[Senate Hearing 111-]
[From the U.S. Government Publishing Office]



 
    ENERGY AND WATER DEVELOPMENT APPROPRIATIONS FOR FISCAL YEAR 2010

                              ----------                              


                         TUESDAY, MAY 19, 2009

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 10:22 a.m., in room SD-138, Dirksen 
Senate Office Building, Hon. Byron L. Dorgan (chairman) 
presiding.
    Present: Senators Dorgan, Murray, Feinstein, Reed, Tester, 
Bennett, Cochran, and Alexander.

                          DEPARTMENT OF ENERGY

STATEMENT OF HON. STEVEN CHU, SECRETARY


              opening statement of senator byron l. dorgan


    Senator Dorgan. I'm going to call the hearing to order. 
This is a hearing of the Energy and Water Subcommittee of the 
Appropriations Committee. Dr. Chu, we welcome you to the 
subcommittee this morning. I'm sorry for the inconvenience. 
We're starting a few minutes late. I think probably all three 
of us were on the floor of the Senate, waiting for a 10 or 
10:15 vote to occur, and we were just informed it won't occur 
now, but will occur sometime in the future, either in the short 
term or the longer term, any moment, or perhaps sometime today. 
So that's the reason I was a bit delayed.
    We have asked Secretary Chu from the Department of Energy 
to come and present and discuss the 2010 budget. My expectation 
is that we will be truncated a bit and probably be interrupted 
with a short recess for a cloture vote. I want to note that we 
will have Administrator D'Agostino before the subcommittee on 
June 2, to discuss the National Nuclear Security 
Administration's budget request. We're free to discuss any of 
that today as well, but I simply want to remind members that 
there will be further opportunity to discuss that in 2 weeks' 
time.
    This year's budget of $27.1 billion for the Department is 
basically flat compared to 2009 appropriation numbers. A 
substantial sum of money, a great deal of money, was provided--
$38.7 billion as a part of the American Recovery and 
Reinvestment Act. Those numbers, of course, were not intended 
to be a substitute for the regular budget. They were intended 
for the purpose of moving money around the country, getting 
people to work, getting contractors working and building 
projects and doing things that are of substantial value, and 
creating assets for the future.
    I was a bit surprised when I received the President's 
budget. Because I felt that with the economy recovery funds, a 
very substantial amount of money, $38.7 billion, to the 
Department, that we might see a very different approach in 
trying to deal with the priorities in the Department. And I'm 
going to talk to you today about some of the strengths that I 
see in the budget request and some of the concerns that I have.
    I think there are some good stories in the funding increase 
proposals. I think we have to maximize the capability of 
renewable energy in our country. In order to do that, we not 
only have to say, ``Here's where the country's headed,'' and 
plot a map to get there, but we have to create the capability 
to have an interstate transmission capability that connects all 
of America. That's not easy, that's very difficult to do.
    The science budget is robust. There's also a proposal for 
eight new Energy Innovation Hubs, which I view as a means of 
helping the Department of Energy address what normally people 
call the Valley of Death, the dilemma of getting technology 
transferred from basic science to applied research and then out 
into the marketplace, so that it accomplishes what we intend to 
accomplish in the field of energy for our country's future.
    I'm going to just truncate my statement. I will, during the 
questioning, have an opportunity to go through a wide range of 
subjects with you, Secretary Chu. I think what I'd like to do, 
with the permission of our colleagues, is call on Senator 
Bennett for a brief opening statement, call on the Secretary to 
make a presentation. Perhaps about that time, we'll have to go 
over for the cloture vote. And then come back and have 
substantial opportunity this morning to ask questions of the 
Secretary.
    If that is all right with my colleagues, let me call on the 
ranking member, Senator Bennett.


             OPENING STATEMENT OF SENATOR ROBERT F. BENNETT


    Senator Bennett. Thank you very much, Mr. Chairman. I will 
abbreviate my opening statement. Mr. Secretary, welcome to the 
subcommittee. We're glad to have you here in your first 
experience in defending your budget. And having served in the 
executive branch myself, I know that this isn't entirely your 
budget, that the OMB has had a few suggestions, shall we say. 
And you may or may not be pleased with those, but I won't call 
on you to defend or comment on those.
    Just a few highlights, you apply additional resources to 
programs that appear to already enjoy some surpluses, but fail 
to address chronic pension shortfalls that have been created by 
the poor market performance. Now, I understand that these could 
not be foreseen, but I don't think it's acceptable to ignore 
the estimated $500 to $600 million shortfall spread across the 
Department and the impact that that will have in undercutting 
scientific and cleanup missions.
    I continue my interest in NNSA and the labs, and would be 
interested in talking to you about that and some of the 
comments that you've made there. The Office of Science and 
Renewable Energy has received nearly 50 percent of the stimulus 
funding, and it seems unlikely that this will be spent before 
the 2010 deadline. So we could talk about how that could be 
shifted, it's not a matter of I don't favor this kind of thing, 
but you can only shovel so much money out the door in certain 
circumstances, and that's one thing that I would look at.
    Funding for environmental cleanup is down $161 million. 
There are two other factors that significantly increase the 
deficit of this program. It fails to fully fund the pension 
shortfalls that will reduce environmental cleanup by an 
estimated $400 million in fiscal year 2010, and I've included 
an amendment to the budget resolution to mitigate the impacts 
that budgets will have on the cleanup. And I'm grateful, Mr. 
Chairman, for your support in that effort.
    The budget includes a $200 million tax on uranium fuel to 
be paid by utilities, offsetting this to our overall budget 
authority. If we don't do this--and it's frankly a little bit 
of a budget gimmick--it creates a $200 million shortfall in our 
bill. And this revenue isn't necessary, as there is $4.5 
billion in existing balances. Those kinds of details, we would 
talk through.
    So with that, Mr. Chairman, I will leave it there and do 
the best we can to move the hearing forward.
    Senator Dorgan. Senator Bennett, thank you very much. Mr. 
Secretary, I know that you personally worked hard on the budget 
that was presented to us, but you did so with very limited time 
and also with very limited staff. I regret that a good number 
of your nominations are all being held up. I have spoken to the 
Senator that has the hold. It's a hold that's very Byzantine, 
as far as I'm concerned, because that Senator has been promised 
a hearing date, which is what he wanted. So I hope that you get 
those nominations through so that you can have a full 
complement of staff.
    But having done what you have done, please tell us the 
justification for the administration's budget proposals for the 
Department of Energy. Mr. Secretary, thank you for being here.


                      STATEMENT OF HON. STEVEN CHU


    Secretary Chu. Okay, thank you. Chairman Dorgan, Ranking 
Member Bennett, members of the subcommittee, I am pleased to be 
before you today to present President Obama's fiscal year 2010 
budget request for the Department of Energy.
    The President's 2010 budget seeks to usher in a new era of 
responsibility, an era in which we invest to create new jobs 
and lift our economy out of recession, while laying a new 
foundation for our long-term growth and prosperity.
    President Obama's 2010 budget invests in clean, renewable 
sources of energy, so we can reduce our dependence on oil, 
address the threat of a changing climate, and become the world 
leader in new, clean energy economy.
    The 2010 budget request for the Department of Energy is 
$26.4 billion, essentially flat compared to fiscal year 2009, 
and it complements the significant energy investments in the 
American Recovery and Reinvestment Act. This budget request 
emphasizes science, discovery, and innovation to support the 
key missions of the Department.
    My written testimony includes an extensive breakdown of 
this budget, and I'd like to use this time briefly to highlight 
a few numbers and areas of particular importance. To promote 
nuclear security in the President's ambitious non-proliferation 
goals, the budget requests $9.9 billion for the National 
Nuclear Security Administration.
    To continue to accelerate legacy cleanup of our Nation's 
nuclear weapons production, the budget requests $5.8 billion 
for the Office of Environmental Management. To bolster the 
Department's commitment to scientific discovery, the budget 
requests $4.9 billion for the Office of Science. And fostering 
the revolution in energy supply and demand while positioning 
the United States to lead on a global climate change policy, 
the budget includes requests for a range of energy investments, 
including $882 million for the Office of Fossil Energy, $845 
million for the Office of Nuclear Energy, and $2.3 billion for 
the Office of Energy Efficiency and Renewable Energy.
    That clean energy funding includes several notable 
strategic investments, even as this budget holds the line on 
spending overall. Solar power will receive $320 million, an 
increase of 82 percent. Wind energy is funded at $75 million, 
an increase of 36 percent. Funding for clean vehicle programs 
is up 22 percent to $333 million, and funding for building 
technologies is increased by 69 percent to $238 million.
    Another significant increase is in the Office of 
Electricity Delivery and Energy Reliability, which received 
$208 million, 52 percent more than in fiscal year 2009, as it 
works to develop a new smart electric grid. The request also 
includes funding to implement the Loan Guarantee Program and 
Advanced Technology Vehicle Manufacturing Loan Program.
    With that brief overview, I want to turn to one of my top 
priorities in the budget as Secretary, amplifying the Office of 
Science's fundamental research with innovative approaches to 
solving the Nation's energy problems. Specifically, this budget 
request includes three initiatives designed to cover a spectrum 
of basic to applied science to maximize our chances of energy 
breakthroughs. The fiscal year 2010 budget will launch eight 
Energy Innovation Hubs, while the Energy Frontier Research 
Centers and the ARPA-E were launched last month.
    Let me briefly explain the differences among these 
initiatives and why I believe launching these hubs is so 
important. The EFRCs are small-scale collaborations, 
predominately universities, that focus on overcoming known 
hurdles in basic science that block energy breakthroughs, not 
on developing energy technologies themselves.
    ARPA-E is a highly entrepreneurial funding model that 
explores potentially revolutionary technologies that are too 
risky for industry to fund. The proposed Energy Innovation Hubs 
will take a very different approach. They will be multi-
disciplinary, highly collaborative teams, ideally working under 
one roof to solve priority technology challenges, such as 
artificial photosynthesis, or creating fuels from sunlight.
    A few years ago, I changed the course of my scientific work 
to focus on solving our energy and climate challenges because 
of the urgency of this issue and because I remain optimistic 
that science can offer better solutions than we can imagine 
today. But those solutions will only come if we harness the 
creativity and ingenuity and intellectual horsepower of our 
best scientists in the right way.
    I'm convinced that launching Energy Innovation Hubs is a 
critical next step in this effort. Bringing together the best 
scientists from different disciplines in a collaborative effort 
is our best hope of achieving priority goals, such as making 
solar energy cost competitive with fossil fuels, or developing 
new building designs that use dramatically less energy, or 
developing an economical battery that will take your car 300 
miles without recharging.
    These are the breakthroughs we need, and the Energy 
Innovation Hubs will help us achieve them. I saw the power of 
truly collaborative science like this firsthand during my time 
at Bell Laboratories. I believe that to solve the energy 
problem, the Department of Energy must strive to be the modern 
version of Bell Laboratories in energy research, and this is 
what these hubs will do. These investments will pay for 
themselves many times over and enhance America's 
competitiveness on the green energy jobs of tomorrow.
    A final initiative in the fiscal year 2010 budget is a 
comprehensive K-20+ science and engineering effort called RE-
ENERGYSE, standing for REgaining our ENERGY Science and 
Engineering Edge, funded at $115 million. Through RE-ENERGYSE, 
the Department will partner with the National Science 
Foundation to educate thousands of students at all levels in 
the fields that contribute to our fundamental understanding of 
energy science and engineering systems.


                           PREPARED STATEMENT


    It is my firm belief that the short-term impact of the 
Recovery Act, combined with the long-term vision in President 
Obama's fiscal year 2010 budget, will lay the necessary 
groundwork for a clean economy. Both President Obama and I look 
forward to working with the 111th Congress to make this vision 
a reality. I appreciate this opportunity to appear before you, 
and I'm happy to take questions at this time.
    [The statement follows:]

                 Prepared Statement of Hon. Steven Chu

    Chairman Dorgan, Ranking Member Bennett, members of the 
subcommittee, I am pleased to be before you today to present President 
Obama's fiscal year 2010 budget request for the Department of Energy.
    The President's 2010 budget seeks to usher in a new era of 
responsibility--an era in which we invest to create new jobs and lift 
our economy out of recession, while laying a new foundation for our 
long-term growth and prosperity.
    The fiscal year 2010 budget request of $26.4 billion provides the 
next critical investment in a multi-year effort to address the 
interconnected challenges of economic uncertainty, U.S. dependence on 
oil, and the threat of a changing climate by transforming the way our 
Nation produces and consumes energy. 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. We will also train the next generation of 
a technical workforce and the scientific researchers needed to maintain 
the United States' preeminent position in science and technology. At 
its core, this budget request emphasizes science, discovery, and 
innovation to support the key missions of the Department.
    I want to note at the outset that in developing the fiscal year 
2010 request the Department considered that the $38.7 billion of 
American Recovery and Reinvestment Act of 2009 (Recovery Act) funding 
received by the Department allows for the acceleration of a number of 
important commitments. The Recovery Act makes investments in energy 
conservation and renewable energy sources ($16.8 billion), 
environmental management ($6 billion), loan guarantees for renewable 
energy and electric power transmission projects ($6 billion), grid 
modernization ($4.5 billion), carbon capture and sequestration ($3.4 
billion), basic scientific research ($1.6 billion), and the 
establishment of the Advanced Research Projects Agency-Energy (ARPA-E) 
($400 million). These investments will help jumpstart the economy, save 
and create jobs, and serve as a down payment on addressing fundamental 
energy challenges, while reducing carbon emissions and U.S. dependence 
on oil.

      INVESTING IN SCIENCE TO ACHIEVE TRANSFORMATIONAL DISCOVERIES

    The fiscal year 2010 budget request supports our strategic 
framework by:
  --Investing in science to achieve transformational discoveries;
  --Fostering the revolution in energy supply and demand while 
        positioning the United States to lead on global climate change 
        policy;
  --Increasing American economic competitiveness;
  --Maintaining the nuclear deterrent, reducing the risk of nuclear 
        proliferation, and advancing nuclear legacy cleanup; and
  --Improving the management of the Department.
    The President has committed to doubling Federal investment in basic 
research over 10 years. The Department will support this commitment by 
investing in basic and applied research, creating new incentives for 
private innovation, and promoting breakthroughs in energy. Our Nation's 
ability to sustain a growing economy and a rising standard of living 
for all Americans depends on continued advances in science and 
technology. Scientific and technological discovery and innovation are 
the major engines of increasing productivity and are indispensable to 
ensuring economic growth, job creation, and rising incomes for American 
families in the technologically-driven 21st century.
    As Secretary, one of my top priorities is to amplify the 
fundamental research undertaken by the Office of Science with novel 
approaches to solving the Nation's energy problems. While the 
Department has made important contributions over the years, despite 
almost three decades of effort, we are still confronted by the 
fundamental problems of energy security and environmental degradation 
from our energy use. That is why I am proposing new approaches to 
solving the energy question. Specifically, this budget request includes 
three initiatives designed to cover the spectrum of basic to applied 
science to maximize our chances of energy breakthroughs. The fiscal 
year 2010 budget will launch eight Energy Innovation Hubs, while the 
Energy Frontier Research Centers (EFRCs) and ARPA-E were launched last 
month.
    Let me briefly explain the differences and why I believe launching 
these Hubs is so important.
    EFRCs are small-scale collaborations (predominantly at 
universities) that focus on overcoming known hurdles in basic science 
that block energy breakthroughs--not on developing energy technologies 
themselves.
    ARPA-E is a highly entrepreneurial funding model that explores 
potentially revolutionary technologies that are too risky for industry 
to fund.
    The proposed Energy Innovation Hubs will take a very different 
approach--they will be multi-disciplinary, highly collaborative teams 
ideally working under one roof to solve priority technology challenges, 
such as artificial photosynthesis (creating fuels from sunlight).
    A few years ago, I changed the course of my scientific work to 
focus on solving our energy and climate challenges. I did so because of 
the great national and global urgency of this issue--but also because, 
as a scientist, I remain optimistic that science can offer us better 
solutions than we can imagine today. But those solutions won't come 
easily; they will only come if we harness the creativity and ingenuity 
and intellectual horsepower of our best scientists in the right way.
    Having dedicated the last several years of my work to solving the 
energy challenge, I'm convinced that launching Energy Innovation Hubs 
is a critical next step in this effort. Bringing together the best 
scientists from different disciplines in collaborative efforts is our 
best hope of achieving priority goals such as making solar energy cost 
competitive with fossil fuels, or developing new building designs that 
use dramatically less energy, or developing an economical battery that 
will take your car 300 miles without recharging.
    These are the breakthroughs we need--and the Energy Innovation Hubs 
will help us achieve them. I saw the power of truly collaborative 
science like this firsthand during my time at Bell Laboratories. I 
believe that to solve the energy problem, the Department of Energy must 
strive to be the modern version of Bell Labs in energy research, and 
that is what these Hubs will do.
    The scientific collaboration the Hubs will foster will be unique 
and indispensable, and must be backed by a meaningful and sustained 
investment. These investments will pay for themselves many times over, 
ensuring American leadership and American competitiveness when it comes 
to the green energy jobs of tomorrow.
    The following is additional information about the three 
initiatives:
  --Energy Innovation Hubs.--In fiscal year 2010 the Department 
        proposes to fund eight multi-disciplinary Energy Innovation 
        Hubs, at a total of $280 million. Modeled after the 
        Department's Bioenergy Research Centers, the work of the Hubs 
        will span from basic research to engineering development to 
        commercialization and a hand-off to industry. Each Hub will be 
        funded at $25 million per year, with one-time additional start-
        up funding of $10 million in the first year for renovation, 
        equipment and instrumentation.
      The Hubs will support cross-disciplinary research and development 
        focused on the barriers to transforming energy technologies 
        into commercially deployable materials, devices, and systems. 
        They will advance highly promising areas of energy science and 
        technology from their early stages of research to the point 
        that the risk level will be low enough for industry to deploy 
        them into the marketplace. While the intent is to provide a 
        funding stream that is more dependable than the standard 
        funding mechanisms, renewal after 5 years will not be 
        automatic. To receive renewed funding, Hubs will be expected to 
        be delivering exceptional scientific progress.
      The research Hubs will explore the following topics: Solar 
        Electricity; Fuels from Sunlight; Batteries and Energy Storage; 
        Carbon Capture and Storage; Grid Materials, Devices, and 
        Systems; Energy Efficient Building Systems Design; Extreme 
        Materials; and Modeling and Simulation.
  --Energy Frontier Research Centers.--In fiscal year 2010 the 
        Department of Energy will continue to support Energy Frontier 
        Research Centers (EFRC). Currently there are 46 EFRCs, funded 
        at $2 to $5 million per year. These centers enlist the talents 
        and skills of the very best scientists and engineers to address 
        current fundamental scientific roadblocks to clean energy and 
        energy security. Roughly one-third of the centers are supported 
        by Recovery Act funding. These centers, involving almost 1,800 
        researchers and students from universities, national labs, 
        industry, and non-profit organizations from 36 States and the 
        District of Columbia, address the full range of energy research 
        challenges in renewable and low-carbon energy, energy 
        efficiency, energy storage, and cross-cutting science. EFRC 
        researchers take advantage of new capabilities in 
        nanotechnology, light sources that are a million times brighter 
        than the sun, supercomputers, and other advanced 
        instrumentation, much of it developed in collaboration with the 
        Department of Energy's Office of Science.
  --Advanced Research Projects Agency-Energy (ARPA-E).--ARPA-E is a new 
        Department of Energy organization modeled after the Defense 
        Advanced Research Projects Agency, created during the 
        Eisenhower administration in response to Sputnik. The Recovery 
        Act provided $400 million and the fiscal year 2010 budget 
        requests $10 million for ARPA-E. The purpose of ARPA-E is to 
        advance high-risk, high-reward energy research projects that 
        can yield revolutionary changes in how we produce, distribute, 
        and use energy. It will ensure that the United States maintains 
        a technological lead in developing and deploying advanced 
        energy technologies.
      ARPA-E seeks out the best ideas and assembles teams that can move 
        quickly to help bring the idea to market, and funds this work 
        through grants that range between $500,000 and $10 million. 
        Most projects will be funded with seed money that sunsets after 
        3 years. Research teams are expected to either make 
        exceptionally rapid progress or bring their technology to the 
        point the private sector can pick it up within that time.
    These initiatives will be augmented with a broad educational effort 
that cuts across DOE program offices to inspire students and workers to 
pursue careers in science, engineering, and entrepreneurship 
specifically related to clean energy. This education effort will help 
to develop the scientific and technical expertise to sustain the new 
energy economy and increase American competitiveness.
  --RE-ENERGYSE (REgaining our ENERGY Science and Engineering Edge).--
        As part of President Obama's recent address before the National 
        Academy of Sciences on reinvigorating scientific research and 
        innovation in the United States, the President announced a 
        joint education initiative between the National Science 
        Foundation and the Department of Energy to ``inspire tens of 
        thousands American students to pursue careers in science, 
        engineering and entrepreneurship related to clean energy.''
      As part of this initiative, the Department will launch a 
        comprehensive K-20+ science and engineering initiative, funded 
        at $115 million in fiscal year 2010, to educate thousands of 
        students at all levels in the fields contributing to the 
        fundamental understanding of energy science and engineering 
        systems. This initiative, which complements the Department's 
        other education efforts, will provide graduate research 
        fellowships in scientific and technical fields that advance the 
        Department's energy mission; provide training grants to 
        universities that establish multidisciplinary research and 
        education programs related to clean energy; support 
        universities that dramatically expand energy-related research 
        opportunities for undergraduates; build partnerships between 
        community colleges and different segments of the clean tech 
        industry to develop customized curriculum for ``green collar'' 
        jobs; and increase public awareness, particularly among young 
        people, about the role that science and technology can play in 
        responsible environmental stewardship.

