[House Hearing, 112 Congress]
[From the U.S. Government Publishing Office]
H.R. 4255, THE ACCOUNTABILITY IN GRANTS ACT OF 2012
=======================================================================
HEARING
BEFORE THE
SUBCOMMITTEE ON ENERGY AND POWER
OF THE
COMMITTEE ON ENERGY AND COMMERCE
HOUSE OF REPRESENTATIVES
ONE HUNDRED TWELFTH CONGRESS
SECOND SESSION
__________
SEPTEMBER 11, 2012
__________
Serial No. 112-173
Printed for the use of the Committee on Energy and Commerce
energycommerce.house.gov
U.S. GOVERNMENT PRINTING OFFICE
82-931 WASHINGTON : 2013
-----------------------------------------------------------------------
For sale by the Superintendent of Documents, U.S. Government Printing
Office Internet: bookstore.gpo.gov Phone: toll free (866) 512-1800; DC
area (202) 512-1800 Fax: (202) 512-2104 Mail: Stop IDCC, Washington, DC
20402-0001
COMMITTEE ON ENERGY AND COMMERCE
FRED UPTON, Michigan
Chairman
JOE BARTON, Texas HENRY A. WAXMAN, California
Chairman Emeritus Ranking Member
CLIFF STEARNS, Florida JOHN D. DINGELL, Michigan
ED WHITFIELD, Kentucky Chairman Emeritus
JOHN SHIMKUS, Illinois EDWARD J. MARKEY, Massachusetts
JOSEPH R. PITTS, Pennsylvania EDOLPHUS TOWNS, New York
MARY BONO MACK, California FRANK PALLONE, Jr., New Jersey
GREG WALDEN, Oregon BOBBY L. RUSH, Illinois
LEE TERRY, Nebraska ANNA G. ESHOO, California
MIKE ROGERS, Michigan ELIOT L. ENGEL, New York
SUE WILKINS MYRICK, North Carolina GENE GREEN, Texas
Vice Chairman DIANA DeGETTE, Colorado
JOHN SULLIVAN, Oklahoma LOIS CAPPS, California
TIM MURPHY, Pennsylvania MICHAEL F. DOYLE, Pennsylvania
MICHAEL C. BURGESS, Texas JANICE D. SCHAKOWSKY, Illinois
MARSHA BLACKBURN, Tennessee CHARLES A. GONZALEZ, Texas
BRIAN P. BILBRAY, California TAMMY BALDWIN, Wisconsin
CHARLES F. BASS, New Hampshire MIKE ROSS, Arkansas
PHIL GINGREY, Georgia JIM MATHESON, Utah
STEVE SCALISE, Louisiana G.K. BUTTERFIELD, North Carolina
ROBERT E. LATTA, Ohio JOHN BARROW, Georgia
CATHY McMORRIS RODGERS, Washington DORIS O. MATSUI, California
GREGG HARPER, Mississippi DONNA M. CHRISTENSEN, Virgin
LEONARD LANCE, New Jersey Islands
BILL CASSIDY, Louisiana KATHY CASTOR, Florida
BRETT GUTHRIE, Kentucky JOHN P. SARBANES, Maryland
PETE OLSON, Texas
DAVID B. McKINLEY, West Virginia
CORY GARDNER, Colorado
MIKE POMPEO, Kansas
ADAM KINZINGER, Illinois
H. MORGAN GRIFFITH, Virginia
7_____
Subcommittee on Energy and Power
ED WHITFIELD, Kentucky
Chairman
JOHN SULLIVAN, Oklahoma BOBBY L. RUSH, Illinois
Vice Chairman Ranking Member
JOHN SHIMKUS, Illinois KATHY CASTOR, Florida
GREG WALDEN, Oregon JOHN P. SARBANES, Maryland
LEE TERRY, Nebraska JOHN D. DINGELL, Michigan
MICHAEL C. BURGESS, Texas EDWARD J. MARKEY, Massachusetts
BRIAN P. BILBRAY, California ELIOT L. ENGEL, New York
STEVE SCALISE, Louisiana GENE GREEN, Texas
CATHY McMORRIS RODGERS, Washington LOIS CAPPS, California
PETE OLSON, Texas MICHAEL F. DOYLE, Pennsylvania
DAVID B. McKINLEY, West Virginia CHARLES A. GONZALEZ, Texas
CORY GARDNER, Colorado HENRY A. WAXMAN, California (ex
MIKE POMPEO, Kansas officio)
H. MORGAN GRIFFITH, Virginia
JOE BARTON, Texas
FRED UPTON, Michigan (ex officio)
(ii)
C O N T E N T S
----------
Page
Hon. Ed Whtifield, a Representative in Congress from the
Commonwealth of Kentucky, opening statement.................... 1
Prepared statement........................................... 3
Hon. Bobby L. Rush, a Representative in Congress from the State
of Illinois, opening statement................................. 7
Hon. Fred Upton, a Representative in Congress from the State of
Michigan, opening statement.................................... 8
Prepared statement........................................... 10
Hon. Joe Barton, a Representative in Congress from the State of
Texas, opening statement....................................... 11
Hon. Henry A. Waxman, a Representative in Congress from the State
of California, opening statement............................... 11
Witnesses
Craig E. Hooks, Assistant Administrator for Administration and
Resources Management, Environmental Protection Agency.......... 71
Prepared statement........................................... 73
Answers to submitted questions............................... 164
Daniel Simmons, Director of Regulatory and State Affairs,
Institute for Energy Research.................................. 90
Prepared statement........................................... 93
Andrew Light, Senior Fellow, Center for American Progress, and
Associate Director, Institute for Philosophy and Public Policy,
George Mason University........................................ 102
Prepared statement........................................... 105
Answers to submitted questions............................... 171
Elisa Derby, Senior Program Officer, Winrock International....... 125
Prepared statement........................................... 127
Answers to submitted questions............................... 174
David W. Kreutzer, Research Fellow in Energy Economics and
Climate Change, The Heritage Foundation........................ 143
Prepared statement........................................... 145
Submitted Material
H.R. 4255, the Accountability in Grants Act of 2012, submitted by
Mr. Whitfield.................................................. 5
Memorandum, dated September 11, 2012, Re: Supplemental
Information on EPA's International Grantmaking, with
supplemental material, submitted by Mr. Waxman................. 13
Statement, dated September 11, 2012, of Nan Swift, Federal
Affairs Manager, National Taxpayers Union, submitted by Mr.
Whitfield...................................................... 159
Letter, dated April 9, 2012, from Thomas A. Schatz, President,
Council for Citizens Against Government Waste, to
Representatives in Congress, submitted by Mr. Whitfield........ 163
H.R. 4255, THE ACCOUNTABILITY IN GRANTS ACT OF 2012
----------
Tuesday, September 11, 2012
House of Representatives,
Subcommittee on Energy and Power,
Committee on Energy and Commerce,
Washington, DC.
The subcommittee met, pursuant to call, at 10:20 a.m., in
room 2123 of the Rayburn House Office Building, Hon. Ed
Whitfield (chairman of the subcommittee) presiding.
Members present: Representatives Whitfield, Walden, Terry,
Burgess, Bilbray, Scalise, Olson, McKinley, Pompeo, Griffith,
Barton, Upton (ex officio), Rush, and Waxman (ex officio).
Staff present: Gary Andres, Staff Director; Anita Bradley,
Senior Policy Advisor to Chairman Emeritus; Allison Busbee,
Legislative Clerk; Andy Duberstein, Deputy Press Secretary;
Cory Hicks, Policy Coordinator, Energy and Power; Heidi King,
Chief Economist; Ben Lieberman, Counsel, Energy and Power; Mary
Neumayr, Senior Energy Counsel; Phil Barnett, Democratic Staff
Director; Alison Cassady, Democratic Senior Professional Staff
Member; Greg Dotson, Democratic Energy and Environment Staff
Director; Caitlin Haberman, Democratic Policy Analyst; and
Karen Lightfoot, Democratic Communications Director and Senior
Policy Advisor.
OPENING STATEMENT OF HON. ED WHITFIELD, A REPRESENTATIVE IN
CONGRESS FROM THE COMMONWEALTH OF KENTUCKY
Mr. Whitfield. I would like to call this hearing to order
this morning.
Today, we are going to have a legislative hearing on H.R.
4255, the Accountability and Grants Act, which was introduced
recently. And I might say that all of us when we are back home
in our districts hear people talk all the time about the
Federal debt. And as you know, it is now around $16 trillion.
And they are always asking the question, why is it that you all
in Washington cannot seem to ever get spending under control?
And we all know that there is not one piece of legislation that
is going to solve that problem. But this is one piece of
legislation that many of us believe is a small step in the
right direction, and it does involve real money, but in many
ways I think we could say that it is really a symbolic gesture
that does save money.
Now, our friends on the other side of the aisle had a memo
that they sent out on this legislation and it says, ``the data
does not support the majority's assertions that the Obama
administration has intensified grant-making from EPA for
international activities that do not benefit the American
people.'' Well, I would say, first of all, I introduced this
legislation and I never asserted that the Obama administration
intensified grant-making for international activities. I am
simply saying that ever since the Clean Air Act was written,
this Section 1703 has been in there allowing money to be spent
for international purposes through grants out of EPA. And the
Bush administration did it, Obama administration did it, the
Clinton administration did it, so everyone is doing it.
But the purpose of this legislation is simply to take one
small step to show the American people that at this time in our
Nation's history when we have a $16 trillion Federal debt that,
yes, at least temporarily, let us stop international grant-
making through EPA. And I am not even going to argue that there
hasn't been some benefit in these grants. But I would argue
that, right now, one of the major factors facing our country is
a debt load that we cannot continue with over the long-term. So
if we cannot pass a piece of legislation like this, then I
would say our opportunities of trying to curtail this debt is
almost hopeless.
So this bill is limited in scope and applies only to grants
and other financial assistance under Section 103 of the Clean
Air Act, which authorizes the administrator to undertake
certain research, investigation, and training. Now, we know
that the money has gone to the Chinese for swine study, we know
money has gone to the Ukraine, has gone to Polish
municipalities regarding landfill gas, we know it has gone to
Indonesia, we know a lot of it has gone to the United Nations,
and all of these projects may be perfectly fine, but when we
have this kind of debt, we are simply trying to make a
statement--let us curtail this for a period of time. And that
is what this legislation is designed to do.
And as we go through this hearing, we will get more into
the specifics of it. But I would reiterate once again certainly
not my purpose, not my intent to try to jump on the Obama
administration for doing this. This is a government program
that has gone on for too long. At this time, we think it should
be halted. So that is what it is all about.
And at this time, I would yield to the distinguished
gentleman from Illinois, Mr. Rush.
[The prepared statement of Mr. Whitfield and H.R. 4255
follow:]
[GRAPHIC] [TIFF OMITTED] 82931.001
[GRAPHIC] [TIFF OMITTED] 82931.002
[GRAPHIC] [TIFF OMITTED] 82931.003
[GRAPHIC] [TIFF OMITTED] 82931.004
OPENING STATEMENT OF HON. BOBBY L. RUSH, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF ILLINOIS
Mr. Rush. Thank you, Mr. Chairman.
Well, I tell you, Mr. Chairman, in my 20 years in this
Congress, I have never seen nor heard of anything that is so
shallow, any legislation that appeared before any committee in
the Congress that is so shallow, so ill-informed, so misplaced
than this piece of legislation that we are wasting the
taxpayers' money on right now by even considering this
headline-grabbing attempt by your side to, one more time, cast
the Obama administration in an ugly light.
Mr. Chairman, we have been having hearings and you seem to
know we are presiding again as one of the most ineffective and
unproductive sessions of this subcommittee in recent years, and
I thought that maybe over the summer, especially when we are
under a new decorum here, I thought that at least we would have
a different kind of attitude after the summer recess.
But Mr. Chairman, I want to remind you that it has been a
year now and Republicans on this subcommittee have passed
message vote after message vote and they have brought up a
variety of useless deals expressing some kind of dislike over
the EPA, the Clean Air Act, and again the Obama administration.
