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



 
    ENERGY AND WATER DEVELOPMENT APPROPRIATIONS FOR FISCAL YEAR 2011

                              ----------                              


                        WEDNESDAY, MARCH 4, 2010

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 10 a.m., in room SD-192, Dirksen 
Senate Office Building, Hon. Byron L. Dorgan (chairman) 
presiding.
    Present: Senators Dorgan, Murray, Landrieu, Reed, Tester, 
Bennett, Bond, and Alexander.

                          DEPARTMENT OF ENERGY

STATEMENT OF HON. STEVEN CHU, SECRETARY


               opening statement of senator byron dorgan


    Senator Dorgan. We are going to call the hearing to order. 
This is a hearing of the Senate Appropriations Subcommittee on 
Energy and Water Development.
    Mr. Secretary, welcome to you.
    The hearing today is to take testimony from Secretary Chu 
on the Department of Energy's fiscal year 2011 budget request.
    We will have other colleagues who will be joining us 
momentarily.
    And I wanted to mention at the start of the hearing that I 
am necessarily going to have to leave. The President is signing 
a piece of legislation that I authored at the White House. So I 
will be leaving in about an hour, but we will have someone take 
the chair at that point. Between now and then, we will have a 
discussion about the budget request.
    I would like to note that we will have Administrator 
D'Agostino before the subcommittee on March 10 to discuss the 
NNSA fiscal year 2011 budget request. That does not mean that 
we cannot ask about that today, but because he is going to be 
here, I just want people to be aware that we will have an 
opportunity to discuss that budget in some detail in 2 weeks' 
time.
    Further, on March 11, we will have a hearing with the Corps 
of Engineers and the Bureau of Reclamation on the fiscal year 
2011 budget request for water agencies, another very important 
hearing.
    Today's hearing and next week's hearing on the NNSA budget 
represent I think the good news for the subcommittee. Next 
Thursday, when we hear from the Corps of Engineers and the 
Bureau of Reclamation, we will be discussing budget cuts that 
exceed $500 million. That is not such good news if one believes 
water projects are both important investments in our country's 
infrastructure and job-creation and necessary. We are going to 
have a challenge of reconciling the overall budget request to 
the subcommittee because we are not going to have a half-a-
billion-dollar cut for water projects when this subcommittee 
completes its work. I would hope that would be the case.
    The budget request of $28.9 billion for the Energy 
Department is a generous 6 percent increase over the enacted 
fiscal year 2010 bill. Much of that increase is within the 
National Nuclear Security Administration's budget, which is up 
about 13 percent. Excluding NNSA, the remaining DOE programs 
are collectively up about 3 percent.
    I am pleased that the administration agrees that energy 
research is the key to maintaining our competitiveness 
internationally, as well as increasing our energy security. We 
need to continue to develop the technology that will allow us 
to harvest usable energy from the wind and the sun, even as we 
pursue responsible oil and gas development and ways to reduce 
carbon emitted when we use coal.
    The research that is required to get us to a cleaner energy 
future happens in this Department, and I am excited about the 
work that is coming out of the Department, Mr. Secretary.
    I do have some concerns and questions about the budget 
request, obviously, and we will talk about that. The 
significant priority on funding within the EERE is where 
programs are up collectively about $400 million. Only two 
programs are down from last year. One is hydrogen and the other 
is water power, and I have some concern, again, about the 
hydrogen programs which I feel we should continue. I know that 
you have continued those programs in this budget at a lower 
rate.
    The Office of Science also sees a 6 percent, or $295 
million, increase in its program funding, and there are new 
initiatives in science, including a proposed battery hub and a 
new program on combustion engines.
    Energy Frontier Research Centers and a fellowship program 
are proposed for expansion. Both of those programs have only 
been up for 2 years at this point. So they are now proposed to 
be expanded.
    The ARPA-E program is proposed at $300 million, and I think 
that is an exciting program. I know that there was a 
significant national gathering, Mr. Secretary, Monday and 
Tuesday of this week. I am told it was very successful, but I 
am a big supporter of this program and think it holds real 
promise in its approach to back high-risk, but high-reward 
technology in energy.
    Nuclear energy sees a significant increase with over $150 
million in new initiatives.
    I am concerned that we have a lot of new initiatives that 
we are proposing very significant increases to. I do not know 
that we know specifically how some of these new initiatives are 
working yet before we proceed with very large increases. We 
would like to see longer-term spending plans for some of these 
initiatives. NNSA, I might say, gives us the 5-year spending 
plan. It would be nice to see that in some of the rest of the 
areas.
    One of the concerns I have in the budget is--and this will 
not be a surprise to you, Secretary Chu, is regarding fossil 
energy. Fossil energy is proposed for an $86 million decrease, 
while other accounts receive a substantial increase. Coal 
provides about 50 percent of our electricity generated today in 
our country, and I believe that the use of coal, natural gas, 
and oil will continue to be used for decades to come in this 
country. So we have to find the means to use our fossil fuels 
and develop the technologies, put a price on carbon, and do so 
in a way that helps us mitigate greenhouse gas emissions. All 
of that is critically important.
    But I am concerned because the fossil energy account does 
not show me new, substantive, elements in the budget to address 
what I think is a critical need as well. I am a big fan of all 
the renewables and this search for new technology and new 
science, but I think it is important to keep our eye on the 
ball with respect to fossil energy, which we are going to 
continue to use.
    I have said before, Secretary Chu, you are a creative and 
innovative person who has demonstrated great skill in a lot of 
areas and I think much of that creativity and innovation is 
something we can see in your budget request. I am really 
pleased that you are where you are and while we will have some 
disagreements on the broader issues, I think that this budget 
request moves us down the road in some very important areas as 
well in a constructive way.
    Let me call on Senator Bennett for an opening statement.


             opening statement of senator robert f. bennett


    Senator Bennett. Thank you very much, Mr. Chairman.
    Secretary Chu, we are delighted to have you here, along 
with your team.
    I find myself in agreement with many of things the chairman 
has highlighted. The NNSA budget is something we will discuss 
at another hearing. So I will not get into that.
    But I agree with the chairman that energy research is 
something that we clearly need to do in a wide variety of 
areas, and investments in the energy sector are some of the 
most important we can make.
    Now, I am concerned with the priorities that I see in the 
budget with respect to energy research, and let us talk about 
some of those concerns.
    Talk about unobligated balances. I am assuming the budget 
request was considered without taking into account what was 
funding from the stimulus bill, or the Recovery Act. Over a 
year ago, with a promise of creating thousands of jobs and 
increasing energy efficiency, reducing the nuclear waste 
footprint--and these goals are far from being met. The 
Department of Energy is sitting on a tremendous balance of 
unspent funds. About $34 billion of the $36.7 billion 
appropriated remains unspent, 93 percent, as well as over $1 
billion in funds from prior year balances in numerous programs. 
The money seems to be piling up down there from prior 
appropriations bills.
    As one example, with over $5 billion available in 
weatherization funds, I cannot understand why your budget would 
include a 43 percent increase in the amount provided in fiscal 
year 2010 for this program, especially when the Department's 
own estimates indicate that the stimulus funds will not be 
spent until well in 2012.
    Now, another aspect that I find troubling is the same one 
the chairman has referred to, to slash the fossil energy R&D 
program by more than 20 percent. Here you have got all of this 
money unspent in this one area and then you are saying, well, 
we are going to cut fossil energy R&D by more than 20 percent, 
and this includes eliminating the natural gas technology's 
account and the unconventional fossil energy's technology line 
that we in this subcommittee included in last year's bill.
    So I am glad the chairman raised this as an issue. Fossil 
energy and particularly natural gas is the only energy that we 
have that will bridge the gap between today and the clean 
energy future that we are hoping for in, roughly, 30 to 40 
years. And that is a significant timeframe, and to be cutting 
back on the fuel that will allow us to deal with that timeframe 
is something I think we need to discuss.
    Now, if I can be specific with respect to my State on this 
question of fossil fuel research, you are halting research on 
unconventional resources in eastern Utah, southern Wyoming, and 
western Colorado. Every energy expert says that in that pool of 
shale oil, there is more oil than there is in Saudi Arabia, but 
it needs some research to figure out how to get it out. But it 
will remain virtually untapped if this research is not 
performed.
    Another area that concerned me is the sizable reduction to 
hydropower. Solar and wind receive unsustainable increases. You 
cannot spend that much money and you want to tax utilities to 
generate $200 million. Well, that was a non-starter last year. 
I think it will be a non-starter again this year. It leaves a 
$200 million hole in your budget.
    While I am in the West, let us talk about uranium sales. I 
was very concerned that the Department unilaterally decided to 
drop some of its inventory of uranium on the market this year, 
bartering uranium in exchange for cleanup work at the 
Portsmouth, Ohio site. Now, obviously, this caused great 
consternation with uranium miners due to a potential for steep 
drops in the price of uranium, and the spots sales approach is 
a bad deal for the taxpayer in my view. The Department is 
proposing increased appropriations for decontamination and 
decommissioning work at Portsmouth in fiscal year 2011 in lieu 
of continuing the bartering arrangement.
    Now, I understand the Department has not stated with 
certainty that it will discontinue the practice of dumping 
uranium on the market, and certainty is what the uranium 
industry or any other industry needs. Uncertainty always causes 
difficulties and challenges, and I hope we can have an 
opportunity to work together on this problem as we move 
forward.
    Now, on a more positive note, I think you are on the right 
track with your 5 percent increase in nuclear energy and the 
tripling of the loan guarantee authority for nuclear plant 
construction. The demand for loan guarantees in nuclear 
technology outstrips the current loan authority. It is going to 
be critical in jump starting the nuclear industry, and I think 
that is a key part of the path to energy that does not have 
greenhouse gas emissions.
    Now, while I am glad to see the increase and the tripling 
of the loan guarantee, the loan guarantee program has been 
mired in problems. And in the 5 years since it was authorized--
and that precedes your entry into the Department--only one 
guarantee has been issued. Five conditional commitments have 
been made, and it was the Department's intention to have 21 
commitments by the end of 2009. According to GAO, the program 
has been run in an ad hoc manner without any transparency to 
the applicants and the situation where there are different 
rules applied in different instances.
    And we would like to know if you have the tools in hand to 
make the program a success or whether you need additional 
legislative fixes. If you do need additional legislative fixes, 
let us know because I am supportive of providing the additional 
guarantee and would love to see demonstrable improvements to 
the program.
    Contract administration and project management, with over 
90 percent of your budget spent on contracts, improving 
contract administration, obviously, has to be a very high level 
issue. And DOE contract management has been on the GAO high 
risk list of programs ripe for fraud, waste, and abuse since 
1990. So again, this predates you and is not something that we 
can lay at your feet, but it is something that you inherited. 
And strengthening contract management includes the development 
of high quality cost estimates early on. The surprise we 
received a year ago when we held these hearings, Mr. Chairman, 
about enormous pension liabilities seem as illustrative of the 
problem you have when contracts are not managed properly.
    And I am glad to hear that the Department is beginning to 
get its arms around this problem, but we still do not know what 
the pension liability is going to be for this year or for next 
or how the Department plans to get this under control in the 
future. And the amount to cover the shortfall is potentially in 
the hundreds of millions of dollars. So this is something that 
we are going to follow closely.
    Now, to close, I have a bittersweet example of something I 
am concerned about. The Moab tailings sites in my home State 
have met all of its milestones. It has got a million tons of 
tailings shipped and disposed of. It is coming in under budget 
and ahead of schedule. And the project is slated to be 
decreased to $8 million, or 20 percent, in this budget. And I 
say, wait a minute. Is this a good deed that is going 
unpunished as they are moving these tailings in a very 
expeditious way and get rewarded for that by having a cut in 
the budget and a suggestion that they will slow down the 
excellent progress that they have established?
    So, on that parochial note Mr. Chairman, thank you very 
much for the opportunity to comment.
    Senator Dorgan. Senator Bennett, thank you very much.
    Unless there is objection, I am going to welcome Secretary 
Chu's testimony, and then we will have robust rounds of 
questions. Senator Reed, does that work for you?
    Senator Reed. All right.
    Senator Dorgan. All right, and Senator Tester.
    Senator Tester. Okay.
    Senator Dorgan. Mr. Secretary, thank you very much and why 
do you not proceed? Your entire statement will be made a part 
of the permanent record and we would ask that you summarize. 
Thank you very much.


                      statement of hon. steven chu


    Secretary Chu. Thank you, Chairman Dorgan, Ranking Member 
Bennett. I hope to respond to your questions later, but let me 
first go through my remarks.
    Senator Dorgan. You may respond as you wish in your opening 
statement or as an adjunct to your opening statement as well.
    Secretary Chu. Well, if there is time.
    Chairman Dorgan, Ranking Member Bennett, members of the 
subcommittee, I thank you for the opportunity to be before you 
today to talk about the President's budget request.
    President Obama has stated that ``the Nation that leads the 
world in creating new sources of clean energy will be the 
Nation that leads the 21st century economy.'' And I share this 
view.
    The President's 2011 budget request for $28.4 billion for 
the Department of Energy will help position the United States 
to be a global leader in the new energy economy. The budget 
request makes much-needed investments to harness the power of 
American ingenuity. This request will create clean energy jobs, 
expand the frontiers of science, reduce nuclear dangers, and 
help curb the carbon pollution that threatens our planet.
    The President's budget request includes an investment of 
$2.4 billion in energy efficiency and renewable sources of 
energy. It also proposes innovative energy efficiency and 
renewable energy projects through $500 million in credit 
subsidy that will support $3 billion to $5 billion in lending. 
It expands the Advanced Manufacturing Tax Credit by $5 billion, 
a program that was oversubscribed by three to one, to help 
build a robust domestic manufacturing capacity for clean energy 
technologies. Through this budget, we will increase research, 
demonstration, and deployment of wind, solar, and geothermal 
energies; make buildings and homes more efficient; develop 
energy-efficient vehicles; and pursue carbon capture and 
sequestration.
    Nuclear energy must also be part of our clean energy mix. 
Our budget request includes an additional $36 billion in loan 
guarantee authority for the nuclear power sector, as well as 
$495 million for nuclear energy research and development. On 
February 16th, President Obama announced conditional 
commitments for more than $8 billion in loan guarantees for 
what will be the first nuclear powerplant to break ground in 
nearly three decades.
    We have many technologies in hand today to begin the 
transition to a low-carbon economy, but we will need 
breakthroughs and better technologies to meet our long-term 
goals. The budget request invests in basic and applied research 
and puts us on a path to doubling funding for science, a key 
presidential priority.
    The budget request supports the Department's three new 
complementary approaches to marshalling the Nation's brightest 
minds to accelerate energy breakthroughs.
    We will continue funding the three Energy Innovation Hubs 
introduced in 2010. In addition, we are proposing a new hub to 
dramatically improve batteries and energy storage.
    The Energy Frontier Research Centers program will be 
expanded to capture new and emerging opportunities.
    And the fiscal year 2011 budget request includes $300 
million to pursue potentially transformative technologies 
through the Advanced Research Projects Agency-Energy.
    We are also requesting $55 million to start RE-ENERGYSE 
initiatives to support K through 20-plus science and 
engineering education.
    In addition to the health of our economy and our planet, 
the Department of Energy is focused on the safety and security 
of our people. Last April in Prague, President Obama outlined 
an ambitious agenda to address the greatest threat to global 
security, the danger of terrorists getting their hands on 
nuclear weapons or the material to build them. The Department 
is requesting a significant increase, more than $550 million in 
new funding, for the NNSA Defense Nuclear Nonproliferation 
program to help meet the President's goals of securing all 
vulnerable nuclear materials around the world in 4 years.
    The President has also made clear that as long as nuclear 
weapons continue to exist, it is essential we ensure the 
safety, security, and effectiveness of our nuclear stockpile. 
With the $7 billion in funds we have requested, we can upgrade 
our infrastructure that has been allowed to decay in the past 
decade, support the work of our national labs, and recruit the 
skilled workforce we need.
    The budget also protects public health and safety by 
cleaning up the environmental legacy of the Nation's nuclear 
weapons program. In 2010, the Department will discontinue its 
application to the U.S. Nuclear Regulatory Commission for a 
license to construct a high-level waste geological repository 
at Yucca Mountain.
    To deal with our nuclear waste management needs, the 
administration has announced an independent, bipartisan 
commission, co-chaired by General Brent Scowcroft and 
Congressman Lee Hamilton, to conduct a comprehensive review of 
the back end of the fuel cycle and to provide recommendations 
for a safe, long-term solution.
    Building a clean energy future will not be easy, but it is 
necessary for our economy and our security. As a scientist, I 
am optimistic. I believe we can meet the challenge and lead the 
world in the 21st century.