Office of Science
    The fiscal year 2010 budget requests $4.9 billion for the Office of 
Science, a $184 million increase over fiscal year 2009. In general, the 
2010 request will focus on breakthrough science while developing and 
nurturing science and engineering talent. It will also increase funding 
for climate science and continue America's role in international 
science and energy experiments. The budget also invests in the next 
generation of America's scientists by expanding graduate fellowship 
programs in critical energy-related fields. This funding builds upon 
the $1.6 billion provided in the Recovery Act for basic science 
programs at the Department of Energy.
    The Office of Science supports investigators from more than 300 
academic institutions and from all of the DOE laboratories. The fiscal 
year 2010 budget request will support about 25,000 Ph.D.s, graduate 
students, undergraduates, engineers, and technicians. Approximately 
24,000 researchers from universities, national laboratories, industry, 
and international partners are expected to use the Office of Science's 
scientific user facilities. The fiscal year 2010 request supports the 
President's plan to increase Federal investment in the sciences and 
train students and researchers in critical fields, to invest in areas 
critical to our clean energy future, and to make the United States a 
leader on climate change.
    Two of the Department's eight Energy Innovation Hubs are requested 
in the Office of Science in fiscal year 2010 ($70 million). These Hubs 
will bring together teams of experts from multiple disciplines to focus 
on two grand challenges in energy: the creation of fuels directly from 
sunlight without the use of plants or microbes and advanced methods of 
electrical energy storage.
    The Office of Science supports a diverse number of research 
programs including:
  --High-Energy Physics ($819 million)
  --Nuclear Physics ($552 million)
  --Biological and Environmental Research ($604 million)
  --Basic Energy Sciences ($1.7 billion)
  --Advanced Scientific Computing Research ($409 million)
  --Fusion Energy Sciences ($421 million)
fostering the revolution in energy supply and demand while positioning 
       the united states to lead on global climate change policy
    U.S. dependence on oil is a national security challenge. 
Furthermore, the United States has a responsibility to curb carbon 
emissions to mitigate the effects of global climate change. The fiscal 
year 2010 budget request will expand the use of low-carbon and 
renewable energy sources and efficiency, and support the Smart Grid. 
Deploying these technologies will position the United States to lead on 
global climate change policy.

Energy Efficiency and Renewables
    Achieving these goals requires changes to both the demand and 
supply of energy. DOE is addressing both by improving the Nation's 
energy efficiency to reduce energy demand and by investing in 
technologies and approaches to transform energy supply and 
transmission. The fiscal year 2010 budget request of $2.3 billion for 
the Office of Energy Efficiency and Renewable Energy (EERE) will 
transform the Nation's energy infrastructure by investing in a variety 
of renewable sources of electricity generation and deploying 
technologies to reduce our dependence on oil and decrease energy use in 
homes, transportation, and industry. These sources of energy will 
reduce the production of GHG emissions and usher in a revitalized 
economy built on the next generation of domestic production. 
Investments in efficiency R&D, grants to States and weatherization 
assistance will have immediately tangible benefits by reducing energy 
use, lowering energy bills, and reducing GHG emissions and helping to 
create jobs across the country.
    This budget request for EERE provides a diverse portfolio of 
solutions to our energy and environmental challenges. This starts with 
improving energy efficiency, which can be one of the cheapest, cleanest 
means of reducing greenhouse gas emissions. The budget includes 
significant increases in several programs in support of the President's 
efforts to promote energy efficiency, including these increases:
  --Building Technology Program $238 million (+$98 million or 69 
        percent)
  --Vehicle Technology Program $333 million (+$60 million or 22 
        percent); and
    The budget continues the shift to clean and renewable energy, 
including these increases:
  --Solar Energy Program $320 million (+$145 million, or 82 percent);
  --Wind Energy Program $75 million (+$20 million, or 36 percent); and
  --Geothermal Program $50 million (+$6 million or 14 percent.)
    The budget also has funding for:
  --Fuel Cells Technology ($68.2 million)
  --Biomass and Biorefinery Systems R&D ($235 million)
  --Water Power ($30 million)
  --Industrial Technologies ($100 million)
  --FEMP ($32.3 million)
  --Weatherization ($220 million)
  --State Energy Program Grants ($75 million)

Electricity Transmission and Reliability
    The Nation's ability to meet the growing demand for reliable 
electricity is challenged by an aging electricity transmission and 
distribution system and by vulnerabilities in the U.S. energy supply 
chain. Despite increasing demand, the United States has experienced a 
long period of underinvestment in power transmission and infrastructure 
maintenance. The majority of the power delivery system was built on 
technology developed in the 1960s, 1970s and 1980s and is limited by 
the speed with which it can respond to disturbances. This limitation 
increases the vulnerability of the power system to outages that can 
spread quickly and have regional effects. Deploying the next generation 
of clean energy sources will require modernization of U.S. energy 
infrastructure which will rely on digital network controls and 
transmission, distribution and storage breakthroughs.
    The proposed fiscal year 2010 Office of Electricity Delivery and 
Energy Reliability budget provides $208 million, an increase of 52 
percent over fiscal year 2009, and builds on the ``smart grid'' 
investments and other activities to modernize and secure the electric 
grid provided by $4.5 billion of Recovery Act funds, supporting the 
following areas:
  --Clean energy transmission and reliability ($42 million)
  --Smart grid research and development ($67 million)
  --Energy storage ($15 million)
  --Cyber security for energy delivery systems ($50 million)
  --Permitting, siting and analysis ($6.4 million)
  --Infrastructure security and energy restoration ($6.2 million)

Fossil Energy
    The fiscal year 2010 budget request of $882 million for the Office 
of Fossil Energy (FE) will help ensure that the United States can 
utilize traditional domestic energy resources in a clean and affordable 
manner. The United States has 25 percent of the world's coal reserves, 
and fossil fuels currently supply 86 percent of the Nation's energy. 
Low-carbon emissions coal plants and production of methane (natural 
gas) from gas hydrates will help allow fossil fuels to be used as 
abundant and low-carbon emitting energy resources. In direct support of 
the Department of Energy's Energy Security mission, $229 million of the 
$882 million has been requested to provide operations, maintenance and 
repair funding for a Strategic Petroleum Reserve program that is 
environmentally responsible and fully responsive to the needs of the 
Nation and the public, protecting against potential disruptions in 
foreign and domestic petroleum supplies.
    The Department is committed to advancing Carbon Capture and Storage 
(CCS) technologies in order to promote cleaner and efficient use of 
fossil fuels. The $3.4 billion in Recovery Act funds, combined with 
$222 million requested in fiscal year 2010 for CCS research and 
development, is the keystone of the Department's clean coal research 
program which seeks to establish the capability of producing 
electricity from coal with dramatically reduced atmospheric emissions 
of carbon dioxide.
    In fiscal year 2010, the Energy Innovation Hub for CCS will focus 
on enabling fundamental advances and discovery of novel and 
revolutionary capture/separation approaches to dramatically reduce the 
energy penalty and cost associated with CO2 capture.
    The fiscal year 2010 budget request for FE funds the following 
areas:
  --Coal ($403.9 million) including $179.9 million for carbon 
        sequestration
  --Fossil energy research and development ($617.6 million)
  --Naval Petroleum and Oil Shale Reserves ($23.6 million)
  --Strategic Petroleum Reserve ($229.1 million)
  --Northeast Home Heating Oil Reserve ($11.3 million)

Nuclear Energy
    The $845 million budget request for the Office of Nuclear Energy 
(NE) recognizes that nuclear energy is a fundamental component of the 
energy mix which currently supplies approximately 20 percent of the 
Nation's electricity and over 70 percent of low carbon emitting 
electricity.
    In order to research and develop nuclear energy technologies that 
could help meet non-proliferation and climate goals, and to maintain 
the national nuclear technology infrastructure, the fiscal year 2010 
budget request for NE funds the following areas:
  --Nuclear Power 2010 ($20 million)
  --Generation IV ($191 million)
  --Fuel Cycle Research and Development Program ($192 million)
  --Radiological Facilities Management ($77 million)
  --Idaho Facilities Management ($203 million)

Loan Guarantee Program
    In fiscal year 2010, the DOE will continue to accelerate the 
availability of loans for innovative technologies through the Loan 
Guarantee Program, while ensuring taxpayer interests are protected. The 
Department requests $43.0 million in funding in fiscal year 2010 to 
operate the Office and support personnel and associated costs. This 
request will be offset by collections authorized under title XVII of 
the Energy Policy Act of 2005 (EPACT 2005). Additionally, the fiscal 
year 2010 budget provides $20 million for administrative costs to help 
enable the Advanced Technology Vehicle Manufacturing Loan Program to 
support up to $25 billion in loans to automobile and automobile part 
manufacturers for re-equipping, expanding, or establishing 
manufacturing facilities to produce advanced technology vehicles or 
qualified components.

    MAINTAINING THE NUCLEAR DETERRENT, REDUCING THE RISK OF NUCLEAR 
          PROLIFERATION, AND ADVANCING NUCLEAR LEGACY CLEAN-UP

Nuclear Security
    The National Nuclear Security Administration (NNSA) continues 
significant efforts to meet administration and secretarial priorities, 
leveraging science to promote national security. The fiscal year 2010 
President's budget request is $9.9 billion, which is $815 million more 
than the fiscal year 2009 request, to meet defense and homeland 
security-related objectives.
    The United States continues a fundamental shift in national 
security strategy to address the realities of the 21st century. The 
fiscal year 2004 directed reductions to the U.S. nuclear weapons 
stockpile were completed in 2007, 5 years early. Today's nuclear 
weapons stockpile is now the size envisioned for 2012, and by 2012 it 
will be almost 15 percent less than that--a total that is just 25 
percent of what it was at the end of the cold war. Consistent with the 
administration's Nuclear Posture Review, the Department of Energy has 
created a vision for a revitalized nuclear weapons complex that is 
significantly more agile and responsive, and will allow further 
reductions in the nuclear stockpile by providing an industrial hedge 
against geopolitical or technical problems.
    The fiscal year 2010 budget request for NNSA funds the following 
areas:
  --Weapons Activities ($6.4 billion)
  --Defense Nuclear Nonproliferation ($2.14 billion)
  --Naval Reactors ($1.0 billion): $175 million increase from fiscal 
        year 2009
  --Office of the Administrator ($420.8 million)

Environmental Management
    The Federal Government has the dual responsibilities of addressing 
the nuclear weapons production legacy of our past and providing the 
necessary environmental infrastructure for today that will ensure a 
clean, safe and healthy environment for future generations. To deliver 
on the Department's obligations stemming from 50 years of nuclear 
research and weapons production during the cold war, the Office of 
Environmental Management (EM) continues to focus its resources on those 
activities that will yield the greatest risk reductions, with safety as 
the utmost priority. To achieve a balance of risk reduction and 
environmental cleanup, the fiscal year 2010 request of $5.8 billion, a 
decrease of 3 percent from fiscal year 2009, builds upon the $6 billion 
in Recovery Act funding. These investments are already having an 
impact. Fifty skilled new workers recently reported to work at the 
Savannah River Site.
    This request supports the following activities, in priority order:
  --Essential activities to maintain a safe and secure posture in the 
        EM complex
  --Radioactive tank waste stabilization, treatment, and disposal
  --Spent nuclear fuel storage, receipt and disposition
  --Special nuclear material consolidation, processing, and disposition
  --High priority groundwater remediation
  --Transuranic and mixed/low level waste disposition
  --Soil and groundwater remediation
  --Excess facilities deactivation & decommissioning
    In developing the fiscal year 2010 budget for its environmental 
cleanup efforts, the Department will focus on achieving the greatest 
risk reduction, while also incorporating regulatory compliance 
commitments and best business practices, to maximize cleanup progress. 
In fiscal year 2010, EM is aggressively pursuing the consolidation and 
disposition of surplus plutonium and other special nuclear materials to 
enhance national security and to minimize the storage risks and costs 
associated with these materials. In addition, EM continues to make 
significant progress on the construction and operation of waste 
treatment and immobilization facilities across the complex. The budget 
continues shipments of remote-handled transuranic waste to the Waste 
Isolation Pilot Plant.
    The fiscal year 2010 budget request for EM funds the following 
activities:
  --Non-Defense Environmental Management ($238 million)
  --Defense Environmental Management ($5.5 billion)
  --UED&D Fund ($559 million)

Yucca Mountain
    The fiscal year 2010 budget request of $197 million for OCRWM 
implements the administration's decision to terminate the Yucca 
Mountain program while developing nuclear waste disposal alternatives. 
All funding for development of the Yucca Mountain facility would be 
eliminated, such as further land acquisition, transportation access, 
and additional engineering. The budget request includes the minimal 
funding needed to explore alternatives for nuclear waste disposal 
through OCRWM and to continue participation in the Nuclear Regulatory 
Commission (NRC) license application process, consistent with the 
provisions of the Nuclear Waste Policy Act. 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. The panel will 
provide the opportunity for a meaningful dialogue on how best to 
address this challenging issue and will provide recommendations for 
managing and disposing of spent nuclear fuel and high-level radioactive 
waste.

               IMPROVING THE MANAGEMENT OF THE DEPARTMENT

    As Secretary, I am making a concerted effort to improve management 
throughout the Department. The Department is committed to strengthening 
its management to implement the $26.4 billion fiscal year 2010 request 
and $38.7 billion of Recovery Act funds. The Department has developed 
strong oversight strategies for Recovery Act implementation, including 
upfront risk assessments and building specific risk management plans, 
upgrading process controls, establishing personal risk assurance 
accountabilities, and expanding outreach, training, and coordination 
between Headquarters and field offices. The Recovery Act, however, is 
only one aspect of a much larger effort to improve the Department's 
management.
    As part of President Obama's commitment to fiscal discipline, DOE 
will focus on using its resources responsibly, transparently, and 
effectively by identifying potential savings throughout the agency. The 
fiscal year 2010 budget request of $182.3 million for Departmental 
Administration, along with resources in individual program offices, 
will continue the improvement in key functional areas such as human, 
financial, project, and information technology management. These 
efforts will instill management excellence and encourage the most 
efficient use of the Department's resources.
    The Office of the Chief Information Officer (CIO) will receive 
$104.5 million, $33.4 million of which will go to cybersecurity and 
secure communications, $9.4 million to the corporate management 
information program, and $23.6 million for energy information 
technology services.
    The Office of the Chief Financial Officer will continue its effort 
in fiscal year 2010 to build and improve its integrated business 
management system, iMANAGE, with the deployment of budget execution and 
formulation modules such as iBUDGET. To accomplish this and other 
goals, the CFO's office will receive $66 million in the fiscal year 
2010 budget. A significant portion of the increase is to assume costs 
previously carried by the CIO for accounting systems operations.
    The Office of Management ($88.4 million) and the Office of Human 
Capital Management ($29.5 million) will help ensure effective and 
efficient management principles permeate from top to bottom at the 
Department of Energy. The Department has been making steady progress in 
improving project management and developed an action plan with concrete 
steps and scheduled milestones to successfully address the root causes 
of the major challenges to planning and managing Department projects. 
The action plan identifies eight measures that, when fulfilled, will 
result in significant, measurable, and sustainable improvements in the 
Department's contract and project management performance and culture. 
Primary actions include: strengthened front-end planning, optimized 
staffing, improved risk management, better alignment of funding 
profiles and cost baselines, strengthened cost estimating capability, 
improved acquisition strategies and plans, improved oversight, and 
stricter adherence to project management requirements.
    The Department's human capital management efforts are focused on an 
integrated approach that ensures human capital programs and policies 
are linked to the Department's missions, strategies, and strategic 
goals, while providing for continuous improvement in efficiency and 
effectiveness. The Department is revising its human capital management 
strategic plan to address future organizational needs, workforce size, 
skill gaps, performance management systems and diversity. To accomplish 
this goal, the Department will continue to implement strategies to 
attract, motivate and retain a highly skilled and diverse workforce to 
meet the future needs of the Nation in such vital areas as scientific 
discovery and innovation.

                               CONCLUSION

    It is my firm belief that the short-term impact of the Recovery Act 
combined with the new approaches and long-term vision in President 
Obama's fiscal year 2010 budget, will lay the groundwork necessary for 
creating the new green economy. Both President Obama and I look forward 
to working with the 111th Congress to make this vision a reality.
    I appreciate the opportunity to appear before you to present the 
fiscal year 2010 budget proposal for the Department of Energy. I will 
be happy to take any questions that the chairman and members of the 
subcommittee may have at this time.