And this bill, I must remind you or predict that it is headed
straight to the legislative scrap pile, a scrap heap where all
legislation like this usually ends up. And this bill is not
aimed at producing not one job for the American people or it is
not aimed at moving our country's energy policy forward not
even one iota, one scintilla.
Today, we are having this hearing and trying to keep the
EPA from awarding grants or contracts or partnerships in
foreign countries that could be used to address global issues,
not just issues that we are not affected by. These are global
issues that most of this money goes toward, issues like climate
change. Mr. Chairman, climate change doesn't just affect your
constituents in Kentucky or my constituents in Illinois. We are
living in a global environment and climate change affects all
of us. Mercury emissions and things, all of us, they don't have
any kind of consideration for national waters.
Mr. Chairman, again, we are trying to embarrass the
administration and we are going about this absolutely wrong.
There are some facts--you might not want to hear them--but
there are some facts. You know, the data provided by the EPA to
this subcommittee shows that under President Obama, the EPA
grants have resulted in less spending abroad than in the last
year of the Bush administration. Foreign expenditures covered
by the EPA grants total $8.5 million in 2008 and declined to $6
million in 2011. Mr. Chairman, you might not want the American
people to know, but I am going to tell them that most of this
money of these grants, they don't go outside of the shores of
this Nation. This money is spent right here at home at our
universities, our research centers. These grants help keep
American scientists and American students busy, keep them
working. This is certainly not a boondoggle for some foreign
government.
Mr. Chairman, I think that we are really way off base with
this. This would be laughable if it was not so serious in that
we are wasting precious taxpayer dollars on this shallow non-
productive hearing on this bill that I guarantee you will not
see the light of day.
I yield back.
Mr. Whitfield. Thank you very much, Mr. Rush.
At this time, I recognize the gentleman from Michigan, Mr.
Upton, for 5 minutes.
OPENING STATEMENT OF HON. FRED UPTON, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF MICHIGAN
Mr. Upton. Well, thank you, Mr. Chairman.
Today, as we know, we are going to be discussing H.R. 4255,
the Accountability in Grants Act of 2012, which prohibits EPA
from awarding grants to foreign countries under the Clean Air
Act.
Over the past 18 months, this committee has held numerous
hearings on various actions taken by the EPA, and one recurring
theme throughout our oversight is that the Agency has strayed
away from its core mission. In fact, EPA is pursuing a wide-
ranging agenda that is neither specified nor required under the
Clean Air Act. One example is the Agency's war on coal. EPA has
no statutory authority to set America's energy policy, yet the
Agency has embarked on a multi-pronged agenda to regulate coal
out of existence. We will continue to push back hard against
this anti-coal effort to protect jobs and ensure Americans
continue to have access to affordable electricity.
But today, we are addressing another one of the Agency's
questionable activities--the sending of millions of dollars in
grants overseas, particularly those grants awarded under
Section 103 of the Clean Air Act. There is nothing in the Clean
Air Act directing the EPA to send tax dollars abroad, and the
American people would not be pleased to know we are subsidizing
foreign projects at a time when millions of Americans are out
of work and the national debt has now eclipsed $16 trillion.
While the practice of awarding such grants to foreign
recipients did not begin with this EPA, it is under this
administration that foreign grant spending has nearly doubled.
The Agency doled out nearly $12 million in foreign grants in
'09, $22 million in 2010, $28 million in 2011. It is a
disturbing trend that won't stop unless we do something about
it.
It is not merely an issue of money. In fact, many of these
foreign grants raise questions for reasons that go well beyond
the dollars and cents. Some of the grants go to countries like
China, Russia, Brazil who rank among the largest foreign
holders of U.S. treasury securities. In the case of China, we
are talking about a country that holds more than a trillion
dollars in U.S. debt, so we have the odd situation of borrowing
money from a country and then giving back some of it in grants.
Several grants go to foreign countries to help their
industries deal with various pollution issues, but many of
these foreign energy producers and manufacturers are in direct
competition with their American counterparts. The fact that the
very same EPA that is strangling our domestic industry with
regulatory red tape is also sending checks that assist foreign
competitors raises questions as well. In addition, many of
these grants seem downright outlandish--$450,000 for the
``Breathe Easy, Jakarta'' initiative. Somehow this spending has
got to come to an end.
The Accountability in Grants Act would prohibit any more
American tax dollars from being used under Section 103 of the
Clean Air Act for purposes outside of the U.S. In doing so, the
bill will save taxpayer dollars and force the administration to
focus on actual responsibilities here at home.
And I yield back to Mr. Barton.
[The prepared statement of Mr. Upton follows:]
[GRAPHIC] [TIFF OMITTED] 82931.005
OPENING STATEMENT OF HON. JOE BARTON, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF TEXAS
Mr. Barton. Well, thank you, Chairman Upton, and thank you,
Chairman Whitfield, for scheduling a legislative hearing on
H.R. 4255.
During the EPA budget hearing back last spring, we asked a
number of questions which were related to how the EPA was
spending taxpayer monies at what would appear to be breakneck
speeds. The economy is still struggling, although it is
somewhat better, this Congress is facing some of the most
difficult spending decisions in our history. As we all know,
very soon, we are going to have to take up a bill to determine
whether we want to allow the sequester to go forward or if we
want to change it in some way.
The Clean Air Act does allow EPA to issue grants to
projects both here in the United States and around the world.
Subcommittee staff have discovered that over 300 grants have
been given to projects around the world in the last number of
years. Since 2009, for example, we had almost $1 million that
was given to China to study air pollution in that country,
$200,000 to study something called ``clean cooking'' in
Ethiopia, and $300,000 went towards methane recovery in
Ecuador, just for example. We even sent almost $8 million for
something called ``technical assistance'' in Russia. Several
million dollars have gone to international groups such as
United Nations. It is no wonder that the EPA's budget has gone
up almost 34 percent during the Obama administration and is now
over $10 billion per year.
I don't believe, Mr. Chairman, that this type of spending
reflects the priorities of the average American voter that vote
for us to come to Washington. I just finished almost a dozen
town hall meetings in my district down in Texas during August.
Not once did I have a constituent stand up and tell me to spend
more money for EPA grants overseas.
So I am very glad, Mr. Chairman, that you put this bill
forward and I hope on a bipartisan basis we can move it very
expeditiously to full committee and then to the floor.
With that, I yield back.
Mr. Whitfield. Thank you very much.
At this time, I recognize the gentleman from California,
Mr. Waxman, for 5 minutes.
OPENING STATEMENT OF HON. HENRY A. WAXMAN, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF CALIFORNIA
Mr. Waxman. Thank you, Mr. Chairman.
I note that the committee Republicans launched an
investigation into EPA's long-standing practice of awarding
grants for work abroad. This investigation was commenced last
summer and the Republicans released a staff report saying that
President Obama had doled out millions of dollars to foreign
recipients. But this report was seriously flawed. Half of the
grants they criticized President Obama for awarding actually
started under the George W. Bush administration.
So I wrote to Chairman Upton and Chairman Whitfield and
explained that their report was incorrect, asked them to
retract that report until they reviewed the facts more
carefully. What do they do? They ignore the letter, just as
they have been ignoring a lot of letters. EPA then provided the
committee with a comprehensive list of 500 grants awarded in
the last 10 years for projects with an international component.
Republicans have used this data to argue the Obama
administration has increased grant funding for foreign
projects. In fact, almost half of these grants went to U.S.-
based university organizations, not foreign recipients, and
many had only the most minor international connection.
EPA calls a grant ``international'' if the grantee spends
any money abroad at all, even if it is just to fly to a
conference in a different country to get the perspectives of
international experts. One grant on the list went to the
University of Pittsburgh for research into air pollution in New
York City. EPA Administrator Jackson explained this to the
committee last February. She testified that very little of the
money categorized as international actually went abroad.
Well, after that hearing, we sent another letter to
Chairman Whitfield raising concerns about how the committee
Republicans were portraying EPA's international grant-making
activities. Again, we didn't get a response. So we decided to
ask EPA to tell us how much money the grantees actually spent
abroad. And based on that data, we found that EPA grantees have
spent less abroad on average in the Obama administration than
they did during the last year of the Bush administration.
And I would like to introduce into the record a
supplemental memo that explains the reality of EPA's
international grants program. And I hope, Mr. Chairman, without
objection you will take that into the record.
Mr. Whitfield. Without objection.
[The information follows:]
[GRAPHIC] [TIFF OMITTED] 82931.006
[GRAPHIC] [TIFF OMITTED] 82931.007
[GRAPHIC] [TIFF OMITTED] 82931.008
[GRAPHIC] [TIFF OMITTED] 82931.009
[GRAPHIC] [TIFF OMITTED] 82931.010
[GRAPHIC] [TIFF OMITTED] 82931.011
[GRAPHIC] [TIFF OMITTED] 82931.012
[GRAPHIC] [TIFF OMITTED] 82931.013
[GRAPHIC] [TIFF OMITTED] 82931.014
[GRAPHIC] [TIFF OMITTED] 82931.015
[GRAPHIC] [TIFF OMITTED] 82931.016
[GRAPHIC] [TIFF OMITTED] 82931.017
[GRAPHIC] [TIFF OMITTED] 82931.018
[GRAPHIC] [TIFF OMITTED] 82931.019
[GRAPHIC] [TIFF OMITTED] 82931.020
[GRAPHIC] [TIFF OMITTED] 82931.021
[GRAPHIC] [TIFF OMITTED] 82931.022
[GRAPHIC] [TIFF OMITTED] 82931.023
[GRAPHIC] [TIFF OMITTED] 82931.024
[GRAPHIC] [TIFF OMITTED] 82931.025
[GRAPHIC] [TIFF OMITTED] 82931.026
[GRAPHIC] [TIFF OMITTED] 82931.027
[GRAPHIC] [TIFF OMITTED] 82931.028
[GRAPHIC] [TIFF OMITTED] 82931.029
[GRAPHIC] [TIFF OMITTED] 82931.030
[GRAPHIC] [TIFF OMITTED] 82931.031
[GRAPHIC] [TIFF OMITTED] 82931.032
[GRAPHIC] [TIFF OMITTED] 82931.033
[GRAPHIC] [TIFF OMITTED] 82931.034
[GRAPHIC] [TIFF OMITTED] 82931.035
[GRAPHIC] [TIFF OMITTED] 82931.036
[GRAPHIC] [TIFF OMITTED] 82931.037
[GRAPHIC] [TIFF OMITTED] 82931.038
[GRAPHIC] [TIFF OMITTED] 82931.039
[GRAPHIC] [TIFF OMITTED] 82931.040
[GRAPHIC] [TIFF OMITTED] 82931.041
[GRAPHIC] [TIFF OMITTED] 82931.042
[GRAPHIC] [TIFF OMITTED] 82931.043
[GRAPHIC] [TIFF OMITTED] 82931.044
[GRAPHIC] [TIFF OMITTED] 82931.045
[GRAPHIC] [TIFF OMITTED] 82931.046
[GRAPHIC] [TIFF OMITTED] 82931.047
[GRAPHIC] [TIFF OMITTED] 82931.048
[GRAPHIC] [TIFF OMITTED] 82931.049
[GRAPHIC] [TIFF OMITTED] 82931.050
[GRAPHIC] [TIFF OMITTED] 82931.051
[GRAPHIC] [TIFF OMITTED] 82931.052
[GRAPHIC] [TIFF OMITTED] 82931.053
[GRAPHIC] [TIFF OMITTED] 82931.054
[GRAPHIC] [TIFF OMITTED] 82931.055
[GRAPHIC] [TIFF OMITTED] 82931.056
[GRAPHIC] [TIFF OMITTED] 82931.057
[GRAPHIC] [TIFF OMITTED] 82931.058
[GRAPHIC] [TIFF OMITTED] 82931.059
[GRAPHIC] [TIFF OMITTED] 82931.060
[GRAPHIC] [TIFF OMITTED] 82931.061
[GRAPHIC] [TIFF OMITTED] 82931.062
Mr. Waxman. This hearing and the bill we are considering
are a good illustration of what is wrong with this committee.
Facts don't seem to matter. This bill proves that poor
oversight leads to dumb legislation.