                           prepared statement


    President Obama and I look forward to working with this 
subcommittee and this Congress to build a stronger, safer, more 
prosperous future. Thank you. I am pleased to take questions at 
this time.
    [The statement follows:]
                 Prepared Statement of Hon. Steven Chu
    Chairman Dorgan, Ranking Member Bennett, and members of the 
subcommittee, thank you for the opportunity to appear before you today 
to discuss the President's fiscal year 2011 budget request for the 
Department of Energy.
    President Obama has stated, ``The nation that leads the world in 
creating new sources of clean energy will be the nation that leads the 
21st century global economy.'' I fervently share this view. The 
President's fiscal year 2011 budget request of $28.4 billion will help 
position the United States to be the global leader in the new energy 
economy. The budget request makes much-needed investments to harness 
the power of American ingenuity. This request will create clean energy 
jobs, expand the frontiers of science, reduce nuclear dangers, and help 
curb the carbon pollution that threatens our planet. As part of this 
administration's commitment to fiscal responsibility, the Department of 
Energy is also proposing several program reductions and terminations.
                 american recovery and reinvestment act
    The fiscal year 2011 budget request builds on the investments in 
the American Recovery and Reinvestment Act. Through the $36.7 billion 
the Department received from the Recovery Act, we are putting Americans 
to work, while helping to build a clean energy economy, spur energy 
innovation, and reduce our dependence on oil. We've begun to make our 
homes and offices more energy efficient, modernize our grid, and invest 
in key renewable energy projects. Getting this money out the door 
quickly, carefully, and transparently has been and will continue to be 
a top priority for me.
         fiscal year 2011 budget supports strategic priorities
    To continue the progress we have made, the fiscal year 2011 budget 
request supports the Department's strategic priorities of:
  --Transitioning to a low-carbon economy by developing and deploying 
        clean and efficient energy technologies, increasing generation 
        capacity and improving our transmission capabilities;
  --Investing in scientific discovery and innovation to find solutions 
        to pressing energy challenges and maintain American economic 
        competitiveness; and
  --Enhancing national security by ensuring the safety, security and 
        effectiveness of the nuclear stockpile without testing. The 
        budget request also includes funds to work with our 
        international partners to secure vulnerable nuclear material 
        around the world within 4 years, and advance our nuclear legacy 
        cleanup.
    These strategic priorities will be enabled by a continued 
commitment to improving the management and fiscal performance of the 
Department.
                                 energy
    To transition to a low-carbon future, we must change the way we 
generate and use energy. The President's budget request invests in 
clean energy priorities, including an investment of $2.4 billion in 
energy efficiency and renewable sources of energy. It also promotes 
innovative energy efficiency and renewable energy projects through $500 
million in credit subsidy that will support $3 to $5 billion in 
lending. It expands the Advanced Manufacturing Tax Credit by $5 billion 
to help build a robust domestic manufacturing capacity for clean energy 
technologies. Through this budget, we will increase research, 
demonstration, and deployment of wind, solar and geothermal energies; 
make buildings and homes more efficient; develop energy efficient 
vehicles; and pursue carbon capture and sequestration.
    Nuclear energy must also be a part of our clean energy mix. During 
his State of the Union address, President Obama said, ``To create more 
of these clean energy jobs, we need more production, more efficiency, 
more incentives. And that means building a new generation of safe, 
clean nuclear power plants in this country.'' The President and I are 
committed to restarting our domestic nuclear industry. Our budget 
request includes an additional $36 billion in loan guarantee authority 
for the nuclear power sector to help construct the first new nuclear 
plants in decades, as well as $495 million for research and development 
to support the competitiveness, safety and proliferation resistance of 
nuclear energy in the United States and abroad. On February 16, 
President Obama announced conditional commitments for more than $8 
billion in loan guarantees for what will be the first U.S. nuclear 
power plant to break ground in nearly three decades.
                               innovation
    We have many technologies in hand today to begin the transition to 
a low-carbon economy, but we will need breakthroughs and better 
technologies to meet our long-term goals. The budget request invests in 
basic and applied research and puts us on the path to doubling funding 
for science, a key presidential priority. We are also requesting $55 
million to start the RE-ENERGYSE initiative to help educate the next 
generation of scientists and engineers.
    The budget request also supports the Department's three new, 
complementary approaches to marshalling the Nation's brightest minds to 
accelerate energy breakthroughs.
    The first approach is the Energy Innovation Hubs. The Hubs are 
multidisciplinary, goal-oriented, and will be managed by top teams of 
scientists and engineers with enough resources and authority to move 
quickly in response to new developments. They are to be modeled after 
laboratories such as MIT's Radiation Laboratory, which developed radar 
during World War II, and Bell Laboratories when it invented and 
developed the transistor. Ideally, this work will be conducted under 
one roof. The Department will continue funding the three Energy 
Innovation Hubs introduced in fiscal year 2010. In addition, we are 
proposing a new Hub to dramatically improve batteries and energy 
storage.
    The second approach is the Energy Frontier Research Centers. The 
EFRCs are mainly university-based, problem-oriented research. We have 
identified key scientific barriers to energy breakthroughs, and we 
believe we can clear these roadblocks faster by linking together small 
groups of researchers across departments, schools, and institutions. 
The Department proposes expanding the Energy Frontier Research Centers 
to capture emerging opportunities in new materials and basic research 
for energy needs.
    The third funding approach is the Advanced Research Projects 
Agency-Energy (ARPA-E). ARPA-E is technology-oriented. We are seeking 
the boldest and best ideas for potentially transformative energy 
technologies and funding them to see if they work. The fiscal year 2011 
budget request includes $300 million for ARPA-E. ARPA-E is also 
dedicated to the market adoption of these new technologies. This week, 
ARPA-E sponsored a very successful conference here in Washington to 
bring together our Nation's energy innovators. I want to thank Chairman 
Dorgan for attending this event.
                                security
    In addition to the health of our economy and our planet, the 
Department of Energy is focused on the safety and security of our 
people. Last April in Prague, President Obama outlined an ambitious 
agenda to address the greatest threat to global security--the danger of 
terrorists getting their hands on nuclear weapons or the material to 
build them. The Department is requesting a significant increase in the 
budget--more than $550 million in new funding--for the NNSA Defense 
Nuclear Nonproliferation program to help meet the President's goal of 
securing all vulnerable nuclear materials around the world in 4 years.
    The President has also made clear that, as long as nuclear weapons 
continue to exist, it is essential that we ensure the safety, security 
and effectiveness of our nuclear stockpile. With the $7 billion in 
funds we have requested, we can upgrade our infrastructure that has 
been allowed to decay in the past decade, support the cutting-edge work 
of our National Labs, and recruit the skilled workforce we need today 
and in the future. Over the next 5 years, we intend to boost this 
funding by more than $5 billion. Even in a time of tough budget 
decisions, we must make this investment for the sake of our security.
    The budget request also protects public health and safety by 
cleaning up the environmental legacy of the Nation's nuclear weapons 
program. In 2010 the Department will discontinue its application to the 
U.S. Nuclear Regulatory Commission for a license to construct a high-
level waste geologic repository at Yucca Mountain.
    Both the President and I have made clear that Yucca Mountain is not 
an option. To deal with our nuclear waste management needs, the 
administration has brought together a range of experts to conduct a 
comprehensive review of the back end of the fuel cycle. The Blue Ribbon 
Commission announced recently, and co-chaired by General Brent 
Scowcroft and Congressman Lee Hamilton, will provide recommendations 
for developing a safe, long-term solution to managing the Nation's used 
nuclear fuel and its nuclear waste.
    As part of our comprehensive strategy to restart the nuclear 
industry, we also propose breaking down artificial stovepipes and 
merging the Office of Civilian Radioactive Waste Management into the 
Office of Nuclear Energy.
                               management
    Finally, in order to transform the way Americans generate and use 
energy, we must transform the Department itself. As part of the Obama 
administration's reform agenda, the budget request includes $2 million 
to establish a new Management Reform initiative to provide strategic 
direction, coordination and oversight of reform initiatives. This 
initiative will report directly to me and will receive close personal 
attention. We made important reforms when we began to implement the 
Recovery Act, and now we need to institutionalize those reforms and 
apply them across the Department.
    Additionally, we are committed to being good stewards of the 
taxpayers' money. As we developed the budget, we looked to eliminate or 
reduce programs where we could. For example, we eliminated more than 
$2.7 billion in tax subsidies for oil, coal and gas industries. This 
step is estimated to generate more than $38.8 billion in revenue for 
the Federal Government over the next 10 years.
    Building a clean energy future won't be easy, but it is necessary 
for our economy and our security. As a scientist, I am an optimist, and 
I believe that we can meet this challenge and lead the world in the 
21st century.
     highlights of the fiscal year 2011 department of energy budget
    The Department's fiscal year 2011 budget request of $28.4 billion, 
a 6.8 percent or $1.8 billion increase from fiscal year 2010, supports 
the President's commitment to respond in a considered, yet expeditious 
manner to the challenges of rebuilding the economy, maintaining nuclear 
deterrence, securing nuclear materials, improving energy efficiency, 
incentivizing production of renewable energy, and curbing greenhouse 
gas emissions that contribute to climate change. Together with the 
American Recovery and Reinvestment Act of 2009 (Recovery Act) and 
fiscal year 2010 budget, the fiscal year 2011 budget request supports 
investment for a multi-year effort to address these interconnected 
challenges.
    The fiscal year 2011 budget builds on the $36.7 billion in Recovery 
Act funding. By the end of fiscal year 2010, the Department expects to 
obligate 100 percent and outlay roughly 35-40 percent of Recovery Act 
funds. In developing the fiscal year 2011 budget request, the 
Department has taken these investments into account. Recovery Act 
investments in energy conservation and renewable energy sources ($16.8 
billion), environmental management ($6 billion), funds supporting loan 
guarantees for renewable energy and electric power transmission 
projects ($4 billion), grid modernization ($4.5 billion), carbon 
capture and sequestration ($3.4 billion), basic science research ($1.6 
billion), and the establishment of the Advanced Research Projects 
Agency--Energy ($0.4 billion) will continue to strengthen the economy 
by providing much-needed investment, by saving or creating tens of 
thousands of direct jobs, cutting carbon emissions, and reducing U.S. 
dependence on oil.
    The President's fiscal year 2011 budget supports our three 
strategic priorities:
  --Innovation.--Investing in science, discovery and innovation to 
        provide solutions to pressing energy challenges
  --Energy.--Providing clean, secure energy and promoting economic 
        prosperity through energy efficiency and domestic forms of 
        energy
  --Security.--Safeguarding nuclear and radiological materials, 
        advancing responsible legacy cleanup, and maintaining nuclear 
        deterrence
    These strategic priorities will be enabled by a continued 
commitment to management excellence:
  --Management.--Transforming the culture of the Department with a 
        results-oriented approach
Innovation--Investing in Science, Discovery and Innovation to Provide 
        Solutions to Pressing Energy Challenges
    As President Obama made clear in his remarks to the National 
Academy of Sciences in April 2009, the public sector must invest in 
research and innovation not only because the private sector is 
sometimes reluctant to take large risks, but because the rewards will 
be broadly shared across the economy. Leading requires assembling a 
critical mass of the best scientists and engineers to engage in 
mission-oriented, cross-disciplinary approaches to addressing current 
and future energy challenges. To develop clean energy solutions and 
maintain nuclear security, the Department must cultivate the science, 
technology, engineering, and mathematics workforce of the next 
generation. The fiscal year 2011 budget request of $55 million for RE-
ENERGYSE (Regaining our ENERGY Science and Engineering Edge) supports 
K-20+ science and engineering education.
    With every initiative the Department undertakes, sound science must 
be at the core. In fiscal year 2011 the Department will increasingly 
emphasize cross-cutting initiatives to link science throughout the 
Department, specifically with energy and national security programs. 
These cross-cutting initiatives will enhance science capabilities to 
create knowledge and innovative technologies that can be brought to 
bear on national energy and security issues, leverage world-class 
science and engineering expertise to establish global leadership as 
clean energy innovators, and employ use-inspired research to reduce the 
cost and time to bring technologies to market at scale. The Department 
believes that it will deliver solutions more quickly and efficiently 
through our efforts to break down the traditional stovepipes and 
operate in a more integrated and coordinated manner. The fiscal year 
2011 budget continues to address the President's priorities in an 
integrated and efficient manner, and to deliver results for the 
American taxpayer.
    The Department continues its strong commitment to basic research 
and supports the President's Plan for Science and Innovation by 
requesting funding for the Office of Science at $5.1 billion, a 4.4 
percent or $218 million increase from fiscal year 2010. The fiscal year 
2011 budget request will support the training of students and 
researchers in fields critical to national competitiveness and 
innovation, and will support investments in areas of research essential 
for a clean energy future. The President's Plan commits to doubling 
Federal investment in basic research at select agencies. The Department 
supports an overarching commitment to science by investing in basic and 
applied research, creating new incentives for private innovation and 
promoting breakthroughs in energy.
    To help achieve the game-changing breakthroughs needed to continue 
leading the global economy, the fiscal year 2011 budget request 
includes $300 million for the Advanced Research Projects Agency-Energy 
(ARPA-E). Introduced in fiscal year 2009, ARPA-E is responsible for 
enabling specific high-risk and high-payoff transformational research 
and development projects. Beyond simply funding transformational 
research that creates revolutionary technologies, ARPA-E is dedicated 
to the market adoption of those new technologies to meet the Nation's 
long-term energy challenges. This funding, along with the $400 million 
made available through the Recovery Act, will provide sustained 
investment in this pioneering program.
    The Department will continue funding the three Energy Innovation 
Hubs introduced in fiscal year 2010 to focus on developing fuels that 
can be produced directly from sunlight, improving energy efficient 
building systems design, and using modeling and simulation tools to 
create a virtual model of an operating advanced nuclear reactor. In 
addition, DOE is proposing a new Hub to focus on batteries and energy 
storage. Each of these Hubs will bring together a multidisciplinary 
team of researchers in an effort to speed research and shorten the path 
from scientific discovery to technological development and commercial 
deployment of highly promising energy-related technologies.
    Complementing the Hubs, the Department proposes expanding the 
Energy Frontier Research Centers in fiscal year 2011 to capture new, 
emerging opportunities by furthering its scientific reach and potential 
technological impact by competitively soliciting in two categories: 
discovery and development of new materials critical to science 
frontiers and technology innovations, and basic research for energy 
needs.
Energy--Providing Clean, Secure Energy and Promoting Economic 
        Prosperity through Energy Efficiency and Domestic Forms of 
        Energy
    In Copenhagen, President Obama emphasized that climate change is a 
grave and growing danger. The imperative now is to develop the capacity 
to confront the challenges climate change poses and seize the 
opportunity to be the global leader in the clean energy economy. 
Meeting the administration's goal to reduce carbon emissions by more 
than 80 percent by 2050 will be achieved by addressing supply and 
demand through increased energy efficiency, renewable generation, and 
grid modernization, as well as improvements in existing technologies 
and information analysis. An important tool that will continue to be 
used to address these issues will be loan guarantees. The Department's 
fiscal year 2011 budget request, building on the fiscal year 2010 
budget and the Recovery Act, invests in the research, development, and 
deployment of technologies that will position the United States to lead 
international efforts to confront climate change now and in the future. 
The long-term economic recovery will be sustained by these continued 
investments in the new energy economy.
            Loan Guarantees
    The Loan Guarantee Program Office (LGPO) is a vital tool for 
promoting innovation in the energy sector across a broad portfolio of 
clean and efficient energy technologies. In fiscal year 2011, the 
Department is requesting funding and authority to support approximately 
$40 billion in additional loan authority for innovative energy 
technology development. During fiscal year 2010, the LGPO streamlined 
the application review process. The new authority requested will help 
the Department to encourage and accelerate the availability of loans to 
leverage private sector investment in clean energy projects that will 
save and create jobs and stimulate the economy.
            Energy Efficiency
    In August 2009, President Obama said, ``If we want to reduce our 
dependence on oil, put Americans back to work and reassert our 
manufacturing sector as one of the greatest in the world, we must 
produce the advanced, efficient vehicles of the future.'' In fiscal 
year 2011, the Department will promote energy efficiency in vehicles 
technologies, at $325 million. No less important to achieving the 
President's stated ambitions is decreasing energy consumption through 
developing and advancing building technologies ($231 million) and 
industrial technologies ($100 million). Federal assistance for State-
level programs, such as State Energy Program grants ($75 million, a 50 
percent increase from fiscal year 2010) and Weatherization Assistance 
grants ($300 million, a 43 percent increase from fiscal year 2010), 
will help States and individuals take advantage of efficiency measures 
for buildings and homes, lower energy costs and greenhouse gas 
emissions, and develop an ever-evolving, technically proficient 
workforce.
            Clean, Renewable Energy Generation
    The fiscal year 2011 budget request will modernize the Nation's 
energy infrastructure by investing in a variety of renewable sources 
such as solar ($302 million), wind ($123 million), water ($41 million), 
hydrogen ($137 million), biomass ($220 million) and geothermal ($55 
million). These sources of energy reduce the production of greenhouse 
gas emissions and continue the pursuit of a clean energy economy built 
on the next generation of domestic production. The Department is also 
continuing to promote domestic clean energy through the four Power 
Marketing Administrations, which market and deliver electricity 
primarily generated by hydroelectric dams.
            Grid Modernization
    In support of the modernization of the electricity grid, the 
President's fiscal year 2011 budget requests $144 million for research 
and development to improve reliability, efficiency, flexibility, and 
security of electricity transmission and distribution networks. The 
``Smart Grid'' will integrate new and improved technologies into the 
energy mix, ensuring reliability, integration of renewable energy 
resources, and improving security.
    While investing in energy efficiency, renewable energy generation, 
and grid modernization are fundamental steps necessary for creating a 
clean energy economy; investing in the improvement of existing sources 
of energy will provide a bridge between current and future 
technologies. These technologies are already a major segment of the 
energy mix and will play a critical role in providing a solid 
foundation that will make possible the creation of this new economy.
            Safe and Secure Nuclear Energy
    Nuclear energy currently supplies approximately 20 percent of the 
Nation's electricity and 70 percent of the Nation's clean, non-carbon 
electricity. The request for the Office of Nuclear Energy includes $495 
million for research, development, and demonstration in addition to 
investments in supportive infrastructure. Work on advanced reactor 
technologies, fuel cycle technologies, waste management, and cross-
cutting technologies and transformative concepts will help ensure that 
nuclear energy remains a safe, secure, economical source of clean 
energy. The Department will also promote nuclear energy through the 
Loan Guarantee Program, which is requesting an additional $36 billion 
in loan authority for nuclear power in fiscal year 2011 (for a total of 
$54.5 billion).
            Clean and Abundant Fossil Energy
    The world will continue to rely on coal fired electrical generation 
to meet energy demand. It is imperative that the United States develop 
the technology to ensure that base-load electricity generation is as 
clean and reliable as possible. The Office of Fossil Energy will invest 
$438 million in the research and development of advanced coal-fueled 
power systems and carbon capture and storage technologies. This will 
allow the continued use of the abundant domestic coal resources in the 
United States while reducing greenhouse gas emissions.
    Accurate energy information and analysis play a critical role in 
promoting efficient energy markets and informing policy-making and 
strategic planning. This budget requests a total of $129 million for 
the Energy Information Administration, the statutory statistical agency 
within the Department, to improve energy data and analysis programs.
Security--Safeguarding Nuclear and Radiological Materials, Advancing 
        Responsible Legacy Cleanup and Maintaining Nuclear Deterrence
            Reduces the Risk of Proliferation
    In an April 2009 speech in Prague, the President called the threat 
of nuclear proliferation ``the most immediate and extreme threat to 
global security'' and announced his support for a new international 
effort to secure all vulnerable nuclear material around the world 
within 4 years. The fiscal year 2011 budget for the NNSA Defense 
Nuclear Nonproliferation program supports this effort, recognizing the 
urgency of the threat and making the full commitment to global 
cooperation that is essential to addressing this threat. The budget 
provides $2.7 billion in fiscal year 2011, and $13.7 billion through 
fiscal year 2015 to detect, secure, and dispose of dangerous nuclear 
and radiological material worldwide. This request is an increase of 26 
percent or $550 million from fiscal year 2010. The budget supports 
cooperative nonproliferation initiatives with foreign governments and 
the effort and expertise to forge them into durable international 
partnerships, achieving the objective of a world without nuclear 
weapons. The budget continues the installation of radiation detection 
equipment at international border crossings and Megaports, 
significantly expands materials protection and control security 
upgrades at selected sites in foreign countries to address outsider and 
insider threats, and accelerates the pace of highly enriched uranium 
research reactor conversions with an urgent focus to develop the 
capability to produce the medical isotope molybdenum-99 in the United 
States using low enriched uranium. The fiscal year 2011 budget request 
provides $4.4 billion over 5 years for Fissile Materials Disposition 
including the construction of U.S. facilities for the disposition of 
U.S. weapons-grade plutonium in fulfillment of our commitment with the 
Russian Federation under the Plutonium Management and Disposition 
Agreement of September 2000, and provides the first $100 million of a 
$400 million U.S. commitment to advance the construction of plutonium 
disposition facilities in the Russian Federation. The fiscal year 2011 
budget request also supports a funding increase for Nonproliferation 
and Verification Research and Development for new technologies in 
support of treaty monitoring and verification.
            Leverages Science to Maintain Nuclear Deterrence
    The fiscal year 2011 budget request advances the Department's 
commitment to the national security interests of the United States 
through stewardship of a safe, secure and effective nuclear weapons 
stockpile without the use of underground nuclear testing. As the role 
of nuclear weapons in our Nation's defense evolves and the threats to 
national security continue to grow, the focus of this enterprise must 
also change and place its tremendous intellectual capacity and unique 
facilities in the service of addressing other challenges related to 
national defense. NNSA is taking steps to move in this direction, 
including functioning as a national science, technology, and 
engineering resource to other agencies with national security 
responsibilities. NNSA must ensure our evolving strategic posture 
places the stewardship of our nuclear stockpile, nonproliferation 
programs, counterterrorism, missile defenses, and the international 
arms control objectives into one comprehensive strategy that protects 
the American people and our allies. Through the NNSA, the Department 
requests $7.0 billion for the Weapons Activities appropriation, a 9.8 
percent or $624 million increase from the fiscal year 2010 
appropriation. This increase provides a strong basis for transitioning 
to a smaller nuclear stockpile, strengthens the science, technology and 
engineering base, modernizes key nuclear facilities, and streamlines 
the enterprise's physical and operational footprint.
    These investments will enable execution of a comprehensive nuclear 
defense strategy based on current and projected global threats that 
relies less on nuclear weapons, yet enhances national security by 
strengthening the NNSA's nuclear security programs. This improved NNSA 
capability base will mitigate the concerns regarding ratification of 
the follow-on Strategic Arms Reduction Treaty and the Comprehensive 
Test Ban Treaty. The fiscal year 2011 request for Weapons Activities 
has four major components. The request for Stockpile Support increases, 
reflecting the President's commitment to maintain the safety, security 
and effectiveness of the nuclear deterrent without underground nuclear 
testing, consistent with the principles of the Stockpile Management 
Program outlined in section 3113(a)(2) of the National Defense 
Authorization Act of fiscal year 2010 (50 U.S.C. 2524). The request for 
Science, Technology and Engineering increases by over 10 percent, and 
provides the funding necessary to protect and advance the scientific 
capabilities at the U.S. nuclear security laboratories supporting the 
stockpile and broader national security and energy issues. The budget 
request for infrastructure supports the operation and maintenance of 
the Government-owned, contractor-operated facilities in the nuclear 
security enterprise, as well as special capabilities for secure 
transportation and construction. The security and counterterrorism 
component of the budget provides for physical and cyber security in the 
NNSA enterprise, as well as emergency response assets and NNSA's 
focused research and development contribution to the Nation's 
counterterrorism efforts.
            Advances Responsible Environmental Cleanup
    The fiscal year 2011 budget includes $6 billion for the Office of 
Environmental Management to protect public health and safety by 
cleaning up hazardous, radioactive legacy waste from the Manhattan 
Project and the cold war. This funding will allow the program to 
continue to accelerate cleaning up and closing sites, focusing on 
activities with the greatest risk reduction.
    As the Department continues to make progress in completing clean-
up, the fiscal year 2011 budget request of $189 million for the Office 
of Legacy Management supports the Department's long-term stewardship 
responsibilities and payment of pensions and benefits for former 
contractor workers after site closure.
    The administration has determined that the Yucca Mountain 
repository is not a workable option and has decided to terminate the 
Office of Civilian Radioactive Waste Management. The core functions and 
staff to support efforts under the Nuclear Waste Policy Act to meet the 
obligation of the Government will transfer to the Office of Nuclear 
Energy by the end of fiscal year 2010.
Management--Transforming the Culture of the Department With a Results-
        Oriented Approach
    In order to transform the way Americans use and produce energy, we 
must transform the Department of Energy. The Department is committed to 
strengthening its management culture and increasing its focus on 
results. The implementation of the Recovery Act provided the Department 
with an opportunity to continue to refine best practices in management, 
accountability, operations, and transparency. These best practices will 
be applied in executing the fiscal year 2011 budget.
    To achieve our strategic priorities, the Department requests a net 
of $169 million for departmental administration. These funds, along 
with resources in individual program offices, will help transform key 
functional areas such as human, financial, project, and information 
technology management. The request includes $2 million for Management 
Reform within the Office of the Secretary, which will provide the 
Department with strategic direction, coordination, and oversight of 
reform initiatives.
    department of energy fiscal year 2011 program office highlights
Office of Science--Supporting Cutting-Edge Foundational Scientific 
        Research
    The Department of Energy's Office of Science (SC) delivers 
discoveries and scientific tools that transform our understanding of 
energy and matter and advance the national, economic, and energy 
security of the United States. SC is a primary sponsor of basic 
research in the United States, leading the Nation to support the 
physical sciences in a broad array of research subjects in order to 
improve energy security and address issues ancillary to energy, such as 
climate change, genomics, and life sciences. In fiscal year 2011, the 
Department requests $5.1 billion, an increase of 4.4 percent over the 
enacted fiscal year 2010 appropriation, to invest in science research. 
The fiscal year 2011 request supports the President's Plan for Science 
and Innovation, which encompasses the entire SC budget, as part of a 
strategy to double overall basic research funding at select agencies. 
As part of this plan, the budget request supports the training of 
students and researchers in fields critical to our national 
competitiveness and innovation economy, and supports investments in 
areas of research critical to our clean energy future and to making the 
United States a leader on climate change.
    SC is addressing critical societal challenges and key missions of 
the Department of Energy through significant improvements in existing 
technologies and development of new energy technologies. SC will 
accomplish this by: (1) sustained investments in exploratory and high-
risk research in traditional and emerging disciplines, including the 
development of new tools and facilities; (2) focused investments in 
high-priority research areas; and (3) investments that train new 
generations of scientists and engineers to be leaders in the 21st 
century. The fiscal year 2011 budget request supports all three of 
these investment strategies.
    Two of the four Energy Innovation Hubs being requested in fiscal 
year 2011 are through the Office of Science; these Hubs will bring 
together teams of experts from multiple disciplines to focus on two 
grand challenges in energy: (1) Fuels from Sunlight, a Hub established 
in fiscal year 2010 and (2) Batteries and Energy Storage, a new Hub in 
the fiscal year 2011 request.
    The Energy Frontier Research Centers (EFRC) program will be 
expanded in the fiscal year 2011 request to capture new, emerging 
opportunities by furthering its scientific reach and potential 
technological impact. New EFRCs will be competitively solicited in two 
categories: discovery and development of new materials that are 
critical to both science frontiers and technology innovations, and 
basic research for energy needs in a limited number of areas that are 
underrepresented in the 46 original EFRC awards.
    The fiscal year 2011 request for the U.S. ITER Project ($80 
million, a decrease of $55 million from fiscal year 2010) is a 
reflection of the pace of ITER construction as of the end of 2009. The 
administration is engaged in a range of efforts to implement management 
reforms at the ITER organization and accelerate ITER construction while 
minimizing the overall cost of the construction phase for the United 
States and the other ITER members.
    The Office of Science supports investigators from more than 300 
academic institutions and from all of the DOE laboratories. The fiscal 
year 2011 budget request will support approximately 27,000 Ph.D.s, 
graduate students, undergraduates, engineers, and technicians. Nearly 
26,000 researchers from universities, national laboratories, industry, 
and international partners are expected to use SC scientific user 
facilities in fiscal year 2011.
Advanced Research Projects Agency-Energy--Transformational Research and 
        Development
    The fiscal year 2011 budget request includes $300 million for the 
Advanced Research Projects Agency-Energy (ARPA-E), a program launched 
in fiscal year 2009 that sponsors specific high-risk and high-payoff 
transformational research and development projects that overcome the 
long-term technological barriers in the development of energy 
technologies to meet the Nation's energy challenges, but that industry 
will not support at such an early stage. An essential component of 
ARPA-E's culture is an overarching focus on accelerating science to 
market. Beyond simply funding transformational research creating 
revolutionary technologies, ARPA-E is dedicated to the market adoption 
of those new technologies that will fuel the economy, create new jobs, 
reduce energy imports, improve energy efficiency, reduce energy-related 
emissions, and ensure that the U.S. maintains a technological lead in 
developing and deploying advanced energy technologies.
Office of Energy Efficiency and Renewable Energy--Developing and 
        Deploying Clean, Reliable Energy
    The Office of Energy Efficiency and Renewable Energy (EERE) 
strengthens the energy security, environmental quality, and economic 
vitality of the United States through the research, development, 
demonstration and deployment (RDD&D) of clean energy technologies and 
generation and advances in energy efficiency. EERE's activities are 
critical to creating a low carbon economy and sustaining strong 
economic growth and job creation while dramatically reducing greenhouse 
gas emissions and energy imports. EERE programs link advances in basic 
research and the creation of commercially successful products and 
services to ensure delivery to the marketplace for general use and 
implementation.
    The fiscal year 2011 budget request of $2.4 billion, an increase of 
5 percent over fiscal year 2010, is aimed at accelerating revolutionary 
change in the Nation's energy economy. The request includes programs 
associated with meeting the President's goals of investing in the next 
generation of clean energy technologies, vehicles and fuels, and energy 
efficiency measures that reduce energy use in Federal agencies and the 
industrial and building sectors.
            Clean, Renewable Energy Generation
    The fiscal year 2011 budget request continues to work to transform 
the Nation's energy infrastructure by investing over $650 million in a 
variety of renewable sources of electrical generation such as solar 
($302 million, a 22 percent increase over fiscal year 2010), and wind 
($123 million, a 53 percent increase over fiscal year 2010), as well as 
deploy clean technologies to reduce our dependence on oil. The request 
includes expansions on Concentrating Solar Power, biopower and off-
shore wind, which will provide new, additional avenues for clean energy 
development and deployment. These technologies will reduce the 
production of greenhouse gas emissions and revitalize an economy built 
on the next generation of domestic production.
            Energy Efficiency
    The Department implements a number of efforts to increase energy 
efficiency and conservation in homes, transportation, and industry. The 
fiscal year 2011 budget requests $758 million to accelerate deployment 
of clean, cost-effective, and rapidly deployable energy conservation 
measures in order to reduce energy consumption in residential and 
commercial buildings, and the industrial and Federal sectors. The 
Department will invest $231 million in the Building Technologies 
program, a 16 percent increase over fiscal year 2010 for built 
environment R&D. Federal assistance for State-level programs such as 
State Energy Program grants ($75 million) and Weatherization Assistance 
Program ($300 million), will continue to help citizens implement energy 
conservation measures, lower energy costs and greenhouse gas emissions, 
and build a technical workforce. The fiscal year 2011 request also 
includes $545 million to accelerate research, development and 
deployment of advanced fuels and vehicles to reduce the use of 
petroleum and greenhouse gas emissions. The fiscal year 2011 budget 
complements the Recovery Act funding for these programs ($3.1 billion 
for State Energy Programs, $5 billion for Weatherization Assistance, $2 
billion for Advanced Battery Manufacturing and $400 million for 
Transportation Electrification).
Office of Electricity Delivery and Energy Reliability--Moving Toward a 
        More Intelligent Grid to Power the Digital Economy
    The fiscal year 2011 budget request for the Office of Electricity 
Delivery and Energy Reliability (OE) budget is $186 million, an 
increase of 8 percent over fiscal year 2010. These funds will build on 
the ``Smart Grid'' investments and other activities.
    The ability of the United States to meet the growing demand for 
reliable electricity is challenged by an aging power grid under 
mounting stress. Despite the increasing demand for reliable power 
brought on by the modern digital economy, the power grid in the United 
States has suffered from a long period of underinvestment. Much of the 
power delivery system was built on technology developed over 50 years 
ago and thus responds to disturbances with speed limited by the 
technology of that period. This limitation increases the vulnerability 
of the power system to outages that can spread quickly and impact whole 
regions. Breakthroughs in digital network controls, transmission, 
distribution, and energy storage will make the power grid more 
efficient, alleviating the stress on the system, as well as enable 
greater use of clean and distributed energy sources. The return on 
these investments will come from a reduction in economic losses caused 
by power outages and the delay or avoidance of costly investment in new 
generation and transmission infrastructure.
    The budget request provides $144 million for research and 
development, which supports development of technologies that will 
improve the reliability, efficiency, flexibility, functionality, and 
security of the Nation's electricity delivery system. It accelerates 
investment in energy storage capabilities and funds two new research 
initiatives: Advanced Modeling Grid Research, to develop grid-modeling 
capabilities using the large volumes of data generated by advanced 
sensors deployed on the grid; and Power Electronics, to develop new 
power control devices in collaboration with universities. The proposal 
also continues to support the development of ``Smart Grid'' 
technologies and cyber security systems for the power grid.
    The budget request continues support for Permitting, Siting, and 
Analysis ($6.4 million) to assist States, regional entities, and other 
Federal agencies in developing policies and programs aimed at 
modernizing the power grid; and for Infrastructure Security and Energy 
Restoration ($6.2 million) to enhance the reliability and resiliency of 
U.S. critical infrastructure and facilitate its recovery from energy 
supply disruptions.
Office of Environmental Management--Reducing Risks and Making Progress
    The mission of the Office of Environmental Management (EM) is to 
complete the safe cleanup of the environmental legacy brought about 
from over six decades of nuclear weapons development, production, and 
Government-sponsored nuclear energy research. This cleanup effort is 
the largest in the world, originally involving 2 million acres at 107 
sites in 35 states, dealing with some of the most dangerous materials 
known to man.
    EM continues to pursue its cleanup objectives within the overall 
framework of achieving the greatest comparative risk reduction benefit 
and overlaying regulatory compliance commitments and best business 
practices to maximize cleanup progress. To support this approach, EM 
has prioritized its cleanup activities:
  --Activities to maintain a safe and secure posture in the EM complex
  --Radioactive tank waste stabilization, treatment, and disposal
  --Used 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 and decommissioning
    The fiscal year 2011 budget request for $6.0 billion will fund 
activities to maintain a safe and secure posture in the EM complex and 
make progress against program goals and compliance commitments, 
including reduction of highest risks to the environment and public 
health, use of science and technology to reduce life cycle costs, and 
reduction of EM's geographic footprint by 40 percent by 2011. EM 
continues to move forward with the development of the capability for 
dispositioning tank waste, nuclear materials, and used nuclear fuel. 
The budget request includes the construction and operation of three 
unique and complex tank waste processing plants to treat approximately 
88 million gallons of radioactive tank waste for ultimate disposal. It 
will also fund the solid waste disposal infrastructure needed to 
support disposal of transuranic and low-level wastes generated by high-
risk activities and the footprint reduction activities. In addition to 
the fiscal year 2011 budget request, EM will continue to expend the $6 
billion in Recovery Act funding provided by Congress to complete lower-
risk footprint reduction and near-term completion cleanup activities.
    EM carries out its cleanup activities with the interests of 
stakeholders in mind. Most importantly, EM will continue to fulfill its 
responsibilities by conducting cleanup within a ``Safety First'' 
culture that integrates environment, safety, and health requirements 
and controls into all work activities to ensure protection to the 
workers, public, and the environment, and adheres to sound project and 
contract management principles. EM is also strengthening its project 
and planning analyses to better assess existing priorities and identify 
opportunities to accelerate cleanup work. Working collaboratively with 
the sites, EM continues to seek aggressive but achievable strategies 
for accelerating cleanup of discrete sites or segments of work. In 
addition, functional and cross-site activities such as elimination of 
specific groundwater contaminants, waste or material processing 
campaigns, or achievement of interim or final end-states are being 
evaluated.
    After the EM program completes cleanup and closure of sites that no 
longer have an ongoing DOE mission, post closure stewardship activities 
are transferred to the Office of Legacy Management (LM). LM also 
receives sites remediated by the U.S. Army Corps of Engineers (Formerly 
Utilized Sites Remedial Action Program) and private licensees (Uranium 
Mill Tailings Radiation Control Act, title II sites). Post closure 
stewardship includes long-term surveillance and maintenance activities 
such as groundwater monitoring, disposal cell maintenance, records 
management, and management of natural resources at sites where active 
remediation has been completed. At some sites the program includes 
management and administration of pension and post-retirement benefits 
for contractor retirees.
    The administration has determined that developing a repository at 
Yucca Mountain, Nevada, is not a workable option and has decided to 
terminate the Office of Civilian Radioactive Waste Management (RW). The 
Nation needs a different solution for nuclear waste disposal. As a 
result, in 2010, the Department will discontinue its application to the 
U.S. Nuclear Regulatory Commission for a license to construct a high-
level waste geologic repository at Yucca Mountain and establish a Blue 
Ribbon Commission to inform the administration as it develops a new 
strategy for nuclear waste management and disposal. All funding for 
development of the Yucca Mountain facility and RW will be eliminated by 
the end of fiscal year 2010. The administration remains committed to 
fulfilling its obligations under the Nuclear Waste Policy Act. The 
Office of Nuclear Energy will develop an integrated approach to improve 
the waste management options for the Nation and support the Blue Ribbon 
Commission. Ongoing responsibilities under the Nuclear Waste Policy 
Act, including administration of the Nuclear Waste Fund and the 
Standard Contract, will continue under the Office of Nuclear Energy, 
which will lead future waste management activities.
Innovative Technology Loan Guarantee Program and Advanced Technology 
        Vehicle Manufacturing Program--Supporting Investment in 
        Innovation and Manufacturing
    To encourage the early commercial production and use of new or 
significantly improved technologies in energy projects, the Department 
is requesting an additional $36 billion in authority to guarantee loans 
for nuclear power facilities and $500 million in appropriated credit 
subsidy for the cost of loan guarantees for renewable energy systems 
and efficient end-use energy technology projects under section 1703 of 
the Energy Policy Act of 2005. The additional loan authority for 
nuclear power projects will promote near-term deployment of new plants 
and support an increasing role for private sector financing. The 
additional credit subsidy will allow for investment in the innovative 
renewable and efficiency technologies that are critical to meeting the 
administration's goals for affordable, clean energy, technical 
leadership, and global competitiveness.
    The fiscal year 2011 budget also requests $58 million to evaluate 
applications received under the eight solicitations released to date 
and to ensure efficient and effective management of the Loan Guarantee 
Program. This request will be offset by collections authorized under 
title XVII of the Energy Policy Act of 2005 (Pub. L. 109-8).
    The Advanced Technology Vehicle Manufacturing program requests $10 
million to support ongoing loan and loan monitoring activities 
associated with the program mission of making loans to automobile and 
automobile part manufacturers for the cost of re-equipping, expanding, 
or establishing manufacturing facilities in the United States to 
produce advanced technology vehicles or qualified components, and for 
associated engineering integration costs.
Office of Nuclear Energy--Investing in Energy Security and Technical 
        Leadership
    The Department is requesting $912 million for the Office of Nuclear 
Energy (NE) in fiscal year 2011 --an increase of 5 percent over the 
fiscal year 2010 enacted level. NE's funding supports the advancement 
of nuclear power as a resource capable of meeting the Nation's energy, 
environmental, and national security needs by resolving technical, 
cost, safety, proliferation resistance, and security barriers through 
research, development, and demonstration as appropriate.
    Currently, nuclear energy supplies approximately 20 percent of the 
Nation's electricity and over 70 percent of clean, non-carbon producing 
electricity. Over 100 nuclear power plants are offering reliable and 
affordable baseload electricity in the United States, and they are 
doing so without air pollution and greenhouse gas emissions. NE is 
working to develop innovative and transformative technologies to 
improve the competitiveness, safety and proliferation resistance of 
nuclear energy to support its continued use.
    The fiscal year 2011 budget supports a reorganized and refocused 
set of research, development, and demonstration (RD&D) activities. This 
program is built around exploring, through RD&D: technology and other 
solutions that can improve the reliability, sustain the safety, and 
extend the life of current reactors; improvements in the affordability 
of new reactors to enable nuclear energy to help meet the 
administration's energy security and climate change goals; 
understanding of options for nuclear energy to contribute to reduced 
carbon emissions outside the electricity sector; development of 
sustainable nuclear fuel cycles; and minimization of risks of nuclear 
proliferation and terrorism.
    NE is requesting $195 million for Reactor Concepts Research, 
Development and Deployment. This program seeks to develop new and 
advanced reactor designs and technologies. Work will continue on 
design, licensing and R&D for the Next Generation Nuclear Plant to 
demonstrate gas-cooled reactor technology in the United States. The 
program also supports research on Generation IV and other advanced 
designs and efforts to extend the life of existing light water 
reactors. In fiscal year 2011, NE will initiate a new effort focused on 
small modular reactors, a technology the Department believes has 
promise to help meet energy security goals.
    The fiscal year 2011 request includes $201 million for Fuel Cycle 
Research and Development to perform long-term, results-oriented 
science-based R&D to improve fuel cycle and waste management 
technologies to enable a safe, secure, and economic fuel cycle. The 
budget also requests $99 million to support a new R&D program, Nuclear 
Energy Enabling Technologies, focused on the development of cross-
cutting and transformative technologies relevant to multiple reactor 
and fuel cycle concepts. The Crosscutting Technology Development 
activity provides crosscutting R&D support for nuclear energy concepts 
in areas such as reactor materials and creative approaches to further 
reduce proliferation risks. The Transformative Nuclear Concepts R&D 
activity will support, via an open, competitive solicitation process, 
investigator-initiated projects that relate to any aspect of nuclear 
energy generation including, but not limited to, reactor and power 
conversion technologies, enrichment, fuels and fuel management, waste 
disposal, and nonproliferation, to ensure that good ideas have 
sufficient outlet for exploration.
    The Energy Innovation Hub for Modeling and Simulation will apply 
existing modeling and simulation capabilities to create a ``virtual'' 
reactor user environment to simulate an operating reactor. NE will also 
continue its commitments to investing in university research, 
international cooperation, and the Nation's nuclear infrastructure--
important foundations to support continued technical advancement.
Office of Fossil Energy--Abundant and Affordable Energy for the 21st 
        Century
    The fiscal year 2011 budget request of $760 million for the Office 
of Fossil Energy (FE) will help ensure that the United States can 
continue to rely on clean, affordable energy from traditional domestic 
fuel resources. The United States has 25 percent of the world's coal 
reserves, and fossil fuels currently supply 86 percent of the Nation's 
energy.
    The Department is committed to advancing Carbon Capture and Storage 
(CCS) technologies in order to promote a cleaner and more efficient use 
of fossil fuels. In addition to significant Recovery Act funds, 
Advanced CCS with $438 million requested in fiscal year 2011 is the 
foundation of the Department's clean coal research program which seeks 
to establish the capability of producing electricity from coal with 
near-zero atmospheric emissions.
    In addition, $150 million of FE's $760 million request will be used 
to promote national energy security through the continued operations of 
both the Strategic Petroleum Reserve and Northeast Home Heating Oil 
Reserve programs. These programs protect the Nation and the public 
against economic damages from potential disruptions in foreign and 
domestic petroleum supplies.
Energy Information Administration--Providing Independent Statistics and 
        Analysis
    The fiscal year 2011 request for the Energy Information 
Administration (EIA) is $128.8 million, which is an $18.2 million 
increase over the fiscal year 2010 current appropriation. EIA conducts 
a comprehensive data collection program through more than 60 surveys 
that cover the full spectrum of energy sources, end uses, and energy 
flows; generates short- and long-term domestic and international energy 
projections; and performs informative energy analyses. EIA disseminates 
its data products, analyses, reports, and other information services to 
customers and stakeholders primarily through its Web site.
    The increased funding improves EIA's capability to close energy 
information gaps, strengthen analysis, and address significant data 
quality issues. It provides for an expanded survey of energy 
consumption in commercial buildings that will provide more baseline 
information critical to understanding energy use. That survey also is a 
basis for benchmarking and performance measurement for energy 
efficiency programs. The budget request also provides for: expanded 
analysis of energy market behavior and data to address the increasingly 
important interrelationship of energy and financial markets; continued 
implementation of improvements in data coverage, quality and 
integration; upgrades to the National Energy Model; and initiation of 
efforts to track and analyze the adoption of ``Smart Grid'' 
technologies and dynamic electricity pricing plans.
The National Nuclear Security Administration--Ensuring America's 
        Nuclear Security and Reducing the Global Threat of Nuclear 
        Proliferation
    The National Nuclear Security Administration (NNSA) continues 
significant efforts to meet administration priorities, leveraging 
science to promote U.S. national security objectives. The fiscal year 
2011 President's budget request is $11.2 billion, an increase of 13 
percent from the enacted fiscal year 2010 appropriation. The fiscal 
year 2011-2015 President's Request for the NNSA is a significant 
funding increase over fiscal year 2010 levels, reflecting the 
President's priorities on global nuclear nonproliferation and for 
strengthening the nuclear security posture of the United States to meet 
defense and homeland security-related objectives:
  --Broaden and strengthen the NNSA's science, technology and 
        engineering mission to meet national security needs
  --Work with global partners to secure all vulnerable nuclear 
        materials around the world within 4 years
  --Work toward a world with no nuclear weapons. Until that goal is 
        achieved, ensure the U.S. nuclear deterrent remains safe, 
        secure and effective
  --Transform the Nation's cold-war era weapons complex into a 21st 
        century national security enterprise
  --Provide safe and effective nuclear propulsion for U.S. navy 
        warships
    The fiscal year 2011 budget request of $7.01 billion for the 
Weapons Activities appropriation provides funding for a wide range of 
programs. Some activities provide direct support for maintaining the 
nuclear weapon stockpile, including stockpile surveillance, annual 
assessments, life extension programs, and warhead dismantlement. 
Science, Technology and Engineering programs are focused on long-term 
vitality in science and engineering, and on performing R&D to sustain 
current and future stockpile stewardship capabilities without the need 
for underground nuclear testing. These programs also provide a base 
capability to support scientific research needed by other elements of 
the Department, to the Federal Government national security community, 
and the academic and industrial communities. Infrastructure programs 
support facilities and operations at the Government-owned, contractor-
operated sites, including activities to maintain and steward the health 
of these sites for the long term. Security and counterterrorism 
activities leverage the unique nuclear security expertise and resources 
maintained by NNSA to other Departmental offices and to the Nation.
    The Weapons Activities request is an increase of 9.8 percent over 
the fiscal year 2010 enacted level. This level is sustained and 
increased in the later out-years. The multi-year increase is necessary 
to reflect the President's commitment to maintain the safety, security 
and effectiveness of the nuclear deterrent without underground nuclear 
testing, consistent with the principles of the Stockpile Management 
Program outlined in section 3113(a)(2) of the National Defense 
Authorization Act of fiscal year 2010 (50 U.S.C. 2524). Increases are 
provided which directly support of the nuclear weapon stockpile, for 
scientific, technical and engineering activities related to maintenance 
assessment and certification capabilities, and for recapitalization of 
key nuclear facilities. The President's request provides funding 
necessary to protect the human capital base at the national 
laboratories--including the ability to design and certify nuclear 
weapons--through a stockpile stewardship program that fully exercises 
these capabilities. Security and nuclear counterterrorism activities 
decrease about 3 percent from the fiscal year 2010 appropriated levels, 
leveraging the continuing efficiencies in the Defense Nuclear Security 
budget.
    The fiscal year 2011 request for Defense Nuclear Nonproliferation 
is $2.7 billion, an increase of 25.8 percent over the fiscal year 2010 
appropriation. The increase is driven by the imperative for U.S. 
leadership in nonproliferation initiatives both here and abroad. In 
addition to the programs funded solely by the NNSA, our programs 
support the Department of Energy mission to protect our national 
security by preventing the spread of nuclear weapons and nuclear 
materials to terrorist organizations and rogue states. These efforts 
are implemented in part through the Global Partnership Against the 
Spread of Weapons and Materials of Mass Destruction, formed at the G8 
Kananaskis Summit in June 2002, and the Global Initiative to Combat 
Nuclear Terrorism, launched in Rabat, Morocco, in October 2006.
    The fiscal year 2011 President's request for International Nuclear 
Materials Protection and Cooperation reflects selective new security 
upgrades to buildings and areas that were added to the cooperation 
after the Bratislava Summit, additional Second Line of Defense sites, 
and sustainability support for MPC&A upgrades. The Global Threat 
Reduction Initiative increases by 68 percent in support of the 
international effort to secure vulnerable nuclear materials around the 
world within 4 years. The Fissile Materials Disposition program 
increases by 47 percent reflecting continuing domestic construction of 
the MOX Fuel Fabrication Facility and the Waste Solidification 
Building, as well as design documentation for a related pit disassembly 
and conversion capability. A portion of the funding increase results 
from the transfer of funding associated with the latter activity from 
the Weapons Activities appropriation starting in 2011.
    The President's request of $1.1 billion for Naval Reactors is an 
increase of 13.3 percent over the fiscal year 2010 appropriated level. 
The program supports the U.S. Navy's nuclear fleet, comprised of all of 
the Navy's submarines and aircraft carriers, including 52 attack 
submarines, 14 ballistic missile submarines, 4 guided missile 
submarines, and 11 aircraft carriers. These ships are relied on every 
day, all over the world, to protect our national interests. Starting in 
fiscal year 2010, there are major new missions for the NNSA Naval 
Reactors program. A significant funding increase is requested for the 
OHIO Class submarine replacement and for the related activity which 
will demonstrate new submarine reactor plant technologies as part of 
the refueling of the land-based prototype reactor. R&D is underway now, 
and funding during this Future Years Nuclear Security Program is 
critical to support the long manufacturing spans for procurement of 
reactor plant components in 2017, and ship procurement in 2019. 
Resources are also included in fiscal year 2011 to support commencement 
of design work for the recapitalization of used nuclear fuel 
infrastructure.
    The Office of the Administrator appropriation provides for Federal 
program direction and support for NNSA's Headquarters and field 
installations. The fiscal year 2011 request is $448.3 million, a 6.5 
percent increase over the fiscal year 2010 appropriation. This provides 
for well-managed, inclusive, responsive, and accountable organization 
through the strategic management of human capital, enhanced cost-
effective utilization of information technology, and integration of 
budget and performance through transparent financial management 
practices.
Management--Transforming the Culture of the Department with a Results-
        Oriented Approach
    To transform the way Americans use and produce energy, we need to 
transform the Department of Energy. Because the mission of the 
Department is vital and urgent, it must be pursued using a results-
oriented approach that is safe, fiscally responsible, and legally and 
ethically sound. The Department has developed strong management and 
oversight capabilities during implementation of the Recovery Act, and 
these lessons will be applied to the fiscal year 2011 budget. The 
budget request of $337 million for corporate management includes $75 
million for the Office of Management, $102 million for the Office of 
the Chief Information Officer, $43 million for the Inspector General's 
office, $62.7 million for the Office of the Chief Financial Officer, 
$37 million for the Office of General Counsel, and $2 million for 
Management Reform within the Office of the Secretary. The Management 
Reform effort will provide the Department with strategic direction, 
coordination, and oversight of management initiatives. The primary 
mission of this new office is to identify operational efficiencies to 
free up resources for priority mission activities. The Department is 
also requesting $12 million for a new Acquisition Workforce Improvement 
initiative which will be utilized to increase the size and improve the 
training of our acquisition professionals.
    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. To accomplish this goal, the Department will develop 
different 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.
    To improve stewardship of taxpayer dollars, the Department will 
continue to issue audited financial statements in an accelerated 
timeframe and provide assurance that the Department's financial 
management meets the highest standards of integrity. The Department's 
fiscal year 2009 financial statements were reviewed by independent 
auditors and received an unqualified opinion. This was made possible by 
implementing an aggressive plan to mitigate and remediate a number of 
financial management challenges that were identified by the Department 
and its independent auditors. In addition, the Department continues to 
strengthen the execution of program funding dollars by having regular 
execution reviews that will ensure funding is processed, approved and 
spent quickly and responsibly. The Department in fiscal year 2011 will 
continue its effort to build and improve its integrated business 
management system.
    The Department is continuing to make progress in improving project 
management and is implementing an action plan with scheduled milestones 
and aggressive performance metrics. The focus of the action plan is to 
successfully address the root causes of the major challenges to 
planning and managing Department projects. The action plan identifies 
eight measures that, when completed, will result in significant, 
measurable, and sustainable improvements in the Department's contract 
and project management performance and culture.
    To improve financial performance in project management, the 
Department has increased the use of Earned Value Management (EVM) 
techniques within program offices. These techniques objectively track 
physical accomplishment of work and provide early warning of 
performance problems. A certification process was instituted for 
contractors' EVM systems to improve the definition of project scope, 
communicate objective progress to stakeholders and keep project teams 
focused on achieving progress. Currently, 70 percent of the 
Department's capital asset projects have certified EVM systems.
    The Department continues to strengthen information technology 
management by consistent execution of robust IT Capital Planning and 
Investment Control oversight and reporting processes designed to ensure 
successful investment performance, including the use of EVM Systems as 
appropriate, and the remediation of poorly performing investments. 
Through the establishment and use of an Enterprise Architecture that 
aligns to the Federal Enterprise Architecture, the Department has 
ensured that all IT investments follow a comprehensive Modernization 
Roadmap.
    The Department continues to take significant actions to improve its 
cyber security posture by implementing its Cyber Security 
Revitalization Plan to address long-standing, systemic weaknesses in 
the Department's information and information systems. Specifically, the 
Department seeks to ensure that 100 percent of operational information 
technology systems are certified and accredited as secure and that the 
Department's Inspector General has rated the certification and 
accreditation process as ``satisfactory.'' Additional steps will be 
taken to ensure that electronic classified and personally identifiable 
information are secure.
                               conclusion
    I appreciate the opportunity to appear before you to present the 
fiscal year 2011 budget request for the Department of Energy. I will be 
happy to take any questions that members of the subcommittee may have.