                          FUNDING ALLOCATIONS

    Senator Dorgan. Mr. Secretary, thank you very much for your 
testimony. I have a good many questions, so I will begin with 
the first few questions, and then my colleagues will ask 
questions, and I will be able to stay and ask remaining 
questions.
    Let me ask you about coal. I asked during, I believe it was 
your confirmation hearing, about the statement, ``Coal is my 
worst nightmare,'' that you made, and you described the context 
of that statement, and I understand it.
    This budget essentially flat funds coal research and 
development. The fact is, coal is our most abundant resource by 
far, not even close. If it's our most abundant resource--and I 
and many others believe and I would hope you believe that we 
can continue to use coal, because we can use science, research, 
and technology to decarbonize coal--then how do we get there if 
we flat fund research and development with respect to coal?
    So can you give me a little bit of the philosophy that led 
to a flat funding for that account? Given what the President 
said about the substantial front-end investments for these 
kinds of things, I would have expected a very substantial 
recommended increase, in order for us to use coal in our 
future, because it's our most abundant resource.
    Secretary Chu. Well, Mr. Chairman, I agree with you, and I 
have to say that this budget reflects that because it has 
folded in the fact that we have received $3.4 billion, 
substantial funds, in the American Recovery and Reinvestment 
Act. Many of the pilot programs for that money, $3.4 billion 
that might have been funded in this section now have gone over 
to that.
    So in a certain sense, that incredibly large amount of 
funding for these pilot programs and the investigations are 
then, say, ``well, we will continue this current budget'', 
certainly if it were not for the Recovery Act funds, you would 
have seen a different budget.
    So even though I know the philosophy of the Recovery Act 
was to be seen as strictly supplemental, in the context of that 
addition, I think it's reasonable.
    Senator Dorgan. Well, that was the philosophy, actually. 
But I think most of the stimulus funding is considered to be 
demonstration projects rather than R&D. In the area of solar, 
which I support, and some other areas, even though there was 
substantial money in the stimulus, there's also substantial 
money in R&D, but coal is flat funded.
    Quickly, do you believe that we will have to continue to 
use coal in our future and need to find ways to decarbonize 
coal?
    Secretary Chu. Yes.

                                HYDROGEN

    Senator Dorgan. Okay. Well, we'll talk more about that. Let 
me ask you about hydrogen. You have essentially zeroed out the 
hydrogen program. You've moved a portion of it into a different 
direction, but there are about 190 ongoing hydrogen projects 
that are unfunded.
    We've got about 500 jobs, 140 at universities, 150 at 
national laboratories, 235 in industry, that have been working 
on hydrogen. And I agree that hydrogen is not near term. But I 
also agree if someone is going to look at things that are not 
near term, but are essential in the longer term, who but the 
Department of Energy should do that?
    I'm stunned that the budget essentially just moves away 
from hydrogen fuel cell research and stops projects in the 
middle of these projects. I don't understand just deciding to 
take projects that are half completed and say, ``You know what? 
We've decided that we're not going to do those projects 
anymore.'' I'm a big fan of hydrogen in fuel cells, and I 
believe that they are going to be part of our future. I agree 
it's not near term, but I agree also that the Energy Department 
has a significant role in continuing this research, your 
response?
    Secretary Chu. Well, this was a tough call. I think it was 
centered mostly on saying that hydrogen for vehicles is not 
near term, and that we wanted to prioritize to be investing 
more in things like advanced batteries, something that I could 
see in the next 10, 15 years could actually be adopted on a 
significant mass-deployment scale.
    Hydrogen stationary fuel cells I think we will continue 
funding. There are real issues that I have with transportation 
vehicles. The most problematic, in my opinion, is we still have 
not figured out how to store hydrogen in a compact form. So 
while we can be funding more basic research and looking for 
ways to do that, that is something of real significance.
    The other is the infrastructure. We would have to create a 
totally new infrastructure in order to have the hydrogen 
vehicles be fueled. Not insignificant is the fact that the 
hydrogen, if we were to deploy this within the next 10 years, 
would come out of reforming natural gas, and it's a 
questionable call as to whether we want to be using the 
reforming of natural gas.
    And so there are many issues. At a more basic research 
level, I think there have been advances in fuel cells, and we 
want to push on more radical approaches to these things. But I 
think stationary hydrogen is going to be, in my opinion, the 
first application.
    Senator Dorgan. Well, in North Dakota, we're actually using 
wind power to produce hydrogen from water, separating hydrogen 
from--well, at any rate, my point is that I think the 
Department's made a significant mistake here. And I, for one, 
am not interested in shutting down these research projects, and 
I'm going to do everything we can to continue them.
    We're only looking at near term, the next 5 to 15 years, 
but when you come around talking about cap and trade and 
climate change, you're going to talk about 2040 and 2060, 2070. 
So I really think this is an important area of research.
    President Bush, Senator Bennett, myself, so many others 
have been very involved in this, and to see these contracts 
shut down in the middle of the contract on very important 
research, I think is not a smart thing to do. So we'll have 
more to discuss about that.

                         BLUE RIBBON COMMISSION

    Quickly, what is the status of the development of the 
Nuclear Waste Blue Ribbon Commission? You recommend shutting 
down Yucca Mountain as a storage site. So the question is 
what's the development of the Commission, the status? What's 
your evaluation of what the Energy Committee is doing? In the 
energy authorizing committee, we have proposed something of 
that sort. Are you considering recycling spent nuclear fuel to 
reduce the volume? So give us your thoughts about what is 
behind shutting down Yucca Mountain.
    Secretary Chu. There's a first draft of names that are 
beginning to be circulated among the White House personnel 
people. We will be circulating them among Congress also for 
comment. The authorization committees, Chairman Bingaman and 
his committee, is I think--we're essentially in sync, in terms 
of trying to develop a very measured, intelligent, deep group 
of people that can actually step back and say that there are 
options available to us today, and looking down in our crystal 
ball and tea leaves 50 years from now, 20, 50 years from now, 
we can see other options.
    So now is a good opportunity to say--to charge the 
committee. There are options. I personally feel that if we do 
it right, we can develop ways of processing nuclear fuel to 
recover much more of the inherent energy value of that stuff, 
perhaps--through recycling, but we need to develop processes 
that are economically viable and proliferation resistant.
    So if that's true, and I think there's a reasonably good 
chance we can do this in the coming decades, then we would want 
to have two different types of storage--an interim type of 
storage, where you can then either get back the access, 
reprocess the fuel. We also want to be investing in types of 
reactors that can help burn down this fuel, and especially 
the--waste, so we can greatly reduce the waste.
    Now, having--after you've done all that, then there comes a 
point where you say you might not want to have access to, after 
you've burned down a considerable amount of the energy value. 
So then a permanent disposition might be called for. But these 
are things that the Blue Ribbon Panel should be discussing. And 
it's the hope that with their advice to both the administration 
and the Congress, we can formulate a path forward that I think 
could be much better than the one we're currently on.
    Senator Dorgan. I'm going to reserve the remainder of my 
questions until the end. Senator Bennett?

                             NUCLEAR POWER

    Senator Bennett. Thank you, Mr. Chairman. Mr. Secretary, 
let's continue this conversation about nuclear power. You've 
testified several times, and again today, in your support of 
nuclear power. And I'm delighted with that, because I'm a 
strong proponent myself. The budget fails to demonstrate any 
urgency, in my view, particularly deploying state-of-the-art 
reactor technology. And the rest of the world is investing in 
new reactors. Russia, France, India, all beginning to line up 
countries to sell their reactor technologies.
    Now, the United States is clearly the leader in terms of 
safety. There have never been lives lost. There's never been a 
problem with the American reactors. So that raises the question 
of why we are not the export leader in this business, but these 
other countries are.
    So would you be willing to support additional funding for 
the NP2010 program if it improved U.S. export competitiveness 
and accelerated the deployment of new reactors domestically? 
That would, I believe, create thousands of new jobs in the 
United States. Is that something that you could be supportive 
of, if this subcommittee moved in that direction?
    Secretary Chu. Well, in terms of NP2010, there were two 
reactors that we initially were supporting, the AP1000, the 
Westinghouse reactor, and the GE reactor. It is my 
understanding that the orders for the GE reactor have shifted, 
and it's not clear. And so while that reactor is still going 
forward in a much different pace--and so a decision was made 
until we get strong signs from General Electric that they were 
going to go ahead and push this because of the recession, 
because of a shifting of orders, for example, from the GE 
reactor to the Westinghouse reactor, the support of the 
licensing of that reactor didn't seem to be as high a priority.
    So I do want very much to restart the nuclear industry. 
We're in a final review of a number of proposals for the loan 
guarantees. And so that's something that has a very high 
priority with me. This specific reactor, the GE reactor, and 
the extension of 2010 will really depend, in large part, on 
what General Electric--how aggressively they want to move 
forward on it as well.

                            LOAN GUARANTEES

    Senator Bennett. I see. Let's talk about the loan 
guarantees for a minute. In the bill that left the Senate, 
there was a very hefty increase in loan guarantees. It did not 
survive with the conversations in the conference. Those of us--
well, I won't say those--I was subjected to some fairly heavy 
criticism on the part of people who said, ``Well, the loan 
guarantees should not include nuclear. The loan guarantees 
should be entirely for wind and solar and that sort of thing, 
and you shouldn't include nuclear in there.''
    The Department's issued five solicitations under the Loan 
Guarantee Program, and in four of the five, demand vastly 
exceeded the available supply. Now, would you be open to having 
the Congress change the law so that you could shift from one 
pattern to the other, if there's one that's undersubscribed, 
and make that money available to others? And do you still 
support the idea that under the loan guarantees, nuclear has to 
be included as renewable, in the sense that we are defining as 
renewable something that is not emitting carbon?
    Secretary Chu. I absolutely support the idea that within 
the loan guarantees, restarting the nuclear industry should be 
supported. Right now, the $18.5 billion can probably help start 
three of their four applications. We're looking as to whether 
there can be some cost-sharing with non-Federal loan guarantees 
from abroad in order to fund four. I think that's a start. I 
personally would like to see a bigger start.
    Senator Bennett. Well, the request for $93 billion for the 
$18.5, so there's obviously a great deal of interest in it. And 
my concern is that if you have other areas under loan 
guarantees where the requests are below the amount available, 
that you be given the authority to shift money from that and 
make it available to nuclear. Is that something you would be 
supportive of?
    Secretary Chu. I think in general, philosophically, 
absolutely yes. But I think to balance that, there is a fear, 
because the cost of nuclear is so high, that there is a fear 
that if you were allowed to shift the money, that it could 
easily gobble up a lot of the things of the lower cost 
renewable energy projects. So there should be a balance there, 
but having the flexibility to make those decisions, I would 
welcome.
    Senator Bennett. Okay, one last question. We've talked 
about the stimulus package and the amount of money that's 
available. Can you give us a path as to how quickly some of 
this money can be moved out? It has not moved as rapidly as 
many people thought that it should. And are those people just--
their expectations are too high, and you're moving the best you 
can? Or have you run into problems? Or is there a holdup where 
we can be helpful? Can you give us the timeline? Just give us 
an overall view of what's happening with all of the money that 
got appropriated to----
    Secretary Chu. I think the progress in the loan guarantees 
has been actually very good since when the new administration 
took over. When I took over initially, I was told that the 
first loan, which was authorized by----
    Senator Bennett. Not just loan guarantees, but generally, 
the President--you have $38.7 billion appropriated, and you 
spent 1 percent of that.
    Secretary Chu. Okay. That's right. So in many of the 
programs we're doing, we're on target. We have a schedule that 
we want to have allocated 70 percent of that Recovery Act money 
by Labor Day. There's an issue here because in many of the 
things that we do, we request for proposals. We have to review 
the proposals, and then we have to make decisions.
    So in order to do this, there's going to be a massive 
review this summer of many of those programs. So we've gotten 
clearance from OMB, apportionment of many of these things. And 
so the allocations, we hope a lot of them can be made by this 
Labor Day. So, so far, there has been $4 billion obligated to 
date, about 10 percent.
    Senator Bennett. About 10 percent. Okay. So, Labor Day is 
an updated timeline when you will have, what, 70 percent of it 
spent?
    Secretary Chu. Well, by spent, what we're saying----
    Senator Bennett. Or obligated?
    Secretary Chu. Yes, we're trying to get to that obligation 
period by that time. That's correct.
    Senator Bennett. By Labor Day. And are there any accounts 
that you see that might, in fact, lower the amount you'll have 
to spend in fiscal year 2010 as a result of the normal 
appropriations?
    Secretary Chu. Sorry, I didn't quite get the question.
    Senator Bennett. If you have the backup of stimulus funds 
that you've been unable to spend and then those get spent 
during fiscal year 2010, does that mean there is any fiscal 
year 2010 money that can, in fact, be delayed until fiscal year 
2011 because you simply can't physically spend it?
    Secretary Chu. Right. Well, we're going to be trying to do 
our best to satisfy the statutes of that Economic Recovery, 
which is really to have it essentially obligated--100 percent 
of it obligated by 2010, and a large fraction of it spent. But 
as you know, there--in some of these things that we're doing, 
in order to lay the foundation for a new energy economy, it's 
not as though it's money instantly into supplemental check----

                             RECOVERY FUNDS

    Senator Bennett. Oh, I understand that. But you understand 
the angst that is out there among our constituents about the 
amount of money in total the Federal Government is spending and 
the concern that it may not be spent wisely. And if, as you 
move forward in your pattern to say, ``Okay, this is the proper 
timetable and the proper method of spending stimulus funds,'' 
and you discover that in doing that, it means that you do not 
need as much of the 2010, in terms of--speaking in business 
terms now--actual cash flow. I'm not talking about changing 
your plans or changing your research programs or your targets 
or something.
    But there becomes a physical question of pushing the money 
out the door. And in terms of actual cash flow in 2010, you 
can't prudently do it----
    Secretary Chu. Right.
    Senator Bennett. Would you share with the subcommittee 
those funds that might be pushed onto 2011?
    Secretary Chu. Yes, I could share those concerns. But we 
are looking at novel ways of addressing this. It is a--you're 
quite right to say that this is a Herculean task. It more than 
effectively doubles our budget. And so, for example, I have 
sent a letter out to all the presidents of the major research 
universities, the relevant deans, the presidents, and the 
executive chairs of all the relevant professional societies, to 
say that we're going to have essentially a review-fest over a 
period of one week in Washington, asking them to nominate for 
this summer their best people to help us review these 
proposals. We cannot do this alone with our current staff. And 
so we're looking at things like that in order to get this 
moving.
    Senator Bennett. Okay. Thank you very much.
    Senator Dorgan. Senator Bennett, thank you very much. I 
have just been called by Senator Reed, the majority leader, to 
go to the floor to negotiate an amendment that they're trying 
to clear before they do final on this, in the bill that's now 
pending. So I've asked Senator Murray to chair while I'm gone. 
And let me call on Senator Alexander. We're recognizing 
Senators in order of appearance at the hearing.

                            INNOVATION HUBS

    Senator Alexander. Thank you very much, Mr. Chairman. Mr. 
Secretary, welcome. On May 9, 2008, I made an address at Oak 
Ridge Laboratory about a new Manhattan project for clean energy 
independence, seven grand challenges for the next 5 years: 
plug-in cars and trucks, carbon capture, solar power, nuclear 
waste, advanced biofuels, green buildings, and fusion. So I 
like your hubs. I think that's exactly the way to go about 
these grand challenges.
    I have a question about a relatively small item. In the 
America Competes Act, which you had a role in developing the 
recommendations for, there is a provision for distinguished 
scientists who would have one foot at a university and one foot 
at a national laboratory. It's worked well at Oak Ridge, for 
example, with the University of Tennessee over the last 20 
years.
    There's authorization for up to 100, was the idea, to be 
phased in over a period of time, and there's the authorization 
for $30 million of spending, none of which is funded yet in 
this budget. I just want to call that to your attention in case 
it does get funded to suggest that moving ahead with those at 
the rate of four or five a year might be one way to advance 
these hubs, as you're looking to attract very talented people 
to focus their attention on those. Have you noticed this?
    Secretary Chu. Actually, first, let me just say I support 
the idea. I think having intimate collaborations from 
universities and national labs is something I'm very supportive 
of. I would be encouraging--although one doesn't see it 
specifically in a line item of a budget, one is beginning to 
see this in the national labs, and I would be encouraging the 
national labs to grow much stronger relationships with 
surrounding universities. It serves both the university and the 
national labs very well. It brings in a lot of young blood. It 
creates a churn and intellectual excitement.
    So while it doesn't have to necessarily show up in a line 
item, I will be encouraging all the national labs to do just 
that within their programs.
    Senator Alexander. And this authority isn't earmarked to a 
particular university; it's for the Secretary to compete and do 
it in whatever way is right. I would like to explore the 
questions that Senator Dorgan and Senator Bennett raised about 
nuclear power.
    The President, in his inaugural address, talked about power 
from the earth, the wind, and the sun, and that's captured the 
imagination of a lot of people. But it's less than 1\1/2\ 
percent of our electricity today, and if we double it or triple 
it, we still don't have much. And even if we reach the 15 or 20 
percent that some people think we might of renewable power, 
that's probably it, and that still leaves a need for 80 or 85 
baseload power.
    I thought the President's rumored proposal today of capping 
greenhouse gases from tailpipes by a low-carbon fuel standard 
was a good idea. I think that it makes sense because that will 
encourage switching to an existing technology, such as electric 
cars. We have enough--we could plug in, Brookings says, half 
our cars and trucks, without building one new power plant, if 
we do it at night, we have so much unused capacity.
    If we look back at the beginning of the cap-and-trade 
program in 1990 and 1991, we had an existing technology then 
for dealing with the acid rain. We had scrubbers that would 
take care of that. Where I'm going is, as we move along in the 
greenhouse gas discussion, we probably get next to coal plants, 
which are 40 percent of the carbon. And we don't have an 
existing technology to deal with that, except nuclear power, 
and with a limited amount of experience with burying carbon 
underground.
    So why wouldn't we be as aggressive about expanding nuclear 
power and doubling or tripling research in Manhattan project to 
find a way to get rid of the carbon in existing coal plants as 
we are with wind and solar and other so-called renewable 
powers? They're not baseload powers. And isn't it true we have 
to have some new source of clean baseload power? Why not just 
put a plan in to build 100 new nuclear powerplants in the next 
20 years as a start toward that and double or triple research 
to take carbon from existing coal plants?
    Secretary Chu. Well, as enthusiastic as I am about nuclear 
power, that number, 100, would be a lot. It would be a huge 
challenge to our nuclear industry. I think I've repeatedly gone 
on record as saying, as you well know, that this 
administration, this Department, the hopefully soon-to-be 
confirmed members of my team are all enthusiastic about it. 
They say it is a necessary part of our baseload power.
    I agree with you, if you're going to go above 15, 20, 25 
percent renewables, there are real issues having to do with the 
transmission and distribution system, having to do with 
storage. The storage problem is especially an unsolved problem, 
but there are options, and so we'll be looking at, for example, 
pumped hydro, where it's appropriate in certain regions.
    But I reiterate the fact that we're blessed with a lot of 
coal, and although we do not have today the technologies that 
would make capture and sequestration of coal economically 
competitive, I think there's a good chance that we can get 
there. And so I'd prefer to take a different stand and say 
let's push all of these things as hard as we can.
    The nuclear industry, if you look at the capacity of their 
ability to build reactors, it's not there today, and so while 
we want to move aggressively ahead on that, I think we still 
have to try to move aggressively as we can on developing the 
technologies for capture and sequestration.
    Senator Murray [presiding]. Thank you, Senator Alexander.
    Senator Alexander. Thank you, Madam Chairman.
    Senator Murray. We'll move to Senator Tester.

