[Senate Hearing 112-440]
[From the U.S. Government Publishing Office]



                                                        S. Hrg. 112-440

 
    ENERGY AND WATER DEVELOPMENT APPROPRIATIONS FOR FISCAL YEAR 2012

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

                                HEARINGS

                                before a

                          SUBCOMMITTEE OF THE

            COMMITTEE ON APPROPRIATIONS UNITED STATES SENATE

                      ONE HUNDRED TWELFTH CONGRESS

                             FIRST SESSION

                                   ON

                               H.R. 2354

 AN ACT MAKING APPROPRIATIONS FOR ENERGY AND WATER DEVELOPMENT FOR THE 
     FISCAL YEAR ENDING SEPTEMBER 30, 2012, AND FOR OTHER PURPOSES

                               __________

                      Department of Defense--Civil
                          Department of Energy
                       Department of the Interior
                       Nondepartmental Witnesses

                               __________

         Printed for the use of the Committee on Appropriations


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        committee.action?chamber=senate&committee=appropriations



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                               __________


                      COMMITTEE ON APPROPRIATIONS

                   DANIEL K. INOUYE, Hawaii, Chairman
PATRICK J. LEAHY, Vermont            THAD COCHRAN, Mississippi, Ranking
TOM HARKIN, Iowa                     MITCH McCONNELL, Kentucky
BARBARA A. MIKULSKI, Maryland        RICHARD C. SHELBY, Alabama
HERB KOHL, Wisconsin                 KAY BAILEY HUTCHISON, Texas
PATTY MURRAY, Washington             LAMAR ALEXANDER, Tennessee
DIANNE FEINSTEIN, California         SUSAN COLLINS, Maine
RICHARD J. DURBIN, Illinois          LISA MURKOWSKI, Alaska
TIM JOHNSON, South Dakota            LINDSEY GRAHAM, South Carolina
MARY L. LANDRIEU, Louisiana          MARK KIRK, Illinois
JACK REED, Rhode Island              DANIEL COATS, Indiana
FRANK R. LAUTENBERG, New Jersey      ROY BLUNT, Missouri
BEN NELSON, Nebraska                 JERRY MORAN, Kansas
MARK PRYOR, Arkansas                 JOHN HOEVEN, North Dakota
JON TESTER, Montana                  RON JOHNSON, Wisconsin
SHERROD BROWN, Ohio

                    Charles J. Houy, Staff Director
                  Bruce Evans, Minority Staff Director
                                 ------                                

              Subcommittee on Energy and Water Development

                 DIANNE FEINSTEIN, California, Chairman
PATTY MURRAY, Washington             LAMAR ALEXANDER, Tennessee
TIM JOHNSON, South Dakota            THAD COCHRAN, Mississippi
MARY L. LANDRIEU, Louisiana          MITCH McCONNELL, Kentucky
JACK REED, Rhode Island              KAY BAILEY HUTCHISON, Texas
FRANK R. LAUTENBERG, New Jersey      RICHARD C. SHELBY, Alabama
TOM HARKIN, Iowa                     SUSAN COLLINS, Maine
JON TESTER, Montana                  LISA MURKOWSKI, Alaska
RICHARD J. DURBIN, Illinois          LINDSEY GRAHAM, South Carolina
DANIEL K. INOUYE, Hawaii (ex         DANIEL COATS, Indiana
    officio)

                           Professional Staff

                               Doug Clapp
                             Roger Cockrell
                         Franz Wuerfmannsdobler
                    Carolyn E. Apostolou (Minority)
                         Tyler Owens (Minority)
                       LaShawnda Smith (Minority)

                         Administrative Support

                          Molly Barackman-Eder


                            C O N T E N T S

                              ----------                              

                       Wednesday, April 13, 2011

                                                                   Page

Department of Defense--Civil: Department of the Army: Corps of 
  Engineers--Civil...............................................     1
Department of the Interior: Bureau of Reclamation................    18

                         Wednesday, May 4, 2011

Deparment of Energy: National Nuclear Security Administration....    91

                        Wednesday, May 18, 2011

Department of Energy.............................................   125
Material Submitted Subsequent to the Hearing.....................   199

                       Nondepartmental Witnesses

Department of Defense--Civil: Department of the Army: Corps of 
  Engineers--Civil...............................................   201
Department of Energy.............................................   224
Department of the Interior: Bureau of Reclamation................   308


    ENERGY AND WATER DEVELOPMENT APPROPRIATIONS FOR FISCAL YEAR 2012

                              ----------                              


                       WEDNESDAY, APRIL 13, 2011

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 2:10 p.m., in room SD-192, Dirksen 
Senate Office Building, Hon. Dianne Feinstein (chairman) 
presiding.
    Present: Senators Feinstein, Johnson (SD), Landrieu, Reed, 
Lautenberg, Harkin, Tester, Alexander, Cochran, Collins, 
Murkowski, and Graham.

                      DEPARTMENT OF DEFENSE--CIVIL

                         Department of the Army

                       Corps of Engineers--Civil

STATEMENT OF HON. JO-ELLEN DARCY, ASSISTANT SECRETARY 
            OF THE ARMY (CIVIL WORKS)


             opening statement of senator dianne feinstein


    Senator Feinstein. The hearing will come to order.
    I would like to apologize for being late. I thought I would 
tune in to the President's address, that there would be some 
specifics and after a while I thought uh-oh, I better go to the 
hearing. So here I am, and I want to thank everybody here for 
being patient.
    I want to welcome our witnesses. I happen to be a big fan 
of the Army Corps of Engineers (COE), and particularly all the 
dredging, the levee protection, the river protection, 
everything that you do in California to enable us to exist is 
critical.
    Mike Connor, who is the Commissioner of the Bureau of 
Reclamation (BOR) has done excellent work. I am a big fan in 
what is a tough area in California. No adage has ever been 
truer than ``whiskey is for drinking and water is for 
fighting'', and California puts that into action every year. So 
I thank you for being a problem-solver rather than a problem-
maker.
    We all recognize, I think, the difficult fiscal environment 
we are in. However, we also realize that our economy is 
fragile, still recovering, and could turn the wrong way, so we 
want to do our very best to see that those agencies that 
stimulate economic and job growth and protect the safety of our 
communities are themselves protected.
    COE and BOR are the agencies we depend on to build the 
water infrastructure that moves our Nation's cargo, protects 
our cities from flooding, provides irrigation water and 
hydropower, and facilitates much needed environmental 
restoration. Not only does the work of these agencies provide 
jobs now, the infrastructure that is constructed continues to 
benefit the economy for decades. It is amazing.
    Unfortunately, the budget request reflects the consistent 
underfunding that we have seen in prior years, and I must say I 
am very disappointed in our part of the continuing resolution 
which takes another whack at COE.
    The President's fiscal year 2012 budget for COE is $4.6 
billion. That is 15 percent below the 2010 enacted amount. Two 
major project accounts for the Department of the Interior under 
the jurisdiction of this subcommittee are proposed at $1.05 
billion, which is 7 percent below the fiscal year 2010 enacted 
amount. That is a lot. So this is a tough budget for both 
agencies.
    For COE, the top six construction projects account for $737 
million of the $1.48 billion requested for construction work. 
That is 51.8 percent of the total. The other 79 construction 
projects--79--compete for the remaining 48 percent of funds.
    In the general investigation account, 75 percent of the 
funding is directed to national programs and two individual 
studies. The other 63 studies proposed will have to compete for 
25 percent of the funds.
    In BOR's budget, I am pleased to see the administration 
propose a new account for the San Joaquin River restoration. 
The $9 million in discretionary funding, along with the 
mandatory funding under the joint settlement agreement between 
the Federal Government, the State, and the water contractors 
will assure that water impacts are reduced or avoided while 
maintaining the San Joaquin River ecosystem.
    Rural water projects are funded in both the water and 
related resources account and the proposed new Indian water 
rights account for fiscal year 2012. There are seven ongoing 
rural water projects proposed at $35.5 million from the water 
and related resources account for 2012. All of these benefit 
various tribes. The new Indian water rights account proposes 
$51.5 million for four similar new projects. One has to wonder 
whether these funds can be effectively used for these new rural 
water systems in fiscal year 2012. That will be something for 
us to look into.
    So I want to welcome Jo-Ellen Darcy, the Assistant 
Secretary of the Army (Civil Works), Lieutenant General Robert 
L. Van Antwerp, the Chief of Engineers for the United States 
Corps of Engineers. And from the Department of the Interior, we 
will hear from Anne Castle, the Assistant Secretary for Water 
and Science, and the wonderful Mike Connor, Commissioner of the 
Bureau of Reclamation.
    Now before formally introducing you, I would like to 
indicate my great pleasure in introducing my ranking member for 
this. We worked together on the Interior Committee and it was 
very easy to do. We were able to work out any issue, and you 
are really a gentleman, Lamar, and in this arena that is doubly 
appreciated. You get double points. So I thank you for being 
you, and I am delighted to recognize you for your remarks.


                  STATEMENT OF SENATOR LAMAR ALEXANDER


    Senator Alexander. Thank you, Madam Chairman. It is a treat 
to work with you. Thank you for the compliment. What I 
especially like about Senator Feinstein is she was a mayor. She 
can make decisions and she speaks with precision. So it is easy 
to work with her. And we have many of the same values and 
judgments about the future of our country.
    Senator Feinstein said that whiskey is for drinking and 
water is for fighting in the West, and all across our country, 
I think all of us are here today because we know that inland 
waterways and locks are for creating private sector jobs. And 
that is really the number one goal we have got in this country 
no matter where we are from.
    I want to thank the chair for holding this hearing and 
thank all the distinguished leaders of the Departments for 
coming. COE has been around since the Revolutionary War. It 
touches the lives of every American, keeps our inland waterways 
open and running, manages our drinking water, provides 
emission-free electricity, looks after recreational waters, and 
as Tennesseans found out last year during our flood, helps us 
manage river levels during serious flooding. It does many 
things well, but we want to be in a position to help COE do 
things even better and jobs are a good place to start.
    The Nation's inland waterways do not get on the front pages 
as much, but they keep trucks off our highways. They result in 
lower fuel costs at a time when fuel is going up. They reduce 
the cost of repairing roads. Barges can carry a ton of freight 
576 miles on a gallon of fuel compared to the 150 miles per 
gallon a truck can carry a ton of freight. And one barge of dry 
cargo can displace as many as 70 trucks, putting that freight 
on our waterway and taking it off our crowded interstate.
    We think of the Chickamauga Lock in the Chattanooga area of 
Tennessee. If it were to close, which it has a real risk of 
doing if it is not replaced, it would put 100,000 big trucks on 
I-75. If COE is committed to mothball projects, it would expand 
the amount of freight on our waterways. In fact, the only 
inland waterways project COE has prioritized is years past its 
planned completion date, hundreds of millions of dollars over 
budget, with still no end in sight. We have to find a solution 
that expands our current locks and gets new ones built.
    One of the things that I want to talk about today when my 
question time comes is that industry, commercial users, came to 
COE in good faith in 2008, attempted to find a solution to put 
more money in the Inland Waterways Trust Fund, only to have COE 
appear to walk away from the documented help draft and condemn 
the report's findings. I would like to have some answers about 
why that happened. What could have been a great example about 
how industry and Government could work together turned out to 
be a cautionary tale about a fickle Government dealing with an 
industry.
    So the questions, Madam Chair, that I will be asking are 
how do we fix the trust fund and make sure that projects like 
Chickamauga Lock get built. Are we doing all we can to utilize 
our ports and harbors? We need to examine how we are managing 
the Harbor Maintenance Trust Fund. The President said his goal 
in the State of the Union Address was to double exports. It is 
going to be hard to do unless we provide adequate funding for 
dredging our ports and harbors. And then what are the specific 
factors driving decisionmaking on COE projects? We need to ask 
for detailed examinations and explanations of how decisions are 
made and the process by which certain projects are deemed 
priorities.
    This is an important hearing. I am glad to be a part of it. 
And I look forward to hearing from the witnesses.
    Thank you, Madam Chair.
    Senator Feinstein. And I thank you, Senator.
    From the Department of the Interior, we will hear from Anne 
Castle, the Assistant Secretary for Water and Science.
     General Antwerp, it is my understanding that this is going 
to be your last appearance before the subcommittee as you will 
be retiring next month. So you can give us the true, 
unvarnished truth, as you see it.
    We will expect nothing less. I want to thank you for your 
many years of service to our Nation. I look forward to working 
with your successor, General Bostick, once he is confirmed.
    I want to remind the witnesses that your full statements 
will be in the record, and I hope you will just provide a brief 
summary of what you are saying. And then we will go the early 
bird rule, and I will alternate sides in recognizing Senators.
    Senator Cochran. Madam Chairman, could I ask unanimous 
consent that a statement appear at this point in the record?
    Senator Feinstein. You certainly may, and all statements 
will be put in the record.
    [The statement follows:]

               Prepared Statement of Senator Thad Cochran

    Madam Chairman, thank you for convening this hearing to review the 
administration's fiscal year 2012 budget request for the Army Corps of 
Engineers (COE) and Bureau of Reclamation. I am pleased to join you in 
welcoming the panel for attending today's hearing.
    My State is fortunate to border such prominent bodies of water as 
the Mississippi River and the Gulf of Mexico, which are both vital to 
our domestic economy for shipping and travel. Our relationship with the 
Corps of Engineers has enabled Mississippi and its neighboring States 
to benefit from access to these waters while also benefiting from COE-
built levees, dams, and locks which safeguard against floods. COE has 
also been very helpful over the years in helping Mississippi address 
many of its aging wastewater infrastructure issues throughout our 
State. Flood control, port dredging, and environmental infrastructure 
projects are very important to our State, and we appreciate your 
responding to these needs.
    The fiscal year 2012 proposal for the Mississippi River and its 
tributaries has caused concern among commodity exporters who worry 
about COE's ability to maintain the Mississippi River channel at 
authorized depths. The Mississippi River System enables more than $100 
billion in exports to traverse its waters annually. Thousands of jobs 
rely on a fully functioning river system, and I hope COE will continue 
to respond to these national and local interests.
    I look forward to your testimony, and to working with you during 
the coming year.

    Senator Feinstein. Secretary Darcy, would you begin please?

                  SUMMARY STATEMENT OF JO-ELLEN DARCY

    Ms. Darcy. Madam Chairman and distinguished members of the 
subcommittee, thank you for the opportunity to present the 
President's fiscal year 2012 budget for the civil works program 
of COE.
    The budget requires new appropriations of $4.631 billion. 
In keeping with the administration's program to put the Nation 
on a sustainable fiscal path, this is $836 million, or about 15 
percent, below the 2010 enacted amount of $5.445 billion. It is 
about a 6 percent reduction from the 2011 budget for the civil 
works program.
    The budget concentrates funding primarily in the three 
civil works program areas: commercial navigation, flood and 
coastal storm damage reduction, and aquatic ecosystem 
restoration.
    The 2012 budget continues the Army's commitment to a 
performance-based approach to budgeting in order to provide the 
best overall return from available funds in achieving economic, 
environmental, and public safety objectives.
    The budget provides $50 million for a comprehensive levee 
safety initiative to help ensure that Federal levees are safe 
and to assist non-Federal entities as they address safety 
issues with their own levees.
    The operation and maintenance program also includes a new 
environmental and energy sustainability program to reduce 
energy consumption at COE projects and buildings.
    The 2012 budget places priority on collaboration with other 
Federal agencies in the development of funding allocations for 
aquatic ecosystem restoration. For 2012, this collaboration is 
reflected in five major ecosystems:
  --the California Bay-Delta;
  --Chesapeake Bay;
  --the Everglades;
  --the Great Lakes; and
  --the gulf coast.
    The budget provides for use of $758 million from the Harbor 
Maintenance Trust Fund to maintain coastal commercial 
navigation channels and harbors.
    The administration plans to develop legislation to expand 
the authorized uses of the Harbor Maintenance Trust Fund so 
that its receipts are available to finance the Federal share of 
other efforts in support of commercial navigation through our 
Nation's ports. No decisions have been made yet on what 
additional costs would be proposed to be paid from this Harbor 
Maintenance Trust Fund.
    Inland waterways capital investments are funded in the 
budget at $166 million, of which $77 million is financed from 
the Inland Waterways Trust Fund. This is the total amount that 
is affordable in 2012 with the current level of revenue coming 
into the trust fund. The administration will work with the 
Congress and stakeholders to authorize a new mechanism to 
increase the revenue paid by commercial navigation users of the 
inland waterways.
    The administration also plans to work with the Congress and 
stakeholders to explore ways to support broader 
recapitalization of COE's aging infrastructure, modification of 
its operations, or deauthorization as appropriate, consistent 
with our modern day water resources principles and priorities.
    Last year, President Obama established the America's Great 
Outdoors initiative to promote innovative community-level 
efforts to conserve outdoor spaces and to reconnect Americans 
to the outdoors. The Civil Works recreation program is closely 
aligned with the goals of the America's Great Outdoors 
initiative and includes a variety of activities to reconnect 
Americans, especially our young people, with the Nation's 
outdoor resources.
    We continue to strengthen COE's planning expertise, 
including through greater support for our planning centers of 
expertise and continued support for the development of revised 
water project planning principles and guidelines.
    A number of lower-priority programs and activities receive 
reduced or no funding in our 2012 budget. For example, funding 
for maintenance of navigation harbors and waterway segments 
that support little or no commercial use is reduced by about 
one-half. Also, no funding is provided for small projects in 
several of the continuing authorities programs. The budget 
proposes to reprogram $25 million of prior year funds from 
these lower-priority programs to finance ongoing phases of 
projects in higher-priority continuing authorities programs.
    In summary, the President's budget for 2012 for the Army 
Civil Works program is a performance-based budget. It supports 
water resources investments that will yield long-term returns 
for the Nation.
    Madam Chairman and members of the subcommittee, I look 
forward to working with you in support of the President's 
budget.

                           PREPARED STATEMENT

    And if you would indulge me for about 30 seconds, I would 
like to personally thank General Van Antwerp for his years of 
service. I came into this job a year and a half ago and I could 
not have asked for a better partner and a better leader for 
COE, and he will be sorely missed. So thank you.
    [The statement follows:]

                  Prepared Statement of Jo-Ellen Darcy

    Madam Chairman and distinguished members of the subcommittee, thank 
you for the opportunity to present the President's budget for the Civil 
Works program of the Army Corps of Engineers (COE) for fiscal year 
2012.

                       coe deg.OVERVIEW

    The fiscal year 2012 budget for the Civil Works program reflects 
the administration's priorities through targeted investments in the 
Nation's infrastructure that help restore the environment and 
revitalize the economy, while also reflecting the need to put the 
country on a fiscally sustainable path. With those tenets in mind, the 
primary objectives of the budget are as follows:
  --Focus funding on water resources infrastructure projects that 
        produce high economic and environmental returns to the Nation 
        and those that address public safety needs.
  --Restore high-priority ecosystems such as the California Bay-Delta, 
        Chesapeake Bay, the Everglades, the Great Lakes, and the gulf 
        coast.
  --Support a comprehensive levee safety initiative to help ensure that 
        Federal levees are safe and to enhance efforts to assist non-
        Federal parties to address safety issues with their levee 
        systems.
  --Provide priority funding to the maintenance of high-performing 
        projects.
  --Propose changes in the way Federal activities in support of 
        commercial navigation through the Nation's ports are funded, 
        and support increases in inland waterways receipts.
  --Improve the way in which COE addresses the Nation's most pressing 
        water resources challenges.
  --Increase the organizational efficiency and improve the management, 
        oversight, and performance of ongoing programs.
    The budget concentrates funding for development and restoration of 
the Nation's water and related resources within the three main Civil 
Works program areas:
  --commercial navigation;
  --flood and coastal storm damage reduction; and
  --aquatic ecosystem restoration.
    Additionally, the budget supports hydropower, recreation, 
environmental stewardship, and water supply services at existing water 
resources projects owned or operated by COE. Finally, the budget 
provides for protection of the Nation's regulated waters and wetlands; 
cleanup of sites contaminated as a result of the Nation's early efforts 
to develop atomic weapons; and emergency preparedness. The budget does 
not fund work that should be the responsibility of non-Federal 
interests or other Federal agencies, such as water and wastewater 
treatment projects.

     coe deg.FISCAL YEAR 2012 DISCRETIONARY FUNDING LEVEL

    The budget provides gross new discretionary funding of $4.631 
billion, which will keep the Civil Works program moving forward to help 
revitalize the economy, and provide for restoration and stewardship of 
the environment. The budget also proposes cancellation of the $57 
million in unobligated funding previously provided in the Mississippi 
River and Tributaries account for construction of the Yazoo Backwater 
Pumps, Mississippi project. This cancellation would achieve $57 million 
in real savings for the American taxpayer. Of the amount proposed to be 
cancelled, $22 million is an offset to fiscal year 2012 gross 
appropriations, for a net request of $4.609 million. (The Congress 
appropriated the remaining $35 million to ``restore'' funds that COE 
had ``borrowed'' under the Stafford Act while responding to a natural 
disaster at another project. Because the Congress restored these funds 
in an emergency supplemental appropriation, their cancellation does not 
``score'' as an offset to our discretionary funding request.)
    In keeping with the administration's program to put the Nation on a 
sustainable fiscal path, the funding for Civil Works in the 2012 budget 
is $836 million, or about 15 percent, below the enacted amount of 
$5.445 billion in fiscal year 2010. It is about 6 percent below the 
fiscal year 2011 budget level. The fiscal year 2012 funding level 
reflects a considered, practical, effective, and sound use of available 
resources, focusing on those investments that are in the best interest 
of the Nation.
    Within the $4.631 billion recommended gross appropriations, $1.48 
billion is for projects in the Construction account, and $2.314 billion 
is for activities funded in the Operation and Maintenance (O&M) 
account. The budget also includes $104 million for Investigations; $210 
million for Mississippi River and Tributaries; $27 million for Flood 
Control and Coastal Emergencies; $196 million for the Regulatory 
Program; $109 million for the Formerly Utilized Sites Remedial Action 
Program; $185 million for the Expenses account; and $6 million for the 
Office of the Assistant Secretary of the Army (Civil Works). Attachment 
1 shows this funding by account and by program area.

                                        ATTACHMENT 1.--FISCAL YEAR 2012 BUDGET--BUSINESS LINE/ACCOUNT CROSS-WALK
                                                                [In millions of dollars]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                      Funding Categories
                                    --------------------------------------------------------------------------------------------------------------------
                                                                               MR&T
           Business Lines                                      ------------------------------------                                       OASA
                                        I        C       O&M                                TOTAL    FUSRAP    FCCE     REG       E       (CW)    TOTAL
                                                                   I        C       O&M      MRT
--------------------------------------------------------------------------------------------------------------------------------------------------------
Flood and Coastal Storm Damage            48      721      523        1       63       91      155  .......  .......  .......  .......  .......    1,447
 Reduction.........................
    Coastal........................        7       23        8  .......  .......        3        3  .......  .......  .......  .......  .......       41
    Inland.........................       41      698      515        1       63       88      152  .......  .......  .......  .......  .......    1,406
Hydropower.........................  .......        6      176  .......  .......  .......  .......  .......  .......  .......  .......  .......      182
Navigation.........................       18      283    1,237  .......       13       24       37  .......  .......  .......  .......  .......    1,575
    Coastal........................        7      117      706  .......  .......        2        2  .......  .......  .......  .......  .......      832
    Inland.........................       11      166      531  .......       13       22       35  .......  .......  .......  .......  .......      743
Environment:
    Aquatic Ecosystem Restoration..       38      470       23  .......        2  .......        2  .......  .......  .......  .......  .......      533
    Stewardship....................  .......  .......       96  .......  .......        4        4  .......  .......  .......  .......  .......      100
    FUSRAP.........................  .......  .......  .......  .......  .......  .......  .......      109  .......  .......  .......  .......      109
Regulatory.........................  .......  .......  .......  .......  .......  .......  .......  .......  .......      196  .......  .......      196
Recreation.........................  .......  .......      247  .......  .......       12       12  .......  .......  .......  .......  .......      259
Emergency Management (incl. NEPP)..  .......  .......        7  .......  .......  .......  .......  .......       27  .......  .......  .......       34
Water Supply.......................  .......  .......        5  .......  .......  .......  .......  .......  .......  .......  .......  .......        5
Expenses...........................  .......  .......  .......  .......  .......  .......  .......  .......  .......  .......      185  .......      185
OASA(CW)...........................  .......  .......  .......  .......  .......  .......  .......  .......  .......  .......  .......        6        6
                                    --------------------------------------------------------------------------------------------------------------------
      TOTAL........................      104    1,480    2,314        1       78      131      210      109       27      196      185        6    4,631
--------------------------------------------------------------------------------------------------------------------------------------------------------
I=Investigations; C=Construction; O&M=Operation and Maintenance; MR&T=Flood Control, Mississippi River and Tributaries; FUSRAP=Formerly Utilized Sites
  Remedial Action Program; FCCE=Flood Control and Coastal Emergencies; REG=Regulatory Program; NEPP=National Emergency Preparedness Program; E=Expenses;
  OASA (CW)=Office of the Assistant Secretary of the Army (Civil Works).

    The fiscal year 2012 budget continues the Army's commitment to a 
performance-based approach to budgeting to provide the best overall 
return from available funds from a national perspective in achieving 
economic, environmental, and public safety objectives. Competing 
investment opportunities for studies, design, construction, and 
operation and maintenance were evaluated using multiple metrics, and 
objective performance criteria guided the allocation of funds.
    The fiscal year 2012 budget supports investments in flood and storm 
damage reduction, commercial navigation, environmental restoration, and 
other programs. The distribution of funding among these programs is 
similar to the distribution in the fiscal year 2011 budget, except that 
environmental restoration received a slightly lower proportion of 
overall funding. Of the total in the fiscal year 2012 budget, 31 
percent is allocated to flood and storm damage reduction; 34 percent is 
allocated to commercial navigation; 18 percent is allocated to 
environmental restoration and protection; and 17 percent is allocated 
among other program areas.

          coe deg.NEW INVESTMENTS IN FISCAL YEAR 2012

    The Civil Works budget includes funding for two construction new 
starts and several other new initiatives, as described below.
    In the Construction account, the budget includes $8 million for a 
new start for the Hamilton City project in California, which provides 
environmental restoration and flood damage reduction benefits. The 
budget also includes $3 million to initiate a storm damage reduction 
project along the New Jersey coast between Raritan Bay and Sandy Hook 
Bay in the Port Monmouth area.
    There are four new study starts in the Investigations account: Fish 
Passage at Englebright and Daguerre Point Dams on the Yuba River in 
California for $100,000; environmental restoration and flood damage 
reduction at Cano Martin Pena in Puerto Rico for $100,000; the 
Chesapeake Bay Comprehensive Plan for $250,000; and the Louisiana 
Coastal Area Comprehensive Plan for $100,000.
    The O&M program includes $12.3 million for a new environmental and 
energy sustainability program. This will involve developing tools to 
enable COE to meet Federal sustainability goals and implementing 
energy-saving measures at COE projects and buildings. The 38 Civil 
Works COE districts will compete for these funds by proposing specific 
measures to conserve energy. Lessons learned from this competition will 
inform future investments to increase environmental and energy 
sustainability of the Civil Works program.
    The budget provides $50 million for a comprehensive levee safety 
initiative. This initiative includes $46 million in the O&M account to 
continue and expand activities to help ensure that Federal levees are 
safe and to assist non-Federal entities to address safety issues with 
their levees. The levee safety initiative also includes $4 million in 
the Flood Control and Coastal Emergencies account. These funds will be 
used for COE participation in the expansion of interagency teams, known 
as Silver Jackets, to include every State, and to provide unified 
Federal assistance in implementing flood risk management solutions.

             coe deg.AQUATIC ECOSYSTEM RESTORATION

    The fiscal year 2012 budget places priority on collaboration with 
other Federal agencies in the development of funding allocations for 
aquatic ecosystem restoration. Attachment 2 provides a list of the 
ecosystems and funding amounts budgeted on this basis.

