[House Hearing, 112 Congress]
[From the U.S. Government Publishing Office]







                           AN OVERVIEW OF THE
                          DEPARTMENT OF ENERGY
                    RESEARCH AND DEVELOPMENT BUDGET
                          FOR FISCAL YEAR 2013

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

                                HEARING

                               BEFORE THE

              COMMITTEE ON SCIENCE, SPACE, AND TECHNOLOGY
                        HOUSE OF REPRESENTATIVES

                      ONE HUNDRED TWELFTH CONGRESS

                             SECOND SESSION

                               __________

                        THURSDAY, MARCH 1, 2012

                               __________

                           Serial No. 112-65

                               __________

 Printed for the use of the Committee on Science, Space, and Technology






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              COMMITTEE ON SCIENCE, SPACE, AND TECHNOLOGY

                    HON. RALPH M. HALL, Texas, Chair
F. JAMES SENSENBRENNER, JR.,         EDDIE BERNICE JOHNSON, Texas
    Wisconsin                        JERRY F. COSTELLO, Illinois
LAMAR S. SMITH, Texas                LYNN C. WOOLSEY, California
DANA ROHRABACHER, California         ZOE LOFGREN, California
ROSCOE G. BARTLETT, Maryland         BRAD MILLER, North Carolina
FRANK D. LUCAS, Oklahoma             DANIEL LIPINSKI, Illinois
JUDY BIGGERT, Illinois               DONNA F. EDWARDS, Maryland
W. TODD AKIN, Missouri               MARCIA L. FUDGE, Ohio
RANDY NEUGEBAUER, Texas              BEN R. LUJAN, New Mexico
MICHAEL T. McCAUL, Texas             PAUL D. TONKO, New York
PAUL C. BROUN, Georgia               JERRY McNERNEY, California
SANDY ADAMS, Florida                 JOHN P. SARBANES, Maryland
BENJAMIN QUAYLE, Arizona             TERRI A. SEWELL, Alabama
CHARLES J. ``CHUCK'' FLEISCHMANN,    FREDERICA S. WILSON, Florida
    Tennessee                        HANSEN CLARKE, Michigan
E. SCOTT RIGELL, Virginia            SUZANNE BONAMICI, Oregon
STEVEN M. PALAZZO, Mississippi       VACANCY
MO BROOKS, Alabama
ANDY HARRIS, Maryland
RANDY HULTGREN, Illinois
CHIP CRAVAACK, Minnesota
LARRY BUCSHON, Indiana
DAN BENISHEK, Michigan
VACANCY


















                            C O N T E N T S

                            Date of Hearing

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

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

                           Opening Statements

Statement by Representative Ralph M. Hall, Chairman, Committee on 
  Science, Space, and Technology, U.S. House of Representatives..    13
    Written Statement............................................    14

Statement by Representative Eddie Bernice Johnson, Ranking 
  Minority Member, Committee on Science, Space, and Technology, 
  U.S. House of Representatives..................................    15
    Written Statement............................................    16

                               Witnesses:

Dr. Steven Chu, U.S. Secretary of Energy
    Oral Statement...............................................    18
    Written Statement............................................    19

Discussion.......................................................    22

             Appendix 1: Answers to Post-Hearing Questions

Dr. Steven Chu, U.S. Secretary of Energy.........................    52

             Appendix 2: Additional Material for the Record

Analysis of Impacts of a Clean Energy Standard as Requested by 
  Chairman Bingaman, November 2011...............................   123

Charts Submitted by Representative Rohrabacher...................   155
                                                                       

 
                           AN OVERVIEW OF THE
                          DEPARTMENT OF ENERGY
                    RESEARCH AND DEVELOPMENT BUDGET
                          FOR FISCAL YEAR 2013

                              ----------                              


                        THURSDAY, MARCH 1, 2012

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

    The Committee met, pursuant to call, at 9:36 a.m., in Room 
2318 of the Rayburn House Office Building, Hon. Ralph Hall 
[Chairman of the Committee] presiding.


[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


    Chairman Hall. Okay. The Committee on Science, Space, and 
Technology will come to order. And I say good morning and 
welcome to today's hearing entitled ``An Overview of the 
Department of Energy Research and Development Budget for Fiscal 
Year 2013.'' In front of all of us here are packets containing 
the written testimony, biography, and Truth-in-Testimony 
disclosure for today's witness, the Secretary of Department of 
Energy, Dr. Steven Chu. And we are honored of course to have 
you, sir.
    I want to welcome everyone here today for the hearing on 
the President's fiscal year 2013 budget request for the 
Department of Energy, and in particular I want to extend a warm 
welcome to you, Mr. Secretary, for appearing before the 
Committee yet again this year. We may occasionally have strong 
disagreements, but we thank you for your service and for your 
willingness to appear before this Committee.
    This is the President's fourth budget submission in 
Congress, so its general priorities, and my concerns with them, 
should come as no surprise. As in the years past, the budget 
calls for massive increases in green energy programs while 
flat-lining or cutting programs devoted to basic research and 
the advancement of the domestic production of reliable and 
affordable sources of energy, such as oil, natural gas, coal, 
and nuclear. The lack of balance in this approach is 
disappointing, and I hope and expect that Congress is going to 
reject it.
    Last year, I used a gambling term to highlight my concern 
with the President's budget, specifically the extent to which 
President Obama ``doubled-down'' on his energy and climate 
agenda in light of the continued struggling economy, trillion-
dollar deficits, rising gas prices, and fuel supply concerns 
driven by Middle East turmoil. All of these issues remain 
today, and some, such as the price of gas, have been further 
exacerbated. After a year in which American taxpayers saw their 
money wasted in high-profile failures of government-backed, so-
called clean energy companies, it is surprising that DOE now 
uses that same term, ``double-down,'' to describe the 
Department's budget proposal. In this context, I think I can at 
least understand the Administration's use of a gambling 
metaphor to describe its plans for risking taxpayer dollars.
    Last year, the centerpiece of the President's energy policy 
proposal to Congress was enactment of a Clean Energy Standard 
to mandate the purchase of certain types of ``clean'' 
electricity. At the time the President announced it, the cost 
of his proposal was not clear, so I asked DOE's Energy 
Information Administration to calculate projected costs under 
various scenarios. The best estimate scenario found that 
nationwide electricity prices would increase almost 30 percent 
by 2035, and gross domestic product would be reduced by 
approximately $100 billion annually. A comparable analysis 
requested by the Senate yielded similar results.
    In light of the data from DOE, the President continues to 
push for a mandate that Americans purchase more expensive 
electricity, while other countries seek to make energy cheaper 
for their citizens. This is especially disappointing and should 
again be soundly rejected by Congress, as was the previous 
proposal to increase the cost of energy through a cap-and-trade 
scheme. Meanwhile, gasoline prices approach record highs, 
placing additional energy costs on consumers, causing pain not 
only at the pump but also in every other sector of the American 
economy that depends upon affordable fuel to deliver goods and 
services.
    In response, the President ironically calls for an ``all-
of-the-above'' energy strategy but continues to propose 
policies that in reality show his lack of concern with gasoline 
prices. His Administration continues to actively take steps 
that place upward pressure on oil prices. He delayed offshore 
drilling permits and blocked production of the Outer 
Continental Shelf and the Alaska National Wildlife Refuge. He 
thwarted construction of the Keystone Pipeline. He proposed 
through EPA and other agencies costly new regulations. And he 
proposed eliminating or cutting R&D programs aimed at advancing 
domestic production and supply of oil and natural gas 
resources.
    Had the President moved forward with the ``all-of-the-
above'' energy policies, he would understand that producing 
America's natural resources makes a difference--just as 
American ingenuity makes a difference. It may take the American 
public to convince the President to approve the pipeline and 
expand domestic production. I hope today's hearing provides an 
opportunity to address these topics further.
    I now recognize Ranking Member Ms. Johnson for her 
statement.
    [The prepared statement of Mr. Hall follows:]

              Prepared Statement of Chairman Ralph M. Hall

    I want to welcome everyone here today for this hearing on the 
President's Fiscal Year 2013 budget request for the Department of 
Energy, and in particular I want to extend a warm welcome to Secretary 
Chu for appearing before the Committee yet again this year. We may 
occasionally have strong disagreements, but we thank you for your 
service and your willingness to appear before this Committee.
    This is the President's fourth budget submission to Congress, so 
its general priorities--and my concerns with them--should come as no 
surprise. As in years past, the budget calls for massive increases in 
green energy programs while flat-lining or cutting programs devoted to 
basic research and the advancement of the domestic production of 
reliable and affordable sources of energy, such as oil, natural gas, 
coal, and nuclear. The lack of balance in this approach is 
disappointing, and I hope and expect Congress will reject it.
    Last year I used a gambling term to highlight my concern with the 
President's budget, specifically the extent to which President Obama 
``doubled-down'' on his energy and climate agenda in light of the 
continued struggling economy, trillion-dollar deficits, rising gas 
prices, and fuel supply concerns driven by Middle East turmoil. All of 
those issues remain today, and some--such as the price of gas--have 
been further exacerbated. After a year in which American taxpayers saw 
their money wasted in high-profile failures of government-backed, so-
called clean energy companies, it is surprising that DOE now uses that 
same term, ``double-down,'' to describe the Department's budget 
proposal. In this context, I think I can at least understand the 
Administration's use of a gambling metaphor to describe its plans for 
risking taxpayer dollars.
    Last year, the centerpiece of the President's energy policy 
proposal to Congress was enactment of a Clean Energy Standard to 
mandate the purchase of certain types of ``clean'' electricity. At the 
time the President announced it, the cost of his proposal was not 
clear, so I asked DOE's Energy Information Administration to calculate 
projected costs under various scenarios. The best estimate scenario 
found that nationwide electricity prices would increase almost 30% by 
2035, and gross domestic product would be reduced by approximately $100 
billion annually. A comparable analysis requested by the Senate yielded 
similar results.
    In light of this data from DOE, the President continues to push for 
a mandate that Americans purchase more expensive electricity, while 
other countries seek to make energy cheaper for their citizens. This is 
especially disappointing and should again be soundly rejected by 
Congress, as was his previous proposal to increase the cost of energy 
through a cap-and-trade scheme.
    Meanwhile, gasoline prices approach record highs, placing 
additional energy costs on consumers, causing pain not only at the pump 
but also in every other sector of the American economy that depends 
upon affordable fuel to deliver goods and services. In response, the 
President ironically calls for an ``all-of-the-above'' energy strategy 
but continues to propose policies that in reality show his lack of 
concern with gasoline prices. His Administration continues to actively 
take steps that place upward pressure on prices. He delayed offshore 
drilling permits and blocked production in the Outer Continental Shelf 
and the Alaska National Wildlife Refuge. He thwarted construction of 
the Keystone Pipeline. He proposed through EPA and other agencies 
costly new regulations. And he proposed eliminating or cutting R&D 
programs aimed at advancing domestic production and supply of oil and 
natural gas resources.
    Had the President moved forward with ``all-of-the-above'' energy 
policies, he would understand that producing America's God-given 
natural resources makes a difference--just as American ingenuity makes 
a difference. It may take the American public to convince the President 
to approve the pipeline and expand domestic production. I hope today's 
hearing provides an opportunity to address these topics further.
    I now recognize Ranking Member Johnson for her opening statement.

    Ms. Johnson. Thank you very much, Mr. Chairman, and thank 
you for calling this hearing. And let me thank Secretary Chu 
for being willing to come. I am always delighted to be in the 
presence of a Nobel Laureate because I know I can learn a lot.
    I am just trying to figure out how to start this. I will be 
the first to say that on balance I am not particularly happy 
with this budget request. I think that too many worthwhile 
programs will be cut while others will not be increased enough. 
Still, I applaud the Administration for making tough decisions 
and prioritizing in a time of fiscal austerity. It is 
undoubtedly a painful but useful exercise. And in better times, 
these programs would receive the funding they need.
    However, I cannot help but lament the fact that we find 
ourselves in this position to begin with and I feel that 
Congress has to accept its share of the blame. We in Congress 
could acknowledge the immense challenges in energy that lie 
before us and have the foresight to know that increased 
investment across the energy technology spectrum, from basic to 
applied research and demonstration, will pay untold dividends 
for future generations. We could recognize the role that truly 
fundamental discovery-driven research and large user facilities 
play in positioning the United States at the center of 
mankind's quest to better understand our universe.
    Instead, unfortunately, this Congress seems content to put 
DOE in a corner and tell it to figure out how to do more with 
less. We say we want to run government more like business. 
Well, businesses need revenue or they don't grow, they don't 
innovate, and they don't succeed. We could start to raise the 
needed revenue by pulling back the unnecessary tax breaks and 
subsidies enjoyed by the most profitable and wealthiest 
companies and individuals in this country and we could use 
those resources to invest in our scientific talent and 
infrastructure and in development of new, cleaner, more 
efficient, and cheaper energy technologies.
    I am under no illusion that change will come overnight. We 
are just beginning to chip away at the multigenerational energy 
problem, the scale and complexity of which few of us can grasp. 
But we have to start now if we want to make a positive impact 
for future generations. We can begin by giving up on the notion 
that the energy market has ever been or ever will be a free 
market. In a perfect world, consumers would be empowered with 
the knowledge and resources to make informed choices about 
their energy use, and investors would be willing to take bigger 
risks on companies that are driven to create the cleanest and 
most efficient technologies. But we are just not there yet. 
Until we see more competition from emerging sectors, the energy 
markets will not be free.
    Some of my colleagues on the other side of the aisle decry 
DOE's investment in clean energy technologies as somehow 
skewing the market by picking winners and losers and crowding 
out private investment. Yet the very energy industries my 
colleagues hold out as exemplars of the free market--oil, gas, 
nuclear, and coal--are the ones that have benefitted most from 
the government largesse, and curiously, the ones they hold out 
as most deserving of continued taxpayer-funded research.
    From high efficiency gas turbines to coal plants to nuclear 
reactors developed at federal labs with federal dollars to the 
directional drilling and hydraulic fracturing practices that 
have led to the shale gas boom of today, we have seen how 
government research can pay off, but it required decades of 
federal investment, the overwhelming majority of which was 
focused on fossil and nuclear energy. These technologies have 
kept energy costs low to consumers and our industrial base, and 
allowed the economy to grow to what it is today. But it is time 
to level the playing field and introduce real competition to 
the markets. And that is where the priorities set by this 
budget request come into play. We have to find the greatest 
value for the taxpayer's dollar, and today, it is in the 
emerging energy technology sectors that can most benefit from 
government support. We have seen how federal dollars can be the 
seed capital for private sector innovation, and how even small 
government investments can be leveraged to provide scientific 
breakthroughs and technological advances that private industry 
by itself cannot--or at least will not--accomplish.
    We also know well that without federal sponsorship of 
fundamental research in physical sciences, America will fall 
behind in these fields. These are investments in people and 
ideas that have paid off in the past, and I hope that we can 
demonstrate the foresight to know that they will continue to 
pay off in the future.
    Thank you and I yield back.
    [The prepared statement of Ms. Johnson follows:]

