 
oil and to create the jobs of the future by doing what they 
know or will soon find out, I think has to be done which you 
have to internalize the externals associated with some fuels 
that we use. And if you do that, then we unleash the power of 
the marketplace to do what those who we have heard from today 
who don't think there's any climate change, nevertheless want 
to do, which is see the private sector succeed.
    I wonder if the best way to do it, though, is not by cap-
and-trade which we have already heard tagged as a tax increase 
and a system that will trade credits that when Wall Street is 
not very favored right now, and it got 48 votes for cloture in 
the Senate before all of that, before a recession and before 
the Wall Street disasters. I wonder if a revenue-neutral carbon 
tax that is transparent, that starts with a reduction of taxes 
in payroll, creates no additional take to the government and 
that does what you very wisely pointed out has a bolder 
adjustment so that we don't disadvantage American manufacturing 
vis-a-vis other manufacturers, I wonder if that is our 
collaboration opportunity to go forward to a solution for 
America even with folks who doubt the underlying premise of 
climate change. Do you think it is possible?
    Dr. Chu. Well, I think the Administration is very strongly 
going toward cap-and-trade and supports cap-and-trade, and 
there are other issues for wanting to do that. Let me just say 
that Europe is going this way, and so whatever we do, we have 
to interface with the rest of the world community to make these 
programs look similar. But as you correctly said, it is about 
incorporating all the external costs of our energy into the 
product we buy, just as when we decide we are going to treat 
sewage. Does it increase the cost of water? Absolutely, but the 
overall cost actually goes down because the consequences of 
putting untreated sewage in a river downstream are much, much 
higher than just treating the sewage. It is also true of sulfur 
dioxide, that it does increase the cost, but it doesn't really. 
It puts the cost actually where it should be, in the project 
itself.
    And so I think we are in total agreement. But you know, I 
think cap-and-trade has the advantage, at least one advantage, 
and that is it is easier to interface where the rest of the 
world is going.
    Mr. Inglis. Thank you, Mr. Chairman.
    Mr. Wu. I thank the gentleman. The gentleman from New 
Mexico, Mr. Lujan. Two minutes each for the last two questions, 
please.
    Mr. Lujan. Thank you, Mr. Chairman. I don't think I will 
take that long. Mr. Secretary, it is an honor to be here with 
you today as well. I recently extended an investigation to 
visit Los Alamos National Laboratories, and I hope that we can 
begin to engage in a dialogue on when we can get you out there 
to really highlight some of the areas where there is research 
taking place in Los Alamos and the areas of sciences with 
global climate change, super-capacitor energy storage, hydrogen 
fuel cell technology, and carbon sequestration. What I want to 
emphasize though, Mr. Secretary, is the reason that we are here 
today which is with the emphasis of this committee hearing is 
in the new direction for energy research and development for 
the U.S. Department of Energy. I applaud the efforts of 
yourself and the Administration and the team that has been put 
together that has embraced science and technology, not for any 
other reason use science and technology to prevent progress but 
to encourage progress, to advance job creation, not eliminate 
job opportunities as we move forward with the economy and the 
economic conditions that we are facing as a nation.
    Mr. Chairman, I will submit my question specifically to the 
Secretary for consideration later, but Mr. Secretary, we are at 
a critical time right now, and with your courage and based on 
science and technological advances, the work that can be done 
to get us on a right footing and to make sure that this nation 
has a foundation in order to become a leader in the world 
before others will follow, is something that I really 
appreciate, and I look forward to working with you. Thank you, 
Mr. Secretary.
    Mr. Wu. I thank the gentleman. The gentleman from Florida, 
Mr. Grayson.

                             Fusion Energy

    Mr. Grayson. Thank you, Mr. Secretary, and thank you, Mr. 
Chairman. If we had commercial fusion power today, we would 
have energy independence, we would reduce or eliminate oil 
imports, and we would have no CO2 emissions at all 
from that particular source of power.
    Now, in the case of fission, we went from military 
applications to commercial energy applications in less than 10 
years. In the case of fusion which had military applications 
for 50 years and we are still waiting for those commercial 
applications, despite 50 years' worth of effort. We have lost 
our lead in fusion research to the European Union, and now we 
are number two at best in an area that is bound to be an 
important part of the 21st-century economy. And I am wondering 
if the reason is simply money. I understand it has been 
estimated that $100 billion would be enough to develop the 
commercial application of fusion energy and to free our economy 
from the dependence on mid-East oil. $100 billion is less than 
we spent on the AIG bail-out, it is less than one year of the 
cost of the war in Iraq, and if that were the case, then we 
would be free for all time.
    I am wondering, Mr. Secretary, do you favor a Manhattan-
project style approach to this problem that would dramatically 
increase our spending on fusion energy in order to make us 
energy independent?
    Dr. Chu. I support a Manhattan-style investment of this 
country and the world in all the parts of energy supply and 
demand that can reduce--you know, so that we can as a world 
transition to a sustainable use of energy.
    Fusion is a difficult question because it is a very long 
time scale. They are very hard problems, and I think 
dramatically increasing the budget for fusion, right now the 
International Thermonuclear Experimental Reactor (ITER) project 
has a path to go. It is still an experiment, and ultimately 
even if ITER works very, very well, there would be then as 
anticipated a so-called demo-style type of thing, still a pre-
deployment thing but getting on the way to there. And the time 
scale for that is you know, sort of mid-century. And it depends 
on ultimately the cost of fusion. If we can get fusion's cost 
down, that is the real issue. First we have to show that you 
can do more than break even, that it really is going to give a 
lot of yield. There are other prospects. The one they should be 
looking at I think is these so-called hybrid solutions of 
fission and fusion. The fusion creates high-energy neutrons 
that are used to convert a lot of the radioactive fuel and burn 
down the long-lived radioactive isotopes. So there are 
prospects like that. But ultimately, there is a timeline. If 
we, you know, increase the funding by a factor 10, will we get 
there 10 times faster? I actually think not. You know, it is a 
very, very hard nut to crack in terms of getting the 
controlled, sustainable fusion that we need. And it has to be 
economically viable.
    And so we are not there yet in terms of even--you know, so 
I am all for continuing to do research in fusion. I am all for 
looking at, you know, out of left field new ways of doing 
fusion. I mean the ITER project, the toka mak-style thing is 
one possibility. You know, the path of that has now been 
charted, and the world is following that but there may be other 
opportunities.

                                Closing

    Mr. Wu. I thank the gentleman, and I thank the Secretary. 
And before we bring the hearing to a close, I want to thank Dr. 
Chu for testifying before the Committee today. The record will 
remain open for two weeks for additional statements from the 
Members and for answers to any follow-up questions the 
Committee may ask of the witness. The witness is excused, and 
the hearing is now adjourned.
    [Whereupon, at 12:27 p.m., the Committee was adjourned.]
                               Appendix:

                              ----------                              


                   Answers to Post-Hearing Questions




                   Answers to Post-Hearing Questions
Responses by Steven Chu, Secretary of Energy, U.S. Department of Energy

Questions submitted by Chairman Bart Gordon

Q1.  There is a significant problem with integrating and coordinating 
related research, development, and demonstration activities across the 
Department. In particular, the applied research programs, like solar 
and biofuels R&D efforts in the Office of Energy Efficiency & Renewable 
Energy, are not well integrated with the Office of Science's more 
cutting-edge programs in the same areas. I know you recognize this is 
as a serious issue and are planning to address it in both existing and 
new programs. However, while, such initiatives are a good start, I 
believe that one critical step in mitigating this problem is to have 
all basic and applied energy R&D programs report to a single Under 
Secretary, as was the intention when the Under Secretary for Science 
was first proposed as the Under Secretary for Energy & Science. This 
would also allow the other Under Secretary to focus entirely on 
Environmental Management, Legacy Management, and Civilian Radioactive 
Waste Management, which has thus far occupied the vast majority of that 
Under Secretary's time. As noted in a letter sent to you on March 9, 
2009, the Committee counsels have found that you already have the legal 
authority to do this. What is the logic in keeping these programs 
separate under different Under Secretaries when you have the discretion 
to realign them?

A1. One of my highest priorities is a tighter coupling between 
Department's basic and applied research activities. The best 
organizational model to accomplish that depends upon the tasks at hand, 
the particular individuals on the leadership team, and the ``culture'' 
established for that team.
    Most importantly, I have established a highly collaborative senior 
leadership team and am working with them to propagate that style and 
attitude throughout the Department. This alone should be very effective 
in promoting integration, independent of the particular roles and 
responsibilities among the leadership team.
    In addition, the responsibilities of the Under Secretary for 
Science currently follow those recommended by the 2003 Secretary Energy 
Advisory Board Task Force on the Future of Science Programs:

         The Under Secretary for Science would have both Department-
        wide and line responsibilities. He or she should serve as the 
        chief science officer for the Department as a whole, overseeing 
        the science officers within Department's missions. As chief 
        science officer, the new Under Secretary will require a 
        crosscutting Department-wide forum to coordinate and integrate 
        science across the entire Department. The Department of Energy 
        should consider emulating crosscutting management structures 
        used by other federal agencies to assist their chief scientists 
        or chief engineers to coordinate and integrate department-wide. 
        The Under Secretary for Science would also have line 
        responsibility for the Office of Science, which might report to 
        him or her through an Assistant Secretary.