              FISCAL YEAR 2012 PRIORITY ECOSYSTEMS FUNDING
                        [In millions of dollars]
------------------------------------------------------------------------
 Ecosystem
  account               Projects and studies                  Amount
------------------------------------------------------------------------
           California Bay Delta:
     I \1\     Yuba River Fish Passage (new recon)                0.10
         I     San Pablo Bay Watershed Study                      0.50
     C \2\     Hamilton City (new start)                          8.00
   I/C/O&M     Additional studies and projects in                49.00
                Navigation and Flood Damage Reduction
                Pro-  grams
                                                       -----------------
                   Total, California Bay Delta                   58.00
                                                       =================
           Chesapeake Bay:
         I     Chesapeake Bay Comprehensive Study (new            0.25
                recon)
         C     Poplar Island                                     12.00
         C     Chesapeake Bay Oysters                             5.00
                                                       -----------------
                 Total, Chesapeake Bay                           17.00
                                                       =================
           Everglades:
         C     Continuing projects and activities               163.00
   O&M \3\     Continuing projects and activities                 5.00
                                                       -----------------
                 Total, Everglades                              168.00
                                                       =================
           Great Lakes:
         I     Interbasin control--(Great Lakes-Ms R              3.00
                Nuisance Species)
         C     Chicago sanitary and ship canal                   13.50
       O&M     Chicago sanitary and ship canal                   10.50
                                                       -----------------
                 Total, Great Lakes                              27.00
                                                       =================
           Gulf coast:
        GI     Louisiana coast comprehensive study                0.10
                (new recon)
        GI     LCA studies                                       16.00
        CG     LCA projects                                      10.60
                                                       -----------------
                 Total, Gulf coast                               27.00
------------------------------------------------------------------------
           \1\ I=Investigation
           \2\ C=Construction
           \3\ O&M=Operation and Maintenance.

    In connection with this effort, the budget provides $168 million 
for COE for the ongoing South Florida Everglades Restoration Program, 
consisting of $163 million for Construction and $5 million for O&M. The 
budget supports the continued construction of five ongoing aquatic 
ecosystem restoration projects in south Florida:
  --Picayune Strand;
  --Site One Impoundment;
  --Indian River Lagoon South;
  --Kissimmee River; and
  --the C-111 (South Dade) project.
    The budget also supports work on other major ecosystem-wide 
initiatives, such as $58 million for studies and projects in the 
California Bay-Delta, including an important new reconnaissance study 
for fish passage at Englebright and Daguerre Point Dams on the Yuba 
River; an ongoing feasibility study for the Sacramento-San Joaquin 
Delta Islands and Levees; an ongoing comprehensive feasibility study 
for the Sacramento-San Joaquin River Basins; and a new construction 
project at Hamilton City for ecosystem restoration and flood damage 
reduction.
    The budget includes $128 million for the Columbia River Fish 
Mitigation program, an ongoing effort to reduce the adverse impacts of 
a series of COE dams on migrating salmon. Funds will be used to 
construct juvenile fish bypass facilities, improve adult fish ladders 
and conduct other activities that support salmon habitat. The budget 
also provides $73 million for ongoing work under the Missouri River 
fish and wildlife recovery program to construct shallow water habitat 
and undertake other activities to recover and protect federally listed 
species, such as the pallid sturgeon.

            coe deg.INFRASTRUCTURE RECAPITALIZATION

    The administration plans to work with the Congress and stakeholders 
to explore ways to support recapitalization of aging COE 
infrastructure, modification of its operations, or de-authorization, 
consistent with modern-day water resources principles and today's and 
tomorrow's water resources priorities. Under these principles, direct 
beneficiaries would be asked to pay a significant share of the costs to 
rehabilitate, expand or replace projects, as they would for a new 
project, commensurate with the benefits they receive. Options such as 
direct financing will be considered as part of this effort, where 
appropriate.
    The aging of infrastructure affects all of our activities. For 
example, with regard to the production of hydropower, the fiscal year 
2012 budget provides $176 million to operate and maintain COE 
hydropower facilities. In order to decide how best to use the available 
funding, COE has been working under its Hydropower Modernization 
Initiative (HMI) to develop a long-term capital investment strategy. 
One significant feature of the HMI is the Asset Investment Planning 
Tool, which was designed to:
  --analyze the condition of critical components and the consequences 
        of failure;
  --determine the value of additional hydropower and its cost;
  --quantify risk exposure for capital investments; and
  --create 20-year funding scenarios to allow for timely and cost-
        effective rehabilitation or replacement of hydropower 
        facilities and their components.
    To assist the Federal Government in rehabilitating aging equipment, 
COE also is pursuing increased use of non-Federal funds.

             coe deg.HARBOR MAINTENANCE TRUST FUND

    The budget provides for use of $758 million from the Harbor 
Maintenance Trust Fund to maintain coastal channels and harbors. 
Despite an overall Civil Works reduction of 15 percent below the 
enacted fiscal year 2010 level, the amount recommended in the fiscal 
year 2012 budget for harbor maintenance and related work is essentially 
unchanged from the 2 prior years. The administration also plans to 
develop legislation to expand the authorized uses of the Trust Fund, so 
that its receipts are available to finance the Federal share of other 
efforts in support of commercial navigation through the Nation's ports. 
No decisions have been made yet on what additional costs would be 
proposed to be paid from receipts into the Harbor Maintenance Trust 
Fund. Development of proposed legislation will proceed in the coming 
months.

              coe deg.INLAND WATERWAYS TRUST FUND

    Inland waterways capital investments are funded in the budget at 
$166 million, of which $77 million is financed from the Inland 
Waterways Trust Fund. This is the total amount that is affordable in 
fiscal year 2012 with the current level of revenue coming into the 
Trust Fund. The administration will work with the Congress and 
stakeholders to revise the laws that govern the Trust Fund, to include 
increasing the revenue paid by commercial navigation users of the 
inland waterways to meet their share of the costs of activities 
financed from this trust fund.

 coe deg.AMERICA'S GREAT OUTDOORS INITIATIVE AND CIVIL WORKS 
                               RECREATION

    On April 16, 2010 President Obama signed a Presidential Memorandum 
establishing the America's Great Outdoors (AGO) Initiative to promote 
and support innovative community-level efforts to conserve outdoor 
spaces and to reconnect Americans to the outdoors. This initiative was 
celebrated at several events around the country, including a public 
``listening'' event the Secretary of the Interior and I held in August 
2010 at a Civil Works project near St. Louis, Missouri.
    COE has been actively involved with the AGO initiative, working in 
concert with its partners to leverage financial and human resources so 
the public can continue to enjoy water-based recreation opportunities 
at COE lakes. The Civil Works recreation program and activities are 
closely aligned with the goals of the initiative and include a variety 
of measures to reconnect Americans, especially young people, with the 
Nation's outdoor resources.
    COE manages 12 million acres of lands and waters supporting water-
based recreation and environmental stewardship. The Civil Works program 
is particularly well-suited to support the AGO initiative, given that 
90 percent of COE projects are within 50 miles of metropolitan areas. 
Camping, hiking, swimming, boating, and other water-oriented recreation 
opportunities attract 370 million visits a year to 422 COE projects. In 
addition, COE has active programs to conserve and protect lands and 
waters for wildlife, fisheries, endangered species and open space.

                 coe deg.PLANNING IMPROVEMENTS

    Working through the Chief of Engineers, the Army continues to 
strengthen and improve the planning expertise of COE, including greater 
support for planning Centers of Expertise, better integration of 
project purposes, greater reliability of cost estimates and schedules 
in planning and programming, and continued support for the development 
of revised water project planning Principles and Guidelines. Also, the 
Army has initiated a pilot program to identify means of enabling 
studies to reach decisions more efficiently.

               coe deg.VETERANS CURATION PROJECT

    The fiscal year 2012 budget includes $2 million to continue the 
Veterans Curation Project, which provides vocational rehabilitation and 
innovative training for wounded and disabled veterans, while achieving 
historical preservation responsibilities for archaeological collections 
administered by COE. The project supports work by veterans at curation 
laboratories located in Augusta, Georgia; St. Louis, Missouri; and 
Washington, DC.

                coe deg.LOWER-PRIORITY PROGRAMS

    Funding of $76 million is provided in the fiscal year 2012 budget 
for maintenance of navigation harbors and waterway segments that 
support low commercial use. This is a reduction of $64 million from the 
fiscal year 2011 budget. The Estuary Restoration Program is funded at 
$2 million, compared to $5 million in the fiscal year 2011 budget.
    No funding is provided for small projects in 4 of the 9 Continuing 
Authorities Programs (CAPs):
  --section 14 (emergency streambank and shoreline protection);
  --section 103 (shore protection);
  --section 107 (navigation); and
  --section 208 (snagging and clearing).
    The budget proposes to reprogram $23 million of CAP funds carried 
over from prior years from these four CAPs to finance ongoing phases of 
projects in 4 of the remaining 5 CAPs:
  --section 111 (mitigation of shoreline damages caused by navigation 
        projects);
  --section 204 (beneficial use of dredged material);
  --section 206 (aquatic ecosystem restoration); and
  --section 1135 (modification of completed projects for the benefit of 
        the environment).
    Section 205 (flood damage reduction) also is supported, and has 
sufficient carryover within it to finance the fiscal year 2012 program 
without a reprogramming.
    No funding is provided for the Aquatic Plant Control program, nor 
is specific line item funding provided for coordination activities 
associated with the National Estuary Program and the North American 
Waterfowl Management Program. Coordination activities will take place, 
as appropriate, in connection with separately funded programs and 
projects.
    Funding under the Formerly Utilized Sites Remedial Action Program 
(FUSRAP) is reduced by $21 million, from $130 million in the fiscal 
year 2011 budget to $109 million in the fiscal year 2012 budget.

        coe deg.AMERICAN RECOVERY AND REINVESTMENT ACT

    COE continues the work funded in American Recovery and Reinvestment 
Act (ARRA). The act provided $4.6 billion for the Civil Works program. 
That amount includes $2 billion for Construction; $2.075 billion for 
O&M $375 million for Mississippi River and Tributaries; $25 million 
for Investigations; $25 million for the Regulatory Program; and $100 
million for the Formerly Utilized Sites Remedial Action Program. The 
ARRA funds were allocated to more than 800 projects in 49 States, the 
District of Columbia, and Puerto Rico, and 400 of those projects have 
been completed.
    Nearly all of the $4.6 billion of these funds have been obligated, 
leaving only a small amount, as authorized, for contract supervision 
and administration, as well as known contract claims and modifications. 
As of last month, more than $3.1 billion of the total had been 
expended, primarily payments to contractors for work already completed. 
Of the more than 2,100 recipients of the COE ARRA funds, 99.8 percent 
submitted a report last quarter as required under the act and 
provisions of ARRA contracts.
    The projects funded by ARRA provide important support to the 
Nation's small businesses in their economic recovery. Of the total ARRA 
funds, small business awards account for about 51 percent of the ARRA 
funds obligated and about 72 percent of the total contract actions.
    COE achievements to date with ARRA funds include improvement of 28 
important commercial navigation harbors and channels; repair or 
improvement of dozens of hydropower projects; accelerated completion of 
site cleanup at 9 FUSRAP sites; completion of 822 periodic inspections 
of federally constructed levee systems, including both systems 
maintained by COE and those maintained by local sponsors; and 
completion of important work to restore 57 aquatic ecosystems.

                               CONCLUSION

    In summary, the President's fiscal year 2012 budget for the Army 
Civil Works program is a performance-based budget that supports water 
resources investments that will yield long-term returns for the Nation.
    Madam Chairman and members of the subcommittee, I look forward to 
working with this subcommittee in support of the President's budget. 
Thank you.

    Senator Feinstein. Thank you very much for those words.
    General Van Antwerp, would you like to make some comments?

STATEMENT OF LIEUTENANT GENERAL ROBERT L. VAN ANTWERP, 
            CHIEF OF ENGINEERS
    General Van Antwerp. Madam Chairman and distinguished 
members of the subcommittee, the budget this year funds 92 
construction projects, 55 in the flood-storm-damage reduction. 
Three are budgeted for completion. We have 16 commercial 
navigation projects in this budget and 19 aquatic ecosystem 
projects. Two of these are scheduled as new starts.
    The budget supports our continued stewardship of water-
related infrastructure. The operation and maintenance program 
for the fiscal year 2012 budget includes $2.314 billion and an 
additional $131 million under the Mississippi River and 
Tributaries program.
    COE teammates continue to respond wherever and whenever 
needed to help during major floods and other national 
emergencies. As you can imagine, we are gearing up right now. 
The budget provides $27 million for the preparation for floods, 
hurricanes, and other natural disasters, to include $4 million 
to support the levee safety initiatives in States known as 
``silver jackets.''
    I would like to just provide a quick update on preparations 
as we look forward--not really look forward to, but as we 
anticipate potential spring flood events. We are working with 
the Federal Emergency Management Agency (FEMA) and the National 
Weather Service to monitor the high probability of spring 
flooding in the north central United States, a lot of which is 
already happening out there, specifically the Red River and the 
upper Mississippi River and the Minnesota River. Based on our 
projections, our Commanders have requested the advance planning 
and advance measures funding needed to flood fight. We are out 
there on the ground right now. And I guess in three words I 
would say we are ready.
    On the international front, although not covered 
specifically by this subcommittee, I am proud to tell you a 
little bit about our work in Iraq and Afghanistan, if you will 
indulge me that. We have 1,168 COE members, largely civilians, 
right now deployed overseas. Every day they put on their battle 
armor and they work on the projects that we have asked them to 
do. They have completed more than 6,000 infrastructure and 
water-related projects. We have a lot of our Civil Works 
members that work in COE over there deployed on this military 
mission.
    Last month, Ms. Darcy and I traveled to Afghanistan with my 
counterparts from the other services and witnessed this amazing 
work and had a chance to praise them for their efforts and 
thank them.
    On the 21st and 22d of March, we traveled down to New 
Orleans. We wanted to visit all the major projects in our 
Hurricane Storm Damage Risk Reduction System and make sure that 
the system was ready to defend against the 100-year event by 
June 1 and I am proud to say and happy to say that we are 
ready. It has just been amazing what work has been done down 
there.

                           PREPARED STATEMENT

    Finally, I would like to just say that we are committed to 
staying on the leading edge of service to our Nation in these 
water-related issues, and I look forward to your questions. 
Thank you.
    [The statement follows:]
     Prepared Statement of Lieutenant General Robert L. Van Antwerp

    Chairman Feinstein and distinguished members of the subcommittee: I 
am honored to be testifying before your subcommittee today, along with 
the Assistant Secretary of the Army (Civil Works), the Honorable Jo-
Ellen Darcy, on the President's fiscal year 2012 budget for the Civil 
Works Program of the United States Army Corps of Engineers (COE).
    My statement covers the following 12 topics:
  --Summary of fiscal year 2012 program budget;
  --Direct program;
  --Investigations program;
  --Construction program;
  --Operation and maintenance program;
  --Reimbursable program;
  --Proposed legislation;
  --Planning program modernization;
  --Efficiency and effectiveness of COE operations;
  --Value of the Civil Works Program to the Nation's economy and 
        defense;
  --Research and development; and
  --National defense.

      coe deg.SUMMARY OF FISCAL YEAR 2012 PROGRAM BUDGET

    COE is fully committed to supporting the President's priorities to 
reduce the deficit, revitalize the economy and restore and protect the 
environment. The fiscal year 2012 Civil Works budget is a performance-
based budget that reflects a focus on the projects and activities that 
provide the highest net economic and environmental returns on the 
Nation's investment or address significant risks to human safety. The 
budget also proposes cancellation of the unobligated balance of funding 
in the Mississippi River and Tributaries account that was previously 
provided for construction of the Yazoo Backwater Pumps, Mississippi 
project. The reimbursable Interagency and International Services 
Program is projected to involve an additional $1.6 billion.

                    coe deg.DIRECT PROGRAM

    The budget includes $4.6 billion, including funding for the 
operation and maintenance of more than 600 flood and storm damage 
reduction projects, 143 commercial coastal navigation projects, and 51 
commercial navigation projects on the inland waterways. It also funds 
continuing construction of 90 construction projects and 2 new 
construction starts. The budget includes funds for 58 studies already 
underway and 4 new study starts. It will enable COE to process 
approximately 70,000 permit requests and to operate 75 hydropower 
plants with 350 generating units that produce about 24,000 megawatts 
per year. The budget will enable about 370 million outdoor recreational 
visits to COE projects and will provide water supply storage for about 
14 percent of the Nation's municipal water needs. The budget will 
sustain COE's preparedness to respond to natural disasters that we may 
experience. Finally, the budget also proposes to reduce Federal costs 
through a reduction in funding in lower-priority programs.

                coe deg.INVESTIGATIONS PROGRAM

    The budget for the Investigations program will enable COE to 
evaluate and design future projects that are most likely to be 
highperforming within COE three main mission areas:
  --commercial navigation;
  --flood and storm damage reduction; and
  --aquatic ecosystem restoration.
    The budget includes $104 million for these and related activities 
in the Investigations account and $1 million in the Mississippi River 
and Tributaries account. It funds 58 continuing studies (1 
reconnaissance and 57 feasibility) and 4 new studies:
  --Englebright and Daguerre Point Dams (Yuba River) Fish Passage, 
        California;
  --Cano Martin Pena, Puerto Rico;
  --the Chesapeake Bay Comprehensive Plan; and
  --the Louisiana Coastal Area Comprehensive Study.
    Funding is also included for the Water Resources Priorities Study, 
a high-priority evaluation of the Nation's vulnerability to inland and 
coastal flooding, as well as the effectiveness, efficiency, and 
accountability of existing water resource programs and strategies.

                 coe deg.CONSTRUCTION PROGRAM

    The goal of the construction program is to deliver as high a value 
as possible to the Nation from the overall available funding through 
the construction of new water resources projects and the replacement, 
rehabilitation, and expansion of existing water resources projects in 
the three main Civil Works missions (flood and storm damage reduction, 
aquatic ecosystem restoration, and commercial navigation) and related 
projects (principally hydropower). The fiscal year 2012 budget includes 
$1.48 billion in the Construction account and $78 million in the 
Mississippi River and Tributaries account to further this objective. 
Consistent with this goal, the budget also gives priority to projects 
that address a significant risk to human safety.
    The budget funds 92 construction projects, including:
  --55 Flood and storm damage reduction projects (3 budgeted for 
        completion);
  --16 Commercial navigation projects (including 5 continuing 
        mitigation items and 4 dredged material placement areas);
  --19 Aquatic ecosystem restoration projects (including 3 projects to 
        meet biological opinions); and
  --mitigation associated with 2 Hydropower projects.
    Two of these construction projects are new starts. In the 
construction program, the aquatic ecosystem restoration mission also 
includes significant environmental mitigation work in the Columbia 
River Basin and the Missouri River Basin needed to support the 
continued operation of COE multi-purpose projects, which improves 
habitat and migration pathways for endangered and threatened species.
    Performance measures, which COE uses to establish priorities among 
projects, include the benefit-to-cost ratios for projects with economic 
outputs and the most cost-effective restorations of significant aquatic 
ecosystems. The selection process also gives priority to dam safety 
assurance, seepage control, static instability correction work, and to 
projects that address a significant risk to human safety. These 
performance measures maximize benefits to the Nation from the Civil 
Works construction program by focusing on the projects that will 
provide the best net returns for each dollar invested.

           coe deg.OPERATION AND MAINTENANCE PROGRAM

    The facilities owned and operated by, or on behalf of, COE of 
Engineers are aging. As stewards of this infrastructure, we are working 
to ensure that its key features continue to provide an appropriate 
level of service to the Nation. Sustaining such service poses a 
technical challenge in some cases, and proper maintenance is becoming 
more expensive at many of our projects as infrastructure ages.
    The Operation and Maintenance (O&M) program for the fiscal year 
2012 budget includes $2.314 billion and an additional $131 million 
under the Mississippi River and Tributaries program with a focus on the 
maintenance of key commercial navigation, flood and storm damage 
reduction, hydropower, and other facilities. Specifically, the O&M 
program supports completed works owned or operated by the Corps of 
Engineers, including administrative buildings and laboratories. Work to 
be accomplished includes:
  --operation of the locks and dams of the inland waterways;
  --dredging of inland and coastal Federal commercial navigation 
        channels;
  --operating multiple purpose dams and reservoirs for flood damage 
        reduction, aquatic ecosystem restoration, hydropower, 
        recreation, and other related purposes;
  --maintenance and repair of these facilities;
  --monitoring of completed storm damage reduction projects along our 
        coasts; and
  --general management of facilities and the lands associated with 
        these purposes.

                 coe deg.REIMBURSABLE PROGRAM

    Through the Interagency and Intergovernmental Services Program, we 
help non-DOD Federal agencies, State, local and tribal governments, and 
other countries with timely, cost-effective implementation of their 
programs. Rather than develop their own internal workforce to oversee 
design and construction of projects, these agencies can turn to COE , 
which has these capabilities. Such intergovernmental cooperation is 
effective for agencies and the taxpayer by using the skills and talents 
that we bring to our Civil Works and Military Program missions. The 
work is principally technical oversight and management of engineering, 
environmental, and construction contracts performed by private sector 
firms, and is totally financed by the agencies we serve. We only accept 
agency requests that we can execute without impacting our Civil Works 
or Military Programs missions, are consistent with our core technical 
expertise, and are in the national interest.
    Currently, we provide reimbursable support for about 70 other 
Federal agencies and several State and local governments. Total 
reimbursement for such work in fiscal year 2012 is projected to be $1.6 
billion, reflecting completion of most ARRA work and a general 
reduction in budget capability for most of our other agency customers. 
The exact amount will depend on requests from the agencies.

                 coe deg.PROPOSED LEGISLATION

    The budget includes several legislative proposals that will improve 
operations or enable execution of important national programs. The 
budget proposes to extend the authority to implement measures to 
prevent the migration of invasive aquatic species into the Great Lakes, 
to transfer funds between accounts to enable completion of the New 
Orleans perimeter protection by June 2017, to purchase the property 
that houses the Cold Regions Research Engineering Laboratory in 
Hanover, New Hampshire, and to make a minor modification to existing 
law that will enable us to serve in an official capacity in meetings of 
the Permanent International Association of Navigation Congresses. As 
included in the testimony of Assistant Secretary of the Army (Civil 
Works) Jo-Ellen Darcy, the budget also discusses two other important 
legislative initiatives, concerning the way in which Federal navigation 
activities are funded.

            coe deg.PLANNING PROGRAM MODERNIZATION

    COE will continue to implement actions to improve its Civil Works 
Planning Program performance through a planning modernization effort. 
This effort focuses on how best to organize, manage, operate, and 
oversee the planning program to more effectively address 21st century 
water resources challenges, including:
  --improved project delivery that yields smarter outcomes;
  --improved technical capability of our planners;
  --enhanced collaboration with Federal, State, local, and 
        nongovernmental partners;
  --evaluating and enhancing Corps Planning Centers of Expertise 
        production capability and staffing; and
  --strengthening the objectivity and accountability of our planning 
        efforts.
    Our improved planning performance will include:
  --updated planning guidance and policy;
  --streamlined, adaptable planning processes to improve effectiveness, 
        efficiency, accuracy, and responsiveness; and
  --enhanced technical capabilities.
    In fiscal year 2011, COE launched a 2-year National Planning Pilot 
Program to test the concepts of this approach within our current policy 
and to develop and refine methodologies and processes for planning 
studies across all business lines in a manner that is sustainable and 
replicable and that will inform future Civil Works guidance. We expect 
to conduct approximately 7 to 9 pilot studies over the course of the 
National Planning Pilot Program.

coe deg.EFFICIENCY AND EFFECTIVENESS OF THE CORPS OF ENGINEERS 
                               OPERATIONS

    COE always strives to continually improve the efficiency and 
effectiveness of its investigations, construction, and operation and 
maintenance programs. In fiscal year 2012, COE will further expand the 
implementation of a modern asset management program; increase its focus 
on the most important maintenance work; implement an energy 
sustainability program; pursue major efficiencies in the acquisition 
and operations of its information technology assets; and complete the 
ongoing reorganization of its acquisition workforce.

                  coe deg.EMERGENCY RESPONSE

    From across the Nation, the people who work for COE continue to 
respond whenever needed to the call to help during major floods and 
other national emergencies. The critical work they are doing reduces 
the risk of damage to people and communities. The budget provides $27 
million for preparedness for floods, hurricanes, and other natural 
disasters, including $4 million in support of the levee safety 
initiative for COE participation in the expansion of interagency teams 
known as Silver Jackets, to include every State, and provide unified 
Federal assistance in implementing flood and storm damage reduction 
solutions.

               coe deg.RESEARCH AND DEVELOPMENT

    Civil Works Program research and development provides the Nation 
with innovative engineering products, some of which can have 
applications in both civil and military infrastructure spheres. By 
creating products that improve the efficiency and competitiveness of 
the Nation's engineering and construction industry and by providing 
more cost-effective ways to operate and maintain infrastructure, Civil 
Works program research and development contributes to the national 
economy.

                   coe deg.NATIONAL DEFENSE

    Internationally, COE continues to support the mission to help Iraq 
and Afghanistan build foundations for democracy, freedom, and 
prosperity.
    We are proud to serve this great Nation and our fellow citizens, 
and we are proud of the work COE does to support America's foreign 
policy, particularly with our ongoing missions in Afghanistan and Iraq. 
Men and women from across the COE--all volunteers and many of whom have 
served on multiple deployments--continue to provide critical support to 
our military missions there and humanitarian support to the citizens of 
those nations. Currently, 1,168 COE employees (civilian and military) 
are deployed in Iraq and Afghanistan, where they have completed a total 
of more than 6,000 infrastructure and water resources projects.
    Ms. Darcy and I traveled to Afghanistan last month. As with every 
opportunity that I've had to travel to that theater, I continue to be 
amazed--but not surprised--by the progress being made. It was truly a 
privilege to visit with the outstanding COE men and women who are 
making this happen, and to see their dedication and commitment.
    In Afghanistan, the COE is spearheading a comprehensive 
infrastructure program for the Afghan national army, and is also aiding 
in critical public infrastructure projects.