       Prepared Statement of Ranking Member Eddie Bernice Johnson

    Thank you, Chairman Hall, for calling this hearing today to review 
the Administration's fiscal year 2013 budget request for the Department 
of Energy's civilian research programs. And, thank you, Secretary Chu, 
for joining us today to provide your perspective on how these proposals 
were developed, and insight into the President's vision for both the 
Department and the role of energy in our economy.
    I will be the first to say that, on balance, I am not particularly 
happy with this budget request. I think that too many worthwhile 
programs would be cut, while others will not be increased enough. 
Still, I applaud the Administration for making tough decisions and 
prioritizing in a time of fiscal austerity. It is undoubtedly a painful 
but useful exercise, and in better times these programs would receive 
the funding they need. However, I cannot help but lament the fact that 
we find ourselves in this position to begin with, and I feel that 
Congress has to accept its share of the blame.
    We in Congress could acknowledge the immense challenges in energy 
that lie before us, and have the foresight to know that increased 
investment across the energy technology spectrum--from basic to applied 
research and demonstration--will pay untold dividends for future 
generations. We could recognize the role that truly fundamental 
discovery-driven research and large user facilities play in positioning 
the U.S. at the center of mankind's quest to better understand our 
universe.
    Instead, unfortunately, this Congress seems content to put DOE in a 
corner and tell it to figure out how to do more with less. We say we 
want to run government more like business. Well, businesses need 
revenue or they don't grow, they don't innovate, and they don't 
succeed. We could start to raise the needed revenue by pulling back the 
unnecessary tax breaks and subsidies enjoyed by the most profitable and 
wealthiest companies and individuals in this country. And we can use 
those resources to invest in our scientific talent and infrastructure, 
and in development of new, cleaner, more efficient and cheaper energy 
technologies.
    I am under no illusion that change will come overnight. We are just 
beginning to chip away at a multi-generational energy problem, the 
scale and complexity of which few of us can grasp. But we have to start 
now if we want to make a positive impact for future generations.
    We can begin by giving up on the notion that the energy market has 
ever been, or will ever be, a free market. In a perfect world, 
consumers would be empowered with the knowledge and resources to make 
informed choices about their energy use, and investors would be willing 
to take bigger risks on companies that are driven to create the 
cleanest and most efficient technologies. But we are just not there 
yet. Until we see more competition from emerging sectors, the energy 
markets will not be free.
    Some of my colleagues on the other side of the aisle decry DOE's 
investment in clean energy technologies as somehow skewing the market 
by picking winners and losers and crowding out private investment. Yet, 
the very energy industries my colleagues hold out as exemplars of the 
free market--oil, gas, nuclear and coal--are the ones that have 
benefitted most from government largesse and, curiously, the ones they 
hold out as most deserving of continued taxpayer-funded research.
    From high-efficiency gas turbines for coal plants, to nuclear 
reactors developed at federal labs with federal dollars, to the 
directional drilling and hydraulic fracturing practices that have led 
to the shale gas boom of today, we have seen how government research 
can pay off. But it required decades of federal investment, the 
overwhelming majority of which was focused on fossil and nuclear 
energy.
    These technologies have kept energy costs low for consumers and our 
industrial base, and allowed the economy to grow to what it is today. 
But, it is time to level the playing field and introduce real 
competition to the markets, and that is where the priorities set by 
this budget request come in to play. We have to find the greatest value 
for the taxpayer dollar, and today it is in the emerging energy 
technology sectors that can most benefit from government support.
    We have seen how federal dollars can be the seed capital for 
private sector innovation, and how even small government investments 
can be leveraged to provide scientific breakthroughs and technological 
advances that private industry by itself cannot accomplish. We also 
know well that without federal sponsorship of fundamental research in 
the physical sciences, America will fall behind in these fields. These 
are investments in people and ideas that have paid off in the past, and 
I hope that we can demonstrate the foresight to know that they will 
continue to pay off in the future.
    Thank you, and I yield back.

    Chairman Hall. I thank you, Ms. Johnson.
    And if there are Members who wish to submit additional 
opening statements, your statements can be added to the record 
at this point or whenever you want to.
    At this time, I would like to introduce our witness, Dr. 
Steven Chu, who serves as the Secretary of Energy. Dr. Chu is 
currently serving as the 12th Secretary of Energy. He is a 
distinguished scientist and has devoted his scientific career 
to the search for new solutions to our energy challenges.
    Prior to his service as Secretary, Dr. Chu was a Director 
of DOE's Lawrence Berkeley National Lab and was a Professor of 
Physics in molecular and cell biology at the University of 
California Berkeley. He is a co-winner of the 1997 Nobel Prize 
for physics. That is quite an honor.
    As our witness should know, testimony is limited to five 
minutes, after which the Members of the Committee will have 
five minutes each to ask questions. We have for you flexibility 
as you need because it is an honor to have you here. We know 
your schedule and we thank you for your time. So at this time 
we will recognize you for as much time as you require. And 
thank you for being here.

                  STATEMENT OF MR. STEVEN CHU,

              SECRETARY, U.S. DEPARTMENT OF ENERGY

    Secretary Chu. Thank you, Chairman Hall, for those kind 
remarks. And also Ranking Member Johnson, Members of the 
Committee, thank you for the opportunity to discuss the 
Department of Energy's fiscal year 2013 budget request.
    To promote economic growth and strengthen security, 
President Obama has called for an ``all-of-the-above'' strategy 
that develops every source of American energy. The President 
wants to fuel our economy with domestic sources of energy while 
increasing our ability to compete in the clean energy race.
    The Department's Fiscal Year 2013 budget request of $27.2 
billion is guided by the President's vision, our 2011 Strategic 
Plan, and our inaugural Quadrennial Technology Review. It 
supports leadership in clean energy technologies and invests in 
science and innovation to promote economic prosperity. Decades 
ago, the Energy Department support helped develop the 
technologies that have allowed us to tap into America's 
abundant shale gas resources. Today, our investments can help 
advance technologies that will unlock the promise of renewable 
energy and energy efficiency.
    The budget request invests approximately $4 billion in our 
energy programs. It advances progress in areas from solar to 
offshore wind to carbon capture and utilization and storage, to 
smart grid technologies. It will also help reduce America's 
dependence on foreign oil, which every day places a crushing 
burden on families and on our economy. As the President and I 
have said, there is no silver bullet and there are no easy 
answers, but we can and must pursue a serious, long-term, all-
of-the-above approach that diversifies our energy mix, protects 
consumers from the high price of gas, harnesses American 
resources, and creates jobs here at home. That is exactly what 
this budget does.
    The budget request also invests $770 million in a nuclear 
energy program to help develop the next generation of nuclear 
power technologies, including small modular reactors. It 
includes funding for continued nuclear waste R&D, which aligns 
with the recommendation of the Blue Ribbon Commission on 
America's Nuclear Future.
    As we move to a sustainable energy future, America's fossil 
energy resources will continue to play an important role in our 
energy mix. The budget request includes $12 million as part of 
a larger R&D initiative by the Departments of Energy, Interior, 
and EPA to understand and minimize the potential environmental 
health and safety impacts of natural gas development through 
hydraulic fracturing. The budget also promotes energy 
efficiency to help Americans save money by saving energy, and 
it sponsors R&D on industrial materials and processes to help 
U.S. manufacturers cut costs.
    To maximize our energy technology efforts in areas such as 
batteries, biofuels, and electric grid technologies, we are 
coordinating research and development across our basic and 
applied research programs and ARPA-E. Competing in the new 
energy economy requires our country to harness all of our 
resources, including American ingenuity.
    To help keep the United States at the forefront of science 
and technology, the budget request includes $5 billion for the 
Office of Science to support basic research that could lead to 
new discoveries and help solve energy challenges. These funds 
support progress in materials science, basic energy science, 
advanced computing, and more. They also provide America's 
researchers and industries with state-of-the-art tools.
    The budget request continues to support Energy Frontier 
Research Centers, which aim to solve specific scientific 
problems to unlock new clean energy development. It also 
supports the five existing Energy Innovation Hubs and proposes 
a new Hub in electricity systems. Through the Hubs, we are 
bringing together our Nation's top scientists and engineers to 
achieve game-changing energy goals.
    Additionally, the budget request includes $350 million for 
ARPA-E to support research projects that could fundamentally 
transform the way we use and produce energy. ARPA-E invests in 
high-risk, high-reward research projects that, if successful, 
could create the foundation for entirely new industries. Eleven 
projects that received a total of $40 million from ARPA-E over 
the last two years have done such promising work that they now 
have attracted more than $200 million in combined private 
sector funding. Taken together, our research initiatives will 
help rev up America's great innovation machine to accelerate 
energy breakthroughs. In addition to strengthening our economy, 
the budget request also strengthens our security by providing 
$11.5 billion for the National Nuclear Security Administration.
    The budget request makes strategic investments to promote 
our prosperity and our security. At the same time, we recognize 
the country's fiscal challenges and are cutting back where we 
can. We are committed to performing our work efficiently and 
effectively. We are also breaking down barriers to make it 
easier for businesses to move technologies from our national 
labs to the marketplace, which can help the United States seize 
technological leadership.
    Countries around the world recognize the energy opportunity 
and are moving aggressively to lead. This is a race we can win, 
but we must act with fierce urgency.
    Thank you, and now I am pleased to answer your questions.
    [The prepared statement of Secretary Chu follows:]

                 Prepared Statement of Mr. Steven Chu,
                  Secretary, U.S. Department of Energy

    Chairman Hall, Ranking Member Johnson, and Members of the 
Committee, thank you for the opportunity to appear before you today to 
discuss the President's Fiscal Year 2013 Budget request for the 
Department of Energy.
    To promote economic growth and strengthen national security, 
President Obama has called for ``an all-out, all-in, all-of-the-above 
strategy that develops every source of American energy--a strategy that 
is cleaner and cheaper and full of new jobs.'' The President wants to 
fuel our economy with domestic energy resources while increasing our 
ability to compete in the global clean energy race.
    Although the United States has reclaimed the title of world leader 
in clean energy investments, we are at risk of falling behind again 
unless we make a sustained federal commitment to supporting our 
domestic clean energy economy. To compete globally, America has to do 
more than invent technologies; we also have to produce and sell them. 
Our country faces a stark choice: we can create jobs making and 
exporting the energy technologies of tomorrow or we can cede leadership 
to other countries that are investing in these industries. As President 
Obama reiterated in his State of the Union address, passing a Clean 
Energy Standard is a vital step that Congress can take to broaden our 
clean energy market and promote U.S. leadership.
    Making the most of America's energy resources is a pillar of the 
President's economic blueprint to build an economy that lasts. The 
Energy Department also supports other key elements of the President's 
agenda including leading in innovation; reducing our dependence on oil; 
cutting costs for families, businesses, and manufacturers through 
energy efficiency; and reducing nuclear dangers worldwide.
    Guided by the President's vision, the Department's 2011 Strategic 
Plan and our inaugural Quadrennial Technology Review, our FY 13 budget 
request of $27.2 billion invests in the following priorities:

      Accelerating the transformation of America's energy 
system, and securing U.S. leadership in clean energy technologies;

      Investing in science and innovation to promote our 
Nation's economic prosperity; and
      Keeping Americans safe by enhancing nuclear security 
through defense, nonproliferation, and environmental cleanup.

    These priorities will be enabled through a continuing commitment to 
fiscal responsibility and management excellence.