                         LOAN GUARANTEE PROGRAM

    Senator Tester. Yes, thank you, Madam Chair, and thank you 
for being here, Secretary Chu. A couple of things, going back 
to some previous questions, I certainly appreciate the 
situation you're in and that there is a sizable sum of money 
available to you to send out. But I also appreciate the fact 
that you're taking the time to make sure we get the results 
from this. It's just not money spent for the sake of spending 
money. And I think there's a real urgency in generation and 
transmission in this country, as the questions before me have 
pointed out.
    I want to go back a little bit to the Loan Guarantee 
Program. You talked about a massive review--I don't know if it 
was of that program or not. But just can you tell me where we 
are as far as the decisionmaking process of that Loan Guarantee 
Program, and what is the timeframe for getting some of the loan 
guarantees out the door?
    Secretary Chu. Okay, so we've made a provisional grant to 
one company. That means that they have to find funding for the 
current statute for the 20 percent. This is middle May. I think 
by the end of this month, we'll be announcing a number of 
others. We've greatly accelerated all the review processes and 
how we do it, and we're doing many things in parallel now, 
something that the Department is not used to.
    And so the loan guarantees essentially are being 
accelerated by about a factor of 5, maybe closer to 10. So this 
is a very significant focus on making sure that these things 
are reviewed, reviewed adequately, but very quickly.
    Senator Tester. Okay. So you're anticipating some 
announcements--because we are in the middle of May----
    Secretary Chu. Right.
    Senator Tester [continuing]. Any day?
    Secretary Chu. Certainly within the next couple weeks to a 
month, yes.

                              WIND ENERGY

    Senator Tester. Okay, all right. We have great wind 
resources, particularly in the eastern part of Montana. And 
what has traditionally happened over the last 4 or 5 years is 
they've built a lot of towers in a fairly small area for 
purposes of maintenance and construction, cranes, all that 
stuff. It looks to me like the best benefit you can get out of 
wind is if you decentralize it, if you move it around for 
intermittency purposes. The wind's blowing somewhere in eastern 
Montana every day, all the time, and the issue is the grid.
    Do you ever put forth policies or put forth direction to 
electrical generation companies to encourage them, or is there 
anything we can do to encourage that, or is that even a good 
idea? I'm talking about decentralization of wind to reduce 
intermittency and reduce the need for--go ahead.
    Secretary Chu. No, that is a very good idea. In fact, a 
number of Cabinet-level people have been meeting on an every-
other-week basis. The principals--meet--this is Interior, Ag, 
Energy, CEQ, a number of stakeholders--to try to develop a 
coherent plan where the energy resources, both solar and wind, 
where are the places where it would not be--we have to be very 
sensitive to environmental concern and danger species, things 
like that, and trying to now develop this--FERC is also, of 
course, part of this. And we're trying to then develop this and 
start to work with the private sector.
    Senator Tester. So you have the ability to give some 
direction?
    Secretary Chu. Well, we're----
    Senator Tester. Or we need to do it at this level?
    Secretary Chu. Well, we are trying to develop some plan 
that gets buy-in from the private sector.
    Senator Tester. Okay. That's the best.
    Secretary Chu. The meetings have been going on for several 
months.

                      CO2 SEQUESTRATION

    Senator Tester. A few weeks ago, this subcommittee had a 
hearing on beneficial use of CO2. We heard some 
pretty encouraging things about algae. One that was 
particularly encouraging to me was cement, making cement, not 
having to separate the flue gas. It sounded to me like it was 
tricked out and ready to go.
    Two questions, No. 1, is that kind of specialty use of 
CO2 something that you see as viable and is it 
something that can happen? And then the follow-up question is, 
is the beneficial reuse of CO2, is it being limited 
by our study of carbon sequestration and storage?
    Secretary Chu. We are certainly looking into those things--
the algae converted CO2 into lipids that can be used 
for transportation fuel and cement. The verdict is not in 
whether these processes work but if they could go to a scale 
necessary to be significant, and so we're looking very hard 
into this. I do know other countries also are looking into--for 
example, I just had a discussion with some representatives of 
China. They're keen on seeing whether this can actually work.
    But again, we're in the process of trying to study whether 
it can really go to scale or whether it will be a small, more 
boutique type of thing. Cement especially is something that 
goes in several stages. There are various grades of cement and 
long before you can actually get into a structural cement there 
are many issues having to do with structural integrity. The 
economic viability is something--it's--but these are fairly new 
ideas, and so we are very interested in looking and seeing if 
they can really work.
    Senator Tester. Do you think the budget's adequate enough 
to deal with the CO2 issue, generally speaking, both 
as beneficial use and as storage? Is this an adequate budget to 
deal with that?
    Secretary Chu. I believe it is. I think we're upping, 
actually, the funding in algae, and cement, there are a couple 
of companies looking at this, in terms of supporting that with 
loan guarantees.
    Senator Murray. Thank you, Senator Tester. Senator 
Feinstein.

                           DESERT PROTECTION

    Senator Feinstein. Thank you very much, Madam Chairman. 
Good morning, Secretary. It's good to see you here. I've tried 
to obtain an appointment with you. So far, I've not been able, 
so I'm going to take this opportunity to express a concern 
publicly that I would have expressed privately, had I had the 
opportunity.
    You may not know this, but I authored the Desert Protection 
Act in southern California. We created two new national parks, 
Joshua Tree and Death Valley, and the Mojave Preserve. Since 
that time, for about the past 7 years, we've been trying to buy 
railroad inholdings to put them into conservation and have in 
effect bought about 700,000 acres in a very unique public-
private partnership. The private sectors contributed $40 
million, and we, about $17 million, to be able to do that.
    So it was much to my consternation that I was suddenly told 
that a lot of large solar facilities were going on the land 
that we had just purchased with a lot of private money to 
conserve. So I went down to the desert and brought the 
companies involved and took a look.
    And here's what I found, that I saw seven projects. They 
totaled nearly 60 square miles, 60 square miles. One was 9.3 
square miles. One was 7.03 square miles. One, 15 miles square, 
that's BrightSource, Iberdrola, 3.09, the second Iberdrola, 
another 3.09, PG&E, 6.56, and Solal, 6.25, and many of them in 
this land that is due for conservation and that had been 
purchased for the purpose of conservation.
    Then I began to look, and I talked to Southern California 
Edison, ``What's your largest solar project?'' 50 megawatts. 
And I see here, we've got 914, 815 megawatts, 500, 500, 500, 
800, 600, huge projects. And I asked how was this done? Well, 
the national topography of the land is leveled out. The sand is 
removed. A gravel surface is put in. The solar troughs are 
centered. You need a large steam plant, and you need very large 
transmission lines.
    The question comes, for me, having tried very hard over 16 
years to protect this area of the desert, now to see it all in 
the main going for a huge number--now, I'm only talking about 7 
out of 65 projects for the area. Those were the only ones I 
saw. But the ones I saw were 60 square miles' worth of solar 
troughs, huge steam plants and fences that will go around it. 
Right in the middle of a desert where the desert tortoise has 
some habitat, where there are other problems--bighorn sheep, 
Indian petroglyphs, and so on--and we've been able to clean up 
this desert over time.
    The question I have is should we not cap the size of these 
things? The largest that I know of is in Kramer Junction. Two 
projects, one 160 megawatts and one 150. Each one is about 2 
square miles. Those are the largest I know of anywhere in the 
United States. And now we're talking about one of 15 square 
miles. Should we not cap the size of these?
    Secretary Chu. Well, I certainly would be willing to--
first, I'm a little bit surprised if you asked to see me and my 
staff said no.
    Senator Feinstein. Well, we just haven't gotten a response. 
That's sort of the way it's done. You just don't hear.
    Secretary Chu. Oh.
    Senator Feinstein. But anyway.
    Secretary Chu. I'm still surprised. You actually have my 
private number.
    Senator Feinstein. Well, I should call you at home, then.
    Secretary Chu. But I'd certainly be willing to talk to you 
about this. These are sensitive issues and we have to think 
hard about them. I don't know--I was actually just informed 
only a few days ago about this concern and I'd certainly be 
willing to look into it.
    I think this is one of those very delicate issues, as I was 
saying to Senator Tester, as we are developing a plan moving 
forward in conjunction with the other Secretaries, one of the 
issues is the sensitivity to habitats of endangered species 
that we're looking at, and we're trying to make sure that we 
fold all those concerns into where there would be good sites 
for solar and wind.
    Senator Feinstein. My time is up. Let me say one more 
thing. In my State, I have 47,000 abandoned mines. People came 
in, they mined, they took the stuff they wanted and they walked 
away from the mines. Solar technology is going to change. In 
Daggett, I've looked at some photovoltaics and solar troughs. 
They walked away from them. They left the steam engine there, 
steam plant there. This has to be considered as well.
    Everything right now is how you can do it the cheapest 
possible way you can. Huge is better. But I've got to tell you, 
I'm going to fight for this land to be protected. And I think 
that size is a factor, and you just can't come in and build 15 
miles square facilities with huge steam plants. We're willing 
to do our share. I am. I understand the desert is a good place 
for it. But the sky's not the limit, Mr. Secretary, and that's 
what I want to say. Thank you, Madam Chairman.

                             WASTE CLEANUP

    Senator Murray. Thank you, Senator Feinstein. Mr. 
Secretary, thank you. You and I have spoken on several 
occasions about the legal and moral obligation for the Federal 
Government to clean up the waste that was left behind from 
World War II and the cold war. We've talked about it prior to 
your confirmation, at the Budget Committee hearing, and again 
after the release of the 2010 budget proposal.
    My position is really clear, and the administration is 
going to have to expect it to remain consistent, because that's 
what I want for these budgets. I want budgets that clearly meet 
the obligations we have to the Nation and the States and the 
communities that are home to those cleanup sites. And I want 
budgets that consistently make progress toward the goal of 
cleaning up that waste.
    The funding highs and lows that we see just don't get us 
there, and unfortunately, that's what I see in the EM budget 
we've been presented with. Let me talk about the highs. In the 
Office of River Protection, it's good to see an increase for 
the work at the tank farm. We have seen years and years of 
pushing off those infrastructure needs, and there's a lot of 
work that needs to be done there. You're putting your focus 
back on that work, and I do appreciate that. I expect that we 
can remain consistent, and we'll look forward to that as the 
new base level of funding for those tanks. That's really 
important.
    However, the same effort isn't evident with Richland 
Operations, where there's a reduction in funding below the 
fiscal year 2009 and fiscal year 2008 appropriated amounts. 
That reduction does not represent a consistent effort for 
stable and compliant budgets. We all have to remember that the 
economic recovery funds were meant to make up for lost time and 
to create good-paying jobs, not to make amends for this year.
    The River Corridor Closure Project is up; however, the 
Central Plateau is down. Reducing the active cleanup footprint 
at the site is a really large task that requires consistent 
budgets to fund the effort. So I encourage you to keep that in 
mind when you're planning for next year's budget so we don't 
get ourselves back into this position again.
    As you know, Hanford is not going to be cleaned up in 5 or 
10 years. It's a large project, massive in size, and we need to 
manage it thoughtfully and consistently with that long-term 
mission in mind. And that's why I am always saying we need 
stable and consistent budget, so we can get the job done 
safely, No. 1, and successfully.
    I also wanted to just quickly mention to you the Hammer 
Facility that is on site at Hanford. The Hammer Facility offers 
incredibly wonderful training for people who take on the very, 
very dangerous work of cleanup. And I'm hopeful that when you 
do come out to visit the Hanford site, that you'll get the 
opportunity to stop by and see Hammer, see what they're doing, 
to help promote a safe working environment at a very, very 
challenging place.
    I'm still looking forward to your visit at some point in 
the near future, where you can see progress on the site, but 
also, some of the worker safety training going on at Hammer and 
at PNNL and how everything works together towards cleanup.
    I do have a number of detailed questions for you on support 
for Hammer and the B reactor. I'll submit those for the record. 
But I do have a question for you while you're here, Mr. 
Secretary. I do want to say that I'm pleased at the overall 
increase for energy efficiency and renewable energy. We've got 
to move forward on a clean energy economy. And I think that 
does help us keep on the path.
    Now that you have spent some time at the Department, I'm 
looking forward to hearing an update on the Water Power 
Program. As you know, that program got $40 million in 2009, and 
the President is now requesting a 25 percent reduction, which I 
am very concerned about. I think we have to have a very strong 
continued investment in existing hydro facilities that will 
allow us to use those to supplement the more unpredictable 
sources, like wind or solar. And I think we have to increase 
our work to develop new marine and hydrokinetic technologies, 
as well, that you and I have talked about before.

                              WATER POWER

    So with my less than a minute left could you talk to me a 
little bit about your vision for the Water Power Program.
    Secretary Chu. I think, first, very briefly, I am very 
committed to continuing the cleanup as aggressively as we can 
and looking for better ways of doing that. It's not only the 
money, but it's also the way it's invested and funded. And so a 
lot of time is now being spent in reviewing how we deal with 
the contractors, making sure that they do the job in a timely 
manner.
    In terms of the water projects, it's too late to start this 
in 2010, but in the 2011 budget, I'm a big advocate for looking 
at ways of being, let me just say friendly to the fish, but 
allow us to continue hydropower, but also to look at the 
possibility of actually having some pumped hydro, small amounts 
of sources, so that we can actually couple the renewable energy 
better. And so we're going to be looking very hard at that.
    Senator Murray. Okay. I look forward to working with you on 
that. I think it's extremely important. And I appreciate your 
response. Senator Cochran.

                      STRATEGIC PETROLEUM RESERVE

    Senator Cochran. Mr. Secretary, welcome to the 
subcommittee. We thank you for your cooperation and your 
service as Secretary, a very important position. In the budget 
request for the Strategic Petroleum Reserve, roughly $50 
million is included and proposed for the purchase of a new 
cavern to replace an existing storage cavern that was said to 
pose an extreme environmental risk. And this is for storage of 
strategic petroleum reserve.
    There are salt domes in my State of Mississippi which some 
think are ideal sites for the storage of the petroleum reserve. 
Your Assistant Secretary recently testified about legislation 
to increase storage capacity, specifically for the strategic 
petroleum reserve.
    I'm curious to know what your thoughts are about choosing 
caverns that some say are not environmentally appropriate for 
storage, rather than looking into the possibility of salt domes 
that are coincidentally located in southern Mississippi. I'm 
just curious to know if this has reached your level for 
attention and consideration.
    Secretary Chu. Well, my understanding is that one cavern, 
which I believe is the salt cavern--it wasn't understood that 
the thickness of the salt was, in one section of it, thin 
enough that it could open up the possibility of a breach and 
can actually--the petroleum could leak into the environment.
    And so that was discovered, in my understanding, last year, 
year and a half. And so once it was discovered, it was decided 
that that posed an environmental risk and we should go out and 
purchase some property to put it in a place where the envelope, 
if you will, would be less likely to be breached. And so that's 
what we're in the process of doing, but salt caverns are 
actually used for that, as you well know.
    Senator Cochran. Right. Well, I was just curious to know 
whether that reached your level for your personal attention. I 
don't have any fixed views about which caverns are the best or 
not the best, but we certainly want to be sure that they are 
safe in terms of environmental consequences, and certainly in 
respect to possible damage to people who live in the area.
    Funding, incidentally for the strategic petroleum reserve 
included $35 million for a site near Richton, Mississippi, 
contingent on a report issued by the Department within 45 days. 
My staff has contacted the Department about the report, and 
we're just curious to know what the status of that report is, 
if you know.
    Secretary Chu. I don't know. I could get back to you on 
that and give you the details.
    Senator Cochran. We would appreciate that, and we would 
like to be kept in the loop, as long as you have active 
consideration of Mississippi sites. Or I know in Louisiana, 
they have some salt caverns there as well. But it's of 
importance. We want to be a positive contributor to the solving 
of our energy problems, and we think that there are some 
caverns that possibly could be suitable, and we'd like to 
know--there was a report, I think, contemplated at one time to 
describe and define this, so the general public would have some 
better ideas of what's going on. Rumors get started, and I 
would like to know what the facts are so I can pass that on to 
my constituents. If you could look into that, I would 
appreciate it very much.
    Secretary Chu. Sure, I'd be delighted to.
    Senator Cochran. Thank you. Thank you, Madam Chairman. 
Sorry, Mr. Chairman.

                               GEOTHERMAL

    Senator Tester. Oh, that's entirely all right. I'll ask a 
few questions here, waiting for Senator Reed to go here. Real 
quick, do you think that there's any future as far as 
geothermal goes in relation to baseload power, or is it 
economically not going to happen?
    Secretary Chu. I think there is a real potential, 
especially enhanced geothermal. But we're looking--geothermal 
right now is on .3 percent of our electricity generation 
capacity in the United States.
    Senator Tester. But we have incredible resource.
    Secretary Chu. We have incredible resource. It's mostly--my 
understanding, it's mostly in the ability to do enhanced 
geothermal, meaning that you pump in water or carbon dioxide 
that uses the heat transfer fluid. We know how to fracture rock 
much better than we did before, and so this is a possibility.
    We are going to be investing in research to see whether 
enhanced geothermal can actually be viable. If it is viable, 
there is a very large resource.
    Senator Tester. How many years out do you think it is, 
before the first viability?
    Secretary Chu. I'm trying to think of the briefing, but 
these things are issues where you're going to--it's, again, 
there's--it takes time to drill. It takes time to test it. Ten 
years. I don't know.
    Senator Tester. Okay. Senator Reed.