    The role is thus designed to promote integration of all basic and 
applied research across the Department, including that in the NNSA 
(consistent with classification considerations).
    I will, of course, closely monitor the extent to which these steps 
are having the desired impact and will not hesitate to make changes as 
might be required in the future.

Q2.  DOE is unique in maintaining a large internal bureaucracy to 
regulate its own environmental, safety, and health performance. While 
the cost of such a regulatory regime is considerably higher than it 
would be at a comparable non-DOE facility, there is no indication that 
this makes DOE facilities demonstrably safer. As a test case at 
Lawrence Berkeley National Laboratory demonstrated several years ago, 
applying external regulatory oversight to DOE's non-nuclear weapons 
laboratories could reduce costs and remove inherent conflicts of 
interest, chiefly by transferring DOE's worker safety compliance role 
to OSHA and the nuclear safety compliance role to NRC. Do you have 
plans to implement external regulation to the Department's non-weapons 
research and oversight activities? If not, please provide the rationale 
for maintaining DOE's self-regulatory regime, and include documentation 
demonstrating that it is the most cost-effective way to ensure optimal 
environmental, safety and health performance.

A2. Prior to my role as Secretary of Energy, I was the Director at 
Lawrence Berkeley National Laboratory, so I am personally familiar with 
the costs and impacts on operational efficiency that can result from 
bureaucracy, overlapping oversight, and overly-restrictive 
requirements. As Secretary of Energy, I am firmly committed to 
improving business efficiency and reducing overhead within DOE. As I 
have stated on several occasions, increased efficiency, particularly in 
our national laboratories, is essential as one means of making more 
resources available for key energy programs that are important to the 
national economy, environment, and energy security.
    It is important to recognize that DOE has achieved an exemplary 
safety record through its current regulatory approach. For example, 
DOE's injury and illness rates have shown a continuous downward trend 
since 1996 and DOE sites have achieved and sustained injury and illness 
rates that are significantly lower than the rates for comparable 
industries. In fact, DOE injury and illness rates are as good as the 
best-in-class for comparable commercial industries.
    The question of external regulation of DOE sites and laboratories 
was extensively evaluated in the 1995-2002 timeframe, including the 
pilot program at the Lawrence Berkeley National Laboratory in the 1997-
1998 timeframe. As I understand it, the potential cost savings, 
potential benefits, potential impacts, and transition costs were a 
matter of considerable debate, and Congress and DOE ultimately made the 
decision not to pursue the external regulation option, citing the 
questionable benefits and transition costs. Instead, DOE took a number 
of actions intended to improve DOE's regulation of environment, safety, 
and health at DOE sites and laboratories. As one important example, DOE 
replaced many of its internal directives with regulations that govern 
nuclear safety and worker safety and health. These regulations provided 
for increased predictability and stability in the regulatory approach 
and, in many aspects, the regulations that govern DOE laboratories are 
essentially similar to those that apply to other industries with 
similar hazards.
    Nevertheless, I believe that changes are needed to improve 
efficiency and I am committed to making appropriate changes. In making 
changes, however, we must ensure that we do not degrade safety or cause 
adverse impacts to our workers, the public, or the environment.
    I am currently evaluating the options for increasing the efficiency 
of DOE laboratories, reducing the bureaucracy, streamlining oversight, 
and identifying and eliminating or revising those requirements that 
stifle efficiency and innovation but do not substantially enhance 
safety. In evaluating these options, we plan to rely heavily on the 
insights from the previous studies and pilot programs and we will be 
seeking input from the affected parties including the Occupational 
Safety and Health Administration, DOE laboratory directors, and Members 
of Congress. We are concurrently examining other options that will 
improve efficiency of DOE's current regulation approach, including 
options for streamlining oversight and improving DOE directives by 
ensuring that they promote flexibility and efficiency as well as ensure 
safe and compliant operations.

Q3.  The President's New Energy for America Plan includes a goal to 
``Ensure 10 percent of our electricity comes from renewable sources by 
2012, and 25 percent by 2025.'' A part of this energy will come from 
sustainably-harvested renewable biomass. Right now the Office of 
Biomass at DOE focuses almost entirely on biomass as it relates to 
liquid transportation fuels. Are there plans to increase the scope of 
the Office of Biomass to include research in the area of biopower, 
including both thermal and electricity from biomass?

A3. The Department currently includes biopower as part of the 
integrated biorefinery platform as a co-product with the production of 
advanced biofuels and bioproducts, consistent with the FY 2009 
appropriation. The FY 2010 request does not change the scope of the 
Office of Biomass, but the Department is continually reviewing its 
priorities in light of evolving policy priorities, advances in 
research, authorizing legislation, and availability of funds. Biopower 
projects tend to be at a commercial stage, making them potential 
candidates for the Department's Loan Guarantee Program.

Questions submitted by Representative Lynn C. Woolsey

Q1.  There has been a lot of talk about holding off on global climate 
change legislation until the economy recovers, even though I believe 
that if done correctly we can stimulate the economy with this 
legislation. What are your thoughts on the consequences of putting off 
actions to address global climate change, and how soon do you think we 
must act?

A1. Despite the economic downturn, global emissions are expected to 
continue to rise over the next few years and, in the absence of 
significant global action on climate change, throughout the coming 
decades. In order for greenhouse gas (GHG) concentrations to stabilize 
at any level, GHG emissions must not just stabilize, but must decrease. 
The sooner that decrease begins, the lower the corresponding climate 
impacts. Given the potential for `tipping points' and irreversible 
impacts with very negative consequences, it is in our interest to act 
as soon as possible. With that in mind, the Administration is 
leveraging the considerable investment being made through the American 
Recovery and Reinvestment Act of 2009 to lay the groundwork for 
domestic emissions reductions while reinvigorating the economy.

Q2.  Although I know that you must recuse yourself from issues specific 
to Berkeley Lab, I would like to hear your thoughts about the Solar 
Energy Research Center's (SERC) as a model for conducting game-changing 
energy research. Why is this type of program important? What steps are 
you taking to develop and fund this approach more broadly?

A2. The Solar Energy Research Center (SERC) at Lawrence Berkeley 
National Laboratory is a multi-disciplinary and multi-investigator 
center for tackling one of the most challenging issues in energy 
sciences--the production of chemical fuels from sunlight, carbon 
dioxide, and water using artificial systems. This challenge often is 
referred to as developing ``artificial photosynthesis.'' The approach 
recognizes the complexity and magnitude of the research challenge and 
therefore integrates the collective expertise of many scientists to 
accelerate research towards the goal.
    This collaborative approach also forms the basis for the 46 new 
Energy Frontier Research Centers (EFRCs) awarded in FY 2009 and for the 
eight Energy Innovation Hubs proposed in the FY 2010 DOE budget 
request. These two programs differ in scale--funding for the EFRCs 
ranges from $2-5 million annually while funding for the Hubs is $25 
million annually--but the philosophy of assembling teams of researchers 
to tackle problems of great scale and scope is the same.

Questions submitted by Representative Russ Carnahan

Q1.  Secretary Chu, as you know our homes, offices, schools, and other 
buildings consume 40 percent of the primary energy and 70 percent of 
the electricity in the U.S. annually. These buildings also accounts for 
39 percent of U.S. CO2 emissions each year. Clearly, we must 
address these inefficiencies in our built environment. I am encouraged 
by DOE's Building Technologies Program which works to improve the 
efficiencies of buildings and bring us closer to net-zero-energy 
buildings. Where do you see this program heading in the future?

A1. One goal of the program is enabling the cost-effective construction 
of net-zero energy homes by 2020, and net-zero energy commercial 
buildings by 2025. The significant increase for FY 2010 is highlighted 
by the creation of a new Buildings Technologies Energy Innovation Hub 
for Energy Efficiency Building Systems Designs. This Hub will bring 
critical interdisciplinary talent to bear on new breakthrough 
materials, technologies, processes and techniques needed for continued 
progress toward these goals and for future generations of high-
performance, intelligent, green homes and buildings, as well as systems 
building controls.
    Additionally, the program will develop a new strong focus on 
improving the efficiency of the existing building stock through 
targeted whole-building R&D, operation and maintenance, smart-grid 
interface, and smart equipment and appliance research. To make sure 
research advances are adopted and utilized effectively, the program is 
aggressively engaging the market with deployment programs such as the 
Builders Challenge, Home Performance with Energy Star, home labeling 
with the EnergySmart Home Scale (E-Scale), the National Commercial 
Building Alliances, EnergySmart Schools and Hospitals, and model 
building code promotion to ensure research advances are adopted and 
utilized effectively. A very high priority is the promulgation of 
energy conservation standards for consumer products and commercial and 
industrial equipment to assure the American public has available the 
most energy efficient equipment and products that are technically 
feasible and economically justified.

Q2.  Secretary Chu, how effective are current methods for coordinating 
the green building activities across federal agencies?