Leading in the Energy Technologies of the 21st Century

    Last year, a record $260 billion was invested globally in clean 
energy, and trillions of dollars will be invested in the coming 
decades. To seize this market and job creation opportunity, the 
President's budget request invests in programs that advance research, 
development, manufacturing and deployment of the energy technologies of 
the future.
    Decades ago, support from the Energy Department helped to develop 
the technologies that have allowed us to tap into America's abundant 
shale gas resources. Today, our investments can help us advance 
technologies that will unlock the promise of renewable energy and 
energy efficiency.
    The budget request invests approximately $4 billion in our energy 
programs. It supports the Department's SunShot initiative to make solar 
energy cost-competitive with any other form of electrical energy, 
without subsidy, by the end of the decade. It advances technological 
progress in areas ranging from offshore wind to carbon capture, 
utilization and storage to smart grid and energy storage. And it helps 
reduce our dependence on oil by developing the next generation of 
biofuels and accelerating research in advanced batteries and fuel-
efficient vehicle technologies.
    Leadership in nuclear energy technologies is also essential to our 
ability to compete globally. The budget request invests $770 million in 
the nuclear energy program to help develop the next generation of 
nuclear power technologies, including small modular reactors. It also 
includes funding for continued R&D on the storage, transportation and 
disposal of nuclear waste, which also aligns with the recommendations 
of the Blue Ribbon Commission on America's Nuclear Future.
    As we move to a sustainable energy future, America's fossil energy 
resources will continue to play an important role in our energy mix. 
President Obama is committed to developing our oil and gas resources in 
a safe and sustainable manner. Last year, our oil import dependence was 
at its lowest level in 16 years, oil production reached its highest 
level in eight years. and natural gas production set a new record. 
Building on this progress, the Energy Department's budget request 
includes $12 million as part of a $45 million priority research and 
development initiative by the Departments of Energy, the Interior, and 
the Environmental Protection Agency to understand and minimize the 
potential environmental, health, and safety impacts of natural gas 
development through hydraulic fracturing (fracking).
    The budget request also promotes energy efficiency to create jobs 
and to help Americans save money by saving energy. It supports home 
weatherization and calls for passage of the HOME STAR program to 
provide incentives to homeowners to make energy efficiency upgrades. It 
also invests in research and development to improve building efficiency 
and supports the President's ``Better Buildings'' Initiative to 
catalyze private sector investment in commercial building efficiency. 
Finally, the budget request sponsors R&D on industrial materials and 
processes to help U.S. manufacturers cut costs and improve their global 
competitiveness.
    To maximize our energy technology efforts, the Department is 
breaking down silos and coordinating research and development across 
our program offices. Modeled after our SunShot initiative, we're 
bringing together our basic and applied research programs and ARPA-E to 
harmonize their work in areas including batteries, biofuels and 
electric grid technologies.
    And to encourage manufacturing and deployment of clean energy 
technologies, the President has called for renewing and extending 
proven tax incentives including the Production Tax Credit, the 1603 
cash payment in lieu of tax credit program and the Advanced Energy 
Manufacturing Tax Credit, known as 48C.
    As industry, Congress, and the American people make critical energy 
decisions and require greater understanding of domestic and 
international energy markets, it's important that we adequately fund 
the Energy Information Administration, the nation's premier source of 
independent statistical information about energy production and use. 
That is why the budget request includes $116 million for EIA.

Unleashing U.S. Innovation to Create Jobs and Lead in the Global 
                    Economy

    Competing in the new energy economy will require our country to 
harness all of our resources, including as the President said, the 
``one critical, renewable resource that the rest of the world can't 
match: American ingenuity.'' A key part of our country's success has 
been our leadership in science and technology, but we can't take that 
leadership for granted. According to the National Science Foundation's 
2010 Science and Engineering Indicators report, from 1996 to 2007 the 
average annual growth of R&D expenditures in the United States was 
about five to six percent, compared to more than 20 percent in China.
    To help keep the United States at the forefront of science and 
technology, the budget request invests in cutting-edge research that 
could spur new jobs and industries. This includes $5 billion for the 
Office of Science to support basic research that could lead to new 
discoveries and help solve our energy challenges. These funds support 
progress in materials science, basic energy science, advanced computing 
and more. They also provide America's researchers and industries with 
state-of-the-art tools to help take their work to the next level.
    The budget request continues to support Energy Frontier Research 
Centers. The Energy Frontier Research Centers are working to solve 
specific scientific problems to unlock new clean energy development. So 
far, the EFRCs have published more than 1,000 peer-reviewed papers and 
filed more than 90 patent applications or patent/invention disclosures. 
Researchers are reporting multiple breakthroughs in areas ranging from 
advanced battery technology and solar energy to solid-state lighting 
and nuclear power.
    The budget request also supports the five existing Energy 
Innovation Hubs and proposes a new Hub in electricity systems. Through 
the Hubs, we are bringing together our Nation's top scientists and 
engineers to achieve game-changing energy goals. The Hubs continue to 
make progress. For example, the Modeling and Simulation for Nuclear 
Reactors Hub has released the first versions of its software that, upon 
completion, will simulate a virtual model of an operating physical 
reactor. The Fuels from Sunlight Hub has filed multiple invention 
disclosures and published scientific papers. And the Energy Efficient 
Building Systems Hub is developing advanced building modeling tools and 
has built one of the country's first 3-D building design labs.
    Additionally, the budget request includes $350 million for the 
Advanced Research Projects Agency for Energy, known as ARPA-E, to 
support research projects that could fundamentally transform the ways 
we use and produce energy. ARPA-E has invested in roughly 180 high-
risk, high-reward research projects that, if successful, could create 
the foundation for entirely new industries. These companies and 
research teams are working toward a prototype of a battery that has 
double the energy density and one-third the cost of batteries in 2010, 
bacteria that use carbon dioxide and electricity to make fuel for cars, 
grid scale electricity storage and other potentially game-changing 
breakthroughs. Eleven projects that received $40 million from ARPA-E 
over the last two years have done such promising work that they have 
now received more than $200 million in combined private sector funding.
    Taken together, our research initiatives will help rev up America's 
great innovation machine to accelerate energy breakthroughs.

Nuclear Safety and Security

    In addition to strengthening our economy, the budget request also 
strengthens our security by providing $11.5 billion for the 
Department's National Nuclear Security Administration. NNSA plays a key 
role in achieving President Obama's nuclear security objectives.
    As the United States begins the nuclear arms reduction required by 
the New START treaty, the science, technology, and engineering 
capabilities within the nuclear security enterprise will become even 
more important to sustaining the U.S. nuclear deterrent. The budget 
request includes $7.6 billion for Weapons Activities, a five percent 
increase over the FY 2012 enacted levels. This increase provides a 
strong basis for transitioning to a smaller yet still safe, secure, and 
effective nuclear stockpile. It also strengthens the science, 
technology, and engineering base of our enterprise. The budget request 
also includes $1.1 billion for the Naval Reactors program to ensure the 
safe and reliable operation of reactors in nuclear-powered submarines 
and aircraft carriers and to fulfill the Navy's requirements for new 
nuclear propulsion plants that meet current and future national defense 
requirements.
    Additionally, the budget request supports NNSA's critical work to 
prevent nuclear terrorism--one of the most immediate and extreme 
threats to global security and of one President Obama's top priorities. 
It includes $2.5 billion to implement key nuclear security, 
nonproliferation, and arms control activities. It supports efforts to 
detect, secure, and dispose of dangerous nuclear and radiological 
material around the world. And it will help the Department to fulfill 
its role in accomplishing the President's goal of securing all 
vulnerable nuclear materials worldwide in four years.
    Finally, the budget request includes $5.7 billion for the Office of 
Environmental Management to continue progress cleaning up the Nation's 
Cold War nuclear sites.

Fiscal Responsibility and Management Excellence

    The Department of Energy's FY 13 budget request makes strategic 
investments to promote our country's future prosperity and security. At 
the same time, we recognize the country's fiscal challenges and our 
responsibility to invest in much-needed programs while cutting back 
where we can. That is why the President's budget request eliminates $4 
billion in inefficient and unnecessary fossil fuel subsidies.
    Given the urgency of the challenges we face, the Department is 
committed to performing our work efficiently and effectively. We are 
streamlining our organization to improve performance and save taxpayer 
money. For example, the Department achieved approximately $330 million 
in strategic procurement savings in FY 11. We are taking several other 
steps such as reducing the size of our vehicle fleet, cutting back 
travel costs, and consolidating Web sites.
    We are also breaking down barriers to make it easier for businesses 
to move technologies from our national labs to the marketplace, which 
can help the United States seize technological leadership and create 
jobs. For example, we've started a program which makes it easier, 
quicker, and less costly for start-up companies to sign option 
agreements to license national lab technologies. And to make it easier 
to work with the labs, we've reduced the advanced payment requirement 
and streamlined the Cooperative Research and Development Agreement 
contract and approval process.
    Throughout American history, the Federal Government has played a 
critical role in supporting industries that are important to our 
prosperity and security, from aviation and agriculture to 
biotechnologies and computer technologies. We should continue to do so 
today to lead in the new clean energy economy. Countries in Europe, 
Asia, and throughout the Western Hemisphere recognize the energy 
opportunity and are moving aggressively to lead. This is a race we can 
win, but we must act with fierce urgency.
    Thank you, and now I am pleased to answer your questions.