                               CONCLUSION

    COE is committed to staying at the leading edge of service to the 
Nation. We are committed to change that ensures an open, transparent, 
and performance-based Civil Works Program.
    Thank you, Chairman Feinstein and members of the subcommittee. This 
concludes my statement.

    Senator Feinstein. Thank you very much, General.
    Secretary Castle, would you like to begin?

                       DEPARTMENT OF THE INTERIOR

                         Bureau of Reclamation

STATEMENT OF HON. ANNE CASTLE, ASSISTANT SECRETARY FOR 
            WATER AND SCIENCE
ACCOMPANIED BY REED MURRAY, PROGRAM DIRECTOR, CENTRAL UTAH PROJECT 
            COMPLETION ACT OFFICE
    Ms. Castle. Yes. Thank you, Madam Chair, Senator Alexander, 
and members of the subcommittee. Thank you for inviting me here 
to discuss the President's 2012 budget request with you today. 
You have noted Commissioner Connor's presence. With me also is 
Reed Murray who is the Director of the Central Utah Project 
Completion Act (CUPCA) should you have any specific questions 
about that program.
    Interior's mission is essential to our American way of 
life. We protect our natural resources and our cultural 
heritage. We honor our Nation's trust responsibilities to 
American Indians and Alaska Natives. We supply water to lands 
and people throughout the West. We provide energy to power our 
future. Our Interior Department people and programs touch 
virtually every single American.
    The Interior 2012 budget funds our primary mission areas, 
and we have done that by eliminating and reducing lower-
priority programs, by streamlining and gaining efficiencies, 
and by deferring some projects.
    The 2012 combined budget request for BOR and the CUPCA 
program is $1.1 billion. As you said, Madam Chair, that is a 
$78.3 million reduction, 7 percent, from the 2010 enacted 
level.
    One of the highest priorities that we have in the 
Department of the Interior is to address water challenges by 
providing Federal leadership on the path to a sustainable water 
future. We are doing that through our WaterSMART initiative, 
and we are trying to address the 21st century pressures on our 
Nation's water supplies. The 2012 budget request by Interior 
for the WaterSMART initiative is $70 million. That is 
distributed between BOR and the U.S. Geological Survey (USGS).
    Of that request, $59 million is for BOR programs. That 
includes three ongoing BOR programs, the title 16 Water 
Recycling and Reuse Grant Program, the Basin Studies Program, 
and the WaterSMART cost share grant funding.
    Two additional programs are being added to the WaterSMART 
initiative this year. One already existed within BOR. That is 
the Water Conservation Field Services program. The other is the 
Cooperative Watershed Management program which is a new program 
authorized under the Secure Water Act, and we have seed money 
in the BOR budget for that in 2012.
    USGS has requested funding to undertake a multiyear 
nationwide water availability and use assessment that was also 
authorized by the Secure Water Act, and that is what its 
funding is in the WaterSMART program.
    I want to briefly highlight just a few of BOR's other 
significant efforts. BOR just released its hydropower resource 
assessment that takes a look at the potential to add hydropower 
capacity to existing BOR facilities. The next phase of that 
assessment will look at adding hydropower capacity to canals 
and conduits. So we are trying to assess the potential for 
additional renewable energy at existing facilities.
    We are currently in a dialogue with Mexico on the 
management of the Colorado River, and we have ongoing efforts 
to improve our water operations on the Colorado River--from 
looking at renewable energy projects in the headwaters all the 
way down to desalination efforts near the Mexican border.
    We are actively pursuing solutions to the ongoing water 
challenges in the California Bay-Delta. Our efforts there are 
focused on co-leading with the Council on Environmental Quality 
(CEQ) an interagency effort to implement the December 2009 
Interim Federal Action Plan.
    Our 2012 budget includes funding for the initial 
implementation of four Indian water rights settlements that 
were authorized in the Claims Resolution Act at the end of last 
year. And in addition to those four settlements, BOR's budget 
includes funding for the Navajo-Gallup Water Supply Project, an 
ongoing project.
    With respect to CUPCA, the 2012 budget request is for $33 
million. That includes $28.5 million to design, construct and 
provide land acquisition for the Utah lake system, which is the 
last remaining component of the Central Utah Project. That 
amount includes full funding for the construction of the Provo 
River Canal Enclosure Project, which will provide 8,000 acre-
feet of saved water to benefit endangered species and 30,000 
acre-feet, when completed, to municipalities in Salt Lake and 
Utah Counties in Utah.
    This budget was constructed, as has been said, in the 
context of very difficult economic times. We took a hard look 
at our existing programs. We made some very, very tough calls, 
and we made some reductions in order to shoulder our share of 
responsibility to reduce the deficit. We think we have done 
that in a way that adequately protects water and power 
deliveries, protects the ecosystems that are affected by those 
delivery systems so that we can ensure reliability of supplies 
in the future, and makes appropriate investments in our 
infrastructure.

                           PREPARED STATEMENT

    I look forward to your questions. I appreciate and thank 
you for your support, and this subcommittee's support of the 
missions within the Department of the Interior. I look forward 
to discussing this budget with you.
    [The statement follows:]

                   Prepared Statement of Anne Castle

    Madam Chair, Senator Alexander, and members of this subcommittee, I 
am pleased to appear before you today to discuss the President's fiscal 
year 2012 budget for the Department of the Interior. I would also like 
to thank the members of this subcommittee for your ongoing support for 
our initiatives over the last 2 years.
    The 2012 budget builds on that strong foundation with $12.2 billion 
requested for the Department of the Interior. The budget demonstrates 
that we can responsibly cut the deficit, while investing to win the 
future and sustain the national recovery. Our budget promotes the 
actions and programs that America told us are important in 50 listening 
sessions across the country. In response, we developed a new 21st 
century conservation vision--America's Great Outdoors. The budget 
continues to advance efforts that you have facilitated in renewable 
energy and sustainable water conservation, cooperative landscape 
conservation, youth in the outdoors, and reforms in our conventional 
energy programs.
    I will also discuss the President's fiscal year 2012 budget request 
for implementation of the Central Utah Project Completion Act, and I 
thank the subcommittee for your continued support of the Central Utah 
Project Completion Act Program as well.

                              INTRODUCTION

    Interior's mission--to protect America's natural resources and 
cultural heritage and honor the Nation's trust responsibilities to 
American Indians and Alaska Natives--is profound. Interior's people and 
programs impact all Americans.
    The Department is the steward of 20 percent of the Nation's lands 
including national parks, national wildlife refuges, and the public 
lands. Interior manages public lands and the Outer Continental Shelf, 
providing access for renewable and conventional energy development and 
overseeing the protection and restoration of surface-mined lands. 
Through the Bureau of Reclamation (BOR), Interior is the largest 
supplier and manager of water in the 17 Western States and provides 
hydropower resources used to power much of the country. The Department 
supports cutting edge research in the earth sciences--geology, 
hydrology, and biology--to inform resource management decisions at 
Interior and improve scientific understanding worldwide. The Department 
of the Interior also fulfills the Nation's unique trust 
responsibilities to American Indians and Alaska Natives, and provides 
financial and technical assistance for the insular areas.
    The Department of the Interior makes significant contributions to 
the Nation's economy. It supports more than 1.3 million jobs and more 
than $370 billion in economic activity each year. Parks, refuges, and 
monuments generate more than $24 billion in economic activity from 
recreation and tourism. Conventional and renewable energy produced on 
Interior lands and waters results in about $295 billion in economic 
benefits and the water managed by Interior supports more than $25 
billion in agriculture. The American outdoor industry estimates 6.5 
million jobs are created every year from outdoor activities.

                 bor deg.2010 ACCOMPLISHMENTS

    At the start of the administration, Interior set on a course to 
create a comprehensive strategy to advance a new energy frontier; 
tackle the impacts of a changing landscape; improve the sustainable use 
of water; engage youth in the outdoors; and improve the safety of 
Indian communities. These priority goals integrate the strengths of the 
Department's diverse bureaus and offices to address key challenges of 
importance to the American public. Interior has been making progress in 
these areas, including:
    Approving 12 renewable energy projects on public lands that when 
built, will produce almost 4,000 megawatts of energy, enough energy to 
power close to 1 million American homes, and create thousands of 
construction and operational jobs.
    Designating more than 5,000 miles of transmission corridors on 
public lands to facilitate siting and permitting of transmission lines 
and processing more than 30 applications for major transmission 
corridor rights-of-way.
    Establishing 3 of 8 planned regional Climate Science Centers and 9 
of 21 Landscape Conservation Cooperatives.
    Issuing grants to water districts and other water delivery 
authorities resulting in the conservation of 150,000 acre-feet of 
water.
    Increasing the number of youth employed in conservation through 
Interior or its partners by 45 percent more than 2009 levels.
    Reducing overall crime in four Indian communities as a result of a 
concerted effort to increase law enforcement officers, conduct training 
in community policing techniques, and engage the communities in law 
enforcement efforts.
    The Department advanced key priorities and strategic goals that 
will improve the conservation and management of natural and cultural 
resources into the future.
    Interior, along with the Department of Agriculture, the 
Environmental Protection Agency, and the Council on Environmental 
Quality, participated in the White House Conference on America's Great 
Outdoors and held 50 public listening sessions across the Country that 
have helped shape a conservation vision and strategy for the 21st 
century. We have released a report, America's Great Outdoors: A Promise 
to Future Generations that lays out a partnership agenda for 21st 
century conservation and recreation.
    In the spirit of America's Great Outdoors, we welcomed new national 
wildlife refuges in Kansas and Colorado and proposed a new conservation 
area in Florida at the headwaters to the Everglades. These refuges mark 
a new era of conservation for the Department, one that is community-
driven, science-based, and takes into account entire ecosystems and 
working landscapes.
    The Department worked with others to develop an action plan to help 
address water supply and environmental challenges in the California 
Bay-Delta area, invested more than $500 million in major water projects 
over the past 2 years, and moved forward on long-standing water 
availability issues in the Colorado River Basin.
    In December, the Secretary issued a recommendation to the Congress 
to undertake an additional 5.5 miles of bridging on the Tamiami Trail 
in the Everglades above and beyond the 1-mile bridge now under 
construction. When combined with other planned work in the Everglades 
Agricultural Area and water conservation areas, this project should 
restore 100 percent of historic water quantity and flow to Everglades 
National Park.
    With the help of the Congress, we brought about resolution of the 
Cobell v. Salazar settlement and resolved four Indian water rights 
issues through enactment of the Claims Resolution Act of 2010. We also 
completed negotiation of a new Compact of Free Association with the 
island of Palau which awaits congressional approval.
    In December of last year, the President hosted the second White 
House Tribal Nations Conference bringing together tribal leaders from 
across the United States; we are improving the Nation-to-nation 
relationship with 565 tribes.

                 bor deg.FISCAL RESPONSIBILITY

    Interior's 2012 budget must be viewed in the context of the 
difficult fiscal times facing the Nation and the President's freeze on 
discretionary funding. The 2012 budget reflects many difficult budget 
choices, cutting worthy programs and advancing efforts to shrink 
Federal spending. The budget contains reductions totaling $1.1 billion 
or 8.9 percent of the 2010 enacted level. Staffing reductions are 
anticipated in some program areas, which will be achieved through 
attrition, outplacement, and buy-outs to minimize the need to conduct 
reductions in force to the greatest extent possible. These reductions 
are a necessary component of maintaining overall fiscal restraint while 
allowing us to invest additional resources in core agency priorities.
    This budget is responsible. Interior's $12.2 billion budget funds 
important investments by eliminating and reducing lower-priority 
programs, deferring projects, reducing redundancy, streamlining 
management, and capturing administrative and efficiency savings. It 
maintains funding levels for core functions that are vital to uphold 
stewardship responsibilities and sustain key initiatives. The 2012 
request includes $11.2 billion for programs funded by the Interior, 
environment, and related agencies appropriation. The 2012 request for 
BOR and the Central Utah Project Completion Act, funded in the Energy 
and Water Development Appropriations Act, is $1.1 billion in current 
appropriations, $78.3 million or 7 percent below the 2010 enacted 
level.

                bor deg.INVESTING IN THE FUTURE

    America's Great Outdoors.--Last year, the administration initiated 
a national dialogue at the White House Conference on America's Great 
Outdoors. In 50 listening sessions held across the Country, the public 
communicated their conservation and recreation priorities, and the 
result is a report to the President, ``America's Great Outdoors: A 
Promise to Future Generations''. The report outlines how the Federal 
Government can support a renewed and refreshed conservation vision by 
working in collaboration with communities, farmers and ranchers, 
businesses, conservationists, youth, and others who are working to 
protect the places that matter to them and by engaging people across 
the country in conservation and recreation.
    The 2012 America's Great Outdoors initiative focuses on investments 
that will lead to healthy lands, waters and resources while stimulating 
the economy--goals that are complementary. Through strategic 
partnerships, Interior will support and protect historic uses of lands, 
restore lands and resources, protect and interpret historic and 
cultural resources, and expand outdoor recreation opportunities. All of 
these activities have significant economic benefits in rural and urban 
communities.
    Youth.--Furthering the youth and conservation goals of the 
America's Great Outdoors initiative, the 2012 budget proposes to 
continue engaging youth by employing and educating young people from 
all backgrounds.
    Interior is uniquely qualified to engage and educate young people 
in the outdoors and has programs that establish connections for youth 
ages 18 to 25 with natural and cultural resource conservation. These 
programs help address unemployment in young adults and address health 
issues by encouraging exercise and outdoor activities. For example, 
Interior is taking part in the First Lady's Let's Move initiative to 
combat the problem of childhood obesity. Interior has long-standing 
partnerships with organizations such as the 4-H, the Boy Scouts, the 
Girl Scouts, the Youth Conservation Corps, and the Student Conservation 
Association. These programs leverage Federal investments to put young 
people to work and build a conservation ethic.
    Cooperative Landscape Conservation.--Interior's 2012 budget 
realigns programs and funding to better equip land and resource 
managers with the tools they need to effectively conserve resources in 
a rapidly changing environment. Significant changes in water 
availability, longer and more intense fire seasons, invasive species 
and disease outbreaks are creating challenges for resource managers and 
impacting the sustainability of resources on public lands. These 
changes result in bark beetle infestations, deteriorated range 
conditions, and water shortages that negatively impact grazing, 
forestry, farming, as well as the status of wildlife and the condition 
of their habitats. Many of these problems are caused by or exacerbated 
by climate change.
    Interior's 2012 budget includes $175.0 million for cooperative 
landscape conservation, an increase of $43.8 million. The budget funds 
the completion of the Climate Science Centers and Landscape 
Conservation Cooperatives, the organizing framework for the 
Department's efforts to work collaboratively with others to understand 
and manage these changes. These efforts will allow the Department to 
meet its priority goal to identify resources vulnerable to climate 
change and implement coordinated adaptation response actions for 50 
percent of the Nation by the end of 2012.
    Water Challenges.--Interior is working to address the 21st century 
pressures on the Nation's water supplies. Population growth, aging 
water infrastructure, changing climate, rising energy demands, impaired 
water quality and environmental needs are among the challenges. Water 
shortage and water use conflicts have become more commonplace in many 
areas of the United States, even in normal water years. As competition 
for water resources grows, the need for information and tools to aid 
water resource managers also grows. Water issues and challenges are 
increasing across the Nation, but particularly in the West and 
Southeast due to more prolonged droughts than we have experienced 
historically. Traditional water management approaches no longer meet 
today's needs.
    BOR proposes to fund the rebased WaterSMART at $58.9 million, $11 
million below 2011 levels. The three ongoing WaterSMART programs 
include:
  --the WaterSMART Grant program funded at $18.5 million;
  --Basin Studies funded at $6 million; and
  --the title XVI Water Reclamation and Reuse program funded at $29 
        million.
    The rebasing adds the existing Water Conservation Field Services 
program, funded at $5.1 million, and participation by BOR in the 
Cooperative Watershed Management program, funded at $250,000. 
WaterSMART is a joint effort with USGS. USGS will use $10.9 million, an 
increase of $9 million, for a multi-year, nationwide water availability 
and use assessment program.
    Other significant programs and highlights specific to BORinclude:
    In 2010, the Secretary issued a Secretarial Order establishing the 
WaterSMART program which embodies a new water sustainability strategy. 
WaterSMART coordinates Interior's water sustainability efforts, creates 
a clearinghouse for water conservation best practices and implements a 
department-wide water footprint reduction program to reduce consumption 
of potable water by 26 percent by 2020.
    We are in dialogue with Mexico on the management of the Colorado 
River. We have ongoing efforts to improve our management of resources 
on the Colorado River, from renewable hydropower development near the 
headwaters to a pilot program of desalination near the Mexican border.
    We are actively pursuing workable solutions to regional issues such 
as in the California Bay-Delta. The Bay-Delta is a source of drinking 
water for 25 million Californians and sustains about $400 billion in 
annual economic activity, including a $28 billion agricultural industry 
and up until recently supported a thriving commercial and recreational 
fishing industry. Our efforts in the Bay-Delta are focused on co-
leading an inter-agency effort with the Council on Environmental 
Quality (CEQ) to implement the December 2009 Interim Federal Action 
Plan for the California Bay-Delta Conservation Plan. In coordination 
with five other Federal agencies, we are leveraging our activities to 
address California water issues, promote water efficiency and 
conservation, expand voluntary water transfers in the Central Valley, 
fund drought relief projects, and make investments in water 
infrastructure. Over the past 2 years, we have invested more than $500 
million in water projects in California. We have also, in close 
coordination with NOAA and the State of California, worked on the 
California Bay-Delta Conservation Plan, a long-term plan aimed at 
restoring both reliable water supplies and a healthy Bay-Delta 
ecosystem.
    On March 22 we announced an update to the Water Supply Allocation 
for Central Valley Project (CVP) water users for 2011. This updated 
allocation reflects improved precipitation and snowpack in the Sierra 
Nevada Mountains in the last month. We are pleased to report that the 
current allocation for most CVP contractors is 100 percent of their 
contract supply. Agricultural water service contractors South-of-Delta 
allocations have been increased from 50 percent to 65 percent and 
municipal and industrial contracts from 75 percent to 90 percent. These 
allocations represent good news given recent years, but many challenges 
remain. We will continue to work with our Federal, State, and local 
partners to improve water supply reliability while addressing 
significant ecological issues. BOR is continuing to update the forecast 
to provide the most current information to its stakeholders.

                      bor deg.HYDROPOWER

    Hydropower is a very clean and efficient way to produce energy and 
is a renewable resource. Each kilowatt-hour of hydroelectricity is 
produced at an efficiency of more than twice that of any other energy 
source. Further, hydropower is very flexible and reliable when compared 
to other forms of generation. BOR has nearly 500 dams and 10,000 miles 
of canals and owns 58 hydropower plants, 53 of which are operated and 
maintained by BOR. On an annual basis, these plants produce an average 
of 40 million megawatt (MW) hours of electricity, enough to meet the 
entire electricity needs of more than 9 million people on average.
    BOR and the Federal Energy Regulatory Commission (FERC) have an 
existing MOU, signed in 1992, that addresses the establishment of 
processes for early resolution of issues related to the timely 
development of non-Federal hydroelectric power at BOR facilities. BOR 
and FERC recently met to discuss how to improve the timeliness of the 
processes developed in that MOU and resolution of authority issues.
    BOR is assessing the potential for developing low-head 
hydroelectric generating capacity on federally owned canals and 
conduits.
    Overall, the Department shares the subcommittee's view that 
interagency coordination can leverage Federal and private sector 
investment in additional hydropower development. This consideration was 
foremost in the Department's signing a Memorandum of Understanding with 
the Department of Energy and COE on March 24, 2010 to increase 
communication between Federal agencies and strengthen the long-term 
relationship among them to prioritize the generation and development of 
sustainable hydropower. This administration is committed to increasing 
the generation of environmentally sustainable, affordable hydropower 
for our national electricity supplies in as efficient a manner as 
possible.
    Indian Land and Water Settlements.--Interior's 2012 budget includes 
$84.3 million in BOR and Bureau of Indian Affairs (BIA) to implement 
land and water settlements.
    BOR's budget includes $51.5 million for the initial implementation 
of four settlements authorized in the Claims Resolution Act of 2010. 
The legislation included water settlements for the Taos Pueblo of New 
Mexico and Pueblos of New Mexico named in the Aamodt case, the Crow 
Tribe of Montana, and the White Mountain Apache Tribe of Arizona. BOR's 
contribution to the Navajo-San Juan settlement is also included in the 
account.
    The Claims Resolution Act of 2010 establishes trust funds for 
tribes to manage water systems and settlement funds to develop 
infrastructure. The primary responsibility for constructing these water 
systems was given to BOR, while BIA is responsible for the majority of 
the trust funds, which includes $207.2 million in mandatory funding in 
2011.
    These settlements will deliver clean water to the Taos Pueblo and 
the Pueblos of Nambe, Pojoaque, San Ildefonso, and Tesuque in New 
Mexico, the Crow Tribe of Montana, and the White Mountain Apache Tribe 
of Arizona. In addition to funding for the initial implementation of 
these four settlements, BOR's budget includes $24.8 million for the 
Navajo-Gallup Water Supply project. In the 2012 budget, BORis 
establishing an Indian Water Rights Settlements account to assure 
continuity in the construction of the authorized projects and to 
highlight and enhance transparency. Both BOR and BIA are working 
cooperatively to implement the settlements.

          bor deg.CENTRAL UTAH PROJECT COMPLETION ACT

    I am pleased to provide the following information about the 
President's fiscal year 2012 budget request for implementation of 
Central Utah Project Completion Act (CUPCA).
    CUPCA, titles II-VI of Public Law 102-575, provides for completion 
of the Central Utah Project (CUP) by the Central Utah Water Conservancy 
District. The act also authorizes funding for fish, wildlife, and 
recreation mitigation and conservation; establishes an account in the 
Treasury for deposit of these funds and other contributions; 
establishes the Utah Reclamation Mitigation and Conservation Commission 
to coordinate mitigation and conservation activities; and provides for 
the Ute Indian Rights Settlement.
    The 2012 request for the Central Utah Project Completion Account 
provides $33 million for use by the District, the Mitigation 
Commission, and the Department to implement titles II-IV of the act, 
which is $9 million less than the 2010 enacted level. The decrease in 
funding for the 2012 budget is due in part to accelerated funding 
provided in 2009 through the American Recovery and Reinvestment Act and 
in part to the administration's effort to reduce the deficit.
    The request for the District includes $28.5 million to fund the 
designs, specifications, land acquisition, and construction of the Utah 
Lake System ($18.5 million). This includes full funding ($10 million) 
for construction of the Provo River Canal Enclosure Project, which when 
completed will provide 8,000 acre-feet of conserved water for 
endangered fish and convey 30,000 acre-feet of CUP water.
    The request includes $2 million for the Mitigation Commission to 
implement the fish, wildlife, and recreation mitigation and 
conservation projects authorized in title III ($1.8 million) and to 
complete mitigation measures committed to in pre-1992 BOR planning 
documents ($200,000), all of which are necessary to allow CUP 
operations.
    Finally, the request includes $2.5 million for the program office 
for endangered species recovery and operation and maintenance costs 
associated with instream flows and fish hatchery facilities ($954,000) 
and for program administration ($1.6 million).

                               CONCLUSION

    Thank you for the opportunity to testify on behalf of the 
President's fiscal year 2012 budget request for the Department of the 
Interior. I want to reiterate my appreciation for the long-standing 
support of this subcommittee. This budget has fiscal discipline and 
restraint, but it also includes forward looking investments. We have a 
tremendous opportunity to improve the future for all generations with 
wise investments in healthy lands, clean waters and expanded energy 
options.
    I look forward to working with you to implement this budget. This 
concludes my overview of the fiscal year 2012 budget request for the 
Department of the Interior. I am happy to answer any questions that you 
may have.

    Senator Feinstein. Thank you very, very much.
    General, I would like to begin with the Harbor Maintenance 
Trust Fund if I might. It is my understanding that this fund 
has a significant surplus and that the budget request states 
that the administration will be making a proposal concerning 
the fund. As I understand it, this proposal will allow other 
agencies that are conducting port-related activities to charge 
those activities to the trust fund. Is that correct? Could you 
explain this proposal?
    General Van Antwerp. Senator, I will take a stab at that 
and then turn to my policy partner here to address the other 
part.
    First of all, you are absolutely correct that there is a 
large amount in the fund, probably estimated at around $6 
billion.
    Senator Feinstein. Excuse me.
    General Van Antwerp. Yes, ma'am.
    Senator Feinstein. I left out Commissioner Connor, and it 
was truly an oversight. Why do you not finish with that, if it 
is agreeable? Then, Commissioner Connor, I really apologize.
    General Van Antwerp. We were smiling at each other. I 
thought you let him off the hook. We want to hear from him. I 
will just conclude this one part about the Harbor Maintenance 
Trust Fund.
    Generally in a given year, we get about $1.4 billion in 
receipts, and we have budgeted this year along the lines of 
$750 million from the trust fund.
    And I will let Ms. Darcy take the policy part of this, if 
that is okay.
    Senator Feinstein. Okay, fine.
    Ms. Darcy. Would you like me to finish now, Senator?
    Senator Feinstein. Well, where I am going is whether or not 
this rapidly depletes the trust fund.
    Ms. Darcy. Well, the trust fund, as the General said, gets 
about $1.4 billion annually; those funds currently are in the 
Treasury even though all of the funds that come in must be 
appropriated. And for COE, we get about $783 million 
appropriated from that annual revenue stream in our annual 
appropriations. So the balance is in the Treasury and the rest 
of its use is determined by the administration and by the 
Congress.
    Senator Feinstein. It is my understanding that the budget 
proposal does not provide for full authorized widths and depths 
to be maintained at any harbor handled by COE. Maybe you would 
like to come back to this, but my concern is that you will eat 
up the trust fund with other activities. The dredging gets done 
partially and we have some real impediment to trade and 
commerce in our country. So we will come back to that.
    Commissioner Connor.