A2. The Department of Energy (DOE) currently coordinates green 
buildings across federal agencies in three primary ways: greening the 
Federal Government's own buildings, conducting research and development 
on green building technologies, and outreach and education with the 
public at large.
    To effectively green the Federal Government's own buildings and 
lead by example for the whole nation, DOE's Federal Energy Management 
Program chairs the Interagency Sustainability Working Group (ISWG). The 
ISWG includes active members from the major federal agencies and meets 
monthly to coordinate interagency activities on green buildings and 
sustainability. The ISWG helps to facilitate the Federal Government's 
implementation and integration of green building laws, regulations, 
presidential directives, and other federal policies.
    One measure of the Federal Government's progress is the number of 
buildings and square footage certified under the U.S. Green Building 
Council's Leadership in Energy and Environmental Design (LEED) rating 
system. As of December 2008, there were 123 certified Federal LEED 
buildings, totaling about 14 million square feet, and located in 19 
different federal agencies. The number of Federal LEED certified 
projects has increased annually, while federal construction funding has 
remained relatively stable. Moreover, Federal LEED buildings represent 
more than five percent of all LEED certified buildings, whereas federal 
buildings total about 1.5 percent of all buildings in the U.S. All of 
this indicates that the Federal Government is leading the way by 
investing in its buildings in a smarter, more environmentally friendly 
manner. In recognition of its accomplishments, the ISWG received a 2007 
White House Closing the Circle Award for Leadership in Environmental 
Stewardship.
    To coordinate interagency green building R&D activities, DOE co-
chairs the Subcommittee on Buildings Technology Research and 
Development with the National Institute of Standards and Technology. 
The National Science and Technology Council Committee on Technology 
established this subcommittee to provide R&D guidance; serve as a forum 
for collection, analysis and dissemination of federally funded research 
results; and interact with federal agencies that own, lease, construct 
or provide financial assistance to facilities.
    In addition, DOE and the General Services Administration (GSA) have 
begun to carry out the requirements of the Energy Independence and 
Security Act of 2007 (EISA 2007) (Pub. L. 110-140). For example, EISA 
established the Office of Commercial High-Performance Green buildings 
in DOE and the Office of Federal High-Performance Green Buildings in 
GSA. DOE and GSA are establishing a high-performance green building 
clearinghouse which is expected to be operational by the end of 2009. 
Both offices work in concert with the Interagency Sustainability 
Working Group.

Q3.  To what extent and by what means should Congress extend federal 
efforts to facilitate and support adoption and implementation of green 
building measures throughout the United States?

A3. The green building movement has grown over the past 20 years, and 
there are numerous voluntary rating and certification systems, 
including the United States Green Building Council's Leadership in 
Energy and Environmental Design, Green Globes, National Home Builders 
Association Green Program, DOE-EPA Energy Star Homes and Commercial 
Buildings, among others.
    In order to facilitate a broader acceptance and implementation of 
green building practices and products, several actions may be needed. 
These actions include establishing a definition of what constitutes a 
green home or building based on standardized testing and measurement 
protocols, standardized labeling of building performance based on 
common measurement protocols, requirements for disclosure of actual 
performance to prospective owners or occupants, and reform of building 
appraisal and financing to capture the value-added of measured high-
performance in real estate transactions. The effectiveness, reliability 
and durability of green building materials, practices and products need 
to be fully demonstrated prior to incorporation of green building 
provisions into building codes and standards. The Federal Government's 
current role in these regulatory areas could assist in such 
demonstration.

Question submitted by Representative Charles A. Wilson

Q1.  One conversion option for a coal facility is burning biomass. In 
many cases, it is more cost-effective to co-fire the facility, using 
both coal and biomass, instead of replacing the equipment necessary to 
fully convert the plant to biomass. Currently, production tax credits 
only apply to plants burning 100 percent biomass. Would you support 
some kind of incentive to promote the co-firing option?

A1. The Department supports incentives that seek to promote the use of 
renewable sources of energy including biomass. The renewable production 
tax credit (PTC) applies to any level of biomass co-fired with coal. 
The power plants do not have to burn 100 percent biomass in order to 
qualify for the PTC. According to the expanded definition of ``open-
loop biomass'' promulgated by the IRS, many forms of biomass co-fired 
with coal qualify for the PTC. In addition, H.R. 2454, the proposed 
``American Clean Energy and Security Act of 2009,'' would permit 
biomass with coal to be a qualified renewable electricity source (with 
the portion that is biomass counting as renewable) for the Combined 
Efficiency and Renewable Electricity Standard. The Department supports 
the continuing incentive provided by the PTC to encourage the use of 
renewable energy technologies such as biomass.

Questions submitted by Representative Ben R. Lujan

Q1.  In New Mexico, we are aptly positioned to support solar energy 
development. How will the Recovery Act's funding for renewable energy 
R&D help the development of both distributed generation and utility-
scale solar energy technologies, and help solve many of the storage and 
transmission issues we are currently facing?

A1. Recovery Act funding for renewable energy R&D will be used to fund 
multiple efforts that directly support the development of both 
distributed generation and utility-scale solar energy technologies, as 
well as storage and transmission technologies. Specific efforts 
include:

          $51.5 million to expand investment in advanced 
        photovoltaic concepts and high impact technologies;

          $40.5 million to overcome barriers to solar energy 
        deployment, including grid integration issues, obstacles to 
        solar energy adoption in cities, and a shortage of trained 
        solar energy installers;

          $25.6 million to support utility-scale concentrating 
        solar power, including $18 million for the National Solar 
        Thermal Test Facility at Sandia National Laboratory to better 
        support industry technology development and system testing 
        needs.

    Recovery Act efforts on storage and transmission issues also 
include:

          Competitive opportunities to facilitate high 
        penetration of PV in a distribution system, enable widespread 
        deployment of small modular PV systems, and demonstrate 
        integration of PV and energy storage into Smart Grid 
        applications;

          Support Solar Energy Grid Integration Systems 
        development through private sector partnerships with Sandia 
        National Laboratory.

Q2.  As a former Public Regulation Commissioner, I heard concerns from 
my constituents about renewable energy transmission. Regarding 
transmission lines, can you discuss what research is being done to 
develop high capacity conveyance materials?

A2. The Department's FY 2010 budget request includes $22 million to 
support research efforts in Advanced Cables and Conductors under the 
Office of Electricity Delivery and Energy Reliability. This program 
area recognizes, in particular, the role that High Temperature 
Superconducting (HTS) wire can play in meeting the need for greater 
power transfer capabilities, increased capacity, and greater 
flexibility. In FY 2010, efforts will focus on mitigating the 
alternating current or AC losses generated in existing second 
generation (2G) HTS wire architectures; this is a critical step in 
developing high capacity materials suitable for transmission cable 
applications.

Q3.  What kind of new technologies are being developed in geothermal 
energy to accommodate both lower temperature waters (closer to surface) 
and ``hot rock'' (deep under surface)? Can you elaborate on any 
resource assessment initiatives, for example, examining the use of 
abandoned oil and gas bore holes to access heat?

A3. The Geothermal Technologies Program (GTP) at the Department of 
Energy is currently seeking research and development projects through a 
competitive solicitation with the goal of developing new technologies 
to enable the United States to better access low-temperature resources. 
DOE will use up to $50 million in Recovery Act funding to award up to 
ten cooperative agreements in support of geothermal energy production 
from oil and gas fields, geopressured fields, and low-temperature 
resources throughout the United States.
    Widespread but underutilized low-temperature geothermal resources 
(below 300 degrees Fahrenheit) present an immediate opportunity to 
economically increase the Nation's supply of clean, renewable 
geothermal energy. Geopressured fields are over-pressured reservoirs 
that contain thermal energy in hot water, kinetic energy from pressure, 
as well as natural gas. In co-produced fluid systems, oil and gas wells 
produce hot water along with hydrocarbons. The GTP expects to 
demonstrate as much as 20 megawatts-electric from these projects 
throughout the United States. Success in these projects, will, over 
several decades, enable continually increased amounts of geothermal 
electricity generation.
    To address further resource assessment needs, the GTP will renew an 
existing interagency agreement with the United States Geological Survey 
(USGS) using Recovery Act funds. USGS concluded a geothermal resource 
assessment of the western United States in late 2008 that estimated the 
presence of 30,033 MWe of undiscovered but accessible conventional 
geothermal potential. The renewed agreement will allow the USGS to 
extend the geothermal resource assessment nationwide and to include the 
complete range of geothermal resources including low temperature, 
significant depths (greater than six km), as well as geopressured and 
co-produced fluids from oil and gas wells.

Q4.  Congress has entrusted the Department of Energy with a very large 
amount of taxpayer dollars for Research and Development. I am very 
concerned that this money be spent quickly to stimulate the economy. In 
doing so, what do you envision the funding split will be between the 
Office of Science laboratories and the NNSA laboratories?