    Chairman Hall. Sir, I thank you for your testimony.
    And I remind members that Committee rules limit questioning 
to five minutes. We try to stay as close to that as we can.
    The Chair at this point will open the round of questions. 
And I recognize myself for five minutes.
    Mr. Secretary, two years ago the Obama Administration 
unilaterally shut down the Yucca Mountain project and threw 
U.S. nuclear waste management policy into disarray. President 
Obama created a ``Blue Ribbon Commission'' at the same time his 
Administration dismantled the existing Nuclear Waste Management 
program. I ask a question of you and I want you to answer yes 
or no because I know how very great you are strengthening a yes 
or weakening a no or vice versa. You are capable--I do ask--and 
if you can't give me a yes or no answer, tell me you don't want 
to.
    Did you tell the Blue Ribbon Commission they could not 
consider Yucca Mountain in their report?
    Secretary Chu. That was not in the charge of the Blue 
Ribbon Commission.
    Chairman Hall. Well, now, you are not answering me yes or 
no. Can you do that if you can? I am going to assume that you 
did.
    To date, taxpayers have spent--is that okay?
    Secretary Chu. That was not----
    Chairman Hall. I don't want to suppress you. If you can 
tell me no as quick as you can say yes, why, I would like to 
hear it.
    Secretary Chu. It was not in the charge of the Blue Ribbon 
Commission.
    Chairman Hall. Okay. All right. To date, taxpayers have 
spent over $15 billion to study and prepare Yucca Mountain to 
serve as a repository and you know that. You know all about it. 
Additionally, since the creation of the Blue Ribbon Commission, 
the taxpayers' liability for not accepting ownership of 
radioactive waste by 2020 increased 21 percent to almost $21 
billion. With the massive investment and decades of study 
already completed on Yucca Mountain, why refuse to allow the 
Blue Ribbon Commission to even entertain the idea or even to 
consider that Yucca Mountain could be a part of America's 
nuclear waste policy management?
    Secretary Chu. The Blue Ribbon Commission was not designed 
as a siting commission. It was designed to look broadly at the 
back end of the fuel cycle. I think it was an extraordinary 
committee with able leadership, General Scowcroft and 
Representative Hamilton, and it came up with a number of 
recommendations that we hope Congress will consider very 
seriously. We in the Department of Energy have established a 
taskforce to look at these recommendations.
    Chairman Hall. Well, regardless of whether Yucca Mountain 
has a future--and apparently it doesn't--do you think there is 
a value in completing the scientific and technical review of 
the science suitability and making the results public to where 
people themselves can make their own decision on it whether you 
were right or wrong?
    Secretary Chu. Right now, the decision is before the courts 
and we are awaiting the decision. Of course, in the meantime we 
are looking at the recommendations of the Blue Ribbon 
Commission because I think everybody agrees that the backend of 
the fuel cycle needs the attention of the country and we need 
solutions.
    Chairman Hall. Last year, when you testified in this 
Committee, I asked you what impact the President's Clean Energy 
Standards would have on energy cost. And that is for American 
energy consumers who have to make that payment. You committed 
to having the Energy Information Administration examine the 
economic impact of the Clean Energy Standard, which they did at 
my request. And I thank you for that.
    And I ask unanimous consent to insert this into the hearing 
record. And without objection, it is so ordered.
    [The information may be found in Appendix 2.]
    Chairman Hall. Are you aware that that exercise and the 
findings of EIA--are--you are aware of that, aren't you?
    Secretary Chu. I am aware of many of the findings of EIA. I 
can't say that I remember exactly everything that they said.
    Chairman Hall. Well, this is yours or your people----
    Secretary Chu. Right.
    Chairman Hall [continuing]. And you produced this.
    Secretary Chu. That is correct.
    Chairman Hall. Let me provide this. Then let me help you. 
Let me provide just a brief summary of the results. Under the 
Clean Energy Standards similar to what President Obama proposed 
and as you outlined to me last year, the report found these 
things: household electricity will increase by $115 per person 
per year in 2025 and by $211 per person in 2035. Nationwide 
expenditures on electricity will increase by $41 billion in 
2025 and by $77 billion in 2035. Nationwide manufacturing 
employment would decline by a million jobs in 2025. And in his 
State of Union Address, the President reiterated his calls for 
Congress to mandate this Clean Energy Standard that we have 
here.
    Why is the President pursuing a policy to increase 
electricity cost on Americans? Can you give me an answer for 
that? Or you may not agree that he is, but I think the facts 
cry out that he is costing us and not drilling whether you like 
the word of how fossil fuels cause some problems, and of course 
they cause some problems. I am part of that problem because I 
was here when we wrote the Clean Air Act and we put the EPA in 
there to have a balancing figure, and that gave the EPA the 
strength that they are using now to push energy people around. 
And I resent that and I think everybody on this Committee 
resents it.
    I just--do you agree that any clean energy mandate, no 
matter how flexible it is, will increase the cost of 
electricity?
    Secretary Chu. First, let me respond to what you said about 
the President. The President by no means wants to increase the 
energy bills in America. He is very committed to making 
available both affordable and clean energy. What the EIA 
studies do typically is they look at existing technologies. 
They cannot--and they are acting responsibly and they do this 
for that reason. They cannot presume that there will be 
technological advances in the future so they say this is what 
we see today based on today's technologies.
    But having said that--may I----
    Chairman Hall. Sure. I am over my time but go ahead.
    Secretary Chu. I will try to be very brief. Having said 
that, it is the Department of Energy's mission to bring down 
these costs and it is our goal. And we feel that it is only a 
matter of when, not if, clean energy will be as competitive as 
any form of energy.
    Chairman Hall. That may be so. I can't argue the future 
with you, but I know about the past and I know how energy 
people feel and I know that energy States are being punished 
and the people are losing.
    My time is up. Recognize Ms. Johnson.
    Ms. Johnson. Thank you very much, Mr. Chairman. I would 
like to make this statement prior to my question and would like 
to note that while I do not object to Chairman Hall submitting 
for the record his analysis of the Clean Energy Standard, I do 
want to make it clear that it is one of several such analyses 
of the CES that should be considered.
    I am concerned that this analysis was designed from the 
start to show a worst-case scenario for the impacts of Clean 
Energy Standard on the economy, leaving out a number of 
critical factors that would have painted a more comprehensive 
and accurate picture of CES as it would actually be 
implemented. I urge my colleagues and the public to review some 
of the more rigorous and comprehensive analyses such as those 
directed by outside stakeholders and Senate Energy Committee 
Chairman Bingaman before coming to a conclusion about the role 
new energy technologies will play in the future.
    I might have some questions of the Secretary on this topic 
and make additional comments and the statement for the record, 
but thank you. I will now begin my questions.
    The Department of Energy's Quadrennial Technology Review 
sought to set priorities within the Department's portfolio. It 
finds that energy technologies addressing the transportation 
sector have been historically underfunded as compared to 
stationary energy. Do you believe there should be a different 
balance between transport and stationary energy within the DOE 
portfolio?
    Secretary Chu. Yes, very much so. In fact that was one of 
the conclusions of our Quadrennial Technology Review. Given the 
high price of gasoline, we said what can we do in the 
Department of Energy to advance technologies to reduce the cost 
of transportation for every American family? And so we were 
aligned with the idea that, first, we wanted alternatives. 
Diversification means that you are no longer solely dependent 
on oil for transportation. We were going to invest--we were 
going to be investing in technologies that can improve the gas 
mileage, again, but keeping costs the same or even reducing 
costs but increasing the gas mileage of automobiles that would 
also make our cars competitive internationally. We were going 
to be doing biofuels investments and battery investments.
    I am very happy to say that a company the Department of 
Energy invested in two days ago made an announcement that they 
now have a battery that has doubled the energy capacity with 
the same manufacturing costs. It is going to be--it is 
validated by a third party and so this is going to be great 
news because that means we can reduce the cost of plug-in 
hybrids, electric vehicles, and can imagine a day in the near 
future where you might see a $20,000 car all electric, the 
operating cost--it would save American families over $1,000 a 
year to have such a car.
    Ms. Johnson. Thank you. How does the fiscal year 2013 
budget address these findings that energy for the transport 
sector has been underfunded compared to electricity?
    Secretary Chu. Pardon? Could you repeat that again?
    Ms. Johnson. The budget--how does it address----
    Secretary Chu. Oh, fine. Fine, thanks.
    Ms. Johnson. Yes.
    Secretary Chu. It appears in several ways--first, in energy 
efficiency and renewable energy technologies. We have a lot of 
effort in batteries there. Our ARPA-E program is investing in 
very, very innovative, short-term, two-year funding for 
batteries. Office of Science is investing in the more 
fundamental aspects of science, the kind of science that when 
done at Argonne National Laboratories 10 years ago has worked 
its way into today's current batteries, but we want to fund 
science that five years and 10 years from today will further 
reduce the cost of batteries. We also fund biofuels so that 
next-generation biofuels can be competitive without subsidy 
with oil at, let us say, $80 a barrel. This would be very 
exciting.
    Ms. Johnson. Thank you very much.
    I yield back, Mr. Chair.
    Chairman Hall. I thank you, Ms. Johnson, and I will have an 
answer for you when we take our second group as to your 
surprise at my position.
    Recognize Mr. Sensenbrenner for five minutes.
    Mr. Sensenbrenner. Thank you very much, Mr. Chairman.
    Mr. Secretary, thank you for coming here.
    When President Bush left office, the average price of gas 
was $1.85. Now, it is at $3.65 and going up, a doubling of gas 
prices under the Obama Administration's watch. The President 
has said that he is going to look for every single area we can 
make an impact and help consumers in the month ahead. You said 
yesterday in another Congressional hearing in answer to a 
question by Congressman Nunnelee whether your overall goal was 
to lower the price of gasoline. And you said no. Now, I 
somewhat want to expand on the Chairman's statement that energy 
States are being punished. I think all American consumers are 
being punished, and as the price of gas goes up, money that can 
be invested in our already fragile economy is taken out of 
consumers' pockets. Did you want to retract what you said 
yesterday and help everybody working on at least slowing this 
spike in the price of gas and then lowering it?
    Secretary Chu. We very much want to not only slow the price 
but reverse the price increase in gasoline. If one reads my 
entire statement, it was very consistent with that. As I said 
in my opening remarks, we definitely feel the pain that every 
American and every business feels when the price of gasoline 
goes up. We have been focused in my time as Secretary of Energy 
and the President's time since taking office on trying to first 
do what we can with the tools we have available to decrease the 
prices. And the tools we have available in the Department of 
Energy are that we want to diversify our energy supplies 
because----
    Mr. Sensenbrenner. Well----
    Secretary Chu [continuing]. We want to increase the 
production of oil----
    Mr. Sensenbrenner [continuing]. Okay, but----
    Secretary Chu [continuing]. And gas but also diversity----
--
    Mr. Sensenbrenner [continuing]. You know, meanwhile the 
price of gas has gone up by 100 percent on your watch. And this 
is unacceptable. And I remember four years ago, the President, 
some of his supporters were complaining about the price of gas 
going up in the last year of the Bush Administration. Before 
you got your present job, you made a statement that you wanted 
to see the price of gas reach the prices that exist in Europe, 
and those are somewhere between $7 and $9 a gallon depending 
upon what country you are in. Can you retract that statement 
now, or is that still your goal and the goal of the 
Administration?
    Secretary Chu. That is not my goal. But let me----
    Mr. Sensenbrenner. Then will you retract the statement?
    Secretary Chu. Everything I have done as Secretary of 
Energy is to first try to lower the prices by--we have invested 
in ways to increase production. We have invested in other ways 
in batteries and biofuels and energy efficiency to help the 
American public.
    Mr. Sensenbrenner. Well----
    Secretary Chu. But----
    Mr. Sensenbrenner [continuing]. You know, there have been 
bans on offshore drilling, we have the President vetoing the 
Keystone XL pipeline, gas is subject to the law of supply and 
demand, and as economies get better, they use more energy. And 
there have been obstructions in increasing the supply that can 
be refined and sold to American consumers.
    Secretary Chu. First, let me also point out that when the 
President took office, the economy was in freefall. When the 
world goes into a terrible recession, that has a downward 
effect on gasoline prices. The price of oil--and the most clear 
correlation is between gasoline prices is----
    Mr. Sensenbrenner. Well, with all due respect, Mr. 
Secretary, the economy is not that healthy, employment is down 
in the United States in the last three years, unemployment is 
still higher than it was in January of 2009. You know, I have 
seen a trend that production will be increased on private land 
but not on federal land. And when is this Administration going 
to end the lockup increasing production on federal land? That 
will increase the production as well. The President did say he 
was going to put everything on the table and it seems to me 
that there are still a lot of items under the table that can 
increase production and maybe reduce the price of gas that this 
Administration is turning its back on. When is that going to 
change?
    Secretary Chu. Let me first finish my answer from the 
previous question. The economy was in freefall. In a severe 
recession, the price of gasoline goes down. The economy is 
coming back slowly. It is very--we are doing----
    Mr. Sensenbrenner. Well, the economy is coming back slowly, 
but the price of gas has gone up 100 percent in the last three 
years, and that is going to retard the economy coming back 
faster and more people getting jobs and more investment in 
creating jobs in the private sector. You know, all this doesn't 
add up. And, you know, I admire you for getting a Nobel Prize 
in physics. I don't think you would do very well in getting one 
in economics.
    And my time is up and I yield back the balance of my time.
    Chairman Hall. You are doing such a good job I yield to you 
another minute if you need it to let him answer some of these 
things.
    Mr. Sensenbrenner. I will be happy to let him answer.
    Secretary Chu. As I said before, the economy is rising. The 
President is very concerned; I am very concerned about the high 
price of gas. We are very concerned as gasoline prices and oil 
prices increase that that can have a dampening effect on the 
economy. That is why we are so focused on this and that is why 
the tools we have--that I have in the Department of Energy are 
focused on what we can do both in the near-term future, but 
also in the mid- and long-term future. The President has said 
very clearly that there is no single silver bullet, and that is 
why we applaud the rising production of gasoline and natural 
gas. That is why we are working with industry to see how we can 
get natural gas to be used for part of our transportation 
needs, and all those other----
    Mr. Sensenbrenner. Well, sir, you know, with all due 
respect, there is a silver bullet and it is going right in the 
wallet of the American consumer with the doubling of the price 
of gas on this Administration's watch. That has got to stop and 
I haven't seen you withdraw either your 2008 statement or the 
answer that you gave to Congressman Nunnelee yesterday. Thank 
you.
    Chairman Hall. The gentleman's time has more than expired. 