STATEMENT OF HON. MICHAEL L. CONNOR, COMMISSIONER
    Mr. Connor. Thank you, Madam Chair. I took no offense. If I 
have learned nothing else in this job, it is sometimes the less 
said the better.
    So I thank you for your kind words and I thank you and the 
members of the subcommittee for your support of BOR, and I 
appreciate the opportunity to discuss the President's 2012 
request.
    Overall, BOR's budget reflects a comprehensive set of 
actions and initiatives that support BOR's mission. The budget 
continues to emphasize working smarter to address the water 
needs of a growing population. Certainty and sustainability are 
primary goals with respect to the use of water resources that 
require BOR to take action on many fronts, and our budget 
proposal was developed with that principle in mind.
    I should note that our efforts to work smarter include an 
array of partnerships with COE, from the Joint Dam Safety and 
Flood Protection Project at Folsom Dam to our sustainable 
hydropower initiative. In these tight budget times, combining 
our resources with those of COE will help bring value to the 
American taxpayer.
    The fiscal year 2012 budget request for BOR focuses on six 
priorities which I want to touch briefly on in my remaining 
time, and I will avoid those areas already discussed.
    Number 1, infrastructure. Overall, our budget continues to 
support the need to maintain infrastructure in a safe operating 
condition while addressing the myriad of challenges facing 
water users in the West. Approximately 51 percent of our water 
and related resources budget, or $407 million, is dedicated to 
operation, maintenance, and rehabilitation activity. These 
activities include the dam safety program, site security 
program, and RAX, which is shorthand for replacements, 
additions, and extraordinary maintenance.
    As already noted, a second priority is the WaterSMART 
program. A specific aspect that I want to highlight is that we 
have established a priority goal for approving and funding 
actions to increase the available water supply for 
agricultural, municipal, industrial, and environmental uses in 
the Western United States by 490,000 acre-feet by the end of 
2012. WaterSMART concentrates on expanding and stretching 
limited water supplies in the West to reduce conflict, 
facilitate solutions to complex water issues, and meet the 
needs of expanding municipalities, the environment, and 
agriculture. Conservation and efficient management are central 
to the creative solutions needed in the arid West.
    Ecosystem restoration is the third priority area. In order 
to meet BOR's mission goals of sustainably producing power and 
delivering water, we must continue to focus on the protection 
and restoration of the aquatic and riparian ecosystems affected 
by our operations. Ecosystem restoration involves a large 
number of activities, including our Endangered Species Recovery 
programs.
    Twenty to 25 percent of BOR's 2012 budget is allocated to 
activities in support of ecosystem restoration. This amount 
includes the request for operating, managing, and improving 
California's Central Valley Project, or CVP. CVP-related 
funding will support completion of the Red Bluff pumping plant 
and fish screen project on the Sacramento River, the Trinity 
River, and the San Joaquin River restoration programs, and 
other actions to protect and enhance California's Bay-Delta 
region.
    Our budget request also supports ongoing implementation of 
the Lower Colorado River Multi-species Program, the Platte 
River Endangered Species Recovery Program, the Upper Colorado 
and San Juan River Endangered Fish Programs.
    In addition, funding requested for the Columbia and Snake 
River Salmon Recovery Program will implement required 
biological opinion actions associated with the Federal Columbia 
River power system.
    Finally, funding is also sought for the Klamath, Middle Rio 
Grande, and Yakima projects to support extensive initiatives to 
address the competing demands in those basins.
    Cooperative landscape conservation and renewable energy 
production, a fourth area of focus, are departmental 
initiatives in which BORis actively engaged. As a threshold 
matter, we are developing and implementing approaches to 
understand and effectively adapt to the risks and impacts of 
climate change on western water. As you know, Madam Chair, 
better than anybody, the future protections of decreasing flows 
in the Colorado River and reduced snowpack in the Sierra Nevada 
Mountains have already caused Californians to actively begin 
implementing local and regional solutions to the threats to 
their water supplies and the environment. Other areas of the 
country are starting to follow suit.
    Through our Basin Studies program and implementation of the 
Secure Water Act, BOR is aggressively trying to assist in 
acquiring the data and improving the science related to future 
projections of water supplies so that effective adaptation 
strategies can be developed and implemented. In 2012, the Basin 
Studies program will continue west-wide risk assessments 
focusing on the threats to water supplies from climate change 
and other sources and will coordinate responsive actions with 
the Department's Landscape Conservation Cooperatives.
    BOR's science and technology program will also continue 
research that targets improved capability for managing water 
resources in the face of climate change, invasive species 
issues, as well as integrating renewable energy and energy-
efficiency activities into our water operations.
    A fifth initiative is very important to the administration 
and that is our longstanding commitment to the Secretary's goal 
to strengthen tribal nations. Assistant Secretary Castle has 
already mentioned our support for the Indian water rights 
programs. BOR is going to begin a number of implementation 
activities this year in support of the recently enacted four 
settlements, as well as continuing activities with respect to 
other Indian water rights settlements.
    I should note that we have requested $36 million for rural 
water projects which also support a number of tribal nations.

                           PREPARED STATEMENT

    Madam Chair, in conclusion, we appreciate again your 
support for BOR and the support of the subcommittee, and I will 
answer questions at the appropriate time.
    [The statement follows:]

                Prepared Statement of Michael L. Connor

    Thank you Madam Chair, Senator Alexander, and members of this 
subcommittee for the opportunity to discuss with you the President's 
fiscal year 2012 budget request for the Bureau of Reclamation (BOR). 
With me today is Bob Wolf, Director of Program and Budget.
    I appreciate the time and consideration this subcommittee gives to 
reviewing and understanding BOR's budget and its support for the 
program. BOR works hard to prioritize and define our program in a 
manner that serves the best interest of the public.
    Our fiscal year 2012 request continues support for activities that, 
both now and in the future, will deliver water and generate hydropower, 
consistent with applicable State and Federal law, in an environmentally 
responsible and cost-effective manner. Overall, our goal is to promote 
certainty, sustainability, and resiliency for those who use and rely on 
water resources in the West. Success in this approach will help ensure 
that BOR is doing its part to support the basic needs of communities, 
as well as providing for economic growth in the agricultural, 
industrial, and recreational sectors of the economy. In keeping with 
the President's pledge to freeze spending and focus on deficit 
reduction, this budget reflects reductions and savings where possible. 
Although the 2012 budget request allows BOR to fulfill its core 
mission, essential functions have been trimmed and economized wherever 
possible.
    The budget continues to emphasize working smarter to address the 
water needs of a growing population and assisting States, tribes, and 
local entities in solving contemporary water resource challenges. It 
also emphasizes the operation and maintenance of BOR facilities in a 
safe, efficient, economic, and reliable manner; assuring systems and 
safety measures are in place to protect the public and BOR facilities. 
Funding for each program area down to the individual projects within 
BOR's request is based upon adherence to administration, departmental, 
and BOR priorities. BOR is responsible for the oversight, operation, 
and maintenance of major Federal infrastructure that is valued at $87.7 
billion in current dollars. Key areas of focus for fiscal year 2012 
include Water Conservation, Landscape Conservation Cooperatives and 
Renewable Energy, Ecosystem Restoration, Youth Employment, supporting 
tribal nations and maintaining infrastructure. Recognizing the budget 
challenges facing the Federal Government as a whole, BOR will continue 
its efforts to partner with other Federal agencies such as the U.S. 
Army Corps of Engineers (COE), Department of Energy (DOE), and the 
Natural Resources Conservation Service, to maximize the efficiency by 
which we implement our programs.
    BOR's 2012 budget request is $1 billion, which includes $53.1 
million for the Central Valley Project Restoration Fund (CVPRF). This 
request is offset by discretionary receipts in the CVPRF, estimated to 
be $52.8 million. The request for permanent appropriations in 2012 
totals $194.5 million. Overall, BOR's 2012 budget is a responsible one 
and consistent with the administration's goal of fiscal sustainability. 
BOR will still be making strategic investments that provide a strong 
foundation to meet water resources challenges across the West.

              bor deg.WATER AND RELATED RESOURCES

    The 2012 budget request for Water and Related Resources, BOR's 
principal operating account, is $805.2 million, a decrease of $108.4 
million from the 2011 request.
    The request includes a total of $398.5 million for water and 
energy, land, and fish and wildlife resource management and development 
activities. Funding in these activities provides for planning, 
construction, water conservation activities, management of BOR lands 
including recreation, and actions to address the impacts of BOR 
projects on fish and wildlife.
    The request also provides a total of $406.7 million for water and 
power facility operations, maintenance, and rehabilitation activities. 
BOR emphasizes safe, efficient, economic and reliable operation of 
facilities, ensuring systems and safety measures are in place to 
protect the facilities and the public. Providing the funding needed to 
achieve these objectives continues to be one of BOR's highest 
priorities.

 bor deg.HIGHLIGHTS OF THE FISCAL YEAR 2012 REQUEST FOR WATER 
                         AND RELATED RESOURCES

    I would like to share with the subcommittee several highlights of 
the BOR budget including an update on the WaterSMART (Sustain and 
Manage America's Resources for Tomorrow) Program and Interior's 
establishment of a Priority Goal target to enable capability to 
increase available water supply for agricultural, municipal, 
industrial, and environmental uses in the Western United States by 
490,000 acre-feet by the end of 2012.
    WaterSMART Program.--The request focuses resources on the 
Department of the Interior's WaterSMART program. The program 
concentrates on expanding and stretching limited water supplies in the 
West to reduce conflict, facilitate solutions to complex water issues, 
and to meet the growing needs of expanding municipalities, the 
environment, and agriculture.
    BOR proposes to fund the rebased WaterSMART program at $58.9 
million, $11 million below 2011 levels. The three ongoing WaterSMART 
programs include:
  --the WaterSMART Grant program funded at $18.5 million;
  --Basin Studies funded at $6 million; and
  --the title XVI Water Reclamation and Reuse program funded at $29 
        million.
    The rebased program adds the existing Water Conservation Field 
Services program, funded at $5.1 million, and participation by BOR in 
the Cooperative Watershed Management program, funded at $250,000. This 
is a joint effort with the USGS.
    Other significant programs and highlights include:
      Ecosystem Restoration.--In order to meet BOR's mission goals of 
        securing America's energy resources and managing water in a 
        sustainable manner for the 21st century, a part of its programs 
        must focus on the protection and restoration of the aquatic and 
        riparian environments affected by its operations. Ecosystem 
        restoration involves a large number of activities, including 
        BOR's Endangered Species Act recovery programs, which are 
        required in order to continue project operations and directly 
        address the environmental aspects of the BOR mission.
    The 2012 request provides $154.6 million for operating, managing 
and improving California's Central Valley Project (CVP). This amount 
supports Ecosystem Restoration including $34.8 million for the Red 
Bluff Pumping Plant and Fish Screen within the CVP, Sacramento River 
Division, which will be constructed to facilitate passage for 
threatened fish species, as well as providing water deliveries. The 
funding for the CVP also includes $10.5 million for the Trinity River 
Restoration program and $3 million from the CVP Restoration Fund which 
includes development of a comprehensive monitoring and adaptive 
management program for fishery restoration and construction of channel 
rehabilitation projects at various sites along the Trinity River.
    The request includes $26 million for Lower Colorado River 
Operations to fulfill the role of the Secretary as water master for the 
Lower Colorado River and implementation of the Lower Colorado River 
Multi-Species Conservation (MSCP) program which provides long-term 
Endangered Species Act compliance for the operations. Of this amount, 
$18.3 million for the MSCP program will provide quality habitat to 
conserve populations of 26 species.
    The budget requests $20 million for other Endangered Species Act 
Recovery Implementation programs, including $11 million in the Great 
Plains Region to implement the Platte River Endangered Species Recovery 
Implementation program. It also includes $6.2 million for the Upper 
Colorado and San Juan River Endangered Fish Recovery programs. This 
funding will continue construction of a system that automates canal 
operations to conserve water by matching river diversions with actual 
consumptive use demands and redirecting the conserved water to improve 
instream flows. Additionally, the Columbia/Snake River Salmon Recovery 
program funding of $17.8 million will be used for implementation of 
required Biological Opinion actions including extensive hydro actions, 
plus tributary habitat and hatchery initiatives.
    The fiscal year 2012 budget includes $18.6 million for the Klamath 
project, which supports studies and initiatives to improve water 
supplies to meet the competing demands of agricultural, tribal, 
wildlife refuge, and environmental needs in the Klamath River Basin.
    No funding is requested for the Klamath Dam Removal and 
Sedimentation Studies. These studies are being completed with funds 
previously appropriated and will be used to inform a Secretarial 
Determination in 2012 as to whether removing PacifiCorp's four dams on 
the Lower Klamath River is in the public interest and advances 
restoration of the Klamath River fisheries. The studies and Secretarial 
Determination are being carried out pursuant to an agreement with 
PacifiCorp and the States of California and Oregon.
    The fiscal year 2012 budget includes $23.6 million for the Middle 
Rio Grande project. Funds support the acquisition of supplemental non-
Federal water for Endangered Species Act efforts and low flow 
conveyance channel pumping into the Rio Grande during the irrigation 
season. Further, funding is used for recurring life-cycle river 
maintenance necessary to ensure uninterrupted, efficient water delivery 
to Elephant Butte Reservoir, reduced risk of flooding, as well as 
delivery obligations to Mexico.
    The Yakima River Basin Water Enhancement Project request is $8.9 
million, which will continue funding grants to the Benton and Roza 
Irrigation Districts and Sunnyside Division Board of Control, to 
implement conservation measures and monitor the effects of those 
measures on the river diversions.
    Cooperative Landscape Conservation and Renewable Energy.--BOR is 
actively engaged in developing and implementing approaches to 
understand, and effectively adapt to, the risks and impacts of climate 
change on western water management. The Basin Studies Program is part 
of Interior's integrated strategy to respond to climate change impacts 
on the resources managed by the Department, and is a key component of 
the WaterSMART Program. In 2012, the Basin Studies Program will 
continue West-wide risk assessments focusing on the threats to water 
supplies from climate change and other factors and will be coordinated 
through the Department's Landscape Conservation Cooperatives (LCCs). 
BOR will take the lead responsibility for establishing and coordinating 
work at the Desert and Southern Rockies LCCs. Included within BOR's 
Science and Technology program is water resources research targeting 
improved capability for managing water resources under multiple drivers 
affecting water availability, including climate change. This research 
agenda will be collaborated and leveraged with capabilities of the 
Interior Climate Science Centers.
    BOR is also working in partnership with DOE and COE in identifying 
opportunities to address the President's clean-energy goals through the 
development of new sustainable hydropower capacity as well as 
integrating renewable energy in our operations. The partnership with 
DOE and its Power Marketing Administrations will also assess climate 
change impacts on hydropower generation.
    Supporting Tribal Nations.--BOR has a long-standing commitment to 
realizing the Secretary's goal to strengthen tribal nations. Fiscal 
year 2012 continues support through a number of BOR projects ranging 
from endangered species restoration to rural water and implementation 
of water rights settlement actions.
    The request includes $12.8 million for the Animas-La Plata project 
to continue constructing components of the Navajo Nation Municipal 
Pipeline and filling Lake Nighthorse as the project nears completion.
    The fiscal year 2012 BOR budget requests $35.5 million for on-going 
authorized rural water projects. The projects that benefit tribal 
nations include Mni Wiconi, the rural water component of the Garrison 
Diversion Unit, Fort Peck Reservation/Dry Prairie, Jicarilla Apache 
Reservation, and Rocky Boys/North Central Montana. One other rural 
water project that does not directly affect tribes is the Lewis and 
Clark Project. Funding for the Perkins County Project is complete. The 
first priority for funding rural water projects is the required O&M 
component, which is $15.3 million for fiscal year 2012. For the 
construction component, BOR allocated funding based on objective 
criteria that gave priority to projects nearest to completion and 
projects that serve on-reservation needs.
    The request includes $7 million for the Native American Affairs 
program to provide technical support for Indian water rights 
settlements and to assist tribal governments to develop, manage and 
protect their water and related resources. The Columbia/Snake River 
Salmon Recovery, Klamath, Central Valley Project Trinity River 
Restoration, Yakima and Yakima River Basin Water Enhancement Projects 
mentioned above under Ecosystem Restoration benefit tribal nations. 
Also, the newly established Indian Water Rights Settlement Account 
discussed below supports tribal nations.
    Youth Employment.--To meet the Secretary's challenge to achieve the 
Priority Goal for youth employment, BOR is working hard to engage, 
educate, and employ our Nation's youth in order to help develop the 
future stewards of our lands. Secretary Salazar challenged the Interior 
Bureaus to increase employment of youth between the ages of 15 and 25 
in natural and cultural resource positions. Last year, BOR began 
working with youth conservation corps to hire youth and expose them to 
the great work that it does. We continue to use all hiring authorities 
available to bring young people in through internships, crew work, and 
full time positions.
    Aging Infrastructure.--Through BOR's continued emphasis on 
preventive maintenance and regular condition assessments (field 
inspections and reviews), the service life of many BOR assets and 
facilities have been extended, thereby delaying the need for 
significant replacements and rehabilitation efforts, including the 
related funding needs. Although BOR and its project beneficiaries have 
benefited greatly from this preventive maintenance, we recognize that 
as assets and facilities age, they require an increased amount of 
maintenance. Sometimes this requires more frequent preventive 
maintenance, and, in other situations, significant extraordinary 
maintenance, rehabilitations, or replacements may be required.
    It is important to note that much of the Operation and Maintenance 
(O&M) funding responsibilities of BOR's assets lies with our project 
beneficiaries and those operating entities that operate and maintain 
federally owned transferred works. For some operating entities and 
project beneficiaries, rehabilitation and replacement needs may exceed 
available resources. In particular, many smaller irrigation or water 
conservancy districts are unable to fund these needs in the year 
incurred absent long-term financing assistance. To address this issue, 
the administration is currently exploring strategies for helping these 
entities to rehabilitate these facilities. We are also exploring 
potential utilization of the authority provided under Public Law 111-11 
that would allow extended repayment of extraordinary (nonroutine) 
maintenance costs on project facilities. Water users are currently 
required by Federal reclamation law to pay these costs, which are often 
substantial, in advance.
    BOR's fiscal year 2012 proposed budget is $40.8 million in 
appropriations for various projects for Replacements, Additions, and 
Extraordinary Maintenance (RAX) activities where BOR is directly 
responsible for daily O&M. This request is central to mission 
objectives of operating and maintaining projects to ensure delivery of 
water and power benefits. BOR's RAX request is part of its overall 
Asset Management Strategy that relies on condition assessments, 
condition/performance metrics, technological research and deployment, 
and strategic collaboration to continue to improve the management of 
its assets and deal with its aging infrastructure challenges. This 
amount represents only the fiscal year 2012 request for discretionary 
appropriations. Additional RAX items are directly funded by revenues, 
customers, or other Federal agencies.
    The Bonneville Power Administration will continue to provide up-
front financing of power operation and maintenance and for major 
replacements and additions for the power plants at the Boise, Columbia 
Basin, Hungry Horse, Minidoka, Rogue River, and Yakima projects. In the 
Great Plains (GP) Region, BOR, Western Area Power Administration, and 
COE have entered into an agreement which enables the customers to 
voluntarily direct fund power RAX items. A long-term funding agreement 
with the customers for the Parker-Davis Project on the Colorado River 
was executed in fiscal year 1999. Fiscal year 2012 costs of operation, 
maintenance and replacement for this project will be 100 percent up-
front funded by the customers. To date, the Central Valley Project 
power O&M program is funded 100 percent by the customers, in addition 
to funding selected RAX items. BOR will continue to explore ways to 
reduce the Federal cost of its projects and programs.
    A total of $83.7 million is requested for BOR's Safety of Dams 
program, which includes $63.6 million directed to dam safety corrective 
actions; of that, $27.5 million is for work at Folsom Dam. Funding also 
includes $18.5 million for safety evaluations of existing dams and $1.6 
million to oversee the Interior Department's Safety of Dams program.
    BOR's request for Site Security is $25.9 million to ensure the 
safety and security of the public, BOR's employees, and key facilities. 
This funding includes $6.9 million for physical security upgrades at 
high-risk critical assets and $19.1 million to continue all aspects of 
bureauwide security efforts including law enforcement, risk and threat 
analysis, personnel security, information security, risk assessments 
and security-related studies, and guards and patrols.
    BOR continues efforts to reach agreements with non-Federal and 
Federal partners to share in the cost of water resource management and 
development. Cost-sharing of 50 percent for construction and 
rehabilitation of recreation facilities at various BOR reservoirs will 
continue. Additionally, BOR's current planning program seeks 50 percent 
cost-sharing on most studies. This reflects BOR's emphasis on 
partnerships for water management initiatives.

            bor deg.INDIAN WATER RIGHTS SETTLEMENTS

    On December 8, 2010 the President signed the Claims Resolution Act 
of 2010 that included four water settlements. These settlements resolve 
longstanding and disruptive water disputes, provide for the 
quantification and protection of tribal rights, and will deliver clean 
water to the Pueblos of Taos, Nambe, Pojoaque, San Ildefonso, and 
Tesuque in New Mexico, the Crow Tribe of Montana, and the White 
Mountain Apache Tribe of Arizona. In order to accomplish this, the act 
provides various mechanisms and funding structures designed for both 
construction and for the tribes to use to manage water systems 
following construction. The primary responsibility for developing water 
infrastructure under these settlements was given to BOR. Mandatory 
funding was provided to both BIA and BOR in 2011 for a portion of the 
funds established under the act. We anticipate that BOR will begin 
expending some of this mandatory funding to work with all parties to 
begin implementing these settlements.
    The four Indian water rights settlements will provide water 
supplies and offer economic security for the tribes and pueblos 
described above. The agreements will build and improve reservation 
water systems, rehabilitate irrigation projects, construct a regional 
multi-pueblo water system, and codify water-sharing arrangements 
between Indian and neighboring communities. Construction will take 
place over time and annual funding requirements will vary from year to 
year. Notwithstanding the availability of some level of mandatory 
funding, discretionary appropriations will still be necessary. BOR is 
requesting $26.7 million in 2012 for the initial implementation of 
these four settlements.
    BOR is establishing the Indian Water Rights Settlements account to 
assure continuity in the construction of the authorized projects and to 
highlight and enhance transparency in handling these funds. In 
establishing this account, BOR will also request $24.8 million for the 
Navajo-Gallup Water Supply project (title X of Public Law 111-11) in 
order to have major current funding for BOR's Indian Water Rights 
Settlements treated in the Claims Resolution Act in a single account.
    The Navajo-Gallup Water Supply Project will provide reliable and 
sustainable municipal, industrial, and domestic water supplies from the 
San Juan River to the Navajo Nation including:
  --the Window Rock, Arizona area;
  --the city of Gallup, New Mexico; the Navajo Agricultural Products 
        Industry; and
  --the southwest portion of the Jicarilla Apache Nation Reservation.
    The total request for BOR for Indian Water Rights Settlements in 
2012 is $51.5 million in discretionary funding and $60 million in 
permanent funds.

               bor deg.POLICY AND ADMINISTRATION

    The 2012 budget request for the Policy and Administration 
appropriation account, the account that finances BOR's central 
management functions, is $60 million or 6 percent of the total request, 
a reduction of $1.2 million from the 2011 request. This reduction 
reflects the impact of the pay freeze and the Administrative Cost 
Savings discussed below.

      bor deg.ADMINISTRATIVE COST SAVINGS AND MANAGEMENT 
                              EFFICIENCIES

    The 2012 budget request includes reductions that reflect the 
Accountable Government Initiative to curb nonessential administrative 
spending in support of the President's commitment on fiscal discipline 
and spending restraint. In accordance with this initiative, BOR's 
budget includes $5.8 million in savings in 2012 against actual 2010 
expenditures in the following activities: travel and transportation of 
persons, transportation of things, printing and reproduction, and 
supplies and materials. Actions to address the Accountable Government 
Initiative and reduce these expenses build upon management efficiency 
efforts proposed in 2011 totaling $3.9 million in travel and 
relocation, Information Technology, and strategic sourcing and bureau-
specific efficiencies totaling $1.3 million.

        bor deg.CENTRAL VALLEY PROJECT RESTORATION FUND

    The 2012 budget includes a request of $53.1 million for the CVPRF. 
This budget request is offset by collections estimated at $52.8 million 
from mitigation and restoration charges authorized by the Central 
Valley Project Improvement Act. The request considers the effects of 
the San Joaquin River Restoration Settlement Act (Public Law 111-11, 
March 30, 2009) which (beginning in 2010) redirects certain fees, 
estimated at $5.6 million in fiscal year 2012, collected from the 
Friant Division water users to the San Joaquin River Restoration Fund.

          bor deg.SAN JOAQUIN RIVER RESTORATION FUND

    The fiscal year 2012 budget also reflects the settlement of Natural 
Resources Defense Council v. Rodgers. BOR proposes $9 million in 
discretionary funds into this account, which was established by the San 
Joaquin River Restoration Settlement Act. Under the Settlement, the 
legislation also provides for approximately $2 million in annual 
appropriations for the Central Valley Project Restoration Fund for this 
purpose, as well as mandatory funds. The Fund seeks to provide a 
variety of physical improvements within and near the San Joaquin River 
within the service area of the Friant Division long term contractors to 
achieve the restoration and water management goals. These funds are 
important for BOR to meet various terms of the settlement that brought 
water contractors, fishery advocates, and other stakeholders together 
to bring to an end 18 years of contentious litigation.

         bor deg.CALIFORNIA BAY-DELTA RESTORATION FUND

    The 2012 budget requests $39.7 million for CALFED, pursuant to the 
CALFED Bay-Delta Authorization Act. The request focuses on the Bay-
Delta Conservation Plan and interagency science efforts to address 
short- and long-term water resource issues. Other activities include a 
renewed Federal/State partnership, Smarter Water Supply and Use, and 
addressing the degraded Bay-Delta Ecosystem actions which include 
Federal participation in the Bay Delta Conservation Plan and 
interagency science efforts to address short- and long-term water 
resource issues based on the Interim Federal Action Plan. The CALFED 
Bay-Delta Program was established in May 1995 to develop a 
comprehensive long-term plan to address the complex and interrelated 
problems in the Delta region, tributary watersheds, and delivery areas. 
The Program's focus is on conserving and restoring the health of the 
ecosystem and improving water management, including Federal 
participation in the Bay Delta conservation Plan.

          bor deg.FISCAL YEAR 2012 PLANNED ACTIVITIES

    BOR's fiscal year 2012 goals are directly related to fulfilling 
contractual requests to deliver water and power. Our goals also address 
a range of other water supply needs in the West, playing a significant 
role in restoring and protecting freshwater ecosystems consistent with 
applicable State and Federal law, enhancing management of our water 
infrastructure while mitigating for any harmful environmental effects, 
and understanding and responding to the changing nature of the West's 
limited water resources. It should be emphasized that in order to meet 
BOR's mission goals of securing America's energy resources and managing 
water in a sustainable manner for the 21st century, a part of BOR's 
programs must focus on the protection and restoration of freshwater 
ecosystems.
    By the end of fiscal year 2012, BOR will enable capability to 
increase available water supply for agricultural, municipal, 
industrial, and environmental uses in the Western United States by 
490,000 acre feet through its conservation-related programs, such as 
water reuse and recycling (title XVI), and WaterSMART grants. BOR will 
maintain dams and associated facilities in good condition to ensure the 
reliable delivery of water. It will maximize the percent of time that 
its hydroelectric generating units are available to the inter-connected 
western electrical system during daily peak demand periods.
    Moreover, the fiscal year 2012 budget request demonstrates BOR's 
commitment to meeting the water and power needs of the West in a 
fiscally responsible manner. This budget continues BOR's emphasis on 
managing those valuable public resources. BOR is committed to working 
with its customers, States, tribes, and other stakeholders to find ways 
to balance and provide for the mix of water resource needs in 2012 and 
beyond.