A4. The $1.6 billion appropriated for Office of Science is not yet 
fully allocated, but our current estimate is that about $1.1 billion 
will go to DOE national laboratories. Of that $1.1 billion, about $7 
million is currently allotted to the Los Alamos, Lawrence Livermore, 
and Sandia National Laboratories. However, there is still unallocated 
funding that may increase the allocation to NNSA laboratories. For 
instance, $277 million of Recovery Act funding is planned for Energy 
Frontier Research Centers; Los Alamos and Sandia may receive sub-awards 
on some of these university-led awards, but the specific amounts have 
not yet been finalized.

Q5.  I am aware that the NNSA laboratories have significant expertise 
in the areas of global climate change. How do you plan to utilize 
expertise in this and other non-weapons fields at the NNSA labs?

A5. NNSA laboratories have a rather unique expertise in large-scale 
integrated simulations that is readily applicable to problems of 
national interest. Historically, the NNSA labs, Los Alamos and Lawrence 
Livermore in particular, have played important roles in the 
understanding of climate. For example, over the last few years Los 
Alamos scientists have completely re-thought the way that computers 
model the flow of sea ice, which has led to new predictions about 
global climate change. Lawrence Livermore scientists played a major 
role in a recently-released report on computer climate models and their 
ability to simulate current climate change, and the laboratory is a 
global repository of data and tools. As key national assets, I intend 
to use the NNSA labs as an important part of meeting my priorities.

Q6.  With Los Alamos and Sandia in my state, could you explain to me 
some of the types of science work you would envision being accomplished 
with funding from the stimulus at each of these facilities?

A6. The Office of Science has several Recovery Act projects that will 
support activities at Los Alamos and Sandia National Laboratories. The 
Nuclear Physics program plans to send funding to Los Alamos for 
enhanced isotope production efforts at the Isotope Production Facility 
at the Los Alamos Neutron Science Center (LANSCE) and investments in 
isotope production and processing capabilities. In addition, Los Alamos 
is collaborating with Brookhaven National Laboratory on the PHENIX 
Forward Vertex detector project for the Relativistic Heavy Ion Collider 
and will receive Recovery Act funding as part of this effort. The Basic 
Energy Sciences program plans to provide Sandia and Los Alamos National 
Laboratories funding from the Recovery Act to support the Center for 
Integrated Nanotechnologies Facility to expand its capabilities in the 
High-Performance Computer Cluster, Imaging Microscopes, and X-ray 
Diffraction instruments.
    In addition, the Nuclear Physics program is currently evaluating 
proposals received in response to two Funding Opportunity Announcements 
that were issued using Recovery Act funding: Applications of Nuclear 
Science and Technology and R&D on Alternative Isotope Production 
Techniques. These competitive solicitations are aimed at universities, 
industry, and national laboratories; and Los Alamos and Sandia were 
both eligible to apply under these announcements. Also, the Fusion 
Energy Sciences program is evaluating proposals received in response to 
a request to all current participants in the Innovative Confinement 
Concepts (ICC) program. Los Alamos is a participant in the ICC program 
and was eligible to apply.

Questions submitted by Representative Gary C. Peters

Q1.  There has been a growing recognition that one tool for meeting our 
climate and energy goals will include electrification of our 
transportation sector, and the Recovery Act along with the energy bill 
of 2007 provided very aggressive authorizations and funding to support 
this nascent technology industry. It is clear that batteries are at the 
forefront of this industry, and a lot of investment has been made in 
the area of passenger vehicle battery technologies. What is being done 
to support the development of advanced technologies for commercial 
trucks and heavy duty vehicles?

A1. The Department is leading a government/industry partnership that 
supports the development of advanced technologies for commercial trucks 
and heavy duty vehicles. The overall goal of the 21st Century Truck 
Partnership is to accelerate the introduction of advanced truck and bus 
technologies that use less fuel, have greater fuel diversity, meet 
future emissions standards and are cost-effective. The Department's FY 
2010 Budget request doubles the funding for commercial vehicle R&D to 
approximately $50 million. Also, the Department has allocated 
approximately $75 million of American Recovery and Reinvestment Act 
(Recovery Act) funding to promote advanced technologies for commercial 
vehicles. The Department will utilize these Recovery Act funds along 
with appropriated funds to release a competitive solicitation that will 
request commercial vehicle manufacturers and supplier teams to develop 
systems-level solutions for increasing the overall freight-moving 
efficiency by 50 percent (based on total fuel consumption) for the 
standard Class 8 heavy truck/trailer combination. Additional fossil 
fuel displacement may be realized in some technology configurations 
through the use of renewable, non-petroleum-based fuels. Technology 
areas to be supported with these funds include: high efficiency engine 
systems; alternative fuels; heavy-duty hybrid systems; and reduction of 
aerodynamic drag, tire rolling resistance, vehicle weight and engine 
idling.

Q2.  Foreign governments (such as China, Japan, and Korea) are making 
significant investments in battery and vehicle technologies. Are U.S. 
federal efforts comparable to what these foreign governments are doing? 
Do we risk losing global competitiveness in this field if we fail to do 
more?

A2. The figures for the amount of foreign investment in battery and 
vehicle technologies are not always available and foreign investments 
often are not readily quantifiable. However, in general DOE believes 
that the U.S. is investing in battery and vehicle R&D in amounts that 
are comparable to foreign countries such as China, Japan and Korea. The 
U.S. has an excellent track record in developing these new 
technologies, but has not always succeeded in commercializing the 
technologies as they develop.
    Approximately $2 billion in Recovery Act funds will help establish 
approximately $4 billion (with participant cost-share) in new 
manufacturing capability to produce advanced batteries and electric 
drive components required to commercialize advanced vehicles such as 
plug-in hybrids. These funds will significantly defray the 
capitalization costs of these new facilities, helping U.S. 
manufacturers compete against established global businesses. This 
solicitation closed on May 19th and up to 40 awards are expected to be 
announced later this summer. The Department believes this investment, 
along with ongoing technology R&D, will ensure U.S. competitiveness in 
advanced battery and vehicle technologies.

Q3.  I understand there has been a great deal of interest in the 
Department's ``Section 136'' Advanced Technology Vehicles Manufacturing 
Loan Program. With credit markets frozen, federal loans are virtually 
the only means through which auto companies can secure the financing to 
continue development of this technology. Are the Department's current 
resources adequate to meet the demand for this program?

A3. Since its establishment in October following the passage of the 
Continuing Appropriations Act of 2009, the Department has hired federal 
staff to manage and execute the Advanced Technology Vehicles 
Manufacturing Loan Program; contracted for outside financial advisors, 
market advisors and law firms to review applications; and conducted 
technical evaluations of applications, which now number over 100. An 
additional appropriation was obtained in 2009 to cover contract 
expenses. A substantial number of these applications have now been 
reviewed and applicants notified of their eligibility to proceed to the 
next step of the process. We have negotiated with those farthest along 
and expect to be in position to announce conditional commitments 
shortly. In every case we are moving with all deliberate speed while 
assuring that appropriate measures are undertaken to protect taxpayers' 
interests.

Q4.  I have been following the FRIB competition closely. I am very 
supportive of the overall budget for the Office of Science, and I 
understand the importance of maintaining a balanced portfolio. In that 
light, can you tell me what funding level the FRIB project will need 
for FY 2010?

A4. The FY 2010 budget includes a request for $9,000,000 to continue 
R&D, National Environmental Policy Act (NEPA) review, and conceptual 
design activities aimed at developing the Facility for Rare Isotope 
Beams (FRIB).

Questions submitted by Representative Ralph M. Hall

General

Q1.  How do you plan to handle technology transfer on the domestic and 
international fronts? For example, will the Department of Energy, as 
authorized in Section 1611 of the Energy Policy Act of 2005, continue 
to work with developing countries to deploy greenhouse gas intensity 
reducing technologies, and, if so, under what programs? As an example, 
do you see the Asia Pacific Partnership playing a continued role in the 
transfer and demonstration off CCS technologies to China and India?

A1. DOE supports domestic and international technology transfer. 
Domestically, the national laboratories and facilities conduct 
technology transfer programs. The DOE Technology Transfer Policy Board 
continues to examine how technology transfer is done across the DOE 
Complex to determine ways in which the process can be done more 
effectively. Internationally, DOE continues its work with developing 
countries to deploy technologies that will reduce greenhouse gas 
intensities. Examples of this work are the Asia Pacific Partnership and 
bilateral programs with developing countries that have significant GHG 
emissions. The Administration has proposed a significant increase in 
the development assistance programs to deploy clean energy technology 
to developing countries in the 2010 Budget. These funds would be 
managed by the Departments of State and Treasury.

Q2.  Does the Department have an inventory of developed or developing 
greenhouse gas intensity reducing technologies that are suitable for 
transfer, deployment, and commercialization in developing countries? If 
so, how often is it updated?