There is another problem with this bill. Its entire premise
is that the U.S. engagement with the rest of the world on
environmental issues is wrong. We don't have enough money to
send to those foreigners. That is the line we are hearing from
the other side of the aisle. Well, the United States does not
exist in a bubble. Pollution doesn't respect national borders.
Pollution does not need a passport. That is why sustained U.S.
international engagement by EPA and other Federal agencies is
essential.
When we wanted EPA to crack down on U.S. emissions of
greenhouse gases, Republicans said it wouldn't do any good. We
need an international response. Unilateral climate change would
harm U.S. competitiveness. They say they want an international
solution, but when EPA makes a grant to build global support
for reducing emissions of methane or black carbon, which
contribute to climate change, the same Members attack EPA for
spending U.S. funds abroad. It is a cynical Catch-22.
Committee Republicans ridicule ``Breathe Easy, Jakarta''--
this is their press release--for its name, but ignore that this
modest $15,000 will help the Indonesian city transition away
from leaded gasoline. They ignore the benefit of providing
funding for cleaner cookstoves so that poor women and children
in Haiti and other developing countries aren't exposed to
deadly indoor air pollution. Well, no one at Mr. Barton's town
hall meeting said they wanted it, but if they knew about it, I
would think they would support it. We want to protect kids in
other countries and help other countries protect their
population from air pollution that causes mental retardation.
One of our greatest strengths as Americans is our
generosity to those in need. Sadly, we seem to regard
compassion to the needy as a weakness, not a virtue, on this
committee.
And I want to add, even though my time is expired, that
painting this room green does not make this committee green.
And I otherwise will privately tell the chairman how ugly I
think the walls are, but I don't want to say that publicly.
I yield back my time.
Mr. Whitfield. I didn't have anything to do with the color
of these walls. Well, thank you very much for your opening
statement.
Mr. Hooks, we genuinely appreciate your being with us this
morning, and I am reluctant to say that, not infrequently, we
have to delay hearings for one reason or the other. And today,
we are having a memorial service for the 9/11 victims in the
Capitol that begins in a few minutes. So we are going to recess
this hearing until 11:30. And I hope that is not too much of an
inconvenience for you. But we do look forward to your
testimony.
And we will recess the hearing, then, until 11:30. And I
know we have other witnesses after that and I hope that you all
will bear with us because we do look forward to your testimony.
And we will reconvene at 11:30.
So at this time, the hearing is recessed.
[Recess.]
Mr. Whitfield. Thank you very much for being with us this
morning, and we look forward to your testimony. And I will
recognize you for 5 minutes for your opening statement, and
then at the end of that time we will have questions for you.
And Mr. Rush is here but he is in the anteroom. He will be
right in but in the meantime we would like for you to go on and
get started.
STATEMENT OF CRAIG E. HOOKS, ASSISTANT ADMINISTRATOR FOR
ADMINISTRATION AND RESOURCES MANAGEMENT, ENVIRONMENTAL
PROTECTION AGENCY
Mr. Hooks. Chairman Whitfield, Ranking Member Rush, and
members of the subcommittee, Mr. Chairman, thank you for the
opportunity to testify today on H.R. 4255. This bill would
prohibit the EPA from awarding grants under the Clean Air Act,
Section 103, for any program, project, or activity, outside of
the United States.
Since 1972, administrations of both parties have used
international grants awarded by EPA to support public health
and environmental protection globally. These grants comprise a
very small percentage of EPA's grant budget and are supported
in part with appropriations from other agencies. Most of this
money is spent here in the United States. In fact, from fiscal
year 2008 through 2010, about \2/3\ of the total awarded
through grants designated as international was allocated for
work here in the United States.
While EPA's investment in international grants is small,
these grants support efforts to reduce trans-boundary and
global environmental threats to the United States, reducing the
cost and increasing the effectiveness of the Nation's
environmental protection. They also serve broader U.S. foreign
policy and economic interest.
Section 103 grants are a key component of EPA's
international grant portfolio. Among the programs supported
with Section 103 grants that would be adversely impacted by
H.R. 4255 are the Partnership for Clean Indoor Air, or PCIA,
and the Partnership for Clean Fuels in Vehicles. These programs
were launched by the Bush administration in 2002.
The PCIA addresses the burning of solid fuels for household
cooking and heating. Over half of the world's population uses
these fuels, which cause indoor air pollution resulting in
premature deaths of more than 2 million people annually.
The PCFV reduces air pollution in developing and
transitional companies by promoting the use of lead-free and
low sulfur fuels and clean vehicles. These programs have
produced outstanding results. The PCIA through EPA grants and
other activities has enabled at least 9.3 million households to
adopt cleaner technologies and fuels improving the health and
livelihood of 52.4 million people in developing countries.
Similarly, the Partnership for Clean Fuels in Vehicles has
contributed to more than 180 countries eliminating lead from
fuels and opened international markets to American
manufacturers of advanced air pollution control equipment.
This legislation would also inhibit EPA's ability to
address overseas emissions of toxic mercury pollution. When
mercury deposition is highest in the United States, domestic
sources are the largest contributors. However, mercury in the
atmosphere can be transported globally. In much of the U.S.,
mercury from global sources dominates the deposition.
Furthermore, much of the marine fish that Americans consume
comes from waters far from our shores. Therefore, to fully
protect Americans from toxic effects of mercury contamination,
a global effort is required. EPA has provided funding under
Section 103 to the United Nations' Environmental Program to
support efforts to reduce mercury use in products and
manufacturing processes, as well as mercury emissions in the
atmosphere from a variety of sources.
H.R. 4255 would also adversely impact the Global Methane
Initiative, or GMI, a program initiated under the Bush
administration to reduce methane emissions. Methane is a potent
greenhouse gas and contributes to the formation of tropospheric
ozone, an air pollutant that is transported across borders and
causes significant health problems in the U.S. and around the
world. Under the GMI, EPA's Section 103 grants support work
with 41 countries, international financial institutions, and
hundreds of private sector organizations to reduce methane
emissions. GMI grants have directly provided over $2.7 million
in benefits to U.S. companies, universities, and nonprofit
organizations. These grants have created significant market
opportunities for U.S. technologies, goods, and services. In
total, U.S. support for GMI has leveraged more $398 million in
additional investment in methane-reducing projects around the
globe.
Countries need adequate governmental structures to enforce
environmental standards. This can benefit U.S. companies by
helping to ensure that foreign companies are subject to similar
regulatory requirements. H.R. 4255 would hinder our ability to
promote strong governance that continued award of Section 103
grants that assist U.S. trading partners in developing
effective institutions.
Finally, H.R. 4255 would inhibit international scientific
collaboration that strengthens the quality of EPA-supported
research by prohibiting travel of Section 103 grant-funded
scientists to attend international meetings or work with
scientists at foreign institutions. Such a limitation would
conflict with well established international collaboration
practices of Federal science agencies.
Section 103 grants play an important role in improving the
quality of the U.S. and the world environment providing
business opportunities for U.S. companies and supporting U.S.
foreign policy interests. The EPA believes that H.R. 42 would
cripple the Agency's ability through grants to address harmful
air pollutants that affect both the global and domestic
environment.
Thank you for inviting me here today and I look forward to
answering any of your questions.
[The prepared statement of Mr. Hooks follows:]
[GRAPHIC] [TIFF OMITTED] 82931.063
[GRAPHIC] [TIFF OMITTED] 82931.064
[GRAPHIC] [TIFF OMITTED] 82931.065
[GRAPHIC] [TIFF OMITTED] 82931.066
[GRAPHIC] [TIFF OMITTED] 82931.067
[GRAPHIC] [TIFF OMITTED] 82931.068
[GRAPHIC] [TIFF OMITTED] 82931.069
Mr. Whitfield. Thanks, Mr. Hooks, very much.
I will recognize myself for 5 minutes and then we will give
other Members an opportunity.
Has the EPA taken a formal position on opposing or
supporting the legislation? I know you said it would cripple
the Agency so I am assuming you are not going to support it,
but have you adopted a formal position of opposition to it?
Mr. Hooks. We have not adopted a formal opposition to this
proposed legislation, no, sir.
Mr. Whitfield. OK. Now, these 103 grants have certainly
been in the Clean Air Act for many years, and as of the end of
last year, at least from the information I was able to obtain
from EPA, there was not any formal agenda or procedure for
determining how these grants would be made. Do you all have a
formal procedure adopted at EPA on how the decision will be
made on these grants?
Mr. Hooks. The majority of our grants are actually awarded
competitively. International entities have the ability to
compete for certain grants. In these instances, they were
awarded through a competitive process.
Mr. Whitfield. OK. The reason I was asking the question, we
had received recently a grants policy issuance, GPI 1204, award
and administration of foreign grants, and I was just wondering,
is this an official document of EPA and do you know what I am
talking about or have you seen it?
Mr. Hooks. Yes, I do. We periodically actually review our
internal grant policies and create additional guidance as
necessary to ensure consistent management or assistance
agreements for all types of award recipients. Separate and
apart from the subcommittee's investigation, we had already
identified updating our awards for entities as a priority for
this fiscal year.
Mr. Whitfield. OK. Now, when we have looked at Section 103
of the Clean Air Act and you read that in its entirety, there
is not any mention whatsoever of any grant for international
purposes. So what is the legal authority of EPA for making
these grants?
Mr. Hooks. Actually, I believe there is a couple of
authorities that provide our ability to award these grants. We
use Section 103(a) and Section 103(b), but in addition to that,
we actually refer to Section 102(f) of NEPA, the National
Environmental Policy Act.
Mr. Whitfield. So you do rely on 103(a) and 103(b) as well?
Mr. Hooks. Correct.
Mr. Whitfield. What specific language?
Mr. Hooks. Well, maybe it is specific language by omission
as opposed to directly--it does not state directly
international entities. However, it does say that it directs
EPA to establish national research and development program,
including for any activities related to the prevention of
control of air pollution.
Mr. Whitfield. Yes.
Mr. Hooks. Given the trans-boundary and international
nature of air pollution, we think it provides us the authority
to deal with air pollution issues at its source as well.
Mr. Whitfield. Do you need the NEPA authority, then, if you
have 103(a) and (b)? Do you need NEPA authority?
Mr. Hooks. It is just an additional authority that we use
in this instance.
Mr. Whitfield. OK. So under NEPA, then, there are various
Federal agencies that have the authority--at least that you
all's position--to make these international grants?
Mr. Hooks. Correct.
Mr. Whitfield. OK. OK. In order for any of the above
statutes to apply internationally, they must be supplemented by
NEPA 102(a). OK--102(f). All right. Now, where is that
executive order that we were looking at a while ago? You know,
as I said in my opening statement, you know, one of the
concerns that we have, it is not that the Obama administration
is doing any more than anyone else, although the total amount
of grants from 2008 through 2011 is 78 million and in 2011 it
was over 28 million, and in 2010 over 22 million, and I know
not all of that has been identified as specifically for
international, but as we are dealing with this debt, the reason
we are focusing on this is that, you know, I think it is
helpful--I think it is healthy to look at the agencies and they
are spending--for example, China alone through this program has
received over 3 or $4 million over the last 2 or 3 years.
Mr. Hooks. Um-hum.
Mr. Whitfield. And as you know, we are borrowing a lot of
money from China to turn around and give them money back.
So my time is expired, but at this time I recognize Mr.
Rush for 5 minutes.
Mr. Rush. Thank you, Mr. Hooks. Let us talk about China and
the Obama administration in terms of sending checks to China.
Can you tell me for the record were the majority of the funds
from the international grants remain inside the U.S. or most of
the money is sent overseas?
Mr. Hooks. Right, the majority of our international grants
as they have been defined are spent here in the United States.
Mr. Rush. By whom and for what?
Mr. Hooks. Principally, through private industry. It can
also go to universities and nonprofits. The majority go to
universities and nonprofits.
Mr. Rush. For what?
Mr. Hooks. To do a variety of things through a variety of
very outstanding programs. The Global Methane Initiative which
was launched back in 2004 is designed to reduce the amount of
methane in our environment. The Clean Fuels and Vehicles
Program designed to reduce leaded gasoline and low sulfur
fuels. And Partnership for Clean Indoor air is designed to
reduce the amount of exposure to wood stoves.