    Senator Dorgan. Mr. Secretary, thank you very much.
    I have a number of questions, and I assume I will not get 
through all of them. But let me try to see if we can determine 
what is happening here.

                               FUTUREGEN

    This subcommittee has been wrestling with the question of 
FutureGen. Is it on? Is it off? Does it need to be funded? Does 
it not? If so, how will the money be used? So where are you on 
the decisionmaking process about FutureGen?
    Secretary Chu. We are working with the alliance. We put an 
offer to the alliance and we are working with them in hopes 
that they can come up with the necessary assets needed. This is 
in progress. We have extended the deadline because we are going 
to give them more time, but I think the deadline is coming up 
in the next couple weeks and then we will have to make a 
determination at that time.
    Senator Dorgan. Do you feel that we are losing time, 
though? FutureGen was sort of the new thing. As I indicated in 
my opening statement, we have a significant need to do the 
research to try to evaluate how we build electric generating 
plants that are going to capture carbon and do certain things 
with it. We have, obviously, lost time because the previous 
administration at one point decided to discontinue it, shut it 
down, and your administration has now for a year or so been 
trying to study it.
    Secretary Chu. Not so much trying to study it, trying to 
see if the alliance can put together a proposal that would be 
acceptable.
    But let me also say that I share your sense of urgency in 
getting carbon capture and sequestration technologies going. It 
is our stated goal that perhaps within 8-10 years, this would 
be ready for deployment and something that is economically 
viable.
    We have, through the Recovery Act--and this reflects the 
comments both you and Ranking Member Bennett made--invested 
over $4 billion in several pilot plants or pilot plant 
demonstrations, experiments for carbon capture and 
sequestration. The good news is that $4 billion has been 
matched by $6 billion or $7 billion of private sector money. So 
we know that the private sector has also gotten interested and 
committed to this.
    There are a number of projects now that are becoming 
competitive with FutureGen in the sense of the amount of carbon 
sequestered and things like that. We still want FutureGen to go 
forward, but it really depends on whether this package----
    Senator Dorgan. But in a broader sense, do you feel like 
the reduction in funds in the fossil energy account reflects 
less attention to and less interest in that area of energy?
    Secretary Chu. No, we do not. There is essentially $4 
billion plus $6 billion--$10 billion total investment in 
various forms of carbon capture and sequestration. In the 
following budget you will see an increase as we work through 
those demonstrations.

                           ELECTRIC VEHICLES

    Senator Dorgan. Let me ask about electric vehicles. Senator 
Alexander and I and others are putting together an electric 
vehicles piece of legislation. We have been working on it and 
are, I think, fairly close to introducing it.
    The President set a goal of having 1 million electric 
vehicles on the road by 2015. What are the things that you are 
doing and what should we see in this budget that reflects that? 
What percent of the advanced vehicle technology budget is going 
into electric drive vehicles, for example?
    Secretary Chu. We are investing a considerable amount in 
electric vehicles. As you know, the single most important thing 
is a better battery, a battery with higher energy density, a 
battery with higher energy per unit volume, and a battery that 
lasts the life of the car, let us say, 15 years if it 
moderately discharges, and a battery that costs a lot less.
    I would see a big up-tick, a significant up-tick in the 
market when we have that battery. I am optimistic that we will 
have the battery like that, but whether it is 1 year, 2 years, 
3 years from today I do not know. We are heavily investing in 
battery research. The goal of the hub proposed for fiscal year 
2011 is to get a battery that is dramatically better than the 
ones being prototyped today.
    But in addition to that, we are also investing in advanced 
battery manufacturing. This is something where the United 
States has fallen off, even though we actually invented a lot 
of the technology that went into the lithium ion battery, it 
was perfected by Sony. If you buy a hybrid car today, 98 
percent of the high technology batteries will have been 
manufactured in Asia. With the Advanced Battery Manufacturing 
Technology grants we have been giving, we hope to recapture a 
lot of that market.
    Senator Dorgan. But that is true of almost everything we 
invent. It migrates very quickly. In the last 20 years, what we 
have seen is a mass migration of that which we invent to be 
produced elsewhere.

                             BIOFUEL BLENDS

    Can you describe what you expect to see happen with the 
testing of higher biofuel blends, particularly E15, on 
vehicles. When do you think the administration can give us an 
answer on that, and what about legacy vehicles?
    Secretary Chu. I personally looked into this several months 
ago to try to see what we could do to accelerate the testing. 
There are a number of models we wanted to test and you have to 
put on a significant number of miles to test the vehicles. So 
the testing is going 24/7. I think it is going to be sometime 
late spring, maybe early summer where we can make a 
determination whether E15 would be viable in the vehicles.
    We are also testing deployed vehicles. And so that is the 
real issue, whether this 15 percent blend would do something 
that would affect the long-term and make the cars last as long 
as they initially would have.
    So perhaps by late spring, we will be done. That is what I 
recall from the last time I looked.
    Senator Dorgan. All right.

                  HYDROGEN AND FUEL CELL TECHNOLOGIES

    Finally, for hydrogen and fuel cell technologies, as you 
know, you are proposing a cut. Last year you proposed the 
elimination of all of those accounts. I think we are going to 
shut down 190, roughly, contracts. You are proposing a cut.
    You know, the hydrogen fuel cell vehicle is run on 
electricity. As we move toward an electric-drive system, it 
seems to me the continued work in hydrogen fuel cells is very 
important work.
    Can you provide for the subcommittee a summary of existing 
programs that would be discontinued or significantly scaled 
back in order to make these cute possible?
    Secretary Chu. Yes, I will do that.
    There was a difference of opinion last year. We have 
increased the hydrogen technology request over fiscal year 
2010, but it is still a decrease from what was appropriated. We 
are minimizing the discontinuity in the existing programs.
    I might say privately among some of the technical people in 
the oil companies, they recognize that this is something that 
might be 20 years plus away from a mass adoption. And so I am 
entering discussions privately with them to say, okay, can you 
start to band together because it is something so far in the 
future it makes sense to have consortiums work on it.
    Senator Dorgan. Yes. Except as a scientist, you know that 
that which seems far into the future becomes nearer and nearer 
the more work is done, and often we discover that the future 
was much closer than we thought and I would expect that to be 
the case here as well.
    I have many questions, but again, my colleagues are here 
and I want them to have time for questions. So I will submit 
questions in writing to you, and as I indicated, I have to go 
to the White House for a signing ceremony, so when I leave, 
Senator Tester will take the chair.
    But, Senator Bennett, did you wish to inquire?
    Senator Bennett. Yes. Thank you very much, Mr. Chairman.

                         WEATHERIZATION GRANTS

    Going down the list, I outlined in my opening statement let 
us talk about weatherization grants and why is the pace so slow 
in getting these funds out, and why are there still unresolved 
tax issues for the smart grid grantees, more than a year later 
after we enacted that?
    The big question, why is the Department requesting any 
funds for weatherization grants when you have $4.5 billion from 
the Recovery Act, in addition to the fiscal year 2009 and 
fiscal year 2010 appropriations that have piled up that have 
not been spent? You have got more than $5 billion in total, and 
yet you are asking for more with all of these delays. Can you 
help us understand all that?
    Secretary Chu. Well, it is not that we wanted to put pain 
on ourselves.
    Seriously, let me tell you about the weatherization grants. 
As you noted, it was $5 billion. It is a formula block grant. 
It goes to States.
    There were beginning hiccups. The biggest hiccup was the 
Davis-Bacon wage issue. That had to be resolved with 
cooperation from the Labor Department. The Davis-Bacon issues 
took a longer time than either Departments had expected, but 
those are resolved.
    So what has happened up until the end of 2009, I will agree 
with you that initial progress was slow. Starting in September 
2009, we started urging the States and tried to help them 
accelerate their costing of the funds. We believe that apart 
from a few States, they are getting on track to up the 
spending. This is demonstrated by what we now have in January.
    We went from quarterly reporting to monthly reporting. 
There was resistance both by the States and by others, 
Paperwork Act issues. But what we found is, as we started to 
move into monthly reporting, those States that were the 
furthest behind actually started to move.
    So a number of things like that were holding us up.
    There is an IG report that perhaps you have read which I 
think gives a very balanced view of why initial progress was 
delayed. It does indicate that the Department of Energy was 
doing everything within its power over the last 6 months to 
help the States get this money out.
    Now, in answer to your question, why are we asking for more 
weatherization money--there are other programs we have now 
begun. The weatherization money is for low-income housing. It 
will weatherize within the low-income housing sector, perhaps 
500,000 to 600,000 homes. The sector in the United States--
there are 130 million homes of which probably 80 million to 90 
million homes could benefit from weatherization.
    What we are now trying to do is start programs that will be 
largely highly leveraged, ideally self-financed because energy 
efficiency really does mean energy savings. And we want to 
start programs and we are beginning to pilot some of these with 
our current weatherization money to get this going in the 
United States.
    So ultimately, we feel that energy efficiency should be a 
social norm, but fundamentally it saves money and that money 
goes in the pockets of homeowners and businesses and it goes 
back into the economy.
    Very quickly, the tax issue with the Smart Grid is being 
resolved. That is something we have to negotiate with Treasury 
and other agencies. We hope, perhaps within a few weeks, that 
will be completely resolved and we can go forward.
    Senator Bennett. Okay.
    Well, do you still think then that the appropriations you 
are asking for is necessary to reach that goal? And with all 
the money you have still got, you----
    Secretary Chu. Yes. Despite the slow start, the goal we 
have is that by 2011, mid-2011, we will have costed the money. 
It has essentially all been allocated.
    But again, it takes time to start these programs. Once 
these programs have ramped up, you have got people. You have 
got caulkers. You have got insulators. You have got energy 
auditors out there. You want to keep the momentum going. We 
have ramped up. And we need to sustain that.
    Senator Bennett. Is there a ceiling? You talk about 
primarily low-income housing. Is there an income ceiling where 
we say, well, if you earn this much, the Feds will not 
weatherize your home? That is your responsibility.
    Secretary Chu. In the current weatherization statute, there 
is. It is 200 percent above the poverty level. And most middle-
income homes cannot be touched by that. And so that is, again, 
why we think eligibility for weatherization funding essentially 
could be expanded to mid- to low-income housing.
    Senator Bennett. I have some constituents that will raise 
questions about the constitutionality of that.
    Secretary Chu. Of the Recovery Act?
    Senator Bennett. No, of saying, okay, the Federal 
Government will use Federal power and Federal dollars to do 
this for one portion of the citizenship and not the other. But 
that is a constitutional question for another time.
    Secretary Chu. Right. By the way, that is in the Recovery 
Act. The weatherization program we are proposing does not have 
that ceiling.
    Senator Bennett. Okay.

                            LOAN GUARANTEES

    Let us talk about the loan guarantees. DOE had planned to 
make a minimum of 21 condition commitments for projects 
supported under the Recovery Act by the end of 2009. Instead, 
you have made a total of four, and you made some additional 
commitments since then but still far short of the target.
    Can you tell us what the problems are there in terms of 
meeting the plan----
    Secretary Chu. Sure.
    Senator Bennett [continuing]. And what steps are being 
taken?
    Secretary Chu. If you include the Advanced Technology 
Vehicle Manufacturing loans, I believe we are up to 11 since 
the first conditional loan was announced to Solyndra. As you 
pointed out, the loan program was authorized in 2005. I believe 
it was appropriated in the beginning of 2006. And when my team 
took over in 2009, not a single loan had gone out. So we have 
made 11. There are more in the pipeline to be announced soon. 
We are spending a lot of time thinking about it--so we went 
from 0 to 11 or so.
    We are examining how to streamline the processes. There are 
issues in terms of legislative fixes. For example, the 1705 
loan program, could also allow loans to energy efficiency 
technologies and energy efficiency companies. Right now it is 
limited to renewable energies--because there are a number of 
loan applicants that we think would be well qualified.
    The issues with the loan programs are fundamentally, given 
the way it is constructed, we are obligated to protect the 
taxpayer, which means that there are negotiations to find out 
what these companies have in their assets, and assess the 
ability of the companies to repay the loans. For example, if 
one compares the first nuclear loan we gave, which these are 
solid companies with a lot of assets, minimal credit subsidies 
are required. So those loans we believe are very solid. The 
probability of payback, costing nothing to the taxpayer, is 
quite high. In fact, we have made the case to OMB that it will 
cost nothing to the taxpayer.
    Senator Bennett. Let me give you a particular example. 
AREVA in Idaho submitted an application years ago for a front-
end nuclear fuel project, was given every indication, I 
understand, back in October that due diligence had been 
completed and word would be coming any day. And now we are in 
March and they are still waiting.
    Do you have any idea why that particular one has been held 
up so much? That is in the West in the area where I am 
concerned.
    Secretary Chu. We are closing in on that. To be quite 
candid, sometimes the delays surprise me a little bit, but 
until I get into what the delays are about, the nuclear loans--
I personally thought the first nuclear loan could have been 
announced--I thought it would have been announced by November. 
So these are very big deals, hundreds of millions of dollars to 
billions of dollars, and there are complications. But we are 
closing in on the AREVA one as quickly as we can.
    Senator Bennett. Thank you, Mr. Chairman.
    Senator Dorgan. Thank you, Senator Bennett. We will come 
back to you if you have additional questions.
    Senator Reed, I want to go to you and then Senator Tester 
has indicated he will close. We will come back to Senator 
Bennett. But Senator Tester is going to close the hearing as 
well. So we will have ample time at the end of the hearing.
    Senator Reed.
    Senator Reed. Thank you very much, Mr. Chairman.
    And thank you, Mr. Secretary.

                          OFFSHORE WIND POWER

    As you know--and we have had a chance to talk about the 
aspects of this--my State, Rhode Island, is deeply committed to 
wind power, offshore wind power, not only for environmental 
reasons, but also for economic reasons. We have 13 percent 
unemployment and this could be a way to help us move forward in 
the future. The State, through the great help of the chairman, 
has received money to conduct an ocean special area management 
plan to assist in siting offshore wind projects. They are well 
positioned to do that. They have a selected contractor, 
Deepwater Wind, and we hope we can do this. We are working hard 
with not only DOE but also the Minerals Management Service and 
the Department of Transportation. We have got a grant for a 
shore-side facility that could be a fabrication point.
    But I was heartened to see that your budget includes $49 
million for offshore wind technology. Can you just generally 
elaborate on what you would like to do with that? And frankly, 
if you would like to help us, that would be even better.
    Secretary Chu. The reason we have asked for this budget is 
because we believe there are a lot of resources in offshore 
wind. Now, the down side of offshore wind, as you well know, is 
that the maintenance of it is much more costly. The up side is 
that the newer turbines are getting more and more reliable. But 
fundamentally, you really want those turbines to have a mean 
time of failure that pushes 20 years because once the turbine 
goes down because of the choppy seas, it becomes very expensive 
to fix, and you cannot fix it immediately. You have to wait for 
proper conditions.
    But having said all that, the United States has incredible 
resources in offshore wind, both off the Atlantic coast and in 
some of the Great Lakes areas. We do anticipate that the 
reliability of these large turbines is going to get better and 
better and better. So we think it is now time to start getting 
this piloting going to nurture it along.
    Senator Reed. Can you comment upon your coordination with 
the Minerals Management Service, with NOAA, and with the other 
agencies, the stakeholders? Are you working actively with them 
in a----
    Secretary Chu. Well, certainly the primary coordination is 
with Interior and Secretary Salazar because the Interior 
actually controls that land. But we are very keen on trying to 
get this developed in a timely manner but that makes good 
economic sense as well. But as I said, we think it is going in 
the right direction. The other thing I should add is there are 
two other things that are good about offshore wind. First, they 
are closer to population centers, and second, you actually have 
a higher what I call duty cycle. The wind is steadier in the 
oceans. So the capital investment, the nameplate, electricity 
generation of a turbine offshore--you can actually reap more 
electrical power over a period of time.
    Senator Reed. Thank you.
    I know that your Assistant Secretary, Ms. Zoi, is very much 
interested in this, and I would encourage her to contact Rhode 
Island, perhaps even visit, to see what we are doing. That 
might help sort of this whole process of coordination.

                  INTERNATIONAL WIND POWER TECHNOLOGY

    My final point--and this has been an issue that has come up 
in the context of the recovery plan. Because other nations have 
been much more aggressive in promoting wind power, the 
consequence is that they have a lot of this technology. We are 
sort of in an unfortunate position of trying to harness wind 
but having to rely upon foreign-produced and fabricated 
turbines, towers, et cetera.
    One of the questions is not only getting the wind towers up 
but how can we help jump start the industry here in the United 
States. In the longer term, we want the good, clean energy but 
we want the jobs as well. Is that consciously being considered 
by you and your colleagues?
    Secretary Chu. Very much so. Thank you for giving me this 
opportunity to explain some of this.
    Because of long-term fiscal policies in Europe in the 1980s 
and 1990s, the technology for wind migrated from our shores to 
Europe, Germany, and Denmark in particular. Right now, as we 
show that the United States is getting serious about deploying 
wind that migration is reversing. So what is happening is many 
of these companies--for example, Vestas. I toured a Vestas 
plant. They are investing hundreds of millions of dollars and 
plan up to $2 billion of investment in Colorado to serve the 
entire North American region.
    Now, it is Vestas-United States. Right now, the value of 
the turbines being produced in Vestas is over 50 percent. It is 
something like 60 percent of all the material is being produced 
in the United States with their goal of getting it over 80-90 
percent.
    There is a very sound, economical reason why they want to 
do this. You want to set up a manufacturing plant where the 
market is stable so the company is not liable to currency 
swings. It is a more predictable business model. You want to 
set up local supply chains because it actually makes good 
sense. It is less costly.
    They said the only aspect where they do not think they can 
have a U.S. supplier, but it might take a year or two, is the 
paint. They have to get the paint from Germany. This is a very 
special, long-lived, very durable paint. But they said we are 
trying to qualify some U.S. paints.
    So the idea of these companies--it just like GM makes a 
manufacturing plant in China. They have the same motivation. 
Currency swings, local suppliers, all these other things. So if 
the United States puts in fiscal policies that allow a market 
to flourish, the manufacturing will naturally migrate to the 
United States and the parts will migrate to the United States. 
So I think there is a lot of people out there who say, well, 
wait a minute. This is a foreign company. But you know--all the 
labor and the installation will be in the United States. If 80 
percent, 70 percent of the parts are in the United States, 
which is not that dissimilar from you buy a car from Chrysler 
and ask how many parts are made in the United States. It could 
be 70 percent, maybe 80 percent.
    So what happens is that is sort of the goal we are going 
to, and that is actually what these wind manufacturers want to 
do as well. So again, a market pool means they will invest in 
the United States which means jobs in the United States.
    Senator Reed. There is another aspect, I think, with the 
offshore, is that because of the large size of these towers and 
blades, et cetera, to transport them from the interior of the 
country is very expensive and impossible because of the 
constrictions of roads. So there is an opportunity again in 
Rhode Island to have the fabrication right there, not just for 
Rhode Island, but for the entire east coast.
    I agree with you in the sense that initially there might be 
some significance of overseas products, but eventually I think 
that we can find capable American vendors.
    So again, I think we should pursue this on all fronts. 
Thank you, Mr. Secretary.
    Secretary Chu. Thank you.
    Senator Tester [presiding]. Thank you, Senator Reed.
    Thank you for being here, Secretary Chu. I have a few 
questions.

                               HYDROPOWER

    First of all, as you well know, Montana covers the gamut 
for energy production from renewable to conventional sources. 
One of the areas that we produce a lot, as in all of the West, 
is in hydropower. In fact, in 2007, I believe about 40 percent 
of our electricity was from water. We have a lot of opportunity 
with water, a lot of opportunity that has not been tapped yet 
in smaller projects that will produce smaller amounts of 
energy, but if you get enough of them, it will produce a lot of 
energy in hydro whether it is irrigation ditches or low-head 
hydro, whatever it may be.
    The DOE's power budget in hydro has been cut by about 20 
percent. And correct me if I am wrong. And I was wondering why 
that is the case, if there is a lack of opportunity in hydro 
from the Department's standpoint or whatever the reason might 
be.
    Secretary Chu. Well, on this subject, I would certainly be 
willing to work with you on hydropower. I do believe hydropower 
is proven technology. It is clean. A DOE internal study said 
that we probably have 70 gigawatts additional hydropower by 
just replacing turbines with more efficient turbines, putting 
turbines on flood control dams, and under the river. So that 
means no large new reservoirs. That is a lot of power. That is 
a lot of clean power. So I will certainly work with you and 
your staff on----
    Senator Tester. Thank you. And the bottom line is you do 
not see that potential cut reducing our options when it comes 
to hydro?
    Secretary Chu. As I said, we can work with you on 
developing a compromise.
    Senator Tester. Okay, sounds good.

                          ENERGY INDEPENDENCE

    Some of the previous questioners talked about energy. The 
chairman talked about hydrogen fuel cells and other things, and 
you talked about technology being off a long ways in many 
areas.
    I am curious to get your perspective as to whether you see 
this country ever becoming energy-independent. Is that within 
our wherewithal?
    Secretary Chu. Well, completely energy-independent--it will 
take some decades, but certainly decreasing our dependency on 
foreign oil is something that I believe we can do, as everyone 
in this room well knows, oil especially, since we are now 
importing about 55 percent of the oil. So a strategy of better 
fuel economy, biofuels, electrification of vehicles, all those 
things will decrease our dependency.
    Senator Tester. What is the major roadblock in--let us just 
take transportation fuels, as you had mentioned, where we 
import 50 percent. I have actually heard higher numbers than 
that.
    Secretary Chu. Fifty-five.
    Senator Tester. What is the major roadblock with achieving 
our independence with transportation fuels in a faster way, and 
does this budget address that roadblock or those several 
roadblocks?
    Secretary Chu. Well, I think it does. I think of those 
things that I told you about--now, I think the oil and gas 
industry, in developing domestic sources of supply, and they 
are large, successful, well-funded companies. And so we believe 
that especially the oil industry has the wherewithal to do 
this.
    We feel the Department of Energy's role--and this goes to 
Ranking Member Bennett's question as well--is to look at 
research in developing unconventional sources like natural gas 
sources before the industry wants to pick it up. Shale gas is a 
prime example of that. We started investing in shale gas 
research in 1978, stopped it in 1991. In 1990, Schlumberger 
picked up research on shale gas. And so that transition over to 
commercial companies is what we want to see. If it is a very 
beginning, very researchy thing, we say, okay, let us do that, 
but as soon as the oil and gas industry begins to pick it up, 
then we say, let us invest in other things.
    Senator Tester. Okay. I have got a bunch more questions, 
but I am going to be here for a while so I can come back.
    Senator Murray.
    Senator Murray. Thank you very much, Mr. Chairman. You look 
great in that seat.

                             YUCCA MOUNTAIN

    I want to thank Secretary Chu for coming today, and I want 
to start out by asking you a few questions about some decisions 
that the administration has made on Yucca Mountain that I have 
been very dismayed by, including the decision that was made 
just yesterday to withdraw your Department's Nuclear Regulatory 
Commission license application for Yucca Mountain.
    Now, I have read your written statement, and I have to say 
I think there is really something missing. Three times in there 
you say that Yucca Mountain is ``not a workable option for 
nuclear waste disposal.'' But what seems to be missing is the 
why, and that is really an important question and it is one the 
communities around the country, including in my home State in 
the tri-cities area, people who have really borne the burden of 
producing and cleaning up this nuclear waste, deserve to have 
answered.
    So I wanted to ask you today who was consulted in making 
the decision that Yucca Mountain is no longer a viable option.
    Secretary Chu. Well, one has to go back and look at the 
entire history of the choice of Yucca Mountain, the Nuclear 
Waste Act, all of those things. What one finds is that other 
things, other knowledge, other conditions, as they evolved, 
made it look increasingly not like an ideal choice.
    Senator Murray. Was there scientific evidence that was used 
in determining this?
    Secretary Chu. Well, it is an unfolding of issues that 
continued, and I would be happy to talk to you in detail about 
some of the issues. But the President has made it very clear 
that it is not an option.
    Senator Murray. Was there any scientific evidence that was 
used?
    Secretary Chu. Well, let me give you one example. The 
conditions in Yucca Mountain initially--and then they were 
changed--the Supreme Court ruling says that it is not 10,000 
years. It could be up to a million years. Then all of a sudden, 
that puts a new dimension on Yucca Mountain. Climate is hard to 
predict over a million years.
    Senator Murray. For any site.
    Secretary Chu. Right, for any site.
    Senator Murray. So why was Yucca Mountain different?
    Secretary Chu. Because there are other geological sites 
where we can do radioactive dating and we know they are 
inherently stable. Let me give you one example. There is a salt 
dome site--these things have been around for tens of millions 
of years. The difference with salt dome sites is you stick 
radioactive waste in there. The salt diffuses around it. Even 
though the continents are drifting all around the globe, those 
things have been stable for tens of millions of years, up to 
hundreds of millions of years. That is a very different type of 
site than Yucca Mountain which has fissures and that rock can 
be saturated with water if the climate changes.
    Senator Murray. Well, did your Department ask for input 
from communities like Hanford where waste destined for Yucca 
Mountain is currently temporarily being stored?
    Secretary Chu. No, we did not, but we take our 
responsibility for the waste problem at Hanford, Washington, 
and all the States very, very seriously. We believe that we can 
handle that.
    But again, let me just continue and go back to the Yucca 
Mountain. So all of a sudden, something changes and you say, 
well the fix is a multi-multi-billion-dollar titanium shield 
that is installed under the ground for Yucca Mountain. So then 
as these things go on, you are beginning to think are you 
beginning to pour good money after bad.
    So the whole intent of the blue ribbon panel is to step 
back and look at it. Why were the salt domes ignored in the 
past? Well, initially if you put them in the ground, the salt 
oozes around it and closes, you cannot get it back. So this 
long-term geological repository where you cannot get it back is 
actually in a certain sense an ideal place for long-term, 
forever waste disposal, geologically stable over tens of 
millions of years, cannot get it back. So that is the intent of 
the blue ribbon panel.
    Let us step back----
    Senator Murray. But I would assume that a blue ribbon panel 
would not just say we are going to take this one off the table. 
We are going to look at other ones that we have not spent a lot 
of money on, and they could have problems too.
    You know, over the last 30 years, Congress, independent 
studies, previous administrations have all pointed to and voted 
for and funded Yucca Mountain as the Nation's best option for a 
nuclear repository. In concert with those decisions, billions 
of dollars and countless work hours have been spent at Hanford 
and nuclear waste sites across the country in an effort to 
treat and package nuclear waste that will be sent there. 
Without a repository, these sites and communities that support 
them have now really been left in limbo.
    The question I want to ask you is what are you going to say 
to these communities today about why you have decided to go 
back on nearly 30 years of planning? And what can you do to 
assure them that the sites that they are now working to clean 
up will not become the final repository for this waste because 
we have taken some options off the table?
    Secretary Chu. The Department of Energy has a legal 
obligation to move that material. We take that obligation very 
seriously. So I think that is the assurance. There is more 
assurance as you well know. There are ways of dealing with it 
if we fail to live up to our responsibility.
    But going back to this issue of Yucca Mountain, we believe 
we have a path forward. We have a very distinguished bipartisan 
panel that is charged with review. They are going to be meeting 
at the end of this month, and the two chairs are very eager to 
get on with it and to give advice to me, the President, and 
Congress which could include advice on changes in the 
legislation to allow for a comprehensive, sensible approach to 
the back end of the fuel cycle.
    Again, Yucca Mountain is not the ideal site, given what we 
know today and given what we believe can be developed in the 
next 50 years.
    Senator Murray. Well, this is really disturbing to me 
because now we have pushed this down 2 more years and we have 
taken one of the sites off. You have told them do not even look 
at this in comparison to all these other ones you are going to 
look at. This leaves everybody just in complete limbo after 30 
years of working on this, and I would like to ask you to 
provide this subcommittee and my office with an impact analysis 
which includes the cost and schedule impacts to Hanford cleanup 
and the other nuclear sites in my State.
    Secretary Chu. All right.
    Senator Murray. I just think it is irresponsible for the 
Department of Energy to discontinue the Yucca program 
altogether, its funding, licensing, and design. I believe that 
this has to be a decision based on science and moral 
responsibility. We have to clean up this waste. It has to go 
somewhere and we cannot just unilaterally take one site out of 
the equation when we are looking at where this is going to go 
or we are going to find ourselves 2 years down the road in this 
same place and all the waste sitting in Hanford that is 
temporary storage is going to have no further answer. So I am 
really disturbed about this and want to get that information 
from you.
    Mr. Chairman, if I could just have one more question here.

                           LEGACY MANAGEMENT

    On the whole issue of EM, last year I wrote a press report 
that EM was going to be cut by $1 billion. Now, fortunately, 
that did not happen. But the funding still for this fiscal year 
is inadequate to meet all the needs at Hanford. Particularly I 
am worried about the $50 million shortfall for groundwater 
cleanup. This is really frustrating. I know there were 
increases in other parts of the energy budget. You know, all 
the new stuff out there is wonderful. We all want to fund it. 
But the legacy projects within DOE are absolutely critical, and 
these budgets are not put together just by wishing or magic. 
DOE works with the regulators. They work with the communities. 
They agree on the milestones and parts of those are the funding 
requirements that Congress then has to follow up with and the 
administration has to pay for. And we have got to have a 
Government that backs up its promises and commitments with real 
money.
    So I just wanted to ask you, while you were here, how a 
base budget that is inadequate to meet the work plans 
illustrates a commitment to these communities that we are going 
to clean up these sites.
    Secretary Chu. Well, Ines Triay, my Assistant Secretary for 
Environmental Management, tells me that the budget request of 
roughly $6 billion is adequate to meet our legal obligations. 
As you know, I have consistently fought to sustain these 
programs.
    Senator Murray. Well, we still have shortages in some 
areas. Truly, you were out. You visited Hanford. It is an 
enormous site. It is a legacy project from another war, and we 
cannot ignore it and we have to meet the milestones and we need 
to fund it. I appreciate that the billion-dollar cut did not go 
through, but we still have some shortfalls.
    And I am worried about next year too because everybody 
keeps thinking, well, nobody will pay attention to these EM 
projects out there. If we do not pay attention to those, if we 
do not meet the milestones and the legal obligations, the 
disaster that will hit this country is much, much larger than 
the cost that we have today. So we have got to keep those 
commitments.
    Secretary Chu. Mr. Chairman, can I have 30 seconds.
    We are maintaining the budgets, but it is much more complex 
than that. We are working very hard to make sure that the 
contractors can do better than they have done in the past. 
Senator Bennett had noted that many of the things in the 
Department of Energy have been over budget, over time. It is 
actually true of EM. It is not true of the Office of Science. 
And so when I walked in the door, since the Office of Science 
actually does big projects on budget, on time, the best 
practices in that office now are being actively transferred 
over to Environmental Management and a little bit to NNSA. So 
we are working very hard to make sure that every precious 
dollar that we are spending in EM goes as far as it can. That 
is the other way we hope to accelerate these processes.
    Senator Tester. Senator Landrieu.
    Senator Landrieu. Thank you very much.
    And Mr. Secretary, thank you for your leadership at this 
quite exciting and uplifting time in this particular area for 
our country and the world.
    I have three questions. I am going to try my best to get 
them all in.