A2. In January 2009 the report, Strategies for the Commercialization 
and Deployment of Greenhouse Gas Intensity-Reducing Technologies and 
Practices, was submitted to the President and Congress in fulfillment 
of the requirements of the 2005 amendments to Sections 1610(c)(1), 
1610(e), 1610(g)(1) and 1610(g)(4)(A) of the Energy Policy Act of 1992. 
Annex A of the report, Inventory of Greenhouse Gas-reducing 
Technologies, identifies over 400 GHG-reducing technologies.\1\ Some of 
these technologies are available commercially or can be deployed in the 
near-term.
---------------------------------------------------------------------------
    \1\ Available online at http://www.climatetechnology.gov/Strategy-
Intensity-Reducing-Technologies.pdf
---------------------------------------------------------------------------
    Numerous technologies that can reduce GHG emissions already exist, 
but within a wide spectrum of technical readiness. Many are mature 
enough now to be used commercially, such as compact fluorescent light 
bulbs and hybrid vehicles. Others are in earlier stages of development, 
such as production of hydrogen from photobiological processes or 
Generation IV nuclear plants. For the purpose of the report, 
``suitability for commercialization and deployment'' was interpreted as 
a level of technical maturity such that the technology can be readied 
for commercial use now or imminently through product development (e.g., 
size, operational standards, production engineering, etc.), even if the 
technology faces economic, regulatory, or policy challenges that could 
inhibit its wider deployment.
    The technologies identified in the Inventory of Greenhouse Gas-
Reducing Technologies are all considered potentially suitable for 
transfer, deployment, and commercialization in developing countries. 
Transfer, deployment, and commercialization of such technologies depend 
in part on countries having the infrastructure and enabling 
environment, including IPR protections, to take full advantage of such 
technologies. The report was issued in January 2009 and therefore the 
inventory is current. It will be updated on an as needed basis.

Q3.  Senator Bingaman recently released a draft energy bill that 
included a Grand Challenges Research Initiative that would establish a 
Grand Challenges in Energy Research Initiative for the purposes of 
integrating basic and applied sciences to solve the Grand Challenges of 
Energy. Do you support this initiative? How would it fit into the 
current structure at DOE and also with what ARPA-E is intended to do? 
In other words, how is it similar to and different from what is 
currently being done at DOE and would be done at ARPA-E?

A3. I fully support the intended goals of the Grand Challenges Research 
Initiative outlined in the Senate Energy Committee bill, which is why I 
have proposed the Energy Innovation Hubs in the FY 2010 budget request. 
The Hubs will compliment the new Energy Frontier Research Centers 
(EFRCs) and ARPA-E--each has a distinctly different and important role 
in our energy R&D portfolio to maximize our chances of achieving 
breakthrough energy solutions.
    Let me briefly explain the differences. EFRCs are small-scale 
collaborations among researchers around the country, primarily at 
universities and other institutions. They focus on accelerating the 
fundamental scientific discoveries that will be the foundation for the 
transformational energy technologies of the future, and they are funded 
at $2 to $5 million per year.
    ARPA-E is a highly entrepreneurial-focused program that swings for 
home runs, developing potentially breakthrough technologies that are 
too risky for industry to fund. ARPA-E will implement DARPA's approach 
to mission-oriented R&D by funding scientists and technologists 
(sometimes by forging and nurturing partnerships of its own design) to 
accelerate an immature energy technology with exceptional potential 
beyond the risk barriers that prevent its translation from the bench to 
the marketplace. It will seek out the best ideas and move quickly to 
help bring the idea to enough maturity that industry can take over 
development, bringing the technology to market. ARPA-E will look for 
the best opportunities to meet its mission areas of improving energy 
security and curbing climate change by making programmatic investments 
lasting two to five years. ARPA-E will then move on to the next big 
idea, shifting into and out of areas depending on the opportunities for 
transformational change.
    The Energy Innovation Hubs, modeled on the Department's successful 
Bioenergy Research Centers, will focus significant resources on our 
most critical energy technology challenges. Each Hub will comprise a 
highly collaborative team spanning many disciplines, ideally working 
under one roof. By bringing together top talent across the full 
spectrum of R&D performers--including universities, private industry, 
non-profits, and national laboratories--each Hub is expected to become 
a world-leading R&D center in its topical area. The Hubs will support 
cross-disciplinary R&D focused on the barriers to transforming its 
energy technologies into commercially deployable materials, devices, 
and systems. The budget proposal is for each Hub to be funded at $25 
million per year for a five-year term, with additional start-up funding 
of $10 million in the first year for renovation (but not ``bricks and 
mortar''), equipment, and instrumentation.

Q4.  Does your Agency have any studies to help us understand what 
`energy security' or `energy independence' actually mean? People toss 
those terms around all the time very loosely, but it's not clear to me 
what exactly is meant, or how one measures our progress towards that 
goal, or if that goal can or should be reached anytime in the next 
twenty years. Do we have good metrics to help us understand if we are 
making progress, or if some technologies might help us make progress 
faster?

A4. The concepts of ``energy security'' and ``energy independence'' 
have many dimensions, especially with regard to U.S. policies and 
practices both globally and domestically. In terms of the U.S. 
dependence on imported energy, energy security policy is designed to 
prevent disruption in energy imports, address the impact if such 
disruptions occur, and mitigate the length and severity of any 
disruptions to prevent serious harm to the U.S. economy and national 
security. In order to reduce the potential for energy import 
disruptions, the United States encourages global energy supply 
diversity; operates an open and competitive market, consistent with our 
international trade obligations, to encourage importers to sell to 
customers in the United States; fully integrates diverse imports into 
the U.S. energy economy; limits political intervention in energy 
markets; and provides global leadership to promote transparent and 
competitive international oil and natural gas trading and investment 
opportunities.
    More broadly in relation to the domestic economy, energy security 
requires domestic policy decisions and market practices to encourage 
and permit further development of an economically viable, competitive, 
largely renewable and environmentally sustainable energy economy, 
recognizing the U.S. economy's full integration in the global market. 
This requires accelerating the development and deployment of 
alternative energy technologies and effectively addressing related 
climate change and environmental impacts--which should also help reduce 
our dependence on foreign energy sources. Over time, these steps should 
also help reduce financial outflows for conventional resources and 
contribute to mitigating the effects of global warming while building a 
new competitive, efficient, clean market-based energy economy. Indeed, 
promoting technological innovation is crucial to expanding the role of 
renewable energy sources in motor vehicle fuels; developing and 
deploying a more efficient electric power sector, improving energy 
efficiency throughout the economy, and developing expanded public 
transit and rail services.
    Overall, a generation-long move toward greater efficiency in energy 
use and the use of domestic renewable energy can help to reduce our oil 
demand, address climate concerns, and further strengthen national 
energy security. The Energy Information Administration (EIA) provides 
more information on oil, natural gas, and electricity disruptions and 
vulnerabilities as well as other events that affect global energy 
security.

Q5.  Does it concern the Department of Energy that a policy of placing 
duties or tariffs on imported goods manufactured in countries that 
refuse to set a price on carbon may result in trade related barriers 
maintained by foreign countries on the export of greenhouse gas 
intensity reducing technologies? In Title XVI of the Energy Policy Act 
of 2005, Congress authorized the United Sates Trade Representative to 
identify such trade barriers and negotiate with foreign countries for 
the removal of such barriers.

A5. A recent World Bank study found that removing tariffs and non-
tariff barriers for four clean energy technologies in 18 high GHG-
emitting developing countries could result in trade gains of 13 
percent. Clean energy technology is a growth market offering 
substantial export opportunities for the United States.
    At the same time, however, we acknowledge the concerns of certain 
U.S. manufacturers, particularly in those sectors that are energy- and 
trade-intensive, that the compliance burden of reducing greenhouse gas 
emissions could lead to ``emission leakage'' to countries that do not 
also require such reductions. Any shifting of production to other 
countries could lead to the unintended effect of reducing the 
effectiveness of our domestic efforts to reduce greenhouse gas 
emissions. Climate change is a global environmental challenge and, 
while remaining consistent with our existing international obligations, 
the Administration wants to ensure that the U.S. response is not 
weakened by the failure of other countries to take action.
    The Administration believes that the best approach to address 
concerns with emission leakage is to negotiate a new international 
climate change agreement that ensures that all the major emitters take 
long-term, significant actions to reduce their greenhouse gas 
emissions. The Waxman-Markey bill acknowledges this as the first-best 
approach as well.
    In short, engaging major GHG emitting countries, and major trading 
partners, to ensure that they commit to significant and verifiable 
actions to combat climate change would be the most effective way to 
ensure a level playing field for U.S. manufacturing sectors.

Oil & Gas

Q6.  The President's budget blueprint talks about funding for low-
carbon coal technologies, but does not mention any support for oil and 
gas R&D. In fact, the budget proposes to repeal the Ultra Deepwater 
Program that was enacted into law in the Energy Policy Act of 2005. 
Will you please tell us what plans DOE has to continue fossil fuel R&D 
for not only coal but also oil and gas?

A6. The oil and gas R&D program plans to focus its research on methane 
hydrate, a potentially huge, future gas resource and possible carbon 
storage opportunity. Methane hydrate occurs where natural gas and water 
exist at cool temperatures and high pressures--in the Arctic, below the 
permafrost and in deep sub-sea sediments. The world methane hydrate 
resource is estimated to be larger than the conventional natural gas 
resource, for example, the Alaska North Slope has an estimated 85 
trillion cubic feet (TCF) of undiscovered, technically recoverable gas 
in methane hydrates compared to 37.5 TCF in conventional deposits.
    The DOE program aims to have the technology needed for methane 
production from arctic hydrate by 2015 and from offshore hydrate by 
2025. The program plans to conduct the world's first long-term 
production test of methane hydrate deposits in the Alaska North Slope 
in 2010-2011. The program will also be conducting the first test of 
CO2 injection into a methane hydrate reservoir to produce 
natural gas and store carbon in Alaska in 2010-2011.