                       WIND AND GRID INVESTMENTS

    Senator Reed. Thank you very much. Mr. Secretary, thank you 
for joining us today. I know you are aware that my State of 
Rhode Island is aggressively trying to deploy wind-powered 
facilities off its coast in State waters near Block Island and 
in Federal waters further out. This is not only going to 
provide us with, we hope, renewable energy resources, but also 
provide a stimulus to our manufacturing sector, producing the 
blades to turbines and other equipment.
    One of the concerns we have is that the investments that 
you are leading in terms of the grid might focus the attention 
away from these projects along the east coast and more toward 
the center of the country. And I would just ask you to sort of 
ask us how these grid improvements can help and not hinder the 
development of these wind projects. And it's not just Rhode 
Island. It's Delaware. It's all up and down the--Virginia, all 
up and down the coast, this sector.
    Secretary Chu. Well, you're raising a very important point. 
The Atlantic Coast has a lot of wind resources, very close to 
population centers. And we are--certainly this is part of us, 
as we get out feet wet, so to speak, in finding out how to 
develop the wind resources.
    I think it's important to actually develop them in both 
places. The more diverse the set of wind resources, not only in 
Montana, but all over the United States, the better we have of 
actually becoming more base load. So to have wind resources off 
the shallow Atlantic Coast and having it in the Northern 
Midwest, they're very important.
    So in talking to power distribution companies, utility 
companies, it's not clear to them what the best economic 
investment is either. So we're trying to work through this. The 
issue with offshore is that for shallow offshore, it's about a 
factor of two more expensive initial investment. Even more so--
perhaps a factor of three or more--in the maintenance, and so 
far, the maintenance is higher than expected in the European 
experience. And so we are trying to work through all of these 
things. Hopefully within several years, we can get the wind 
turbines so that the gear boxes, the blades, are much more 
robust.
    But so these are all issues. Going offshore actually 
complicates that.
    Senator Reed. Yes, indeed. I think, though, that--and I 
don't want to suggest a response, but it seems that there 
should be a very explicit recognition of these offshore efforts 
and coordination as you invest in the grid. It would help 
either inadvertently or directly see huge investments, which 
make it even more difficult to bring this power----
    Secretary Chu. No, I agree with you. I think it should be a 
balanced view, and how to develop the renewable resources at 
large in the United States in the most balanced way. And in our 
little group of secretaries and other administrators, this is 
very much on the table, the balance between Atlantic offshore 
and Midwest, for example.
    Senator Reed. And principally FERC and the Department of 
the Interior will have the principal roles of the siting, et 
cetera. But I presume the Department of Energy will be an 
active participant, from your comments.
    Secretary Chu. Yes. But you said it correctly FERC and 
Interior will have the major roles in deciding.

                             WEATHERIZATION

    Senator Reed. Let me--I have at this time, one final topic. 
And that is thanks to the efforts of Chairman Dorgan 
particularly, there's been an unprecedented investment in 
weatherization in the Recovery Act. And then the 2009 
appropriations bill has $450 million to complement the roughly 
$5 billion in the Recovery Act. But the 2010 budget has only 
$220 million for weatherization. Now, I understand some of that 
is because of a big spike up, and you're coming down. But there 
is a concern that we're ramping up this capacity of 
weatherization. We're getting people out there, particularly in 
the context of recovery, those are good jobs, and then we're 
going to see the funding streams diminish rapidly, leaving us 
with capacity and people, but--and still with demand.
    So I wonder if you could just give us the notion of what's 
your long-term strategy for weatherization, Dr. Chu.
    Secretary Chu. Yes, Senator, you were actually raising a 
very good point. Because in the weatherization, roughly $10 
billion is, in the Recovery Act, spread around several 
agencies. Part of that is actually building a workforce that 
can weatherize, and after 2 years or 2\1/2\ years, what do you 
do with this workforce?
    So I think what we are very concerned about, in trying to 
design self-sustained programs beyond that. Let me give you one 
example. Secretary Donovan and I are looking for ways in which, 
when properties change hands, when you buy a home, that you can 
have financing, additional financing, say an extra $10,000, 
$15,000 that's part of your mortgage that, if done right, that 
financing could actually decrease the cost of running your 
house, because the money you save in lower utility bills will 
be more than compensative for the additional little bit of 
mortgage.
    Now, when you sell your property, it's--okay, the 
investments are there. And so that helps overcome the initial 
hurdle of capital that is very important. This weatherization 
could cost $10,000, $15,000 for middle-class homes. It also 
gets the middle class into this.
    We're also looking at programs where banks could be 
encouraged to again for the affordability of the house, ask 
that, in addition to a termite inspection, they ask for the 
utility bills from the gas and heat. And in that section of the 
country, this is the spread of utility bills per square foot 
for average house. So just like a refrigerator label, this is 
the spread--the home you're thinking of buying is here or here.
    This does--first, no taxpayer money. Very little 
transaction cost, but it motivates several things. You get a 
more informed consumer. You actually give incentive to the 
current homeowner to weatherize, to increase the resale value 
of the home. And you actually--then there's an incentive. It 
also helps the new home builders who are reluctant to put in 
energy efficiency. One can predict the energy efficiency of 
those new homes, and they look much better. And so you 
stimulate in many ways, just by the simple transaction that 
seems to me logical, in the sense that what a bank really cares 
about is the affordability of the home. It includes the taxes. 
It includes the mortgage rate. It includes the utility bills.
    So there are things like that we're looking to do--and 
revolving funds yet another one, so that we actually get this, 
1 million or 2 million homes is just the beginning. We need to 
get this self sustaining in a very deep way. So these are some 
of the programs we're thinking of piloting and testing.
    Senator Reed. Thanks very much, Mr. Secretary. Thank you, 
Mr. Chairman.
    Senator Tester. Thank you.

                          HYDROGEN FUEL CELLS

    Senator Dorgan [presiding]. Senator Reed, thank you very 
much. Mr. Secretary, again, I regret that I was called over to 
the Capitol, but I appreciate your answering the questions of 
my colleagues. Let me go back to the issue of hydrogen. I want 
to ask a number of questions then we will let you be on your 
way.
    The hydrogen fuel cell issue has been a part of the 
Department of Energy's portfolio for well over a decade now. In 
2006, the Department of Energy developed and released the 
hydrogen posture plan. It laid out a 15-year strategy for 
hydrogen and fuel cell research, development, demonstration, 
and deployment.
    Since about 2001, roughly $1.5 billion has been invested by 
the Federal Government in hydrogen and fuel cells, and industry 
and the States are estimated to have spent somewhere in excess 
of $4 billion. My understanding, from the experts who know, is 
that these programs have met their cost and their technical 
goals. Research has kept pace with key milestones established 
in the hydrogen posture plan.
    So, again, I don't understand. Let me be more specific. Do 
you come to us saying you want to shut down these research 
projects in the middle of the research? Is that what the budget 
is asking us to do?
    Secretary Chu. Well, it is a shifting of priorities. I 
would be very happy to talk to you about this and discuss this. 
But certainly it was more the intent of the 2000--the concern 
in the 2010 budget was focused more on the transportation 
sector and whether hydrogen cars could become a reality in 
let's say 20 years, and whether--or do we see it further out, 
and whether we should be investing these resources in, for 
example, much more efficient internal combustion engines, 
especially, from my point of view, diesels, since the new 
advances in diesels allow diesels to now meet California EPA 
standards. They're very clean diesels, and also the plug-in 
vehicles.
    And so in terms of offsetting our imports of foreign oils, 
getting some more oil independence, really getting these things 
in the marketplace, I see those as more likely solutions in the 
next 20 to 30 years.
    Senator Dorgan. I don't disagree with that at all, but do 
you think 50 years from now, that your hope is more efficient 
internal combustion engines, more diesel engines on the road? 
Or is it your hope that perhaps we do things that are 
transformative? For example, continuing to work on hydrogen 
fuel cells that are longer term? And if not the Department of 
Energy to work on this, who?
    And then finally, you didn't quite answer the question. Do 
you really want us to shut down about I think 190 research 
projects that are in the middle of the project? And we just 
say, ``You know what? That was yesterday's money, yesterday's 
Secretary, yesterday's idea. Shut them all down.'' And you 
really want us to do that?
    Secretary Chu. Well, I'd be happy to work with you and look 
at the details of where the programs are and things of that 
nature. And we can work out----
    Senator Dorgan. I'm hoping to help you with the funding for 
these projects, by the way, because I think--well, we may not 
be around in the long term, in the long term, we're all dead. 
But the fact is the near term is not the only thing that's 
important to us. If we're going to be transformative, I think 
you look out beyond 5, 10, and 20 years.

                            WIND DYNAMOMETER

    Let me ask you, Mr. Secretary, about an issue, wind 
dynamometer that is at NREL. My understanding is that we've 
spent a lot of money to test commercial wind turbines at NREL. 
I've been there. I've seen this, big investment in hardware. 
I'm told that the DOE is now pursuing competitive solicitation 
in the private sector for a dynamometer, rather than 
capitalizing on the investment made at NREL. Are we moving away 
from NREL as a center of expertise in this area, and if so, 
why?
    Secretary Chu. Well, actually, I'll confess I don't know 
that part of it. I do know that we have this wind test facility 
at NREL and there's a dynamometer. Getting the private sector 
involved is something I think the Department of Energy is very 
interested in. So I don't know the exact details of that.
    Senator Dorgan. Would you look at that?
    Secretary Chu. Sure.
    Senator Dorgan. And my understanding is, there's some 
interest in the Department of Energy to duplicate that 
investment in the private sector up in the Northeast, and I'd 
be very concerned about that. I mean, I would hope that we 
would continue having NREL as the center of that research.
    Secretary Chu. Oh, well, there's something else--maybe it's 
this, but we are making investments in Boston, but that's a 
wind test facility. That's not----

                                PENSIONS

    Senator Dorgan. That's not what I'm thinking of. And also--
I'm going to say really nice things about you in a moment, but 
I do want to ask these questions. It appears to me there's 
about a $500 million to $1 billion shortfall on the pension 
side.
    Secretary Chu. Yes.
    Senator Dorgan. And I think my colleague from Utah 
mentioned that, and I didn't hear, but maybe you've answered it 
since I----
    Secretary Chu. No, I actually didn't get to that. This is 
of great concern to us. We did scramble around for a lot of the 
money. This is a serious concern. We have a lot of employees 
and former employees, and we have an obligation to them. And so 
there was some last-minute scrambling to find some emergency 
funds. It's not completely covered yet. In the long term, this 
is an obligation the Department of Energy has in the sense that 
we have a liability. I don't think any other agency has this 
liability. We have to figure out a way, for example, of having 
our contractors move toward defined contributions rather than 
defined benefits. Of course, we grandfather in all the people 
that we've had obligation to. We're not talking about that. But 
this overhanging liability is something serious, and because of 
the stock market decrease and because of the new act that says 
it has 80 percent funded, we all of the sudden got these 
shortfalls.
    We're aware of the problem. The long-term fix will probably 
have to be something like evolving toward--as we get in new 
contracts, toward defined contributions.
    Senator Dorgan. Right. So we might have some unfinished 
business on the budget side. I mean, it appears to us it's a 
$500 million to $1 billion that's a shortfall. We'll have to 
continue to work with you on that.

                          RECYCLING SPENT FUEL

    Let me ask if you could just describe again, so that I 
understand, in shorthand under what conditions would you 
consider recycling spent nuclear fuel?
    Secretary Chu. If we could develop proliferation 
resistance, something that would be unlikely that terrorists, 
if they got hold of this material, could actually work with it 
as an example, if it has some soft protection, so it doesn't 
create a stream of separate plutonium or something that's 
easily shielded.
    There's also the economic viability of the processes in 
general. We want to see industry saying there's a path forward 
which that we can really invest in these recycling plans. And 
finally, we need to develop generation IV reactors, high-energy 
neutron spectrum reactors that can burn down this waste.
    I think actually all these things are solvable. It could 
take decades, but I'm certainly interested in looking at it, 
looking at the work. There's--if we extract a lot of the worth 
of the nuclear fuel, this is a clean source of energy, baseload 
energy, and I think the waste problem is solvable, and I think 
there's a likelihood if we do it right and get a bunch of very 
smart people on it, that we can develop these recycling 
methods.
    Senator Dorgan. And I would say, as you look out there, 
decades out on the horizon exist not just this issue, but 
hydrogen as well, in the longer term. You come from a science 
laboratory, are a Nobel Prize winner, a very distinguished 
person and I feel very strongly that the administration has 
solicited the service of someone who's extraordinary. So I'm 
very pleased you're there.
    But I also know where you are. You're in the Department of 
Energy, and that's a great place. You've got some great people 
there. But it's also an area filled with superglue in some 
areas. You just slow everything down then get it all stopped. 
On the issue of loan guarantees and the things that you've come 
to in this agency, an agency that in some areas, it just is 
almost impossible to move. You can observe more movement in a 
glacier than in the Department of Energy on some issues.

                      ACCELERATING LOAN GUARANTEES

    So tell me about what you have discovered and what your 
experience is with respect to getting some of these Loan 
Guarantee Programs moving that were just dead stopped.
    Secretary Chu. Well, we discovered first, that they could 
be increased by a factor of 5, maybe even 10. The only way we 
discovered this is actually, for example, we hired Matt Rogers, 
an outstanding person from McKinsey, and by literally first 
looking at other agencies in the Government, seeing how they do 
their loan programs, and then looking at how we do it, but then 
looking step by step at everything and how you actually go 
about the business in terms of little horror stories here and 
there. They said that the amount of paper required was such 
that they were concerned of any loans below several hundred 
million dollars. They couldn't know how people could afford to 
do this because of the paperwork required, the amount of 
paperwork, 500 to 1,000 pages. We're working very hard to 
reduce that. The target is 50 pages. If you can't get your idea 
out in 50 pages, there's something wrong with it.
    In terms of vetting, many of the times, if you have a dual 
vetting process, if there's a substantial financial investment 
and a bank does some of the things, we can then cooperate and 
do that. The idea that in helping the customers, the potential 
customers, there was a strong sense that you couldn't help any 
particular customer because it would be unfair, it was giving a 
particular advantage to that particular applicant. And so we're 
turning that around and saying there's another way to be fair--
help everyone. It's a novel thought, but we're moving ahead on 
that.
    And so what it really took after the first couple weeks to 
say, okay. The people there need a little help in seeing that 
you can actually move this considerably faster. The idea that 
you go in serially and then you get to the next point and you 
go again, it's like a long relay race. Every time you pass the 
baton, the baton's dropped.
    In actual fact, in industrial project management, in good 
project managements in the Federal Government, that's not done 
that way. You can start many things nearly in parallel. So we 
essentially are looking at every nook and cranny and finding 
that we can actually increase this considerably. And so, again, 
we went from getting the first loan out in 1\1/2\ years to 
getting the first loan out in 58 days from the time I took 
office. And so we are very anxious to see this continue.
    You made a reference to the fact that it is--the friction 
in the Department of Energy is considerable. Our committee is 
more that Newton was right--the body set in motion tends to 
stop the next day, unless you continue to apply pressure.
    But I think the good news is as we work through this and 
actually give people the tools and the ideas of how to do this, 
there is now beginning to be genuine excitement in the career 
people.
    Senator Dorgan. Senator Tester, did you have other 
questions?
    Senator Tester. Yes, I just had one, if I might.
    Senator Dorgan. Let me just--if you might, let me finish 
with my one question, then I'll recognize you for whatever you 
wish.

                           DECARBONIZING COAL

    People are coming to my office with really interesting 
ideas. I had a person in some while ago who has a couple 
hundred scientists working on developing synthetic microbes to 
chew the coal. That's a scientific term, chew the coal, I 
guess. Actually, the synthetic microbes would consume the coal, 
and through the consumption of coal by these microbes, you 
would produce methane, and probably even be able to do that in 
situ, underground.
    I have no idea whether that's just harebrained or 
unbelievably interesting in the next 5 years, 25, or 50 years. 
Someone comes to me with a patent that says, ``I have the 
silver bullet with respect to decarbonizing coal.'' In fact, we 
had a hearing on it, and the guy that comes to the hearing is 
the recognized expert in the country from Stanford on cement 
and concrete. And he takes all of the flue gas from a coal 
plant, and through mineralization, or whatever, produces a 
product that is, he says, harder than concrete and more 
valuable and contains all of the CO2.
    A company comes to me and says, ``We have a process by 
which we separate CO2 with the flue gas, and we get 
nitrogen, hydrogen, and baking soda, and baking soda contains 
all the CO2.'' Those are just three, but there are 
lots of them, lots of people out there doing interesting 
things.
    Give me your assessment. And the reason I'm asking this is 
because I believe, again, we're going to continue to use coal 
in the future. The question is, how effectively and at what 
cost do we decarbonize coal?
    Give me your assessment of those kinds of things and ideas, 
and are you running into them, and do you believe they 
represent great promise for the future?
    Secretary Chu. I'm running into them. I think many of them 
are very interesting, and we are looking at them very hard. I 
think one of the things that you're seeing and the things I'm 
also seeing is there's an unleashing of incredible ingenuity 
and imagination. Not all these things will work. Most of them 
will probably not work, but yet out of that, I think there's a 
great possibility that there would be some really very good 
ideas.
    I'm a big fan of, at least in these early stages, where it 
costs very little to explore these ideas, to explore as many of 
them as possible. Now, this is actually one of the joys of 
being in the job I have. We can look at these wonderful new 
ideas and say, ``Is there going to be merit in this 5, 10, even 
15 years out,'' of all those things, the concrete, the 
conversion of coal, so most of the pollutants and the really 
bad stuff is just left deep underground, and you just sip out 
the natural gas.
    These are potentially very good ideas. What's especially 
nice about some of these ideas, especially the one on the bio 
part, is that's occurring in an area where the science is 
advancing very rapidly. And so the chance of a dramatic 
breakthrough--because we now know how to reprogram these 
microbes in completely new ways, offer real hope.
    Whenever you see the science advancing most rapidly, 
there's more likelihood of getting really big breakthroughs.
    Senator Dorgan. Senator Tester?

                      RENEWABLE PORTFOLIO STANDARD

    Senator Tester. Thank you, Mr. Chairman. I just--there are 
two policies that we're wrestling with right now. One of them 
is putting a value on carbon, and the other one is a renewable 
portfolio standard. Assuming we put a value on carbon, is there 
really a need for a renewable portfolio standard?
    Secretary Chu. I think there is. Because of the way you are 
going to be capping and bringing down the cap in a gradual way, 
that it--and the type of legislation that is being discussed 
actually has to allow the United States to make this transition 
over a period of time. I mean, that's realistic. We just have 
to do that.
    And what our renewable portfolio standard does is it gives 
you a guaranteed market, and so it can tell investors, we need 
to get to let's say 15 or 20 percent. The price signal, if you 
will, from the cap and trade and the decrease in the carbon 
emissions is one way, but that has to be, by its very nature, 
in order for the country to make a transition, a slow gradual 
process, and a renewable electricity or renewable clean energy 
standard, you say, now I've created a market, and so it's a 
draw, so that the investment community can say, ``Yes, I can 
put in my wind turbines or my photovoltaics.'' So they actually 
complemented each other.
    Senator Tester. Okay. Thank you very much.