                              NATURAL GAS

    As you are aware, Louisiana has been at the center of a 
domestic energy revolution as it pertains to the shale gas 
revolution. This technology, new technology, has unlocked shale 
gas resource space. The United States suddenly finds itself 
with four times the volume of gas than we thought we had just a 
few years ago.
    I want to ask you what you think about the implications of 
these natural gas finds both onshore, which are pretty 
extraordinary, as well as our continued exploration and 
discovery offshore.
    And as you may be aware, the Congressional Research Service 
recently released a report that said simply by utilizing 
natural gas-fired plants that are constructed today, as opposed 
to other plants, to fill the energy needs today, we could 
reduce our greenhouse gas emissions by 19 percent. I found that 
quite startling and encouraging.
    So could you comment on how this new discovery, new 
technology is informing your thinking as you move forward?
    Secretary Chu. Well, the ability to recover gas from shale 
rock is something that opens up the possibilities. I do believe 
that natural gas is a necessary transition fuel to a low-carbon 
economy. Right now, if you burn natural gas compared to 
uncaptured and sequestered coal, it is about a factor of 2 less 
carbon dioxide per unit of electricity generated. So that is 
good.
    But let me also add that in order to reach the climate 
goals we need in the world, by mid-century we are going to be 
having to capture the carbon from both natural gas plants and 
coal plants.
    The discoveries and the demonstration of recoverability is 
something which will hopefully keep the natural gas prices 
down, and for that reason--the biggest uncertainty, as you well 
know, to a power company is the volatility of the natural gas 
prices.
    So now, I heard slightly different numbers, between a 3 
percent increase to doubling of the natural gas reserves 
because of the shale gas. But no matter, let us take doubling 
as a compromise. That is a lot. It means that we probably have 
natural gas supplies that could last a century. So these are 
good things. We still want to use that more cleanly.
    I should also add that natural gas is also a transition 
fuel for a different reason that is probably not appreciated. 
If you have renewable energy, sun and wind, within a matter of 
minutes to hours, that generation can literally disappear. You 
can Google Bonneville Power Administration, and they give the 
last 7 days of wind production, and it is a running clock 
updated every minute. And it wobbles up and down.
    Now, when the wind stops blowing or tapers off, you have 
minutes to perhaps an hour to respond. And in so doing, you 
asked what sources of energy can respond; hydro and natural 
gas. One does not ramp up nuclear powerplants rapidly, nor does 
one want to ramp up coal plants. So for that reason, the rapid 
response of natural gas is something that is also part of the 
transition.
    Finally, let me add one of the technologies we are looking 
at, which is compressed air storage. You take wind or other 
renewable energy or even nuclear energy at nighttime, you use 
that. You compress air. You bring the air back and help it spin 
a turbine, but you want to use natural gas to boost it. Now, 
the wonderful thing is you can probably--70 percent of the 
electricity needed to compress the air, pump it into a cave and 
have it come out can be used to generate electricity. You only 
lose 30 percent and some people say, with newer designs, 
perhaps even less. So there again, natural gas has a role in 
actually helping generate renewable energy use. So these are 
all reasons why----
    Senator Landrieu. Well, I really appreciate that because, 
as you know, Senator Saxby Chambliss and I have formed the 
Natural Gas Caucus and it is not because we are anti-oil or 
anti-coal, which we also represent the interests of oil and 
coal and want to make sure that they have a place in the 
future, as they have had significantly in the past and the 
present.
    But we think the properties and the potential for natural 
gas are very significant, and I am very grateful for you 
basically outlining two or three, not the least of which could 
potentially be using natural gas, compressed natural gas in 
vehicles, which brings me to my next question. And I appreciate 
that.

        ADVANCED TECHNOLOGY VEHICLES MANUFACTURING LOAN PROGRAM

    Your Department is leading the effort to disburse $25 
billion in investments, which score to our budget at about $7 
billion, but it is significant for new vehicles, the program 
you recently announced. As you know, many States have an 
interest, and Louisiana has been working in conjunction with 
our Department of Economic Development on an exciting potential 
new model for a vehicle that is in the queue for support.
    Can you just give an update about that program? I 
understand you have $25 billion to allocate. You might have 
done this in your opening, and I am sorry if I am going over 
ground already covered. But kind of an update of where you are 
and what is your general view of the kind of applications you 
are seeing. Are you excited about what you are seeing? Are you 
encouraged? And then any particular comments on the Louisiana 
proposal I would appreciate hearing.
    Secretary Chu. Well, just as a point of information, are 
you asking a question about our overall advanced automobile----
    Senator Landrieu. Yes, automobile program, the ATVM 
program.
    Secretary Chu. Yes. I am seeing some very good signs.
    We, in some sectors, had fallen behind other countries in 
the most advanced fuel-efficient vehicles, but I think the 
American car manufacturers are determined to catch up and 
surpass them. There are developments across the whole gamut, 
from improvements in conventional internal combustion and 
unconventional internal combustion in the sense of direct fuel 
injection. Much more economical engines.
    Electrification, the weak point is the batteries. Both the 
major car manufacturers and little start-ups, I think, have 
made progress. I would be personally hopeful that within a few 
years the energy density in batteries could double, but we 
actually need, I believe, perhaps a quadrupling of the energy 
density before it is simply adopted mass market. So you have 
the range and the battery does not take up the space that the 
current batteries do take up.
    We are in the process of developing--again, since this is 
research and development, one cannot give a timeline--batteries 
that also last much longer. The Prius battery, the current 
metal hydride batteries in a Prius are kept within 10 percent 
of half charged. They are 55 percent to 45 percent. If you take 
that battery and drain it deeply and then recharge it, the 
lifetime goes down very quickly and you probably had that 
experience in your own laptop computer. If you drain the 
battery hundreds of times, you will find that that laptop 
battery no longer has the capacity it once did, let us say, a 
year or 2 ago. So the lifetime of the battery is an issue. You 
want the battery to last the lifetime of the car.
    Senator Landrieu. Thank you. I know my time is up, but Mr. 
Secretary, the battery technology is so interesting for all of 
us, but there are opportunities for plug-in, opportunities for 
new infrastructure for plug-in, with the current battery 
technology that we have now. Is that not correct?
    Secretary Chu. No. I think the Chevy Volt battery takes up 
a huge part of the car, and so GM started this where they went 
in with the intent of developing the technology more 
aggressively. So as the Chevy Volt and the Nissan LEAF and all 
these other--well, the Nissan LEAF is not a plug-in hybrid, but 
the Chevy Volt is. So of the plug-in hybrids, we still have 
room for improvement. Again, I think the good news is that it 
is happening. The development of batteries has accelerated.
    Senator Landrieu. Well, thank you very much and thank you 
for your focus on our program which is a little different than 
the electric vehicles but we think extremely exciting and the 
possibility. So thank you for your attention and your staff's 
attention.
    Senator Tester. Senator Alexander.
    Senator Alexander. Thanks, Mr. Chairman.
    Dr. Chu, I want to thank you for your exceptional service 
in your job and complement the President and you on his recent 
comments on nuclear power. I completely agree with Senator 
Murray about Yucca Mountain, but the President's comments about 
a new generation of nuclear power, the quality of his nominees 
and appointees for the Nuclear Regulatory Commission and for 
the Commission on Recycling Used Fuel, the approval of the loan 
guarantees. All are an important step forward in that, and I 
know you played a major role in it and I congratulate you for 
it.

                            LOAN GUARANTEES

    Do you think it would be a good idea over the next few 
years for Congress and the administration to move toward a 
technology-neutral, low-carbon set of short-term subsidies, 
policies, loan guarantees and standards rather than picking and 
choosing individual types of clean energy?
    Secretary Chu. Yes and no. If you have a very new 
technology that you think over a period of 10 or 20 years could 
become competitive, then it does make sense to nurture that 
technology. Under no circumstances, I believe should you 
nurture a technology where you say over this time period--let 
us say 10 or 15 years--where it would need subsidy forever. But 
virtually every technology, as it begins and emerges--and it is 
also true of nuclear--wind, solar--these things needed a little 
nurturing, but then after a while you say, okay, eventually you 
have to stand on your own and you have to know that you are 
going to have to stand----
    Senator Alexander. So after a while we get to it.
    We did a little computation of--we asked the Energy 
Information Administration--wind power gets 25 times as much 
Government subsidy per megawatt hour as all other forms of 
electricity combined. You know, we put in a production tax 
credit in 1992 and it just keeps going, and we had four 
Democratic Senators yesterday point out how $2 billion in 
stimulus funding was creating jobs in China to build wind 
turbines, which they did not like.
    So that is why Senator Webb and I on our loan guarantee--I 
am very delighted with your approval of loan guarantees for 
nuclear. But in our legislation, we make it for all low-carbon 
forms of energy. So there is some subsidy, some policy, and 
some standard. The renewable fuel standard, for example, 
excludes nuclear power and some other forms of clean energy and 
in a way distorts the market, making it more difficult for 
investor-owned utilities to build nuclear plants based upon 
market-based decisions.

                             NUCLEAR WASTE

    But if I may keep going so I do not take too much time 
here. I mentioned the quality of your appointees to the 
Commission on Used Nuclear Fuel. While you decide what to do, 
you can still continue aggressive research in the recycling of 
used nuclear fuel. Can you not? And do you plan to do that?
    Secretary Chu. Yes. We have a budget of over $400 million, 
close to $500 million that we have proposed to Congress. 
Included in that budget are new reactor designs that could 
potentially burn down, harvest much more of the energy content, 
small modular reactors, beginning with conventional light water 
but going forward where these small modular reactors would be 
totally prefabricated and built in a factory and shipped 
successfully in the United States where the location of a 
powerplant could not handle a 1.5 gigawatt power line, many, 
many things like that.
    Included in that is research in reprocessing fuel, a well 
as research in advanced reactors with higher energy neutrons 
that can burn down the long-lived waste. The whole idea there 
is to greatly reduce the amount of nuclear waste to greatly 
harvest much more of the energy of the uranium, all those 
things. So we plan a very comprehensive program going forward 
in all those areas.
    Senator Alexander. Senator Bond has an interview he wants 
to get to. So I will not ask you to answer any of these, but I 
will state these questions quickly.
    I would like to ask you to respond to a question about what 
you think the risk of loss is for the loan guarantees for 
nuclear powerplants. I think it is small. Others have said it 
is large.
    Second, I hope that you will keep high on your agenda the 
uranium processing facility at Oak Ridge which this 
subcommittee approved design for, and the sooner we get it 
done, the quicker we can reduce the annual overhead costs at 
Oak Ridge.
    Third and finally, I hope you will keep in mind the 
efficiency of third-party financing for facilities at places 
like the Oak Ridge Laboratory in Y-12. We can build buildings 
cheaper and faster if we allow other people to build them and 
rent from them. Sometimes that gets hung up in the Department 
of Energy or the Office of Management and Budget. We have had 
good success with that at Oak Ridge, and I hope when that comes 
before you, that you will pay close attention to that.
    Thank you very much.
    Senator Tester. Senator Bond.
    Senator Bond. Thank you very much, Mr. Chairman, and the 
ranking member, my particular appreciation to my colleague from 
Tennessee. This is one of those days when if we were cloned, we 
would still be about two places short. I thank you very much 
for letting me discuss these issues.

                           COST OF GREEN JOBS

    I agree with Senator Alexander that we need to begin taking 
a look at the economics of wind power. I had a private sector 
contractor in my office yesterday saying wind power is very 
expensive. It is not worth the cost, but we love it because 
every time they build a wind power facility, we get to build a 
natural gas facility beside it for peaking power. So we make 
money off of it, but it is not a good investment for the 
taxpayer dollar. As I look at the $20 a megawatt subsidy plus 
some figures that we have developed, I think that we need to be 
very careful about where it is efficient and effective to use 
wind and solar power.
    Our Missouri National Guard team and others in Afghanistan 
are using solar power to power re-pump facilities to fill 
reservoirs. It makes sense. Whenever the sun shines, they can 
pump water, but trying to put it on the grid does not work.
    But when you come to the stimulus dollars, I think we are 
talking about green jobs, but when families are struggling to 
make ends meet and workers to find and keep jobs, I think it is 
important that the American people know that the so-called 
stimulus funds to stimulate jobs in America, being put on the 
credit cards of our children and grandchildren, are actually 
stimulating jobs here. And too often they are not doing it.
    I serve as the ranking member on the Green Jobs and New 
Economy Subcommittee of the Senate Environment and Public Works 
Committee. We examined this issue last month and I examined the 
issue last year and found out that most of the so-called good, 
high quality, new manufacturing jobs are going to Asia where 
labor costs are a fraction of the U.S. salaries, energy costs 
are low, environmental regulations are nonexistent. So there 
are some U.S. construction jobs to put up wind or solar plants 
and a handful of remaining operations jobs. The good paying 
manufacturing jobs are going to Asia, not the United States.
    FirstSolar, a company that manufactures solar panels and 
equipment, testified before our EPW Committee advocating for 
more Government green job spending. No wonder. What they did 
not admit was they are sending all of their new solar 
manufacturing jobs to Malaysia. And as the chart here shows, 
that is where they are going to go. That is where we are going 
to stimulate it.




    eSolar testified that they are developing solar powerplants 
in the California desert. It is another company. What they did 
not admit is that most of their manufacturing is in China. Gear 
boxes come from Shenzen, towers from Penglai. Even the panels 
come from China. This is eSolar.




    DOE just awarded a $1.4 billion loan guarantee to 
BrightSource Energy to construct a solar plant in the 
California desert. The press release talks about U.S. 
construction jobs, but says nothing about who will manufacture 
the project's solar panels and equipment. I am concerned that 
we will discover that China is the one who is getting the U.S. 
stimulus dollars for this project.
    Now, I think we ought to be dealing more with China. We 
ought to be competing in the world market. We need more trade. 
But when we are saying that we are stimulating U.S. jobs with 
these stimulus dollars, it isn't so. We need to be trading on 
an economically beneficial basis with partners like China, but 
stimulus dollars going to China and Malaysia and elsewhere 
around the world are not meeting the test of stimulating the 
U.S. economy.
    That is why I wrote to you on November 10 expressing my 
concerns over the news report that DOE was using the funds for 
3,000 turbine manufacturing jobs in China to build a Texas wind 
farm. In case you do not have it, here is a copy of the 
November 10 letter that I still have not had a response to.
    [The information follows:]
                Letter From Senator Christopher S. Bond
                                                 November 10, 2009.
The Honorable Dr. Steven Chu,
Secretary of Energy,
Washington, DC 20585.
    Dear Secretary Chu: There is bipartisan concern that the Obama 
administration is using U.S. taxpayer dollars to fund green jobs in 
China and other foreign countries. As U.S. unemployment tops 10 percent 
during this time of economic distress for America's families and 
workers, we must ensure that our Government is not using American 
taxpayer dollars to create more green jobs in China than in the United 
States.
    My colleague Senator Charles Schumer recently wrote to you 
expressing concern over the Department of Energy's (DOE) use of 
stimulus dollars on wind projects that will benefit primarily Chinese 
workers because the wind turbines are constructed in China. He noted 
recent news reports that a Texas wind project under consideration by 
DOE would create up to 3,000 green jobs in China. I applaud Senator 
Schumer's leadership in this area and want to assure you that his 
concerns are shared by me, both as a Senator from a Midwestern 
manufacturing State and as ranking member of the Senate Subcommittee on 
Green Jobs and the New Economy.
    Senator Schumer cited a report by the Investigative Reporting 
Workshop at American University that found that the Obama 
administration has awarded 84 percent of its $1 billion in clean energy 
grants to foreign wind power companies. That is an important issue, but 
of deeper concern to me is what number of jobs in foreign countries are 
funded by DOE clean energy grants. A good-paying job located in the 
United States is still a good job, even if it is supplied by one of our 
foreign friends. However, subsidizing thousands of foreign green jobs 
is a bad use of U.S. taxpayer dollars.
    Therefore, please undertake a review of all renewable energy 
projects pending or approved by this administration to determine both 
the number of U.S. workers and workers in foreign countries they will 
utilize and supply that information to the Senate Green Jobs and the 
New Economy Subcommittee. To the extent that your review for Senator 
Schumer provides information on the use of stimulus funds in this 
regard, there is no need to duplicate those efforts. However, as a 
member of the Senate Energy and Water Appropriations Subcommittee, I am 
concerned about the use of annual appropriated funds in this regard and 
ask that you ensure that your review reflects all funds appropriated by 
Congress. Thank you in advance for your attention to this matter.
            Sincerely,
                                               Christopher S. Bond.

    Senator Bond. A recent outside investigation found that 79 
percent of nearly $2 billion in DOE wind energy stimulus grants 
have gone to foreign-owned firms. Of the 28 wind farms so far 
receiving DOE stimulus grants, over 1,200 of the 1,800 wind 
turbines installed were built by foreign manufacturers.
    Personally I am much less concerned about what companies 
are getting the funding, but if they are calling it ``stimulus 
for hiring U.S. workers,'' I want to make sure they are hiring 
stimulus U.S. workers. If they are foreign companies investing 
in the United States, great if they are hiring U.S. workers, 
but do not call them stimulus jobs if the jobs are overseas.
    That is why I asked you to undertake a review of the dollar 
spending under the stimulus and to tell me the number of 
foreign workers who would be employed. I am still waiting for a 
reply. My staff checked with your Department again in December 
and January and March, and I know others have expressed 
frustration. But I have a copy of this letter that I will be 
happy to supply to your staff, and I would like to be able to 
tell my constituents that when you put money, borrowed from our 
children and grandchildren, into stimulus, they are stimulating 
jobs in the United States.
    Now, I am not here just to complain. I want to thank you, 
as Senator Alexander did, for your commitment to loan 
guarantees to bring the best clean energy, nuclear energy on 
line. You were referencing reprocessing. We have got a 
tremendous amount of first-time spent nuclear fuel which can 
continue to be used, reducing its weight. If it is in 
Tennessee, fine, but wherever you can do it. Clinch River 
breeder reactor I believe should have gone forward.
    And for clean coal, we thank you for those efforts. 
Whatever you think about coal, I think that we have got over a 
couple of hundred years of BTU's. If we can get that started, 
that will be a long way toward meeting the needs that we have 
for energy. I appreciate that.
    And I would like to have an opportunity to hear your 
comments. Rather than asking you a particular question, I would 
like to have your assurance that you will supply us information 
on the foreign jobs and what we are doing to see that if you 
are calling them stimulus jobs, they produce jobs in the United 
States. So I might ask you that and ask you for your comments 
on the many issues I raised.
    Secretary Chu. So very quickly, thank you for your support 
on the nuclear energy sector.
    The wind turbines that are being--first, this famous 
example of the China wind farm in Texas--I keep on asking my 
people, have we gotten an application for a grant on this, and 
they keep on saying no. So all I can say is although that has 
gotten a lot of press coverage, we have not gotten an 
application for a wind farm made with China parts in Texas.
    With respect to the stimulus jobs, yes, the stimulus and 
Recovery Act is all about giving jobs in America. I absolutely 
agree with that.
    The wind turbines that are constructed now in America--part 
of the parts are from abroad, part of the parts in the United 
States. The value of the parts in the United States is 50-60 
percent and climbing. And we are working toward getting that 
fraction up higher and higher.
    I mentioned before that I toured a Vestas plant where they 
are investing--I think it is a total now of maybe $600 million 
in a factory in the United States for manufacturing wind 
turbines in all of North America. They are up to 70 or 80 
percent American-made parts. And of course, when you install 
the turbine, it is American workers. Seventy to 80 percent is a 
good number because if you look at an American-made automobile, 
a Chrysler, for example, that is about the ratio of parts made 
in the United States.
    Now, you might ask why Vestas would want to have local 
suppliers. It is for the same reason why they want to have a 
manufacturing facility in a country that appears committed to 
wind. It is a lower cost to them. They are less susceptible to 
currency fluctuations between countries. They want to develop 
local supplier chains again because of cost/benefit.
    And because we were not a good wind market until recently, 
until the last 5 years, the turbines were developed and 
manufactured abroad. So this is part of the strategy of 
bringing them back to the United States, getting major U.S. 
manufacturer headquarters companies like GE--has come back into 
the game.
    And we will be glad to give you the details of what the 
fraction of money spent on, let us say, a wind farm is in the 
United States and where it is going. So we would be happy----
    Senator Bond. And we will share with you, as I said, the 
testimony from EPW on the plans for the people who have gotten 
the money to invest it solely overseas. And I hope that you 
will take a look at that. When they are saying, hey, we are 
going to build plants in Malaysia with stimulus dollars, that 
is a negative as far as I am concerned.
    Secretary Chu. We will certainly look into that.
    Senator Bond. Good. Thank you very much, Mr. Secretary.
    Senator Tester. Senator Bennett.
    Senator Bennett. Thank you, Mr. Chairman.

                      PROJECT APPLICATION PROCESS

    Mr. Secretary, we talked about the time necessary for 
application review, nuclear power, and so on. I just want to 
make the comment that it is my understanding that the review 
process differs by type of application. In other words, 
applicants with nuclear power generation projects receive a 
ranking from DOE before submitting a full application, but 
applicants with coal-based and other types of projects do not. 
Applicants with some kinds of technologies are allowed to brief 
DOE and explain their projects after submitting their 
applications; others are not, potentially denying them 
opportunity to clear up misunderstandings. I would appreciate 
it if you would look into this and see why applicants are 
treated differently in this regard.

                          CONTRACTOR PENSIONS

    Now, the last thing I would like to get back to and the 
point I would like to make--I talked about the major crisis 
regarding contractor pension funds. I understand you have 
changed the way you are budgeting for pensions and in an effort 
to see that it is less of a crisis, and I would appreciate any 
explanation you might have as to what you are doing with 
respect to that and what we can expect in fiscal year 2011.
    I would recommend that you ask the GAO to undertake a 
comprehensive review of the pension problem and solutions going 
forward. I intend to do that, and so whether you do it or not, 
the request will go in. So I am giving you a heads-up that I 
will be sending a letter to GAO fairly soon and would 
appreciate it if you could join me in that. If within the 
Department they think it is not a good thing to do, I will 
proceed anyway. But I wanted to let you know that that is the 
sort of thing I had in mind.
    So if you could talk about that whole issue, I think it 
would be helpful.
    Secretary Chu. I would be delighted to.
    As you correctly point out, there are huge liabilities in 
the DOE pension program because unlike pensions of other 
contractors, the Federal Government and the Department of 
Energy is responsible should those programs be mismanaged----
    Senator Bennett. You have the highest number of outside 
contractors of any Department in the Government except DOD.
    Secretary Chu. Correct.
    The CFO's office has done what I consider a spectacular job 
over the last 6 months in trying to get their hands around the 
problem. We are engaging now the contractors very actively to 
deal with the pension overhangs, especially when the stock 
market went down last year.
    We are taking a number of steps in order to make sure that 
the contractor's--there is a tight rope line here. The way the 
contracts are written--and we do not want to manage the funds 
of the contractors. However, what we can do is use the 
mechanisms we have, for example, award fees, whether there can 
be continuous contractors if they mismanage their funds because 
this is a liability. In 2009, we had budget shortfalls. Because 
of that, it required some top line transfers. So we are taking 
a much more active role in trying to spot early on what is the 
vulnerability of the pensions.
    We also want to share--there are certain contractors who 
have managed their pension funds quite well. In fact, without 
appearing provincial--I know I am going to appear provincial, 
but I will do it anyway. The University of California--they 
have managed their pension funds very well. So, for example, in 
the Lawrence Berkeley National Laboratory, the employees--it 
was so well managed that for 16 years they did not have to 
contribute anything to the pension fund because of the quality 
of the investments. This is a good thing.
    Senator Bennett. Yes.
    Secretary Chu. But I have to say other contractors did less 
well. So we are beginning to get our arms around spotting early 
and ask if the asset allocation classes make sense. For 
example, if 80 percent of your workforce is either retired or 
about to retire in 5 years, what is the asset allocation? Does 
it make sense to have 50 percent of them in equities? You want 
to start to transition to guaranteed income as an example 
because of the age of your base.
    So these are things that we are saying we want to develop 
mechanisms that essentially share best practices among the 
labs. You know, some contractors do well; others do not do it 
well. And to convince the laboratories and the contractors for 
those laboratories how important it is that everybody manage 
their pensions well because if one or two make a mistake, we 
are now talking about hundreds of millions of dollars of top 
line transfers to bail it out.
    So this has gotten our full attention and we are 
investigating it. We welcome the GAO investigation as well 
because we see this as an opportunity. They could have seen 
things we missed, but we are doing it ourselves and we are 
doing it very aggressively.
    Senator Bennett. Thank you. I appreciate the aggressiveness 
with which you have addressed that.
    Thank you, Mr. Chairman.
    Senator Tester. Thank you, Senator Bennett.

           FOREIGN PRODUCTION OF ENERGY GENERATION EQUIPMENT

    I have a few more questions. I want to start out by 
saying--it is no surprise to you--I was one of those four 
Democratic Senators that had that press conference yesterday on 
generation of equipment that was built outside this country.
    I will also say that I know you have come into this 
situation in a tough position. First of all, I think you came 
into the Department of Energy with energy policy that was 
antiquated and lacked diversity. I think for the last 30 years 
we have watched our manufacturing base leave this country 
because we have had poor policies in this country and we have 
had poor trade policies in this country. So I think it is 
patently unfair to come in and say that this is your fault 
because we are buying generators across the pond in one of 
those ponds.
    And I think you explained it very, very well when you said 
a lot of these parts are made here. We like that. And we want 
generation equipment made here. I read not too long ago that if 
one of the hydro plants went out or one of the coal-fired 
electrical generators went out, that we do not make those in 
this country anymore. That is somewhat distressing to me, and I 
know it is to you too.
    So as we move forward and we move our energy economy into 
the 21st century, I just want to express my appreciation for 
you standing up and doing the right thing, and I appreciate 
that. The press conference yesterday from my perspective was 
not a negative on you. It was a negative on where we have come 
in the last 30 years, and I do not think it has been positive.

                   ENERGY TRANSMISSION MODERNIZATION

    Getting back to your budget, I would just like to say DOE 
has got a $60 million study to look at transmission. You and I 
both know the transmission again is antiquated. We need to do 
something about that. The results for that study are going to 
come up in about 2011 or 2013.
    In the interim, we both know that there are problems out 
there with transmission. How are we addressing that issue in 
the interim for this study?
    Secretary Chu. Well, there are many issues. Over a several-
decade period, modernization of our transmission system that 
enhances its electrical reliability and also allows a diverse 
set of energies to be moving around the country--especially as 
the variable sources of energy come higher on line, will 
require a system that can automatically respond to, all of a 
sudden, several billion watts of energy going off line because 
the wind stopped blowing in a certain region, Montana, Wyoming, 
you name it. So the amount of money needed for that is truly in 
the hundreds of billions of dollars.
    Central to all these things are questions of line siting, 
right-of-way issues, of costing of the electrical lines. 
Typically the cost of the electrical lines is borne by the 
supplier, but as we enter in this new era--it used to be that 
the supplier--you build a coal plant, a gas plant, something 
like that. It is local. This is not an issue. But now all of a 
sudden, we are going to enter in an era where you are going to 
be moving energy over hundreds of thousands of miles.
    Senator Tester. And so I think the question is--I have got 
transmission projects in the State. I know New Mexico, Arizona, 
and Nevada. How do you prioritize them without this study being 
in?
    Secretary Chu. Well, again, it is a divided responsibility. 
There is the Department of Energy. There is FERC. There are 
also Federal lands. It turns out that many of the companies who 
want to string transmission lines tend to try to stay away from 
Federal lands because there is local resistance there, as well 
as local private land resistance.
    So what we have been trying to do--you know, I will be the 
first to admit I am not happy with the amount of progress, but 
Ag, Interior, the chairman of FERC, I, others, CEQ have been 
meeting over the last year to try to see how can we get this 
done in a better way. I am not completely happy with the 
progress, but this is an important point. It is not lost that 
this is a problem that needs to be solved.

           BIOMASS AND BIOREFINERIES RESEARCH AND DEVELOPMENT

    Senator Tester. Montana is no different than most of the 
Mountain West. A lot of our forests are red and dead. A lot of 
that material cannot be made into plywood or 2 by 4's or 
anything. It is non-merchantable but it can be used for biomass 
and so it can create power.
    The DOE is flat-lining the budget for biomass and bio-
refineries research and development as one of the two programs 
in the whole energy efficiency budget to not receive an 
increase. Is this a signal that biomass innovation is not a 
priority?
    Secretary Chu. No, it is a priority. It is a signal that we 
have tough choices. Again, I would be willing to work with you 
on this.
    But here, the biomass--actually, quite frankly, because of 
a lot of dead standing pine trees that are there in the West of 
the United States, there is an opportunity not only for those 
sources of biomass but also the biowaste, the wheat straw, the 
rice straw, the cornstalks, all those things we think have an 
opportunity to be harvested for energy, either electricity 
generation or fuels. So we do remain committed to doing that. 
Again, it was a hard decision that we have to sometimes make.

                             CARBON CAPTURE

    Senator Tester. I want to talk a little bit about research 
and development, and then I will let you go. There are two 
particular areas that I think research--and there are many more 
than this that are particularly applicable. Being from a coal 
State like Montana, how we capture carbon, whether we are 
making limestone out of it or putting it underground for 
storage, long-term storage is one way. I was wondering how you 
would assess our progress on that and if there are adequate 
dollars in the budget to take care of that. And are we holding 
the people who are doing the research accountable for results?
    Secretary Chu. There are dollars allocated for that 
purpose, and there are also private companies looking into 
that, taking carbon and turning it into whether it is cement or 
various kinds of things. It really is an R&D level thing. It is 
not ready for deployment. We are in piloting stages. We are 
looking at all of these things. What I would call the general 
rubric of beneficial and economic uses of carbon is something 
that we and other countries are examining.
    Senator Tester. Okay. I mean, coal is going to be around 
for a while. Is progress being made at an adequate rate that 
you are happy with?
    Secretary Chu. Well, we have invested----
    Senator Tester. A lot of money.
    Secretary Chu [continuing]. A lot of money. We have a 
number of pilot plans come forward. I am heartened that a 
number of utility companies and power generating companies are 
partnering with the Department of Energy in a major way to 
start to test the capture at scale, at the hundreds of megawatt 
level, which is really what matters. That is the really 
necessary step before you say, okay, we begin to deploy. So we 
have a number of projects that we are investing in and they are 
being done now.
    We are also investing all the way up the pipeline toward 
even better ways of capturing the carbon, either before you 
burn or after you burn. So we think with some of these new ways 
we have a potential for--you know, it is all about driving down 
the costs, keeping the energy bills as low as possible, and 
getting it as clean as possible. So we think these are good.
    Now, for those of you who do not know me that well but for 
those of you who know me when I do research and everything else 
and for those in the Department of Energy, I always think we 
can go faster and always want to go faster. But we are moving.
    Senator Tester. Well, my point is that as we deal with 
energy and climate change and all the things around that and a 
diversified energy portfolio, this is an important issue. I 
feel the immediacy. I think you feel the immediacy. I just want 
to make sure we are getting results. That is all.

                             NUCLEAR POWER

    Next question, same area, different energy source and that 
is nuclear power. You have answered many questions on it as far 
as nuclear reactor design. It is the same issue. As we talk 
about greenhouse gas from coal, we talk about nuclear waste 
from nuclear powerplants. Are there adequate dollars for 
research there so we can get our arms around that? I do not 
think we are talking about that near enough as we go forth with 
nuclear power, and that is how we are going to deal with the 
waste and if there is a solution to that waste.
    Secretary Chu. I think there are solutions to the waste and 
still ever better solutions I think can be found. So this is 
why we are putting together a long-term road map over 10, 20, 
30, 50 years in order to deal with this. Nothing in nuclear 
moves quickly. You do not get something up and proved and 
running in a couple years. I mean, just the approval process--
you have to proceed carefully.
    But we did ask for an increase. I think, as a scientist and 
a techie, there is a lot more we can do and there is a lot more 
where the technology can be improved.
    Senator Tester. I want to thank you for your testimony and 
your direct answers to the questions.