Q7.  In the Recovery Act, $400 million was set aside for geothermal 
energy R&D. In the Energy Independence and Security Act (EISA) of 2007, 
the geothermal provision included a section on geothermal energy 
production from oil and gas fields and recovery and production of 
geopressured gas resources--Section 616. Does DOE plan to implement 
this section which was authorized at $10 million a year?

A7. Yes. Through the Recovery Act funding, the Department's Geothermal 
Technologies Program is implementing Section 616 of the Energy 
Independence and Security Act. Geothermal energy resource development 
from oil and gas operations is an untapped opportunity which would use 
high temperature water currently treated as a waste. The Department's 
goal is to demonstrate the technical and economic feasibility of 
geothermal energy production from these non-conventional geothermal 
resources.
    Through a funding opportunity announcement issued recently, DOE 
will award up to 20 grants or cooperative agreements for up to $50 
million in support of geothermal energy production from oil and gas 
fields, geopressured fields, and low temperature resources throughout 
the United States.

Coal

Q8.  You said in your testimony that you would like to expand 
international collaboration on demonstrating carbon capture and 
sequestration. Will you tell us more about this and your plans for 
FutureGen? Do you foresee willing international cooperation in light of 
how our international partners were treated after the restructuring of 
FutureGen?

A8. After several meetings between DOE officials and representatives 
from the FutureGen Industrial Alliance, Inc. (Alliance), an agreement 
has been made to once again pursue the FutureGen project in Mattoon, 
Illinois. Under the terns of the provisional agreement between DOE and 
the Alliance, DOE will issue a National Environmental Polity Act (NEPA) 
Record of Decision on the project by the middle of July 2009, with the 
following activities to be pursued from the end of July 2009 through 
early 2010: Rapid restart of preliminary design activities; Completion 
of a site-specific preliminary design and updated cost estimate; 
Expansion of the Alliance sponsorship group; Development of a complete 
funding plan, and; Potential additional sub-surface characterization. 
The Department's maximum anticipated financial contribution for the 
project is $1.073 billion, $1 billion of which comes from Recovery Act 
funds for Carbon Capture and Storage (CCS) research. FutureGen is 
expected to have a strong international element and would include 
outreach to all interested countries, including those who were 
previously engaged with FutureGen.

Nuclear

Q9.  In light of the Administration's decision to move beyond a 
repository at Yucca Mountain, where does that leave DOE in regards to 
reprocessing and the next generation of nuclear plants?

A9. The Department is pursuing long-term, science-based nuclear R&D 
through its Generation IV Nuclear Energy Systems and the Fuel Cycle R&D 
programs. Gen IV R&D will focus on answering key research questions 
that could help establish the viability of next-generation nuclear 
energy technologies or could be useful in extending the operating life 
of existing light water reactors (LWRs). Fuel Cycle R&D will focus on 
wide variety of fuel and waste-related topics, such as research on 
separations technologies and systems and on waste forms with 
predictable, long-term behavior and enhanced resistance to long-term 
degradation suitable for a variety of potential environments. These 
efforts could enable beneficial changes to the way in which nuclear 
fuel and waste is managed.

Q10.  Do you believe that nuclear energy is an important part of our 
current and future energy mix? Will the plan to scrap Yucca affect in 
any way the ability for companies today to go forward with building new 
plants?

A10. Nuclear power currently supplies nearly 20 percent of the Nation's 
electricity and approximately 70 percent of its greenhouse gas-free 
electricity. Nuclear power will continue to play a role in our energy 
mix. It can help achieve our energy security and climate goals, and the 
Department is committed to supporting such use in a safe and secure 
manner that minimizes proliferation concerns.
    The Department believes reevaluating options for spent fuel should 
not affect the ability of companies to go forward with plans for new 
nuclear power plants. The Secretary has announced his intent to convene 
a blue-ribbon commission to evaluate all spent fuel options and 
consider long-term solutions.

Biofuels

Q11.  Recently an application was submitted to EPA requesting approval 
for the use of up to 15 percent ethanol in gasoline which was justified 
in part on the basis that this increase would lead to ``increased 
energy security.'' Has DOE performed or sponsored (or are you aware of) 
any studies which support the contention that raising the maximum 
allowable amount of ethanol in gasoline from 10 percent to 15 percent 
will lead to ``increased energy security''?

A11. DOE has not performed any specific studies that investigate the 
impact of specific blend levels on increased energy security.
    The renewable fuel standard (RFS), established by Section 202 of 
the Energy Independence and Security Act of 2007 was enacted in part to 
improve energy security. The RFS calls for increasing the volume of 
renewable fuels to 36 billion gallons by 2022. In 2008, about nine 
billion gallons of ethanol were produced and consumed. The majority of 
ethanol is consumed in the E10 market and a small amount is absorbed as 
E85. If ethanol continues to be the dominant renewable fuel in the 
market, deployed via blends of 10 percent ethanol in gasoline, the U.S. 
will not be able to use the amount specified in RFS targets (15.2 
billion gallons per year) by 2012 unless significant additional volumes 
of ethanol are sold as E85.

Q12.  DOE is currently co-sponsoring a significant amount of research 
aimed at investigating vehicle emissions--energy and emissions control 
system durability characteristics while operating on gasoline 
containing greater than 10 percent ethanol. This research is expected 
to take at least two to three years to complete. Is DOE planning to 
change or refocus their research on mid-level ethanol blends in any way 
in light of a petition recently submitted requesting approval for the 
use of up to 15 percent ethanol in gasoline? If so, how?

A12. In 2007, the Department of Energy (DOE) began evaluating the 
potential impacts of E15 and E20 on emissions, durability, operability, 
drivability, and materials when used in conventional vehicles and non-
road engines. Throughout the process, DOE has worked closely with the 
Environmental Protection Agency (EPA) to ensure that data from DOE's 
test program can assist EPA in effectively evaluating waiver requests.
    Last October, DOE reported results from a ``quick look study'' 
which included emissions testing on 16 vehicles as well as 28 small 
non-road engines. Regulated tailpipe emissions for the 16 vehicles 
either decreased or showed no statistically significant change with 
increased ethanol content relative to gasoline.
    Since completion of these initial tests, DOE has been engaged in a 
wide range of additional vehicle testing. Recognizing the need to 
expedite testing, particularly regarding emissions over the full-useful 
life of vehicles, DOE has significantly increased funding for this 
effort and is now simultaneously using three facilities rather than 
just one to conduct testing. As a result, a substantial amount of data 
on full-useful life emissions will be available in approximately one 
year, coinciding with the completion of several other studies. These 
studies will provide significant information to assist EPA in (1) 
making a determination as to whether E15 or E20 can be viably used in 
conventional vehicles and (2) setting renewable fuel volume levels for 
2011 in light of its determination on E15 or E20.

Q13.  To what extent will the EPA's impending proposal on the treatment 
of the greenhouse gas impacts associated with indirect land-use changes 
caused by the increased use of some biofuels (e.g., corn-based ethanol) 
cause DOE to shift research priorities in its biomass R&D program?

A13. Research priorities for DOE's Biomass Program will not shift as a 
result of EPA's proposed treatment of greenhouse gas impacts associated 
with indirect land-use changes. Current R&D work with Purdue University 
is focused on better understanding and developing DOE's ability to 
analytically assess indirect land use change impacts on biofuels using 
the Global Trade and Agriculture Project (GTAP) model. The data 
utilized in existing models such as GTAP represent the best available, 
but need to be continually and significantly improved as we develop new 
models in the future.
    The Department's Biomass Program will continue to focus on the 
development and sustainability of cellulosic and advanced biofuels, 
which show very positive greenhouse gas benefits with or without 
assessing an indirect land use ``penalty.''

Q14.  A number of research efforts are looking at ways to convert plant 
sugars directly into ``green gasoline,'' avoiding the fermentation 
process used to produce ethanol in today's biorefineries. With respect 
to distillates, interest is growing in so-called ``renewable diesel'' 
which is chemically similar to petroleum-based diesel, yet produced by 
a process that relies on animal- or vegetable-based feedstocks. Green 
gasoline and renewable diesel have been shown to be superior to ethanol 
and biodiesel in that they can be transported and stored using the same 
infrastructure currently devoted to petroleum products. To what extent 
is DOE R&D focused on improving the cost-effectiveness of green 
gasoline and renewable diesel?