The Chair recognizes Ms. Fudge for five minutes.
    Ms. Fudge. I thank you, Mr. Chairman.
    And thank you so much, Mr. Secretary, for being here today.
    Mr. Secretary, in my home State of Ohio, manufacturing is a 
major industry and we have many unemployed workers, as you 
might imagine, whose skills are not being used. I see that you 
have a $150 million increase for the Advanced Manufacturing 
Office. Could you please tell me what kinds of technologies 
will be developed with the extra money and how it will help 
spur economic growth and employment in manufacturing States 
such as Ohio?
    Secretary Chu. Sure. One of the things--let me give you one 
example in Advanced Manufacturing. We know that composite 
materials--these are carbon composite materials in particular--
can play an incredible role in a lot of technologies, from 
airplanes to automobiles to just lighter-weight stronger 
materials. So we have a carbon composite facility that allows 
industries--U.S. industries--to come in and try different 
things in this facility, new manufacturing methods to lower the 
cost.
    Ms. Fudge. Where is the facility?
    Secretary Chu. This is actually in Oak Ridge.
    Ms. Fudge. Go ahead.
    Secretary Chu. Okay. Oak Ridge National Laboratory. So that 
is just one example of what we are trying to do in advanced 
manufacturing, again going directly to the goal of the 
Department of Energy and the goal of every action I have taken 
since I have become the Secretary of Energy, which is to help 
make more efficient automobiles, make them more efficient so 
the American consumers can purchase these automobiles and have 
less of a gasoline bill. And that is what we are doing as much 
as we can, all the tools to lower the prices--not to lower the 
prices but to help--we certainly want to lower the prices of 
gasoline, but we also want to have people use less.
    Ms. Fudge. Thank you.
    Mr. Secretary, Ohio has experienced at least 11 earthquakes 
in less than a year. The Ohio Seismic Network believes that 
they are tied to wastewater injection wells. I understand that 
the 11 earthquakes in Ohio are not necessarily related to the 
hydraulic fracturing technology but to the disposal of all the 
high volumes of hydraulic fracking wastewater going into 
injection wells. It is my understanding that compared to 
conventional oil and gas development, hydraulic fracturing will 
require significantly larger quantities of water. Is that true? 
And if so, how will all of this water be disposed of if not in 
injection wells?
    Secretary Chu. Well, we certainly are looking very 
carefully at the role of any sort of liquid and fluid injection 
into rocks and what their role might be in seismic events. We 
certainly have a lot of expertise in that. We feel that one 
does not want to triple--most of the seismic events are events 
that are so small in magnitude that people cannot feel them, 
but we certainly are very, very concerned and we are doing 
research into the extent that wastewater injection or any fluid 
injection into rocks could trip off a more significant event. 
And so this is one of the things that we do in the Department 
of Energy is to do research so that one could extract the gas 
and the gas liquids from fracking, but we do it in an 
environmentally safe way. And so we are committed on that path.
    Ms. Fudge. So to go back to the question, are you saying 
you are studying how to dispose of the waste, or what are you 
saying?
    Secretary Chu. Well, there are two questions. The question 
is what is the role--as you noted in your opening statement--
what is the role of fluid injection in triggering seismic 
events? And what can we do? So first, we need to establish what 
the role is. There is a very thoughtful piece written by a 
staffer, Professor Mark Zoback, on this, who was actually part 
of our Secretary of Energy Advisory Board Subcommittee, on 
trying to develop ways so we can extract natural gas with 
fracking in an environmentally responsible way. And so I 
think--I recommend you read that paper because it looks at what 
are the issues and also what is actually happening vis-a-vis 
water injection into the ground.
    Ms. Fudge. Mr. Secretary, I will have to get with your 
office on that.
    But just in an effort to be considerate of the time of my 
colleagues, Mr. Chairman, I will yield back.
    Chairman Hall. I thank the gentlelady.
    Mr. Rohrabacher, California, for five minutes. We will have 
a vote on the Floor in a little bit and we will comment on that 
when you finish, Mr. Rohrabacher.
    Mr. Rohrabacher. Yes, thank you very much.
    Secretary Chu, I saw that NASA in their budget request 
included funding to restart the plutonium-238 production to--
and this is powering deep space projects. I also noticed there 
is not a corresponding item in the DOE's budget request. Now, 
is plutonium production going to be restarted at NASA, and what 
is your expectation that NASA will cover all the costs of this 
program?
    Secretary Chu. I think we are working with NASA on that. 
The plutonium, as you noted, is used as an energy source for 
deep space missions. The probes are so far away solar power is 
not viable. And so we are working, too, with NASA on how the 
generation of that energy source----
    Mr. Rohrabacher. Well, if we are going to have a long-term 
space strategy, we need to make sure that this isn't lost in 
the shuffle because that is an important factor in having a 
successful deep space program.
    Let me ask you about the reactor program. I am very 
concerned that it seems that the spending that I have here--and 
I am submitting this, Mr. Chairman, these charts for the record 
at this point. Mr. Chairman, submitting this for the record.
    Chairman Hall. Without objection.
    [The information may be found in Appendix 2.]
    Mr. Rohrabacher. And it seems to indicate that we are 
spending money or you are proposing to spend money in a way 
that when it comes to reactors, nuclear reactors, that instead 
of going with the new reactors, the high-temperature reactors 
like Toshiba's S4s or GE's Prism or General Atomic's EM2, that 
instead what we are doing is focusing more resources and higher 
percentage resources on older light-water reactor-type 
technologies. Even though they are smaller modular reactors, it 
is still light-water stuff that is 50-year-old technology. Now, 
why are we doing that? Why are we not focusing on developing 
this new technology that could actually eat the waste and 
eliminate some of these problems about Yucca Mountain and 
everything, but instead spending our money on old technology?
    Secretary Chu. Well, the small modular reactors I wouldn't 
call specifically as old technology.
    Mr. Rohrabacher. Well, as long as it is based on light 
water, it is an old concept.
    Secretary Chu. The reason we are doing this is because 
there is a recognition that many of the power sites in the 
United States could not accommodate--and around the world--
could not accommodate large reactors on the scale to 1 to 1.5 
gigawatts. The electrical infrastructure would not accommodate 
that. And there is a race among countries. South Korea has 
already approved one of the small modular reactors in South 
Korea. But we are very concerned. This is something again that 
will help American industry because we believe these small 
modular reactors----
    Mr. Rohrabacher. Secretary, you and I both agree on that. 
The only--what we are disagreeing on is whether or not the 
money that is going into these small modular reactors is going 
to go into a high-temperature version or a light-water version 
of the reactor. And I am--I--for the life of me I can't 
understand when the high-temperature gas-cooled reactors, the 
reactors that we have here--as I say, Toshiba and both GE and 
General Atomics, these are--companies have--this is available. 
Why aren't we backing the companies up on the new stuff rather 
than light-water reactors? I mean--anyway, you get my point and 
I hope you would seriously look into that and consider a 
restructuring of that priority.
    One last area and I have only got one minute left. I am 
very concerned that we are not having an honest discussion on 
energy with this Administration. And I am talking about you, 
sir. I am talking about generally what we have--and I sat 
through the State of the Union. The President was taking both 
sides of every issue. And, you know, it is all of the above and 
then we know that just a few days before he said it is going to 
be all of the above to us, he was nixing, you know, the 
Keystone Pipeline. And I think we need to have a much more 
honest discussion on this. The American people are suffering 
right now. We got--we are not going to help manufacturing in 
these States that we just heard about if all the consumer money 
is being drained away and spending it on gasoline. And we are 
not going to have more gasoline until we have more production 
of gas and oil.
    And I have got 20 seconds left, so let me just say I 
noticed you are requesting $12 million to look at fracking. I 
hope it is not--that this is not what it appears to be from the 
rest of the Administration, $12 million that is spent on how to 
find out ways of stopping fracking, because fracking is what is 
going to bring down the cost of oil and gas and going to permit 
manufacturers to sell their products because people have money 
in their pocket rather than just putting it in the gas station. 
So I am hoping that that is not the case, but it seems to me, 
Mr. Chairman, everything indicates what we heard from the EPA 
and hopefully not with this $12 million expenditure that you 
are requesting that this Administration is committed not to 
opening up new oil and gas but to try and find ways of stopping 
it, getting those guys who are producing our oil and gas. And 
that needs to--we need to have an honest discussion of what our 
priorities really are. And I don't think we are getting it and 
again, not from you, but, frankly, from the President of the 
United States on this.
    Thank you very much, Mr. Chairman.
    Chairman Hall. The gentleman yields back. We do have a vote 
on. We have about eight minutes. The Committee will stand in 
recess until five minutes after the conclusion of the last 
vote. I hope everybody comes back. And we will try to be a 
little more honest----
    [Recess.]
    Chairman Hall. Thank you for your patience.
    And the Chair now recognizes Mrs. Bonamici for five 
minutes.
    Ms. Bonamici. Thank you very much, Mr. Chairman.
    Thank you, Mr. Secretary, for your service and for 
recognizing and mentioning the importance of reducing our 
dependence on foreign oil and fossil fuels. I was pleased to 
see that your testimony discusses ARPA-E, and you mentioned the 
innovative work being done in the area of battery design. Well, 
I am proud that one of those projects is taking place in 
Oregon, how there is a company called ReVolt Technology, and 
ReVolt has brought this innovative zinc-air battery research 
and also jobs to our community. And we have seen firsthand the 
importance of the ARPA-E program. And I see that the 
Administration has proposed increasing ARPA-E funds by $75 
million, and I wonder if you could elaborate on the importance 
of this increased funding in enabling us to continue building 
on these new technologies such as the new generation battery 
technologies that will help Americans move away from fossil 
fuel consumption.
    Secretary Chu. Sure. The design of ARPA-E was very focused. 
A short-term company or research group comes in with a specific 
idea. The tenure of these grants is something on the order of 
two years, very short-term, modest amounts of money to just 
push it over the edge. Very promising technologies, but we also 
designed in the America Competes Act that we wanted ARPA-E to 
really look for game-changing events, not incremental progress 
but game-changing events. And after two years, it ends and you 
get private sector funding or it gets picked up by someone 
else. And so that has proven to be very successful, as I note 
in my testimony. A small amount of money has been leveraged--
$40 million has already been leveraged to private sector 
investments of over $200 million. And we expect going forward 
that that number will even grow.
    Ms. Bonamici. Thank you. And I agree that it is a good 
investment.
    And also you speak about the need to invest in clean and 
renewable energy and ensuring that we have that access to clean 
renewable domestic energy as a matter of both national and 
economic security. Now, there is also some promising work being 
done in Oregon about the development of wave energy technology, 
and I know that is true with other coastal areas as well. So in 
addition to providing another means of energy production, we 
have also seen the research and development and manufacturing 
benefits.
    So it is critical that when we talk about domestic 
renewables, we also include in these discussions the 
encouraging developments around wave technology. And I wonder 
if you could address that issue as well.
    Secretary Chu. We certainly we are looking at all forms of 
new technologies. Kinetic wave technology is one; geothermal is 
another one. So it is not just restricted to solar and wind. 
And then the wind technologies, we think that on-land wind is 
being established, so we are concentrating on how those 
technologies can work in a marine environment, again because it 
is the research that we are really pushing.
    Ms. Bonamici. Sure. And--terrific. I just want to follow 
up. I just had a discussion with someone about the wave energy 
buoys with wind turbines on top, so I think we just really need 
to look at all options for making sure we have renewable 
sources of energy. So thank you for your work.
    And Mr. Chairman, I will yield back the balance of my time.
    Chairman Hall. The gentlelady yields back.
    Dr. Broun, Georgia, five minutes.
    Mr. Broun. Thank you, Mr. Chairman.
    Mr. Secretary, I believe that the Federal Government should 
not be picking winners and losers in the marketplace. It seems 
to me that DOE has repeatedly proven that this Administration 
is clueless when it comes to making good business investments 
and that it also tends to side with political crony companies. 
Unfortunately, the Department's political favors come with more 
than a billion-dollar price tag that will have to be paid for 
by American taxpayers.
    Time and time again, we have seen companies like Abound 
Solar, Beacon Power, A123 Batteries, and of course Solyndra 
receive millions and billions of dollars just to drop jobs. In 
addition to those $465 million that went to Tesla Motors to 
make a luxury electric car with a sticker price of $100,000, 
worst kind of corporate welfare. In the President's Energy 
budget, the few people to be able to afford those cars would 
receive a $10,000 tax subsidy. How can President Obama justify 
asking for more than a half a billion dollars in additional 
funding for his preferred green programs?
    Secretary Chu, you tell me why you think your department 
deserves more taxpayer money to blow through given your abysmal 
track record. What grade would you say you deserve for the 
management of the DOE resources over the last three years?
    Secretary Chu. Well, I would give myself a pretty good 
grade, because if you look at what we have done and what we 
have supported and the breakthroughs that have occurred during 
this tenure, I think it speaks very well. As I said before, the 
battery research has been going extremely well, way ahead of 
what we thought was the schedule. We are very focused on a lot 
of the grid technologies on solar technologies. And as another 
example of the Bioenergy Research Centers, which were started 
in the previous Administration, have done extremely well and we 
are continuing funding for those. A lot of the inventions and 
technologies are now being licensed by companies and they are 
entering the pilot productions. So there are many successes in 
the technologies that the Department of Energy has supported. 
And the private sector, American industries are picking up 
these technologies.
    Dr. Broun. So what grade would you give yourself, A to F?
    Secretary Chu. Oh, I don't know.
    Dr. Broun. What grade would you give yourself?
    Secretary Chu. There is always room for improvement, maybe 
an A minus.
    Dr. Broun. Sir, I give you a D minus or an F. Somebody who 
makes a 69 on a test fails. Now, you do have some successes. I 
appreciate the loan to the Georgia Power Company to put in 
place the two new reactors there at Plant Vogtle, the first 
reactor that has been authorized in over 30 years. We need to 
have the ability to put in place nuclear reactors very quickly. 
I would like to see a template so that if a company followed 
that template, they could just go ahead with the construction 
that the government would oversee it just to make sure it was 
being followed, but they wouldn't have to spend millions or 
billions of dollars in just trying to get approval from the 
Nuclear Regulatory Commission, particularly as anti-nuclear as 
this Administration has been.
    But you all have had failure after failure after failure. 
Sir, I am not sure why we should give you any more money 
because I think you have failed. Like I say, I believe you have 
got a D minus or an F at best.
    I yield back, Mr. Chairman.