                     ADDITIONAL COMMITTEE QUESTIONS

    The record will remain open for 1 week for members to 
submit questions and comments.
    [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. How much funding is being dedicated to R&D on natural gas 
end use technologies in EERE? In particular, what is the DOE doing to 
help develop residential and commercial technologies that will be 
acceptable in a carbon constrained future
    Answer. The Vehicle Technologies Program has an open solicitation 
for medium- and heavy-duty engine development and vehicle platform 
integration that includes $5 million of fiscal year 2010 funds, 
leveraged with similar funds from partners California South Coast Air 
Quality Management District and the California Energy Commission (CEC). 
Work funded under the current solicitation will be complementary to 
work already underway funded by CEC. A 50 percent cost-share will be 
required of awardees.
    Furthermore, there remains a small amount of funding under the Fuel 
Processor and Distributed Energy subprograms in Hydrogen and Fuel Cell 
Technologies. The planned funding in fiscal year 2010 is $370,000. The 
fuel processor could be utilized in combined heat and power (CHP) 
systems that are more efficient than legacy combustion technologies.
    Question. I note a better budget request more last year for 
Hydrogen and Fuel Cell R&D however, the request is significantly below 
the 2010 appropriation.
    Why is DOE not funding the Market Transformation program that helps 
bring market ready fuel cell technologies to customers?
    Why does the DOE continue to reduce funding for vehicular fuels 
cells and the supporting infrastructure when we all acknowledge a need 
to investigate multiple alternatives to traditional transportation 
technology?
    Answer. DOE requests $9 million for Market Transformation 
activities in fiscal year 2011. This funding will focus on key Safety, 
Codes and Standards activities, which are essential for market 
transformation. In addition, the Program will assess the impact of $42 
million awarded from the Recovery Act for stimulating market pull, 
increasing manufacturing volume and reducing the cost for fuel cell 
systems.
    The Department's reduction of the Hydrogen and Fuel Cell 
Technologies (HFCT) budget by $37 million allows a balanced portfolio 
of transportation solutions and continued focus on battery and advanced 
vehicle approaches for more near term impact. DOE will also maintain a 
strong effort in key areas of hydrogen and fuel cell research and 
development. DOE requests $50 million for the Sold State Energy 
Conversion Alliance (SECA) Program and expects to maintain funding 
levels at approximately $38 million through the Office of Basic Energy 
Sciences for long-term and crosscutting R&D in hydrogen and fuel cells. 
The SECA Program was initiated to bring together government, industry, 
and the scientific community to promote the development of 
environmentally friendly solid oxide fuel cells (SOFC) for a variety of 
energy needs. SECA is an alliance of industry groups who individually 
plan to commercialize SOFC systems for pre-defined markets; research 
and development institutions involved in solid-state development 
activities; and Government organizations that provide funding and 
management for the program.
    Question. I note the funding request for Residential Buildings 
Integration is less in 2011 than was appropriated in 2010; however, the 
DOE has suggested actually adding to the program by including retrofit 
research and development. How do you plan to accomplish the goal of 
Zero energy homes with this reduction in funding?
    Answer. Prior to fiscal year 2010, the DOE Building Technologies 
Program focused research efforts on new buildings with the idea that 
energy efficiency technologies and research aimed at new buildings 
would also be applicable in existing buildings. While there is some 
overlap between the two markets, particularly in space conditioning, 
hot water, appliances, and lighting, there are also a number of R&D 
needs that are specific to energy retrofits for residential buildings 
that the program will seek to address starting in fiscal year 2010.
    Energy retrofits are considered to be among the most cost effective 
ways for the Nation to reduce its energy use and carbon emissions. 
While zero energy homes remain a goal for the Department, another goal 
is to support the retrofit industry--at a national scope and scale of 
up to two million retrofits per year. This service goal will drive the 
research into immediate near term focus and deliverables, which can 
immediately go into service by contractors and other service 
professionals. The zero energy home goal remains a priority over the 
long term for this program.
    Question. Are there limitations inherent in today's lithium ion 
batteries which require a step change in the weight and power/energy 
density of these batteries to secure longer life as well as provide on 
demand power/acceleration.
    Answer. There are no limitations inherent in today's lithium-ion 
batteries that preclude them from having the ability to provide the 
power/acceleration for hybrid vehicle (HEV) and plug-in hybrid vehicle 
(PHEV) applications while meeting the vehicle size and weight targets 
for the battery. Battery life is typically driven by the capacity fade 
that is influenced by several factors including: (1) chemical 
interactions inside the battery cell that are specific to the 
electrochemistry; (2) battery operation; and (3) cumulative temperature 
profile over the life of the battery. Vehicle manufacturers currently 
install excess battery capacity in order to ensure meeting their 
battery life target. As greater confidence in battery life under real-
world driving conditions develops, the amount of excess capacity 
installed is expected to decrease, which will subsequently reduce the 
overall battery cost.
    For battery-powered electric vehicle applications, improvements in 
battery size and weight are sought in order to provide for a longer 
driving range. However, lithium-ion batteries are still far from any 
theoretical limitations on energy density. Next-generation lithium-ion 
batteries will employ metal alloy anodes (instead of graphite), and 
high-capacity cathodes, resulting in significant increases in energy 
density. Research and development efforts on these technologies are 
well underway and are progressing well.
    Question. Would you agree that one of the issues that has to be 
addressed in developing next generation lithium ion battery technology 
is to reduce or eliminate the irreversible capacity of that same cell?
    Answer. DOE agrees that, for some systems, irreversible capacity 
loss (ICL) is an important issue that must be overcome to enable next-
generation Li-ion cells. The ICL associated with alloy anodes is one of 
several barriers to commercializing that technology. Other issues 
include large volume changes upon cycling (which leads to particle 
fracture), disconnection from the rest of the electrode material 
(resulting in severe energy fade), and unstable alloy surface films 
which consume lithium during cycling (which leads to energy fade). 
However, today's commercial cells suffer 5 to 10 percent ICL, so the 
issue is one of relative size and scale.
    Question. Would the Department be interested in looking at 
technologies, such as stabilized lithium metal powder, to overcome the 
issue I described above?
    Answer. Yes. In fact, the Department of Energy (DOE) is currently 
funding a 3-year, $6.2 million total funding (including a 50 percent 
industry cost share of $3.1 million), research and development contract 
with FMC Lithium to investigate and improve the performance of 
stabilized lithium metal powders. These powders show promise both for 
addressing the irreversible capacity loss, and for enabling the use of 
Li-free cathode materials that exhibit very high capacities, such as 
sulfur or vanadium oxides. This contract was awarded through a 
competitive process.
    In addition, DOE is funding work on novel electrolytes for use in 
alloy anode electrodes that exhibit both lower irreversible capacity 
loss (which enables much higher initial energies) and more stable anode 
surface films (that enable more stable cycling).
    The Department also is preparing a new Funding Opportunity 
Announcement (FOA), expected to be released in the next several months, 
focusing on research into higher energy and lower cost batteries, 
mainly those considered to be ``next generation'' technology. The 
responses to this FOA will be competitively evaluated by subject area 
experts. DOE expects to support the proposals receiving the highest 
technical merit and overall value scores, with out year funding subject 
to annual appropriations.
    Question. Concerns have been raised about the Loan Guarantee 
programs treatment of transmission projects under 1705. The concern is 
that transmission projects, which can be challenging and complex, may 
be put at the bottom of the application pile rather than the top, 
simply because of time pressures. A loan guarantee is a ``major Federal 
action'' that requires DOE to conduct a NEPA review. With less than 18 
months before DOE's authority to issue loan guarantees under section 
1705 expires, I would like to know that DOE is prepared to move to 
conduct and complete the necessary environmental work with all 
deliberate speed, so that transmission projects move forward along with 
renewables. What specific steps has DOE taken to ensure that its NEPA 
review of transmission projects is performed in a timely manner?
    Answer. To ensure that project applications are reviewed in a 
timely manner and NEPA is initiated as soon as possible, the Loan 
Programs Office has added 5 additional Environmental Protection 
Specialists in the past 9 months. All of the new Specialists are senior 
NEPA practitioners with many years of relevant experience. This allows 
DOE to maximize the management and efficiency of the NEPA review 
process.
    The DOE Loan Programs Office assesses the level of NEPA review 
required for all projects when entering into the due diligence process. 
Prior to entering due diligence, a preliminary determination of the 
level of review required is performed using the environmental 
information provided in part I of an application. Discussions with the 
applicants are initiated early in the review process to ensure that 
environmental considerations are fully understood. This allows 
applicants to modify, if appropriate, project proposals to ensure that 
the most expeditious NEPA review process can be performed (e.g., 
performing an Environmental Assessment (EA) rather than requiring and 
Environmental Impact Statement (EIS)).
    If a NEPA review for the project or project site was performed by 
another Federal agency, DOE will adopt that review or incorporate all 
relevant analysis from it into the DOE NEPA document in order to 
expedite the DOE NEPA review process.
    Large transmission projects typically require an EIS. The Council 
on Environmental Quality (CEQ) NEPA implementing regulations must be 
followed in preparing an EIS. Those regulations require DOE to 
undertake a variety of procedural steps during the NEPA review process. 
These include the publication of notices of availability and intent to 
prepare EISs; conduct of public meetings; allowance for public comment 
periods; incorporation of public comments; and consultation with 
States, tribes, and other Federal agencies. The Loan Programs Office 
complies with all of the procedural requirements of NEPA, and has 
established a notice preparation process that significantly reduces the 
length previously found in DOE notices while still being fully 
compliant with the CEQ regulations. The new process reduces the time it 
takes to prepare these notices, and allows the review process to begin 
as expeditiously as possible.
    Question. How is the Department working with transmission 
applicants to ensure the efficiency of the NEPA review process is 
maximized?
    Answer. DOE Loan Programs Office Environmental Compliance Division 
staff talks with transmission project applicants early in the 
application process to ensure that applicants understand the level of 
NEPA review that is required, how the process will proceed, and what 
supporting environmental documentation is necessary to include in the 
application. DOE also assists applicants with an understanding of the 
NEPA process and areas of potential environmental concern through live 
and taped web broadcasts and responses to frequently asked questions 
posted on the Loan Programs Office Web site. DOE continues to update 
program solicitations and the program's Web site to include specific 
guidance that helps to educate potential applicants and expedite the 
NEPA review process.
    Question. What assurances can give you give that meritorious 
transmission projects won't be precluded from selection based on the 
internal timing of DOE's NEPA review?
    Answer. The DOE Loan Programs Office does not base its decision 
regarding project selection on the level of NEPA review required for a 
project. However, DOE generally advises applicants that a project 
requiring an EIS that is not currently being, or has not previously 
been, undertaken by another Federal agency will likely take 18 to 24 
months to complete. In cases where no NEPA work has been initiated, it 
would be difficult for DOE to complete an EIS and have a Record of 
Decision signed in time to begin construction and issue a loan 
guarantee prior to September 30, 2011, the deadline established in 
section 1705 of the Energy Policy Act of 2005, as amended by the 
American Recovery and Investment Act of 2009 for both start of 
construction and issuance of loan guarantees. We also note that, 
actions (e.g., commencing project construction) taken by the applicant 
prior to completing the NEPA review process can put at risk the NEPA 
review and thus the issuance of the loan guarantee. Knowing this, 
applicants can decide whether it is appropriate to pursue a Federal 
loan guarantee. Nevertheless, it is the Loan Programs' goal to work 
with all selected applicants to complete the required NEPA review 
process in as efficient and timely a manner as possible.
    Question. What amount of funding is needed in fiscal year 2011 to 
fully comply with all clean up agreements? Please provide the amounts 
on a site-by-site basis.
    Answer. The Office of Environmental Management's request of $6.047 
billion positions the program to meet its regulatory commitments, 
supports reducing the risk associated with our highest environmental 
risk activities (i.e., tank waste) and achieves footprint reduction 
across the complex. Page 9 of the budget request provides the amounts 
on a site-by-site basis, but the table below displays the funding 
requirements for the major sites.

                        [In thousands of dollars]
------------------------------------------------------------------------
                                                            Fiscal Year
                          Site                                 2011
------------------------------------------------------------------------
Carlsbad................................................         220,245
Idaho...................................................         412,000
Los Alamos..............................................         196,953
Oak Ridge...............................................         432,700
Richland................................................         972,588
River Protection........................................       1,158,178
Savannah River..........................................       1,217,799
------------------------------------------------------------------------

    Question. What amount of funding is needed in fiscal year 2012 to 
fiscal year 2015 to fully comply with all cleanup agreements? Please 
provide the amounts on a site-by-site basis.
    Answer. Compliance with cleanup agreements is a major factor the 
Office of Environmental Management takes into account as it formulates 
its budget requests. Because of the dynamic nature of cleanup 
agreements, including the fact that milestones are renegotiated based 
the results of ongoing characterization and the changing understanding 
of the extent of contamination, we are not able to determine at this 
time the amount of funding needed in fiscal year 2012 to fiscal year 
2015 to be in full compliance with all cleanup agreements.
    Question. What actions are being taken regarding contracts that are 
not meeting all cleanup milestones? Please provide specific examples.
    Answer. Most contracts executed by the Office of Environmental 
Management (EM) are performance based, in which the contractor is 
awarded fee based on the attainment of specific cleanup activities. 
These activities often support a specific compliance milestone. Thus, 
if a cleanup action associated with a milestone is not attained, the 
contractor may not receive as much fee as if it had completed the work 
in accordance with the milestone. In fiscal year 2009, EM met 
approximately 95 percent of its 176 scheduled major enforceable 
milestones so, for the most part, fees were not reduced for missed 
milestones. Nonetheless, the milestone for cold commissioning of the 
Waste Treatment and Immobilization Plant was missed and the contractor 
forfeited significant fee. In addition, where allowable by the contract 
and depending on the nature of the violation, the contractor may be 
responsible for the payment of any fines for violations. For example, 
the New Mexico Environment Department fined the Los Alamos National 
Laboratory for issues associated with chromium in groundwater. The site 
contractor paid the fine.
    Question. Will you make clean up milestones and funding needs to 
meet them publicly available?
    Answer. The Office of Environmental Management (EM) has its 
``Environmental Compliance Performance Scorecard'' posted on its Web 
site (http://www.em.doe.gov/Pages/CompliancePerformance.aspx). This 
scorecard is updated on a quarterly basis and provides the status of 
milestones that were due during the quarter as well as progress on 
those upcoming in the next four quarters. EM bases its funding needs on 
the scope, cost, and schedule of cleanup projects. These projects are 
complex and may have several objectives and milestones associated with 
them such that identifying funding needs for specific milestones is not 
feasible.
    Question. Over recent years, any Federal funding research and 
development activities of the Energy & Environmental Research Center 
(EERC) at the University of North Dakota have always provided a minimum 
20 percent cost share as defined under the Energy Policy Act of 2005. 
In fiscal year 2010, Congress directed that continued funding be 
provided to the EERC for additional research and development activities 
as well as funding for a new building to house research and development 
activities critical to meeting the future energy needs of the United 
States. However, the building, which will only support research and 
development projects, has been labeled as a demonstration activity and 
subject to a 50 percent minimum cost share. Is this typical, and is it 
appropriate, to place such a large minimum cost share on a building for 
which the activities occurring within will be research and development, 
which only requires a minimum 20 percent cost share?
    Answer. The cost share determination has been revised to require 
only 20 percent minimum cost share for the effort to construct the 
building. The DOE Contracting Officer notified Ms. Sheryl Landis and 
Principal Investigator at UND of this change in writing on April 1, 
2010.
    Question. The Energy Independence Security Act of 2007 set a 36 
billion gallon mandate for biofuels by 2022. The DOE loan guarantee 
program can be instrumental in seeing that this goal is reached. 
However, DOE has yet to issue a single loan for the advanced biofuel 
industry. The loan program has told the industry they need to bring 
off-take agreements to get these loans, yet the fuels market does not 
operate in this manner. What can DOE do to facilitate issuing loan 
guarantees for advanced biofuel projects in the coming year?
    Answer. While third-party supply and/or off-take agreements are not 
mandatory to satisfy the statutory requirement that the project have a 
reasonable prospect of repayment of the principle and interest of the 
guaranteed loan, they are factors which are taken into consideration. 
For projects that are not supported by third-party supply and/or off-
take agreements, the projects need to establish that a viable market 
exists for the product produced by the projects. The Loan Guarantee 
Program is working closely with the Renewable Fuels Association to 
facilitate dialogue with the biofuels companies. As a result of this 
collaboration, on April 7, 2010, The Loan Guarantee Program held a 
roundtable discussion with members of the biomass community to discuss 
issues that the industry faces in obtaining loan guarantees.
    Question. The fiscal year 2011 budget for EERE indicates that DOE 
intends to launch a new biopower initiative. Why is DOE undertaking 
this new effort now, and what does this mean for biofuels producers who 
might be looking for a new round of funding for advanced biorefinery 
facilities?
    Answer. The Large Scale Biopower Initiative will accelerate the 
development of advanced technologies to enable utilizing sustainably 
harvested biomass for electric power generation. Biomass used for 
biopower may offer a renewable base load energy option that could be 
available year round. These advanced biopower technologies may have 
positive environmental impacts for the existing utility industry and 
also benefit local communities providing the biomass feedstock. There 
are also opportunities to retrofit equipment that is currently idle, 
such as boilers found in pulp and paper plants, in older and smaller 
coal-fired power plants, or co-fired in conjunction with coal and use 
it in the biopower production process. Additionally, biopower is an 
option for meeting State-level Renewable Portfolio Standards (RPS). The 
Biopower Initiative aims to accelerate the deployment of biopower 
technologies to enable biopower deployment as soon as 2013 in support 
of potential future RPSs.
    Furthermore, a component of the proposed advanced technologies for 
the introduction of biopower is the development of densified biomass-
derived intermediaries--such as torrefied biomass and bio-oil--which 
are technologies that can be leveraged in the production of biofuels.
    The fiscal year 2010 appropriation and fiscal year 2011 request do 
not include funding for another integrated biorefinery solicitation. 
The integrated biorefinery funds requested incrementally fund projects 
previously selected in fiscal year 2007 and fiscal year 2008. 
Furthermore, the number of integrated biorefinery facilities was 
significantly expanded by Recovery Act funding.
    Question. The NNSA budget request includes a 5 year spending plan 
for each element of the budget request. A 5 year spending plan shows 
the fluctuation of spending year to year, when certain programs and 
projects reach peaks or are finished, and provides a sense that the 
requested fiscal year 2011 budget is grounded in some longer term plan. 
Outside of NNSA, the rest of DOE does not provide 5 year spending 
plans. Mr. Secretary, can you provide 5 year spending plans for all DOE 
programs and projects as NNSA does now?
    Answer. I believe that considering 5 year budget implications 
provides useful guidance for internal formulation and planning and the 
Department is making significant strides in that direction.
    A more in-depth internal consideration of multi-year budget 
implications will offer the Department many advantages including 
enhancing transparency and improving long-term planning. We are 
currently establishing a Department-wide budget formulation and 
execution system that will be better able to build and track 5 year 
budget plans.
    Question. You did not request new funding for the Clean Coal Power 
Initiative this year, Also, the Obama administration announced a multi-
agency CCS Task Force with the Office of Fossil Energy and EPA as the 
co-leads on February 3, 2010. The goal of that effort is to work to 
overcome the barriers for widespread deployment of CCS within 10 years 
and to bring 5-10 commercial scale projects on line by 2016. Can you 
tell me what you hope to achieve with CCPI Round III (from the Recovery 
Act) projects?
    Answer. The third round of Clean Coal Power Initiative (CCPI) 
demonstration projects is well underway and is focused on developing 
projects that utilize carbon capture and storage technologies and/or 
beneficial reuse of carbon dioxide. Five projects have been selected, 
two focusing on pre-combustion carbon capture in greenfield integrated 
gasification combined cycle (IGCC) plants and three post-combustion 
capture projects using slipstreams at existing pulverized coal (PC) 
power plants. Thus far, the Department has signed cooperative 
agreements on three of these projects (two IGCC and one PC). Each of 
these projects will be demonstrating a different carbon capture 
technology to provide the market a diversity of CO2 capture 
approaches. These projects will be storing CO2 in either 
saline aquifers or using it for enhanced oil recovery and will conduct 
extensive monitoring, verification, and accounting to ensure permanence 
of storage. Four of the five projects selected will be capturing and 
storing CO2 in excess of 1 million tons per year.
    Question. When do you plan to announce, how much would you hope to 
fund, and what would be the focus of a CCPI Round IV?
    Answer. Commercial-scale demonstration of carbon capture and 
storage (CCS) technologies is a key step to generate data and expand 
our knowledge of how these systems work when integrated with an 
operating power plant. The Department is focused on successfully 
implementing the five selected CCPI Round III demonstration projects, 
as well as other CCS demonstrations currently managed by the Department 
(a CCPI Round II project, FutureGen, and the multiple Industrial CCS 
demonstration projects). These demonstrations are critical for proving 
integrated operation and safe and effective long-term storage at scale. 
The R&D focus is on developing advanced technologies to improve cost 
competitiveness of CCS technologies. These demonstration projects will 
provide important information to help guide future budgetary decisions.
    Question. How will each of these CCPI projects feed into the CCS 
task force goals?
    Answer. One of the chief goals of the Carbon Capture and Storage 
(CCS) Task Force is to develop a proposed plan to overcome the barriers 
to the widespread, cost-effective deployment of CCS within 10 years, 
with a goal of bringing 5 to 10 commercial demonstration projects 
online by 2016. All five Clean Coal Power Initiative projects selected 
in the third round and one selected in the second round are presently 
scheduled to begin plant operation and CO2 sequestration 
during or before 2016.
    Question. For the last 3 years, the Energy and Water Subcommittee 
has provided funds to begin exploring expansion of a 5th SPR site in 
Richton, MS. This site plus expansions at two other existing sites were 
intended to expand the SPR to the 1 billion barrel level. This was the 
policy pushed by Vice-President Cheney. It is my understanding that a 
June 2007 DOE study found that it would cost in the range of $21 
billion to build and fill that expansion effort.
    What is the Obama administration's policy on the SPR and the costs 
and need for site expansion? Are there better ways to achieve energy 
security? Why are you proposing to us $71 million of prior year 
balances for operations and management for fiscal year 2011?
    Answer. The administration is currently reviewing Strategic 
Petroleum Reserve 1 billion barrel expansion policy. While this is 
occuring, the fiscal year 2011 budget proposes the cancellation of $71 
million in balances from prior years appropriated for expansion 
activities at the proposed Richton, Mississippi site and use of these 
balances to partially fund the SPR's requirements in fiscal year 2011. 
The SPR requires $209,861,000 for the management and operations in 
fiscal year 2011.
    Question. The administration has not requested R&D funds for the 
oil and gas programs. Both the Bush and Obama administrations have done 
that in their budget requests. At the same time, in the fiscal year 
2010 conference report, Congress required the DOE to come up with a 
research development and demonstration strategy and provide a report 
that outlines these activities. The E&W conference report provided $20 
million for that effort and requested a report. Despite not requesting 
funds, will you commit to completing that strategic plan with a multi-
year technological horizon and also engage the private sector and 
academic interests?
    Answer. As directed in the appropriation bill, a research and 
development strategy for unconventional oil, gas, and coal resources is 
being developed. The draft strategy will include the resource 
opportunities and technology applications and we will seek input from 
academia and the private sector. The provided funds will be used for 
unconventional oil, gas, and coal resources projects identified in the 
strategy. A funding opportunity announcement seeking proposals for new 
projects will be issued soon.
    Question. The ITER project faces significant delays. The 
construction completion date has slipped from 2016 to 2022 and the 
total project cost estimate has increased from $14 billion to $20 
billion. The ITER International Office managing this project still does 
not have a final design or a schedule and cost baseline. These delays 
have increased U.S. costs and further delays could put at risk the 
U.S.'s total project cost estimate of $2.2 billion for construction. 
What has the United States done to mitigate risk?
    Answer. The Department's senior leadership has been vigorously 
engaged in the ITER project over the past 8-9 months. We are currently 
working with the other ITER members to achieve a final, credible 
project baseline and a change in ITER Organization management that will 
ensure robust management during the construction phase. We are making 
progress with the other members to address these issues. We hope to 
have some of them resolved by the June 2010 ITER Council Meeting (IC-
6). We anticipate using the fiscal year 2011 funding request to make 
substantial progress on the design, R&D, and long-lead procurement 
activities for the U.S. hardware contribution, as well as to keep the 
United States on track to meet its critical path commitments to the 
project.
    Question. Will the United States consider withdrawing from ITER if 
delays continue and costs escalate beyond the $2.2 billion U.S. 
commitment?
    Answer. DOE's policy is to aggressively manage projects to maintain 
cost and schedule. DOE constantly assesses projects to improve 
performance as prescribed by DOE Order 413.3A. ITER is no exception. We 
have made progress in addressing ITER performance concerns. We hope to 
determine the project baseline schedule and improve the management 
issues shortly to allow for much more orderly and efficient management 
of the ITER project. The Department is committed to maintaining the 
established CD-1 cost range for the U.S. contribution to the project 
and, in fact, has resisted entreaties by the ITER Organization to 
accept more scope.
    Question. When will a decision be made by the United States on 
whether to stay in the ITER program?
    Answer. We hope to establish the overall ITER project baseline and 
improve the management issues by the June 2010 ITER Council Meeting 
(IC-6). DOE constantly assesses projects to improve performance as 
prescribed by DOE Order 413.3A.
    Question. I think we all agree we need to move to an electric drive 
transportation system to decrease our dependence on foreign oil and 
decrease our greenhouse gas emissions. I know that your Department is 
working toward decreasing battery costs, which are a huge part of the 
increased incremental cost of electric vehicles. Further, President 
Obama has set a goal of having 1 million electric vehicles on the road 
by 2015.
    What are the major things that the Department is doing to achieve 
that goal? What percentage of the Advanced Vehicles Technology budget 
is going into electric drive vehicles (which can include both battery 
and fuel cell vehicles)?
    Answer. Using Recovery Act funds, the Department is making 
substantial investments in establishing domestic manufacturing 
capability and infrastructure development needed to advance the 
widespread market penetration of electric drive vehicles. These 
investments totaled over $2.4 billion, including up to $2 billion for 
battery and electric drive manufacturing facilities, $400 million for 
transportation electrification projects, and $20 million in battery 
research and testing facilities.
    Under the Advanced Technology Vehicle Manufacturing Loan Program, 
the Department made loan commitments of over $8 billion to domestic 
manufacturers of advanced technology vehicles, including loans to Ford, 
Nissan, Tesla, and Fisker Automotive. A substantial fraction of the 
funds disbursed will support domestic manufacturing facilities focused 
on producing batteries, plug-in hybrid, and electric vehicles.
    Under the Recovery Act's section 48C Advanced Energy Manufacturing 
Tax Credits, the Department made awards for tax credits for several 
clean energy manufacturing projects related to electric drive vehicles.
    In addition, the Department is conducting ongoing applied R&D to 
support the development of critical technologies needed for widespread 
introduction of electric drive vehicles. These efforts include battery 
development, power electronics and electric motors, and electric drive 
vehicle systems.
    As part of the U.S. Government effort to update the Federal fleet 
with fuel efficient hybrids and plug-in hybrid electric vehicles, DOE 
will replace 753 vehicles with hybrids in 2010. This will bring the 
total number of DOE hybrid vehicles to 888, even as the agency trims 
the overall size of its vehicle fleet.
    In fiscal year 2010, the DOE Vehicle Technologies Program is 
investing $145 million directly supporting electric drive technologies, 
or approximately 47 percent of its total fiscal year 2010 
appropriation. Other R&D, such as vehicle lightweighting, indirectly 
supports vehicle electrification.
    Question. What is the Department planning to do to overcome the 
non-technical barriers to the deployment of electric vehicles? Are you 
dedicating some of your resources to a public information campaign?
    Answer. Significant resources are being dedicated to addressing 
non-technical barriers. The Department is closely collaborating with 
the EPA to develop and validate fuel economy test protocols for 
electric drive vehicles. The Department works with the Society of 
Automotive Engineers (SAE) and various industry standards organizations 
to establish codes and standards to promote faster widespread market 
penetration. The Department is working with the National Highway 
Traffic Safety Administration and the National Fire Protection 
Association to develop safety standards. The Department has made 
significant awards to develop educational programs for teachers, 
student, and the general public.
    Resources are being dedicated to a public information campaign, 
including the work of the Department's Clean Cities program, which is 
conducting public deployment programs and communicating the benefits of 
transportation electrification to the general public. The Clean Cities 
public education and outreach activities provide technical assistance 
and consumer information related to electric vehicles and other 
alternative fuels, as well as the infrastructure and service industries 
needed to support them. In fiscal year 2010, approximately $10.3 
million is devoted to these efforts.
    As part of the Recovery Act projects, the Department made 
competitively selected awards, totaling $39 million, to 10 consortia of 
universities, community colleges, science centers, and public relations 
organizations to develop advanced electric drive vehicle educational 
programs for student, teachers, technicians, emergency responders, and 
the general public.
    In addition, the Department has launched an outreach effort on its 
Energy Efficiency and Renewable Energy Web site entitled Energy 
Empowers, which includes informative articles and videos showing where 
the Department's efforts are making an impact on people's lives.
    Question. How do you expect to leverage what is learned from the 
demonstration Communities funded by the Recovery Act funds for future 
widespread deployment of electric vehicles?
    Answer. The information obtained and lessons learned as a result of 
the Demonstration Communities will help to guide future development and 
deployment efforts. It will also help to instill a greater 
understanding among the general public of the costs and benefits of 
electric vehicles. Based on this greater public knowledge and 
confidence, the Department will be able to leverage greater future 
investment by local communities in establishing electric vehicle 
infrastructure.
    Question. The electrification (even partial) of medium and heavy 
duty vehicles could play a significant role in decreasing oil use and 
greenhouse gas emissions, due to their low fuel economy. Can you 
describe to me what work the Department is doing in this area and how 
that is represented in your budget?
    Answer. Current electric drive technologies that are being 
developed for automotive applications (e.g., batteries, electric motors 
and power electronics) are in general also applicable to both medium- 
and heavy-duty vehicles. More specifically, R&D on advanced 
technologies for electrification of medium- and heavy-duty vehicles is 
ongoing under the 21st Century Truck Program, and under the SuperTruck 
Program recently initiated with Recovery Act funds. SuperTruck also has 
additional funding support from annual appropriations.
    Truck-stop electrification is being implemented using Recovery Act 
funds. Cascade Sierra Solutions was competitively-selected for an award 
of up to $22.2 million to deploy truck stop electrification 
infrastructure at 50 sites along major U.S. interstate highways and to 
provide 5,450 rebates for truck modification to implement idle 
reduction technologies.
    Medium- and heavy-duty electric drive vehicle awards, 
competitively-selected using Recovery Act funds, include an award of up 
to $45 million to a consortium of California's South Coast Air Quality 
Management District (SCAQMD) and 50 different utilities and fleets to 
develop a fully integrated, production plug-in hybrid system for Class 
2-5 vehicles (8,500-19,500 lbs gross vehicle weight) and demonstrate a 
fleet of 378 trucks and shuttle buses; Navistar was awarded up to $39 
million to develop and deploy 400 advanced battery electric delivery 
trucks (12,100 lbs gross vehicle weight) with a 100-mile range; and 
Smith Electric Vehicles was awarded up to $32 million to develop and 
deploy up to 100 electric vehicles, such as ``Newton'' medium-duty 
trucks.
    Question. What are you currently doing to investigate the possible 
uses of automotive grade lithium ion batteries in stationary 
applications, both with new and somewhat depleted batteries?
    Answer. Several electric drive vehicle battery manufacturers are 
assembling battery packs for stationary grid applications using 
automotive grade lithium ion battery cells developed with DOE funding 
support. For example, A123Systems has built large battery systems from 
high power HEV batteries to support grid frequency regulation. DOE 
anticipates that some of battery production facilities being 
established with support from the Recovery Act will produce batteries 
for both vehicle and utility grid applications.
    In addition, the DOE Office of Electricity Delivery and Energy 
Reliability, with the help of Sandia National Laboratory, is studying 
the value propositions of various energy storage systems, including 
``new'' automotive grade lithium-ion batteries, for stationary grid 
applications such as load leveling, peak demand management, all of 
which could help defer the need to build peaking power plants.
    For ``somewhat depleted'' batteries used in automotive 
applications, the Vehicle Technologies Program (VTP) initiated a 
program to investigate the merits of re-purposing or re-using the 
batteries retired from plug in hybrid electric vehicles (PHEV) or 
electric vehicles (EV) for other applications. This program has several 
elements including analysis, testing, and demonstration. In the 
analysis portion, VTP is investigating the value of the ``somewhat 
depleted'' batteries for grid, off-grid and other mobile applications. 
The potential uses in grid applications include home energy storage 
appliance, community energy storage, substation back up, and 
electricity storage for wind or solar plants.
    Question. How do you anticipate the battery and storage hub 
integrating with existing programs in OE and EERE as well as ARPA-E?
    Answer. The Department formed an Energy Storage Working Group to 
enhance communication and coordination of energy storage research 
across the Department. This activity is led by the Under Secretaries as 
well as the principals of the Offices of Science (SC), Energy 
Efficiency and Renewable Energy (EERE), Electricity Delivery and Energy 
Reliability (OE), and ARPA-E. The Energy Storage Working Group has 
initiated an extensive assessment of the DOE-wide energy storage 
investment by technology readiness level. A staff level group meets 
more frequently to coordinate day-to-day activities. The involved 
program offices share detailed project listings and participate in 
review of each other's new and ongoing projects. They also share 
information on upcoming Funding Opportunity Announcements and support 
joint workshops to identify gaps and barriers.
    In addition, there is a parallel Hubs Working Group that 
coordinates the formulation of the Hubs to ensure similar processes and 
coordination among the Hubs. The Department's Energy Innovation Hubs 
Oversight Board (Under Secretaries for Energy and Science, their senior 
scientific/technical advisors, and I) will provide additional assurance 
that these activities are effectively managed and coordinated. Hub 
researchers will also be full participants in joint program meetings 
with researchers and managers from SC, OE, EERE, and ARPA-E to ensure 
seamless information exchange and to promote coordination and 
collaboration as appropriate.
    Question. In your budget this year, you have cut hydrogen and fuel 
cell funding by $37 million from last year's appropriated level. 
Although this is an improvement over the budget you constructed last 
year, I'm still concerned that this decrease could be seen as an 
indication of what you plan to do with this program. The major programs 
that seem to have been decreased are both Hydrogen and Fuel Cell R&D 
lines ($17 million) and the Market Transformation ($15 million).
    Can you give a brief summary of the existing programs that will be 
discontinued or significantly scaled back in order to make these cuts 
possible?
    Answer. Project deferrals will occur in the Market Transformation 
subprogram, which includes Early Markets, Safety, Codes and Standards, 
and Education, and in the Systems Analysis subprogram.
    Question. One question I have is why would you so dramatically 
decrease the funding for the work that is designed to encourage public 
adoption of the technology, which the American people have funded over 
the years?
    Answer. The Hydrogen and Fuel Cell Technologies funding request 
provides for a focused effort on key Safety, Codes and Standards 
activities, which are essential for market adoption of hydrogen and 
fuel cell technologies. At the same time, data collection and analysis 
of fuel cell systems will continue on fuel cells that are placed into 
the market using fiscal year 2009, fiscal year 2010 and Recovery Act 
funding that together totals nearly $62 million. Analysis of these data 
will be conducted to help identify future needs.
    Question. Last year, the cuts you proposed in this area would have 
abruptly terminated funding to 189 ongoing multi-year grants. Will any 
existing grants be affected this year.
    Answer. There will be 22 projects deferred in fiscal year 2011 in 
Market Transformation (18) and in Systems Analysis (4). Deferred means 
that an existing project will not be funded in fiscal year 2011, but 
the funding of that project could be re-started in fiscal year 2012 
depending upon appropriations. An existing project is one that began in 
fiscal year 2010 or earlier. We retain the option to continue funding 
the project in out years. Deferred does not include new projects that 
would begin in fiscal year 2011. However, the Program anticipates about 
20 new projects will begin in Fuel Cell Systems R&D.
    Question. What are your plans for further solicitations in this 
area to continue building upon the work that the Department has done 
for many years?
    Answer. The Department plans for solicitations in the Fuel Cell 
Systems R&D and Manufacturing R&D subprograms. For the fuel cell 
solicitation, a Request for Information has closed, a pre-solicitation 
workshop has been conducted and preparation of the Funding Opportunity 
Announcement is underway. DOE anticipates that this solicitation will 
yield about 20 new projects.
                                 ______
                                 