A14. DOE is conducting R&D on green gasoline and renewable diesel as 
part of the Office of Biomass's existing thermochemical platform. The 
current portfolio contains research into pyrolysis and fuel synthesis 
from pyrolysis oil as well as synthesis gas clean up for use as an 
intermediate to fuels. In addition, Recovery Act funding will be used 
to establish a research consortium specifically targeting the research 
to overcome barriers to cost effective production of biomass derived 
hydrocarbon fuels.
    The Office of Biomass Program's Integrated Biorefinery Platform is 
currently funding two projects to demonstrate the conversion of biomass 
to Fischer Tropsch (FT) liquids at existing pulp and paper mills. These 
FT liquids will be further processed into renewable diesel. Also, a 
pilot and demonstration scale solicitation funded by the Recovery Act 
will accept applications producing green gasoline and renewable diesel.

Q15.  We've heard claims about cellulosic ethanol being ``right around 
the comer'' for over 20 years now. It's my understanding that industry 
is not going to meet the RFS2 mandate of 100 million gallons in 2010, 
nor future mandates in the next several years. How long does it take 
between the introduction of a new technology at commercial scale before 
it can be rapidly scaled up? For example, what does DOE think are 
reasonable targets for the RFS2 cellulosic mandates, accepting that the 
current mandates are far too optimistic?

A15. It can take up to ten years from the introduction of a new 
technology to be scaled up to commercial scale. This time frame can be 
even more difficult to ascertain given the challenging economic climate 
and extreme variations in energy prices.
    Currently, the Biomass Program has a total of 12 biorefinery 
projects in development. The four commercial projects authorized under 
section 932(d) of the Energy Policy Act (EPAct) of 2005 are expected to 
deliver the first commercial scale production of cellulosic biofuels. 
Of the four projects, two have initiated construction; a third is 
expected to enter into a Technology Investment Agreement and start the 
construction phase of the project early in FY 2010. The fourth project 
will likely reach a phase two agreement and initiate the construction 
phase later in FY 2010. The construction phase of the last two projects 
will be funded by the Recovery Act. The eight remaining projects are in 
various phases of development.
    They are all demonstration projects with construction anticipated 
in the 2011-2012 timeframe.
    Collectively, these 12 projects represent over 100 million gallons 
of biofuel production annually; however, they have all experienced 
delays due to deteriorating market conditions. Based on current 
schedules, none of the projects will be producing commercial volumes in 
2010. However, we expect the first facilities to come on line in the 
2011-2012 time frame.
    Consequently, the Department believes that meeting the 2010 target 
for cellulosic biofuels set by the RFS2 will be extremely challenging. 
However, the RFS2 does provide the Environmental Protection Agency 
(EPA) authority to adjust the cellulosic targets. Although the initial 
targets may need adjustments, it is anticipated that once the existing 
projects and those represented in the Recovery Act Biorefinery Funding 
Opportunity start production, the out-year RFS2 cellulosic biofuel 
goals can be met.

Q16a.  In 2007 language in the RFS2 attempted to provide technology 
neutrality so that all feedstocks and technologies had an opportunity 
to develop. I congratulate the Department on their recent modification 
which allows technologies such as Amyris LS9 Gevo and others to utilize 
currently available feedstocks such as sugarcane, sugars, and sorghums 
to demonstrate their technologies. We all support the development of 
cellulosic technologies but it would be wrong to require these other 
advanced technologies to wait for feedstocks to be produced from only 
cellulosic material at this point in time do you agree?

A16a. The Department does agree that certain advanced technologies will 
need to use more readily available feedstocks to foster the development 
of their technology. This research is supported by the Biomass 
Program's recent Integrated Biorefinery Pilot and Demonstration Funding 
Opportunity funded by the Recovery Act. This solicitation has six 
different topic areas which allow for cellulosic biomass, algae, or any 
renewable biomass (other than corn starch) to compete for the 
production of fuels and bioproducts on either a pilot or demonstration 
scale.

Q16b.  Additionally your new modification requires an 80 percent life 
cycle reduction. The provision in the RFS for advanced biofuels is only 
50 percent. Why the difference? Why not harmonize with the EPA rule for 
the long-term?

A16b. The reason for the difference is that advanced biofuels explored 
under Section 207 of the Energy Independence and Security Act (EISA) 
require a higher greenhouse gas reduction requirement of 80 percent 
versus 50 percent. Ultimately, it is not only the harmonization of the 
greenhouse gas reduction requirements that are anticipated, but also 
their optimization. To allow for the most rapid progression and 
dissemination of advanced biofuels technologies, the Department made a 
decision to allow for their advancement under this announcement 
utilizing the broader definition of advanced biofuels and allowable 
feedstocks contained in Section 207. This definition is less stringent 
than that contained in EISA Section 201 but as noted contains a more 
stringent greenhouse gas reduction requirement.

Cap-and-Trade

Q17.  In your testimony, in talking about the President's goal of 
passing a cap-and-trade bill, you state that ``Such legislation will 
provide the framework for transforming our energy system to make our 
economy less carbon-intensive, and less dependent on foreign oil.'' How 
will the R&D going on at DOE be affected by the passage of a cap-and-
trade bill?

A17. A cap-and-trade program would not have direct impacts on DOE R&D 
efforts unless there are provisions in the legislation that specify 
that proceeds from auction allowances are allocated to DOE R&D 
investment. A cap-and-trade system would help drive the clean energy 
transformation of the U.S. economy by driving increased private-sector 
spending on energy efficiency, renewable energy, carbon capture and 
storage, Smart Grid, and other clean energy technologies.
    Cap-and-trade legislation would also encourage increased private-
sector R&D spending on low-carbon technologies.

Question submitted by Representative Dana Rohrabacher

Q1.  You mentioned cost concerns whenever ``putting things in space'' 
is mentioned, and rightly so. The NSSO Study Report on Space-Based 
Solar Power, which I mentioned, states that the technology vectors are 
converging towards economic feasibility--not only for domestic use, but 
for forward deployed troops, for disaster recovery areas around the 
globe, and for a host of other ``off-grid'' activities. This report 
specifically takes into account the realities of cost concerns 
regarding space access. The report states that this system can provide 
baseload power, is pollution free, has no carbon emissions (which I 
know is among your goals, whether I agree with it or not), and can 
eliminate our reliance on foreign sources of energy (which I strongly 
do agree with). But in order to attain these benefits, the Federal 
Government needs to ``retire a major portion of the technical risk'' 
and ``become an early demonstrator/adopter/customer'' of Space-Based 
Solar Power. Will you use some portion of your significantly increased 
R&D budget toward these goals?

A1. The Department currently has no plans to support projects 
specifically focused on space-based solar systems. DOE's Solar Energy 
Technologies Program is focused on terrestrial solar applications to 
increase solar-based electricity generation and to achieve grid parity 
by 2015. However, several technologies under development have the 
characteristics--high efficiency, light weight, and radiation 
resistance--that space-based solar systems require. These technologies, 
which include CIGS (copper indium gallium selenide), concentrating 
solar power, and concentrating photovoltaics--could be adapted for 
space-based applications.

Questions submitted by Representative Brian P. Bilbray

Fusion Research

Q1.  The continuation of U.S. participation in ITER provides an 
opportunity for U.S. scientists to continue their contributions to 
magnetic fusion energy research, and signals a significant investment 
in this potential future energy source. What additional investments are 
needed--either in existing or new domestic initiatives or via 
additional international collaborations--so that the U.S. is prepared 
to move forward with a demonstration fusion power plant at the end of 
the ITER experiment? What is the Department's plan for making these 
investments?

A1. ITER is a large-scale international research collaboration that 
plans to build, operate, and eventually de-commission the world's first 
burning plasma fusion reactor. A successful fusion energy program 
requires not only the success of ITER, but additional research in a 
number of areas. Currently, the Fusion Energy Sciences (FES) program is 
in the process of identifying the remaining scientific challenges that 
need to be addressed in order to make fusion a potential future energy 
source. FES will use this information to develop a long-range strategic 
plan.

Q2.  The U.S. has made a large national investment in the National 
Ignition Facility (NIF) at LLNL and this device is now preparing for 
the National Ignition Campaign which is expected to demonstrate the 
first large energy gain in a laboratory fusion experiment. Clearly the 
U.S. can lead the world in this type of controlled fusion research. 
What is the Department's plan for capitalizing upon this investment and 
opportunity once ignition and gain is demonstrated on NIF, and how will 
the Secretary ensure that institutional barriers within the DOE 
organization do not hinder the Nation from seizing this opportunity?

     The current rate of progress in fusion research will not provide 
the Nation with the ability to pursue energy-producing demonstration 
reactors anytime in the foreseeable future. What resources is the 
Administration prepared to seek in order to provide a definitive 
determination of the feasibility of energy production from fusion 
energy?

A2. Successful completion of the National Ignition Campaign (NIC) on 
NIF will represent a large step forward in consolidating our scientific 
knowledge base for creating fusion by inertial confinement; however, a 
significant amount of research and development would still be required 
in making inertial fusion into an attractive power source. The National 
Nuclear Security Administration (NNSA) also has plans to utilize the 
results of NIC to produce a stable, reproducible ignition platform. In 
addition, NNSA and the Office of Science's Fusion Energy Sciences 
program have undertaken a joint program in High Energy Density 
Laboratory Plasmas to prepare us to exploit the scientific information 
coming from NIF, for both energy applications and other important 
national needs. We expect that this collaboration will provide an 
important starting point for efficient and effective interaction 
between NNSA and non-NNSA researchers in inertial fusion energy 
sciences and other high energy density research areas in the future.
    The Administration is examining all potential options for enhancing 
the Nation's energy security, especially the development of short-term 
solutions. Fusion represents a compelling longer-term option, which 
holds the possibility of energy by mid-century on the present track of 
R&D. We look forward to discussing the funding requirements for the 
entire portfolio of clean energy solutions with Congress in the coming 
months and years.