    Chairman Hall. Gentleman yields back. Mr. Secretary, just 
for your knowledge, if you have ever been asked that question 
before, you are entitled to know how the Chairman did when 
asked that question. One time I made four Fs and a D, and my 
dad punished me for spending too much time on one subject.
    All right. Who do we recognize? Recognize Mr. Lujan.
    Mr. Lujan. Mr. Chairman, thank you very much.
    And Dr. Chu, in your prepared testimony you state that with 
the New START Treaty, the science, technology, and engineering 
capabilities within the nuclear security enterprise will become 
even more important to sustaining the U.S. nuclear deterrent. 
President Obama, during his State of the Union this last year, 
said ``today the discoveries taking place in our federally 
financed labs and universities could lead to new treatments 
that kill cancer cells but leave healthy ones untouched.'' He 
goes on to say that, ``We shouldn't gut these investments in 
our budget. Don't let other countries win the race to the 
future.''
    I would like to focus on this theme of nurturing the 
scientific engineering capabilities of the NNSA laboratories. 
With the 2013 budget request, NNSA's budget will have increased 
about 10 percent from 2011, yet over the same two-year time 
frame, the budget of Los Alamos National Laboratory will have 
decreased by about 10 percent. This is about a $300 million 
decrease in just two years and choked the scientific and 
engineering capabilities at our lab. Because of these budget 
cuts, the lab has requested a voluntary reduction and forced 
incentive program with the goal of eliminating 400 to 800 jobs. 
This reduces the true source of scientific and engineering 
capability, the men and women who have served the Nation there 
who have the experience and training that is difficult and 
expensive to replace.
    And finally, a recent National Academies' report, one that 
distrustful oversight by NNSA, in which individual transactions 
are reviewed at every step, is harming the vitality and long-
term viability of the science and engineering capability at the 
NNSA labs. When you combine all of this distrustful and harmful 
oversight with the significant loss of personnel and reduction 
of funding over multiple years, you get a very damaging set of 
events that could do permanent harm to the lab and my district 
in the northern part of New Mexico.
    So, Mr. Secretary, I have a lot of respect for you, but I 
have a lot of concern as to what has happened with Los Alamos. 
As I look at the budget, it looks like Los Alamos took a much 
greater hit than any of the other labs, and quite honestly, 
almost as much as the other labs combined. So, Mr. Secretary, 
what I am looking for is some assurance and some long-term 
commitment, one, to see how we can fix the arbitrary hits that 
look--that were targeted to Los Alamos, as well as a commitment 
to Los Alamos National Laboratory.
    Secretary Chu. Well, certainly, Los Alamos National 
Laboratory is an excellent laboratory, but within our budget 
constraints going forward, we do have to make hard decisions, 
but certainly Los Alamos is going to be an essential part of 
the future of the NNSA laboratories. Those hard decisions need 
to be made, but we feel that they have not only a very rich 
past but also an outstanding group of scientists and engineers 
in that laboratory and will be a vital part of the NNSA 
mission.
    Mr. Lujan. I appreciate it, Mr. Secretary, and I look 
forward to hopefully meeting with you soon with Senator 
Bingaman. I know a request has gotten in with yourself and Mr. 
D'Agostino and we look forward to having those conversations 
about the commitment to Los Alamos.
    And Mr. Chairman, I want to quickly turn to all of this 
conversation and attacks on President Obama with increasing gas 
prices. You know, report after report shows that production is 
up under this Administration. Under President Barack Obama, 
production is up. The Republicans in this Congress voted 
against an amendment that I offered on the Floor of the House 
and in Committee, in the Natural Resources Committee, when 
there was a provision in front of us to increase production in 
the Gulf.
    My amendment was real simple. It said during tough economic 
times, let us make a commitment--because I know how to count; 
my dad taught me how to count very young--and we knew the bill 
was going to pass. But what we asked our colleagues from the 
other side of the aisle was if we are going to pass this bill, 
let's at least commit to keep any new production in the United 
States for American consumption and to be refined in the United 
States. I couldn't get one of my colleagues from other side of 
the aisle to support that amendment. Ranking Member Markey 
offered something similar as well, which was defeated 
overwhelmingly.
    Last year, there were many individuals that provided 
testimony in the Senate talking about the problems with 
speculation. Mr. Tillerman, the boss of ExxonMobil, admitted 
last week that the price--and this was back in 2011, early 2011 
or in May--that the price of oil based purely on supply and 
demand should be $60 to $70 a barrel. The reason it is above 
$100 a barrel, Tillerman explained, is due to the oil majors 
using futures contracts to lock into high prices. And we see 
article after article--the Commodities Future Trade Commission 
plans to issue a report next month talking about these 
problems. If we are serious about doing something now, we 
should tap the reserves we have and crack down on speculation, 
Mr. Chairman. And I think that enough is enough with the 
rhetoric. Let us do something real. We can get this done 
together, and there is support from all sides.
    And with that, Mr. Chairman, I yield back.
    Chairman Hall. I accept your yielding back and I admire you 
as a good Member and as a member of a great family of public 
servants from your State. I don't agree with you very much on 
your analysis of the President, though, and you don't expect me 
to, do you?
    Mr. Lujan. Mr. Chairman, I think that is why we are 
friends. As the good Governor King from New Mexico used to say, 
some of my friends are for it and some of my friends are 
against it, and I will support my friends.
    Chairman Hall. There you go.
    I now recognize a very patient--probably might be the best 
Member over here who looks around and scolds me when I go over 
and I am trying not to do that. But I recognize Ms. Adams for 
10 minutes.
    Mrs. Adams. Thank you, Mr. Chair.
    Chairman Hall. Well, I am trying to get along with you.
    Mrs. Adams. I appreciate it.
    Secretary Chu, I sit here and I listen and that is what I 
do probably most intently because of my background as a law 
enforcement officer. I tend to listen to all the words being 
said. So I am going to ask you some questions and I would just 
appreciate a simple yes or no. We don't need to do a back-and-
forth or anything like that. I listen with great intent. As the 
Chairman asked you if Yucca Mountain was completely left out of 
the equation during the Committee, you said ``not in the 
charge.'' Would that not mean, yes, it was left out?
    Secretary Chu. The intent of Yucca Mountain was----
    Mrs. Adams. I--again, yes or no. It is just simple 
questions.
    Secretary Chu. Yes or no----
    Mrs. Adams. Okay. Let's move on to something a little bit 
easier since these are your words. I heard Chairman 
Sensenbrenner ask you some questions and I just wanted to know 
for the record do you still agree with your statement back in 
2008, ``Somehow, we have to figure out how to boost the price 
of gasoline to the levels in Europe.'' Do you agree with your 
statement you made in 2008 or have you changed your mind? Yes 
or no?
    Secretary Chu. We are working--I am working to decrease the 
price in--whatever tools we have----
    Mrs. Adams. Secretary Chu, do you stand by your statement, 
yes or no, in 2008?
    Secretary Chu. I do not want to raise the price of 
gasoline; I want to lower the price of gasoline. And all my 
actions as Secretary of Energy----
    Mrs. Adams. Did you not say last Tuesday to Congressman 
Alan Nunnelee's question that it was not the goal--overall goal 
of the Administration to lower gas prices?
    Secretary Chu. That is incorrect. What I had said if you 
would read the full statement--what I said was we are working 
very hard to lower the gasoline prices with the tools the 
Administration has, but in addition to that, specifically in 
the Department of Energy, we are trying to diversify the supply 
so that that will help the American consumers--the American 
families who are feeling terrible pain to actually----
    Mrs. Adams. Well, currently, in----
    Secretary Chu [continuing]. Have other choices.
    Mrs. Adams. You are right; they are feeling the pain and I 
hear about it when I go back to my district. We have got 
hardworking taxpayers who will put more money into their gas 
tanks. Would you not agree that when the fuel costs go up, 
everything goes up for our American people, everything from 
food to electricity to everything? Would you agree with that? 
Yes or no?
    Secretary Chu. I would agree that when the price of oil and 
the price of gasoline and diesel go up, that affects our 
economy in a very deep way, and that is why when----
    Mrs. Adams. And it affects every aspect of Americans' 
lives.
    Secretary Chu. And we are--that is why we are so focused on 
developing alternatives----
    Mrs. Adams. Well, then, you said earlier--and again, I am 
listening; I am trying to write as quickly--not to lower gas--
you were talking about gas prices, not to lower it, then 
certainly we want to lower it, but we want people to use less. 
So when you go back to your 2008 comments about having it rise 
up to the levels of Europe and then you go back to two days ago 
when you made your comment about it was not the 
Administration--the goal--overall goal of the Administration to 
lower gas prices. Then today, when you are in here saying not 
to lower--but certainly you want it to be lower, but you want 
people to use less. Doesn't that go back to the original 
statement that in 2008 when you said somehow we have to figure 
out how to make gasoline prices--boost the price of gasoline to 
the levels of Europe?
    Secretary Chu. It absolutely does not go back to that 
statement. As you look at all my actions and all that we are 
trying to do in the Department of Energy----
    Mrs. Adams. Well, that is just it. I have looked at your 
actions. I have looked at your actions and I have seen where 
taxpayers' money--hard-earned taxpayer money in this economy 
was sent to Solyndra when everyone, all the emails that--
everything that I have seen showed that there was a problem. 
Yet we have gas prices on the rise and I heard my colleague say 
100 percent. I have at least figured out it is over 89 percent. 
And I have a Secretary who is in one Committee saying one 
thing, two days later telling me a different statement, but 
back in '08 basically along the same lines of what you were 
saying two days ago.
    So I appreciate your comments, Secretary, but the actions 
and the words are not going together, and I am really concerned 
that your 2008 comments and statements are coming to fruition 
for the American people, and that worries me. I know from 
talking to people back home their electricity has gone up, 
their gasoline has gone up, and they are concerned that this 
Administration is not taking that seriously. So I would like 
for you to take that back with you to the Administration. 
People are hurting, and they want this Administration to do the 
right thing.
    We have sent them bill after bill, to the Senate. to allow 
for the drilling of our own resources. We have sent them and 
the Administration has denied the Keystone Pipeline. These are 
things that would help the American people today--today, 
Secretary Chu.
    And I yield back.
    Chairman Hall. The gentlelady yields back.
    Recognize Mr. Tonko, the gentleman from New York, for five 
minutes.
    Mr. Tonko. Thank you, Mr. Chair. And Mr. Chair, allow me to 
associate my comments with those of Representative Lujan, who I 
thought was spot on about the issue.
    And Secretary Chu, welcome and thank you for responding in 
professional capacity and enduring.
    Secretary Chu, I understand the Administration made some 
tough choices in this budget, and I have a question related to 
one of those tough choices, cuts that impact our Brookhaven 
National Lab, an important facility in New York State. I 
understand the number of operating hours of the Relative Heavy 
Ion Collider, or RHIC, will be cut in half compared to the 
facility's operating hours this year. Even this year, it will 
not be running to full operating capacity. As you know, this is 
an important research facility for the nuclear physics 
community. And in addition to the reduced operation time, the 
funding reduction will also impact facility maintenance and 
upgrades to ensure its long-term productivity. We have a long-
term investment in this facility and I know these are tough 
times, but I do not believe we should jeopardize our ability to 
continue use of important research tools like the RHIC. This 
does not send a positive message to our students and scientists 
who rely on access to these community facilities to do their 
research.
    So my question would be what plans are there at the 
Department to ensure that the continuity of the research being 
done by students and researchers there can be maintained under 
reducing operating hours?
    Secretary Chu. Well, as you pointed out, RHIC, the 
Relativistic Heavy Ion Collider, is an important part of our 
Nuclear Physics portfolio, but as you also pointed out, we face 
tough decisions and the tough decisions on all the worthy 
projects we have to fund. And so we will have to look at these 
things very carefully, but certainly the past discoveries of 
RHIC are applauded and I have met their very exciting team. But 
again, it is one of these very hard things. We haven't made 
specific plans on specifically going forward, but all the 
things and all the benefits and all the opportunities of RHIC 
do get weighed with all the other things. But, you know, we 
have a budget deficit, and we also have to act responsibly.
    Mr. Tonko. Um-hum. Well, it seems unlikely that we would be 
able to afford to build a new facility to do this work, so 
should we not be maintaining the RHIC and other unique DOE 
facilities to make the most of our investment? I would hope--I 
hear what you are saying, but I would hope that we could see 
the dividends that come because of this investment and how 
critical they are to our innovation into the future.
    Secretary Chu. I am not sure how to--because is there a 
question that I can respond to?
    Mr. Tonko. Well, you know, some have suggested, well, we 
might be able to build a new facility to do this work but I 
would think that would deny the efforts made to date and the 
outstanding track record that exists there.
    Secretary Chu. I am not sure who said that or anything but 
I think we want to use the facilities we have and as we 
contemplate new facilities, I mean, these are tough budget 
times. So we--again I am not sure who made that statement but I 
don't think this is being seriously considered but I can 
certainly get back to you on that.
    Mr. Tonko. Okay. And again thank you for the thoughtful 
dialogue. I think it is what we need these days with so many 
complex issues. And I just think that it needs--and can be 
done--in an atmosphere of respect. So thank you for responding 
in sound professional and thoughtful----
    Secretary Chu. Right.
    Mr. Tonko [continuing]. Manner here this morning and 
afternoon.
    Thank you, Mr. Chair. I yield back.
    Chairman Hall. And I thank you for yielding back a minute, 
very thoughtful of you and appreciate it.
    The Chair recognizes Mr. Hultgren, State of Illinois.
    Mr. Hultgren. Thank you, Mr. Chairman.
    Mr. Secretary, in 2006 you testified before the Rising 
Above the Gathering Storm panel. You said, ``In funding ARPA-E, 
it is critical that its funding not jeopardize the basic 
research supported by the Department of Energy's Office of 
Science. The Committee's recommendations are prioritized and 
its top recommendation in the area of research is to increase 
the funding for basic research by 10 percent per year over the 
next seven years.'' Mr. Secretary, you said that. That is your 
quote; those are your words that you said. So I want to take a 
look at the charts that we are going to put up on the screen 
breaking down your budget request, and I believe the Committee 
can also put a copy up so everybody can see it here.
    This is a chart that we put together. It is maybe a little 
bit difficult to see, but I will walk through it with you 
quickly. It shows your request for percentage changes in 
various programs on the vertical axis, and on the horizontal 
axis it shows the range of research activities from basic 
research, which is on the right below the line, to applied 
research bordering on State industrial policy on the left. 
Those numbers show a pretty clear story. Fundamental science 
research is cut and the President's industrial policy is 
boosted. How can you with a straight face tell me that you 
haven't funded the President's pet projects in industrial 
policy at the expense of fundamental research?