                     ADDITIONAL COMMITTEE QUESTIONS

    Senator Dorgan. Well, Mr. Secretary, you are the first 
Cabinet Secretary to use the term joy in describing your work 
in all the years I have served here, but I expect that joy 
reflects your background as someone who ran a science lab, and 
having access to all of the interesting things that are going 
on in these laboratories.
    At this time I would ask the subcommittee members to please 
submit any additional questions they have for the record.
    [The following questions were not asked at the hearing, but 
were submitted to the Department for response subsequent to the 
hearing:]

             Questions Submitted by Senator Byron L. Dorgan

    Question. The DOE currently has approximately 190 multi-year 
contracts for hydrogen related research that would be terminated under 
the fiscal year 2010 DOE budget request. How many of these contracts go 
through fiscal year 2010? What is the amount of funding that would be 
required in fiscal year 2010 to honor these existing contracts?
    Answer. The refocused Fuel Cell Technologies program allows the 
Department to prioritize technologies that will have a more immediate 
energy impact and bring consumers advanced transportation choices 
sooner. Certain projects in the areas of hydrogen production and 
delivery, hydrogen storage, technology validation, systems analysis, 
manufacturing, safety and codes and standards, education, and market 
transformation would not be funded at the 2010 request level. If the 
Department continued on the previous schedule, the 190 projects would 
require approximately $105 million in fiscal year 2010. However, 
project performers know that funding is subject to annual appropriation 
and changing priorities.
    Question. Congress set up the Hydrogen Technical Advisory Committee 
(HTAC) to provide detailed analysis of the hydrogen and fuel cell 
vehicle program to the Secretary. Did you consult with the HTAC before 
making the decision to terminate the hydrogen and fuel cell vehicle 
programs?
    Answer. The Secretary considered all available information before 
making the decision to re-focus research, development and demonstration 
activities on fuel cell system technologies. While the HTAC 
periodically submits reports, letters and other information to the 
Secretary for consideration, the HTAC primarily provides valuable 
technical progress information, which is only one of multiple entities 
supporting DOE funding allocation decisions.
    Question. The 2006 Hydrogen Posture Plan established key technical 
milestones and timelines. Would you agree that the hydrogen program has 
been meeting and exceeding these milestones? If this is the case, how 
would the fiscal year 2010 budget request not be short-circuiting the 
progress being made by this program?
    Answer. The Department agrees that the program has been meeting a 
number of the milestones. However, given the Nation's economic climate 
and the urgency in addressing climate change and petroleum reduction, 
the Department is balancing the advanced transportation technology 
portfolio to fast-track lower-risk energy technologies and to bring 
consumers near-term, advanced transportation choices. Technologies such 
as biofuels and plug-in electric drive vehicles will achieve benefits 
sooner, at less cost, and with less technology risk than hydrogen fuel 
cells.
    In addition, the Recovery Act provides approximately $41.9 million 
for near-term benefits such as commercialization and deployment of fuel 
cells and job creation in fuel cell manufacturing, installation, 
maintenance, and support services that will help develop a supply base 
that could eventually support automotive applications. The Department 
also plans to spend up to approximately $50 million in fiscal year 2010 
through the Office of Science for relevant cross-cutting basic research 
(e.g. catalysis, membranes and biological/photoelectrochemical 
approaches) to enable breakthroughs in hydrogen technologies and $16.4 
million through the Office of Fossil Energy to continue work on 
hydrogen production from coal, with carbon sequestration, due to the 
importance of zero carbon approaches.
                                 ______
                                 
              Questions Submitted by Senator Patty Murray

    Question. Secretary Chu, I am pleased to see an overall increase 
for Energy Efficiency and Renewable Energy. We've got to move forward 
toward a clean energy economy and this will help keep us on that path.
    And now that you have spent some time at the Department, I'm 
looking forward to hearing an update on the Water Power Program. As you 
know, the Program received $40 million in fiscal year 2009 and the 
President is requesting a 25 percent reduction in funding, which I am 
very concerned about. We must continue investment in our existing hydro 
facilities to allow us to use those flexible resources to firm up 
intermittent renewable resources like wind and solar. And we must also 
increase our work to develop new marine and hydrokinetic technologies 
that may also be able to act as base load resources in the future.
    What are your priorities for the Water Power program, specifically 
with regard to both marine and hydrokinetic technologies and also with 
regard to conventional hydropower?
    Answer. DOE is excited about the potential to develop both emerging 
marine and hydrokinetic technologies as well as untapped hydropower 
resources, including efficiency or capacity upgrades at existing 
facilities, the construction of hydropower plants at existing non-
powered dams, and the possible construction off small or ``low-impact'' 
hydropower and pumped storage facilities.
    The $40 million appropriated for water power in fiscal year 2009 
allowed DOE to initiate aggressive action to address both marine and 
hydrokinetics and conventional hydropower, and the Department is 
working diligently to ensure this new increased level of funding is 
spent carefully and wisely. The Department's current priorities for 
marine and hydrokinetic technologies (i.e. wave, tidal, in-stream, 
ocean current, and ocean thermal) are to evaluate the cost and 
performance of the various technology types, to determine how much 
energy is available and extractable from each resource, to support the 
industry in designing and testing innovative energy conversion devices, 
and to predict and evaluate the possible environmental impacts of water 
power technologies. As the size of these resources and the ability of 
emerging technologies to capture those resources becomes clearer, the 
Department will be better able to determine if higher funding levels 
are necessary.
    DOE also recognizes that incremental conventional hydropower 
generation requires a careful second look, and is particularly 
enthusiastic about its potential to provide on-demand, dispatchable 
power to support grid stability and further integrate variable 
generation. The Department's priorities for hydropower are to address 
barriers to the development of incremental hydropower generation 
(including efficiency and capacity upgrades at existing facilities and 
the construction of facilities at existing non-powered dams) and to 
address the development of pumped storage. DOE is undertaking a 
comprehensive effort to understand existing hydropower assets and 
resources, to identify undeveloped incremental hydro resources and 
costs, to quantify and maximize the value of the existing hydro fleet 
to support the grid, and to improve the environmental performance of 
hydropower generation in the United States.
    Question. Mr. Secretary, I've already reiterated my invite for you 
to come out to Washington and see the DOE footprint in my State. And I 
also want to encourage you--again--to visit the Marine Sciences 
Laboratory in Sequim, Washington. Not only is it located on the 
beautiful Olympic Peninsula, it is also the Department's only marine 
sciences lab. I encourage you to use the Water Power Program to expand 
the work at the lab, and utilize the expertise and knowledge there.
    I am not reassured that this administration sees the value of this 
potential clean energy source. Can you tell me how you plan to 
integrate the Marine Sciences Laboratory into the Water Power Program?
    Answer. The Department is funding a number of activities in the 
Pacific Northwest, including PNNL's Marine Sciences Lab. Researchers at 
the Marine Sciences Laboratory work closely with the DOE-funded 
Northwest National Marine Renewable Energy Center, a partnership among 
DOE, the University of Washington, and Oregon State University. The Lab 
also supports environmental assessments at two tidal energy projects in 
the Puget Sound led by 2008 DOE grant recipients, Verdant Power and 
Snohomish County Public Utility District, so that it can thoroughly 
test and develop marine energy technology designs and launch 
demonstration projects. In addition, two DOE solicitations (FOAs No. 
DEFOA0000069 and 0000070) for water power projects closed on June 4, 
which included environmental studies for marine energy, and for which 
PNNL was eligible to apply.
    Question. Secretary Chu, hydropower is an important clean energy 
resource in the Pacific Northwest. Work is needed to assess potential 
resources and environmental impacts, technical upgrades, integration 
with renewable, and the potential of pumped storage. How do you plan to 
support these conventional hydropower needs within the Water Power 
program?
    Answer. The Department recognizes the strong role that conventional 
hydropower plays in our Nation's renewable energy portfolio and is 
enthusiastic about exploring further the untapped potential of 
incremental conventional hydropower. We are addressing its needs in our 
Water Power Program through four strategic objectives: understanding 
assets and resources, increasing incremental power generation, 
improving environmental performance, and maximizing hydropower values 
to the grid. A key first step is a project the Department is calling 
the National Hydropower Asset Assessment. This effort will build and 
analyze a unique and comprehensive database of existing Federal and 
non-Federal projects, their generation outputs, and water availability 
at the projects. This assessment will also provide a basis for 
evaluating current technology needs and opportunities that will help 
hydropower maintain its important position among renewable energy in 
the United States.
    The Department is also soliciting new, industry-led projects to 
assess undeveloped hydropower resources at existing dams in the United 
States. This opportunity is encompassed within the Advanced Water Power 
Funding Opportunity Announcement (DE-FOA-0000069), which will be 
announced this summer. DOE laboratories are also engaged in providing 
new engineering and environmental R&D to support the hydropower 
industry.
    Question. Mr. Secretary, what incentives can we put in place to 
facilitate the development of new pumped storage resources and the 
continued investment in our existing hydro facilities, to allow us to 
use those flexible resources to firm up intermittent renewable 
resources like wind and solar?
    Answer. Development of new pumped storage projects in the United 
States faces major challenges in two areas: financing very large 
capital construction costs, and surviving a long, costly, and uncertain 
regulatory process that is as complex as that associated with nuclear 
power. If new pumped storage projects used renewable energy in their 
pump cycle, these projects could also get consideration for inclusion 
in renewable energy standards, which would provide an additional 
financial incentive for development. Other policy initiatives that 
would help this type of development include streamlining the regulatory 
process and designing energy markets that return more reliable, long-
term benefits to developers of generation units that provide valuable 
services to the Nation's electricity grid.
    DOE recently issued a Notice of Intent on the $3.3 billion Smart 
Grid Investment Grant Program and a draft Funding Opportunity 
Announcement (FOA) for an additional $615 million for Smart Grid 
Demonstrations funded by the Recovery Act. Energy storage technology 
and specifically smart grid applications, including integration of 
pumped hydro storage with renewable resources like wind and solar, are 
within the scope of these two Recovery Act projects. The Department is 
in the process of reviewing all comments received during the public 
commenting period for incorporation into the final FOAs, both of which 
are expected to be released in June 2009 through the FedConnect portal 
at www.fedconnect.net.
    Question. As DOE builds toward President Obama's clean energy 
economy, how will DOE evaluate a resource's contribution to and 
potential to meet these important, ambitious energy and environmental 
goals? What role does DOE anticipate for hydropower in helping to meet 
these objectives, especially as Congress moves to address global 
warming?
    Answer. DOE is actively investigating the potential role of water 
power technologies, including both emerging marine and hydrokinetic 
technologies as well as conventional hydropower, in meeting the 
President's clean energy goals.
    The Department is working to better understand the role for the 
full suite of marine and hydrokinetic technologies, including wave, 
tidal, ocean current, river in-stream, and ocean thermal energy, by 
evaluating the cost and performance of the various technology types, 
determining how much energy is available and extractable from each 
resource, supporting the industry in designing and testing innovative 
energy conversion devices, and predicting and evaluating the possible 
environmental impacts of water power technologies. As the size of these 
resources and the ability of emerging technologies to capture them 
becomes clearer, the Department will better be able to assess their 
true potential in contributing substantially to the national 
electricity generation portfolio.
    In addition, DOE is enthusiastic about the potential development of 
certain untapped hydropower resources, including efficiency or capacity 
upgrades at existing facilities, the construction of hydropower plants 
at existing non-powered dams, and possibly the construction off small 
or ``low-impact'' hydropower and pumped storage facilities. As a large-
scale, and quickly dispatchable generation source, incremental 
hydropower may be able not only to provide a clean and renewable source 
of electricity but also facilitate the further integration of 
intermittent renewable resources.
    Question. As you know, transportation emissions are a significant 
source of greenhouse gas emissions. This administration is investing 
considerably in alternative fuels for energy security and environmental 
reasons; however, most of those are focused on personal vehicles. As 
you know, air transportation is solely dependent on jet fuels at this 
time. What thought has DOE given to advancing jet biofuels, including 
research and development, feedstock development, technology and 
infrastructure?
    Answer. Traditionally, DOE has focused on ground transportation 
fuels, while most air transportation work has been conducted by the 
Department of Defense, the Department of Transportation and the 
National Aeronautics and Space Administration. However, DOE has begun 
to focus on the production of heavy duty fuels including, ``green'' and 
renewable diesels, and aviation fuels.
    For example, the Joint BioEnergy Institute led by Lawrence Berkeley 
National Laboratory is re-engineering microbes to produce hydrocarbon 
fuels like green gasoline, diesel, and jet fuel. A subset of recently 
selected DOE Energy Frontiers Research Centers will focus on 
fundamental research related to producing advanced biofuels, such as 
bio-oils from microalgae, which are promising intermediates for the 
production of advanced biofuels, including green jet fuel. The National 
Renewable Energy Laboratory, Sandia National Laboratory, and other 
laboratories are also launching research into algal biofuels for the 
Defense Advanced Research Projects Agency and Air Force Office of 
Scientific Research. Algae-based fuels will also be eligible for both 
Advanced Research Projects Agency-Energy and DOE Loan Guarantee funding 
opportunities.
    Additionally, DOE will use Recovery Act funding to support a 
competitive solicitation for two research consortia aimed at 
accelerating the development of cost competitive advanced fungible 
biofuels, which include hydrocarbon fuels, diesel and jet fuel, and 
algae based biofuels which also include jet fuel. The solicitation is 
expected to be released in the summer of 2009. In order to capture 
relevant technologies that are ready for deployment, a current 
competitive solicitation closing on June 30, 2009 allows for pilot- and 
demonstration-scale biorefineries that include jet fuel from biomass. 
DOE's Office of Fossil Energy announced $70.6 million of Recovery Act 
funding will be spent to facilitate the existing algae-based carbon 
mitigation project at Cholla Power Plant in Holbrook, Arizona to expand 
testing with a coal-based gasification system. The goal is to produce 
fuels from domestic resources while reducing atmospheric CO2 
emissions. DOE's Office of Fossil Energy and the National Energy 
Technology Laboratory issued a Recovery Act funding opportunity on June 
8 that allows conversion of to CO2 biomass (algae, for 
example) and subsequent biofuels production as a mechanism of 
CO2 sequestration and use.
    Question. Secretary Chu, I want to ask about a section of the 
hydrogen fuel cell budget, the Market Transformation program. This 
subcommittee has in the past supported the Market Transformation, which 
helps support fuel cell deployment in early commercial applications, 
because we share your view that we ought to do now what we can do now 
on fuel cells. I understand that you allocated a small part of the 
stimulus dollars to fuel cell deployment this year. Can you tell me why 
the President's budget proposes no funding for Market Transportation 
program?
    Answer. The President's budget proposes no additional funds for 
market transformation activities in fiscal year 2010 because the $41.9 
million of Recovery Act funding dedicated to fuel cell market 
transformation activities will support 13 projects over fiscal year 
2009 and fiscal year 2010. These projects will deploy more than 1,000 
fuel cells and will help create jobs in fuel cell manufacturing, 
installation, maintenance and support service sectors. Together with 
$72.4 million of industry cost-share, the total 2-year funding for 
these projects is $114.3 million.
                                 ______
                                 
            Questions Submitted by Senator Robert F. Bennett

        LOAN GUARANTEES--LOAN PROGRAM--3.5 YEARS AND NO REWARDS

    Question. Mr. Secretary, the Department has taken over 3.5 years to 
establish the loan guarantee program and it still has not granted a 
single loan guarantee. I believe this program has tremendous potential, 
but worry that it is not being implemented in a timely and effective 
manner. For example:
    GAO recently notified the subcommittee staff that the current 
subsidy model used to establish the risk premiums paid by applicants 
was suspended in February by OMB.
    Finally, I understand you have also proposed several changes to the 
operations of the loan guarantee program, but many of these reforms 
have yet to be implemented.
    How soon, will you be implementing your reforms and will any of 
these changes require legislation?
    Answer. The Department is continuously implementing changes in its 
procedures that facilitate the loan guarantee process. The Department 
of Energy has not identified any needed legislative changes.
    Question. When do you expect to make final awards in light of OMB 
suspending the use of the credit subsidy model?
    Answer. To clarify, OMB did not suspend the credit subsidy model. 
In implementing the model, the Department identified a technical issue 
related to certain types of projects and OMB and DOE have resolved the 
issue. The Department issued a conditional commitment for its first 
loan guarantee in March and issued two additional conditional 
commitments in July.
    Question. Is there anything Congress can do to help?
    Answer. The Department appreciates Congress's support for this 
important program.

                            INDUSTRY LETTER

    Question. I have attached a copy of the letter sent to the 
President regarding specific reforms to the Loan Guarantee program.
    Can you please review each of the specific recommendations and 
provide a written response to the subcommittee as to your position of 
each of the policy recommendations and possible impact to the program.
    Answer. The Department is currently reviewing the letter.
    not all science funding is equal--especially at the weapons labs
    Question. Mr. Secretary, I am troubled by the disparity in funding 
for applied and fundamental scientific research provided to DOE labs 
verses the NNSA labs. Clearly, the cancellation of the Los Alamos 
Neutron Science Center (LANSCE) Refurbishment is the most glaring 
example of the selectiveness of the research funding in this budget. 
The LANSCE facility is the scientific corner stone of Los Alamos, 
serving both classified and unclassified work and with over 500 users 
annually.
    How do you explain the failure in the budget to link the DOE and 
NNSA science?
    Answer. Budgeting is, in the end, an exercise in priorities and 
choices with limited resources. While there is certainly good science 
that could be done with a refurbished LANSCE, other investments in both 
NNSA and Science facilities will yield a greater and more immediate 
benefit. A refurbishment could be considered in the next budget cycle.
    Question. The OMB Web site lists LANSCE refurbishment as a 
terminated program and specifically states one reason being that 
Nuclear Energy Office doesn't support isotope production any longer. 
Last year the isotope program was shifted to the Office of Science 
program. Will LANSCE continue to have a roll [sic] in the Science 
program?
    Answer. The Isotope Production Facility (IPF) at LANSCE uses a 
portion of the H+ beam extracted at 100 MeV from the 
accelerator; this facility produces a variety of radioisotopes used in 
medical diagnosis and treatment and for scientific research. Together 
with DOE's Brookhaven and Oak Ridge National Laboratories, the IPF 
provides the national supply of radioisotopes not available 
commercially for both research and applications. In addition to regular 
fiscal year 2009 appropriations and an fiscal year 2010 request within 
the Office of Science, the IPF is currently receiving Recovery Act 
funds from the Office of Science for enhanced isotope production 
capabilities and R&D. The LANSCE accelerator also supplies protons to 
the Lujan Center, a pulsed spallation neutron source that is used by 
researchers supported by the Office of Science, NNSA, and other 
agencies.

           THE NEED FOR SCIENTIFIC LEADERSHIP WITHIN THE NNSA

    Question. Mr. Secretary, in light of your budget, which fails to 
adequately invest in building the science missions at the NNSA labs, I 
believe we need to establish a new position within the NNSA to steward 
and cultivate scientific research using the existing NNSA facilities. I 
believe this position should report to Secretary, Deputy Secretary and 
the NNSA Administrator. This might help raise awareness of both the 
weapons science, and non-weapons science that goes on at our NNSA labs. 
Certainly the grand challenge of energy security and climate change 
science are of such complexity that this work can and should be shared 
with all the labs.
    I am considering a modification to the NNSA Act to create a new 
position within the NNSA reporting directly to you to lead the NNSA 
science program and to work with the rest of the Department to 
integrate the national security capabilities with those in basic and 
applied programs within DOE. What do you think about that?
    Answer. I share your concern about sustaining science and 
engineering vitality at the NNSA's laboratories at Los Alamos, 
Livermore and Sandia. We are considering how to best broaden and 
sustain our science underpinning of nuclear security and how to do that 
appropriately for the related interests of other agencies that use 
these laboratory capabilities for science and national security 
missions. It is possible that a new position as you describe could be 
appropriate and useful in sustaining and advancing the science and 
engineering the Nation needs. At present we are focusing on basis and 
needs for our nuclear security science and engineering considering both 
the Department's missions and the related interests such as those in 
the intelligence community, the Department of Defense and the 
Department of Homeland Security. Within a few months, when I have a 
clearer picture of the basis and needs for these science and 
engineering skills, we will be in a better position to discuss the 
change you propose.