Q3.  In light of recent news reports about Cold Fusion research by the 
Navy's SPAWAR in partnership with a [San Diego-based] private sector 
company, what are the DOE's plans regarding this potentially ground-
breaking technology?

A3. The Office of Science (SC) and Office of Nuclear Energy recently 
received a briefing on the Cold Fusion research by the Navy's SPAWAR in 
partnership with a private sector company. The company was encouraged 
to have further discussions with several offices within SC. If the 
company wishes to submit a proposal for funding to any part of the DOE, 
including the recently established Advanced Research and Projects 
Agency-Energy (ARPA-E), then, just like any other proposal, it must go 
through a peer review to determine its scientific merit before any 
funding decision could be made.

Smart Grid/Energy Storage

Q4.  Mr. Secretary, your statement did not make reference to Smart Grid 
and advanced energy storage. Clearly, these are key components to 
achieving meaningful advances in the areas of renewable energy and 
distributed generation and it is my understanding that the Department 
is planning a robust portfolio of research funding opportunities on 
these topics. Can you provide us with a preview of how the Department 
plans to allocate research funding in these areas, and the degree to 
which these opportunities will be open to university researchers?

A4. The Department's FY 2010 budget request for the Office of 
Electricity Delivery and Energy Reliability includes $67 million for 
Smart Grid activities, and $15 million for energy storage research. 
This funding includes support for an energy innovation hub focused on 
smart materials and power electronics. In FY 2010, the Innovation Hub 
will be solicited through a competitive process, which is intended to 
include university researchers.

Biofuels Research

Q5.  In your testimony, you note that DOE has ``funded three Bioenergy 
Research Centers--one at the Oak Ridge National Laboratory in Oak 
Ridge, Tennessee; one led by the University of Wisconsin in Madison, 
Wisconsin, in close collaboration with Michigan State University in 
East Lansing, Michigan; and one led by the Lawrence Berkeley National 
Laboratory. Each of these centers is targeting breakthroughs in biofuel 
technology development that will be needed to make abundant, 
affordable, low-carbon biofuels a reality. While these efforts are 
still relatively new, they are already yielding results, such as the 
bioengineering of yeasts that can produce gasoline-like fuels, and the 
development of improved ways to generate simple sugars from grasses and 
waste biomass. We need to do more transformational research at DOE to 
bring a range of clean energy technologies to the point where the 
private sector can pick them up, including: 1. Gasoline and diesel-like 
biofuels generated from lumber waste, crop wastes, solid waste, and 
non-food crops . . .'' Does the Department now plan to fund similar 
national centers on a broader range of potential transportation fuel 
technologies, including non-food crop feedstocks such as algae? If so, 
could you outline the Department's plan for doing so?

A5. The Office of Science believes that the three integrated research 
centers now working on the development of cost-effective biofuels from 
cellulose (non-food plant fiber) represent an optimal investment. We 
have considered both the range of scientific challenges in this area 
and the resources of the scientific community working in this field. 
The work of the DOE Bioenergy Research Centers is supplemented by 
additional systems biology research related to bioenergy, primarily 
grants to individual investigators within the Genomic Science program 
in the Office of Science's Biological and Environmental Research 
program. There is also important applied research related to biofuels, 
including algal biofuels, underway or planned by the Office of Energy 
Efficiency and Renewable Energy. Using Recovery Act funding, the Energy 
Efficiency Office's Biomass program intends to issue a Funding 
Opportunity Announcement to address research and development efforts 
related to algal advanced biofuels. DOE expects to publish the 
announcement in the summer of 2009. The special notice announcing this 
intent was posted on the Energy Efficiency website on May 5, 2009.

Q6.  In response to a question posed by Senator Lamar Alexander (R-TN) 
during a March 11th Senate Budget Committee hearing, you agreed that 
algae was indeed promising, but that it required a ``tremendous amount 
of surface area'' to cultivate. Algae actually produce over 14 times 
more BTUs of energy per acre per year than corn. Would you agree that 
you and your staff at the Department of Energy (DOE) should seek to 
learn more about algal biofuel technologies from companies like 
Sapphire Energy, a company located in La Jolla that recently tested its 
algal jet fuel on a commercial dual engine jet with great success, to 
correct such misperceptions?

A6. Certain types of micro-algae can accumulate high concentrations of 
energy-dense storage lipids, which can be turned into biofuels. It is 
true that if a higher concentration of these lipids can be achieved, 
then a smaller surface area will be required to produce the same amount 
of biofuel. However, additional research and development is needed to 
reduce cost of algal biofuels production, due to substantial scale-up 
barriers. The Department is very interested in the potential of algae, 
and recently held the National Algal Biofuels Technology Roadmap 
workshop in December 2008 to solicit input from leading experts, such 
as Sapphire Energy. It is our plan to use this Roadmap to inform future 
R&D efforts on algal biofuels.

Q7.  How is the DOE poised to help algae companies like Sapphire, which 
currently has a shovel-ready pre-commercial project in Las Cruces, NM, 
succeed? And how will the DOE help algae companies achieve a level 
playing field with cellulosic ethanol companies that have had years of 
money and research and development support from the DOE and its 
national labs?

A7. The DOE recently announced a Notice of intent to use $50 million of 
Recovery Act funding to fund an algal biofuels consortium. The 
consortium will be a multi-disciplinary team selected via a competitive 
peer-reviewed solicitation process. Industry leaders, such as Sapphire 
Energy, are encouraged to participate. This consortium is part of a 
larger DOE effort to accelerate the development of advanced fungible 
biofuels (non-ethanol). In addition, algae companies are welcome to 
compete in our solicitation for pilot and demonstration-scale 
integrated biorefinery.

Q8.  Given the clear statement of congressional intent in the FY09 
omnibus regarding research into alternative transportation fuels 
derived from non-food crops, such as algae, (see bill language 
following this question) what can you tell us about DOE's plan for 
spending the $800 million designated in the stimulus bill for biomass 
research? Title III, Energy Efficiency and Renewable Energy Biomass and 
Biorefinery Systems R&D--the bill includes $217,000,000 for integrated 
research and development on biomass and biorefinery systems. The 
Department should pursue development of biofuels from non-food sources, 
especially those with the largest potential to sequester industrial 
carbon dioxide, such as algae, that are also compatible with gasoline 
and diesel fuels.

A8. The $800 million for biomass related projects from the Recovery Act 
includes: $480 million for integrated pilot- and demonstration-scale 
biorefineries; $176.5 million for increased investment in existing 
commercial-scale biorefinery projects; $85 million to create research 
consortia for infrastructure-compatible and algal biofuels; $25 million 
for sustainability research through the Office of Science Bioenergy 
Research Centers and to establish a user-facility/small-scale 
integrated pilot plant; $20 million to optimize flex-fuel vehicles 
operating on high octane E85 fuel, to evaluate the impact of higher 
ethanol blends in conventional vehicles, and to upgrade existing 
refueling infrastructure to be compatible with fuels up to E85; and 
$13.5 million to expand the pretreatment capacity and options at the 
National Renewable Energy Laboratory Integrated Biorefinery Research 
Facility.

Spent Nuclear Fuel Storage

Q9.  In the absence of Yucca Mountain, what would be your plan for the 
disposition of DOE-spent fuel and high level waste accumulating at DOE 
EM cleanup sites at Hanford, Idaho and Savannah River? Without Yucca 
Mountain, what is your plan to comply with current agreements between 
the Federal Government and the states that require the removal of these 
radioactive materials on a stipulated and binding legal agreement?

A9. For the near-term, existing Departmental policy for managing High-
Level Waste (HLW) and Spent Nuclear Fuel (SNF) remains unchanged. 
Current plans provide for safe storage of the material for one to two 
decades. With adequate maintenance and surveillance, it is estimated 
these materials could be stored at our sites for a longer period of 
time, potentially as long as 100 years, and still be safely retrieved. 
The Administration intends to convene a ``blue-ribbon'' panel of 
experts to evaluate alternative approaches for meeting the federal 
responsibility to manage and ultimately dispose of spent nuclear fuel 
and high-level radioactive waste from both commercial and defense 
activities.

Q10.  Do you know what the current estimated liability is? In your 
view, if the Yucca program does not go forward, is not properly funded 
or is otherwise terminated, what in your view would be the total 
estimated liability if U.S. utilities filed for full breach of contract 
with DOE?

A10. The Department has estimated the liability resulting from the 
delay in beginning waste acceptance in 1998 would be $12.3 billion, 
assuming performance beginning in 2020. The amount of government 
liability that might result from a ``full'' breach of contract would be 
based on a number of variables that are not quantifiable at this time.

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