    Secretary Chu. Well, as your chart shows, we are seeking a 
2.4 percent increase in the Office of Science. The Office of 
Science is what we call our basic research program within the 
Department of Energy. The request is for roughly $5 billion. 
ARPA-E is just a beginning new program and their request was 
for a much smaller amount, $350 million. And so if one puts 
into perspective those two budgets, we still remain very 
committed to funding the Office of Science, which is our more 
basic research program.
    Mr. Hultgren. Well, again, I think as you go through the 
ones on the right and going further to the right I see 
Fermilab, which is very important to me, I have heard my 
colleagues on the other side of the aisle also talking about 
research facilities being slashed, Fermilab, eight percent cut. 
Other pet projects again getting that increase. But again this 
discrepancy of almost a 30 percent increase versus two percent 
versus ^8 percent. I don't know how you justify that with your 
own statement that says you were looking to increase basic 
scientific research, which is our national laboratories by 10 
percent per year, and yet here you are cutting it by eight 
percent.
    Secretary Chu. Well, you are now talking about the Fermilab 
specific request budget. What we are trying to work through is 
a plan to go forward in terms of the long baseline experiments 
and also what we are trying to work out and how to go forward 
in the Deep mine in South Dakota. And so again if you--you can 
look at percentage increases or you can look at absolute 
dollars, and when we look at the absolute dollars of the Office 
of Science, we have increased that budget and I am very, very 
supportive of increasing that budget. ARPA-E, again, it is very 
small compared to the Office of Science.
    Mr. Hultgren. Well, I want to work with you on making sure 
that we follow through on that. What I see with some of the 
projects there specifically dealing with South Dakota is it is 
on life support right now. I mean it is barely enough to keep 
it operational. And then with--we were talking about this with 
Dr. Holdren last week. The steps of this budget--it is on 
crutches right now and we are breaking the crutches away from 
that project with this budget. I am fearful of that because I 
really think we are going and taking something valuable away to 
our kids and our grandkids the great opportunities that we have 
had to pursue science and basic scientific research. We are 
failing our future if we undercut that with these projects.
    I am passionate about Fermilab, but I am passionate about 
other laboratories that I don't represent as well and want to 
see that same commitment there. I recognize the fiscal year 
2013 budget is constrained with so many pressures, 
discretionary spending caps, but this imbalance seems to 
represent a definite and indefensible trend to retrench on 
discovery science and promote more applied research. You 
neglect to balance the portfolio, which leaves the fundamental 
discovery science in disarray.
    And I just wonder is this the proper direction for the 
Department when investments in basic scientific research really 
underpin the Nation's science and technology enterprise?
    Secretary Chu. Well, very quickly, I would say I agree with 
you. The Office of Science is a very important part of our 
program, and we want to see that budget grow and increase and 
it does form the underpinnings of everything that leads to it, 
including all the underpinnings of the companies that are using 
discoveries in the Office of Science and in energy--clean 
energy, renewable energy, ARPA-E. And the Office of Science 
does form the basis of all that.
    Mr. Hultgren. Well, I hope we can follow through on that 
and see--I think we are seeing that clearly there is money 
there, and there is money that doesn't have to be taken away 
from some of this basic scientific research and we can bulk up 
that amount.
    Mr. Secretary, I do thank you for your service, and I do 
appreciate the ability to be able to discuss things, but it 
really does seem clear to me that this is an anti-science 
budget aimed at pushing short-term political agendas. I really 
do believe it is going to hurt our long-term economic 
competitiveness, our scientific enterprise, and our country.
    With that I yield back.
    Chairman Hall. Gentleman yields back.
    Chair recognizes Mrs. Lofgren, lady from California, five 
minutes.
    Ms. Lofgren. Well, thank you very much, Mr. Chairman.
    And Dr. Chu, it is good to see you as well.
    You know, in 1995 when I was a brand new Member of the 
House of Representatives, there was a very conservative 
Republican Congressman for the East Bay, Congressman Bill 
Baker. I am sure you remember Bill, and he recruited me and 
other people into an effort to pursue the National Ignition 
Facility at the Lawrence Livermore lab. And even though Bill is 
no longer a Member of Congress, that bipartisan support for the 
project has continued to this very day. And as you know, the 
project, the National Ignition Facility, has a key role to play 
in terms of our stewardship, and it is the lead effort in 
inertial confinement fusion. Are you aware, Dr. Chu, that if 
you look at the NNSA budget rules that will be applied, the 
bottom line for NIF is that if this budget remains as it is, 
they will essentially have to close and ``mothball'' next year?
    Secretary Chu. No, I don't believe that is true. Certainly, 
we do not want that to happen. They have--it is--construction 
has been completed. They are entering--over the last year 
entering into very exciting----
    Ms. Lofgren. Two shots a day.
    Secretary Chu [continuing]. Exciting experimental stage and 
we are looking forward to when they can actually prove that you 
can get what we call ignition, that more energy is going to 
come out than went in.
    Ms. Lofgren. Well, if I can, Dr. Holdren was here a couple 
of weeks ago. I asked him the same question, and he was honest 
enough to say he didn't know. And he called me back afterwards 
to follow up, and he agreed that the funding and mothballing 
the experiment after we spent over $4 billion on the capital, 
equipment, and to get to where we are would not be a smart 
thing to do. I called out--I mean the labs are not allowed to 
call us and lobby, but they do have to answer us when we call 
out there. And I was told that the net result would be 
mothballing NIF if this budget is retained by the lab.
    And so I am looking at ITER, which is--you know, we are 10 
percent of that effort and it is a long ways away if ever from 
getting--so we are proposing to increase their budget by $45 
million; at the same time we are going to shut down NIF and 
hundreds of American scientists will be laid off while we are 
sending money to this international effort that may never get 
started. How could that be--how can that be a smart decision?
    Secretary Chu. Well, first, let me--my knowledge of what is 
happening with the NIF program, it is--as you pointed out, this 
is a very important part of our NNSA budget. It enables us to 
more deeply understand the physics we need to understand going 
forward for our nuclear security. And so I know of no plans. To 
the best of my knowledge, and we can get back to you on this, 
the funding is adequate for NIF to continue because we need 
that facility. It has just been constructed.
    Ms. Lofgren. I know that. I was at the opening, as were 
you.
    Secretary Chu. Right. And under no circumstances do we have 
plans to mothball a facility that is working and just been 
constructed.
    Ms. Lofgren. Well, if I may, Mr. Chairman, I believe--I 
mean obviously I wouldn't have raised this if I hadn't been led 
to believe that that is in fact the case. So what I would like 
to do if I may is follow up with you. If necessary, we will do 
a bipartisan effort to defund the ITER contribution and 
redirect it to this effort if we need to. And I have already 
been talking to my friends on the other side of the aisle. I 
think we would have a bipartisan effort if we have to do that. 
But perhaps we can pursue this further off-calendar.
    I wanted to do a quick question on the advanced computing. 
There is a reduction of 4.6 percent in the High-Performance 
Computing and Network Facilities subprogram. I am not sure how 
that is going to work. Can you explain the impact on the whole 
program from that reduction?
    Secretary Chu. What we are doing--there has been a growth 
phase. We think high-performance computing is one of the keys 
to what the Department of Energy does, because high-performance 
computing enables industry to actually----
    Ms. Lofgren. We are for it.
    Secretary Chu [continuing]. Skip design cycles very much--
--
    Ms. Lofgren. Absolutely important.
    Secretary Chu. We are laying plans to do to the next step. 
For example, the high-performance computer at Oak Ridge, the 
Jaguar computer, will go from probably like several petaflops 
where it is today to perhaps as much as 20 petaflops. In the 
meantime, we are laying plans to go to exascale, because we 
think this simulation high-performance computing is showing 
repeatedly it can help U.S. industry avoid design engineering 
steps.
    Ms. Lofgren. No, I get all of that. The question, though, 
is what is the impact of the proposed decrease, the 4.6 percent 
decrease? Is it not a problem? And also is the exascale 
proposal put forward by the Berkeley lab, is that funded in 
this budget?
    Secretary Chu. The exascale--I mean an exascale is being 
developed in the Department of Energy.
    Ms. Lofgren. Right.
    Secretary Chu. We haven't made any determination about 
where it is going to go. And indeed we are working with 
industry because as we improve the petaflop scale computers we 
have in the Department of Energy, we are also looking and 
getting positive feedback from industry to actually partner----
    Ms. Lofgren. Right.
    Secretary Chu [continuing]. With industry to develop 
radically new technologies for this next----
    Ms. Lofgren. I wonder, Mr. Chairman, I know my time is up, 
but if we could just ask Dr. Chu what the impact of the 14 
percent--4.6 percent decrease would be, which was my original 
question.
    Secretary Chu. Right. We can get back to you on the 
details.
    If the Chairman will allow me just 20 seconds on ITER?
    Chairman Hall. I don't know how I could keep you from it.
    Secretary Chu. Well----
    Chairman Hall. Yes, the Chair will make that--I went a 
minute-and-a-half over. Be my guest.
    Secretary Chu. I just wanted to respond--to point out----
    Chairman Hall. Sir, you are entitled to----
    Secretary Chu. Okay, thank you.
    Chairman Hall [continuing]. Testify.
    Secretary Chu. That the ITER project, over 80 percent of 
the funds will be spent in the United States and on contracts 
in companies and national laboratories in the United States. 
And it is an international obligation we have and so--and we 
don't see it as actually in conflict with NIF.
    Ms. Lofgren. Well, I have supported ITER in the past, but 
it is premised on a robust scientific effort here in the United 
States. And if the information I have is correct that we would 
be mothballing NIF, I could no longer support, you know, 
increasing our funding to ITER. And it is decades away from 
beginning operation. So you know, there are plenty of 
scientists who have told me without regard to the budget that 
they no longer have confidence that the project is even going 
to succeed because of the political support and the budget 
problems. But that is a separate question.
    I thank the Chairman for letting me have a little more 
time.
    Chairman Hall. The gentlelady yields back.
    Mrs. Biggert, Illinois, five minutes.
    Mrs. Biggert. Thank you, Mr. Chairman. As usually happens, 
the last two members have skirted around the issues that I 
wanted to ask questions about but not quite the same.
    The budget repeatedly highlights President Obama's 
commitment to doubling the budget of key basic research 
programs at the Office of Science, along with NIST and NSF. But 
the budget request for the Office of Science is proposed to 
increase by only 2.4 percent, and at that rate, it is going to 
take about 30 years to double the budget and doesn't account 
for inflation. Meanwhile, the programs such as EERE and ARPA-E 
are proposed to increase by 29 percent and 27 percent. Do you 
think, then, that funding for the Office of Science really is a 
low priority for DOE?
    Secretary Chu. No, it is not a low priority. It is a 
priority. It is a high priority. As you well know, I spent my 
life doing fundamental science, and I know the value of 
fundamental science and what it leads to.
    Mrs. Biggert. Okay. Then--and then going to the Exascale 
Computing Initiative and it is a joint program between science 
and NNSA----
    Secretary Chu. NNSA.
    Mrs. Biggert [continuing]. And it seems that there appears 
to be an uncertainty regarding the funding for the NNSA's 
matching participation with no firm number in the budget 
request, and I hope that the Administration is committed to 
this joint venture and all the progress that the United States 
has made in supercomputing. But does the Department--do you 
think that that budget--that they are going to commit to a 
certain budget? And does the Department intend to deliver its 
exascale report to the Hill soon?
    Secretary Chu. Well, we--the Department of Energy is very 
committed to developing exascale computing because we see 
clearly all the advantages it will give not only the scientific 
community, but the industrial base in the United States. The 
NNSA, as you well know, is under significant budget strain. Our 
first responsibility in NNSA is to tend to the nuclear security 
of the United States and we hope that they can continue 
participation. But we do remain committed to making sure that 
we lead in exascale computing.
    Mrs. Biggert. But you don't have any figures yet----
    Secretary Chu. No.
    Mrs. Biggert [continuing]. For NNSA.
    Secretary Chu. But the Department does think that exascale 
computing is one of the frontiers that the United States should 
certainly invest in.
    Mrs. Biggert. Okay. And then the 2012 appropriations had--
for the study, and do you----
    Secretary Chu. Yes.
    Mrs. Biggert [continuing]. Know when that will be?
    Secretary Chu. I can get back to you on exactly when----
    Mrs. Biggert. Okay.
    Secretary Chu [continuing]. They expect it delivered.
    Mrs. Biggert. All right. Then just one other quick 
question--the budget request, $10 million from a Nuclear Waste 
Fund in fiscal year 2013, what is the purpose of this request 
and what is it going to be used for?
    Secretary Chu. Yes. First, we have commenced this study 
within the Department to look at the recommendations of the 
Blue Ribbon Commission. And also we would love to work with 
Congress in those recommendations as well. One of the things 
that the Blue Ribbon Commission felt was very important is we 
have out of our 200--we have roughly 104 operating nuclear 
reactors, but there are a number of sites where the reactors 
are no longer operating and yet we still have spent fuel there.
    Mrs. Biggert. Okay.
    Secretary Chu. And what we wanted to do was to begin to 
have the spent fuels put in dry cask storage with an envelope 
and get it licensed by the Nuclear Regulatory Agency so that 
they can be safely transported out of those now-dormant reactor 
sites because of all the security and issues that--at least to 
consolidate those few sites.
    Mrs. Biggert. Okay. Then one more quick question. And this 
is--involves Keystone. I am really worried about the fact that 
we are not going to have Keystone, and I cannot understand how 
we would let this go. And right now the Canadians are over in 
China negotiating with them to send the oil there. And I think 
that is such a mistake when we are trying to reduce our 
dependence on foreign oil and particularly the hostile 
countries that provide it. And we would just let this go when 
we--I know that you have already talked about working on the 
bottom part of this and going forward with that, and yet we 
have no resolution or the Administration has vetoed it.
    Secretary Chu. The Administration did not veto it. When 
Congress said you have to make a decision at this time, the 
State Department said we have to look at the environmental 
impacts at this time. And so it has not been vetoed. The 
Administration and we in the Department of Energy have 
applauded the fact and it was well known that the first 
bottleneck in this----
    Mrs. Biggert. And that was taken care of.
    Secretary Chu. It is being taken care of by several 
companies Cushing to Houston and Louisiana. The second 
bottleneck is between Chicago and Cushing. Those plans are also 
underway----
    Mrs. Biggert. I understand that.
    Secretary Chu [continuing]. And it is very important to 
clear up these domestic bottlenecks because then we can 
continue to develop the oil in North Dakota----
    Mrs. Biggert. If we have--if we will have the oil by the 
time that all these things are cleared up.
    Secretary Chu. Well, as I said, you know, the--you know 
that the same Keystone people are now working with, for 
example, the State of Nebraska on the crucial parts of the 
pipeline being built in the United States, which are going 
forward.
    Mrs. Biggert. Thank you.
    Thank you very much. Yield back.