Mr. Rush. Um-hum. Are you aware of any other nations having
similar international obligation or international needs as it
relates to pollution, any other nation that sends money similar
to what we do?
Mr. Hooks. Sure. I think that has been one of the beauties
about these programs is the international component associated
with them. Right now, there are 41 countries that participate
in the Global Methane Initiative. I think there are over 115
countries that are participating with the Clean Indoor Air
initiative. And I am not sure exactly how many countries are
participating with the Clean Fuels and Vehicles Program. But it
is an international group of countries that are now
participating and based largely in part on U.S.'s leadership.
Mr. Rush. And if this bill were to pass, which I doubt very
seriously, but if by some chance it passed the Senate, got to
the President and if he signs it, this bill becoming a law,
what would the impact of that be in terms of our international
stature, particularly as it relates to pollution?
Mr. Hooks. Well, EPA is certainly viewed as the
international leader in terms of government entities. And so
the rest of the world does turn to the EPA for its leadership
advice and counsel. I think, you know, if this legislation were
to pass, clearly, we would not be able to participate in
programs such as these. But I think it would also have a very
chilling effect in terms of our research, in terms of the
research that we conduct. It would prohibit a university
professor, if you will, going to Canada to participate in an
international meeting. And much of the international work and
scientific and technical work that we do is in large part based
on an international effort in putting the best minds and
putting the best science towards our environmental decision-
making.
Mr. Rush. Thank you. What is the total percentage of EPA
funds allocated to this program?
Mr. Hooks. For our international grant activities, it is
less than 1 percent of our EPA budget.
Mr. Rush. But because we spend that less than 1 percent,
then we have credibility in terms of the voice of the American
people being heard and felt as it relates to global issues
around the environment in this instance, including air
pollution. Is that right?
Mr. Hooks. That would definitely be correct. Again, like I
said earlier, the rest of the country does look to EPA for its
leadership, not only in our ability to promote capacity-
building and governance, but also they look to the United
States Government for our technology as well. When we have the
ability to go into these foreign countries, impart our
knowledge, we actually can bring our technologies with us. For
example, when the Partnership for Clean Fuels in Vehicles, you
know, the fact that most of the continent of Africa is no
longer using leaded fuel or is on target to no longer use
leaded fuel, that enables our initial control technology to
come into play. Catalytic converters would be a perfect
example.
Mr. Rush. Right. Well, I only have one more second. Let me
say, I just cannot believe that if this bill passed, it kind of
reminds me of a gag rag that we are muffling or gagging the
voice of the American people as it relates to our environmental
leadership, our strong voice that has been here present for the
world. We lead the world in terms of environmental issues and
matters. We are going to tie a gag rag around that voice,
silence that voice as it relates to the American people if this
bill passes.
So thank you so very much.
Thank you, Mr. Chairman.
Mr. Whitfield. At this time, I recognize the gentleman from
Nebraska, Mr. Terry, for 5 minutes.
Mr. Terry. Thank you, Mr. Chairman.
My mind started racing during this colloquy with Mr. Rush.
In your statement you said that this bill would ``cripple'' the
Agency's ability through grants to address harmful air
pollutants that affect both global and domestic environment.
And in your colloquy here----
Mr. Hooks. Um-hum.
Mr. Terry [continuing]. You had mentioned also that this is
about--well, it is less than 1 percent of the budget. It seems
like an extreme exaggeration, then, to reach a conclusion if 1
percent of the EPA's budget was eliminated, that that would
equal 100 percent of all new technologies and research like the
catalytic converter. So was the catalytic converter a result of
foreign grants?
Mr. Hooks. No, that was the result of the----
Mr. Terry. That is my point. I think in this colloquy you
were leaving us with the impression purposely that there would
be no new technologies, and I think that is so much of an
exaggeration that it probably impacted your credibility. But I
wanted to talk about how much of that 1 percent is going to the
UN. As I understand, some of that money is going to the United
Nations Environmental Program, is that correct?
Mr. Hooks. That is correct.
Mr. Terry. Do you have the amount?
Mr. Hooks. I don't have that with me.
Mr. Terry. But in general, then, could you tell me once we
provide those funds to UNEP, do we have any control over where
those dollars go?
Mr. Hooks. In the award of these grants, we actually manage
and track these grants the same way that we would a grant here
in the United States. They would be subject to the same pre-
award processing and requirements in terms of reporting as our
U.S. entities if they were to receive a grant.
Mr. Terry. You are sure that UNEP is, then, providing you
with the documentation to show how those dollars are being used
once the grant has been issued to UNEP.
Mr. Hooks. Yes, one of the requirements is that grantees
supply----
Mr. Terry. OK.
Mr. Hooks [continuing]. Us with----
Mr. Terry. So those documents would be easy--could you
provide those to the committee because I would like to see how
they are actually using those dollars and how we are tracking
those.
Mr. Hooks. Yes, sir.
Mr. Terry. So do you know offhand, though, I am really kind
of confused. As I understand, the dollars just go to UNEP and
then the grant is issued, but how do you follow up? Then, after
that, UNEP sends you the documents probably outlined in the
grant?
Mr. Hooks. It is going to be--well, I would have to
actually get back to you specifically on----
Mr. Terry. OK. If you would do that.
Mr. Hooks. I can do that.
Mr. Terry. All right. All right, I have no further
questions, Mr. Chairman.
Mr. Whitfield. All right, thanks, Mr. Terry.
At this time, I recognize the gentleman from West Virginia,
Mr. McKinley, for 5 minutes.
Mr. McKinley. Thank you, Mr. Chairman.
I would like to follow up just a little bit more on that
question, maybe make sure I heard correctly. When grants and
others are given to the countries, universities, wherever, I am
curious about the follow-up, particularly there were several--
well, take some of the more serious ones was the demonstration
project for the abatement of nitrous oxide emissions using--
anyway, it was a demonstration project. What did we do? Did we
follow up?
Mr. Hooks. What particular----
Mr. McKinley. This was with Taiwan, funded in '02. I am
just curious. Do we have a set pattern of following up to see
that, once money has been given to something, we have a
procedure to see what they have done with it?
Mr. Hooks. Once EPA makes an international grant award, we
carefully monitor the grant. This includes administrative and
programmatic post-award monitoring----
Mr. McKinley. Well, what happens afterwards, if we do a
pilot project that ends in a couple years or whatever, do we
follow back up again to see was this just a one-shot deal? Or
do we make that a condition? Is that a condition of the grant
that they are going to continue to fund this project?
Mr. Hooks. No, sir.
Mr. McKinley. OK. So things like--there is a series of them
like that that we are just giving money away and we are not
following up that pilot project and clean projects and
processes in Norway. The Diesel Retrofit Demonstration Project
in Thailand, did we follow up to find out are they continuing
to work with diesel fuels in that country or is this just a
one-shot deal?
Mr. Hooks. I don't know specifically about the particular
projects you might be referencing to, but I can tell you just
in terms of scientific growth, you know, we learn from these
projects. One of the great benefits in terms of what we might
be piloting or demonstrating in a particular country is that we
have the ability to take the lessons learned and transfer that
to other regions.
Mr. McKinley. But when we fund these other projects, if
they just die on the vine, if they are just a one-shot deal, I
am just curious, what American project that maybe could have
put some people to work here and researchers, something in
America that lost out in the competitive research? And I look
at this one that we did a field survey of endangered whale
population offshore of Russia. What American project lost out
to that?
Mr. Hooks. Well, I am not sure if that is a Clean Air Act--
--
Mr. McKinley. Clean Air Act has to do with whales?
Mr. Hooks. I am not sure if that is a Clean Air act. There
are other authorities----
Mr. McKinley. No, this is your list that you all provided
all the--I am just curious about that, but obviously you don't
have the answer for that.
Mr. Hooks. Well, I believe that we supplied the committee
all of our international----
Mr. McKinley. I am just curious with all this money we are
spending overseas, whether it is 30 million or $5 million, when
the EPA itself recognizes that the biggest detriment to
healthcare in America is indoor air quality--in its own Web
site, the EPA publishes that it is 96 times worse indoors than
outdoors--but yet we are spending money on--I don't know what
we are doing in America to focus on indoor air quality. I don't
see much at all on that, and that is the issue that we know
when we have the asthma attacks, we have other issues they are
talking about, why aren't we educating our American people on
where our air quality's issues are rather than worrying about
the endangered whales off Russia?
Mr. Hooks. Well, as it relates to air quality, air
pollution is an international problem. It has been fairly well
documented that certainly pollution from Asia is deposited here
in this country, the same as pollution that is generated here
in this country goes across the Atlantic and gets deposited in
Europe. International air pollution problems is an
international----
Mr. McKinley. I am not denying that but I am just saying at
this time when we can't afford it, I think I would rather spend
my money taking care of American citizens and educating
American folks about indoor air quality or whatever it is than
worrying about some of these others.
So what I am hearing wrapping up, we don't have necessarily
or you are not aware of a follow-up program to find out after
we do a demonstration project, after we do a start-up, there is
no follow-up to see that they continue with that. We don't have
a prioritization of where we are going to spend money on indoor
air quality in America but we are sure spending a lot of money
dealing with indoor air quality overseas. And lastly is that
apparently we are losing out. Some of our American companies
are losing out in applications to foreign governments. I would
be curious how many American applications were lost in the
shuffle.
Mr. Hooks. Well, I need to go back to one of the advantages
of these grants is actually creating market opportunities for
U.S. industry here in this country. The Global Methane
Initiative, while the EPA component--it is a multiple-agency
component, by the way. In fact, the majority of the money that
has been distributed through these Section 103 grants has
actually not come from EPA; it has actually come from the
Department of State and USAID and other agencies as well.
For example, I know that Caterpillar was able to sell 62
megawatt generators to a coalmine in China for $100 million.
MEGTEC, which is another large U.S. subsidiary here in this
country was able to sell some thermal oxidizers for millions of
dollars as well to overseas countries. It is, you know, putting
our foothold into these countries that actually is good for
U.S. industry as well.
But as I said before, air pollution does not respect
geopolitical boundaries. I think that was maybe stated in one
of the opening statements. It does not respect geopolitical
boundaries. So U.S. monies that can be spent at the source of
pollution I think is a good use of our money because ultimately
that deposition can impact our U.S. shores.
Mr. Whitfield. Gentleman's time is expired.
You know, Mr. Hooks, I may just make one comment here. You
were talking about Caterpillar selling equipment, coalmines in
China. As a result of EPA, we can't even build a new coal-
powered plant in America, so it is nice that you all like to
see equipment going to China so they can mine coal.
I recognize the gentleman, Mr. Pompeo from Kansas, for 5
minutes.
Mr. Pompeo. Thank you, Mr. Chairman. I am going to follow
up on that.
You know, we have had multiple hearings on energy
initiatives here in America and it is great to see you talk
about how pollution from Asia impacts us here. I will tell you
that the very policies that the Environmental Protection Agency
has put in place has driven that production, coal-fired power
plants, all those things, out of America, all of this
manufacturing out of America and then the pollution comes back.
Actually, in the very first hearing as a Member of Congress I
asked Ms. Jackson about that and she pooh-poohed the idea that
this pollution was coming here and that they don't live under
the same regulatory environment that we do and don't have the
same rules for their processes, so it is fascinating to hear
you sort of argue the other side of the coin inside the
administration. I would suggest maybe a little meet between the
two of you.
But I want to get to a couple of things that you said. Does
the competition for international grants compete with the
domestic grants?
Mr. Hooks. Yes.
Mr. Pompeo. So they are in the same pool?
Mr. Hooks. Yes, sir.
Mr. Pompeo. And what part of that is the fact that it is
not in the United States, that it is how much of a piece of the
criteria is the fact that it is a non-U.S. applicant versus a
U.S. applicant? What piece of the criteria is that?
Mr. Hooks. Can you restate the question again? I am sorry.
Mr. Pompeo. Yes, so they are in the same pool competing for
the same grant money, American taxpayer money, and when you are
deciding whether to send it to Kentucky or Botswana, how much
of the fact that it is not in America does that impact your
decision-making process?
Mr. Hooks. Well, bear in mind the majority of our
international grant money would go to like the University of
Kentucky----
Mr. Pompeo. Um-hum.