                        FOSSIL ENERGY--FUTUREGEN

    Question. The FutureGen project was halted due to cost escalations, 
but it is my understanding that the administration is considering 
resuming this project, using $1 billion in Recovery Act Funds to do so.
    Can you share with us your thoughts on resuming this project?
    Answer. DOE officials have been meeting with officials of the 
FutureGen Industrial Alliance, Inc., and on June 12, Secretary Chu 
announced that an agreement was established with the Alliance to move 
forward with the FutureGen project pending a joint decision based on a 
detailed cost estimate and fundraising activities, thereby limiting the 
risk of cost increases while accomplishing the goals of the program.
    Question. There is roughly $1.5 billion available for the Clean 
Coal Power Initiative (CCPI) round three solicitation. This far exceeds 
the initial requested amount for this solicitation, and in large part 
is due to project defaults from previous rounds. This research also 
mirrors the demonstration goals of building a zero-emission coal plant 
as proposed by FutureGen.
    Will you please explain to us why you are considering restarting 
the FutureGen project, when that same type of research is available for 
the CCPI round three solicitation?
    Answer. The FutureGen project has already completed conceptual 
design, project siting, approximately 1 year of preliminary design 
activities, an extensive Environmental Impact Statement (EIS), and an 
associated risk assessment. With those activities already completed, if 
the project was reinstated in the near future, the FutureGen Alliance 
conceptually could complete preliminary and detailed design and, if a 
decision were made to proceed, potentially could start the construction 
phase in 2010. Conversely, commercial demonstration projects resulting 
from the CCPI round three solicitation are at the proposal or project 
definition stage of development. Accordingly, it may take those 
projects considerable time to commence construction, compared to 
FutureGen. Given the time-sensitive nature of both climate change and 
economic recovery, the FutureGen project (if it is restarted) could 
provide a demonstration of technology that could accelerate follow-on 
activities such as CCPI projects (where relevant.) Also, CCPI 
demonstration projects may involve different technologies and site 
locations than FutureGen. We believe it is prudent to develop a 
portfolio of power plant and carbon capture technologies, as well as to 
compile operational experience on different regional sequestration 
geologies throughout the United States.
    The FutureGen Project will provide for the design, construction and 
operation of a coal-fueled, integrated gasification combined cycle 
(IGCC) with pre-combustion subsystems for the capture of carbon dioxide 
and geologic sequestration into a saline formation. In comparison, 
CCPI-3 will provide commercial demonstration projects that may include 
post-combustion capture systems or an oxy-fueled combustion process. 
CCPI-3 will provide one or more sequestration options, including 
beneficial reuse in enhanced oil recovery or enhanced coal bed methane 
recovery options as well as the possibility of basalt formations or 
stacked storage. The different approaches provided by these programs 
will support an expanded portfolio providing the DOE the ability to 
make progress toward capture and sequestration goals.

                                SCIENCE

    Question. This budget includes over $300 million in new Secretarial 
priority initiatives, while funding for Nuclear Energy, Fossil Energy 
and NNSA Science have all been reduced.
    How do you reconcile this investment?
    Answer. Under the Secretary's proposed initiatives the Department's 
overall investment in Nuclear Energy, Fossil Energy, and NNSA will 
actually increase, with new funding going into areas with the biggest 
potential pay-off for the Nation. In Nuclear Energy, the Secretary is 
proposing two new Energy Innovation Hubs, one to support ``Extreme 
Materials'' with the goal of achieving higher reactor efficiencies and 
one to support advanced computer modeling and simulations of nuclear 
processes and systems. For Fossil Energy, a Hub is envisioned to 
advance Carbon Capture and Sequestration technology. And, within the 
NNSA, funding shifts from construction to the transition of the 
National Ignition Facility to a fully capable experimental facility in 
pursuit of the first ignition campaign.
    In addition, the RE-ENERGYSE program (Regaining our ENERGY Science 
and Engineering Edge) is a $115 million new initiative designed to 
attract and train the next generation workforce for the 21st century 
energy economy. RE-ENERGYSE will support education and R&D initiatives 
in all energy programs.

                                 ARPA-E

    Question. In light of the new Energy Hubs, large untapped potential 
in the loan guarantee program, and substantial funding increases for 
EERE and Science, I am trying to figure out the role ARPA-E at the 
Department of Energy, except as another layer of bureaucracy.
    Can you please provide a specific example or technology that will 
benefit from ARPA-E and how is it different from the loan guarantee 
program, office of science or renewable energy efforts?
    Answer. ARPA-E is a highly entrepreneurial program that will fund 
``creative, out-of-the-box, transformational'' energy research not 
currently funded by other programs. ARPA-E seeks to accelerate 
transformational advances in areas which address national energy 
priorities and are too risky for industry to invest in without public 
support. Transformational R&D is about creating new ways of doing 
things and leading to the next generation of technology that will allow 
the United States to be competitive in the global market.
    ARPA-E will seek out the best ideas and move quickly to bring 
selected immature energy technologies with exceptional potential beyond 
the risk barriers that prevent their translation from the laboratory 
bench to the marketplace. Essential aspects of this nimble and flexible 
approach include:
  --Technology Focus Flexibility.--ARPA-E will look for the best 
        opportunities to improve energy security and curb climate 
        change by making significant programmatic investments lasting 2 
        to 5 years. ARPA-E will fund transformational, high risk 
        technologies with the potential for 2-3  improvements in 
        technology performance and/or cost when compared to current 
        technologies. ARPA-E will then move on to the next big ideas, 
        shifting into and out of areas depending on the most promising 
        opportunities for transformational change.
  --Programmatic Flexibility.--ARPA-E will have the flexibility to 
        forge and nurture optimized partnerships that combine unique 
        talents and insight from different fields. The programs can use 
        DOE's ``Other Transactions'' authority (Technology Investment 
        Agreements) to help attract organizations that traditionally do 
        not participate in Government RD&D programs. Also, ARPAE will 
        promote results-oriented programs through the use of 
        challenging program milestones and the discipline to end 
        programs that fail to perform.
  --Organizational Flexibility.--ARPA-E is a lean, flat organization 
        that reports directly to the Secretary of Energy. ARPA-E has 
        very broad hiring authority to attract program managers from 
        universities, industry, the venture capital community and 
        elsewhere. Program managers will be part of the organization 
        for 3 year terms--not for their entire career. After having 
        made a successful technology impact, they will move on to other 
        opportunities in industry, academia, and elsewhere. ARPA-E's 
        structure will promote technical and programmatic agility by 
        ensuring that the organization has the right resources to 
        address the goal of enhancing the United State's economic and 
        energy security.
    These essential aspects of ARPA-E's approach will allow scientists 
and technologists to rapidly bring transformational ideas to a level of 
maturity sufficient for industry to take over development and bring the 
resultant technologies to market. ARPA-E's mission is to enhance the 
economic and energy security of the United States by developing new 
energy technologies that offer the potential for making significant 
progress toward reducing imported energy; reducing energy-related 
emissions, including greenhouse gases; and improving energy efficiency.
    Each of the other existing DOE organizations has a unique role that 
ARPA-E complements.
  --The Office of Science (SC) is charged with discovery and knowledge 
        generation. SC is focused on the fundamentals of energy-related 
        science, generating new discoveries and a base of knowledge 
        which are used to create future energy technologies and improve 
        existing ones.
  --The Office of Energy Efficiency and Renewable Energy (EERE) and the 
        other Applied Programs at DOE are focused on applied R&D as 
        well as demonstration and deployment activities in specific, 
        targeted, program areas which address national energy 
        priorities and in collaboration with industry. Both EERE and 
        ARPA-E focus on high pay-off technology development. However, 
        EERE supports a more focused suite of technologies through a 
        longer gestation period. Such longer-term support may include 
        commercial viability demonstration projects which are often 
        necessary before market acceptance of capital-intensive energy 
        technologies as well as activities which address other 
        information, market, and regulatory barriers to technology 
        adoption. The commercial demonstration projects involve large 
        scale engineering and process integration work and require 
        specialized management and oversight.
  --The Energy Innovation Hubs, modeled on the Department's successful 
        Bioenergy Research Centers, will focus significant R&D 
        resources within SC, EERE and other Applied Programs on a 
        sustained development approach to basic and applied R&D on our 
        most critical energy science and technology challenges. This is 
        to be contrasted with the opportunistic style of ARPA-E, which 
        is designed to push an area rapidly forward and then move on to 
        another priority. Each Hub will be comprised of a highly 
        collaborative team spanning many disciplines and drawn from the 
        full spectrum of R&D practitioners--including universities, 
        private industry, non-profits, and national laboratories--and 
        each Hub is expected to become a world leader for R&D in its 
        topical area. The Hubs will support cross-disciplinary R&D 
        focused on the barriers to transforming energy technologies 
        into commercially deployable materials, devices, and systems. 
        Each Hub has proposed funding at $25 million per year, for a 5-
        year term, with additional start-up funding of $10 million in 
        the first year for renovation (but not ``bricks and mortar''), 
        equipment, and instrumentation.
  --The Loan Guarantee Program is for a later stage of technology 
        development, guaranteeing loans to support early commercial use 
        of advanced technologies (and for a limited time commercial 
        technologies under the Recovery Act). The Loan Guarantee 
        Program is targeted at early commercial use, not energy 
        research, development, and demonstration programs.
    Each of the organizations has a unique contribution for creating, 
developing, and deploying the energy technologies this Nation needs. 
ARPA-E was formed this spring and has released its first solicitation, 
but has not yet selected nor funded any projects. ARPA-E is organized 
to manage high risk R&D projects proactively. Many years of experience 
in scientific research and technology development have shown that 
different stages of the science and technology enterprise need 
different management styles and organization. ARPA-E complements the 
existing DOE organizations by adding one specifically organized and 
focused on high-risk transformational technologies.

                             NUCLEAR ENERGY

    Question. Will the United States continue to play a role in the 
Global Nuclear Energy Partnership international discussions and 
contribute actively to these meetings and support international 
research and best practices regarding nuclear safety, security and 
nonproliferation? Will the Department of Energy continue to send staff 
to participate in these meetings?
    Answer. Yes, the United States continues to support the objectives 
of the international component of GNEP and the use of civil nuclear 
energy in ways that advance safety, security and nonproliferation. The 
Department continues to participate in the GNEP international meetings 
while the subject of how best to achieve GNEP-international objectives 
is undergoing an interagency review. We believe that proliferation 
issues should be a top priority in any discussions about the expanded 
use of civil nuclear energy and, in particular, in discussions that 
relate to development, deployment and operation of fuel cycle 
technologies. Thus, it is important for the Department to remain 
engaged in international meetings and activities that are developing 
strategies to ensure reliable nuclear fuel services and to provide 
management options for spent fuel in a manner that minimizes 
proliferation concerns.

                             YUCCA MOUNTAIN

    Question. Nuclear power will be critical to reaching our energy 
independence and reducing our reliance on fossil fuels. Yet, with the 
termination of Yucca Mountain in this budget, we still have no clear 
strategy on how to deal with nuclear waste.
    Exactly what is the Department's strategy to deal with spent fuel?
    Answer. 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.
    Question. Why should the ratepayers, who have paid $20 billion in 
fees, be forced to continue to store on site and not be entitled to a 
refund of these fees?
    Answer. We remain committed to meeting our obligations for managing 
and ultimately disposing of spent nuclear fuel and high-level 
radioactive waste. 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. The administration looks forward to 
ongoing dialogue with members of Congress, interested stakeholders, and 
others as we review these alternative approaches in the months ahead.
    Question. You have announced that you intend to appoint a Blue 
Ribbon Commission to consider all the options for addressing our spent 
fuel needs.
    When do you intend to appoint this commission and what will they 
specifically be asked to consider?
    Answer. The ``blue-ribbon'' panel will provide the opportunity for 
a full public dialogue on how best to address this challenging issue 
and will provide recommendations that may form the basis for working 
with Congress to revise the statutory framework for managing and 
disposing of spent nuclear fuel and high-level radioactive waste. As we 
go forward with convening the panel, I will keep Congress informed of 
our progress.

        IDAHO NATIONAL LAB--NEXT GENERATION NUCLEAR PLANT (NGNP)

    Question. Mr. Secretary, the Idaho laboratory has aggressively 
pursued the Next Generation Nuclear Plant (NGNP) project. The Energy 
Policy Act of 2005 authorized the construction of this reactor at the 
Idaho National Lab.
    The fiscal year 2010 budget documents make no mention of this 
plant. In fact, rather than prioritizing research on two advanced 
technology reactors which were down selected last year, this budget 
proposes to expand research back to 6 types of advanced reactors.
    Can you please explain the justification for expanding the 
Department's research priorities? Where is this program headed and what 
does it mean for the NGNP reactor at Idaho?
    Answer. The fiscal year 2010 budget request of $191 million 
represents a firm commitment to move forward with needed long term 
research and development on underlying technologies supporting 
Generation IV reactor concepts, including high temperature gas reactors 
under consideration for the Next Generation Nuclear Plant (NGNP). The 
request also includes $35 million for a modeling and simulation Energy 
Innovation Hub. The Department is currently evaluating its long-term 
plans for the NGNP project, which would rely on the private sector 
entering into a cost-sharing partnership with the Department. This 
budget request reflects the Department's commitment to be a strong 
partner in support of gas reactor technology.

                                PENSIONS

    Question. Understanding that the pension funding shortfalls 
continue to shift on a daily basis; will the Department please provide 
written quarterly updates regarding the estimated pension shortfalls 
and programmatic impacts?
    I think every member of this subcommittee would classify 
Environmental Cleanup as a priority, and you can see this in the 
funding provided in the Recovery Act. However, your request decreases 
the funding from fiscal year 2009 based on funding in the Recovery Act. 
EERE and Science also received large sums of money in the Recovery Act, 
but both of those programs are increased in your budget request.
    How can you justify cutting cleanup because of Recovery Act funds, 
when you have a $400 million pension shortfall in this program?
    Answer. The Department closely monitors the funding obligations 
associated with DOE contractor sponsored defined-benefit (DB) pension 
plans. Each contractor that sponsors a DB pension plan collects 
information to determine a plan's funded status as of the end of each 
pension plan year (that for most plans is December 31) that is then 
certified by a plan's actuary as of April 1. This funded status is the 
basis for determining what level of funding the contractor must 
contribute to a DB pension plan to ensure that as of the end of a plan 
year the plan is funded in accordance with applicable law (e.g., the 
Employee Retirement Income Security Act) and Departmental direction. 
Evaluations of a plan's funded status at interim points during the 
pension plan year would not change the level of funding required for 
that pension plan year or provide any certainty about what level of 
funding will be needed for the next pension plan year. Therefore, 
quarterly updates on the funded status of a plan would not provide 
information that would be useful in determining the amount of funds 
that will be needed to meet annual funding requirements. However, the 
Department is prepared to brief your staff on this issue at any time.
    The fiscal year 2010 budget request for the Environmental 
Management program supports the Department's mission and allows 
contractors to make all required pension payments to their DB pension 
plans.
    Question. Do you foresee any layoffs at any of the cleanup sites as 
a result of unfunded pension obligations?
    Answer. The Department closely monitors the funding obligations 
associated with DOE contractor sponsored defined-benefit (DB) pension 
plans. Each contractor that sponsors a DB pension plan collects 
information to determine a plan's funded status as of the end of each 
pension plan year (that for most plans is December 31) that is then 
certified by a plan's actuary as of April 1. This funded status is the 
basis for determining what level of funding the contractor must 
contribute to a DB pension plan to ensure that as of the end of a plan 
year the plan is funded in accordance with applicable law (e.g., the 
Employee Retirement Income Security Act) and Departmental direction. 
Evaluations of a plan's funded status at interim points during the 
pension plan year would not change the level of funding required for 
that pension plan year or provide any certainty about what level of 
funding will be needed for the next pension plan year. Therefore, 
quarterly updates on the funded status of a plan would not provide 
information that would be useful in determining the amount of funds 
that will be needed to meet annual funding requirements. However, the 
Department is prepared to brief your staff on this issue at any time.
    The Department does not anticipate impacts to the EM contractor 
workforce during fiscal year 2010 due to contractor funding of DB 
pension plans.

                         ENERGY INNOVATION HUBS

    Question. Mr. Secretary, this budget provides $280 million to 
establish eight energy hubs, a personal priority of yours. These eight 
centers of excellence will attack energy related problems in a 
collaborative manner.
    Why did the budget recommend establishing a hub for extreme 
materials research within the Office of Nuclear Energy and at the same 
time cancel the refurbishment of the Los Alamos Neutron Science Center, 
which supports a similar mission and also has computing capabilities?
    Answer. The Energy Innovation Hub for Extreme Materials will be 
competitively chosen. Its mission will be to support cross-disciplinary 
research and development focused on the barriers to transforming energy 
technologies into commercially deployable materials, devices and 
systems. Since the location and specific work scope of the Energy 
Innovation Hub for Extreme Materials will be decided through a 
competitive procurement process, it must be independent of the 
refurbishment of the Los Alamos Neutron Science Center.
    While there is certainly good science that could be done with a 
refurbished LANSCE, DOE believes that other investments in other 
facilities will yield a greater and more immediate benefit.
    The eight Energy Innovation Hubs will advance highly promising 
areas of energy science and technology from their early research 
concept stage to the point where the risk level is low enough for 
industry to deploy them into the marketplace. The work of the Hubs will 
encompass the full span from basic research to engineering development 
to commercialization and hand-off to industry.
    Question. Did the Department give any thought to establishing a hub 
to focus on environmental cleanup? What about a hub to defeat the cyber 
security threat?
    Answer. The Department deliberated at length on the optimum number 
and topics for the Energy Innovation Hubs. The goal for the Hubs is to 
make significant progress in overcoming current barriers to the United 
States' becoming a global leader in new energy technologies. The focus 
of the Hubs is on development and commercialization of clean, economic, 
sustainable energy technologies.
    Neither the Environmental Management program nor Cyber Security 
efforts in the Department fall within this ``energy technologies'' 
focus of the Hubs. And, in fact, each of these efforts is already well 
defined and supported. That said, the concept of establishing a Hub for 
either Environmental Management or Cyber Security could be considered 
in the future if such an idea seemed advisable.