    Chairman Hall. I thank the gentlelady.
    Recognize Mr. Miller, gentleman from North Carolina, for 
five minutes.
    Mr. Miller. Thank you, Mr. Chairman.
    Secretary Chu, I congratulate you for your modesty in not 
wearing your Nobel medallion to appear today. I am not sure it 
would have made any difference in how you were treated, but if 
it had been me, I think I probably would have worn it.
    There have been--well, one of the most spectacularly 
successful government programs is DARPA, not just doing 
research that nobody else would have done but getting 
transformational research to the marketplace. One of the 
proposals of the Augustine report, Rising Above the Gathering 
Storm, there was bipartisan support for in this Committee. 
Chairman Boehlert supported it, Bart Gordon supported it, was 
ARPA-E, a program modeled after DARPA for energy to do the kind 
of research that otherwise would not get done because it is 
more likely than not that any given research would be 
fruitless. But the research that did work out could change 
things in a dramatic way.
    But there is also criticism that ARPA-E projects duplicate 
other research at the front end of their research and that it 
crowds out private sector funding at the back end, and it is 
hard to get things to the marketplace unless there is some 
overlaps, some kind of handoff to private sector funding. How 
do you identify--and also it is kind of hard to find research 
in which nobody has done any research to see that as a 
promising area of research. How do you identify the research 
that ARPA-E will do? Do you duplicate research that is being 
done or has been done by the private or by the public sector? 
And then how do you make that pass-off to private sector 
development? Do you crowd out public investment?
    Secretary Chu. Well, thanks for the question. First, there 
is a big distinction between the research that ARPA-E funds and 
the research, for example, that the Office of Science funds. 
The Office of Science funds research that lays foundational 
science that could lead to energy innovations. ARPA-E is 
focused on very short-term grants, typically two years, and 
modest amounts of money that can push something over the top. 
In some of those grants, they go to universities. Other grants 
go to small startup companies where there is a melding of 
public and private dollars. But we also tried to identify those 
things where a small starting company would not have the 
resources to take a next step. And in many cases--in most cases 
what we try to do--or a large company says, all right, you 
know, this is too much to swing for the fences, but if we are 
willing to get some assistance from ARPA-E, we will try these 
dramatic attempts.
    And that was the philosophy of DARPA and that is the 
philosophy of ARPA-E, something where you could not possibly 
imagine, for example, some way of--a global positioning 
satellite system. It is a great triumph of DARPA to look very 
far into the future and say, you know, it might be possible to 
use this system in military applications, but it now turns out 
to have fantastic commercial applications. But in ARPA-E, those 
things that we fund are these very short-term--now. There are 
certain spaces. We identified in ARPA-E, for example, power 
electronics. These are the electronics that convert high 
voltage to low voltage or DC to AC or AC to DC. For whatever 
reason, the university system wasn't investing in power 
electronics to build up a base of that. And if you talk to any 
companies, they would love to hire people trained in power 
electronics. We identify power electronics as a real growth 
industry. About 30 percent of electricity goes through some 
sort of power electronics today, but in 15 years or so we are 
expecting 80 percent to go. The industry wants this and we are 
helping companies develop power electronics and we are also 
trying to get universities to fund power electronics faculty.
    So the ARPA-E funding in power electronics says if we can 
make a transistor--not a silicon transistor but like a silicon 
carbide, we have entered in funding with a company making 
fantastic power electronics, very high voltage, high current so 
you can regulate power much more efficiently, much more 
inexpensively. Again, we see this as a great opportunity for 
American prosperity because these things are things we think 
the United States should be leading in. And again, it is a very 
identified target.
    Mr. Miller. Thank you, Mr. Chairman. My time is expired.
    Chairman Hall. I thank the gentleman. Now, probably you 
save the best for the last normally, but I don't ever like to 
say anything until the last at my age for today I am talking 
about.
    I recognize you, Mr. Harris, and I am going to ask for a 
minute or so to visit with Ms. Johnson. Okay with you?
    Mr. Harris. Certainly. Anything you want, Mr. Chairman.
    Listen, thank you, Dr. Chu. And I--you know, I share the--
what my colleague from North Carolina says. I appreciate a 
Nobel Prize winner coming in front of us, especially one in 
physics. I told you before I never understood it. I was a 
physiologist, not a physicist. You know, I respect that. But 
that does give us--and I know from personal experience that 
sometimes scientists like that kind of get a little tunnel 
vision. To someone with a hammer, everything looks like a nail.
    You talked about breakthroughs and of course that should be 
what I think the Department of Energy is all about. I am going 
to ask you a question. Would you agree with me that the biggest 
energy breakthrough in the last three years and one month has 
been that the cost of natural gas is one-half of what it was 
when the President took office, yet the price of gasoline is 
twice as high so that in fact there is a breakthrough that has 
led to a hugely important energy source. Would you agree that 
that really is--to someone looking objectively, that is really 
the largest breakthrough that has occurred in energy in this 
country?
    Secretary Chu. I would agree that that it certainly has 
been a breakthrough but it had a long birth period.
    Mr. Harris. Sure, but I mean the halving of a price----
    Secretary Chu. Um-hum.
    Mr. Harris [continuing]. In one energy source while another 
source is doubled now and we think is still going up--and by 
the way, you know, I thank you--I hope that your bias from 
before when you were Secretary and said we should have 
European-style prices, I hope you had an epiphany, you and the 
President and that, in fact, that is probably not a good thing 
now. But let's look at what the Department does. The 
Department's budget next year has one-fifth of one percent of 
its spending on natural gas, one-fifth of one percent. It is 
smaller than the increase in solar spending. Would you say that 
the Administration kind of missed the boat on this natural gas 
phenomenon that really some people look at and say is the 
future and the real breakthrough in American energy?
    Secretary Chu. Well, I agree with you that the ability to 
capture natural gas from shale rock was wonderful--is 
wonderful. The Department of Energy funded this from about 1978 
to 1992.
    Mr. Harris. And how much in the last three years?
    Secretary Chu. Well, right now, what we are doing is we are 
going to the next new thing in gas. We are funding methane 
hydrates. This is in collaboration with industry but we also 
have helped bring Japan on board because we think methane 
hydrates might be another form. It is too early to tell. Just 
as we funded drilling and hydraulic fracturing many, many years 
ago when industry did not think it was viable----
    Mr. Harris. Sure. What is your budget level on methane 
hydrates?
    Secretary Chu. It is very small but we----
    Mr. Harris. Okay. So it is even less than one-fifth of one 
percent?
    Secretary Chu. Yes.
    Mr. Harris. So this huge new energy source, the real 
breakthrough, the Department is spending one-fifth of one 
percent. All right. Well, your time is precious. I appreciate 
that. You can't spend all your time on everything, so I am 
going to ask you about this email--this June 2011 email where a 
Solyndra employee described what they learned from Bank of 
America financiers involved in that Prologis loan negotiation. 
A quote from the email is, ``on three occasions this week, he 
thought that the deal was dead but Secretary Chu''--so he being 
the financier--``but Secretary Chu personally pulled it off. 
Chu shared with the team that this deal went to higher levels 
in the Obama Administration to gain approval than any other 
transaction in the Loan Guarantee Program and that he 
personally committed to seeing it through to successful 
conclusion.'' Now, is that kind of true? I mean is what that 
person says kind of a realistic summary of what went on? And of 
course remembering that Prologis at that time was going to 
contract with Solyndra at a time when Solyndra was 
renegotiating its whole deal with the government and in fact 
got, you know, was secondary in--you know, that whole--and you 
know the whole deal. Is that a pretty accurate summary, that 
you were personally involved at a level different from other 
deals?
    Secretary Chu. I strongly supported the Prologis loan 
application because I thought it was a wonderful way of 
financing in a measured way--financing--letting warehouses use 
their rooftop space----
    Mr. Harris. Sure. Was there a breakthrough new technology 
involved?
    Secretary Chu. No.
    Mr. Harris. No, there was no breakthrough. And this was how 
big a loan guarantee?
    Secretary Chu. Well, it was going out in stages.
    Mr. Harris. Yeah, and what was the total? Wasn't it over a 
billion dollars?
    Secretary Chu. Pardon?
    Mr. Harris. Was it over a billion dollars?
    Secretary Chu. No, it was not a billion.
    Mr. Harris. And how--so how much total?
    Secretary Chu. I think $750 million.
    Mr. Harris. Oh, I am sorry, only three-quarters of a 
billion. Okay. So what specific actions did you take with 
regards to this loan different from the actions you took on 
other loans? Because, again, this is not breakthrough 
technology. And you know, I have been a supporter of ARPA-E. I 
think that is where the Department ought to be concentrating. 
So when it--so when things happened with Solyndra which, again, 
Solyndra is not breakthrough technology. Let's be honest. You 
know, hydrofracturing is breakthrough technology. Solyndra 
really was just, you know, a little bit better than what we 
have had. So what it appears has happened is that your time, 
which is of basic science, I would think would be saying, look, 
let's make some really innovative changes in energy. Instead, 
it appears to have been taken up to forward a deal where 
Solyndra is involved, where, you know, the objective person 
would look and say, you know, it looks kind of like what you 
are doing is you are, you know, saving Solyndra from an 
embarrassment to the Administration by in fact interjecting 
yourself into the Prologis negotiation at a different level 
than you have interjected yourself into any other one. And 
again that is what this person says.
    Secretary Chu. That is untrue. I----
    Mr. Harris. Which part?
    Secretary Chu. Solyndra--the fact that Solyndra had a 
minor, minor role in that--in fact, I was quite the opposite. I 
wanted Prologis. It was an innovation in a business model, as 
you know, can really revolutionize things. My concern was that 
we thought that--I thought that this was a very, very good 
business model to put wholesale generation of electricity on 
warehouse rooftops. My concern actually was to not having 
anything to do with the future of Solyndra--it was completely 
different. In fact, I voiced concerns; shouldn't we be looking 
for alternatives to Solyndra for the first little bit? And so 
it was quite the opposite from what might be portrayed.
    Mr. Harris. Did you attempt to stop the negotiation between 
Prologis and Solyndra?
    Secretary Chu. No. That was between two companies. But what 
I did raise is my concern that I wanted Prologis to go forward 
and was concerned if Solyndra could supply those things. But 
again the good news is that solar modules are essentially a 
commodity--and as the prices are going down--and the good news 
about this, again, is that the price of solar modules has 
dropped fourfold in the last three years.
    Mr. Harris. But Mr. Secretary, the cost is still far more 
because one of the statements--and Mr. Chairman, I will wrap it 
up--one of the statements in your testimony is that one goal is 
to bring down solar energy prices by the end of the decade to 
be the cheapest source of electricity.
    Secretary Chu. As cheap as any other source of energy.
    Mr. Harris. Correct. Now, Secretary Chu, at $2.50 a million 
BTU for natural gas, you really think that solar by the end of 
this decade, the point where you were unwilling to invest in 
natural gas, you still think that is the best investment we can 
do to keep our energy prices low in this country? You think you 
can achieve that at $2.50 a million cubic foot? And again since 
we are going to control it, it is not going to be at the 
vagaries of an international market to some extent.
    Secretary Chu. Well, if you look at projections made by, 
for example, the EIA or projections made by Bloomberg New 
Energy Finance, they are projecting the price of natural gas-
generated electricity be something on the scale of 5.5, 6 cents 
a kilowatt hour.
    Mr. Harris. Do you know what their projection is for 
natural gas last month? Their last projection from 2010 was 
where natural gas prices----
    Secretary Chu. I know what the Bloomberg New Energy 
Finance's projection for the cost of electricity from the 
generation of natural gas. That was first quarter 2012 and that 
is the one--the number----
    Mr. Harris. I will let you in on it. A year and a half ago, 
they projected--this is how good we are at projecting prices. 
They thought it was going to be $5 a million cubic foot. It is 
$2.50.
    Secretary Chu. Right.
    Mr. Harris. The Administration, at many different levels, 
is just behind the curve on this. But I respect you and I thank 
you for being here and I just hope that you take the view that 
natural gas is important enough to invest in it.
    Thank you very much.
    And thank you. I am sorry I ran way over, Mr. Chairman, but 
thank you for your indulgence.
    Chairman Hall. Well, at least you waited a long time to do 
it. Thank you for good questions, and thank you for your 
answers.
    And I indicated in an opening statement that I was going to 
answer Ms. Johnson but I know when I am overmatched. I am going 
to put something in the record if she doesn't object to it. It 
is the primary scenario and the analysis I am asking to put in 
the record was by Senator Bingaman. It was in the Senate and 
shows electricity prices would rise nationally by 21 percent in 
2035 and regionally by as much as 69 percent. That is one 
person in one body's idea on it. And without objection, I want 
to put this into the record. It is so ordered.
    [The information may be found in Appendix 2.]
    Chairman Hall. And I want to thank you very much. I don't 
sound like I appreciate you near as much as I do, but you have 
answered our questions and we have agreed and disagreed. You 
said that the pipeline wasn't cancelled but its head is down in 
the water and it's down there bubbling and it is going to drown 
if--you give me hope that he is going to reconsider and I am--
between the two of us here, I am going to make you a prediction 
if you don't mind, and you can hold me to it. I think this 
President is going to listen to the American people and I hope 
he does. I think he is political enough to. I predict he is 
going to recapture this pipeline for us because it is the thing 
that he ought to do and the people are going to demand it. And 
I think he is going to do that.
    I also think where he knocked out ANWR--and that is 60 
years of energy--quickly did that and it has been going down 
every since, really and truly that is a hard, cold fact. I 
predict that we are going to--he is going to open up some 
drilling because the people are going to demand it, and the 
President is very political. I think he is going to answer. I 
predict that he is going to. Now, I owe you a beer or a dinner 
or whatever if my predictions are wrong, but maybe you will owe 
me one if I am right, okay?
    Secretary Chu. I would be glad to share a beer with you.
    Chairman Hall. All right. I thank you, of course, for your 
very valuable testimony and Members for their questions.
    And Members of the Committee might have additional 
questions for you, Mr. Secretary, and we will ask you to 
respond to those in writing. And the record will remain open 
for two weeks for additional comments from Members.
    I thank all of you for your patience. Thank you, Ms. 
Johnson, for your good work and your good questions. And once 
again, Mr. Chairman, thank you and God bless you. Thank you, 
sir.
    Secretary Chu. Thank you.
    Chairman Hall. We are adjourned.
    [Whereupon, at 12:04 p.m., the Committee was adjourned.]

                   Answers to Post-Hearing Questions




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

Questions Submitted by Chairman Ralph M. Hall,

Committee on Science, Space and Technology


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