Mr. Hooks [continuing]. Where a Kentucky professor or
graduate----
Mr. Pompeo. The majority. Those that don't, let us talk
about those that don't go to a U.S. institution. Is it a factor
that it is a non-U.S. entity? Is that weighed in the merit
process or is it just blind? You don't even know if it going to
Oregon or Denmark?
Mr. Hooks. Well, we would know where the grant proposal--
where the monies were ultimately----
Mr. Pompeo. So do you use it a factor in the decision-
making process?
Mr. Hooks. Ultimately, the criteria that we are going to
use is how does it impact the human health and the environment
here in the United States----
Mr. Pompeo. Right, so it doesn't matter----
Mr. Hooks [continuing]. But there are other criteria.
Mr. Pompeo [continuing]. The country that it is going to.
If it has got a higher net benefit on an environmental basis,
then it goes to Denmark as opposed to Oregon. You don't weigh
the fact that it is a non-U.S. entity directly?
Mr. Hooks. The first criteria that we are going to use is
the impact----
Mr. Pompeo. Right.
Mr. Hooks [continuing]. And the benefit to the
environmental quality of the United States.
Mr. Pompeo. Makes sense. You talked about sort of nation-
building and national security. Do you coordinate with the
State Department before making these grant awards?
Mr. Hooks. Yes, we do.
Mr. Pompeo. And the Department of Defense?
Mr. Hooks. Not the Department of Defense.
Mr. Pompeo. So just the State Department?
Mr. Hooks. Yes, sir.
Mr. Pompeo. Got it. How many offices within EPA actually
distribute grants for activities that occur overseas other than
under this particular program?
Mr. Hooks. I don't know specifically but certainly our
Office of Research and Development, obviously the Air Program.
But I would have to check----
Mr. Pompeo. Are they coordinated? That is, are you all
saying, you know, the State Department says, ``We don't really
want to deal with this nation. I think we won't give them a
grant.'' Are you guys coordinated or is it completely stove-
piped so you all don't know what is going on in the other parts
of EPA, let alone other parts of the administration?
Mr. Hooks. No, it is coordinated. Before we award a grant,
it would be coordinated with our Office of International and
Tribal Affairs. Once it meets their criteria, it would be sent
through the State Department provided it met their criteria.
Provided that they concurred, we would fund it. If either one
of those entities were to not concur, if it was inconsistent
with our foreign policy, then it would not be funded.
Mr. Pompeo. OK. I will just close here. I have to tell you
that when I go home, much like you, before I go home and talk
to folks, when you are $16 trillion in the hole, to justify
programs like this is an incredibly difficult sell. It is not
something that I can support. You all talk about it being
bipartisan; this began in a previous administration. That may
well be. I am neutral as to who is making this poor decision,
whether it is a Democrat or Republican administration. It is of
no importance to me. This program whose time, if it was ever
here, is certainly gone now.
And I yield back the balance of my time.
Mr. Whitfield. At this time, I recognize the gentleman from
Virginia, Mr. Griffith, for 5 minutes.
Mr. Griffith. Thank you, Mr. Chairman.
Thank you so much for being here today, Mr. Hooks. You
would agree with me that Virginia is more important than
Kazakhstan, would you not?
Mr. Hooks. I would agree that----
Mr. Griffith. At least to our government?
Mr. Hooks. To our government, yes.
Mr. Griffith. All right. And you would also agree, would
you not, that China is not doing enough to clean up their air
pollution and that you would like to see them moving at a
faster pace, is that not correct?
Mr. Hooks. That would be correct.
Mr. Griffith. So then I question why you would not or why
the EPA would not support withholding money from any country
that is not moving fast enough or as fast as the United States
at cleaning up its air pollution, because I note that in a
Virginian pilot article of yesterday that the EPA in regard to
the Chesapeake Bay has held back Virginia's money--1.2 of the
$2.4 million granted originally to Virginia to help it clean up
the Bay--and I understand I am talking about water but I was
glad to hear that you all are coordinated so I want you to take
this message back--that you are withholding that money because
you don't think Virginia is moving fast enough on stormwater
management. And one of the problems that Virginia is having
with that, of course, is that the cities that are required to
do more on stormwater management on the waters that fall on
their streets are Norfolk, Virginia Beach, Chesapeake,
Portsmouth, Newport News, and Hampton, and while I don't
represent those areas, I certainly feel their pain.
And they say that it would be expensive and they are having
a hard time coming up with the money because they have thrown
up their hands--I am quoting from the article now--``local
governments across Virginia have thrown up their hands at the
prospect of financing stormwater upgrades amid budget crises
and layoffs'' and yet we are sending money to other countries
but we are holding back the money to Virginia. And I hope--and
I am not going to ask you for a response because I know it puts
you at odds and the water side of it is not your deal, but I
hope that somebody at the EPA recognizes the conflict there. We
are going to hold back Virginia's money. We are going to make
it even harder on localities that are struggling now to deal
with stormwater management. At the same time, we are sending
money to places like China, Kazakhstan--and there are a lot of
different places that we have sent money to--and it just seems
when we are having issues with money in this country that maybe
we ought to care more about the Bay than we do necessarily what
is going on in some small project in China.
Moving on, I will also note that I agreed with and here-
here'd the chairman's comments in regard to coalmining. We lost
another 620 miners last week who were laid off in my district
in on small town alone, and yet I noticed that one of--and it
is true that some of these were started in the previous
administration, so I am not trying to pick on the
administration, but explaining why I think this bill has some
merit and why we should take a look at it, we are helping the
Chinese figure out how to--it is technical assessment of
coalmine gas recovery and utilization in China. Well, the
Chinese don't seem to be having any problem competing with us
on all kinds of different levels, and I don't understand why we
are giving them grants to help them in their industries. Now,
can you explain that to me?
Mr. Hooks. Well, one of the purposes of the grant is
actually for governance and capacity-building. One of the
things that we are trying to do in these foreign countries as
they approach us for our advice and expertise is how do they
raise the environmental standards that we have here in this
country. If we are successful at what we are doing, if we can
raise the environmental standards and environmental
requirements in the governance of other countries, that puts
our U.S. industry at a more equal footing in terms of our
ability to compete.
Mr. Griffith. And I am wondering that was $180,000 and I am
wondering if you all have given any mining operations in the
United States $180,000 to help them with technical assessment
of coalmine gas recovery and utilization? Because what my
companies tell me generally is is that you all come in and tell
them they got to do it; they have to spend the money or they
get fined. So it looks like to me we are taking money out of
the mines, you know, out of the pockets of the mines in the
United States while we are giving money to help the Chinese
mines figure out their problems.
Mr. Hooks. Well, bear in mind, we have actually worked----
Mr. Griffith. Let me ask this question because my time is
running out.
Mr. Hooks. OK.
Mr. Griffith. Have you given any $180,000 grants to the
United States mines to help them with this same type of thing?
Mr. Hooks. We work extensively with the U.S. Mining
Commission on voluntary programs such as coalmine methane
reduction. We understand it can be used as an energy source and
it is also----
Mr. Griffith. I use Mr. Dingell's----
Mr. Hooks [continuing]. Very explosive----
Mr. Griffith. Yes or no, have you given any grants of a
similar size, $180,000 or more to U.S. mining concerns in
regard to helping them mine coal?
Mr. Hooks. I do not know. I am not saying that we haven't.
I am just not aware of any personally.
Mr. Griffith. All right. You don't have a list of those.
Can you get me a list of all of those?
Mr. Hooks. Of where we worked with the U.S. mining
industry?
Mr. Griffith. Where you have given grant money to help U.S.
coalmines figure out better ways to give them money to help
them put the equipment in or whatever is necessary like you did
the Chinese? And I am looking at page 17 of your report--
``technical assessment of coalmine gas recovery and
utilization.''
Mr. Hooks. I will see what we have in our files.
Mr. Griffith. And like some of the others have said, I am
glad that you recognize it is an international problem. One of
our concerns has been that we think we are sending jobs with so
many different regulations coming from so many different parts
of the EPA and other agencies at one time and we are actually
sending a lot of jobs overseas. And as you recognize, we are
reaping back pollution and we think we need a better-paced set
of regulations and more reasonable regulations.
Thank you, Mr. Chairman. I yield back.
Mr. Whitfield. The gentleman's time is expired.
Mr. Hooks, I want to thank you very much for being with us
this morning. In concluding, we would appreciate if you would
get back to the committee with a list of grants that have been
made to U.S. coalmining companies.
Mr. Hooks. Bear in mind, some of our grants go to
universities or other institutions and they in turn work with
other entities.
Mr. Whitfield. Yes, but we would like a list of any direct
grants you have given to coalmining companies.
Mr. Hooks. Yes, we wouldn't have the authority to actually
give a grant to a mining company.
Mr. Whitfield. All right. OK. Then I would like for you to
do this. I am going to give you a grant number, grant number
83299401 and 83505801. Those were two grants that the EPA
through 103 grants gave to the China Coal Information
Institute. And I would like for you to provide the committee a
synopsis of the information or benefit to the taxpayers from
those two grants. Thank you.
Mr. Hooks. Yes, sir. Thank you.
Mr. Whitfield. That concludes the questions.
Mr. Hooks, thank you again for being with us. And at this
time----
Mr. Hooks. Thank you, Mr. Chairman.
Mr. Whitfield. Did you have a question? No. OK.
At this time, I would like to call up those on panel two,
our witnesses on the second panel. And we have with us Mr.
Daniel Simmons, who is the Director of Regulatory and State
Affairs for the Institute for Energy Research. We have Dr.
Andrew Light, Senior Fellow, Center for American Progress
Action Fund; Associate Director, Institute for Philosophy and
Public Policy at George Mason University. We have Ms. Elisa
Derby, Senior Program Officer, Winrock International; Co-
coordinator for the Partnership for Clean Indoor Air. And we
have Dr. David Kreutzer, Research Fellow in Energy Economics
and Climate Change at the Heritage Foundation.
So I would like to welcome all four of you to the
committee. We appreciate very much your taking time to join us
to discuss H.R. 4255 and your views on the legislation.
And Mr. Simmons, we would like to start with you and you
will be recognized for 5 minutes for your opening statement.
STATEMENTS OF DANIEL SIMMONS, DIRECTOR OF REGULATORY AND STATE
AFFAIRS, INSTITUTE FOR ENERGY RESEARCH; ANDREW LIGHT, SENIOR
FELLOW, CENTER FOR AMERICAN PROGRESS, AND ASSOCIATE DIRECTOR,
INSTITUTE FOR PHILOSOPHY AND PUBLIC POLICY, GEORGE MASON
UNIVERSITY; ELISA DERBY, SENIOR PROGRAM OFFICER, WINROCK
INTERNATIONAL; AND DAVID W. KREUTZER, RESEARCH FELLOW IN ENERGY
ECONOMICS AND CLIMATE CHANGE, THE HERITAGE FOUNDATION
STATEMENT OF DANIEL SIMMONS
Mr. Simmons. My name is Daniel Simmons. I am the director
of Regulatory Affairs at the Institute for Energy Research.
It is difficult for me to see the value of EPA providing
taxpayer funding grants to organizations and governments
outside the United States for things such as ``good governance
capacity-building'' in Jordan or ``regulatory dialogue'' on
landfill gas in Brazil. Part of the reason the United States is
now over $16 trillion in debt is because the Federal Government
has little spending discipline. Compared to $16 trillion, these
grants are small, but the grants are symptomatic of out-of-
control spending by the Federal Government. When individuals
have money and debt problems, the commonsense solution is to
cut back on unnecessary spending. It is only fair to ask the
Federal Government to do the same. Taxpayer dollars should be
spent on projects that have an obvious benefit to the American
people and these foreign grants do little, if anything, to
benefit Americans.
If EPA would like to improve environmental quality at home
and abroad, a far more productive approach would be to promote
environmental improvements through economic growth. Years of
research shows that economic growth promotes environmental
protection. As noted previously, Section 103 does not provide
explicit authority for EPA to award these grants to foreign
entities, only to ``establish a national research and
development program. But Section 103 also does not provide an
explicit limitation, and therefore, EPA for years has been
awarding these sorts of grants.