                             WEATHERIZATION

    Question. The weatherization assistance program has over $5 billion 
available from the ARRA, Continuing Resolution, and fiscal year 2009. I 
am told that the Department will be spending that money over the next 3 
years.
    How can you justify another $220 million request when you cannot 
spend it this fiscal year?
    Answer. To achieve the increases in the numbers of homes 
weatherized, State and local agencies are in the process of hiring and 
training thousands of workers. In addition to increased hiring, State 
and local agencies will be making a substantial capital investment in 
procuring vehicles and equipment to outfit these new weatherization 
crews. However, the ``ramp-up'' in the number of weatherized homes per 
month enabled by Recovery Act funds will not be fully realized until 
the hiring, training, and acquisition process is completed. DOE expects 
that the weatherization network should be close to its target rate of 
22,000 homes weatherized per month by the end of the year. As a result, 
DOE expects that weatherization activities enabled by the Recovery Act 
should continue into 2011.
    Additional funds in fiscal year 2010 are required to maintain the 
pace of hiring, training and expansion enabled by the Recovery Act in 
order to build the capacity needed to realize the President's goal of 
weatherizing 1 million homes annually. Without this continued 
investment, new hires could be lost at the end of 3 years and local 
agencies could be saddled with excess vehicles, equipment, and costs 
associated with lay-offs of their work forces.

                             CYBER SECURITY

    Question. Mr. Secretary, the largest increase in the budget of the 
Office of Electricity Delivery and Reliability is for cyber security. 
No doubt, this is in response to the press reports that foreign hackers 
can gain access to our electrical grid.
    However, NNSA cyber security staff has briefed the subcommittee 
regarding a large and sustained increase in cyber attacks against 
Department systems this year. Unfortunately, the budget for NNSA cyber 
security fails to provide any increase to combat these cyber attacks on 
our national security infrastructure.
    How do you rationalize an increase in the Office of Electricity, 
but no increase for the NNSA?
    Answer. NNSA's cyber security budget was not increased because NNSA 
has sufficient resources to address the threats.
    Question. Do you believe you have the threats to the NNSA 
classified and national security information contained?
    Answer. The threats to the national security information and 
classified system within the NNSA computing environment are constantly 
changing and represent risks to our operations. However, with the 
technology enhancement (i.e. EnCase Enterprise) and process 
improvements (NNSA Policy (NAP)) NNSA has invested in over the past 2 
years, I believe that we have minimized the threats to the classified 
environment and national security information and are operating at an 
acceptable level of risk. The Department and NNSA senior leadership 
will continue to monitor the threats to our classified information 
technology assets along with the accompanying risks in order to make 
necessary changes and provide an appropriate level of protection.

                             URANIUM TAXES

    Question. Mr. Secretary, your budget proposes a $200 million/year 
tax on nuclear power utilities to be applied to the Uranium Enrichment 
Decommission and Decontamination Fund. This account currently enjoys a 
surplus of $4.7 billion and can sustain the ongoing cleanup for 7 years 
at current spending rates. Since these funds are not needed immediately 
and haven't been reauthorized by Congress I have to assume this is 
nothing more than a gimmick used to offset deficit spending or meet 
budget shortfalls.
    Mr. Secretary, the GAO did a study last year and found that the 
Department had a very valuable amount of unrecovered uranium sitting in 
storage at the very sites you want to cleanup. The value of these 
depleted uranium tails easily exceed the revenue raised by the tax and 
cleanup an existing liability on the Department's books.
    Will you consider the sale of the depleted uranium tails stored in 
Kentucky and Ohio as an alternative to raising taxes on utilities who 
use nuclear power and have already paid $1.5 billion in taxes already?
    Answer. The Department continues to monitor the uranium market as 
it manages various inventories of uranium declared excess to the 
Nation's national security needs. Any proceeds from any sale of the 
Department's uranium inventory will be deposited in the U.S. Treasury 
as required by the Miscellaneous Receipts Act (31 U.S.C.  3302); 
therefore, the proceeds cannot be applied toward cleanup of the gaseous 
diffusion plants.

                            CLEAN UP FUNDING

    Question. Mr. Secretary, your budget tells two distinctly different 
stories regarding the stimulus funds. When it comes to environmental 
cleanup, you justify a reduction in the fiscal year 2010 budget request 
due available stimulus funds. [sic] However, when it comes to renewable 
energy projects you have provided additional increases despite that 
program enjoying $17 billion in additional Stimulus funding.
    Can you please explain why this budget tells two completely 
different stories regarding the impact of stimulus funding on the 
budget?
    Answer. The total funding requests provided in the fiscal year 2010 
budget, in conjunction with Recovery Act funds, were carefully 
considered so as to make the biggest impact, given the status of the 
science and technology in each area.
    The fiscal year 2010 budget was formulated in light of the 
significant funding provided in the Recovery Act. Recovery funding 
enabled the Department to accelerate a number of important commitments 
in the areas of renewable energy, environmental management, grid 
modernization, carbon capture and sequestration (CCS) and basic science 
research.
    In building the fiscal year 2010 request, the administration 
adopted a thoughtful approach that considered not only whether a 
program had received Recovery Act funding, but also how those funds fit 
within our overall policy goals and priorities.
    In some cases, the Recovery Act investments are so significant that 
they amount to several years of base funding. This allowed the 
Department to make prudent use of our resources to address other high 
priorities. In other instances, like Environmental Management, the 
Recovery funding is being used on projects that meet the objectives of 
economic stimulus, but which may not ordinarily compete well against 
projects aimed at addressing the clean up of higher-risk sites. Our 
fiscal year 2010 request for EM continues to focus on high risk sites.
                                 ______
                                 
              Questions Submitted by Senator Thad Cochran

    Question. Mr. Secretary, in your budget for the Strategic Petroleum 
Reserve, you propose roughly $50 million for the purchase of a new 
cavern to replace an existing storage cavern that was said to pose ``an 
extreme environmental risk.'' My staff was informed that the Department 
purchased this cavern instead of taking advantage of salt domes already 
owned by the Department of Energy for Strategic Petroleum Reserve 
Expansion. Why?
    Answer. The Department has not purchased any new caverns for the 
Strategic Petroleum Reserve. The cavern that has been identified for 
decommissioning, Cavern 20, is located at the Bayou Choctaw site and is 
in very close proximity to the edge of the salt dome. After use during 
Hurricane Katrina in 2005, Cavern 20 experienced preferential leaching 
towards the edge of the salt dome. Continued use of the cavern presents 
a risk of major environmental danger. The fiscal year 2010 request 
proposes funding for the purchase of an existing commercial storage 
cavern that is located adjacent to the Bayou Choctaw site to replace 
the unsound cavern. It is vital for the Department to maintain its 
current inventory level and drawdown response capabilities at the Bayou 
Choctaw site because this site is the only Strategic Petroleum Reserve 
site that directly serves the refiners on the lower Mississippi River 
and refiners in the Midwest served by the Capline Distribution System. 
Crude oil releases from this site were instrumental in keeping the 
Capline system refiners supplied after the hurricanes in 2005 and 2008.
    Question. Your acting assistant Secretary for the Strategic 
Petroleum Reserve testified before the Environment and Public Works 
Committee recently about legislation sponsored by Senator Bingaman to 
create new storage for refined oil in the Strategic Petroleum Reserve. 
As you know, salt domes in my State of Mississippi were identified by 
the last administration as a possible location for the expansion of the 
Strategic Petroleum Reserve. Although funds were not included for 
expansion activities in your budget, your staff expressed interest in 
the idea of new refined oil storage capacity. The Department of Energy 
owns salt caverns in Mississippi, which could hold both refined and 
crude oil. Will Mississippi be considered as the site for this plan, 
likely to be included in the Energy package Senator Bingaman is 
planning to move through the Senate this summer?
    Answer. Although the Department has identified land for site 
development for 1 billion barrel expansion of the SPR at Richton, 
Mississippi, the Department has not acquired the land. Rather, DOE has 
completed prerequisite activities to include salt dome seismic 
analyses, site environmental surveys, and title work in preparation for 
the site acquisition. DOE has recently concluded studies for 
preparation of a Supplemental Environmental Impact Statement (SEIS) to 
find more environmentally suitable locations for the water intake 
system, the offshore brine disposal and the marine terminal in 
Pascagoula.
    The Department is currently evaluating the situation involving the 
land acquisition and the additional $31.5 million appropriated in 
fiscal year 2009 for new site expansion activities, beyond land 
acquisition.
    Question. Funding for fiscal year 2009 for the Strategic Petroleum 
Reserve included $35 million for the Richton, Mississippi site, 
contingent on a report issued by the Department within 45 days. My 
staff has contacted yours about the report. What is the status of this 
report?
    Answer. Pursuant to the fiscal year 2009 Omnibus Appropriations Act 
(Public Law 111-8), a draft report assessing the effects of expansion 
of the Reserve on the domestic petroleum market is undergoing internal 
review. We will publish and submit the final report to Congress as soon 
as the review process has been completed.
                                 ______
                                 
           Questions Submitted by Senator George V. Voinovich

    Question. Over the last several years, the Department of Energy has 
greatly increased its oversight of the contractors responsible for 
managing and operating (M&O) the national laboratories under M&O 
contracts through prescriptive directives and requirements administered 
by overlapping and often redundant oversight organizations. Currently, 
the DOE's oversight organizations employ thousands of Federal staff 
with annual budgets of $500 million. Given that no other agency expends 
this amount of resources to oversee contractors who were supposedly 
engaged to apply best private-sector practices to operations, do you 
think the level of regulatory oversight at the Department's national 
laboratories has gotten out of control and hampers their ability to 
provide solutions to our Nation's pressing energy needs?
    Answer. As Secretary of Energy, I am firmly committed to improving 
efficiency at our Laboratories. There is much that the Department can 
and will do to enhance our laboratories' ability to deliver on the DOE 
missions. Significant improvement can be made with a concerted effort. 
Further, we will also review the use of independent certifications (ISO 
9000 and 14000, DOE Voluntary Protection Programs, etc.) as part of our 
expectations and our strategy for overseeing our contractors' business 
and operations systems and processes. Finally, we will consider the 
circumstances under which external regulation may be appropriate.
    Question. The Government-owned, contractor-operated (GOCO) model 
for laboratory management was originally designed to bring the best 
possible scientific and management talent to the laboratories and to 
allow them to apply the best private-sector business practices, thus 
maximizing their flexibility and efficiency. However, as laboratory 
resources are increasingly being redirected from performing R&D to 
demonstrating compliance with extremely prescriptive DOE work 
requirements, the argument for rethinking DOE's GOCO model is 
strengthened. What is your vision of the GOCO management relationship 
between DOE and its contractors?
    Answer. In my view, the proper relationship between the Department 
and its M&O contractors is one that focuses on clear definitions of 
performance expectations and outcomes and on holding our contractors 
accountable for achieving those outcomes.
    The success of the relationship between DOE and its M&O contractors 
depends on a clear and consistently-applied understanding of the roles 
and responsibilities of each party. The Department should specify what 
goals and requirements the contractors must meet and then hold the 
contractors accountable for meeting these goals. The contractors should 
determine how to meet those contract goals and requirements and apply 
best business practices.
    Question. How do you explain the current role of the local DOE 
site/field offices, and do you see this role changing over time?
    Answer. The current role of the local DOE site/field offices is to 
provide contractual support and oversight of the Department's national 
laboratories and other facilities that are Government-owned and 
contractor operated (GOCO). As you know, I am committed to improving 
the overall management of the Department, to make it more efficient, 
responsive, and economic in meeting our missions and better serving the 
American people. Toward this end I have already begun the process of 
reviewing the Department's current management structures, processes, 
and procedures, and would expect this to continue for some time.
    Question. In terms of execution of civilian R&D programs, how would 
you categorize the differences between the DOE Office of Science, 
National Science Foundation, and National Institute of Health?
    Answer. DOE is a mission agency with responsibilities in energy, 
environment, national security, and discovery science. The DOE Office 
of Science supports scientific research within this mission at over 300 
universities and the national laboratories. The Office of Science also 
plans, builds, and operates scientific user facilities for the 
scientific community. These facilities are a significant pillar of the 
U.S. scientific enterprise. The DOE Office of Science is the steward 
for 10 national laboratories, and it is the primary Federal supporter 
of basic research in service of the energy mission. The programs of the 
Office of Science are carefully planned and focused in areas of 
importance to advance the DOE mission.
    NIH is the primary Federal agency for conducting and supporting 
medical research. It is part of the Department of Health and Human 
Services, the principal agency for protecting the health of all 
Americans and providing essential human services. NIH employs 
intramural researchers and also funds extramural researchers. The DOE 
Office of Science generally does not directly fund medical science and 
does not have Federal intramural researchers.
    The National Science Foundation (NSF) aims ``to promote the 
progress of science; to advance the national health, prosperity, and 
welfare; to secure the national defense. . . .'' The NSF supports all 
fields of fundamental science and engineering, except for medical 
sciences, and also supports the social sciences.
    NSF is proposal-driven and funds science independent of the field 
or application of that science; in contrast the DOE Office of Science 
is mission-driven, supporting science serving the DOE missions of 
energy, environment, and national security.
    A cornerstone of Office of Science funding is a rigorous peer 
review process, much like NIH and NSF.
    Question. Although our national laboratory system includes what may 
be the largest and most impressive collection of scientific facilities 
and talent in the world, the American tax payer does not receive the 
maximum benefit from these investments because current DOE policy 
prevents labs from partnering with private companies on research 
proposals from Federal agencies. Would you support a change in current 
DOE policy to authorize national laboratories, on a non-exclusive 
basis, to partner with private industry on research request for 
proposals (RFPs)?
    Answer. Senator Voinovich, you raise an interesting issue as to how 
to best utilize our national laboratories, which for the most part are 
Government-owned contractor-operated and are Federally Funded Research 
and Development Centers (FFRDCs). Our national laboratories partner 
extensively with private industry through, for example, the Work for 
Others program, Cooperative Research and Development Agreements, 
licensing arrangements and user agreements. With respect to responding 
to RFPs, however, the Federal Acquisition Regulation, which applies on 
a Government-wide basis, requires that agencies sponsoring FFRDCs 
include in the sponsoring agreement a prohibition against the FFRDC's 
competing with any non-FFRDC concern in response to a Federal agency 
RFP. DOE's implementation of that requirement is set out in DOE Order 
481.1C stating that FFRDCs may not respond to RFPs that involve head-
to-head competition. This preclusion is based partly on the sanctioned 
special access to Government information that FFRDCs have that could 
put commercial competitors at a disadvantage. The Order goes on to 
permit, under certain circumstances, FFRDCs to respond to Broad Agency 
Announcements, financial assistance solicitations, Program Research and 
Development Announcements, and similar solicitations which do not 
result in head-to-head competition. I believe that the DOE should look 
carefully at improving opportunities for private industry to partner 
with DOE national laboratories.
    Question. Has the Department of Energy determined which energy 
sources will provide the most electricity with the lowest carbon-
emissions and smallest lifecycle footprint on the environment as a 
whole, including raw materials and land usage? Has the DOE done a 
comprehensive study to determine the effectiveness of U.S. energy 
subsidies, and if not, has the DOE determined which energy subsidies, 
if any, would result in the best return on investment for tax payers 
while meeting the President's GHG emissions targets?
    Answer. No, but the Department of Energy is continuing to develop 
and evaluate a portfolio of technologies with the lowest life-cycle 
costs and carbon footprint to meet the Nation's growing electricity 
demand.
    Numerous Federal programs operate today to help accelerate the 
deployment of greenhouse gas intensity-reducing technologies by 
providing various financial incentives, including direct subsidies. 
While these financial incentives are expected to reduce GHG emissions, 
they also incur costs to the U.S. Government. DOE is evaluating the 
economic and environmental effectiveness of energy subsidies. The 
Energy Information Administration did recently complete a study, 
``Federal Financial Interventions and Subsidies in Energy Markets,'' 
but this study does not calculate the return on investment in terms of 
GHG emissions reduction. The executive summary is available at: http://
www.eia.doe.gov/oiaf/servicerpt/subsidy2/pdf/execsum.pdf.
    Question. What is the Department of Energy doing to help expand the 
number of nuclear power plants we have in the United States and reduce 
our dependence on foreign energy sources? Will additional loan 
guarantee authority be given to allow industry to move forward?
    Answer. The Nuclear Power 2010 (NP2010) program was established to 
address the issues limiting deployment of new nuclear plants in the 
United States. The primary goal of the NP2010 program was to 
demonstrate the streamlined Federal regulatory processes governing the 
siting and construction of new, standardized nuclear plant designs. The 
NP2010 program has successfully met its objectives, and we await 
industry decisions to build the first new nuclear plants in more than 
30 years. The NP2010 program is requesting $20.0 million in fiscal year 
2010 to complete support of the NuStart New Nuclear Plant Licensing 
Demonstration project. This industry cost-shared project includes 
interactions with the Nuclear Regulatory Commission (NRC) to obtain the 
NuStart Construction and Operating License for the AP1000 advanced 
light water reactor design including meetings with the Advisory 
Committee on Reactor Safety, issuance of Final Safety Evaluation 
Reports and Final Environmental Impact Statements and initiation of 
hearings by the Advisory Committee on Reactor Safeguards.
    Taken together, the NP2010 program and loan guarantees for nuclear 
power projects are designed to address the technical, regulatory and 
financial risks associated with deploying new nuclear plants. DOE is 
not seeking additional loan guarantee authority or additional 
appropriations for credit subsidy costs in fiscal year 2010.
    Question. What initiatives and programs is the Department of Energy 
planning to ensure we have the technical workforce required to 
maintain, build and service our Nation's nuclear power plants in a safe 
and efficient manner?
    Answer. The Office of Nuclear Energy will provide $2.9 million in 
undergraduate scholarships and graduate fellowships to high-quality 
undergraduate and graduate students going into nuclear science and 
engineering disciplines at universities and colleges located in the 
United States. The Office of Nuclear Energy also has recommended that 
29 universities and colleges receive a total of $6 million in grants 
for new equipment and instrumentation for their existing research 
reactors, for other specialized nuclear science and engineering 
facilities, and to establish classrooms and laboratories. These grants 
are designed to enhance the universities' and colleges' nuclear energy 
research and development capabilities to educate the next generation of 
nuclear engineers and scientists.
    Working with industry, the Office of Nuclear Energy will soon begin 
activities to more thoroughly analyze total workforce needs to support 
continued safe and reliable operation of the existing nuclear fleet and 
construction and operation of the next generation of nuclear power 
plants in the United States. Finally, the Department will continue to 
look for partnership opportunities with industry groups, academia, and 
other Government agencies to ensure an adequate, highly skilled 
workforce is available to ensure continued safe and reliable nuclear 
power operations.

                          SUBCOMMITTEE RECESS

    Senator Dorgan. Thank you for being with us this morning. 
Our subcommittee will want to work closely with you and with 
your staff in the Department of Energy as we work through the 
markup of an appropriations bill going forward in the coming 
fiscal year. This hearing is recessed.
    [Whereupon, at 11:54 a.m., Tuesday, May 19, the 
subcommittee was recessed, to reconvene subject to the call of 
the Chair.]