             Questions Submitted by Senator Robert C. Byrd
    Question. In reviewing the fiscal year 2011 Fossil Energy Research 
and Development (R&D) budget, I am very troubled. Despite a healthy 
overall 6.8 percent increase for the Department from the fiscal year 
2010 enacted level, the Fossil Energy R&D program is not among the 
beneficiaries of forward-thinking. It greatly concerns me that the Coal 
R&D budget is flat funded; the Oil and Natural Gas R&D programs are 
zeroed out; no new funds have been requested for a Clean Coal Power 
Initiative (CCPI) Round 4 solicitation; the Fossil Energy Program 
Direction account is underfunded by $10 million and underfunded by $19 
million if funding is not provided to administer the Recovery Act 
activities; the Methane Hydrates work that has been traditionally 
conducted by NETL is being transferred to the Office of Science; and 
the Ultra-Deepwater and Unconventional Gas and Other Petroleum Research 
Fund has been offered up for rescission.
    Is the fiscal year 2011 Fossil Energy R&D budget an accurate 
reflection of your vision for NETL and the Fossil Energy R&D program? 
Please elaborate.
    Answer. The Office of Fossil Energy's (FE) primary objective is to 
ensure the continued use of traditional fuel sources to provide clean, 
affordable, reliable energy. The Clean Coal Research Program, 
implemented by the National Energy Technology Laboratory (NETL), 
supports the U.S. Department of Energy's (DOE) overall mission to 
achieve national energy security in an economic and environmentally 
sound manner. The Fossil Energy Research and Development fiscal year 
2011 budget request of $586.5 million represents more than 75 percent 
of FE's total fiscal year 2011 budget request and will help maintain 
DOE's leadership role in addressing the challenge of climate change, 
deliver to the Nation superior electricity generating technologies, and 
allow NETL to carry out energy and environmental research, development, 
and demonstration programs.
    The Coal Program has four key priorities: (1) to develop carbon 
dioxide (CO2) capture technologies for fossil fueled power 
plants and industrial sources; (2) to establish safe, reliable 
CO2 storage methods including geologic storage and 
beneficial reuse; (3) to improve the efficiency of both existing and 
new coal-fired power generation plants; and (4) to implement computer 
modeling and simulation to accelerate the Research and Development 
(R&D) path from discovery to commercialization and reduce costs.
    There are a number of technical and economic challenges that must 
be overcome before cost-effective CCS solutions can be implemented to 
address climate change. Funding from the American Recovery and 
Reinvestment Act (Recovery Act) is helping to address these challenges. 
The Recovery Act provided an additional $3.4 billion for FE R&D to 
accelerate the commercial deployment of CCS technology, including $800 
million for the Clean Coal Power Initiative. The Recovery Act funding 
coupled with our annual appropriations will allow FE and NETL to 
support important advances in capture technologies, efficiency of 
advanced power generation systems and CO2 storage 
technology. The experience gained from capture and storage 
demonstrations funded by the Recovery Act will be a critical step 
forward achieving widespread, cost-effective deployment of CCS. In 
addition to the Recovery Act projects, the core research, development, 
and demonstration activities that leverage public and private 
partnerships will support the goal of broad cost-effective CCS 
deployment in the post-2020 timeframe.
    Consistent with administration policy to phase out fossil fuel 
subsidies, the Office of Fossil Energy requested no funding for oil and 
gas research and development. In addition, Methane Hydrates R&D is 
transferred to the Office of Science. Over the next 2 years, the 
program will phase out production related R&D activities in favor of 
research to strengthen the fundamental understanding of methane 
hydrates: their formation and occurrence; their role in geological and 
ecological systems; their stability in natural and engineered systems; 
and their role in the carbon cycle. This transfer does not preclude 
academic institutions and laboratories from applying for grants to 
support research that addresses these more fundamental questions. This 
decision is based on the nature of the research and development 
activities not the type of competitively selected awardees.
    Question. The Coal R&D program, which has been flat funded, is 
focused on developing a portfolio of technology options for future 
energy plants that will provide significant improvements in efficiency 
coupled with Carbon Capture and Storage. Given that the Environmental 
Protection Agency will begin regulating greenhouse gas emissions next 
year, how do you view the Coal R&D budget as adequate?
    Answer. The Fossil Energy Research and Development fiscal year 2011 
budget request of $586.5 million represents more than 75 percent of 
FE's total fiscal year 2011 budget request and will help maintain DOE's 
leadership role in addressing the challenge of climate change, deliver 
to the Nation superior electricity generative technologies, and allow 
NETL to carry out new and ongoing energy and environmental research, 
development, and demonstration programs.
    In addition, the Recovery Act provided $3.4 billion for Fossil 
Energy Research, Development, and Demonstration FER&D to accelerate the 
commercial deployment of CCS technology.
    The coal research and development (R&D) funding request in the 
President's fiscal year 2011 budget is sufficient to meet current 
needs. Ultimately comprehensive energy and climate legislation that 
puts a cap on carbon will provide the largest incentive for CCS because 
it will create stable, long-term, market-based incentives to channel 
private investment in low-carbon technologies.
    Question. The Oil and Natural Gas R&D programs focus on long-term, 
high risk research and development, and are implemented by 
universities, national laboratories, research and development 
institutions, governments, and industry. These programs involve 
research and development on unconventional resources, such as methane 
hydrates; natural gas locked in tight sands, coals, and shales; 
stranded oil; and crude oil in non-conventional reservoirs. I am 
advised that these resources are significant--billions to trillions of 
barrels and more than 1,000 trillion cubic feet of natural gas; 
however, technology advancements are required to develop these domestic 
resources. Furthermore, it is my understanding that the vast majority 
of the oil wells belong to independent operators eager to apply the 
technologies that the Department is helping them access. Why is the 
Department turning its back on these huge potential resources by 
zeroing out the Oil and Natural Gas R&D programs? What alternatives 
have you considered to improve the programs, rather than to eliminate 
them?
    Answer. The Methane Hydrates R&D program is proposed to be 
transferred to the Office of Science. Over the next 2 years, the 
program will focus on research to strengthen the fundamental 
understanding of methane hydrates: their formation and occurrence; 
their role in geological and ecological systems; their stability in 
natural and engineered systems; and their role in the carbon cycle. 
This transfer does not preclude academic institutions and laboratories 
from applying for grants to support research that addresses these more 
fundamental questions. This decision is based on the nature of the 
research and development activities not the type of competitively 
selected awardees.
    Question. During our January 2009 visit in my office, I urged you 
to visit the NETL in Morgantown. Have you made such a visit to any of 
the NETL campuses? What steps have you taken to schedule this visit?
    Answer. Despite several attempts, I have not been able to visit the 
NETL in Morgantown. I look forward to the chance to see the NETL 
campuses and I am working with my staff to schedule a visit soon.
    Question. I have been supportive of the concept behind FutureGen, 
and public-private partnership to build a first of its kind, coal-
fueled, near-zero emissions power plant, provided that the Federal 
share of the project was not funded at the expense of the basic Coal 
R&D account. I understand that you intend to make a go/no go decision 
on the FutureGen project in the coming weeks.
    If you determine that the FutureGen project should proceed, what 
additional Federal resources will be required to complete the project? 
How would the administration make up that shortfall? What assurance can 
you provide me that this shortfall will not be addressed by robbing the 
Coal R&D account?
    Answer. The FutureGen Alliance submitted its Renewal Application to 
DOE on March 19, 2010.
    The latest estimate of capital costs from the FutureGen Industrial 
Alliance has grown from the earlier one provided.
    Currently, the Department is in discussions with the FutureGen 
Alliance about the most promising funding path forward. If additional 
funds are warranted, the Department may consider the use of prior year 
available funds but does not plan to fund the project through offsets 
from current year research and development (R&D) funding nor from 
future year requests for appropriated R&D funds.
    Question. If FutureGen is a ``go,'' will the Department be able to 
obligate funds provided through the American Recovery and Reinvestment 
Act (ARRA) prior to the September 30, 2010, deadline? If those funds 
expire, how will the Department address the FutureGen funding needs?
    Answer. The Department is planning to obligate the American 
Recovery and Reinvestment Act funds for the FutureGen project before 
the September 30, 2010, deadline.
    Question. Should a determination be made not to proceed with the 
FutureGen project, how will the Federal funds that have thus far been 
made available for the project be redirected?
    Answer. On March 19, 2010, the FutureGen Industrial Alliance 
submitted its Renewal Application to the Department of Energy. 
Currently, DOE is in discussions with the FutureGen Alliance about the 
most promising path forward toward a successful project.
    Question. What goals of the FutureGen project being met through the 
current CCPI Round 3 and other funding opportunities provided through 
the ARRA?
    Answer. Some of the environmental goals of FutureGen (emissions of 
criteria pollutants and mercury) will likely be met under the Clean 
Coal Power Initiative Round 3 and American Recovery and Reinvestment 
Act funded awards. The carbon capture and storage goals of FutureGen 
are more stringent than those required under the alternative funding 
opportunities; however, some of the projects being pursued under the 
CCPI would satisfy the 90 percent carbon capture goal and the 
sequestration goal of a minimum 1 million metric tons per year. The 
goal of fully integrating an integrated gasification combined cycle 
powerplant with sequestration in a saline formation remains unique to 
FutureGen.
    Question. After spending most of our meeting last year discussing 
the importance I place on NETL, I was disturbed that your office did 
not take the time to notify me that NETL Director Carl Bauer had 
retired earlier this year. As the Department considers candidates, I 
urge you to seriously consider filling this position with someone who 
not only has a strong technical background, but also who knows how NETL 
is structured, how it works within the Department, and how to build 
relationships with outside stakeholders. What is the status of the 
Department's efforts to identify a new NETL director? I expect your 
office to notify me as soon as a formal decision has been made. I would 
very much like the opportunity to meet the new Director, and will rely 
on your office to help coordinate such a visit.
    Answer. Your office was notified on April 1, 2010, that the 
Department named Anthony V. Cugini as the new NETL Director. Dr. Cugini 
has a strong technical background that includes expertise in a number 
of key energy and environmental research and development areas, 
including catalyst development, advanced carbon synthesis, hydrogen 
production and separation, gas hydrates, and CO2 
sequestration and computational modeling.
    During Dr. Cugini's 23-year career at NETL he was responsible for 
overseeing the Office of Research and Development since 2007, where he 
supervised an organization with over 400 personnel at 3 NETL locations, 
which included cutting-edge research and computer simulations conducted 
onsite as well as that performed through partnerships, cooperative 
research and development agreements, financial assistance, and 
contractual arrangements with universities and the private sector.
    Dr. Cugini's background provides an excellent combination of 
leadership abilities, scientific and research expertise, understanding 
of key technical challenges in clean energy, and familiarity with 
NETL's programs, personnel, and capabilities. Dr. Cugini's outstanding 
career at the laboratory has demonstrated a clear ability to continue 
NETL's important mission at a high level of achievement and 
accomplishment. The Department looks forward to the lab's continued 
progress and success under his leadership.
    As requested, we will be pleased to arrange a visit with you and 
Dr. Cugini. The Department's Office of Congressional and 
Intergovernmental Affairs will contact your office to coordinate a 
visit.
    Question. NETL also serves as a PMC for EERE. Approximately 122 
NETL employees support the PMC by implementing 40 percent of EERE's 
projects and programs, including weatherization, power and vehicles, 
and buildings and industrial technologies.
    The EERE program direction for the PMC at NETL did not allow for 
annual cost escalation and is $3 million below what is required to 
sustain the 122 NETL FTEs supporting the PMC at NETL. If this funding 
shortfall is not addressed by Congress, how many NETL positions will be 
eliminated?
    Please provide me with an update on the PMC activities at NETL, 
specifically, the long-term plans to continue this successful NETL-EERE 
collaboration.
    Answer. In fiscal year 2010, the initial NETL Program Direction 
budget was $14.2 million (same as fiscal year 2009), with the 
understanding that after we completed our midyear budget review an 
adjustment may be made based on need. NETL was notified that its final 
fiscal year 2010 regular program direction budget would increase by 
$1.3 million to $15.5 million (9.2 percent) above fiscal year 2009. In 
addition, EERE increased the NETL Recovery Act Program Direction budget 
by $3.5 million. Therefore, there is no funding shortfall in fiscal 
year 2010, and no positions will be eliminated in fiscal year 2010. 
Upon receiving the fiscal year 2011 appropriation from Congress, EERE 
will reassess the funding requirements at the PMC locations, and ensure 
equitable distribution.
    NETL has been a successful partner with EERE, and the long-term 
plan is to continue this working relationship.
    Question. As American industries confront the challenges of 
reducing their carbon emissions and creating the clean energy jobs of 
the 21st century, how can the Industrial Technologies Program (ITP) 
help to place on a fast track major innovations in efficiency and cost-
effective environmental performance? Certain components of this program 
were scaled down or terminated in recent years. Through the ITP, or 
perhaps through other programs, how do you intend to increase the 
Department's focus on maximizing the research, development, and 
deployment that can be achieved through public-private cost-share 
programs, with a view toward achieving bold advancements in the energy-
intensive industries that are so vital to the future of America's clean 
energy job market?
    Answer. The Nation faces serious economic, energy, and 
environmental challenges that are impacting all sectors of the economy, 
including manufacturing which has seen significant job losses over the 
past 2 years. Clean energy development and deployment, and a robust 
manufacturing infrastructure which supports this endeavor are critical 
to U.S. energy security, jobs, and reducing carbon emissions, and have 
been a priority of the administration. In January, President Obama 
announced the award of $2.3 billion in Recovery Act Advanced Energy 
Manufacturing Tax Credits for clean energy manufacturing projects 
across the United States. Additionally, in November 2009, Secretary Chu 
announced more than $155 million in Recovery Act funds for 41 
industrial energy efficiency projects across the country. ITP also 
funded additional Industrial Technical Assistance activities to assist 
energy-intensive manufacturers cut their energy bills, improve their 
productivity, and save jobs over the past few years.
    Also during the summer of 2009, to help restock the technology 
development pipeline, ITP issued a funding opportunity announcement 
(FOA) for grand challenge concept studies to define requirements for 
transformational industrial processes and technologies that reduce the 
energy intensity or greenhouse gas emissions by a minimum of 25 percent 
while providing a return on investment of 10 percent or greater. 
Selections from this FOA are expected to be completed by May 2010.
    Notwithstanding these efforts, ITP recognizes the significant long-
term need for process innovation in manufacturing. The fiscal year 2011 
budget re-prioritized the ITP program strategy. This new strategy 
emphasizes crosscutting technologies that provide significant savings 
across multiple energy intensive industries. ITP will continue to 
support industry-specific R&D for the energy-intensive chemical 
industry. The Program is developing breakthrough technologies that 
significantly reduce process energy- and carbon-intensity, and plans to 
undertake an exploratory study to identify pathways for significant 
carbon emission reductions from the cement industry. ITP will continue 
to work with other energy-intensive industries through its Energy 
Intensive Process R&D activities, which focus on developing innovative 
crosscutting technologies applicable to multiple industries.
    In addition, the fiscal year 2011 ITP budget request proposes a new 
subprogram entitled Manufacturing Energy Systems (MES). The MES 
program, to be anchored at two U.S. universities, will serve as 
knowledge development and dissemination centers organized around 
distinct manufacturing areas with critical technical needs. The centers 
will reduce the time necessary to translate innovation into commercial 
product for low or near-zero carbon processes and technologies.
    ITP will continue to coordinate with other EERE program efforts 
focusing on the manufacturing of clean energy products as appropriate.
    Question. What action is the Department taking to ensure that 
public and private clean energy investments will provide benefits to 
the residents of rural areas, small cities, and towns commensurate with 
the benefits provided to residents of larger metropolitan areas? How do 
these efforts differ from last year? Rural areas have long struggled to 
keep up with critical infrastructure and, if agencies such as yours do 
not provide clear leadership, these rural areas could be at risk of 
missing out on major new public works projects and investments. Please 
provide me with the proportions of the program funding that have been 
committed to rural areas in the State Energy Program and the Energy 
Efficiency and Conservation Block Grant program.
    Answer. In the absence of statutory requirements, the Department of 
Energy (DOE) does not require States to allocate any specific 
proportion of State Energy Program (SEP) funding to either specific 
geographic areas or topics within the State. Through the SEP, DOE 
provides formula grant dollars to State Energy Offices (SEO) on behalf 
of each State. The SEO proposes energy efficiency and renewable energy 
programs that best fit the unique needs and resources within the State. 
DOE then reviews and approves the State programs and provides technical 
assistance as needed.
    The American Recovery and Reinvestment Act of 2009 appropriated 
$3.2 billion in funding for the Energy Efficiency and Conservation 
Block (EECBG) Program. Of this total, more than $2.7 billion is 
available for distribution in the form of direct formula grants to over 
2,350 eligible units of government such as cities and counties, States, 
U.S. territories, and Federal recognized Indian Tribes. This subtotal 
has been allocated, as directed by the Energy Independence and Security 
Act of 2007, to the following categories of grantees:
  --Sixty-eight percent to formula-eligible units of local government 
        (cities or city-equivalents with a population of at least 
        35,000 or that are one of the top 10 highest populated cities 
        of the State, and counties or county-equivalents with a 
        population of at least 200,000 or that are one of the top 10 
        highest populated counties of the State);
  --Twenty-eight percent to States through formula grants;
  --Two percent to Indian Tribes through formula grants; and
  --Two percent for competitive grants to ineligible cities, counties, 
        and Indian tribes (42 U.S.C. 17153(a)(1-4)).
    A State that receives a grant under the EECBG Program shall use not 
less than 60 percent of the amount received to provide subgrants to 
units of local government in the State that are not eligible for a 
direct formula grant from DOE. Hawaii, the U.S. Virgin Islands, 
American Samoa, Guam, and the Commonwealth of the Northern Mariana 
Islands have no ineligible entities and are, therefore, exempt from the 
requirement to make subgrants. For example, West Virginia received more 
than $14 million in direct formula awards to State and local 
governments. Out of this funding, over $9.5 million was awarded to the 
West Virginia State Energy Office, which must subgrant a majority of 
these funds under the requirement described above.
    The authorizing statute does not identify any eligible criteria 
that are specific to ``rural'' communities.
    Up to $453.72 million in Recovery Act funds will be awarded through 
competitive EECBG grants covering two topic areas, as described in 
Funding Opportunity Announcement DE-FOA-0000148.
    The first topic area, the ``Retrofit Ramp-Up'' program, will award 
funds to innovative programs that are structured to provide whole-
neighborhood building energy retrofits. DOE expects to make 8 to 20 
awards under this topic area, with award size ranging from $5 to $75 
million. Both formula eligible and formula-ineligible entities may 
apply for funds under Topic 1.
    The second topic area, the ``General Innovation Fund,'' will award 
up to $63.68 million to help expand local energy efficiency efforts and 
reduce energy use in the commercial, residential, transportation, 
manufacturing, or industrial sectors. DOE expects to make 15 to 60 
awards, with award size ranging from $1 to $5 million. Only formula-
ineligible entities can apply for funds under Topic 2. The award 
selection official may consider a proposed program's ``impact on, and 
benefits to, a diversity of communities, including low-income and rural 
communities'' when making selections per page 38 of FOA-0000148.
    These EECBG grants will almost certainly benefit small and rural 
communities beyond the direct recipients by adding substantially to the 
knowledge base surrounding the implementation and operation of energy 
efficiency/renewable energy projects (EE/RE). The grants will help to 
validate and refine best practices in a diversity of communities, 
including those with low-income and rural characteristics. These new 
data points will allow future EE/RE projects to be more closely 
tailored to the economic, environmental, and energy needs of Americans 
from all walks of life.
    Question. With my strong urging several years ago, NETL began 
performing work under the auspices of the Office of Legacy Management 
(LM). Most recently, these staff relocated to the new 59,000 square-
foot LM Business Center in Morgantown, West Virginia.
    I was advised in June 2008 by LM officials that the LM Business 
Center would house 30 Federal and 60 contractor staff. Please provide 
me with the current Federal and contractor staffing levels at the 
Morgantown site. If the goals provided to me in 2008 have not been met, 
I would like a detailed explanation on how and when these employment 
goals will be achieved.
    Answer. There are currently 9 Federal staff and 73 contractor staff 
at the Legacy Management Business Center (LMBC) located within the West 
Virginia University Research Park. None of these employees are 
associated with the National Energy Technology Laboratory. Over the 
last several years the Office of Legacy Management (LM) has been able 
to reduce total LM Federal staffing levels from an allocation of 83 to 
a current level of 57. This was accomplished by outsourcing work and 
using Federal employees from other organizations where it would be more 
efficient. Within the new staffing level there are presently 50 Federal 
employees in LM. We expect to hire additional Federal employees and 2-3 
of those employees would support activities at the LMBC. However, we do 
not anticipate needing beyond approximately 12 Federal employees at the 
LMBC in the foreseeable future.
    Question. Please describe in detail the functions that are being 
performed by Federal staff at the Morgantown site. Please provide the 
same detailed information about the contractor staff.
    Answer. Federal staff assigned to the LMBC perform a variety of 
functions. Those functions include: management and storage of records; 
information technology infrastructure services; oversight of LM site 
activities (e.g., ensuring compliance with environmental regulations 
and management of natural, historical and cultural resources); budget 
formulation and execution; acquisition support and oversight; and, 
management of personal property.
    The majority of contractor staff at the LMBC are associated with 
LM's primary mission at this location which is the management of 
records and information technology. Contractor staff performs the 
following types of functions: Information Technology, Records 
Management, and a variety of business services. These programs are 
based in Morgantown and support LM mission activities throughout the LM 
complex. LM's contractor also provides operation of the National 
Archives and Records Administration (NARA) certified Records Warehouse 
and the Consolidated Data Center; including environment, safety, and 
health oversight and conduct of operations.
    Question. Please provide me with a schedule of anticipated closures 
of DOE nuclear operations across the country. What effect will these 
closures have upon the demand for the functions performed at Morgantown 
and the staff levels?
    Answer. Responsibility for sites is transferred to LM after active 
remediation is completed, from programs within the Department of 
Energy, the Army Corps of Engineers, and from private licensees of 
former uranium mills. LM anticipates our site responsibility to grow 
from our current level of 87 to 112 by 2015. A list of sites projected 
to transfer by the end of 2015 is below. As a majority of the sites are 
in the Western United States, require only limited maintenance, and 
have small volumes of records and information we do not anticipate an 
increase in LMBC staffing levels.
    Bear Creek, Wyoming; Gas Hills East, Wyoming; Gas Hills North, 
Wyoming; Split Rock, Wyoming; Inhalation Toxicology Lab, New Mexico; 
Lisbon Valley, Utah; Mound, Ohio; Uravan, Colorado; Durita, Colorado; 
Panna Maria, Texas; Church Rock, New Mexico; Ford, Washington; Gas 
Hills West, Wyoming; General Electric Vallecitos, California; Mercury 
Storage Facility (location TBD); Ray Point, Texas; Iowa Army Ammunition 
Plant, Iowa; Painesville, Ohio; Attleboro, Massachusetts; Combustion 
Engineering, Connecticut; Highland, Wyoming; Latty Avenue Properties, 
Missouri; Sequoyah Fuels, Oklahoma; St. Louis Airport, Missouri.
    Question. What other LM functions could be housed in the new 
Morgantown facility?
    Answer. LM has consolidated several of its business functions at 
the LMBC including records storage and management, and information 
technology infrastructure. In addition, Federal staff at the LMBC 
provide oversight of certain LM site activities (e.g., ensuring 
compliance with environmental regulations and management of natural, 
historical and culture resources); budget formulation and execution; 
acquisition support and oversight; and, management of personal 
property.
    The documents to be stored, managed, and processed at the facility 
are inactive, temporary DOE records from the cold war nuclear sites. 
Records are retrieved to respond to various requests for information. 
The records currently stored at several NARA Federal Records Centers 
will be transferred to the LMBC for permanent storage.
    Over the last few years LM has worked hard to both evaluate and 
optimize Federal staffing levels and locations. Based on LM's current 
functions, the locations where those functions are most efficiently 
performed, and the distribution of our sites within the country we do 
not anticipate the transfer of other LM functions to the LMBC.
    Question. In February 2010, the President signed the Memorandum 
creating an Interagency Task Force on Carbon Capture and Storage (CCS). 
The Memorandum proposed a plan ``to overcome the barriers to the 
widespread, cost-effective deployment of CCS within 10 years, with a 
goal of bringing 5 to 10 commercial demonstration projects online by 
2016.''
    What is the status of your progress? What are your plans for going 
forward?
    Answer. In the President's Memorandum, the interagency carbon 
capture and storage (CCS) task force has 180 days to produce a report 
proposing a plan to overcome the barriers to the widespread, cost-
effective deployment of CCS within 10 years, with a goal of bringing 5 
to 10 commercial demonstration projects online by 2016. The task force 
is on track to deliver the report to President Obama in August, 2010. 
On May 6, 2010, at the Grand Hyatt Washington from 8:30 a.m. to 6 p.m. 
a public meeting was held to provide input to the interagency CCS task 
force.
    Question. How do these goals correlate with the Environmental 
Protection Agency's efforts to regulate mobile sources of greenhouse 
gas emissions this year and stationary sources of greenhouse gas 
emissions next year?
    Answer. An area that the interagency carbon capture and storage 
(CCS) task force will investigate is the legal and regulatory issues 
associated with CCS. Per the Presidential Memorandum, the Task Force 
will consider how best to coordinate existing administrative 
authorities, as well as identify areas where additional administrative 
authority may be necessary.
    Question. In June 2009, the administration released a Memorandum of 
Understanding (MOU) entitled, ``Implementing the Interagency Action 
Plan on Appalachian Surface Coal Mining.''
    The MOU noted that ``Federal agencies will work . . . to help 
diversify and strengthen the Appalachian regional economy and promote 
the health and welfare of Appalachian communities. This interagency 
effort will have a special focus on stimulating clean enterprise and 
green jobs development . . .''
    What new programs is the Energy Department proposing to advance 
economic diversification in Appalachia?
    Answer. This question should be directed to the U.S. Department of 
the Army, the U.S. Department of the Interior, and the U.S. 
Environmental Protection Agency. See http://www.epa.gov/owow/wetlands/
pdf/Final_MTM_MOU_6-11-09.pdf.
    Question. What new resources is the Energy Department requesting to 
advance economic diversification in Appalachia?
    Answer. The Department of Energy is not a party to this Memorandum 
of Understanding. This question should be directed to the U.S. 
Department of the Army, the U.S. Department of the Interior, and the 
U.S. Environmental Protection Agency. See http://www.epa.gov/owow/
wetlands/pdf/Final_MTM_MOU_6-11-09.pdf.
                                 ______
                                 
              Questions Submitted by Senator Patty Murray
    Question. Secretary Chu, I am pleased to once again see an increase 
in overall funding for EERE, because we've got to move forward toward a 
clean energy economy and the work being done at the Department will 
help keep us on that path.
    I am concerned, however, that for the second year in a row the 
Water Program has been cut--by 25 percent this year--while nearly every 
other renewable energy program receives increased funding. As you know, 
the National Hydropower Association recently released a report citing 
the potential for additional, emissions-free hydropower--and hundreds 
of thousands of jobs that could be created.
    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 baseload resources in the future.
    Given these recurring funding cuts for this important program, I am 
not assured that the administration sees the value of water as a clean 
energy source.
    Can you please tell me what your goals are for the Water Power 
Program, specifically with regard to conventional hydro as well as 
marine and hydrokinetic technologies?
    And is the Department using the Marine Science Laboratory at 
Sequim, Washington--the Department's only national lab facility located 
on water--to help achieve these goals, particularly to understand the 
environmental impacts of energy devices as the industry begins to test 
at scale?
    Answer. The Department of Energy is excited about the potential to 
develop emerging marine and hydrokinetic energy (MHK) technologies and 
untapped hydropower resources. The $50 million appropriated for Water 
Power in fiscal year 2010 has allowed the Department to continue 
aggressive efforts to develop advanced water power technologies, and we 
are working diligently to ensure that this increased level of funding 
is spent carefully and wisely. DOE believes that the $40.5 million 
requested for Water Power in fiscal year 2011 is sufficient to continue 
the program's ongoing efforts to develop water power technologies and 
accelerate the market adoption of these technologies. This funding is 
complemented by up to $31.7 million in Recovery Act funds for projects 
to deploy advanced turbines and control technologies at hydropower 
facilities, thereby boosting generation of environmental sustainable 
hydropower and stimulating job creation and economic activity. As the 
size of the Nation's water power resources and the ability of emerging 
technologies to capture that energy becomes clearer, the Department 
will be better able to determine if higher funding levels are 
necessary.
    The Department's goals for MHK energy technologies are to determine 
the baseline costs of energy and identify key cost drivers for MHK 
generation, to quantify the total MHK resource available by resource 
type, and to address barriers to the siting and permitting of these 
devices. For conventional hydropower, the Department's goals are to 
facilitate the deployment of new sustainable hydropower generating 
capacity, including timely and low-cost upgrades at existing 
hydroelectric facilities, the powering of non-powered dams and 
constructed waterways, and assessing the potential for new small 
hydropower deployment. The Department also works with other Federal 
agencies, such as the Army Corps of Engineers and the Department of the 
Interior's Bureau of Reclamation, to support the development of 
environmentally sustainable hydropower by increasing energy generation 
at Federal-owned facilities and exploring opportunities for new 
development of low-impact hydropower.
    The Water Power Program has funded MHK technology research at 
Pacific Northwest National Laboratory (PNNL) since fiscal year 2008, 
and the capabilities of PNNL's Sequim Marine Science Laboratory have 
been integral to that effort. Given Sequim's coastal location and 
strong marine environmental research capabilities, much of the work 
undertaken at the Sequim facility has been related to environmental 
baseline studies for MHK technology applications. PNNL is currently 
leading an effort to identify, analyze, and predict environmental 
impacts from MHK energy production. After prioritizing risks, PNNL will 
conduct experiments and field trials to investigate high priority 
environmental impacts to reduce uncertainty, and to gain insight into 
the cumulative impacts of multiple stressors from devices and arrays.
    Question. Mr. Secretary, as you may know in January, as Chairman of 
the U.S.-China Inter-Parliamentary Group, I led a Congressional 
Delegation trip to China. Part of our charge was to focus on a variety 
of bilateral issues, including energy. If our two nations are to 
aggressively deploy clean energy technologies, much needs to be done to 
spur innovation across the energy sector to increase renewable energy 
use as well as reduce greenhouse gas emissions from coal fired 
electricity plants.
    I know that DOE is doing much to drive a green energy future, and 
recognize the need to continue to invest in fossil energy programs. We 
know that current available technology is too expensive. I am concerned 
that the fiscal year 2011 DOE budget request seems to be missing 
programs that will drive the innovation we need now for successful 
deployment in a decade.
    Can you please comment on DOE's intentions for developing a 
significant national program that rapidly accelerates revolutionary 
approaches to carbon capture?
    Answer. In the fiscal year 2011 budget request the Office of Fossil 
Energy (FE) requested over $84 million for capture technology. This 
funding will support bench and laboratory scale R&D for post combustion 
capture techniques such as solvents and sorbents. Pre-combustion 
capture funding will support the development of novel bench scale pre-
combustion capture technology. In addition, the Advanced Research 
Projects Agency--Energy (ARPA-E) is supporting CCS research and 
development of next generation carbon capture technology with funds 
provided by the American Recovery and Reinvestment Act. The Office of 
Science is supporting R&D into the design of novel materials and 
separation processes for post-combustion CO2 capture, as 
well as catalysis and separation research for novel carbon capture 
schemes that might be incorporated into the design of future power 
plants. These three programs, which closely coordinate, support the 
research and development necessary to reduce the cost and energy 
penalty associated with carbon capture technologies.
    Question. Also, can you please tell me what methods the Department 
is looking at in addition to carbon capture and sequestration, such as 
carbon capture and recycle?
    Answer. The American Reinvestment and Recovery Act allocated to the 
Department $1.52 billion to support industrial carbon capture and 
storage (CCS) projects. Of the $1.52 billion, $17.4 million was 
allocated for industrial CCS applications is to test innovative 
concepts for the beneficial use of CO2. Historically, 
enhanced oil recovery projects have been injecting CO2 to 
stimulate the production of oil, and that is expected to expand as 
CO2 becomes more readily available. In addition, FE has a 
solicitation, which closed April 20, 2010, targeting technologies that 
utilize CO2 to produce products at a cost of less than $10 
per metric ton.
    Question. Mr. Secretary, can you give me an update on the 
implementation of the U.S.-China Energy Research Centers? How are you 
implementing this program within the various offices at DOE and are you 
engaging the national labs who are also developing relationships with 
their Chinese counterparts?
    Answer. On March 30, 2010, the Department released a funding 
opportunity announcement (FOA) with the availability of $37.5 million 
over the next 5 years to support the U.S.-China Clean Energy Research 
Center (CERC). Funding from DOE will focus on advancing technologies 
for building energy efficiency, clean coal including carbon capture and 
storage (CCS), and clean vehicles. These are areas in which the United 
States and China have a shared interest in further developing 
technology to help our countries meet clean energy and climate change 
goals. Awards will be made to consortia with the knowledge and 
experience to undertake first-rate collaborative research programs. 
These consortia will help bring together top talent from both countries 
and are expected to generate key technological advancement through 
genuine collaboration between U.S. and Chinese researchers. The DOE 
funding will only go to American researchers and institutions, and 
grantees will match the Department's funding dollar for dollar, 
bringing the United States' contribution to $75 million. All proposed 
projects must involve researchers from both countries. DOE anticipates 
notifying the applicants selected for awards and making the awards in 
summer 2010.
    The implementation of the U.S.-China Clean Energy Research Program 
will be administered by the Office of Policy and International Affairs, 
through a CERC secretariat, to be established and housed at the DOE 
headquarters. The secretariat will act as the principal coordinator of 
activities under the CERC. The Office of Fossil Energy (on clean coal 
and CCS), and the Office of Energy Efficiency and Renewable Energy (on 
building energy efficiency and clean vehicles) will have strong roles 
in supporting the CERC activities, along with the support from DOE 
national laboratories. In addition, DOE national laboratories are also 
eligible to apply as prime applicants.
    Question. I know you when you visited the Pacific Northwest 
National Laboratory last year that you toured the Electricity 
Infrastructure Operations Center (EIOC). This center will be an 
important platform for advancing the smart grid and will be utilized in 
the Pacific Northwest Smart Grid Demonstration that is funded by the 
Recovery Act. What are DOE's plans to follow up on that investment, and 
what must DOE and the Federal Government do to ensure that the 
transition to the smart grid is completed?
    Answer. DOE research and development funds helped establish the 
EOIC, and we expect it to continue to be a great asset in facilitating 
further research, as well as in validating technologies, systems and 
processes that advance the concept of a smart grid. Given its unique 
capabilities, we expect ongoing research, development and demonstration 
funds will continue to support Pacific Northwest National Laboratory, 
and the EOIC.
    The transition to a smart grid is a process that will take years, 
and the role of the Federal Government is to ensure that progress is 
prudent, efficient, and validated by solid research. The Federal 
Government can also work to advance the transition by testing the next 
generations of technical and policy solutions to improve the 
electricity infrastructure, in collaboration with industry, academia, 
and our state partners.
                                 ______
                                 