When faced with these questions, I would hope that EPA
would look to the Federal regulatory philosophy that is laid
out in Executive Order 12866, which was originally signed by
the Clinton administration and reaffirmed by the Bush
administration and again reaffirmed by the Obama
administration. And in pertinent part, the Executive Order says
that Federal agencies should promulgate only such regulations
as are required by law, are necessary to interpret the law, or
are made necessary by compelling public need. And it is
difficult to see for these grants that they are required by law
or necessary or what the compelling public need is, at least
for American citizens. And these grants, there is a large
number of them that are definitely of dubious value for
Americans.
For example, on March 22 of this year, EPA awarded a grant
with the following description: ``the goal of this project is
to increase environmental public participation through a pilot
project in Dominican Republic. ALIANZA will work with
stakeholders and appropriate governmental authorities to ensure
the pilot project expected results are successfully
accomplished.'' Now, I have no idea what in the world it means
to ``increase environmental public participation'' and what
value that is for the American people. Pollution may cross
boundaries but this isn't about that. This is about
``increasing environmental public participation.''
And if EPA wants to promote environmental protection,
economic growth is a far better alternative, but as we have
seen from EPA, a number of the regulations that they have been
promoting lately does not promote economic growth. One example
is the Mercury and Air Toxics Standards Rule. The point of this
rule, allegedly, is to reduce mercury. However, the rule cost
$10 billion a year according to EPA and results in a maximum--
according to EPA--of $6 billion in benefits from the reduction
of mercury. In other words, this is a net cost to the American
economy, and honestly the economy of the world, of $10 billion
a year. You can buy a lot of anaerobic digesters in China or
Brazil or where-have-you with $10 billion. And the Mercury and
Air Toxics Standards is just one example, but it is
representative of EPA's current regulatory philosophy.
Far more benefits could be achieved both environmental and
economic if EPA were more circumspect in its regulation. The
American people want Congress to balance the budget and get
America's fiscal house in order. One key to doing this is to
reduce spending on things that are obviously unnecessary. It is
not obvious what the value is to the American people of
international grants issued under the Clean Air Act, Section
103.
I thank you for your time and I will be happy to answer any
questions.
[The prepared statement of Mr. Simmons follows:]
[GRAPHIC] [TIFF OMITTED] 82931.070
[GRAPHIC] [TIFF OMITTED] 82931.071
[GRAPHIC] [TIFF OMITTED] 82931.072
[GRAPHIC] [TIFF OMITTED] 82931.073
[GRAPHIC] [TIFF OMITTED] 82931.074
[GRAPHIC] [TIFF OMITTED] 82931.075
[GRAPHIC] [TIFF OMITTED] 82931.076
[GRAPHIC] [TIFF OMITTED] 82931.077
[GRAPHIC] [TIFF OMITTED] 82931.078
Mr. Whitfield. Thank you very much, Mr. Simmons.
And Dr. Light, you are recognized for 5 minutes.
STATEMENT OF ANDREW LIGHT
Mr. Light. Thank you, sir.
Chairman Whitfield, Representative Rush, honored Members, I
appreciate the invitation to testify on H.R. 4255. In these
brief remarks, I will focus on that part of my written
testimony which offers evidence for House Section 103 grants to
foreign partners help to protect the health of Americans,
fulfill our foreign policy objectives, ensure American
competitiveness, and deliver on our ability to solve global
environmental problems. I will give examples for each point. My
written testimony has many others.
Point one: these grants help to protect the health and
safety of Americans. Mr. Simmons called into question the
utility of these grants for Americans. In fact, funding for
studies and projects abroad directly help to protect us. For
example, interdisciplinary team led by Susan Annenberg at the
University of North Carolina demonstrated in 2009 that
reductions in air pollution in other countries will result in
significantly reduced mortality rates here in the United
States. Looking at the impacts of ozone pollution alone in
their study--a target of many of these grants--they estimate
foreign emission reductions contribute about 30 percent of the
total avoided mortalities in North American with almost \3/4\
of those in the United States. Increasing these measures abroad
will save more American lives.
Point two: these grants help the United States to meet
critical foreign policy objectives. In a moment, Ms. Derby will
describe the importance of Winrock's work with the Partnership
for Clean Indoor Air and the Global Alliance for Clean
Cookstoves, including the lifesaving benefits these projects
have provided for millions of people. But the Clean Cookstoves
initiative does more than prevent indoor air pollution; it
reduces the vulnerability of women in African conflict zones by
decreasing their time gathering fuel, which in turn increases
their social mobility. This may not seem like much but it is
quite a lot for them given their daily lives. More is provided
here than a new appliance. These cookstoves assist in creating
a fundamental element of democracy, namely, a safe, free
environment where they can have a chance at success, which in
turns strengthens our relationship with these countries.
Point three: these grants help to ensure competiveness for
American companies, as many have already argued. Support for
multilateral organizations that raise ambition for tighter
pollution-protection measures abroad, including cooperation
with organizations like UNEP, the OECD, and others help to
ensure the developing countries are applying similar pollution
standards that we do at home. Programs like the Partnership for
Clean Fuels in Vehicles, as we heard in the first panel, help
U.S. companies abroad because equal regulation on air pollution
creates a level playing field for American companies to be
competitive when manufacturers in other countries are being
held to the same standards.
Point four: these grants are critical for applying global
solutions to global challenges. And I will spend a bit more
time on this one. The Global Methane Initiative mentioned
earlier by Assistant Administrator Hooks certainly helps to
reduce the impact of this powerful greenhouse gas, as he said.
But the impacts go much further and help to explain why all
countries have an interest in cooperatively taking on these
challenges and are doing so now. Methane, along with black
carbon, hydrofluorocarbons, and tropospheric ozone are what we
call short-lived climate pollutants. Not only do these gases
have more warming potential than carbon dioxide, some of them
are potentially deadly. Each year, millions of people die
prematurely from black carbon or soot. These gases are also
responsible for extensive crop losses each year.
Regardless of one's views on the reality of climate
change--we don't have to agree on that--addressing these non-
CO2 pollutants is both cost-effective and yields multiple
health and economic benefits. For example, this year, a study
published in ``Science'' by an international team led by NASA's
Drew Shindell estimated the effects of 14 very straightforward
methane and black carbon control measures. Implementation of
these measures would avoid up to 4.7 million annual premature
deaths worldwide and increase crop yields annually by 30 to 135
million metric tons starting in 2030 and beyond, including 6.3
proven million tons of crops in the United States.
The costs for these programs are minimal. Reducing a metric
ton of methane costs around $250 while the benefit ranges from
700 to $5,000. Already U.S. investments in the Global Methane
Initiative have leveraged 398 million in additional investment,
or almost three times as much as all 103 grants to foreign
recipients since the year 2000. Developing countries simply
cannot leverage private finance in the way U.S. dollars can,
and that is why we need cooperation on these efforts moving
forward.
Now, for those who are concerned with global warming, this
suite of measures reduces total projected warming by half a
degree Celsius. Given that the current internationally accepted
goal is to try to stabilize temperature increase caused by
humans at 2 degrees Celsius over preindustrial levels and given
that humans have already pushed the temperature up almost 1
degree, we can't afford not to do this.
The measure studied in the Shindell paper include reducing
methane leakage from coalmining, oil and gas production,
landfills, wastewater, livestock manure, and rice paddies. The
black carbon measures cover diesel vehicles, clean-burning
biomass, and things like cookstoves, in other words, exactly
the same kinds of programs that the Section 103 grants are
funding right now.
Provision of these funds is not proof that developing
countries will not work towards reducing emissions on their
own, as some have argued. Instead, it shows that an ambitious
approach focused on sharing knowledge on multiple fronts helps
to build momentum toward a common end that will benefit
everyone. Developing countries are already working to reduce
these pollutants for the same reason we are--to save lives,
grow more food, and give their children a chance at a better
future.
To briefly conclude, given the abundant benefits
demonstrated here of cooperation with foreign partners in
projects outside of the United States and given the absolute
necessity for international cooperation to adequately address
problems that cannot effectively be stopped at anyone's
borders, it would be irresponsible to limit EPA as this bill
proposes.
Of course I agree that we need to reduce budgets across the
board in the Federal Government. No one could argue otherwise.
But if we must trim 103 grant programs, better to use a scalpel
than a sledgehammer.
[The prepared statement of Mr. Light follows:]
[GRAPHIC] [TIFF OMITTED] 82931.079
[GRAPHIC] [TIFF OMITTED] 82931.080
[GRAPHIC] [TIFF OMITTED] 82931.081
[GRAPHIC] [TIFF OMITTED] 82931.082
[GRAPHIC] [TIFF OMITTED] 82931.083
[GRAPHIC] [TIFF OMITTED] 82931.084
[GRAPHIC] [TIFF OMITTED] 82931.085
[GRAPHIC] [TIFF OMITTED] 82931.086
[GRAPHIC] [TIFF OMITTED] 82931.087
[GRAPHIC] [TIFF OMITTED] 82931.088
[GRAPHIC] [TIFF OMITTED] 82931.089
[GRAPHIC] [TIFF OMITTED] 82931.090
[GRAPHIC] [TIFF OMITTED] 82931.091
[GRAPHIC] [TIFF OMITTED] 82931.092
[GRAPHIC] [TIFF OMITTED] 82931.093
[GRAPHIC] [TIFF OMITTED] 82931.094
[GRAPHIC] [TIFF OMITTED] 82931.095
[GRAPHIC] [TIFF OMITTED] 82931.096
[GRAPHIC] [TIFF OMITTED] 82931.097
[GRAPHIC] [TIFF OMITTED] 82931.098
Mr. Whitfield. Ms. Derby, you are recognized for 5 minutes.
STATEMENT OF ELISA DERBY
Ms. Derby. Chairman Whitfield, Representative Rush,
distinguished members of the committee, thank you for inviting
me here today. My name is Elisa Derby. I am a senior program
officer at Winrock International and I manage Winrock's
household energy programs.
Winrock International is a nonprofit organization that
works with people in the United States and around the world to
empower the disadvantaged, increase economic opportunity, and
sustain natural resources. Winrock is headquartered in Little
Rock, Arkansas, the State of our namesake, former governor
Winthrop Rockefeller. I am pleased to be here today to discuss
Winrock's partnership with the U.S. Environmental Protection
Agency related to clean, efficient cooking practices. Winrock
is one of the grantees being discussed today.
I will summarize my testimony for you today to maximize
time for your questions. My complete testimony has been
submitted for the record. I hope this testimony helps committee
members understand the work we have done and the people it has
benefitted.
Some 3 billion people worldwide burn solid fuels like wood,
animal dung, crop residues, coal, and charcoal for cooking and
heating in open fires or rudimentary stoves, releasing toxic
smoke into their homes. Nearly 3 million people, primarily
women and children in poor countries, die prematurely each year
from exposure to indoor smoke from burning solid fuels, more
than from either AIDS or malaria. Pneumonia, also closely
associated with exposure to indoor smoke, is the number one
killer of children worldwide and kills more children than AIDS,
malaria, and tuberculosis combined. Exposure to indoor smoke it
also associated with various cancers, cataracts, tuberculosis,
asthma attacks, babies born with low birth weight or stillborn,
and early infant death.
Time and money spent on gathering and buying fuel
perpetuates the cycle of family poverty. While I am not an
expert on this issue, we do know that there are direct links
between international poverty and U.S. national security. The
inefficient burning of wood and charcoal also increases
pressures on local natural resources and contributes to
emissions of greenhouse gases and black carbon. In short, the
simple task of cooking family meals has serious negative health
and socioeconomic implications for half the world's population
and serious negative environmental impacts locally and
globally.
Fortunately, there are clear solutions to these problems.
Winrock, EPA, and a host of national, international, and
private sector partners have worked to promote low-cost but
clean and efficient approved cookstoves to address these
problems since 2002 under the Partnership for Clean Indoor
Air--which we will refer to as PCIA--launched as a presidential
initiative of George W. Bush and led by EPA, and now, through
ongoing work of the Global Alliance for Clean Cookstoves, EPA,
and other U.S. government agencies.