                               CONCLUSION

    Madam Chair, please allow me to express my sincere appreciation for 
the continued support that this subcommittee has provided BOR. This 
completes my statement. I would be happy to answer any questions that 
you may have at this time.

    Senator Feinstein. Thank you very much.

             COE deg.HARBOR MAINTENANCE TRUST FUND

    I want to go back to the Harbor Maintenance Trust Fund 
because it seems to me that there is a catch 22, and that is 
that the trust fund is going to be used for other things and 
that there are no authorized widths or depths for dredging. 
Therefore, ports will be haphazardly dredged. I am sorry 
Senator Graham is not here because he was interested in the 
Port of Charleston. I do not know how you will select those 
ports that get dredging versus those that do not because there 
are no earmarks, and I think that is going to make it very 
difficult in the COE budget to know what you do and what you do 
not do. And so I am particularly disturbed by what I see coming 
to really handcuff the Harbor Maintenance Trust Fund.
    Could you respond to that?
    General Van Antwerp. First of all, Senator, I would like to 
say that the way that we prioritize our dredging is we look for 
a number of factors. We put them through a sieve of 
prioritization. What is the shoaling that happens in there? 
What is the commercial nature of that port or harbor?
    As kind of an overview, we have 59 ports and harbors that 
carry about 90 percent of the waterborne cargo of this country. 
It is about $1.4 trillion through our ports and harbors. So 
there are some that are what we call very high-commercial-use 
harbors.
    We take the navigation or the dredging dollars and spread 
them as well as possible over those with the highest traffic 
that we can. It is not haphazard in the sense that it does not 
have a prioritization scheme to it. It absolutely does. We do 
high use, medium use, and low use.
    Senator Feinstein. Right. You have 59 ports. You have a lot 
of work to do. Why would you want to have other activities take 
money from this trust fund, and what would those other 
activities be?
    Ms. Darcy. Senator, the proposal that is being developed 
within the administration is looking at a number of things. It 
has not been developed yet. Some examples of things that might 
be looked at to receive some of this funding would be increased 
security needs at ports. We are trying to look at the Nation's 
ports as a whole system and what commercial navigation needs 
there are and what can be provided through the Trust Fund.
    Also, the Trust Fund balance--as you noted, about $1.4 
billion comes in annually, and then that is appropriated. So if 
you were concerned about the depletion of the balance that can 
be managed by the appropriations process.
    Senator Feinstein. Well, let me just say I hope so. You 
know, we have the largest port in the Nation. Forty-five 
percent of the container traffic comes in and out of the Port 
of LA--Long Beach. If you are not dredging that port to its 
fullest, if you scrimp on that, the whole thing shuts down. And 
so I do not understand using this money for security dollars. 
It seems to me keeping these ports viable is really an 
important mission, and it in itself absorbs all the money.
    Ms. Darcy. When developing the proposal, all of those 
things will be considered. As I said, the proposal is still 
under development within the administration, and we will be 
considering these and many other factors.
    Also, whatever proposal we develop will have to be 
developed with all of you because it would require legislative 
changes. So the Finance Committee would have to be involved, as 
well as the authorizing and appropriations committees.
    Senator Feinstein. How much surplus is in the trust fund?
    Ms. Darcy. I think the current estimate is about $5.8 
billion.
    Senator Feinstein. Five point eight billion dollars. And 
how much will be used on port dredging this year?
    Ms. Darcy. The President's request is for $758 million.
    Senator Feinstein. That is all.
    Ms. Darcy. Yes.
    Senator Feinstein. I am glad Senator Graham just came back 
because what we just learned was that there are $7 billion in 
the port trust fund for dredging, but only $700 million-plus is 
being put forward by the administration for dredging.
    I guess what I am telling you as chairman--I do not know if 
others would agree with it--but that is not the right thing to 
do. You have to keep these ports viable. So if you have a 
response to that, I would appreciate it. If you do not, that is 
okay too.
    Ms. Darcy. The proposal that is being developed is looking 
at the commercial ports from all of the needs, including 
navigation and including keeping them dredged at a viable 
depth.
    Senator Graham. Madam Chairman, could I just----
    Senator Feinstein. Yes, please. Go ahead, Senator.
    Senator Graham. As I understand it, there is a difference 
between maintaining a port, dredging, and actually a new start 
where you would deepen the harbor. Is that correct?
    Ms. Darcy. Yes, Sir.
    Senator Graham. So I think I understand a little bit about 
their dilemma. Once you get a harbor at a certain depth, there 
is a trust fund to keep it dredged at that depth. What we are 
talking about in Charleston and Savannah and other places is 
actually going lower than the approved level, which would 
probably be a different exercise financially, is that correct 
General.
    General Van Antwerp. That is correct.
    Senator Graham. I have learned more about this than I ever 
wanted to learn.
    General Van Antwerp. You know a lot about this, Senator.
    Senator Graham. Yes, the hard way. I just want 40,000 
bucks, $40,000. I am really cheap.
    General Van Antwerp. To go deeper in a port, it is largely 
based on the benefit-cost ratio, its commercial use, and its 
national economic benefit. This year, in new starts we are at 
2.5 benefit-to-cost ratio for inclusion in the budget.
    Senator Feinstein. Trust me. He will want more than 
$40,000. The $40,000 is just a study.
    All right, I think I have consumed enough time.
    Senator Alexander.
    Senator Alexander. Thank you, Madam Chair.
    I have actually learned a good bit about the Charleston 
Port as well over the last few days. And I know you have. We 
all feel very well educated about it. But it does not have a 
finer advocate than Senator Graham anywhere in the United 
States.

                   COE deg.CHICKAMAUGA LOCK

    Secretary Darcy, have you ever visited the Chickamauga 
Lock?
    Ms. Darcy. I have not, Senator.
    Senator Alexander. Are you aware of its current condition?
    Ms. Darcy. I have been briefed about its current condition. 
I know that the Chief and the Commanding General from the Great 
Lakes and Ohio River Division have been there, however.
    Senator Alexander. What are your projections about how long 
it can be reliably operated and maintained?
    Ms. Darcy. I am not sure that we have those. Do we, 
General?
    General Van Antwerp. Well, first of all, we think there is 
a low probability of failure right now, but we are watching it 
closely. We have gauges. We are watching that to give pre-
notification if there is going to be a failure. There is no 
question we are watching the maintenance curve on this and it 
grows and grows every year, and at some point it goes to the 
point that you have got to make the improvements and you must 
fix it.
    Senator Alexander. Well, is it not true that it is in 
danger of a catastrophic failure?
    General Van Antwerp. We feel the probability right now is 
low to moderate.
    Senator Alexander. How much maintenance funding will be 
needed to keep it open over the next 5 or 10 years?
    General Van Antwerp. I would say about $2 million to $3 
million every year. But I could see somewhere in the near term 
that it's going to be about $15 million per year because there 
are some things that are going to have to be done. That is if 
we just stay on the maintenance track, but $2 million to $3 
million probably for the next 5 years each year.
    Senator Alexander. Have you considered asking the Tennessee 
Valley Authority to contribute funds to the replacement of the 
lock?
    General Van Antwerp. Senator, I am not sure if we have had 
the discussion on whether they would want to provide funds for 
that.
    Senator Alexander. Finally, when is work scheduled to 
resume on the project?
    General Van Antwerp. Well, right now we are in the process 
of building the cofferdam. In the fiscal year 2012 budget there 
is zero funding for it. At some point the project would cease 
and we would button it up and then wait for future funding to 
continue.

              COE deg.INLAND WATERWAY TRUST FUND

    Senator Alexander. Secretary Darcy, we talked a moment ago 
about the Inland Waterway Trust Fund. It is in a little 
different shape, is it not? It does not have much money in it.
    Ms. Darcy. No, it does not.
    Senator Alexander. What does it have?
    Ms. Darcy. I think the current balance that we have in our 
budget request for 2012 coming from the Trust Fund is $77 
million.
    Senator Alexander. Is it true that that is about enough for 
one project this year?
    Ms. Darcy. It is about enough for maybe three.
    Senator Alexander. Maybe three.
    There was a plan that the commercial users of the Inland 
Waterway Trust Fund worked on and I believe worked on with the 
administration in which they basically worked out a proposal to 
increase the fuel tax on themselves on their own fuel in order 
to put more money into the Inland Waterway Trust Fund so that 
locks like the Chickamauga Dam and other needed projects could 
be done. But it is my understanding that you wrote a letter to 
Congressman Oberstar disagreeing with the plan last year.
    Does the administration have its own plan to enhance the 
revenues in the Inland Waterway Trust fund? And when will we 
see the plan if there is such one planned?
    Ms. Darcy. Senator, we are working with the Inland Waterway 
Users Board and the industry to develop a plan to increase the 
funding in the trust fund, as well as looking at ways to 
equitably charge the users in the future.
    Senator Alexander. Well, what was wrong with the plan that 
was rejected last year?
    Ms. Darcy. There were many recommendations and some of them 
shifted the cost share burden to the general Federal taxpayer 
and took it away from the user. So that was one of the major 
objections.
    Senator Alexander. Excuse me. I was talking and I did not 
hear your entire answer.
    Ms. Darcy. There were cost share changes developed that 
would shift a lot of the burden back to the general Federal 
taxpayer as opposed to the direct user.
    Senator Alexander. And when will your proposal be ready for 
us to see?
    Ms. Darcy. I do not know, Senator, hopefully soon.
    Senator Alexander. Well, does ``soon'' mean a matter of a 
few months or a few years or what?
    Ms. Darcy. I think it is in between. It is less than a few 
years and more than a few months.
    Senator Alexander. Well, there is a certain urgency to this 
when you have the users of the waterways, who are agreeable to 
contributing extra dollars to create projects that all of us 
believe are important for new jobs. I think the sooner, the 
better. So I would like to urge you to make it a priority and 
let us see it as soon as possible.
    Ms. Darcy. Yes, Senator.
    Senator Alexander. Thank you.
    Senator Feinstein. Thank you very much, Senator.
    I will read the list. It is Johnson, Landrieu, Cochran, 
Tester, Graham, Collins, Reed, Lautenberg and Murkowski, so 
Senator Johnson.
    Senator Johnson. Thank you, Madam Chairman.
    Commissioner Connor, I am extraordinarily concerned about 
inadequate funding request for ongoing congressionally 
authorized rural water projects. Two of these projects, Mni 
Wiconi and the Lewis and Clark regional water system, are vital 
infrastructure projects in South Dakota. In your budget 
request, the seven authorized drinking water projects would 
receive a total of just $35 million, with $15 million of that 
for operations and maintenance. That leaves about $20 million 
for construction for the projects. My understanding is that 
past BOR analysis shows that it would take $58 million per year 
in construction dollars just to keep up with inflation. The 
math here just does not work.
    Especially for Lewis and Clark, the States of South Dakota, 
Iowa, and Minnesota, as well as the 20 member-cities and rural 
water systems, have prepaid $153.5 million which represents 
99.7 percent of their cost share. They have prepaid their share 
in some cases a decade or more before they will receive water. 
The Federal Government has nearly one-half of its cost sharing 
remaining. The proposed fiscal year 2012 budget only includes 
$493,000 for Lewis and Clark which would not allow for any new 
construction.
    Can you assure these cities and rural water systems that 
the Federal Government is, indeed, committed to finishing this 
important water project in a reasonable time? What is the plan 
for funding authorized water projects beyond this budget, 
because this request takes us and the taxpayers backwards on 
our investment, could you respond to that?
    Mr. Connor. Yes, Sir, Senator Johnson.
    Without a doubt, the rural water program is the program in 
our budget that has taken the biggest decrease in funding this 
year.
    As to your specific question about whether the Federal 
Government is committed to these projects, we are, but it is 
going to be very tough in these tight fiscal times. I say we 
are because we invested more than $950 million in Recovery Act 
funds. We invested $200 million initially in these rural water 
projects, and then recognizing that they were a good 
investment, given ARRA parameters, we allocated another $32 
million toward, I think, five of those projects near the end of 
last year. So we were trying to use those resources as best as 
possible to continue to move those projects out and serve 
additional communities. But in the priority order that we look 
at our budget and the resources we have available this year--
they are good programs and good projects, but are just running 
short on the funds available.
    We are going to go back and take a look pursuant to the 
2006 Rural Water Act. We owe the Congress a report on the 
status of these projects and how we can look forward toward 
trying to complete them. We are going to get that done this 
summer. We will look at some additional criteria that we may 
want to add, and we will see what we can do as far as looking 
at the resources to try and make more progress in addition to 
the progress that we already made with ARRA funds.
    Senator Johnson. Do you have any suggestions for what the 
20 communities and rural water systems that exist and are using 
99.7 percent of the cost share will do in the future?
    Mr. Connor. Well, we will work with those communities and 
see how in these tight budget times we can make strategic 
investments and phase in incrementally those aspects of the 
project and serve additional people. I recognize that the Lewis 
and Clark project is having significant problems. Our primary 
focus, beyond once we address the operation and maintenance 
obligations that we have, is to try and complete projects, and 
we did complete the Perkins County project in South Dakota and 
we are trying to ensure we can complete the Mni Wiconi project 
in 2013.
    Senator Johnson. Mr. Commissioner, I too am eager to see 
this important project completed, the Mni Wiconi project, and I 
appreciate that BOR has placed a high priority on the project. 
Unfortunately, construction funds are still falling short of 
what is needed to keep the project on pace and overhead and 
contract costs have hindered construction. It is my 
understanding that reduced funding will have an impact on the 
ability to complete this and other projects within their 
statutory timeframes. Will you review the project authorization 
and recent funding levels and work with the Congress to ensure 
that this project is completed as envisioned?
    Mr. Connor. We will certainly work with you. With respect, 
the vast majority of our construction funds proposed for 2012 
are for Mni Wiconi, but we still think that puts us in the area 
of being able to complete our obligations by 2013. But we will 
review that and we will definitely work with you, Sir.
    Senator Johnson. My time has expired. Thank you.
    Senator Feinstein. Thank you very much, Senator Johnson.
    Senator Landrieu.
    Senator Landrieu. Thank you very much.
    Let me begin, Senator Feinstein and Senator Alexander, to 
tell you how much I look forward to working with you on this 
subcommittee. It is a very important subcommittee for our 
Nation and particularly for the State that I represent. In 
Louisiana, we have the opposite challenges of some of the West 
Coast States. We have too much water, not too little water, and 
we are struggling to manage that.
    Let me also add, General Van Antwerp, thank you for your 
leadership and for your guidance as we have designed and built 
some of the most sophisticated levee and flood control systems 
ever constructed in this Nation in the aftermath of the 
catastrophe, the biblical flood that we had when the Federal 
levee system collapsed 5\1/2\ years ago in and around the city 
of New Orleans, and we are on the back end of some of that.
    And for the subcommittee, I want to thank all of you who 
were on the subcommittee before and will continue to serve 
because the $2 billion surge barrier, which is the largest 
surge barrier ever constructed in this Nation's history, is now 
up and operational. And I think we are going to be down there 
celebrating this milestone sometime in June. And I am pleased 
that we took several trips to the Netherlands to see the model 
of some of this technology. And I am pleased to share with the 
subcommittee, that having walked over the surge barrier and 
seen the construction of it in a detailed brief, that you can 
be very proud of the engineering that has gone in.
    Having said all those good things, let me say that there 
are still extraordinary challenges that are reflected in this 
budget. And I know that you are dealing with very limited 
resources. But I want to add my concern. And I have a question 
about this interior waterway trust fund.
    Senator Levin and Senator Hutchison and myself and a few 
others have introduced a bill to attempt, Senator Feinstein and 
others, Senator Alexander, to capture the money coming into 
this trust fund so that it actually can be used for the 
processes in which it was intended, which is dredging and 
maintenance of these ports. I think the chairman is absolutely 
correct that for trade and for jobs, it is just critical.
    So, number one, are you aware of the legislation, Madam 
Secretary? Number 2, is the administration going to support the 
basically capturing of these revenues to maintain these very 
important ports and channels?
    Ms. Darcy. Senator, I am aware of the legislation to keep 
what is coming into the Trust Fund for the navigation purposes 
that it was intended. In our budget, the administration has 
proposed using some of those funds, as you know, for the 
continued maintenance of the navigation channels. However, we 
are looking at using that funding for some other----
    Senator Landrieu. Well, I just want to lay a warning that 
there is a growing number of Senators on both sides of the 
aisle that want the taxes paid by this industry to be used for 
the purposes in which they thought they were being taxed, which 
is the dredging and keeping open of these ports.

             COE deg.ALLOCATIONS WITHOUT EARMARKS

    I want to ask a question and also make a point that while 
90 percent of the cargo--and the question following up the 
chairman--how will you allocate now that there are no earmarks 
or directives from this subcommittee allowed? And you said we 
will go by a formula. The big cargo ports will get, you know, 
based on how much cargo comes in and out. I just want to remind 
everybody on the subcommittee for the record there are ports 
that are important to the Nation that are not cargo ports. We 
would call them ``energy ports.'' And if they do not stay open, 
nobody gets electricity, oil, gas, natural gas that comes into 
the ports along the gulf coast. The chairman might want to know 
we are not even included in the formula to begin with because 
unless you are a cargo port, you do not even get considered.
    I tried to change that legislatively. You can imagine with 
natural gas coming into the country that port cannot get 
dredging because it is light. It is not heavy and it is not 
cargo. It is gas. It is liquid gas that comes in.
    So this is a very interesting subject, and I just want to 
go on record. Senator Cochran knows some of this because, of 
course, he represents the State of Mississippi which has very 
similar concerns to the State of Louisiana. But that is one 
question.
    And on the second, when we have, General Van Antwerp--my 
last question--a 100-year flood protection which we are trying 
to achieve--the Netherlands protects their people 1 out of 
every 10,000 years. We are protecting our people 1 out of every 
100. So we on the international scale have a ways to go. And I 
know you cannot compare apples to apples there.
    But when we raise the levees to 100 years, my final 
question is, do you have money budgeted to maintain them at 
that, or what happens when there is settlement in those levees, 
because this is going to happen not just in south Louisiana 
along the gulf coast, but around the country. Is any of that 
budgeted in this budget to maintain those levees at the 100-
year protection?
    General Van Antwerp. Senator, for all the project features, 
once the ribbon is cut, it goes to local responsibility for the 
operation and maintenance of those levees and project features.
    We are considering subsidence and sea level rise over time. 
In fact, we know probably in the next 50 years, many of those 
levees will have to be raised, some due to sea level rise, some 
due to subsidence. So that is in the plan. Of course, that is 
not budgeted 25 years out. For that, we will have to cross that 
bridge when we come to it because of the way we do the 
budgeting. But it is planned for.
    And when we could, we purchased the real estate for, for 
instance, a wider base so that you could add to the height of 
that levee without having to get more real estate. If we could 
do that under the current funding, we did that. We are as ready 
as we can be, but we know we are going to have future 
maintenance of those facilities.
    Senator Landrieu. Thank you.
    Senator Feinstein. Thank you very much, Senator Landrieu.
    Senator Cochran.
    Senator Cochran. Madam Chairman, I am pleased to join you 
in welcoming the panel to our hearing to review the President's 
budget request for the subjects that we are discussing.
    I cannot help but wonder about how we reconcile the 
economic requirements of being a robust exporter of goods and 
services and commodities in the international marketplace with 
reducing the capacity to handle cargo on the Mississippi River 
in its ports and in other transportation modes which would get 
our goods and services to those who are buying what we are 
selling and what we are growing in terms of agriculture 
production in the lower Mississippi River Valley and way 
beyond.
    We have up-to-date information about the fact that $100 
billion in exports is traversing the Mississippi River 
annually. Industries in more than 30 States--we are not talking 
about just Mississippi and Louisiana. We have great interest in 
this subject. But industries in more than 30 States rely on COE 
to help maintain the river at authorized levels and depths. 
Insufficient dredging and an inadequacy of funding for these 
activities would inevitably result in restrictions on ship 
traffic and cargo travel. To put it in perspective, some 
shippers estimate that a 1-foot reduction in depth means a ship 
must reduce its cargo by 1,500 tons.

       COE deg.MISSISSIPPI RIVER AND TRIBUTARIES PROJECT

    The objective of the Mississippi River and Tributaries 
project was to uphold, maintain, and improve the Mississippi 
River system and its levees that contain it. And in face of 
those national interests, the President's budget request for 
the Mississippi River and Tributaries project is $210 million. 
That is $130 million below the fiscal year 2010 discretionary 
budget authority.
    How are you going to cope with that reality? May I ask the 
panel if anybody has any suggestion about what you are going to 
do?
    General Van Antwerp. Well, first of all, Senator, your 
observations are correct. We have 12,000 miles of inland 
waterways that are maintained by COE and it touches really 41 
States in our Union and is so incredibly important. We 
understand that.
    I think what you will see when we have to prioritize is we 
try and keep the depth. What normally happens is that you 
reduce the width first. It means that you cannot have ships 
passing and you have to stage them.
    The other part is to keep the locks open. We have 241 locks 
on our waterways. They are 58.3 years old on average. So the 
maintenance requirements are increasing. We prioritize those by 
the greatest risk. We do treat our waterways as a system. We 
have to keep the whole system open. If we have one lock go 
down, it can impact the whole waterway.
    Senator Cochran. May I also ask another question about the 
Mississippi Yazoo back water project. This is an issue that has 
been around since 1941. The Congress has authorized and funded 
these activities that are connected to this project in the 
lower Mississippi River delta. And we had a recent decision in 
Federal court that canceled a project, in effect, or a decision 
was made not to proceed with the project because of a decision 
made by a Federal court judge in Mississippi.
    This still remains a very troublesome issue to resolve, and 
I bring it up simply because I hope COE and others who are 
interested in this will work with the supporters of the project 
to try to reconcile differences and to come up with an 
alternative that would be satisfactory with COE . I do not have 
any magic solution to suggest. We would be glad to work and 
cooperate with the administration and with others in the 
Congress who are interested in this, but I raise the question 
so we have it as the beginning of another effort.
    Thank you.
    Senator Feinstein. Thank you very much, Senator Cochran.
    Senator Tester, you are next.
    Senator Tester. Yes, thank you, Madam Chair.
    First of all, I want to express my appreciation for you all 
folks being here today. Water is our most valuable resource and 
the management of it is critically important.
    As the questions and the comments have been expressed here 
today, I have got to tell you; you guys are in a tough 
position. I mean, since this Congress started, we have been 
talking about deficit and debt, and we are giving you hell 
because you are not spending enough money. And I think that 
there has to be an awakening here, if we are going to invest in 
infrastructure, that investment means spending money. And I 
will tell you that water, whether it is where it flows into the 
ocean or whether it is at the headwaters in a State like mine, 
is very, very important, and if we do not have the 
infrastructure to manage it, we will not manage it and the 
country will be poorer for it.
    Secretary Darcy, we have visited in the past about the 
great city of Great Falls in Cascade County and a couple levees 
that they have there that were built in 1975. COE has certified 
those levees up until 2009, and the Corps decided not to 
certify any more levees.
    When you were last before the Senate, you told my 
colleague--the senior Senator from Montana--Max Baucus, that 
you would immediately look into the policy whether it should be 
changed, and that is whether FEMA either could certify or COE 
could certify to FEMA standards, one or the other. What have 
you found out?

                  COE deg.LEVEE CERTIFICATION

    Ms. Darcy. You are correct, Senator. I did tell Senator 
Baucus we would look into the policy and we have begun doing 
that. In the past, as you said, we certified levees and used 
Federal funds for that, and since 2008 we have not budgeted for 
that certification. We are looking at whether that is a 
possibility for us in the future.
    Senator Tester. And I will tell you that FEMA gives out the 
Provisionally Accredited Levee agreement. Okay, and they told 
Great Falls here about a month--you either got to sign it or 
forget it. COE has inspected in the past. Is there any 
potential you could harmonize your criteria? Have you done any 
work on that at all?
    Ms. Darcy. We have done some work on it, but to be quite 
honest, it is not harmonized at this point.
    Senator Tester. I mean you fully understand the issue. You 
fully understand that there is not an engineering firm around 
that has an errors and omissions policy big enough that they 
will certify it. I mean, that is really what they have found 
out. And you know what? I think there are a lot of Great Falls, 
Montana up and down the different drainages in this country. 
And I will tell you that for that reason, Senator Baucus and I 
are dropping in legislation that gives COE not only the 
authority but the responsibility to certify those.
    Once again, it may or may not cost money. You may be able 
to do it within your budget. You may need additional funds, but 
the fact is it has got to be done or folks are going to be put 
in flood plains. Businesses are not going to be able to be 
allowed to grow, some of the same things we heard earlier, only 
it just applies to this levee thing.
    The intake dam, for either one of you, General Van Antwerp 
or Secretary Darcy, the work has begun rebuilding intake, and 
it is a rock ramp. I do not know if you are familiar with it or 
not. If you are familiar with it, I will not mess around 
anymore. But since you were here last year, the cost estimate 
jumped more than $100 million. The thing is never going to be 
built if it is $100 million, I will just tell you. Something is 
going to have to happen.
    Can you give me your thoughts on why we had such a jump in 
cost on a project like intake?

           COE deg.YELLOWSTONE INTAKE DIVERSION DAM

    General Van Antwerp. Well, I guess in a few words, it is 
very complicated. I will give you a couple of those 
complications, Senator.
    First of all, the rock ramp at the depth and velocity that 
the pallid sturgeon needed was not working as we thought it 
would. We have had to make modifications. The modeling 
indicated a need for a much flatter side slope than the 
preliminary design. So that is, in a nutshell, the biggest 
piece of this.
    Senator Tester. The word I heard is they are bringing in 
rock from somewhere else.
    General Van Antwerp. Well, the contractor has to bring in 
the rock to do it. Where he purchases it from is up to the 
contractor.
    Senator Tester. And so it is an open-ended contract. I 
mean, if he wants to bring in rock from Maine, we pay for it?
    General Van Antwerp. Well, he has to meet the design 
criteria with the rock he brings in. He has to do it under the 
bid that he proposed. I do not believe this is a cost-plus 
contract.
    Senator Tester. Okay, but what I am saying is we started 
out this project was going to cost--and I cannot remember--$15 
million and now it is up more than $100 million.
    Senator Feinstein. Would you permit me?
    Senator Tester. Yes.
    Senator Feinstein. Why can you not have Montana rock?
    General Van Antwerp. You could if it meets the 
specifications. I think our contractors certainly would go out 
and get it at the best place they could get it for the right 
price. They are on the clock also.
    Senator Tester. I appreciate that, Madam Chairman, because 
that is exactly the question. And I do not know if this is 
factual or not. I am told by the locals that they are bringing 
rock from outside the area when there is rock there that will 
do the job.
    My time has run out, and I am going to check it off to 
people who have been here.
    But the fact is that there has got to be oversight and 
there also has to be some common sense put to the analysis. 
Look, I am all about paddlefish. I love them, but are we saving 
one paddlefish? Are we saving 50 percent of the paddlefish that 
go up the river? What are we getting for that $80 million or 
$90 million or more in additional spending? That is really kind 
of important.
    Before I go, thank you, General, for your service, I very 
much appreciate it. We are going to miss you. Thank you.
    Senator Feinstein. Thank you very much, Senator Tester.
    Senator Collins.
    Senator Collins. Thank you, Madam Chairman. I am very 
pleased that I am next because I feel I need to clarify that 
rock from Maine is not responsible for cost growth from $15 
million to $100 million. We do have outstanding rock in Maine.
    Senator Tester. I hear it is some of the best in the world.
    Senator Collins. It is Great granite, which we would be 
happy to share with your State. But I am positive that is not 
the cause of the problem.
    I do have two Maine-specific issues that I want to discuss 
with our witnesses today.