               Questions Submitted by Senator Tom Harkin
    Question. Dr. Chu, the Energy Policy Act of 2005 included the 
Renewable Fuel Standard commonly referred to as RFS2. It requires use 
of 15.2 billion gallons of biofuels in 2012, and 20.5 billion gallons 
in 2015. It is clear most of that fuel will be in the form of ethanol. 
At the same time, we are facing a challenge with integrating these 
increasing volumes of ethanol into out transportation fuels market. 
Specifically, these volumes go beyond the ``ethanol blend wall'' 
meaning the amount of ethanol that can be utilized in form of E10--fuel 
blends of 10 percent ethanol in gasoline. Now that problem will be 
somewhat alleviated if EPA grants a waiver that allows use of blends 
such as E15 in all highway vehicles, but what we really need are more 
flex-fuel vehicles that can use higher blends and more refueling 
stations that offer higher blends through the use of blender pumps.
    Your Clean Cities Program is increasing the use of alternative 
fuels, but your budget for that program allocates over half of funding 
to support electric vehicles.
    Given that electricity already is widely available while electric 
vehicles are still pretty scarce, and that we have this ethanol market 
limitation, why aren't you putting the major emphasis on your clean 
cities program on availability and use of higher ethanol blends?
    To me, it's very clear that ethanol offers by far the greatest 
potential for reducing our dependence on petroleum for at least the 
next decade. Isn't it in our national energy security interest to make 
sure we can take full advantage of the petroleum displacement potential 
that ethanol provides?
    Answer. DOE has continued to demonstrate strong support for 
deployment of E85 blends with recent financial assistance awards. In 
2009, Clean Cities awards were announced that will help build an 
additional 198 E85 refueling locations during the 2010-2012 timeframe 
in more than 20 States through the Recovery Act and under a separate 
set of Clean Cities infrastructure grants. In 2006, DOE Clean Cities 
helped fund 169 E85 stations. Moreover, DOE Clean Cities continues to 
support the more than 2,000 E85 stations in the United States by 
providing user-friendly web-based station locators and mapping tools 
for convenient trip planning for flex-fuel vehicle (FFV) drivers and 
owners. In addition, in fiscal years 2007-2010, the Department funded a 
$45 million test program focused on intermediate blends of ethanol in 
gasoline for blends up to E20. This program, intended to provide high-
quality data to the Environmental Protection Agency for use in 
considering current and future ethanol blend waiver requests, covers 
materials compatibility, emissions, long-term durability of exhaust 
emissions control systems, and operational issues for E15 and E20 for 
new and legacy vehicles and non-road engines. The Department is also 
evaluating the compatibility of new and legacy fueling infrastructure 
equipment with intermediate blends; a portion of this infrastructure 
testing has been funded through the Clean Cities Program. In a separate 
but related effort, Clean Cities has also engaged in studies of blender 
pumps and E85 fuel quality surveys.
    For the fiscal year 2011 budget request, a portion of the Clean 
Cities budget is focused on activities related to electric vehicles and 
the infrastructure needed to support them. It is estimated that 15 to 
20 new battery electric and 9 to 10 new plug-in hybrid electric vehicle 
models will be introduced by 2012, and that a million of these vehicles 
will be on the road by 2015 (which all need recharging stations). In 
addition, communities where electric vehicles are being introduced will 
need training for first responders, equipment installers and vehicle 
technicians. Clean Cities funding proposed in the fiscal year 2011 
budget request would support these efforts and strengthen the 
participation of local coalitions.
    While there is no question that high-level ethanol blends are 
important for U.S. energy security, the combination of E85 flex fuel 
technology and electric drive offers even greater potential. For 
example, General Motors has mentioned the possibility of a Chevy Volt 
extended range electric vehicle that could be E85 flexible fuel capable 
after 2010. It is an understatement to say that the combination of a 
plug-in vehicle that can also run on ethanol instead of petroleum will 
be an important event for promoting petroleum reduction--a key mission 
of the Clean Cities program and the Office of Energy Efficiency and 
Renewable Energy.
    Question. The Artificial Retina Program at DOE has been an 
incredible success and was recently named a 2009 R&D 100 Award Winner. 
The real potential this program has to restore sight to over 10 million 
blind people in the United States could be a historical accomplishment 
for the DOE Science Program. The fiscal year 2011 budget includes only 
$4 million for this program, and it includes detrimental language to 
terminate the program at DOE at the completion of the 240 electrode 
device, rather than the 1000 electrode device, which was the original 
intention of the program. While NIH has been a partner with DOE in 
doing the clinical trials, they simply cannot pick up the program now 
and develop the 1000 electrode device. With over $70 million already 
invested in this program at DOE, I think it would be a gross mistake to 
prematurely end this program when it is so close to developing a 
technology that would help so many people. Given that this program has 
met every benchmark thus far, and DOE has already made a substantial 
investment in the program, why is DOE terminating the successful 
Artificial Retina Program when the final goal of the 1000 electrode 
device is so close to being achieved?
    Answer. The original intention of this interagency program was to 
develop robust partnerships synergistically linking the strengths of 
the national laboratory, academic, and industrial researchers through 
proof of concept demonstration and engineering of a retinal prosthetic 
device. DOE supports fundamental research and technology development to 
advance DOE missions in energy, climate, and the environment, and is 
working to transition this successful project to other agencies with 
more direct mission responsibility for clinical research. The current 
60 electrode device is in the midst of clinical trials, and early 
clinical trial results have allowed researchers to improve the design 
and fabrication of the 240 electrode device. Synthesis of the 
individual components of the 240 electrode device is expected to be 
complete at the end of fiscal year 2010. The $4 million in the fiscal 
year 2011 budget is designated to facilitate an orderly transition of 
the device through pre-clinical testing and complete additional 
technology research required to bring the device to readiness for 
clinical trials led by partnering organizations. Increasing the number 
of electrodes does not guarantee improved clinical performance. The 
benefits of the 240 electrode Artificial Retina device will not be 
assessed until it enters formal clinical trials and statistically 
significant patient results are demonstrated. Since the early clinical 
testing results are just emerging for the Argus II 60 electrode device, 
the results from the 240 electrode device testing will be critically 
important to design any further device improvements and to determine 
whether those improvements should be specifically focused upon higher 
electrode density or improved neural and visual processing software 
development. Through implementing device improvements informed by 
clinical trial testing of the 240 electrode device, the goal of 
improving visual acuity to many people can be best realized.
    DOE has contributed to the success of the Artificial Retina Project 
through its contributions in materials sciences and microfabrication of 
components, and it is important to transition the work to organizations 
that have a more direct role in the clinical testing and development 
and application.
                                 ______
                                 
            Questions Submitted by Senator Robert F. Bennett
    Question. Approximately $2.5 billion (7 percent) of the $36.7 
billion appropriated in the American Reinvestment and Recovery Act, 
enacted over a year ago, has been spent. While around $25 billion has 
been obligated, it's the funds that have been ``costed'' that mean jobs 
and results.
    Why is the pace so slow getting these funds out?
    Answer. As enacted, the Recovery Act's estimated cost of $787 
billion came in three pieces: roughly a third in tax cuts directly to 
the American people, another third in emergency relief for hard-hit 
families, businesses, and State governments, and a third in investments 
in the infrastructure and technology, creating platforms for economic 
growth. The Department of Energy's Recovery program focuses on the 
third leg, accelerating innovation to lay the foundation for long-term 
economic growth.
    From the first day after the Recovery Act was signed into law, DOE 
has been focused on moving the money out the door quickly to create 
jobs and spur economic recovery. We have used competitive processes to 
select exceptional projects. We have streamlined DOE operating 
processes across the board. We are providing unprecedented transparency 
and insist on clear accountability every day.
    DOE has $36.7 billion in appropriations, including $32.7 billion in 
contract and grant authority and $4 billion in loan credit subsidy 
authority. We have made selections for over $32 billion (98 percent) of 
our contract and grant authority. In total, we have obligated $29.4 
billion (90 percent) and outlaid over $5.1 billion (16 percent). 
Environmental Management has paid out $2.3 billion in outlays and 
weatherization has now outlaid over $1 billion. Working with Treasury, 
we have also supported the processing of $7 billion in additional tax 
awards: $4.7 billion in 1603 grants in-lieu of tax credits and $2.3 
billion in 48c tax credits.
    We will be finalizing our remaining selections in the next 3 months 
with the exception of loan guarantees. DOE will finalize selection of 
section 1705 loan guarantees by September 30, 2011.
    We have obligated $29.4 billion (90 percent of contract and grant 
authority). We are on track to obligate nearly 100 percent of our 
contract and grant authority by September 30. Since the March 10 
resolution of the Smart Grid Investment Grant tax issues, OE has fully 
obligated all 100 Smart Grid Investment Grant projects and most of the 
Smart Grid Demonstration Grant projects. We sent nearly 20 HQ staff to 
the field to help in the negotiation process of the Retro-fit Ramp-Up 
awards. In just 5 weeks, they fully obligated all 25 awards ($450 
million). For all new selections, programs are using SWAT teams to 
ensure expeditious obligation. No major delays are expected. Fossil 
Energy and Loans will be the last to obligate.
    We have outlaid over $5.1 billion (16 percent of our contract and 
grant authority). We outlaid nearly $700 million in May and are on our 
way to $750 million in June. In addition to the various renewable 
energy research, development and deployment programs, three of the 
department's largest Recovery Act programs the Environmental Management 
Program and the Weatherization Assistance Program, and the Science 
Program are all at run rate. In the last 2 months, the vehicles program 
has ramped up operations and surpassed its May target by nearly $18.5 
million. Over the last 3 months, we have seen an average payment growth 
rate of 18 percent month-to-month. We outlaid $472 million in March and 
$569 million in April. We expect to hit reach our optimal monthly spend 
rate of $800 million to $1 billion this quarter.
    In the first quarter of 2010, Department of Energy created and 
saved nearly 29,000 direct FTEs jobs at the prime and sub-recipient 
level. DOE has seen an average 50 percent quarter-to-quarter increase 
in recipient reported jobs. Recovery Act investments in the Office of 
Weatherization and Intergovernmental Program (OWIP) and Environmental 
Management program have seen the largest job creation. Going forward, 
DOE expects significant job creation from Recovery Act renewable energy 
and smart grid projects.
    Question. When do you expect to have the full amount actually 
spent--not just obligated?
    Answer. DOE Recovery Act appropriations are funding 144 projects, 
aside from loan guarantees, in 10 different program offices (e.g., 
Energy Efficiency, Fossil Energy, Science, etc.). Each of these 
projects has a unique structure and statutory time horizon for the 
deployment of these funds (i.e., R&D vs. infrastructure investment). 
For example, DOE's Office of Environmental Management has allocated 
nearly $6 billion in Recovery Act funding to 17 sites with a goal to 
complete their work by the end of fiscal year 2011. Large scale, heavy 
infrastructure projects in the Fossil Energy program require extensive 
design and construction stages that will take their Recovery Act 
spending out until fiscal year 2014. As an agency, DOE expects to spend 
70 percent of its ARRA funds by the end of CY2011, nearly 90 percent by 
CY2012, and 100 percent by CY2015.
    Question. Why are there still unresolved tax issues for smart grid 
grantees, more than a year after enactment of the bill, and what is the 
Department doing to address them?
    Answer. The tax issue has been resolved for the Smart Grid 
Investment Grant program, and finalization of the grants is well 
underway. On March 10, 2010, the Internal Revenue Service announced a 
determination on the tax treatment for grantees receiving Recovery Act 
funding under the $3.4 billion Smart Grid Investment Grant program. 
Under the revenue procedure, the Internal Revenue Service is providing 
a safe harbor under section 118(a) of the Internal Revenue Code (IRC) 
for corporations receiving funding under the Smart Grid Investment 
Grant program. With the determination that Smart Grid Investment Grants 
to corporations are non-taxable, corporate utilities will be able to 
launch their investments with a clear indication of the tax status for 
their projects.
    The Internal Revenue Service revenue procedure specifically did not 
apply to Smart Grid Demonstration grants because the programs, which 
are authorized by different statutory provisions, differ in several 
ways that may affect whether DOE's financial assistance can qualify as 
permanent contributions to capital under section 118(a). As a result, 
grantees under the different programs will require separate 
explanations for how the tax code applies. There are also fewer 
corporate recipients of Smart Grid Demonstration grants than of the 
Smart Grid Investment Grants. DOE has asked recipients of Smart Grid 
Demonstration grants to identify whether such tax treatment is 
applicable and necessary for the success of their projects and will 
consider recipients' responses in determining a path forward. 
Regardless, each recipient is free to pursue use of section 118 on its 
own, as well as any other tax treatment it believes is applicable.
    Question. Approximately $6 billion was provided for the 
Environmental Management (EM) program in the Recovery Act. A number of 
the sites are not currently on track to meet cost and schedule 
estimates. Why is this the case, and what steps is EM taking to address 
these issues?
    Answer. The Recovery Act requires all funding to be obligated by 
the end of fiscal year 2010, and spent within 5 years of obligation. 
The Office of Environmental Management (EM) established a very 
aggressive goal of spending the majority of the money by the end of 
fiscal year 2011 in order to maximize the creation of jobs. The EM 
Recovery Act program has obligated more than $5.4 million of the $6 
billion of Recovery Act funding, and more than $2.3 billion has been 
paid out. Approximately 10 percent of the 91 EM Recovery Act projects 
are now scheduled to extend into fiscal year 2012. In regard to project 
performance, a recent GAO report identifies that a number of the 
Recovery Act projects are not currently meeting their original cost and 
schedule goals. Examples of these project variances include: greater 
than initially planned volumes of contaminated soils, resulting in 
higher costs for excavation and disposal; delays due to changes in 
initial waste type characterization assumptions; and contract issues 
causing delays in work start date.
    EM Senior Management continues to be fully engaged with all the 
Recovery Act projects on a regular basis, including monthly project 
reviews with each of the sites. EM Management also requires each 
project with less than satisfactory performance to develop a recovery 
plan that fully defines the issues and contains the corrective actions 
necessary to bring the projects back on-track and within cost and 
schedule. At this time it appears that all of the projects are 
recoverable and will meet Recovery Act performance objectives.
    Question. The President recently named a prestigious group of 
individuals to form a Blue Ribbon Commission on Nuclear Waste. The 
chairmen are Lee Hamilton and General Brent Scowcroft. The Commission 
is expected to make recommendations within 18-24 months.
    What should we expect from the Blue Ribbon Commission?
    Answer. In my comments at the first open meeting of the Blue Ribbon 
Commission on America's Nuclear Future (the Commission) on March 25, 
2010, I set forth several of my expectations for the Commission, which 
include a comprehensive review of the science, technology and other 
factors that influence the back-end of the fuel cycle. In addition, the 
Commission's charter specifies that this comprehensive review includes 
an evaluation of alternatives for storage, processing, and disposal of 
civilian and defense used nuclear fuel, high-level waste, and materials 
derived from nuclear activities, to be followed by advice and 
recommendations on a new plan to address these issues. I am confident 
the Commission will render useful advice and recommendations and 
fulfill its mission and responsibilities under its charter.
    Question. How aggressive will the administration be in pursuing a 
permanent solution to the back end of the nuclear fuel cycle?
    Answer. The establishment of the Commission speaks to the 
administration's commitment to a well-considered policy for managing 
used nuclear fuel and other aspects of the back end of the nuclear fuel 
cycle. The administration, armed with the final report from the 
Commission, is committed to working with Congress, States, and local 
governments to develop an effective strategy to meet the Government's 
obligation to dispose of our Nation's used nuclear material.
    Question. What impact has the proposed closure of Yucca Mountain 
had on the clean-up plans, as far as the existing tripartite agreements 
and their associated milestones, for high level waste at Hanford, Idaho 
National Laboratory, and Savannah River?
    Answer. The administration's decision not to proceed with the Yucca 
Mountain repository does not affect the Office of Environmental 
Management's (EM) plans to retrieve, treat, and store high-level wastes 
stored in tanks or to treat and store spent nuclear fuel. EM is focused 
on addressing environmental and health risks by placing high-level 
waste and spent nuclear fuel in safe and stable configurations. We 
intend to continue our tank waste projects as planned and in accordance 
with our compliance agreements as reflected in the fiscal year 2011 
budget request.
    Question. How will the administration pay for the awards such as 
the one recently announced for Energy Northwest?
    Answer. All funding for settlements and damages awarded utilities 
in the ongoing litigation between the Government and the utilities for 
the Department's delay in accepting spent nuclear fuel from utilities 
by 1998 under the contracts is provided by the Judgment Fund in the 
U.S. Treasury.
    Question. Regardless of what path we pursue in the future, some 
type of geologic repository will be needed for radioactive material 
stored at Hanford. The extensive scientific record that has been 
developed for Yucca Mountain would be extremely useful toward informing 
and providing lessons learned for any future repository program. What 
steps are you taking to ensure that this record will remain available 
for this purpose?
    Answer. The Department is committed to preserving the scientific 
knowledge created through the Yucca Mountain Project. Records generated 
by the Office of Civilian Radioactive Waste Management (OCRWM) are 
managed and archived in accordance with the requirements of the Federal 
Records Act and related regulations. Paper and electronic media records 
that have been archived are stored at several National Archives and 
Records Administration Federal Records Centers (FRC) under FRC 
regulations, as well as in a DOE-leased facility in Las Vegas. In 
addition to records on paper and electronic media, images of records 
are electronically maintained in our Records Information System and 
DOE's documentary material relevant to the Yucca Mountain licensing 
proceeding is electronically available on the Licensing Support 
Network.
    Question. Why did the administration move to withdraw the licensing 
application before NRC with prejudice rather than without prejudice?
    Answer. As explained in its Motion to NRC's Atomic Safety and 
Licensing Board to Withdraw the pending license application with 
prejudice, the Department seeks this form of dismissal to provide 
finality in ending the Yucca Mountain project and to enable the Blue 
Ribbon Commission to focus on alternative methods of meeting the 
Federal Government's obligation to take high-level waste and spent 
nuclear fuel.
    Question. DOE's loan guarantee program was authorized in 2005. 
Since that time only one final commitment has been made and five 
conditional commitments. Applicants have complained about the lack of 
transparency, the unwieldy application process (which differs depending 
on the sector), and DOE's complete risk-adversity (risk is impossible 
to avoid for small companies launching new technologies). DOE has 
identified multiple goals for the Loan Guarantee program--promoting 
innovation in the energy sector, helping to develop the capacity to 
confront the challenges that climate change poses, jumpstarting the 
construction of new nuclear reactors, ensuring the affordability of 
energy, and bolstering the competitiveness of the United States in 
global energy markets.
    How is DOE prioritizing these ambitious goals and, as a practical 
matter, using them to select which projects to support?
    Answer. Since issuing its first conditional commitment in March 
2009, as of April 1, 2010, the Loan Guarantee Program has closed one 
loan guarantee and issued conditional commitments for seven additional 
projects. Projects supported by the Loan Guarantee Program reach 
conditional commitment and ultimately financial close based on each 
individual project's ability to fulfill the requirement outlined in the 
Energy Policy Act of 2005, its Final Rule and the relevant 
solicitation.
    Question. DOE had planned to make a minimum of 21 conditional 
commitments for projects supported under the Recovery Act by the end of 
2009. Instead, the Department made a total of 4 conditional 
commitments. While the Department has made a few additional conditional 
commitments since then, DOE is still far short of its target. What 
explains the program's difficulty in adhering to its plan? What steps 
are being taken to address the sources of delay?
    Answer. The Loan Guarantee program had substantial achievements in 
2009 issuing four conditional loan guarantee commitments, one of which 
reached financial closing and issuance of the loan guarantee in 
September. The Program Specific Recovery Plan was based on best 
estimates at the time, developed very early in the planning process
    Question. What steps are being taken to ensure that the program 
will issue enough loan guarantees to use the funding authority provided 
under the Recovery Act before September 30, 2011, when funding 
authority expires?
    Answer. The Loan Guarantee Program has a robust pipeline of 
projects eligible for both appropriated credit subsidy under the 
Recovery Act and able to meet the Recovery Act requirement to begin 
construction by September 30, 2011. In addition, the Loan Guarantee 
Program has two open solicitations and continues to receive 
applications from eligible projects.
    Question. I understand the application review process differs by 
the type of technology. Applicants with nuclear power generation 
projects received a ranking from DOE before submitting the full 
application fee, while applicants with coal-based and other types of 
projects did not. Applicants with some types of technologies were 
allowed to brief DOE and explain their projects after submitting their 
applications while others were not, potentially denying them the 
opportunity to clear up misunderstandings about their projects. Why are 
applicants treated differently in these regards?
    Answer. DOE strives to treat all applicants on an equitable basis. 
DOE understands that communication with applicants is critical as they 
seek to make business decisions. While the ultimate decision to issue a 
loan guarantee rests with the Department, DOE endeavors to provide 
early and thorough feedback to help all applicants make informed 
decisions regarding their application.
    Question. Given how substantial the credit subsidy fees can be for 
applicants--an average of about 12 percent of the loan guarantee 
amount, and potentially more for some applicants--when in the 
application process are you giving applicants estimates? How long have 
they waited and how much money have they generally spent before 
receiving these estimates? How precise are these estimates?
    Answer. Self-pay applicants can receive an estimated Credit Subsidy 
Cost, given as a range, early in the loan guarantee process. The 
Department has developed a process to provide estimates to applicants 
at key points in the application process. The intent of this process is 
to provide applicants with estimates of the likely cost so that they 
can use them for planning purposes. DOE produces early range estimates 
for self pay applicants under 1703.
    The length of the due diligence process depends on the 
completeness, robustness and simplicity of the project. During this 
period, companies pay all associated legal and contractor fees, which 
are comparable to costs assumed for equivalent work in the private 
sector, and vary widely across technology sectors.
    Question. About 90 percent of DOE's budget (over $22 billion 
annually) is spent on contracts. DOE is the largest contracting agency 
in the Government after the Department of Defense. In 1990, GAO 
designated DOE contract administration and project management as ``high 
risk'' because of DOE's record of inadequate management and oversight 
of contractors, and failures to hold contractors accountable. The 
National Nuclear Security Administration and Environmental Management 
program, which account for the majority of DOE's contract budget, 
continue to experience significant problems.
    DOE over the past several years has issued new guidance on 
performance-based contracting, including how to develop performance 
measures and incentives to motivate contractors to achieve results. 
What additional actions can the department take to hold its contractors 
accountable for meeting cost, schedule, and technical performance 
targets on projects?
    Answer. In addition to performance measures set forth in individual 
contracts, the Department has undertaken a Root Cause Analysis (RCA) 
and is implementing fundamental systemic reforms that are being 
implemented under its Corrective Action Plan (CAP) to improve contract 
and project management. In addition to the long term improvement in the 
ability of the Department to meet its commitments on projects and 
contracts that are expected as a result of the RCA/CAP implementation, 
the Department is beginning to realize benefits as measured by the 
percentage of the total project cost (established at Critical Decision-
2) that meet the performance metrics for capital asset projects and 
environmental cleanup projects. For capital asset line item projects, 
the percentage of projects that are within 110 percent of the Critical 
Decision-2 Total Project Cost has improved from the baseline level in 
2007 of 70 percent to the current projected level of 100 percent. A 
similar trend is noted for Environmental Management cleanup projects. 
For those projects baselined after the 2007 CAP, the projected 
percentage within 110 percent of the Critical Decision-2 Total Project 
Cost is 100 percent. While there are continuing challenges on the older 
projects, those that were baselined after 2007 exhibit greater schedule 
and cost discipline and are testimony to the continued improvements in 
major acquisition management within the Department. Specific activities 
undertaken as part of the RCA/CAP that will promote greater contractor 
accountability include:
  --Improved project front-end planning and requirements definition by 
        the Government will permit large projects to be segmented into 
        smaller, better defined requirements that will support a shift 
        to awarding more firm-fixed-price contracts. This reflects a 
        shift of cost and performance risk to the contractor and is in 
        alignment with President Obama's March 4, 2009, memo on 
        Government Contracting.
  --A new algorithm will be used by Federal project directors to 
        analyze functional staffing requirements to ensure that major 
        projects have adequate staffs to perform contract and project 
        oversight.
  --Additional training of Federal contract and project management 
        workforce will ensure that the Government has the skill sets to 
        perform the necessary project and contract oversight function.
  --Better integration of the Government contract and project 
        management functions in the acquisition planning process will 
        ensure that contractor accountability is built into the 
        contract terms and that conditions and enforcement mechanisms 
        are in place.
  --A new Project Assessment and Reporting System (PARS-II) will upload 
        contractor schedule, cost, and performance data from the 
        contractors systems into the Government system to provide 
        consistent, transparent, and reliable data to all levels of DOE 
        management.
  --Expanded use of project peer reviews modeled on those in the Office 
        of Science, which has successfully and consistently delivered 
        projects on budget and schedule, is expected to improve overall 
        project execution.
  --Rigorous change control processes are in place and will mitigate 
        cost growth on contracts and projects.
  --Knowledge management will be improved by piloting a Project 
        Management lessons learned program (ProjNet and the DOE 
        Corporate Lessons Learned system) to collect and disseminate 
        information and knowledge from past projects.
    Question. Please describe how you systematically reward best 
performers, and use disincentives for poor performers?
    Answer. DOE uses a variety of mechanisms to reward high quality 
performance and to hold contractors accountable for poor performance. 
Specific tools used are: effective use of past performance information; 
targeting award and other incentive fees to areas of concern; not using 
base fee on cost-plus-award-fee contracts; and paying no fee if 
contractors do not meet minimum levels of safety and security.
    DOE recognizes contractors that deliver quality service by giving 
them past performance credit for good performance when making 
selections for future contracts. Past performance is a meaningful 
source selection factor in the award of negotiated acquisitions. DOE 
ensures its past performance information, which is reported 
electronically through its Contractor Performance Assessment Reporting 
System to the Past Performance Information Retrieval System, is 
accurate by its systems of internal procedures and control. These 
controls include DOE's Procurement Management Review, Balanced 
Scorecard Self Assessment, and Data Quality Review programs.
    DOE considers a cost-plus-award-fee contract the appropriate 
contract type for DOE management and operating and other facility 
contracts. DOE does not generally use base fee on these contracts. All 
at-risk fee is dependent upon performance. DOE includes a conditional 
payment of fee clause in its management and operating and other 
facility contracts that reduces or entirely eliminates any fee the 
contractor would otherwise earn if the contractor has not met the 
safety and security requirements of the Department. This recoupment 
provision is an exceptionally strong incentive for contractors to 
perform critical functions well.
    Question. How do you apply ``lessons learned'' across all contracts 
throughout all programs?
    Answer. DOE has a robust program of continual guidance 
dissemination throughout the Department. Guidance is released through 
Policy Flashes, Acquisition Letters, new and updated Acquisition Guide 
Chapters, and Memorandums from the Senior Procurement Executive. This 
program includes sharing of lessons learned from recent procurements, 
from internal reviews, and from reviews conducted by outside groups 
such as the Department's Inspector General and the Government 
Accountability Office. Internal reviews include the Procurement 
Management Review that documents finding and best practices within a 
knowledge management tool--a Web site that supports sharing of the 
lessons learned and best practices in the areas of acquisition, 
financial assistance, contractor pension/benefit management and 
property management.
    In fiscal year 2008, the Department implemented a robust, 
comprehensive Procurement Management Review (PMR) Program. This program 
determines how effectively and efficiently the field area and site 
contracting organizations support their respective site mission 
requirements. It emphasizes the evaluation and compliance of critical 
contracting processes that are key. In addition, the program identifies 
noteworthy practices for export throughout the Department as well as 
deficiencies and obstacles to avoid. This knowledge management 
component of the program is facilitated by a headquarters core review 
team augmented by experienced field contracting personnel. Integration 
of experienced field staff with senior-level headquarters staff 
facilitates the transfusion of knowledge and experience among and 
between DOE's contracting activities via the sharing of lessons learned 
and best practices. The team incorporates peer reviews from other DOE 
procurement/financial assistance locations and helps spread practices 
throughout the Department.
    Additionally, DOE created a position titled ``Source Evaluation 
Board (SEB) Secretariat and Knowledge Manager (SKM)'' specifically 
tasked with ensuring that lessons learned are recorded and shared 
across the Department. The SKM developed a ``SEB lessons learned'' 
template and all SEBs whose acquisition value exceeds $25 million must 
document their lessons learned, which will be shared with all DOE 
procurement personnel. The lessons learned will be analyzed for trends, 
and areas where additional guidance, and/or policy may be needed. The 
SKM is also responsible for source selection training for SEBs, and the 
establishment of SEB reporting requirements and tracking the status of 
SEB activities against established milestones. A monthly SEB reporting 
requirement has been put in place, and both lessons learned and trends 
will be identified and shared with DOE procurement personnel.
    Question. Last year we were told the Department faced a major 
crisis with funding for its contractor pension programs. I understand 
you have changed the way you are budgeting for pensions and the problem 
is less of a crisis.
    Could you please explain in detail the changes in budgeting you 
have or intended to implement?
    Answer. Due to the rising costs for the reimbursement of DOE 
Management and Operating (M&O) and major site management contractor 
employee defined benefit (DB) pension plan contributions, the 
Department has improved and strengthened its management and oversight 
of DB pension plans.
    Specifically, in January the Department eliminated the requirement 
that every contractor employee DB pension plan be funded--and thus 
annual contributions budgeted--at the 80 percent level. The new 
reimbursement action requires the Department to reimburse contractors 
for the amounts required to fund their DB pension plans at a level 
equivalent to the minimum amount required by the Employment Retirement 
Income Security Act (ERISA) as amended by the Pension Protection Act 
(PPA), or higher if necessary for a contractor DB pension plan to have 
a funded status of at least 60 percent. Exceptions to the new 
reimbursement action will be reviewed on a case-by-case basis. 
Additionally, the Department has institutionalized an annual pension 
management plan review process with the specific objective of improving 
cost predictability and containing current and future costs. Each 
contractor is required to provide annual DB pension plan data and 
information to DOE for review in January of each year, so that DOE and 
the contractor can engage in fact-finding and discussions concerning 
the contractor's management approach and plans for its employee pension 
plans prior to the contractor's actuarial certification of the DB plan 
as required under the PPA. In an effort to improve planning and 
budgeting accuracy, contractor representatives also will discuss with 
DOE personnel, among other things, assumption elections, usage of 
credit balances, investment performance, and future year contribution 
estimates. Although actual contributions required by a contractor to 
fund a DB pension plan cannot be known prior to the start of the fiscal 
year, the Department has acquired modeling capabilities to estimate 
funding requirements and will work closely with the contractors to 
include accurate contribution estimates in future budget requests.
    Question. What is the fiscal year 2010 pension liability and how 
does that compare to what the Department budgeted for that fiscal year? 
How will that change in fiscal year 2011?
    Answer. Based on the information provided by the contractors during 
the annual pension management plan review, the Department anticipates 
fiscal year 2010 contributions by contractors to their DB pension plans 
of approximately $650 million. Although contractor contributions are an 
indirect cost allocated in accordance with the Cost Accounting 
Standards and are not broken out as line items in the fiscal year 2010 
budget request, these contributions are covered by the fiscal year 2010 
budget.
    For fiscal year 2011, the Department currently estimates these 
contributions will be approximately $1 billion, which is reflected in 
its fiscal year 2011 budget request. Actual contributions may change, 
as they are highly sensitive to underlying data, methods, assumptions, 
and capital market performance.
    Question. What are the impacts of higher pension liability on the 
amount of work performed by the contractors?
    Answer. The Department anticipates that contractor DB pension costs 
will continue to rise for the foreseeable future, some of which can be 
attributed to the current reimbursement action The Department's recent 
efforts to improve and strengthen its management and oversight of the 
contractor's management of its DB pension plan costs were motivated by 
the need for greater predictability and better control over costs, as 
well as to ensure that contractor DB pension costs do not impact 
performance of mission work. As a result of the Department's revised DB 
pension cost reimbursement action, as well as improved market factors 
and improved transparency, the Department anticipates that additional 
resources may in fact become available in fiscal year 2010 and fiscal 
year 2011 for performance of mission activities. However, as the 
additional resources that may become available to DOE in the short-term 
in fiscal year 2010 and fiscal year 2011 is due to the current 
reimbursement action, in the long term, it may come at the expense of 
the need for additional reimbursements in the future.
    That said, the Department anticipates facing rising contractor DB 
pension costs (due in part to the change in reimbursement action, and 
to the ever-increasing overall contractor employee compensation and 
benefits structure which includes pension benefits) for the foreseeable 
future and will continue to work closely with the contractor community 
to minimize any impact on mission work.
    Question. How does the Department propose to resolve this 
situation?
    Answer. The Department will continue to use the annual pension plan 
review process to assess this situation and will continue to engage 
with the contractors to mitigate any impacts, while continuing to meet 
contractual and statutory obligations to reimburse the costs of the 
contractor's DB pension plan.
    Question. As one of the largest research agencies in the Federal 
Government, DOE spends billions of dollars each year on publicly funded 
research.
    How is DOE using its labs to develop technologies to address the 
complex task of cleaning up decades of accumulated nuclear and 
hazardous wastes? Please provide some examples.
    Answer. The Office of Environmental Management (EM) directs the 
national laboratories, particularly those with close ties to EM sites 
such as the Savannah River National Laboratory (SRNL), the Pacific 
Northwest National Laboratory (PNNL), and the Oak Ridge National 
Laboratory (ORNL) to develop environmental cleanup technologies. The 
focus of our technology needs is primarily on Tank Waste. The reason EM 
is tasking the labs to do this is because we need transformational 
technologies to vastly reduce the life cycle cost and schedule of the 
tank waste system. Examples of technologies under development at the 
national laboratories include advanced glass formulations for increased 
radioactive waste loadings, an advanced cold crucible induction melter, 
and advanced chemical cleaning technologies for radioactive waste 
tanks.
    Question. To what extent are DOE sites using similar cleanup 
technologies, when possible, to help reduce development costs and 
increase cleanup efficiency?
    Answer. The Technology Development and Deployment program seeks, 
wherever possible, to develop technologies that can be used at multiple 
sites. Current projects with multiple site application include:
  --At-Tank/Near Tank Processing.--Use of at- or near-tank equipment 
        will allow solids and radionuclides to be removed, accelerating 
        processing rates and allowing early operations at both Hanford 
        and Savannah River Site (SRS).
  --Glass Optimization.--Improved glass formulations applicable to the 
        Hanford WTP and the SRS DWPF will allow a higher waste loading 
        and reduced life cycle costs.
  --Alternative Treatment/Disposal Processes.--A Fluidized Bed Steam 
        Reforming (FBSR) technology is being developed that could be 
        applied to waste streams at both Hanford and SRS.
  --Mixing/Blending Systems Optimization.--The use of lab and pilot 
        scale data to verify and calibrate Computational Fluid Dynamic 
        (CFD) or other types of numerical models will be used to 
        improve the modeling of Hanford and SRS tank waste mixing and 
        processing.
  --Integrated Systems Analysis.--To analyze alternatives to current 
        radioactive tank waste disposal technologies, EM has developed 
        a limited life-cycle model applicable to both the Hanford and 
        SRS tank wastes. The next steps will be for site-specific 
        process characteristics from current systems plans to be loaded 
        into the model and validation runs to be completed.
    Question. Why are three sites with tank waste--Savannah River, 
Hanford, and Idaho Falls--all using different technologies to treat 
their tank waste?
    Answer. The three sites do use different technologies due to the 
composition of the radioactive tank waste. Hanford produced large 
volumes of about 20 different types of waste. SRS, built a decade after 
Hanford, produced two main types of waste using the plutonium-uranium 
extraction (PUREX) process and the H-modified PUREX process.
    Another factor contributing to the use of different technologies 
are the waste tanks themselves. The Hanford and SRS tanks are 
constructed of carbon steel and cannot contain acid. Therefore the 
wastes were neutralized with caustic to produce an alkaline waste. The 
Idaho tanks were constructed with stainless steel and therefore the 
wastes were not neutralized with caustic. As the Idaho radioactive 
wastes were acidic, a different disposition approach, calcination, was 
appropriate.
    Question. Aside from the Recovery Act, the Department has 
unobligated balances in excess of $1 billion. What is DOE's policy 
regarding maintaining carryover balances? What is the rationale for 
such large unobligated balances? To what extent can these balances be 
used to offset the fiscal year 2011 budget request? Why should the 
subcommittee not require that all salaries and expenses appropriations 
be single-year, as they are in most other agencies?
    Answer. It is my intention to use departmental resources wisely. A 
key component of this effort is to use funds as intended by Congress 
and in as efficient and timely a manner as possible.
    Given the importance of minimizing unobligated balances, progress 
toward fully obligating each account is one of the key metrics 
evaluated during quarterly execution reviews. There are some instances 
where it is not prudent to obligate fully and therefore, establishing a 
blanket goal across the Department is unwise. Some examples of 
appropriate delays in obligations include: late passage of or 
anticipated delay in enacting annual appropriations; complex or 
specialized efforts for which it is difficult to find contractors; and 
programs that accumulate balances over several years before 
obligating--the Clean Coal Power Initiative, for example.
    When there are excess balances the Department's Chief Financial 
Officer and the programs work to address any impediments to carrying 
out approved activities. Where impediments to carrying out activities 
are identified, mitigation efforts are put in place. Where these are 
unsuccessful, or where the funds are no longer needed, unobligated 
balances may be identified as sources to pay for new activities. When 
this is possible, we propose this to Congress.
    In general, the Department has a good record of obligating funds. 
Over the last 5 years, the Department has obligated an average of 95 
percent of available funding by the end of each year. The small amount 
of unobligated balances is useful to help manage activities during 
Continuing Resolutions. I am confident the Department does not abuse 
the no-year availability of this funding and urge you to leave it no-
year money.
    Question. With the NP2010 ending this year, you have reorganized 
the Nuclear Energy budget.
    How would you characterize the changes you have made in the Office 
of Nuclear Energy in terms of projects that focus on applied science 
versus those that focus on basic science?
    Answer. The research budget of the Office of Nuclear Energy (NE) is 
directed toward attaining breakthroughs that would specifically support 
the advancement of nuclear power technologies, which we generally 
consider applied research. However, NE is also engaged with other 
offices, such as the Office of Science, in coordinating research that 
is at a more basic level. For example, NE is funding materials 
research, where the results could be used by the nuclear industry for 
future fuel cycle facilities, but also potentially by multiple 
industries.
    Question. What would you highlight in the Office of Nuclear Energy 
as your most important programs? How important is sustaining the 
current fleet of reactors, potentially for operation beyond 60 years, 
in terms of reducing greenhouse gas emissions?
    Answer. NE has established a broad research portfolio to support 
nuclear power in multiple ways. All of the programs are important to 
nuclear energy's future, though certainly different programs are more 
important with respect to specific objectives: extending the lifetime 
of the current fleet, enabling new builds, developing a sustainable 
fuel cycle, etc. Safely continuing operation of the current fleet of 
reactors, potentially beyond 60 years, helps avoid greenhouse gas 
emissions and as such would have an effect on the Nation's carbon 
emissions profile.
    Question. What is DOE doing to research the potential to keep these 
plants on the grid? Are you aware of any Energy Information Agency 
forecasting that include the current 104 reactors on grid through 2040?
    Answer. The Light Water Reactor Sustainability program is 
conducting research to investigate the possibility of extending the 
operating lifetime of current plants beyond 60 years. The program plans 
to look at a variety of issues, including materials aging and 
degradation, safety margin characterization, efficiency improvements, 
instrumentation and controls, and advanced fuels for light water 
reactors. The long-term EIA projections go out to 2035, so we are not 
aware of any forecasting that includes the current 104 reactors 
remaining on grid through 2040.
    Question. For the first time, DOE is proposing to work 
cooperatively with industry on small modular reactors. These are 
reactors that can be built in U.S. factories and shipped to plant 
sites. Can you explain why the Department is proposing this program at 
this time?
    Answer. DOE has engaged in discussion with small modular reactor 
(SMR) vendors, utilities, the Nuclear Regulatory Commission (NRC), 
Department of Defense, and other possible end-users of SMR energy. 
Through these discussions, we became convinced that there is potential 
in the small modular reactor concept. We will hold a workshop to gain 
further information about potential technical needs and industry 
challenges and from there the administration evaluate potential 
priorities in the context of the appropriate Federal role to identify 
the most cost effective, efficient, and appropriate mechanisms to 
support further development.
    Question. The budget increases the Fuel Cycle Research and 
Development Account by $65 million. Could you please tell the Committee 
what activities you are planning for 2011?
    Answer. The Fuel Cycle Research and Development program is 
continuing the shift begun in fiscal year 2010 from a near-term 
technology development and deployment program to a long-term, results-
oriented, science-based R&D program. We intend to expand the scope of 
the program in two areas in fiscal year 2011, which accounts for the 
increased funding request: (1) Used Nuclear Fuel Disposition R&D and 
(2) Modified Open Cycle R&D.
    The Used Nuclear Fuel Disposition R&D technical area is being 
increased from $9 million to $45 million to continue and expand R&D 
related to storage, transportation, and disposal options for used 
nuclear fuel and high-level waste. Much of the work in these areas was 
previously within the scope of the Office of Civilian Radioactive Waste 
Management. In addition, as necessary, these funds will also be used to 
respond to technical inquiries from the Blue Ribbon Commission.
    The Modified Open Cycle R&D program has been established as a new 
technical area in the program in fiscal year 2011. It is important to 
examine the full range of fuel cycle strategies in order to provide 
future decisionmakers with adequate information to make decisions on 
how best to manage used nuclear fuel. The modified open fuel cycle has 
not been studied as thoroughly as the once-through fuel cycle and full 
recycle fuel cycle options. The modified open fuel cycle is a strategy 
that is ``modified'' in that some limited separations and fuel 
processing technologies are applied to the used light water reactor 
fuel to create fuels that enable the extraction of potentially much 
more energy from the same mass of material and accomplish waste 
management and nonproliferation goals. There are many technical 
challenges and unanswered questions associated with this option. The 
program will investigate priority issues related to fuel forms, 
reactors, and fuel/waste management approaches.
    Question. Could you please describe how you fund, monitor, and 
enforce compliance issues within the Energy Star Program?
    Answer. For fiscal year 2010, EERE is using American Reinvestment 
and Recovery Act (Recovery Act) funds for verification testing of 
ENERGY STAR products in support of the Recovery Act-funded Appliance 
Rebate Program (SEEARP). If models fail to meet ENERGY STAR program 
requirements, States are being notified and, at their discretion, can 
remove those models from their rebate eligibility lists. Also, if a 
model does not meet requirements, EERE notifies the Environmental 
Protection Agency who will take ENERGY STAR enforcement action with 
the manufacturer and, in most cases, would disqualify the product from 
the program's qualified product list. In the event testing shows the 
product also does not meet minimum energy efficiency standards, the 
Department of Energy will begin enforcement actions to insure the 
product is not sold illegally in the market. The 2009 MOU was written 
with the intent EPA will handle matters pertaining to ENERGY STAR 
enforcement while DOE would continue to handle any minimum standards 
violations.
    In fiscal year 2011, the Department will expand the categories of 
ENERGY STAR products to be tested, along with supporting EPA's managed 
market-based verification program. DOE continues to request 
appropriated funds for work supported by DOE.
    Question. How many staff does the Department employ for ENERGY 
STAR compliance, monitoring, and enforcement, and are there any 
specific plans to increase this capacity in fiscal year 2011?
    Answer. In fiscal year 2010, the Department is using 2.0 Full Time 
Equivalent (FTE) for ENERGY STAR verification testing, compliance and 
monitoring, and program transition functions. Based on DOE verification 
testing, EPA is handling the enforcement portion of the program. In the 
event testing shows the product also does not meet minimum energy 
efficiency standards, the Department of Energy will begin enforcement 
actions to insure the product is not sold illegally in the market. The 
2009 MOU was written with the intent EPA will handle matters pertaining 
to ENERGY STAR enforcement while DOE would continue to handle any 
minimum standards violations. In addition, 1.0 FTE has been used to 
support the State Energy Efficiency Appliance Rebate Program. In fiscal 
year 2011, the Department anticipates increasing staff support to 3.0 
FTE in order to increase its testing, compliance and monitoring 
functions, to begin developing/revising test procedures for the program 
and to provide technical analyses for EPA's program requirements' 
development and revision. The State rebate program will be winding down 
and only require 0.25 FTE in fiscal year 2011.
    Question. DOE staff has briefed congressional staff on transferring 
the promotion of several ENERGY STAR products to the EPA, such as 
windows, refrigerators, dishwashers and compact fluorescent lights, 
within the fiscal year 2011 budget request. However, the budget still 
references these products as part of the DOE.
    Is it the administration's intent to transfer the promotion of 
ENERGY STAR labels for these appliances from the Energy Department to 
the EPA? Please describe the funding, rationale, and implementation 
schedule anticipated for this transfer, if it is undertaken.
    Could you please describe how the DOE intends to release more than 
20 final appliance rules by June 30, 2011 and whether the amount of 
funding requested in the budget is adequate to ensure that these final 
rules are issued by the deadline.
    Could you please break-down funding for the various components of 
the ENERGY STAR Program for fiscal year 2011?
    Answer. In order to improve the efficiency of the ENERGY STAR 
Program based on the capabilities of the two agencies, the agencies 
agreed to new roles managing this program. The Environmental Protection 
Agency will now take on one set of responsibilities across all ENERGY 
STAR product categories. This includes both program requirements 
establishment, or revision, and the promotion of these products. DOE 
will take on the roles of testing procedure development and product 
testing where appropriate. This transition is currently taking place 
and will be completed during fiscal year 2010. In fiscal year 2011, the 
DOE proposes to fund the development or revision of test procedures for 
ENERGY STAR, testing and verification of products, and providing 
technical support to EPA as described in the September 30, 2009 
Memorandum of Understanding signed by the two agencies. For fiscal year 
2011, the Department requested $10 million for ENERGY STAR Program 
activities of which $5 million will be focused on test procedure 
development and revision, $4 million for testing and verification, and 
$1 million for analyses and technical support to EPA.
    DOE established detailed schedules for development and issuance of 
all rulemakings governed by the Consent Decree or statutory deadlines, 
and is putting in place the staff, internal processes and other 
resources necessary to ensure that these deadlines are achieved. For 
fiscal year 2010, the Department requested and received $35 million to 
support implementation of the appliance standards programs. For fiscal 
year 2011, the Department requests $40 million for these efforts. This 
funding is adequate to enable DOE to meet the established deadlines and 
to undertake new efforts to improve compliance and enforcement. part of 
that money will go to the enforcement of minimum appliance standards 
that DOE promulgates. While we will report and share data with ENERGY 
STAR, the Appliance Standards program is not responsible for enforcing 
ENERGY STAR efficiency levels.
    Question. The Next Generation Lighting Initiative will provide 
significant energy savings though more efficient lighting. Given the 
DOE's management in the development and understanding of this new 
technology, could you please describe how DOE will oversee this 
initiative, as well as other activities related to the initiative?
    Answer. The Department of Energy (DOE) has taken a comprehensive 
approach to overseeing the Next Generation Lighting Initiative, a part 
of the Energy Policy Act of 2005. This approach covers a balance of 
engineering and science in R&D, and market-based programs. Elements 
include Core Technology (applied research), Product Development, 
Manufacturing R&D, Commercialization Support, and SSL Partnership (with 
the Next Generation Lighting Industry Alliance). Over 70 active R&D 
projects address the key science and engineering challenges. Workshops 
are held each year to keep the program focused on the priority R&D 
challenges. All R&D projects are competitively-awarded and cost-shared. 
A collection of Commercialization Support programs, such as CALiPER, 
GATEWAY and Standards development, provide information and direction to 
market players, and link back into the R&D program for further 
improvements. The commercialization support programs have over 150 
partners involved. The program has produced performance achievements in 
efficacy each year, moving the market/technology upward in efficiency.
                                 ______
                                 