I personally have witnessed the damaging health and safety
effects of indoor air pollution in homes I have visited in
Latin America and Asia and the impact that a clean, efficient
cookstoves can have on their lives. Women have shared with me
that with an improved cookstove, they cough less and their
children stay healthier. They say they have more time to spend
with their children and more money for food and school as a
result of their reduced fuel needs of the improved stoves. They
are horrified to realize that the soot coating their walls and
ceiling from their old stove was also coating their children's
lungs.
As a recognized global leader and expert in indoor air
quality, EPA's involvement in this work has lent important
prestige to the improved cookstoves sector that has enabled
tremendous accomplishments and growth and development of the
sector over the past 8 years that would not have been possible
otherwise. Over the 6 years that we monitored PCIA partner
achievements, PCIA partners reported selling and distributing
more than 9.3 million improved stoves benefitting approximately
52 million people around the world.
Winrock takes seriously our important role as stewards of
U.S. taxpayer dollars. As such, we are firmly committed to
cost-effective and efficient use of funds and always require
significant participant cost-share for all travel scholarships
used to bring participants to our high-impact and low-cost
technical trainings. Participants that receive airfare support
are responsible for all other travel costs, including meals and
lodging. The overwhelming majority of the grant funding that
Winrock has received from EPA for this partnership was spent
here in the United States. At no time have any funds been
transferred to any foreign government or other foreign entity.
We believe that the work EPA has funded to date related to
clean and efficient cookstoves has been pioneering and vital to
the sector, and we have been proud to play a role in these
achievements. Ultimately, this effort will lead to more people
using better technologies and practices, reducing their
exposure to indoor smoke, and thereby improving their health,
livelihood, and quality of life.
I appreciate the opportunity to make this presentation and
I am happy to answer any questions you may have.
[The prepared statement of Ms. Derby follows:]
[GRAPHIC] [TIFF OMITTED] 82931.099
[GRAPHIC] [TIFF OMITTED] 82931.100
[GRAPHIC] [TIFF OMITTED] 82931.101
[GRAPHIC] [TIFF OMITTED] 82931.102
[GRAPHIC] [TIFF OMITTED] 82931.103
[GRAPHIC] [TIFF OMITTED] 82931.104
[GRAPHIC] [TIFF OMITTED] 82931.105
[GRAPHIC] [TIFF OMITTED] 82931.106
[GRAPHIC] [TIFF OMITTED] 82931.107
[GRAPHIC] [TIFF OMITTED] 82931.108
[GRAPHIC] [TIFF OMITTED] 82931.109
[GRAPHIC] [TIFF OMITTED] 82931.110
[GRAPHIC] [TIFF OMITTED] 82931.111
[GRAPHIC] [TIFF OMITTED] 82931.112
[GRAPHIC] [TIFF OMITTED] 82931.113
[GRAPHIC] [TIFF OMITTED] 82931.114
Mr. Whitfield. Thank you, Ms. Derby.
Mr.----
Mr. Kreutzer. Kreutzer.
Mr. Whitfield. Kreutzer. Dr. Kreutzer, you are recognized
for 5 minutes.
STATEMENT OF DAVID W. KREUTZER
Mr. Kreutzer. My name is David Kreutzer. I am research
fellow in energy economics and climate change at the Heritage
Foundation. The views I express in this testimony are my own
and should not be construed as representing any official
position of the Heritage Foundation.
Chairman Whitfield and Ranking Member Rush and other
members of the committee, I want to thank you for inviting me
to address you on the issue of EPA grants to foreign
recipients.
Though there may well be legitimate concerns about the
appropriateness of funding environmental activities abroad,
especially given our national debt and the fraction of our debt
that is held by one of the leading recipient countries, a
greater concern is what this tells us about our government's
vision for much more significant obligations. That the EPA
funds environmental programs in foreign countries is a clear
sign that these countries are unwilling to fund these programs
themselves. Though there are serious disagreements about the
impact of CO2 emissions, climate skeptics, climate activists,
the EPA, and others all agree the growth of CO2 emissions over
the next century will come predominantly if not entirely from
the developing countries.
For example, in 2002, China's CO2 emissions were 40 percent
less than those in the United States while this year they are
at least 50 percent greater. And this trend is likely to
continue with CO2 emissions coming from the developing world
are growing much faster than they will from the developed
world.
Even accepting the Intergovernmental Panel on Climate
Change's high-end estimate of climate sensitivity--and that is
a measure of how much warming there will be for a doubling of
carbon dioxide levels in the atmosphere--even accepting those
numbers, it is acknowledged that cutting CO2 emissions in the
U.S. alone or even in conjunction with the Annex I countries--
that is the developed countries of the Kyoto Agreement--will
moderate any global warming by less than a half a degree by the
end of this century. Whenever this point was made in the
debates over cap-and-trade bills, for instance, the proponents
of the legislation would imply that the emerging economies
would follow our lead. What these proponents usually left out
was that we would have to pay them to follow our lead.
And why should they want to voluntarily? Last summer, there
was a headline that said half of India was without electricity
that was due to a blackout. The week before, they could have
had a headline that said \1/3\ of India is without electricity
because they are always without electricity. All right? And so
they are looking at having phenomenal growth rates. They would
like everybody to have electricity. They would like them to
have more than just electricity; they would like them to have
refrigerators and dishwashers and all the things that we have.
It is going to take a phenomenal amount of money to bribe them
to forego those things, that growth that they would get by
using energy.
The UN Framework Convention on Climate Change established a
$100 billion Green Climate Fund as sort of the first ante to
help transfer this wealth from the developed world to the
developing world to get them to comply with the carbon
restrictions. What the UN Framework Convention on Climate
Change left out was the actual funding part of this fund, but I
think we can get an idea by simply looking at past legislation
in the U.S. The Lieberman-Warner cap-and-trade bill had
provisions for designating U.S. money to go to foreign
programs, as did the Waxman-Markey cap-and-trade bill, as did
the Kerry-Boxer cap-and-trade bill, as did the Kerry-Lieberman
cap-and-trade bill.
EPA funding of foreign environmental programs is a clear
sign that foreign countries are unwilling to fund these
programs themselves. It should be noted that the cost of these
programs is a small fraction of the cost of those necessary for
these countries to meet carbon emission targets set out by
proponents of global warming policies. So this is yet another
sign that any carbon legislation in the U.S., whether it is a
carbon tax or a cap-and-trade, is likely to obligate U.S.
energy consumers to bear not only the burden of our own
policies but the additional burden of paying foreign countries
for their compliance. There is new universal agreement that
without severe restrictions on the carbon emissions of the
developing countries, no policy in the developed world will
have sufficient impact for them to meet the targets that are
being set out, ones that I oppose, by the way.
Though unadvertised, this significant additional burden of
paying for the developing world's compliance is known to those
involved in climate negotiations and policymaking. The UN has
established a fund that will require developed countries to
contribute hundreds of billions of dollars. U.S. energy
consumers may not know about this obligation, but those
negotiating supposedly on their behalf do, that every major
cap-and-trade bill in the U.S. included mechanisms for
contributing to this fund or ones like it makes it clear that
climate policymakers in the U.S. intend to acquiesce to these
demands for our wealth.
Taken in this context, the EPA grants may just be the
camel's nose in the tent. Thank you.
[The prepared statement of Mr. Kreutzer follows:]
[GRAPHIC] [TIFF OMITTED] 82931.115
[GRAPHIC] [TIFF OMITTED] 82931.116
[GRAPHIC] [TIFF OMITTED] 82931.117
[GRAPHIC] [TIFF OMITTED] 82931.118
[GRAPHIC] [TIFF OMITTED] 82931.119
[GRAPHIC] [TIFF OMITTED] 82931.120
[GRAPHIC] [TIFF OMITTED] 82931.121
Mr. Whitfield. Thank you very much, Dr. Kreutzer.
And thank all of you for your testimony. I will recognize
myself for 5 minutes and then the other Members will ask
questions as well.
Mr. Simmons, in your testimony you talked about the
Executive Order that President Clinton and President Obama had
in which it basically was saying that agencies should not issue
grants other than as explicitly set out in the legislation of
the statute. Can you make an argument based on that Executive
Order that EPA may be violating that Executive Order with their
103 grants?
Mr. Simmons. Well, I need to be clear on this. The
Executive Order is the regulatory philosophy, and there is
obviously a difference between regulations and between grant-
making. And my argument is that grant-making and how they
decide grant-making ought to be analogous to how they should be
following the regulatory philosophy. So I mean I think it
definitely violates the spirit of the Executive Order, but
unfortunately, there has been a longstanding----
Mr. Whitfield. Well, there has been a long standing and I
agree with you that I think it does violate the spirit of it.
And I don't really agree with EPA that it is very clear in the
Section 103 statute that they have the authority to do these
international grants. But I think primarily they are relying on
their NEPA authority and I don't know that that has ever been
tested in the courts. Do you know if it has?
Mr. Simmons. My understanding--well, yes, I don't know. I
mean Section 103 says that EPA has the authority to ``establish
a national research and development program for the prevention
and control of air pollution.'' It says it is a national
program. It doesn't----
Mr. Whitfield. Right.
Mr. Simmons. By not explicitly limiting EPA's----
Mr. Whitfield. Right.
Mr. Simmons [continuing]. Authority----
Mr. Whitfield. Yes. Yes.
Mr. Simmons [continuing]. Is why we are in the situation--
--
Mr. Whitfield. And Ms. Derby, all of us have heard of
Winrock International and we know that you all do great work
and that you are here testifying you are not trying to hide
anything. And on your Web site it talks about and you have said
in your testimony you received grants from the Federal
Government, and you list agencies that you have received grants
from. How much would you say that you receive a year in grants
from the Federal Government for Winrock?
Ms. Derby. I don't have that number but I would estimate
that at least $60 million a year.
Mr. Whitfield. Sixteen million, OK.
Ms. Derby. Sixty. Sixty.
Mr. Whitfield. Oh, 60 million.
Ms. Derby. Yes, it fluctuates----
Mr. Whitfield. Yes.
Ms. Derby [continuing]. From year----
Mr. Whitfield. Because I know you have foundations that
support you and----
Ms. Derby. Um-hum.
Mr. Whitfield [continuing]. Even Federal agencies outside
the U.S. and so forth. But I am glad that you and Dr. Light are
here because, as I said in my opening statement, this is more
symbolic than anything else. We have a gigantic Federal debt
and everyone that comes up here to testify, they always say I
agree that we need to be more focused on reducing our debt, but
anytime we ever come up with even a minor way to do it,
everyone says, oh, my God, we can't do that. And now, here we
are talking about EPA. They have a budget over $8 billion a
year and we are talking about less than 1 percent of that on
these 103 grants. And I mean I find it difficult to believe in
all the hearings that I have been a part of listening to EPA
testify up here, all of their programs, that they would be
damaged in any significant way or that the American people
would be damaged in any significant way by eliminating these
grants. Obviously, you don't feel that way, Dr. Light, and I
guess you don't feel that way either. Is that right, Ms. Derby?
Ms. Derby. Yes. Can I respond?
Mr. Whitfield. Sure.
Ms. Derby. Yes, so all of Winrock's household energy
technical training work has been funded by EPA, and so if this
legislation should pass, then that possibility going forward
would be eliminated but not just for Winrock, for all of the
improved cookstoves sector. And because EPA is a leading,
recognized expert in indoor air quality, their involvement has
been very important to the sector.
Mr. Whitfield. Let me just interject here. Mr. McKinley
talked about this and he talks about it every hearing, every
time EPA comes up here we talk about indoor air quality being
worse than outdoor air and they seldom, if ever, focus any
attention on indoor air, and yet, through these grants, they
are concerned about indoor air problems outside the U.S.
Ms. Derby. Well, I can't represent EPA but I know EPA does
work on indoor air quality in the United States.
Mr. Whitfield. Not much. Not much.
Ms. Derby. I would have to defer to EPA on----
Mr. Whitfield. Does anybody else have any comment? My time
is expiring. Yes?