                    COE deg.KENNEBEC RIVER

    Secretary Darcy, as I am sure you recall, I wrote to you 
last month about a problem with the Kennebec River. And this is 
a very serious problem. I am hearing a lot of serious problems 
today.
    Earlier this year, COE conducted a sweep survey of the 
Kennebec River that concluded that the controlling depth is now 
an alarming 19.7 feet, significantly less than the authorized 
27 feet.
    Now, let me explain to my colleagues why this matters. Bath 
Iron Works, which builds naval destroyers, uses the Kennebec 
River as the avenue for getting the ships to sea. And in 
October, the USS Spruance naval destroyer is scheduled to 
depart Bath Iron Works for its home port in Virginia. The Navy 
is very concerned that the insufficient depth of the Kennebec 
River could cause that destroyer to run aground, and the Navy 
has said that the condition of the river constitutes an 
emergency and that it must be addressed in order to meet the 
scheduled delivery of this military asset. So this is truly a 
real challenge that is worrying to Bath Iron Works and to its 
customer, the Navy.
    I understand that the cost estimate to complete the 
dredging is $1.6 million.
    Complicating the issue, the timing of the dredging is very 
important to the lobster and clamming industries in Maine whose 
peak season is during the summer months, in the month of 
August.
    In fiscal year 2006, it is my understanding that $630,000 
was allocated for dredging activities on the Kennebec, but that 
that money, to my knowledge, has not yet been used for that 
purpose. Obviously, the ability of ships to enter and depart 
Bath Iron Works is of vital importance to our national 
security.
    So I have two questions for you. One, do you expect a 
resolution of this issue in time for the scheduled departure of 
the Navy destroyer that is slated to depart in October? And 
second, is COE working with the local lobster men and clammers 
to minimize the impact on their livelihoods?
    Ms. Darcy. Senator, yesterday I spoke with the Assistant 
Secretary of the Navy on this very issue, and we realize it is 
of vital importance not only to the Navy, but to our national 
security in order to have that ship delivered on time to 
Norfolk. I believe its schedule is September 1 of this year. We 
committed, along with the Assistant Secretary, to work together 
to find the money to get the dredging completed.
    That said, in order to meet the September 1 deadline, we 
have a couple of challenges which you mentioned which include 
the clamming and the lobstering which the peak season is 
August, and it is in August when we would have to dredge. Our 
normal dredging schedule up there is usually between November 
and March. So we are sort of in a bind here.
    We would have to get permits and work with the fishermen 
and lobstermen in order to get a schedule that works for them.
    Senator Collins. I hope that you will work very closely 
with all of the parties, BIW, the Navy, the lobstermen, the 
clammers. It is too bad this was not done this past winter when 
there would not be the impact on the fishing industry and the 
lobstermen and clammers. We also need to accommodate Bath Iron 
Works.
    I know my time has expired. Let me just very quickly say 
that COE met in Maine yesterday concerning the jetty at Camp 
Ellis in Saco, Maine. This is more than 100 years old. It was 
built by COE before there was an understanding of the erosion 
impact of having this jetty. That is another issue that has 
been going on for a long time. Each year I visit and see more 
and more danger to the homes along the shoreline, and I hope we 
can continue to work on that as well. We provided funding and 
there has been some progress, but we have got a long ways to 
go.
    Senator Feinstein. Thank you, Senator Collins.
    Senator Collins. Thank you.
    Senator Feinstein. Senator Graham, you missed your time, 
but I know you are lively and a little spirit every now and 
then would not hurt.
    Senator Collins. And I am boring.
    Senator Graham. No, you are not boring. You are just from 
Maine.
    Senator Graham. You are polite and kind.
    Senator Collins. I will leave it at that then.
    Senator Graham. Yes.
    I was over nominating a judge for the Fourth Circuit, and I 
may be the only guy in the history of the Senate to nominate a 
judge and put a hold on him all at the same time. So it has 
been a strange weekend.
    Secretary Darcy, the Panama Canal is going to be deepened 
in 2014. Is that correct?
    Ms. Darcy. That is the plan, yes, Sir.
    Senator Graham. The plan is to deepen the Panama Canal so 
that super cargo ships can pass through the canal. Is that 
correct?
    Ms. Darcy. Yes.
    Senator Graham. These are ships a lot bigger than we have 
today.
    Ms. Darcy. Many of them will be, yes, Sir.
    Senator Graham. It is going to change shipping as we know 
it.
    Ms. Darcy. I anticipate that.

               COE deg.FUNDING HARBOR DEEPENING

    Senator Graham. So there are certain ports that are in 
existence today that are going to have to adjust their depth to 
accept these ships. Is that correct?
    Ms. Darcy. Yes.
    Senator Graham. One of them is Charleston.
    Ms. Darcy. Yes.
    Senator Graham. I think everybody realizes that. But it is 
just not Charleston. And if shipping is going to change and we 
are going to meet President Obama's goal of doubling exports in 
5 years, which is a great goal, we better have the 
infrastructure to make that a reality.
    So, Madam Chairman, you, your staff, Senator Alexander have 
been absolutely terrific and helpful. We have got a dilemma. In 
the 2011 budget, there was no money set aside by the 
administration to conduct a study, and as I understand the way 
you deepen a port, there are three phases: the study phase, the 
design phase, and the construction phase. Is that correct?
    Ms. Darcy. Yes.
    Senator Graham. And the Congress has to authorize these 
studies for you to move forward. You just cannot do this on 
your own. Is that correct?
    Ms. Darcy. Yes.
    Senator Graham. So what we have tried to do is find a way 
to allow the study in 2011 to go forward. And it is a 3-year 
process where the study goes on for 3 years, and after the 
study is done, the design phase kicks in. That is about $25 
million to $30 million, and the construction to deepen the 
harbor to 50 feet, what we anticipate would be the depth to 
receive these ships, is several years, about $350 million. And 
there is a cost-sharing agreement between ports and the Federal 
Government. Is that correct?
    Ms. Darcy. Yes.
    Senator Graham. So my dilemma is that I have no vehicle to 
allow the study in 2011 to go forward. It is a scoping study. 
It is about $40,000 on the Federal side. The port in South 
Carolina is willing to pay the Federal Government's share, but 
we literally cannot. So everybody on this subcommittee has been 
helping me, and I am talking to the administration about a way 
forward.
    But beyond Charleston, do we have a vision as a Nation as 
to what ports should be deepened to accept these ships? And is 
there a financing plan in place?
    Ms. Darcy. No, Senator, we have not done a nationwide study 
to evaluate which ports should be deeper.
    Senator Graham. I would like to recommend to this 
subcommittee this would be a good use of our time to look as a 
Nation what does it mean for these ships to come through the 
Panama Canal, what does it mean to traffic on the Mississippi 
River, and try to make a good business decision.
    I am willing, Madam Chairman, to allow COE to decide 
whether or not to spend money on Charleston's deepening if it 
makes sense from a national perspective. But since that system 
is not in place, I have to protect Charleston. And as you 
mentioned, there is a lot of money not being utilized. So we 
need to look at that account.
    But, Secretary Darcy, could you propose to this 
subcommittee a plan, General, that would allow you to make an 
assessment of what ports need to be deepened based on the 
Panama Canal situation? Have you all done anything along those 
lines? Would you be willing to submit a plan to us if I ask 
you?
    Ms. Darcy. We would have to be directed and funded to do 
so, Senator.
    Senator Graham. That funding problem.
    I would just ask the subcommittee to look into this 
situation because as a Nation we do not have the infrastructure 
to basically accept ships that are going to be the standard for 
the future, and if President Obama's goal of doubling export is 
to be achieved, as Senator Alexander said, shipping is the key 
way to get goods throughout the world.
    In South Carolina, BMW makes cars. We call it ``Bubba Makes 
Wheels.'' But there is a BMW plant in Greenville/Spartanburg, 
South Carolina where we have shipped more than $4 billion worth 
of cars made in South Carolina throughout the world. And the 
port in Charleston is responsible for 1 in 5 jobs in South 
Carolina. I bet you that is true in places in California. I 
know it is true in Mississippi and Alabama.
    So let us look at what we should be doing as a Nation, 
General, and make a business decision. I am willing to let 
merit take over if we are all in the same boat together. So I 
will end this discussion with the idea of please, for God's 
sakes, help me find a way to do the scoping study in 2011, and 
we will look at a system-wide approach beyond that.
    General, do you have anything to say?
    General Van Antwerp. Yes, Sir, if I could just respond 
quickly.
    We have six ports that are moving to the 50-foot depth. 
That is what you will need to come fully loaded through the new 
Panama Canal. We also have seven studies of deep water ports, 
which Charleston is if we get the feasibility dollars to do it, 
that have potential. With Charleston being 45 feet now, what 
would it take to go to 50? What is the benefit-cost ratio? We 
do have a lot of knowledge of how the ports are intertwined 
because you may not have to come in full from the Panama Canal 
if you have already offloaded some to go to the next port, the 
next port. So it is a system, and we can take that on if funded 
to do so.
    Senator Feinstein. Thank you.
    Let me say this because I spoke to Senator Alexander. We 
will put report language in our bill to indicate very strongly 
our view which is that we do not believe money should be taken 
from this trust fund for other use. All anyone has to do is go 
to the Port of Hong Kong, go to any other major port to see how 
out-of-date our ports are. If we are going to compete 
internationally, we have to have a modern infrastructure, and 
the ports have to be consistently dredged.
    So I think we will have some very strong language in our 
bill, and I want to say to the administration I will do 
everything I can to prevent that trust fund from being eroded 
with other activities.
    Next is Senator Reed.
    Senator Reed. Thank you very much, Madam Chairman.
    I want to welcome all the witnesses. I particularly want to 
welcome General Van Antwerp, Bob, thank you for your 
extraordinary service--you and your family--to the Army and to 
the Nation. Although the General looks much younger than I, we 
were contemporaries at West Point. So it is good to see you. 
Clearly his talent was recognized early on at West Point. I am 
in another line of business and that speaks for itself.
    Now, let me continue. I want to thank you, both Secretary 
Darcy and General Van Antwerp, for the extraordinary response 
of COE of Engineers to the floods last year in Rhode Island. 
Your New England district personnel were incredibly active, 
hands-on, great initiative. They were particularly helpful in 
prioritizing dredging at the Patuxent Cove which would now 
allow for freer access of water from our systems into 
Narragansett Bay. And they have conducted reconnaissance 
studies. They have taken really this issue on. So can you 
accept my compliments and pass them on to those extraordinary 
public servants? Thank you.

            COE deg.CONTINUING AUTHORITIES PROGRAM

    Let me focus on a series of issues, Secretary Darcy, the 
continuing authorities programs. I found them to be very 
useful, particularly the 205 Continuing Authorities Program 
(CAP), one of the programs that deal with flood control. And I 
have noticed that in the President's budget, there is the 
proposed elimination of four existing CAP's, and then the 
reliance on transferring funds to fulfill the obligations of 
some other CAP's.
    Can you comment on the CAP activities, the proposed 
changes, and how would it affect flood control?
    Ms. Darcy. Senator, you are correct. We did make a proposal 
in this budget to use some of the existing funds in the 
carryover programs from one CAP program to another. I think it 
is $23 million. We are going to use that carryover money for 
other programs. And in looking at tough budget decisions and 
directions from the Office of Management and Budget, we had to 
make some choices, and we looked at the CAP programs.
    The 205 program is one that is going to continue to be 
funded with carryover funds in this budget. CAP programs are 
smaller projects that do not need individual authorization or 
Chief's Reports, and there are certain thresholds as to how 
much Federal funding can be spent on those. They have been very 
effective especially in small States like Rhode Island. We will 
continue to fund those in this President's budget, but some of 
the others, like the small harbors money, are going to be cut. 
We are going to continue to fund those programs and they are 
prioritized within the region.
    Senator Reed. Well, I appreciate that with respect to the 
205 program.
    One of the other programs is the 103 CAP which does a lot 
with respect to coastal erosion, and we just had a recent 
report that 68 percent of the beaches in New England and the 
mid-Atlantic, basically the whole northeast coast, are eroding 
on an average of 1.6 feet a year. And in towns in Rhode 
Island--and this reminds me of a great story. Senator Theodore 
Francis Green was asked the size of Rhode Island. He said it 
depends, on what, and he responded, high tide or low tide.
    So 1.6 feet a year is an important metric to us, and that 
103 program I believe is one that is scheduled for elimination. 
So it begs the question how do we deal with this multi-State 
erosion problem along our beaches.
    Ms. Darcy. I think it needs to be looked at as a system, as 
you said, with each of the beaches. We have money in the budget 
for beach renourishment projects. It is something that we are 
carefully considering when we make the budget proposals.
    Senator Reed. Thank you very much.
    Madam Chairman, thank you.
    And once again, thank you for your great assistance in our 
flooding. Thank you.
    Senator Feinstein. Thank you very much, Senator Reed.
    Senator Lautenberg.
    Senator Lautenberg. Thanks very much, Madam Chairman.
    I listened with interest to your response to questions. I 
must say you are staying up-to-date and I wish that you had 
more money to stay up-to-date more with. But the fact of the 
matter is that we in New Jersey have lots of respect, but also 
need, if I might say, from COE.

                  COE deg.PASSAIC RIVER BASIN

    By the way, General Van Antwerp, I spent part of my 
military career in Antwerp, Belgium during the war, and I 
always had a good feeling about that city and we have about you 
as well.
    Last month, I toured the Passaic River basin in New Jersey 
following a severe storm and saw the devastation firsthand. 
There is a dispute here between the communities. Local 
communities in that area believe that flood gates at the 
Pompton Lakes Dam have led to increased flooding in downstream 
communities. And an independent consultant has been brought in 
and is investigating the matter. I was there during the heavy 
stage of the flood, and the communities downstream were deeply 
in trouble because of the flooding.
    What has COE done to address this issue? Will it take in 
local concerns as the study moves forward?
    General Van Antwerp. Absolutely, Senator, we will take 
those local concerns into account. We want total visibility on 
this. We welcome the other review of this also.
    Senator Lautenberg. I hope so because something does not 
work, as is visible, when it is heavy weather.
    Secretary Darcy, I am encouraged by the close cooperation 
between COE and the New Jersey Department of Environmental 
Protection to try to work toward a comprehensive plan for the 
Passaic River basin. However, the re-evaluation study is 
expected to cost COE $7.5 million over the next 3 to 5 years. 
Is COE committed to requesting funding for this project in the 
future years?
    Ms. Darcy. Senator, we have not included money for it in 
the fiscal year 2012 budget.
    Senator Lautenberg. Well, we are going to need your support 
in getting this study done. The Passaic River has been a place 
with constant flooding and problems that result from that.
    I was pleased to see that your budget request included 
funding for the Port Monmouth beach project in New Jersey. In 
the past, coastal projects have typically been added as 
earmarks during the appropriations process rather than being in 
the budget request. Well, with earmarks on their way--they are 
at a moratorium now--how does COE plan to address the need for 
coastal storm damage reduction projects as it writes a work 
plan for the rest of this year and looks ahead to future 
requests? How do we get it done?
    Ms. Darcy. As far as the work plan that we will be required 
to write for the rest of this year, we will look to fund 
projects that are currently in the budget and then, with any 
remaining funds, look to prioritize other ongoing work.
    Senator Lautenberg. I have a couple of other questions that 
I want to submit for the record.
    But I want to ask you this. When I look at the budget that 
is requested for 2011, I see that there has been less money 
requested for fiscal year 2012 than we actually had with fiscal 
year 2011. I do not want to put you on the spot, but I do not 
think that is because there is less need. I do not know whether 
you are at liberty to say whether or not more is needed than we 
have presently allocated for the projects that you have 
requested or are underway.
    Ms. Darcy. Senator, we are operating within the fiscal 
climate that we are in, and this budget is what the President 
believes will allow us to sustain our missions.
    Senator Lautenberg. Thank you very much.
    Senator Feinstein. Thank you very much, Senator Lautenberg.
    Senator Murkowski.
    Senator Murkowski. Thank you, Madam Chair.
    And thank you to those who are appearing before us today, 
for your testimony, for your work. We appreciate it.

                   COE deg.FUNDING DECISIONS

    Clearly a great deal of interest in this, Madam Chairman, 
ranking member. I think it is not just because you are such 
wonderful leaders here on this subcommittee, but I think it 
speaks to the issue of what we are dealing with and the 
significance of not only ports and harbors, but our reality 
that in this new world of no earmarks, how we are able to help 
advance those projects, whether it is as Senator Graham has 
indicated, whether it is as Senator Lautenberg has indicated, 
or whether it is as it relates to the small harbors issues, as 
I will bring up. These are very critical issues for us, and I 
think we recognize the investments to our communities that are 
made when COE does the job that we ask them to do.
    Secretary Darcy, the question that I have for you--a series 
of questions here. We know that in recent years at least, we 
have seen the Congress increase the amount of funding for the 
construction of ports and harbors above the President's 
request. That was true in fiscal year 2010. In total, the 
Congress funded 350 studies and projects. The President had 
budgeted for 153. Now in fiscal year 2012, COE is budgeted for 
149 projects, and as I mentioned, we are operating under this 
earmark moratoria.
    The question that begs here is under this budget what 
happens to the 350-some-odd projects that were earmarked by the 
Congress in fiscal year 2010, and then going beyond there, what 
are the consequences for the local sponsors who have provided 
the matching funds from the municipal bonds or from the State 
funds? Where are we at this point in time with these projects 
that the Congress had said these are important, we need you to 
advance? Where are we now?
    Ms. Darcy. Senator, in making our budget priorities, we 
look at the benefits to the Nation of all of these projects, 
and that is how they compete and that is how we will budget for 
them.
    Senator Murkowski. Well, I appreciate benefits to the 
Nation. We think that in Alaska we have a lot of benefits to 
the Nation. I know that Senator Collins feels that her ports 
and harbors have a lot of benefit to the Nation as well. But 
you are going to have 26 States, including Alaska, that are 
budgeted for O&M money, operation and maintenance money, in 
fiscal year 2012, but who will receive no funding for general 
construction because of these low cost-benefit ratios. And as 
you go around the dais here and look to the States that we 
represent--Alaska, Alabama, Mississippi, Hawaii, South Dakota, 
Iowa, Montana, Kentucky, Maine, and South Carolina--would not 
receive any construction funding.
    So what do we say, that these 26 States are not significant 
or important to the national interest? We have had 
conversations about how the smaller harbors may be a lower 
priority from a national perspective, but in terms of what they 
contribute to a regional economy, they are extraordinarily 
important. So we have got a system where we have a cost-benefit 
ratio system that will never allow many of these States to ever 
get into the funding stream when it comes to general 
construction.
    So if we do not have earmarks, what can the Congress do to 
ensure that these States that are not budgeted for construction 
can somehow or other continue to get funding? Because I will 
not accept the conclusion that 26 States, including Alaska, 
will just not see general construction money. That is not 
right.
    Ms. Darcy. Senator, we do not do our budgeting on a State-
by-State basis.
    Senator Murkowski. I understand that.
    Ms. Darcy. We do it on a project-by-project basis. That is 
where the prioritization and the value come in.
    As far as what can be done in the nonearmark era, there are 
any number of ways to look at a budget, whether it is a 
systems-based budget or a line item-based budget. That is 
something that the Congress may need to look at.
    Senator Murkowski. I think the Congress needs to look at 
it. I think we need to work with COE because I think this has 
led us to a result that whether you are from Alaska and trying 
to get a small harbor going or Senator Graham from South 
Carolina that is trying to get Charleston advancing--we have 
got ourselves in a bit of a mess here. And I am looking for 
your suggestions as to how we resolve it because just going to 
old rhetoric, which we operate off of this cost-benefit ratio 
and that is the standard and that is the way it is, is not 
acceptable.
    General, do you have comment you would like to make?
    General Van Antwerp. Yes, Senator. First of all, we would 
love to work with you on the priorities. I think if there are 
no earmarks, then we go back to the priority scheme. So we 
could work together on how the priorities are set, and maybe it 
is different than we do right now. Right now it is very heavily 
weighted to the National Economic Development benefits, and so 
that is your benefit to cost ratio that you have been speaking 
of. I think there are ways to look at the priorities of the 
whole system where portions of it could be reallocated based on 
a certain set of priorities that were set.
    Senator Murkowski. Well, I appreciate that. I think that is 
something that we need to do and look forward to working with 
you as well as those of us here in the Congress.
    I do have a series of questions regarding CD-5 and the 
failure by COE to be able to proceed with the bridge over the 
Colville River. I recognize that I am over my limit, though, 
but I would like to pose a series of questions to you for a 
response.
    Thank you, Madam Chair.
    Senator Feinstein. Thank you very much, Senator Murkowski.
    Senator Harkin.
    Senator Harkin. Thank you, Madam Chair. Thank you very 
much, Ranking Member Alexander.

                  COE deg.LEVEE CERTIFICATION

    Secretary Darcy, across the country, a number of cities are 
facing decertification of their levees as a result of higher 
estimated water flows, one of those cities being the capital 
city of Iowa, Des Moines. In the Des Moines case, the loss from 
a 100-year flood is very likely to be well more than $1 
billion. And that does not count the considerable loss of new 
construction and economic development that will occur with 
decertification. In other words, if they decertify the levees, 
there are big areas that are now being opened up with new 
expressways and areas for economic development. That will 
probably come to a screeching, grinding halt if these levees 
are decertified.
    Now, the city of Des Moines and other cities I am aware of 
across the country cannot afford to wait over a decade for 
studies and remediation. In Des Moines' case, the possible 
solutions are complex, including possible modification of COE 
dams, the raising of bridges, the widening of streams, the 
raising of levees. Each year of delay is a significant loss in 
economic development and jobs, higher flood insurance costs and 
again also possible flood damage. We really need COE to move 
forward with these complicated studies in Des Moines which I am 
told and understand is within your existing authorities.
    COE has unique and needed capabilities. That should include 
allowing the local sponsor, for example, to contribute funding 
up front with the understanding that if a project develops, 
those advances would be appropriately counted as a match. 
Again, so we do not lose crucial time, we are trying to get up-
front money which the city of Des Moines is willing to do in 
order to collapse that timeframe, but again those monies then 
would count as part of their match so they do not lose this 
whole timeframe.
    So I hope that you will support having these studies move 
forward as efficiently and quickly as possible and, as we wait 
for regular funding, that you do all you can to approve the use 
of city-advanced funds, which I was just talking about, with 
the agreement that those local funds would count as a match 
against approved activities that would come on later on.
    Can you respond to that statement, because I have been 
meeting with the people in Des Moines. They are at a critical 
juncture right now. If we do not get something done within the 
next about 18 months, we are facing some real economic problems 
in the city of Des Moines. So, again, my question is, in your 
jurisdiction could we get the city of Des Moines to advance 
those funds, get those studies collapsed, do it in a hurry, 
while we wait for regular funding?
    Ms. Darcy. Senator, if we have a written agreement with the 
local sponsor and COE, it is my understanding that we can 
accept up-front money and provide further credit.
    Senator Harkin. You could if there is an agreed plan.
    Ms. Darcy. Yes, at the beginning.
    Senator Harkin. With the city of Des Moines.
    Ms. Darcy. Yes, with the local sponsor.
    Senator Harkin. If the city of Des Moines comes up with 
that, how long do you think it would take to get that approved? 
I mean is this something we could look at in a very short 
timeframe?
    Ms. Darcy. I believe so, Senator.

                  COE deg.CEDAR RAPIDS, IOWA

    Senator Harkin. Okay, that is good. That is very good.
    Well, okay, we have one other city in Iowa that is on a 
river and it gets flooded. It is called Cedar Rapids. You know 
that very well. And first of all, I commend COE for its rapid 
movement of the Chief's report on Cedar Rapids. It has been 
very good, General. But as you know, the findings propose a 
project based on traditional criteria. I know you are probably 
aware of this. It is one side of the river. General, you know 
that very well. The other side of the river, more than 3,000 
homes, and would you not know it, these are families with lower 
incomes than those that are on the side to be protected. So it 
is always those with lower incomes--they do not get any help.
    I think the philosophy of the December 2009 proposed 
national objectives, principles, and standards for related 
resources should be followed in a case like this. The Cedar 
Rapids waiver request will soon come to you to provide 
protection on both sides of the river. I urge you to grant it. 
That is the correct position on an equity and environmental 
justice basis. Cedar Rapids is a major engine for the economy 
of all of eastern Iowa, and it will be severely damaged with 
the lack of investments without a project on both sides of the 
river.
    I also hope that you will support allowing Cedar Rapids to 
count all of a sponsor's traditional costs that it incurred 
since the date of the flood.
    So that waiver request will be coming to you soon.