              Questions Submitted by Senator Thad Cochran
    Question. Mr. Secretary, I have been waiting for a year for a 
report on the Strategic Petroleum Reserve, specifically on the 
Mississippi site for expansion, and I have yet to receive any word from 
the Department. Why? I brought this up at last year's hearing because 
funding for the project remained contingent on the issuance of the 
report. What is the status?
    Answer. The Omnibus Appropriations Act, 2009 (Public Law 111-8), 
enacted March 11, 2009, requires ``. . . That none of the funds 
provided for the new site expansion activities may be obligated or 
expended for authorized activities until the Secretary of Energy has 
submitted a Report to the Congress on the effects of expansion of the 
Reserve on the domestic petroleum market.'' DOE has prepared the report 
and it is under review.
    Question. What is the status of DOE-funded nuclear energy workforce 
training and education programs? Are we going to have enough people 
trained to work at nuclear plants and at DOE facilities in the next 10 
years?
    Answer. In 2011 the Department will implement RE-ENERGYSE 
(Regaining our Energy Science and Engineering Edge), which will enable 
education and inspire students to pursue careers in science, 
engineering, and entrepreneurship related to clean energy. This new 
effort will provide important support to bolster nuclear engineering 
and science programs at U.S. universities and will be an effective and 
appropriate means of providing educational support.
    The existing program within NE that provides scholarships and 
fellowships will be terminated at the end of fiscal year 2010. This 
existing program--the Integrated University Program (IUP) will provide 
$5 million to fund 88 scholarships and 30 fellowships to be awarded in 
the summer of 2010. In fiscal year 2011, NE will fund these activities 
at the same level through the RE-ENERGYSE initiative.
    Question. I am concerned about the utility ratepayers of 
Mississippi who have contributed to the nuclear waste fund. What is the 
justification for continuing to collect these funds from Mississippi 
when DOE has now decided to terminate the national repository program? 
Mr. Secretary, I believe it would make better public policy to suspend 
collections until Congress determines future funding needs and funding 
methods when it enacts a new program based on the Blue Ribbon 
Commission's recommendations. I would like to work with your staff on 
this issue.
    Answer. The administration is fully committed to meeting the 
responsibilities for the safe storage and management of spent nuclear 
fuel and nuclear waste. The fees collected from the nuclear industry 
are legally mandated and reviewed every year and will pay the cost of 
the long-term disposition of the materials. The Blue Ribbon Commission 
has been charged with making recommendations on these issues, including 
how the fees should be handled moving forward.
    Question. On the subject of terminating the national repository 
program, Mr. Secretary, what steps are you taking to appropriately 
retain the data gained from the billions of dollars invested in 
research on the repository?
    Answer. The Department is committed to preserving the scientific 
knowledge developed through the Yucca Mountain project. Records 
generated by the OCRWM program in the course of activities at Yucca 
Mountain are managed and archived in accordance with the requirements 
of the Federal Records Act and related regulations. Paper and 
electronic media records that have been archived are stored at several 
National Archives and Records Administration Federal Records Centers 
(FRC) under FRC regulations, as well as in a DOE-leased facility in Las 
Vegas. In addition to records on paper and electronic media, images of 
records are electronically maintained in our Records Information System 
and the DOE's documentary material is electronically available to the 
public on the Licensing Support Network.
    Question. Mr. Secretary, in speaking with my colleagues today, you 
mentioned salt domes as possible nuclear waste storage sites. Could you 
please tell me which salt domes the Department is looking at for this 
purpose, and could you give more information about this idea?
    Answer. The Department is not currently studying any specific site 
as a replacement for Yucca Mountain, nor is DOE considering any 
specific salt dome as a possible nuclear waste storage site.
    Question. I understand the DOE is proposing $3 million for 
international nuclear energy cooperation. Can you please explain this 
program to the subcommittee?
    Answer. The INEC budget request of $3 million will be used to 
provide advice and support to Office of Nuclear Energy (NE) programs in 
implementing international cooperative research and development (R&D) 
activities. The R&D is the responsibility of other NE programs, not 
INEC. INEC would also work with other NE programs, other Department 
offices, and other agencies on implementing new agreements having 
civilian nuclear energy aspects. Some of the funding will focus on 
bilateral and multilateral agreements and implementing arrangements to 
carry out cooperative technical R&D-based activities with countries 
including Argentina, Brazil, China, India, Kazakhstan, and the Republic 
of South Africa and possibly other countries as U.S. international 
policy is developed. Typically, before international collaborative work 
is initiated, DOE works closely with other domestic agencies, such as 
the Department of State, to convene experts-level meetings with foreign 
counterparts to discuss the policy, technical and legal parameters of 
cooperation. Once these are established, assessments of capabilities 
and technology requirements are typically conducted to identify the 
most mutually beneficial areas of cooperation. It is in these initial 
steps of laying the foundation for cooperation that much of the INEC 
budget request would be applied.
    NE collaborates on a bilateral and multilateral basis with a wide 
array of countries including Japan, Russia, the Republic of Korea, 
France, Ukraine, and others, but the implementing arrangements for 
cooperation with these countries are already in place. In such cases, 
policy and technical support from NE's Office of International Nuclear 
Energy Policy is less intensive.
    Examples of potential areas of international civilian nuclear 
energy collaboration that NE programs would engage in include, but are 
not limited to: research, development, testing, and evaluation of 
advanced nuclear reactor systems; advanced nuclear fuel and material 
irradiation and use of experimental facilities; technical expert 
exchange programs to share best practices at civilian nuclear power 
plants; small and medium-sized reactor development; reactor life 
sustainability; probabilistic safety assessments and risk analyses for 
operating reactors; improvements in reactor fuel burn-up efficiencies; 
and, together with other global partners, the exploration of ways to 
enhance the international framework for civil nuclear cooperation so 
that countries can access nuclear power for peaceful purposes while 
minimizing the risks of proliferation.
    Question. Congress appropriated funds in the Recovery Act 
specifically for pilot and demonstration scale biofuels projects. In my 
home State of Mississippi, we have a company that is ready to start 
building a biorefinery capable of producing close to 18 million gallons 
of biofuel per year. This project is shovel-ready and will create green 
jobs in our State. It is our understanding that several of these 
projects are currently being evaluated by the Loan Guarantee Program. 
Can you give us a sense of what the timing is on issuing loan 
guarantees for biofuels projects?
    Answer. The Departments' Biomass Program and Loan Programs work in 
conjunction to support the development of cellulosic ethanol from 
research and development, demonstration and piloting, and finally, full 
commercial scale-up. In 2009, the Department's Biomass Program 
committed over $610 million in Recovery Act funds to increase 
investments in integrated biorefineries at the pilot and demonstration 
scale as well as for biofuels infrastructure activities. This Recovery 
Act funding is in addition to the over half of a billion dollars of DOE 
investments in integrated biorefinery projects from fiscal years 2007 
through 2010. The purpose of DOE's investments in pilot, demonstration, 
and small commercial scale biorefineries is to generate techno-economic 
data from their operations in order to validate full commercial-scale 
readiness. Once a technology has been proven in the pilot and 
demonstration phase, it may be eligible for a DOE loan guarantee to 
support the project's full commercial scale up. Under the Recovery Act 
funding for the Loan Guarantee Program, all biofuel projects must 
represent advanced technologies.
    The Loan Guarantee Program is working closely with the Renewable 
Fuels Association to facilitate dialogue with biofuels companies. As a 
result of this collaboration, on April 7, 2010, the Loan Guarantee 
Program held a roundtable discussion with members of the biomass 
community to discuss issues that the industry faces in obtaining loan 
guarantees.
    Question. President Obama reiterated his support for biofuel 
development in May 2009 and again on February 3 of this year. Are there 
any issues that are holding up approval of these biofuels projects? Are 
these projects a priority for DOE?
    Answer. Bioproduct projects present some unique challenges. Many 
are capital intensive, provide a commodity product, and have no off-
take agreements. The Loan Guarantee Program is working closely with the 
Renewable Fuels Association to facilitate dialogue with the biofuels 
companies. As a result of this collaboration, on April 7, 2010, the 
Loan Guarantee Program held a roundtable discussion with members of the 
biomass community to discuss issues that the industry faces in 
obtaining loan guarantees.
    Question. In the 2007 energy bill we set a renewable fuels standard 
that requires 36 billion gallons of renewable fuel by 2022. How does 
DOE envision achieving this goal?
    Answer. Achieving the Renewable Fuel Standard (RFS) requires the 
creation of a new industry that will produce a high volume of liquid 
transportation fuels that are cost competitive with petroleum fuels. 
Several factors have led to unanticipated reductions in the near-term 
pace of growth of the cellulosic biofuels industry, including the 
economic recession, oil price drops, and the reduction of credit 
available to investors who wish to invest in these technologies.
    The Department of Energy (DOE) believes the United States must 
accelerate renewable fuels production to meet the RFS requirement of 36 
billion gallons. The key to such a large-scale transition and meeting 
the RFS targets is to make cellulosic biofuels and other advanced 
biofuels cost competitive with corn-based ethanol and gasoline. That is 
why the DOE is performing fundamental research on next-generation 
bioenergy crops to provide the transformational breakthroughs that can 
contribute toward more efficient cellulosic ethanol production and 
development of other advanced biofuels. Additionally, DOE has a robust 
applied R&D and deployment program focused on driving down the costs of 
key components of producing advanced biofuels through both biochemical 
and thermochemical pathways. DOE also works to establish a sufficient 
and sustainable supply of bioenergy feedstocks and cost-effective 
systems for harvest and transport of feedstocks to biorefineries. 
Moreover, DOE is cost sharing a total of 27 biorefinery projects with 
industrial partners at the pilot, demonstration, and commercial scales, 
all of which focus on cellulosic or other non-food feedstocks to 
produce advanced biofuels in support of the RFS. DOE has developed 
public-private partnerships to reduce the risk of deploying first-of-a-
kind cellulosic biorefineries to produce biofuels. The Energy 
Information Agency's Annual Energy Outlook 2010's reference case 
scenario projects that biofuels will account for most of the projected 
growth in liquid fuels consumption, reaching 26 billion gallons in 
2022.\1\
---------------------------------------------------------------------------
    \1\ ``EIA's Long-Term Biofuels Outlook'' EIA Presentation, 2010 
Energy Conference, April 6, 2010 http://www.eia.doe.gov/conference/
2010/session2/gross.pdf.
---------------------------------------------------------------------------
                                 ______
                                 
           Questions Submitted by Senator George V. Voinovich
    Question. The DOE Office of Nuclear Energy budget lists a new 
program for Reactor Concepts R&D in the amount of $195 million. The 
Reactor Concepts R&D request carries on activities for a variety of 
previously appropriated activities, and includes a new program for 
Small Modular Reactors (SMRs) in the amount of $38.9 million. Given 
recent strong commercial interest in the new reactor technologies 
funded by Reactor Concepts R&D, there is a need for adequate, dedicated 
funding for cost-sharing of the development of Small Modular Reactors 
by public/private partnerships to reduce financial uncertainty. The 
cost-sharing amount needed to support two small light-water-reactor 
designs has been estimated to be not less than $35 million. This means 
that additional funds of about $20 million are needed to support 
research for the SMRs. How is DOE ensuring that adequate cost-sharing 
funds and research funds are available for small light water modular 
reactors, and how is DOE ensuring that this cost-sharing information is 
publically known and available so that the private sector will have 
certainty in investing?
    Answer. DOE has engaged in discussion with small modular reactor 
(SMR) vendors, utilities, the Nuclear Regulatory Commission (NRC), 
Department of Defense, and other possible end-users of SMR energy. 
Through these discussions, we became convinced that there is potential 
in the small modular reactor concept and have requested an appropriate 
amount of funding for SMR activities in the fiscal year 2011 budget. 
DOE will hold a workshop on SMRs in June 2010 to obtain information 
from vendors and suppliers, potential utility customers, national 
laboratories, universities, NRC, and interested stakeholders on 
priorities, activities and projects that will inform our strategy. As 
noted in the budget, the administration will evaluate potential 
priorities in the context of the appropriate Federal role to identify 
the most cost-effective, efficient, and appropriate mechanisms to 
support further development. Any cost-sharing within the SMR program 
will be based on a competitive award process. We believe that both the 
DOE cost-share award process and NRC licensing process will help ensure 
that information gained through this program is made available to 
others to the greatest degree possible.
    Question. The Clean Energy Park concept builds upon a DOE 
initiative to reindustrialize and transform former weapons complex 
sites into clean energy production centers. Through this approach, the 
local communities, States and regions that supported our Nation's 
defense mission for so long will benefit from the sustainable economic 
development opportunities of such large-scale commercial projects. As 
you are aware the Southern Ohio Clean Energy Park Alliance (SOCEPA) has 
held several meetings with officials in the Department over the past 
year regarding their shared interest with the Department in creating a 
Clean Energy Park initiative. This project would provide a unique 
opportunity for the Department to support many of the missions of its 
own internal offices in a cross-cutting nature, including carbon 
footprint reduction of the Nation's electric generation, asset 
reutilization and re-industrialization of former weapons complex sites, 
and support for deployment of electric generation that relies on low 
carbon and zero carbon technologies.
    While the Department has voiced support for the concept, it is not 
clear how DOE is progressing in developing it. Examples of program 
developments could be formation of a program office within DOE 
including funding, identification and policies for coordination of 
issues across departments, and policies for organizations to use in 
developing sites and local support.
    What is the Department doing to develop this concept?
    Answer. In early 2009, representatives from the Office of 
Environmental Management (EM) discussed EM's ``footprint reduction'' 
initiatives for several Department of Energy (DOE) sites and the 
potential future use of land with regional stakeholders and local 
communities. However, the administration is focusing Environmental 
Management activities on its core cleanup mission, which continue to 
experience project management, technical, and regulatory challenges. 
Completing remediation of these sites on cost and schedule is the most 
effective way for the Department to support local officials, 
businesses, and others in these communities with their economic 
development plans.
    Question. Is there any legislation that is needed?
    Answer. The administration is not proposing or requesting any 
legislation.
    Question. I am concerned that the regulatory and technical 
infrastructure, as well as the industrial base in manufacturing and 
fabrication technologies may not be ready to support the development of 
new and innovative reactors. This includes cross-cutting technologies 
for identification, development, demonstration and qualification of 
advanced manufacturing and construction techniques, modern codes and 
standards, supply chain development, and qualification, and training of 
people. How is DOE ensuring that adequate resources have been set aside 
to ensure that this infrastructure continues to develop and will be in 
place in a timely manner?
    Answer. In general the private sector is expected to respond and 
accommodate the manufacturing and construction needs as industry 
decides to move forward and build new reactors. The Department's recent 
loan guarantee announcement has sent a strong signal to the private 
sector that nuclear needs to be part of our energy mix, and we expect 
the private sector to continue to make adjustments in order to build 
new reactors. We are also working, through programs such as RE-
ENERGYSE, to train the next generation of nuclear engineers and 
scientists. And, the Department will participate in codes and standards 
activities as appropriate..
    Question. I would like to commend you for DOE's recent announcement 
to provide a $45 million cost share for further development and 
demonstration of the American Centrifuge Plant (ACP) in Piketon, Ohio. 
Your decision is a strong commitment by the Department to this 
important technology.
    However, I am concerned about your response to Senator Bennett's 
question during the Energy and Water hearing regarding when DOE will 
close on the loan guarantee application by Areva for their proposed 
enrichment facility. The premise in your response ``We are closing on 
it as quickly as possible'' implies that Areva will receive a loan 
guarantee without United States Enrichment Corporation (USEC) having 
the opportunity to update their previous application for the loan 
guarantee.
    I urge you to ensure that the USEC technology is not precluded in 
the consideration for a loan guarantee. As you know, USEC has been 
working to address the technical and financial concerns that were 
raised last summer by the DOE loan guarantee program. USEC has 
indicated that they have made significant technical progress in 
demonstrating the reliability and the high quality manufacturability of 
the centrifuge machines to support certainty in the cost and 
performance needed for a commercial plant. DOE's commitment to 
providing $45 million in demonstration and development funding has 
enhanced USEC's ability to demonstrate the technical requirements 
needed for the loan guarantee program. Financially, USEC has disclosed 
that they are exploring strategic alternatives to raise additional 
capital for the American Centrifuge project, and that assurances for a 
clear path forward for a loan guarantee would be important to their 
ability to obtain third-party financing.
    From a timing standpoint, USEC appears to be nearing the final 
stages of meeting their obligations for a loan guarantee. The ACP is 
``shovel ready'' and has the potential to quickly create about 8,000 
good American jobs in numerous States. The Areva project is not as 
mature and will take several years before we would see this kind of job 
growth, assuming the project is successful. As we have discussed 
before, funding of this centrifuge technology is essential to U.S. job 
growth and the future of clean, abundant energy in the United States.
    If DOE is, in fact, nearing a decision on the Areva technology, I 
urge you as strongly as possible to also provide a clear path forward 
for ensuring loan guarantee funding is also available for the American 
Centrifuge Plant. A failure to do so, I fear, would lead to further job 
loss and ultimately jeopardizing the success of this project so crucial 
to our energy and national security needs. I request that you support 
USEC's commitment to fulfilling the requirements for a loan guarantee 
and do not shut the door on this vital project. Specifically, will DOE 
have additional loan guarantee funds available for both the Areva and 
the USEC ACP, and what legislative authority and appropriations does 
DOE need to support this?
    Answer. In response to a June 30, 2008 solicitation for Federal 
loan guarantees supporting Front End Nuclear Facilities, the Department 
received two applications for Federal loan guarantees to support two 
different front-end nuclear facility projects. In total, the two 
applicants requested DOE to provide loan guarantees in excess of the $2 
billion available authority.
    On March 25, 2010, the Department sent a reprogramming request to 
the appropriate Congressional Committees notifying them of DOE's 
intention to use up to $2 billion of the fiscal year 2007 Authority, 
made available to the Department under the Revised Continuing 
Appropriations Resolution, 2007, for front end nuclear fuel facilities. 
The balance of the fiscal year 2007 Authority will remain available for 
loan guarantees for eligible project applicants under the 2006 
Solicitation for fossil, energy efficiency and renewable energy systems 
projects that employ innovative technologies.

                          SUBCOMMITTEE RECESS

    Senator Tester. I wish you all the best, Secretary Chu.
    And this subcommittee hearing is recessed.
    [Whereupon, at 12 noon, Thursday, March 4, the subcommittee 
was recessed, to reconvene subject to the call of the Chair.]
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