Mr. Light. Mr. Chairman, I think there is certainly a place
for, you know, putting forth some piece of legislation to make
the symbolic argument you are making. I think the consensus
view that Ms. Derby and I have and many of the people who work
in this area and my review of the scientific literature is
that, unfortunately, the impact would not be symbolic, that it
effectively would have a very big impact on our ability to
fight----
Mr. Whitfield. Yes.
Mr. Light [continuing]. Pollution that is harming
Americans. And it might sound like a very small amount of money
from the EPA budget, but as you say, the EPA budget is very
large. And so compared to what a lot of other countries come
into efforts like this, even a small amount of our budget
actually goes quite a long way, especially with respect to
leveraging private finance, even increase the pots of----
Mr. Whitfield. Yes.
Mr. Light [continuing]. Money available for reducing these
pollutants.
Mr. Whitfield. Thank you. Dr. Kreutzer?
Mr. Kreutzer. Yes. Again, I would like to take a somewhat
bigger picture view. I don't have any problem, I don't think,
with our cookstove at our house because it is electric. And it
is electric because we have economic growth and we have power
plants I think in Virginia--probably the majority is from coal.
And while it is noble and I think a good idea to improve the
cookstoves that are using gathered wood or dung or whatever the
source may be, it is ironic that at the same time that the EPA
is funding this project, they are working so hard to prevent
the electrification or the use of coal that can provide a much
cleaner indoor environment by allowing people--\1/3\ as I
mentioned in India don't even have electricity; one of the
cheapest sources of electricity for them will be coal--but we
have almost a jihad against coal here in the U.S. spearheaded
by the EPA. So I think it would be more consistent if they were
really worried about indoor air pollution to come up with ways
to help the developing world to get electricity that is
affordable and reliable.
Mr. Whitfield. Yes, very good.
Mr. Rush, you are recognized for 5 minutes.
Mr. Rush. I agree with Dr. Light that this is more than
just symbolism. To spend this much time on a bill using these
resources, I hope that it is not just about symbolism. But Dr.
Kreutzer, you raise some interesting points. You know, you kind
of rattled me a little bit. He accused us of trying to bribe
foreign governments with these funds. How do you react to that?
How do you react to his whole statement?
Mr. Light. Yes, sir. I would not agree with Mr. Kreutzer
that these are bribes that we are giving to other governments.
I don't think that that is way the fundamental leveraging of
finance works out in these cases. Sort of the trajectory of his
argument was that this was the camel's nose under the tent and
what is down the road is by 2020 this Green Climate Fund, which
is supposed to raise the bulk of the commitments for $100
billion, but the way that Mr. Kreutzer characterized this in
his testimony, there were just many errors. He says, for
example, that the U.S. is expected to make the biggest
contribution to international climate finance. Well, while some
people might expect that, that certainly isn't how this
administration has characterized what they plan on contributing
to funds like these.
He also suggested towards the end of his testimony that
setting up these big funds like this will require developed
countries to contribute hundreds of billions of dollars, and
that is just simply not the way they are set up. In fact, if
you look at the Green Climate Fund and many of the other
climate funds around the world, including the current ones that
exist in World Bank and others, the United States has always
said public money cannot be used to fill all these coffers.
That is the consistent position of this administration. And the
United States, in fact, held up the implementing document for
the Green Climate Fund before last year's Climate Summit in
Durbin because it did not sufficiently allow for private
investment to be one of the key factors of how this one was
going to move forward. In fact, the United States held up the
document and said we will not agree to signing onto this
document moving forward until there is a significant portal for
private investment going forward.
This is how the United States looks at this, and so I think
to characterize this as just a big public giveaway globally is
just simply false. It is the case that because we are talking
about countries that have excruciating development needs that
they are going to need some assistance to leverage adequate
amounts of money to deal with these problems, and the good part
is is that we all absolutely benefit from this. And I think the
numbers are absolutely clear.
Mr. Kreutzer. Can I chime in since you are talking about my
testimony?
Mr. Rush. Mr. Chairman, I have the time.
Ms. Derby, I am very, very excited about your program and
what you do and what Winrock does across the world, and when
you talked about the cookstoves, I recall a time when I was in
Chiapas, Mexico, and we walked into this little hut and the
smoke, we could not really understand how they could stay in
this one-room hut with this cookstove, and it was just so much
smoke. The smoke was so thick and here you had babies and
little children, you know, in and out of that place. So I mean
that picture is driven in my mind. So can you tell me a little
bit about or can you describe the breadth of support for your
work? How many other international organizations support this
kind of work? The chairman indicated that you had foundations
supporting this kind of work. How much of an international
initiative does the matter of cookstoves engender around the
world, how much support around the world?
Ms. Derby. Well, there are numerous improved cookstove-
related programs around the world. Many are funded by U.S.
government agencies. When the Global Alliance for Clean
Cookstoves was launched, there was a $53 million commitment by
the U.S. Government. About half of that was committed by CDC
and NIH for health studies and the rest was committed between
the Department of Energy, Department of State, USAID and EPA.
The World Bank also works on improved cookstove-related and
household energy work, as do smaller foundations fund this kind
of work. At Winrock, our primary work with improved cookstoves
and household energy in general has been through USAID and EPA
funding.
Mr. Rush. So if in fact this bill were to become law, then
it would have a cascading effect or reverberation on these
other programs and these other initiatives around the world. Is
that correct?
Ms. Derby. I believe so because EPA has been a pioneering
leader in the sector and has been able to leverage the
involvement of other U.S. Government and international
agencies. And so to have EPA suddenly pull out from the sector
would be a tremendous blow to the sector.
Mr. Rush. What would it do to our foreign image, I mean our
image around the world as it relates to being a leader in terms
of environmental----
Ms. Derby. Well, the U.S. is definitely, thanks to EPA,
currently recognized as a leader in household energy and indoor
pollution and cookstoves work. Right now, the EPA is funding
technical trainings around the world to help people learn to
make better cookstoves and make sure that they work right. You
can't tell by looking at a cookstove if it works right; you
have to test it. So all of this training that we are doing
increases U.S. visibility and goodwill abroad by us helping
these producers to make their stoves better and thereby improve
health and livelihood for families.
Mr. Whitfield. Gentleman's time is expired.
At this time, I would like to recognize the gentleman from
Virginia, Mr. Griffith.
Mr. Griffith. Thank you, Mr. Chairman.
Dr. Kreutzer, nice to see you and welcome you here. You, a
couple times, wanted to make some comments in the last couple
of minutes and I am going to give you that opportunity.
Mr. Kreutzer. Well, thank you.
First, and I will talk about the most recent topic which is
these cookstoves and I think it is a noble initiative. The
trouble is the EPA seems to want to create a world that is
ideal for subsistence farmers. As we want to help them with the
technologies that they had when they were poor, we do not want
to help promote technologies and energy sources that are going
to allow them to become rich. And I think that is misguided. As
a great a problem as I think the one you have now is, ignoring
the second half is even worse, in greater magnitude.
Dr. Light accused me of making some misrepresentations
regarding these global funds. He said the administration does
not want public funds to go to them. The administration
supported the Waxman-Markey bill, the Kerry-Boxer bill, the
Kerry-Lieberman bill, all of which had provisions for sending
funds to these foreign programs. They were not actually tax
dollars because they used the disingenuous plan of calling
something ``allowances.'' That is energy producers would have
to buy allowances. That would generate funds and it is those
funds that are going overseas.
That is exactly--and if you talk to all the economists,
they agree--it works very much like a CO2 tax and we can call
those allowances CO2 tax or revenues. Every person I know that
did modeling on both sides of the aisle of the cap-and-trade
bills regarded those as carbon taxes. Maybe officially they
weren't but sending money from energy consumers in the U.S. to
foreign countries to try to get them to do something they
clearly don't want to do because it is going to be very costly
in terms of limiting their growth I think is a bad idea and I
think it was hidden in these negotiations. I don't think they
advertised the fact that there was going to be a big amount of
money transferred.
Mr. Griffith. Mr. Simmons, if I might, and it is one of
those things that sometimes happens. I think I misheard your
testimony so I want to make sure that it is clear because then
when I went back to read it because I thought it was a really
good point, I read it differently than I heard it. So let me
make sure I get it clear. In your testimony you stated that in
regard to the Mercury and Toxic Standards Rule that the EPA Web
site indicates that it costs $10 billion a year and then what I
thought I heard you say was was that the EPA said that it had a
value of $6 billion. But I noticed in your written testimony
that it is an ``M.'' I am assuming your written testimony so it
is a $6 million benefit. I am assuming your written testimony
is correct and that I just wasn't paying enough attention.
Mr. Simmons. I could have easily misspoken. In EPA's
regulatory impact analysis, the cost of the Mercury and Air
Toxics Standard is $10 billion a year. The benefits for
reducing mercury are between 500,000 and $6 million with an
``M.''
Mr. Griffith. And so that does leave a huge amount of money
that could be used for other projects. And I see this all the
time where it appears that the EPA is either making others
spend a lot of money or they are spending money and yet we
could take that money and use it for something that really
matters like the cookstoves and do things in this country. And
then I also liked your point in regard to the economic
situations because my district is being hit very hard by what I
believe Dr. Kreutzer--I always called it the War on Coal--used.
What was it? Armageddon on Coal? What was the term you used?
Mr. Kreutzer. I didn't mean to bring in a religious
component----
Mr. Griffith. Let me go back to my War on Coal.
Mr. Kreutzer. War is fine.
Mr. Griffith. But, you know, we are on the frontlines of
that. We lost another 620 jobs just last week that are idled.
Hopefully, they will come back in the not-too-distant future.
But prior to that, we have had over 1,000 people in the region
that have been laid off from various mines, and, you know, it
is interesting because we are talking about the cookstoves in
Third World countries but I envision in a cold winter--and we
did not have a cold winter this last winter--a lot of folks in
my district are going to have to live in one room even if that
have a multi-room house with some type of a small little
heater, probably either electric or kerosene because they can't
afford to heat the whole house to a level that is comfortable,
and even in that small room they are going to have to be
bundled up. And does that not have greater effect, Mr. Simmons,
on the health of those individuals than the value of the MATS
compared with the $10 billion a year?
Mr. Simmons. It has a large impact. I mean there is a great
discrepancy between the health outcomes of the poor versus the
rich and it has everything to do with which rich people and
rich countries can afford more environmental amenities than
poor people in poor countries. And so the point is the richer
we are as people, the richer we are as a country, the safer we
are and the better our environment is.
Mr. Griffith. And Mr. Chairman, I see my time is up and I
yield back.
Mr. Whitfield. Thanks very much, Mr. Griffith.
And I want to thank all four of you for taking time to come
up today and talking about this legislation and the impact that
it would have from your perspective. We appreciate your time
once again. And we are going to keep this record open for at
least 10 days if you have any additional material that anyone
would like to put in, the record will be open.
And Mr. Rush, do you have anything else?
Mr. Rush. No, nothing else.
Mr. Whitfield. Sorry we are not going to have a hearing
tomorrow.
But anyway, thank you all very much and we look forward to
working with you as we decide whether to move forward or not.
Thank you very much.
Hearing is concluded.
[Whereupon, at 1:05 p.m., the subcommittee was adjourned.]
[Material submitted for inclusion in the record follows:]
[GRAPHIC] [TIFF OMITTED] 82931.122
[GRAPHIC] [TIFF OMITTED] 82931.123
[GRAPHIC] [TIFF OMITTED] 82931.124
[GRAPHIC] [TIFF OMITTED] 82931.125
[GRAPHIC] [TIFF OMITTED] 82931.126
[GRAPHIC] [TIFF OMITTED] 82931.127
[GRAPHIC] [TIFF OMITTED] 82931.128
[GRAPHIC] [TIFF OMITTED] 82931.129
[GRAPHIC] [TIFF OMITTED] 82931.130
[GRAPHIC] [TIFF OMITTED] 82931.131
[GRAPHIC] [TIFF OMITTED] 82931.132
[GRAPHIC] [TIFF OMITTED] 82931.133
[GRAPHIC] [TIFF OMITTED] 82931.134
[GRAPHIC] [TIFF OMITTED] 82931.135
[GRAPHIC] [TIFF OMITTED] 82931.136
[GRAPHIC] [TIFF OMITTED] 82931.137
[GRAPHIC] [TIFF OMITTED] 82931.138