          COE deg.UPPER MISSISSIPPI RIVER NAVIGATION

    Last, Madam Secretary and General, I want to talk a little 
bit about the upper Mississippi navigation. We spent and I 
spent 20 years working to get this final plan approved for the 
upgrading of the locks and dams on the upper Mississippi. We 
finally got it done. And now I am worried about the ability to 
move ahead, both to maintain and move forward on the 
improvements in that navigation system.
    Of course, I was disappointed with the level of support in 
the fiscal year 2012 budget proposal from the White House, and 
I think it is clear that the budget agreement that we are 
probably going to agree on is going to put some real strains on 
the ability of COE to move forward. Madam Chair, I will be 
submitting some questions for the record in this regard.
    My point is this. I think that there is a need to increase 
funding available the Inland Waterways Trust Fund. I was 
pleased with the National User Board's proposal which 
recognized that need but also called for both more efficient 
processes regarding navigation construction and the reworking 
of the definitions of what is considered navigation. I can tell 
you that behind every dam--well, I cannot say ``every''. I have 
not visited them all. Behind most of them are great 
recreational areas, a lot of fishing. Even in some of the 
places down the Mississippi, you would be amazed how many 
people go out there just to bird watch and watch the bald 
eagles.
    Have you watched that Web site, the Decorah Eagles, by any 
chance? No. There is a Web site. It is called Decorah, D-e-c-o-
r-a-h. You have been there a lot of times, but it is called 
Decorah Eagles. What they did, Madam Chair, someone--not 
someone--an entity, an environmental group, set up a web camera 
in a tree focusing on an eagle's nest.
    Senator Feinstein. I saw it. It was wonderful.
    Senator Harkin. Is that not wonderful?
    Senator Feinstein. Yes, and the baby.
    Senator Harkin. And the little baby is being hatched and 
all that and everything.
    Senator Feinstein. It is great.
    Senator Harkin. Hundreds of thousands of people around the 
world watching it.
    Well, along the Mississippi River, people are doing that. 
They are going out watching birds. There is a lot of recreation 
taking place.
    It seems to me that it should not all be counted as 
navigation. It should be counted both as recreation and as 
navigation.
    And we ought to allow for an increase in the taxes that 
even the barge people say they want to do but they want to make 
sure that it is used for navigation and to make sure that the 
recreational uses behind those dams and stuff are funded as 
recreational uses and not as navigational uses.
    So I just wanted to say that. Like I said, rather than 
getting into it here, I will submit for the record a number of 
questions.
    But I just want to thank you very much, Madam Secretary, 
and General, thank you so much for all you have done. Cedar 
Rapids--you have been great in response and helping us out 
there. Believe me I know the constrictions on that other side 
of the river. I understand that. I am just trying to see what 
is equitable and what could possibly be done to help a 
situation that cries out for some kind of justice here. So 
however we can work that out, I would sure appreciate it. Thank 
you both very much.
    Thank you, Madam Chair.
    Senator Feinstein. Thank you very much, Senator Harkin.
    To our witnesses, you have had 10 percent of the Senate 
here today, 10 people. That is very unusual for a subcommittee 
meeting, and I hope you interpret it as compliment and I hope 
you interpret it as the interest with which we hold your areas 
of expertise.

                      COE deg.DAM SAFETY

    I have a couple more questions. One is on dam safety, 
before I turn to BOR who has been sitting there so quietly, I 
want to say a couple of things.
    There is a 90 percent chance in California that within the 
next 30 years, we have a major earthquake. It is not a chance. 
It is a probability. We are in the Ring of Fire. We have seen 
the Ring of Fire with huge earthquakes in South America, Banda 
Aceh, Christ Church, New Zealand, and all the way up. So there 
is a lot of reason to be concerned.
    We have in California three dams--I do not know, but the 
words I have been given are ``most at-risk'' category, whatever 
that means. One, Lake Isabella, has been under study for 6 
years.
    Now, the first question is what qualifies a dam for the 
``most at-risk'' category, General.
    General Van Antwerp. Senator, we look at a number of 
factors. Probably the most damaging factor would be whether 
there is material coming through the foundation of that dam. We 
call that piping in the engineer world. And most of the DSAC-1 
dams, which is the category you were mentioning, where it is 
urgent and compelling that we fix them now, have that problem. 
They are bringing material through the foundation. So we know 
there is erosion taking place. That is the most critical 
factor.
    We have a number of those under rehabilitation right now as 
we speak.
    Senator Feinstein. Well, how long do you have to study 
them, 6 years for Lake Isabella?
    General Van Antwerp. Lake Isabella--we have looked very 
closely at that. As we look at it, we think we are going to be 
fine with that if we stay on the schedule we are on.
    Senator Feinstein. Which is what?
    General Van Antwerp. The schedule right now is that we are 
going to fund that at $7 million in fiscal year 2012, which is 
the capability. We have a wedge of funding that is not totally 
visible to you all for dam safety. We are funding that project 
to continue on the schedule and we will make the repairs 
necessary when they come. We have $7 million in fiscal year 
2012 for that.
    Senator Feinstein. How about the other two most at-risk 
dams?
    General Van Antwerp. The Success Dam is budgeted with $18 
million in fiscal year 2012, so that one is also on schedule. 
What we are going to do there is acquire properties and we are 
on track with the $18 million. I think on both of those dams, 
we definitely have our eye on them and we are aware of their 
condition.
    Senator Feinstein. And the third one?
    General Van Antwerp. The third one. Which one is that?
    Senator Feinstein. I am trying to remember which one it is 
and I cannot remember.
    General Van Antwerp. Martis Creek. We have our eyes on that 
too. This is Mr. Steve Stockton who is our Director of Civil 
Works. He knows these in and out.
    Senator Feinstein. And so, on that one?
    General Van Antwerp. I am not exactly sure. I do not have 
the notes on where we are.
    Senator Feinstein. Would you let me know, please, because, 
obviously, I am vitally concerned.
    General Van Antwerp. Right.
    Senator Feinstein. Now, let me turn to BOR.
    You have proposed a new account for Indian water rights 
settlements. The question is how much mandatory funding 
accompanies the $51.5 million discretionary funding you have 
proposed for fiscal year 2012?
    Mr. Connor. The $51.5 million was basically designed to 
meet the capabilities that we have for 2012 with respect to the 
four new settlements. And what we are trying to do there, 
although there is a significant amount of mandatory funds being 
made available for those four new settlements, they also 
include a substantial amount of associated appropriations 
needs. I think to the tune of about $700 million was provided 
in mandatory funding, but with respect to BOR, we will still, 
for these four new settlements, about $250 million in 
discretionary appropriations is needed. So what we have tried 
do is to try and get the appropriations process going to cover 
that need.
    With respect to the new account, we have also incorporated 
the Navajo-Gallup pipeline project in New Mexico, the Navajo 
settlement in the San Juan River basin. There are about $25 
million in that account, I think we are going to ramp up to a 
capability in 2012 on the Navajo project to something around 
$70 million to $80 million. So there is a substantial ramp-up 
that is going on in that project itself, and so it will be a 
combination of those appropriated dollars, the $25 million, in 
the new account, plus we have been provided mandatory funds of 
$60 million in the Claims Resolution Act of 2010.
    Senator Feinstein. Do these settlement agreements require 
funding annually?
    Mr. Connor. They do not necessarily require specific 
funding annually. Some of them do. For instance, the Crow 
settlement contemplates an immediate distribution of $4 million 
I believe.
    Senator Feinstein. Are they all water systems?
    Mr. Connor. They are a combination of trust funds, which 
will come out of BIA accounts and infrastructure which are 
primarily designated for BOR. So we have municipal and 
industrial (M&I) systems, drinking water systems, but we also 
have some rehabilitation of existing irrigation systems that 
are part of the projects.
    Senator Feinstein. So you believe they can be funded 
without taking the money from anywhere else.
    Mr. Connor. Right now, through the new account, plus the 
combination of mandatory funds that we have, for the next few 
years we think we can manage that situation. But once again, 
overall, we are still looking at $250 million plus another $500 
million for Navajo. We are looking at, through appropriated 
dollars over the next decade, about $750 million worth of 
appropriated dollars that we have got to find somewhere.
    Senator Feinstein. I want to thank you for your sensitivity 
to the South-of-Delta water issues. I was very pleased to learn 
that BOR has increased the allocation for farmers from 65 
percent to 75 percent last week. I know these followed two 
previous rounds of increases. However, as you know well, there 
is still a lot of consternation in the central valley when most 
other projects are receiving 100 percent, and we have got a 
bumper crop of water and it is still the South-of-Delta that 
does not have 100 percent.
    In your judgment, how close to 100 percent can this region 
get with all the water that is now available?
    Mr. Connor. Well, there is still a chance to get up to that 
100 percent level. I would like to provide some perspective, 
though. Since 1990, we have only hit that 100 percent level 
South-of-Delta three times. The average over that 20-year 
period is 62 percent to South-of-Delta allocation for 
agriculture.
    Senator Feinstein. I actually got out the contracts and 
read them, and it is interesting because they are contracts 
with all kinds of hedges in them because generally when 
somebody signs a contract, you expect to be bound by the terms 
of the contract. In this case, the Government is not really 
bound by 100 percent water allocation under the contract. I do 
not know that people know that, and I think it is very hard. 
And I think when farmers look around and they see other water 
districts with 100 percent, it becomes even harder. And I 
understand there are special exigencies for the South-of-Delta, 
but try and sell that. It is unsalable, and I think you know 
that.
    Mr. Connor. Yes, absolutely. There are priorities. There 
are water rights conditions and the new environmental 
obligations that we have. All of those factors have affected 
that South-of-Delta allocation. But you are right. The 
expectations are there because of the contract quantities, and 
notwithstanding the fact those 20 years of experience show us 
that there is not enough water to consistently meet that 100 
percent need, there is still an expectation out there, 
particularly this year when the snowpack and precipitation is 
160 percent of average statewide.
    Senator Feinstein. Well, I know you are sensitive, and you 
have been just great and it is very much appreciated. I know 
how tough it is. Whatever we do, it is not enough, but at least 
we are trying. So thank you.
    Perhaps the biggest effort in California is the Bay-Delta 
conservation plan and what might come from it in the 10- to 15-
year build period after. Can you provide an update on BOR's 
efforts to develop a programmatic EIS for the Bay-Delta 
conservation plan?
    Mr. Connor. Yes, Senator. Over the last 4 or 5 months, 
there has been a very concerted effort by BOR, in concert with 
the other Federal regulatory agencies, Fish and Wildlife 
Service and NOAA Fisheries, working with the California Fish 
and Game and the Department of Water Resources. We are calling 
it the ``five agency process''. And we have been led in that 
effort by Deputy Secretary David Hayes. And I think we have 
made a remarkable amount of progress in dealing with six major 
issues that are key to working through so that the State of 
California, which is going to be the permittee under the Bay-
Delta Conservation Plan process, can go in and submit their 
plan with a reasonable expectation that we can work through 
those issues and get to a final permit. It is not pre-
decisional. The regulatory agencies have made that very clear. 
But we are trying to get enough in the area so that there is a 
reasonable expectation of success.
    We have resolved, I think, four of the six issues. We are 
working very hard over the next couple of months to resolve the 
last two, and hopefully beginning mid-summer, the State will be 
in a position to submit its plan which will kick off the 
Environmental Impact Statement/Environmental Impact Report 
process. A lot of the analysis is already being done waiting 
for the final plan to come in. I think there is still hope that 
within a year's time period, that there will be a draft on the 
street.
    Senator Feinstein. Another problem. Since 2007, quagga 
mussels have been inundating the Colorado River system. They 
were found within Lake Mead, and since then, everybody has been 
working to prevent them. I met with the metropolitan water 
district the other day. They were telling me how they had spent 
millions of dollars and these things are just in gobs along 
their lines. Each quagga reproduces a million mussels a year. 
You cannot kill them with cold water. They have to go in and 
scrape feet of quagga mussels piled up. And if it infiltrates 
the water system, we have really got a problem.
    How much activity within BOR is going on to really try to 
combat this mussel issue, because it is a huge one? The Met 
just e-mailed the staff. They spent $28 million total scraping 
these things off the pipes.
    Mr. Connor. Yes. It is quite a problem and unfortunately, 
it is one that is spreading. And that is where our initial 
actions are right now. Our initial actions are to work very 
closely with the State agencies in trying to educate the public 
about the potential for transferring quagga mussels between 
bodies. Right now, we used, I think, around $5 million of our 
Recovery Act money just to do a broad survey west-wide of our 
various facilities to try and get a grasp on the scope of the 
problem, trying to educate people so that the problem does not 
increase.
    With respect to actually dealing with them in the 
facilities that they are in, most of our activity has been 
related to research and development activity. We are trying to 
kill them through various means. We are trying to develop 
coatings that will maybe keep them off the infrastructure.
    Senator Feinstein. You mean by getting them high, Codeine?
    Mr. Connor. No, coating--C-O-A-T.
    Senator Feinstein. Oh, I thought you said codeine.
    Mr. Connor. It took me a second. I think that is good that 
I did not immediately react, coating.
    Senator Feinstein. Got it.
    Mr. Connor. That will hopefully inform us about how we can 
keep them off of some of the infrastructure. But they are 
already there, and as Metropolitan Water District (of Southern 
California) well knows, they are investing a lot of their 
operation and maintenance funds right now just to try and 
control the problem.
    Senator Feinstein. Well, thanks to Senator Alexander and 
our work on Interior, Lake Tahoe, which we are trying to do 
some work on and save, which is one of two last remaining clear 
water lakes, huge lakes, is beginning to be infiltrated. So 
there is a boat boycott, and every boat prior to going into 
Lake Tahoe has to be specially inspected and washed.
    So I do not know if you can come up with any of the things 
that can be done. They have to get in somewhere, and we have 
got to prevent them from getting in. I mean, with a lake that 
is relatively isolated, if these are carried like from Lake 
Mead on the bottom of a boat to Lake Tahoe, you can clean the 
boat. But we really need some help and Federal suggestions of 
what can be done because they are really going to destroy not 
only the Colorado water supply system, but also our Great 
Lakes.
    Mr. Connor. Right. I agree. I think the inspection 
stations, the education process, everything we are 
participating in with our State partners in that effort, but it 
is a growing problem that we need to pay more attention to.
    Senator Feinstein. Thank you very much.
    Senator Alexander.
    Senator Alexander. No thank you, Madam Chair.
    Senator Feinstein. No, thank you, you said, all right.
    Well, let me thank everybody. Let me particularly thank our 
witnesses. I think this was a very useful hearing. As Senator 
Alexander whispered to me, I am glad I am up here, not down 
there.
    At this time I would like to ask the subcommittee members 
to please submit any questions that they have for the record.

    COE deg.BOR deg.ADDITIONAL COMMITTEE QUESTIONS

    [The following questions were not asked at the hearing, but 
were submitted to the Department for response subsequent to the 
hearing:]
                 Questions Submitted to Jo-Ellen Darcy
               Question Submitted by Senator Patty Murray

    Question. Assistant Secretary Darcy, I appreciate all you have done 
in your time with the Corps of Engineers (COE) and the good work of the 
districts that serve my home State of Washington. We are obviously 
facing very difficult budget times and unfortunately, the President's 
budget request reflects that for COE. Yet even as we face these hard 
times, COE has ongoing General Investigations that are routinely not 
included in the President's budget request, like the Elliott Bay 
Seawall GI or the Skagit River GI. Can you tell me how you plan to 
continue these important projects?
    Answer. All projects and studies are evaluated and considered for 
funding. However, only the highest-priority studies from a national 
perspective are proposed for funding. The Army has undertaken a broad 
effort to review the scope of active studies to ensure resources are 
appropriately aligned to complete those studies most likely to result 
in a high-performing project. For example, as part of this effort, the 
Skagit River study will be reviewed this year.
    The Army is working to finalize implementation guidance for section 
4096 of the Water Resources Development Act of 2007, which includes the 
determination of the feasibility of reducing future damage to the 
Elliott Bay Seawall from seismic activity. A Feasibility Scoping 
Meeting is scheduled for the project this fiscal year.
                                 ______
                                 
            Questions Submitted by Senator Mary L. Landrieu

  coe deg.COMPLETION OF THE LEVEE SYSTEM FOR THE GREATER NEW 
                              ORLEANS AREA

    Question. On June 1, the city of New Orleans and the State of 
Louisiana will mark an historic and long-awaited milestone. The city 
that has given so much to this Nation--that is strategically located at 
the entrance to one of the world's largest river systems--will be 
protected against the ravages of a 100-year storm and flood event. The 
Corps of Engineers (COE) is to be commended for its work in completing 
this herculean task, but there are many questions left unanswered. 
Since the American people have invested nearly $15 billion in this 
effort, we have a serious responsibility to make sure this money is not 
wasted and that it will sustain a 100-year level of protection over the 
long term. I have a couple of questions on this point:
    Ms. Darcy, there is clear precedent in law and regulation for COE 
to assume operation and maintenance of navigation structures in 
federally navigable waterways. If COE does not have the legislative 
authority to operate the newly constructed structures along the Gulf 
Intracoastal Waterway, will the administration support legislation to 
give COE this authority?
    Answer. The hurricane risk reduction system in the Greater New 
Orleans area includes numerous floodgates, many of which cross roads, 
interstate highways, and navigation channels. The hurricane risk 
reduction floodgates crossing navigation channels are designed to have 
minimal interference upon navigation, unless there is a tropical event 
which requires their operation. Under current law, the Coastal 
Protection and Restoration Authority of Louisiana (LA-CPRA) is 
responsible for operating and maintaining all of the hurricane risk 
reduction system, including the floodgates. Two of the largest 
floodgates for the hurricane risk reduction system cross the Gulf 
Intracoastal Waterway (GIWW). Although these two surge gates are 
located across a Federal navigation channel, their purpose is to reduce 
the risk from storm surge and not for navigation. Requiring the State 
to be responsible for the costs of operation and maintenance is in 
keeping with requirements of Public Law 99-662, Public Law 109-234 and 
Public Law 110-252, all as amended.
    Furthermore, in keeping with the above legislative requirements, 
LA-CPRA has entered into Project Partnership Agreements and has agreed 
to be 100 percent responsible for the Operation and Maintenance of the 
hurricane risk reduction system project features. This applies to all 
features, including the pumping station and these two floodgates which 
cross the GIWW.
    Question. I understand from local levee officials that in order to 
maintain the 100-year level of protection, future ``lifts'' to increase 
the height of the levees will be needed in certain areas of the system. 
This will be caused by the settling of the material used to construct 
the levee and could be needed as early as next year. Will the 
administration budget for these critical needs and if so, why not?
    Answer. Public Law 109-234 and Public Law 110-252 authorized and 
funded COE to raise levee heights where necessary and otherwise enhance 
the existing Lake Pontchartrain and Vicinity project and the existing 
West Bank and Vicinity project to provide the level of protection 
necessary at the time of construction to achieve the certification 
required for participation in the National Flood Insurance Program 
(NFIP). Additional authority and funding would be required for the 
Federal Government to construct future levee lifts.
    Question. What do you estimate these needs to be, and how will it 
affect the certification of the overall levee system in New Orleans?
    Answer. The Greater New Orleans--Hurricane Storm Damage and Risk 
Reduction System will initially be accredited by the Federal Emergency 
Management Agency (FEMA) for a 10-year period. Current regulations 
require that FEMA to be notified if any part of the system fails to 
meet the certification requirements during the 10-year period.
    Additional authority and funding would be required to pursue 
construction of the future levee lifts and other additional measures on 
the Lake Pontchartrain and Vicinity project and the West Bank and 
Vicinity project to sustain FEMA system accreditation and participation 
in the NFIP in the future.
    The estimated cost for future levee lifts and other measures to 
sustain elevations necessary for system accreditation are not known at 
this time.
    Question. The Harbor Maintenance Trust Fund is authorized under the 
Harbor Maintenance Revenue Act of 1986 (Public Law 99-662, title XIV), 
as amended. Revenue is derived from a 0.125 percent ad valorem tax 
imposed upon commercial users of specified U.S. ports and investment 
interest. These funds are intended for the operation and maintenance of 
our ports and harbors--critical dredging that keeps these centers of 
navigation and commerce open for business. More than $1 billion is 
collected each year, and the total estimated balance in the fund this 
year is more than $7 billion. We have all of these funds, yet our ports 
and harbors are in desperate need of dredging. Why does the Harbor 
Maintenance Trust Fund carry billions in surplus when our critical 
ports and harbors are in desperate need of dredging funds?
    Answer. The balance in this trust fund, which has grown over a 
period of many years, reflects multiple factors, principally the value 
of goods subject to the harbor maintenance tax, the tax rate, the 
enacted spending levels, and the limitation in current law on the 
authorized uses of these receipts. In our view, the overall funding 
level that the Federal Government provides for maintenance dredging and 
related purposes should be determined independent of the level of the 
Harbor Maintenance Tax receipts. More specifically, the allocation of 
these funds should reflect consideration for the economic and safety 
return, as well as a comparison with other potential uses of the 
available funds.
    Our investments in coastal port maintenance are directed primarily 
at providing operational capabilities and efficiencies. To make the 
best use of these funds, COE evaluates and establishes priorities using 
objective criteria. These criteria include transportation cost-savings, 
risk reduction, and improved reliability--all relative to the cost. 
Consequently, maintenance work generally is focused more on the most 
heavily used commercial channels, which together carry about 90 percent 
of the total commercial cargo traveling through our coastal ports. 
However, many ports will experience draft limitations on vessels due to 
channel conditions, at least during parts of the year.
    While COE could spend more on harbor maintenance and related work, 
the amount proposed in the budget for this purpose, which is financed 
from this trust fund, is an appropriate level, considering the other 
responsibilities of COE for inland navigation, flood risk management, 
aquatic environmental restoration, hydropower, and the other Civil 
Works program areas. COE continues to develop analytical tools to help 
determine whether additional spending from this trust fund is warranted 
based on the economic and safety return, as well as a comparison with 
other potential uses of the available funds. Dredging costs continue to 
rise due to increases in fuel, steel, labor, and changes in methods of 
dredged material placement. We recognize that this presents challenges 
in maintaining commercial navigation projects.

coe deg.COASTAL RESTORATION AND PROTECTION--LOUISIANA COASTAL 
                                  AREA

    Question. I am very encouraged that the President requested 
construction funding for coastal restoration in Louisiana in his fiscal 
year 2011 budget. After decades of study and planning, we will finally 
be turning dirt to restore and protect our fragile coast. I understand 
that this represents 1 of only 2 new starts recommended by the 
President, but I want to emphasis how critical it is that we use these 
funds wisely and efficiently. Ms. Darcy, I understand that this is a 
programmatic funding request.
    How does COE intend to capitalize on the fiscal year 2012 budget 
request and ensure that multiple projects have received the appropriate 
executive branch approval?
    Answer. The President's fiscal year 2012 budget includes $10.6 
million to begin construction under the Louisiana Coastal Area (LCA) 
ecosystem restoration program. The COE district office is working on 
several reports, and my staff is working with them to expedite the 
appropriate approval process.
    Question. Also, which specific LCA projects will receive funding 
this year and the coming fiscal years?
    Answer. Fiscal year 2012 funds will be used to continue 
construction of authorized restoration projects underway in fiscal year 
2011 with reports that have favorably completed executive branch 
review, to initiate one new construction phase, and to continue 
monitoring and other restoration-related activities. Potential 
construction in fiscal year 2013 could include project(s) from the LCA 
6 portfolio, Beneficial Use of Dredged Material Program (BUDMAT), and 
the Demonstration Program. The specific project(s) selected for fiscal 
year 2013 construction will be based upon funding available, approval 
of individual reports by the executive branch and execution of the 
necessary agreements with the State of Louisiana.
    In fiscal year 2014 and beyond, we foresee continuation of 
construction for projects within the LCA 6, BUDMAT, and Demonstration 
Program with the addition of projects from the LCA 4 and LCA 5 
portfolios.

           coe deg.DREDGING NEEDS ON THE MISSISSIPPI

    Question. I have heard from a number of very concerned ports, 
businesses, and citizens about the navigability along the lower 
Mississippi River due to high water. The Mississippi is the central 
artery for navigation for nearly the entire Nation. As you know, 40 
percent of the entire continent is drained by the Mississippi River 
Delta. This drainage basin (approximately 1,234,700 square miles) 
covers about 40 percent of the United States and ranks as the fifth 
largest in the world. The inland waterways of the United States include 
more than 25,000 miles (40,000 km) of navigable waters. Much of the 
commercially important waterways of the United States consist of the 
Mississippi River system--the Mississippi River and connecting 
waterways.
    Do you have the funds you need to ensure that the Mississippi River 
remains open for business at the maximum authorized depths?
    Answer. The Army is committed to maintaining coastal navigation 
between the gulf and the ports of the New Orleans and Baton Rouge area. 
Funds to do so are included in the budget. The dredging needs on this 
part of the lower Mississippi River are difficult to predict, as they 
depend on flow conditions, sediment loads, and a variety of other 
factors, which vary each year as well as over the course of the year. 
COE continually monitors conditions on the river to ensure the most 
efficient use of available funds to minimize the need for any depth, 
speed or night-time restrictions.
    Question. How are you balancing this critical need with the needs 
that other essential waterways are facing across the State of Louisiana 
and the Nation?
    Answer. COE has a large inventory of navigation projects to 
maintain and seeks to provide levels of service that reliably and 
safely support freight movements in a way that provides the most 
overall value to the Nation from the available funds. Navigation 
projects were categorized as high, moderate, and low commercial 
navigation use based on tonnage. COE's approach involves a focus on the 
high and moderate commercial use navigation projects, which together 
move 99 percent of the Nation's waterborne commercial cargo. Generally, 
before providing more funding to a project, we consider whether we 
could achieve a greater return by applying those funds elsewhere. The 
low-use projects funded in the fiscal year 2012 budget were selected 
with the intent to optimize use of the available funding across a range 
of uses, with emphasis on harbors of refuge, subsistence harbors, 
projects with Coast Guard Search and Rescue stations, energy delivery 
projects where marine transportation is the only means to make the 
deliveries, and commercial navigation projects with less than 1 million 
tons of commercial cargo.

              coe deg.INLAND WATERWAY TRUST FUND

    Question. The Inland Waterways Trust Fund is used to pay one-half 
of the costs associated with the construction, replacement, 
rehabilitation, and expansion of Federal inland waterways projects. 
There are dozens and dozens of critical locks and dams that are in a 
dramatic state of disrepair--including 1 in New Orleans that has been 
waiting for replacement for more than 50 years. I am strongly opposed 
to the administration's proposal of a new funding mechanism, which 
would replace the existing fuel tax.
    However, I am most interested in knowing how COE plans to address 
the massive backlog of projects on the inland waterway system. Ms. 
Darcy, how is your agency addressing this critical need?
    Answer. Neither the administration nor the inland navigation 
community is content with current funding levels. In the short-term, 
the administration has been budgeting for the capital costs of inland 
waterways projects based on the level of anticipated revenues from the 
current excise tax on inland waterways diesel fuel.
    Question. Do you believe changing the funding mechanism is the best 
way to address the problem in this economy?
    Answer. The administration is open to discussions on revisions to 
the existing funding mechanism as well as new funding mechanisms.
                                 ______
                                 
             Questions Submitted by Senator Mitch McConnell

    Question. What funding levels are needed for fiscal year 2012 and 
fiscal year 2013 in order to maintain the Kentucky Lock project on its 
critical construction path?
    Answer. Two features of the Kentucky Lock and Dam project currently 
are underway: the superstructure feature (highway/railroad), which we 
expect to complete in December 2011, and the upstream lock monolith, 
for which we allocated funding under the American Recovery and 
Reinvestment Act of 2009. However, the Corps of Engineers (COE) does 
not plan to move forward with further work on Kentucky Lock and Dam 
project at this time due to the low level of the receipts to the Inland 
Waterways Trust Fund, as well as to the relative priority of these 
projects among the potential inland waterways capital investments. For 
example, the priorities of the Inland Waterways Users Board, which will 
be given due consideration in the formulation of future budgets, placed 
a higher priority for early construction on several other inland 
waterways projects and deferred completion of Kentucky Lock and Dam, as 
well as other projects. When the project is ready to resume, COE will 
develop a proposed schedule, after assessing the critical path toward 
completion at that time.
    Question. The inland waterway system has a number of lock and dam 
modernization projects whose construction completion dates have been 
significantly delayed and whose project construction costs have risen 
far beyond the levels originally authorized by the Congress for those 
projects. What do you believe the consequences will be of failing to 
adopt a workable, reasonable long-term capitalization plan to address 
this situation? Specifically, please speak to the specific long-term 
impacts to Olmsted Lock and Dam, Kentucky Lock, Wolf Creek Dam, and 
Greenup Lock and Dam projects without a capitalization plan.
    Answer. COE's program today is focused on the operation, 
maintenance, repair, rehabilitation, and replacement of major flood 
control and commercial navigation infrastructure systems, and the 
repair of aquatic ecosystems that COE projects have affected. The 
overall budget for the program is primarily devoted to maintaining 
these systems so that they can continue to provide economic, 
environmental and social benefits to the Nation.
    For example, an increasing proportion of our funding in recent 
years has been devoted to the maintenance and rehabilitation of 
existing infrastructure, primarily for flood risk management, but also 
for inland navigation projects. Similarly, the budget for the 
construction program gives priority to dam safety assurance, seepage 
control, and static instability control work (about $450-$500 million 
per year) to repair unsafe dam structures.
    The administration will be considering options for a comprehensive 
recapitalization policy for the Civil Works Program, but still is in 
the early stages of this effort, which will include an examination of 
current asset management tools and review of existing policies and 
authorities. It is anticipated that new authorities will be needed to 
ensure that the infrastructure continues to address the water resources 
priorities of the Nation.
    The projects you mention, and their costs, are not affected by the 
absence of a capitalization plan. The Olmsted Locks and Dam and the 
Wolf Creek Dam projects have received a priority for funding for many 
years. Their schedules and costs have changed principally due to a 
variety of other factors specific to those projects. For the Kentucky 
Lock and Dam project, we expect to complete the superstructure feature 
(highway/railroad) in December 2011. We also provided funding under the 
American Recovery and Reinvestment Act of 2009 for work on the upstream 
lock monolith. However, COE does not plan to move forward with further 
work on Kentucky Lock and Dam project or on the Greenup Locks and Dam 
project at this time due to the low level of the receipts to the Inland 
Waterways Trust Fund, as well as to the relative priority of these 
projects among the potential inland waterways capital investments.
    Question. Please provide an updated (to fiscal year 2011) 
``Benefits Foregone'' account of the economic cost to our Nation's 
economy due to lock and dam modernization projects that were not built 
using an efficient construction schedule (previous COE analysis 
attached).
    Answer. We no longer compile this information. It was inaccurate 
and misleading, as well as based on an unrealistic premise. However, we 
would be glad to provide it for any specific project, with appropriate 
qualifications.
    Question. What action is COE taking to be better stewards of 
taxpayer dollars?
    Answer. The budget focuses on the highest-performing projects and 
programs within the three main water resources missions of COE:
  --commercial navigation;
  --flood and storm damage reduction; and
  --aquatic ecosystem restoration.
    For example, the budget includes $51.78 million, more than a $40 
million increase, for a comprehensive levee safety initiative to help 
ensure that Federal levees are safe and to assist non-Federal parties 
to address safety issues with their levees. The budget also proposes to 
create savings and efficiencies through elimination of duplicative and 
lower-priority programs.
    Question. What is the estimated level of benefits not recoverable 
for the Olmsted project?
    Answer. The budget continues to place a high priority on the 
completion of this project. The primary benefits resulting from 
construction of the Olmsted Locks and Dam project (which also includes 
demolition of Locks and Dams 52 and 53) are vastly improved navigation 
transit at a key point on the Ohio River; coupled with significant 
decreases in current operation and maintenance costs due to the age and 
advanced deteriorated condition of Locks and Dams 52 and 53.
    COE, in its feasibility report, estimated that the construction of 
Olmsted Locks and Dam would reduce vessel transit costs and net Federal 
operation, maintenance, and repair costs by around $69 million per 
year. Operation and maintenance costs at Locks and Dams 52 and 53 
continue to increase. A failure event at either of these projects could 
close a key transit point on the river to navigation, with broad 
effects on commerce. This ongoing risk will increase until COE 
completes Olmsted Dam and the new locks are operational.
                                 ______
                                 
             Questions Submitted by Senator Lisa Murkowski

    Question. My understanding is the Pacific Division of the Corps of 
Engineers (COE) found deficiencies on appeal with the Alaska District's 
rejection of Conoco's section 404 application to construct a bridge to 
access the National Petroleum Reserve. As you know, the Native Village 
of Nuiqsut and really all of the local stakeholders supported the 
collaborative process that led up to this modified proposal. On remand, 
is COE looking closely at the record for what the local subsistence 
community prefers?
    Answer. The district considered local support for Conoco's 
preferred alternative as part of its public interest review in the 
original decision. All relevant public interest factors were carefully 
evaluated and balanced. The decision whether to authorize a proposal, 
and under what conditions, is determined by the outcome of this general 
balancing process, subject to other legal requirements. The district 
determined that the district's record of decision did not clearly 
document their decisionmaking process with respect to the public 
interest determination. Therefore, while Pacific Ocean division did not 
remand to Alaska district for the single issue of local support, the 
remand did instruct the district to clearly document the balancing 
process.
    Further, local support for a project does not obviate the section 
404(b)(1) guidelines requirement that only the least environmentally 
damaging practicable alternative (LEDPA) may be permitted, so long as 
that alternative does not have other adverse environmental 
consequences. Based on the information provided to the district, 
Conoco's proposal was not determined to be the LEDPA.
    Question. Prior to the COE's rejection of Conoco's permit on 
February 5, 2010, the Environmental Protection Agency (EPA) had 
designated the Colville River Delta ``an aquatic resource of national 
importance.''--an aquatic resource of national importance (ARNI). Ms. 
Darcy, what is your definition of ``national importance?''
    Answer. The term ``ARNI'' is used in the process established under 
an ``inter-agency dispute resolution memorandum of agreement'' (MOA) 
developed under section 404(q) of the Clean Water Act. The current 
404(q) MOA was signed by the EPA, Department of the Interior (DOI), 
Department of Commerce (DOC), and my office in 1992. The MOA provides 
procedures and timeframes for resolving inter-agency disputes regarding 
permit applications, in an effort to make timely permit decisions. An 
ARNI is a resource-based threshold used to determine which individual 
permit cases can be elevated under the 404(q) procedures. Factors used 
in past elevations to identify an ARNI include diverse high-quality 
ecosystems, rarity and uniqueness, and economic importance for fish and 
wildlife species. In other words, the underlying concept is simply that 
impacts to particularly important aquatic resources should be carefully 
evaluated.
    Question. Has the EPA ever designated an ARNI in consultation with 
COE or any other agency, or the public? Is there any transparency to 
the designation?
    Answer. The term ARNI is only used on the context of a Clean Water 
Act (CWA) section 404(q) elevation under the 1992 MOA between EPA, DOI, 
and DOC, to identify those individual permit cases that may be elevated 
to my office for review. EPA does not ``designate'' an aquatic resource 
as an ARNI. Rather, it concludes that the aquatic resources and 
proposed impacts are significant enough to request review by my office 
as provided in the MOA.
    Question. If COE disagrees with the EPA's designation of an ARNI, 
does COE have any means of reversing or modifying the designation?
    Answer. The conclusion that the aquatic resources and proposed 
impacts are significant enough to request review by my office is not an 
official designation or decision that requires reversal or 
modification. The term ARNI refers to a criterion used by the resource 
agencies (EPA, DOC, DOI) to determine if an individual permit may be 
elevated under the CWA section 404(q) elevation procedures.
    A District Commander may not reject a resource agency's substantive 
conclusion regarding its determination that the aquatic resource 
impacted by the proposed project is an ARNI and that the impact will 
result in an unacceptable impact on ARNIs. The 404(q) MOA is intended 
to allow agencies to elevate certain applications to my office, after 
following the specified procedures and timeframes described in the MOA.
    Once my office receives the request for review of the individual 
permit application from a headquarters office of the agency (e.g., the 
EPA Assistant Administrator for Water), the permit decision is held in 
abeyance.
    My office does have the ability and authority to agree or disagree 
with the designation of an ARNI and with the determination that the 
project will result in substantial and unacceptable impacts to ARNIs 
after thorough review of the permit and the decision document, and in 
many instances after an on-site meeting.
    I understand that there are several examples where my office has in 
fact disagreed with the resource agency designation and/or the 
determination of substantial and unacceptable adverse effects to ARNIs. 
If this occurs, my office will inform the headquarters office of the 
agency that sought headquarters review of the permit application of my 
decision. The permit is not finalized during a period of 10 days 
following my decision so that EPA if it desires may initiate a review 
under its 404(c) authority.
    Question. If COE moves forward with granting section 404 clearance 
to proceed with a fill project even after EPA has designated an area an 
ARNI, would COE consider it likely that EPA would use its section 404 
authority to veto the project?
    Answer. Not necessarily. Since 1972, when the Congress enacted 
section 404, the EPA has only prohibited a proposed action, as provided 
in section 404(c), about 14 times. The decision to initiate a 404(c) 
action rests solely with the EPA, and is not tied to the concept of an 
ARNI.
    Question. With CD-5, COE had worked with Conoco, the State of 
Alaska, and the local community stakeholders since 2004 toward an 
agreement on accessing CD-5, only to ultimately deny the permit in 
2010. How can we in the Congress justify spending on such a process if 
we ultimately don't have a project?
    Answer. CWA requires the chemical, physical, and biological 
integrity of the Nation's waters be restored and maintained. In 
accordance with this statutory requirement, the regulatory program 
decisionmaking process involves an evaluation conducted pursuant to the 
CWA section 404(b)(1) guidelines and a public interest review. These 
requirements are intended to ensure that proposed discharges into 
waters of the United States are not contrary to the public interest and 
do not result in unacceptable adverse impacts to the aquatic 
environment. The regulatory process is informed by the applicant as 
well as information provided by State and Federal regulatory and 
resources agencies, the local community and other interested 
stakeholders.
    In the case of CD-5, COE worked with Conoco Phillips Alaska Inc. 
(CPAI), the State of Alaska, and the local community stakeholders since 
2004 toward identifying a proposal that could potentially be approved 
for a permit. During those years, CPAI requested the application review 
process be suspended on occasion, as they made changes to their 
proposed project; and so they could continue to work with the local 
community stakeholders to come to a local agreement about access to the 
CD-5 area without impacts to subsistence use and local jobs, and to 
provide mitigation/compensation for social impacts to those 
communities, to name a few. COE worked diligently with CPAI to find a 
way to avoid and minimize impacts to jurisdictional waters. In 
addition, COE made numerous requests for information that would allow 
them to evaluate portions of the CD-5 project. It is the applicant's 
responsibility to supply all required and necessary information and to 
clearly demonstrate that their proposal is the least environmentally 
damaging practicable alternative. CPAI did not provide the information 
required to rebut the presumption that another alternative with less 
environmental impacts on aquatic resources did not exist.
    It is the responsibility of the regulatory program to take an 
unbiased look at each and every project, weigh the detriments and 
benefits and make a decision based on the law and regulations, public 
interest factors, and the purpose and need for a project. The 
decisionmaking process ends in one of several ways:
  --permit issuance;
  --permit issuance with conditions;
  --the applicants' withdrawal of their application; or
  --permit denial.
    COE works with applicants and the agencies to protect aquatic 
resources by ensuring that project proposals avoid and minimize 
unnecessary impacts and mitigate for unavoidable impacts. This process 
enables the agency to make favorable decisions on 99 percent of the 
applications received, and works as the Congress intended.
    Question. Is it possible to build a bridge, perhaps one of higher 
elevation or with better placed supports, through an area with an ARNI 
designation?
    Answer. ARNI designation does not prohibit an activity or a 
discharge in these aquatic resources, including building a bridge 
through an area identified as an ARNI. COE recognizes that if the 
resource agencies identify an area as an ARNI, that this term implies 
that the resource may be high quality, rare, unique, or have economic 
importance for fish and wildlife species, and that proposed impacts to 
these important aquatic resources should be carefully evaluated.
    Section 404(b)(1) of the CWA requires that only the LEDPA may be 
permitted, so long as that alternative does not have other adverse 
environmental consequences. COE denied the permit because it determined 
based on information provided by the applicant, input from the public 
and Federal resource agencies that a roadless alternative with 
horizontal directional drilling (HDD) would be the LEDPA.
                                 ______
                                 
    Questions Submitted to Lieutenant General Robert L. Van Antwerp
            Questions Submitted by Senator Dianne Feinstein

             coe deg.HARBOR MAINTENANCE TRUST FUND

    Question. It is my understanding that the Harbor Maintenance Trust 
Fund has a significant surplus. The budget request states the 
administration will be making a proposal concerning the Harbor 
Maintenance Trust Fund to the Congress. As I understand it, this 
proposal will allow other agencies that are conducting port related 
activities to charge those activities to the Trust Fund.
    Could you explain this proposal a little further?
    Answer. Several Federal programs support commercial coastal 
navigation (primarily Corps of Engineers [COE], Coast Guard, Federal 
Emergency Management Agency [FEMA], Customs, National Oceanic and 
Atmospheric Administration, and Department of Transportation), in a 
variety of ways. The fiscal year 2012 budget proposes to expand the 
authorized uses of the Harbor Maintenance Trust Fund (Trust Fund) 
receipts, so that they are available both for harbor maintenance and to 
finance the Federal share of other Federal activities that support 
commercial navigation through our ports. Spending would continue to be 
subject to annual appropriations decisions, just financed from the 
Trust Fund instead of the General Fund. The proposal would not limit 
the amount of annual spending for any specific purpose or program, such 
as harbor maintenance.
    Question. How does this proposal improve our Nation's harbors? It 
sounds like the same things will be accomplished but accounting for the 
costs will be different. Am I missing something?
    Answer. The proposal would support investments that contribute to 
the strength of the American economy. It would facilitate the 
development of a comprehensive investment strategy, improve the 
allocation of resources to and among multiple agencies, and provide 
transparency on the extent of the Federal support.
    Question. Won't this rapidly deplete the Trust Fund balance?
    Answer. The proposal is still under development. We expect the 
Trust Fund to retain a workable balance. We would work with the 
Congress to decide which other Federal coastal navigation efforts are 
covered. The extent of the long-term effect on the size of the Trust 
Fund balance would depend upon which other Federal activities are 
included.
    Question. When the trust fund is depleted by these new activities, 
how will we maintain the harbors and waterways that are currently 
funded through the Trust Fund?
    Answer. We expect the trust fund to retain a workable balance. 
However, if it were to be depleted at some future date, the Congress 
would then decide how to fund the Federal coastal navigation efforts, 
including those of COE.
    Question. Assuming these other activities will continue to be 
funded from the Trust Fund, will maintenance of these waterways be 
further restricted due to lack of funding in the Trust Fund?
    Answer. That is not our intent or expectation. In fact, there could 
be more dredging under the proposal. In our view, the overall funding 
level that the Federal Government provides to COE for maintenance 
dredging and related purposes should be determined independent of the 
level of the Harbor Maintenance Tax receipts. More specifically, the 
allocation of these funds should reflect consideration for the economic 
and safety return, as well as a comparison with other potential uses of 
the available funds.
    Question. The budget request states a number of times that you are 
addressing the highest-priority needs. It is also my understanding that 
the budget proposal does not provide for full authorized widths and 
depths to be maintained at any harbor maintained by COE. Has there been 
any calculation of the economic impacts by not fully dredging all of 
Nation's ports?
    Answer. There has been no calculation of the economic impacts of 
not fully dredging all of the Nation's ports. Maintenance of existing 
navigation channels to fully authorized dimensions would reduce the 
cost of some ship movements, but would not necessarily increase the 
total throughput capacity of the ports. The fiscal year 2012 budget for 
COE includes $758 million from the Trust Fund to support the 
maintenance of coastal harbors and their channels and related work. To 
make the best use of these funds, COE evaluates and establishes 
priorities using objective criteria. These criteria include 
transportation cost-savings, risk reduction, and improved reliability--
all relative to the cost. Our objective is to provide operational 
capabilities and efficiencies, with a focus on the most heavily used 
commercial channels (carrying more than 10 million tons of cargo/year), 
which together carry about 90 percent of the total commercial cargo 
traveling through our coastal ports.
    Question. It would seem that if the administration goal is to 
double exports, that fully dredging our ports and waterways would be an 
essential step in making this goal a reality. Am I missing something?
    Answer. Maintenance of existing navigation channels to fully 
authorized dimensions would reduce the cost of some ship movements, but 
would not necessarily increase the total throughput capacity of the 
ports. The fiscal year 2012 budget for COE gives priority to the 
maintenance of the Nation's large deep-draft harbors. The budget also 
includes $65 million for the ongoing deepening of the port of New York/
New Jersey; $42 million for construction/expansion of dredged material 
placement facilities at the ports of Norfolk, Virginia; Savannah, 
Georgia; and Jacksonville and Tampa, Florida in order to continue 
maintenance of the deep draft channels serving these ports; $600,000 
for preconstruction engineering design of Savannah Harbor expansion, 
Georgia; and $726,000 for a channel improvement study at Brazos Island 
Harbor (Brownsville), Texas.

                      coe deg.DAM SAFETY

    Question. Dam safety is of critical importance to our Nation and 
particularly California. Currently there are three dams in California 
in the most at-risk category.
    Could you explain COE's criteria on how projects are ranked related 
to risk?
    Answer. COE uses a dam safety portfolio management process that 
continually monitors and assesses the condition and risk associated 
with all COE dams and assigns a Dam Safety Action Classification 
(DSAC). The priority for funding is focused on addressing the highest-
risk dams with the most cost-effective risk reduction alternatives for 
all DSAC I, II, and III projects. DSAC I dams have been determined to 
have a confirmed urgent and compelling issue that requires taking 
immediate and expedited actions to reduce and manage the risk. 
Therefore, DSAC I dams with life safety consequences are given first 
priority. For prioritization within DSAC II and III projects, 
significant weight is given to the quantitative tolerable risk 
guidelines, but other nonquantitative considerations, including As Low 
as Reasonably Practical (ALARP), are also used for a more complete 
basis. The greater the estimated annual probability of failure and the 
further the estimated life risk is above the tolerable risk limit, then 
the greater the urgency to act. Further detail on ranking criteria is 
available in Draft ER1110-2-1156, Chapter 6.3. Draft version of ER 
1110-2-1156 has been released as interim guidance to the field. The 
regulation is available for download at http://www.usace.army.mil/CECW/
Documents/cecwe/er1100_21156_1nov10.pdf.
    Question. Can you explain what risks these dams and the people 
below them are facing and what actions are taken to reduce risks while 
studies are undertaken and corrective plans formulated?
    Answer. COE executes its project purposes guided by its commitment 
and responsibility to public safety. It is after public safety 
tolerable risk guidelines are met that other purposes and objectives 
are considered. COE dams are geographically widely spread across the 
Nation and exhibit varying degrees of deficiency and life-safety risk. 
Interim Risk Reduction Measure Plans (IRRMP) are the key documents that 
frame operational decisionmaking for high-risk dams (DSAC I, II, and 
III). Structural and nonstructural alternatives for the interim risk 
reduction measures are evaluated for effectiveness to reduce the 
probability of failure and/or consequences associated with the failure 
modes. Reservoir pool restrictions, modification of reservoir 
regulation plan, and updating of Emergency Action Plans (EAPs) are 
always evaluated as options. The IRRMPs establish the specific 
threshold events, decision points, and actions required. COE discusses 
issues consistently and openly with affected stakeholders upstream and 
downstream of our structures.
    Question. These studies seem to take an inordinately long time, 
particularly for high-risk dams. For instance, Lake Isabella in my home 
State has been under study for the last 6 years. Isn't there a way to 
accelerate these studies so the remediation work can get started?
    Answer. The risk-informed approach that COE is implementing will 
allow focus on our most critical deficiencies. This focus will provide 
a more expedited repair to our worst issues. Given the multiple 
purposes of most COE dams and the long-term benefits provided, the 
projects will still require thorough analysis of any modification to 
assure public safety by modification to the dam. Dam analysis and 
designs are complex technical efforts. Risk assessments must be 
performed to understand the extent of a problem and to evaluate options 
to fix the dams. In many cases, COE dams have multiple deficiencies 
which increase the complexity of repair.
    Question. Your budget proposes $436.7 million for repairs to 10 
projects and an additional $37.2 million to continues studies on other 
dams that have various risk ratings. Repairs on some of these projects 
are multi-year and, in many cases, extremely expensive--with the 
repairs often costing more than the original dams. Does COE have 
additional capability for dam safety work in fiscal year 2012?
    Answer. All DSAC I projects that are ready for construction, and 
some DSAC II projects, are funded at the maximum rate that COE can 
efficiently and effectively use funds. Decisions on the funding for 
other dam safety projects (other DSAC II projects and all DSAC III 
projects) include consideration of budgetary and technical resources as 
well as other factors.
    Question. Your budget proposes $27.6 million for evaluation studies 
and lists 100 different dams where these studies would be conducted. 
That works out to about $275,000 per study. That seems very low. Can 
you explain this better?
    Answer. The fiscal year 2012 budget will progress study efforts at 
73 projects with levels of effort ranging from $50,000 to $800,000. The 
prioritization and funding amount is re-evaluated quarterly to adjust 
to incidents, study progress, successful performance during flood 
events, and other relevant information.
    Question. Is this a list of potential studies that will be 
undertaken or will all 100 be underway in fiscal year 2012?
    Is it also fair to assume that when these projects were formulated 
prior to authorization and construction, that the 50-year maintenance 
costs were factored into the benefit cost ratio that led to their 
authorization and construction?
    Answer. An estimate of the 50-year maintenance costs has been 
factored into the benefit-cost ratios for projects proposed by COE 
under the 1983 Principles and Guidelines and prior planning guidance.
    Question. Further, the budget request proposed $9.5 million to 
undertake post-evaluation work. However, there is no description of 
what this post evaluation work is or which projects it would be 
undertaken on. Can you provide some more information?
    Answer. Dam Safety Modification reports for Addicks and Barker Dams 
(DSAC Is) are scheduled to be approved in fiscal year 2012 and Pre-
Construction Engineering & Design (PED) for these dams will be 
initiated in fiscal year 2012. COE is initiating PED and some limited 
site preparation construction on Bolivar and East Branch Dams (DSAC 
IIs) that have approved Dam Safety Modification reports, but that will 
not be funded for construction until fiscal year 2013.
    Question. With the number of dams that are considered high risk and 
the decline of your budget request over the last 3 years, how are your 
future budgets going to be able to accommodate these increasing costs?
    Answer. The Army manages risks across a broad portfolio of 
structures, with the objective of reducing the overall portfolio risk. 
The decision on priorities in project queues is risk informed and 
performed from a national perspective. Over much a longer period than 
just the past 3 years, the budget has consistently funded all DSAC I 
projects and some DSAC II projects at the maximum rate that COE can 
efficiently and effectively use funds.
    There are 10 continuing DSAC I and II dam safety projects funded in 
the fiscal year 2012 budget for a total of $436.7 million. This funding 
is allocated within the construction appropriation. As additional high-
risk dams are identified we will work to address them as well. We 
expect to continue funding all DSAC I projects that are ready for 
construction, and some DSAC II projects, at the maximum rate that COE 
can efficiently and effectively use funds.

                      coe deg.SMALL PORTS

    Question. Your budget request cuts funding to many small ports and 
harbors across the country. Can you tell us a little about the criteria 
used to determine those cuts?
    Answer. Navigation projects were categorized as high, moderate, and 
low commercial navigation use based on commercial tonnage. Funding is 
focused on high and moderate navigation projects (coastal projects 
carrying at least 1 million tons of cargo and inland waterways with at 
least 1 billion ton-miles of traffic), which move 99 percent of the 
Nation's waterborne commercial cargo. The low-use projects funded in 
the fiscal year 2012 budget were selected with the intent to optimize 
use of the available funds for such projects across a range of uses 
including critical harbors of refuge, subsistence harbors, projects 
with Coast Guard Search and Rescue stations, energy-delivery projects 
such as home heating oil where marine transportation is the only means 
to make the deliveries and navigation projects with significant, albeit 
less than 1 million tons of commercial cargo.
    Question. Was the criteria that you used for determining your 
budgetary priorities for fiscal year 2012 contemplated when these 
projects were originally formulated, authorized and constructed?
    Answer. No. The prioritization criteria for the Operation and 
Maintenance program consider the current use of a project and a variety 
of other factors, in order to assess how the return on a further 
investment to the Nation in maintenance compares with other potential 
uses of those funds.
    Question. Was it safe to assume that if the project was 
economically justified, that the administration would budget for 
maintenance of the project as appropriate?
    Answer. No. However, if the construction of the project was found 
by the executive branch to be economically justified at that time, the 
administration generally will consider the project for funding.
    Question. Can we, for argument's sake, assume that nearly all the 
projects that were not budgeted in fiscal year 2012 were economically 
justified, when construction was completed?
    Answer. No. Many projects were authorized without an approved COE 
report. Others are not being funded due to policy concerns that arose 
prior to their construction.
    Question. This would mean that all of these unbudgeted projects 
were determined to accrue benefits to the national, as well as, the 
regional and local economies, am I correct?
    Answer. Many, but not all, of the projects would have a COE report 
that estimates that the project would accrue net benefits. However, key 
assumptions in these reports may be open to question. For example, 
benefit estimates for a proposed navigation project generally rely on a 
speculative projection of future traffic levels.
    Question. Was there any analysis to determine if the ports were 
moving the tonnage projected in the documents that led to authorization 
and construction of the projects?
    Answer. COE has not conducted such an analysis as this would be a 
large undertaking for an inventory of more than 1,000 navigation 
projects.
    Question. It would seem to me that if a port was meeting its 
tonnage projections, that it would most likely be meeting the economic 
projections from the original analysis conducted prior to 
authorization. Is it safe to assume that some of these small ports 
would have had small tonnage amounts projected, but yet were still 
considered economically justified?
    Answer. Some of these ports would have been justified based on 
tonnage projections. However, even where the tonnage is on track with 
projections, dredging costs have increased dramatically since many 
projects were authorized. Also, the economic analysis in these reports 
generally does not account for the effects of funding limitations.
    Question. Then how can you not budget for a port that is meeting 
tonnage projections?
    Answer. The fiscal year 2012 budget seeks to allocate the available 
Federal funds to the activities that will have the highest return on 
investment to the Nation.
    Question. Was there any analysis of the impacts to the national, 
regional, and local economies of not funding these ports and harbors in 
your budget?
    Answer. No, this would be a large undertaking with an inventory of 
more than 1,000 projects.
    Question. It appears that your criteria being based solely on 
tonnage would put many ports at a disadvantage to even be considered 
for funding. How do you justify this criteria?
    Answer. While most economists agree tonnage is not a direct measure 
of the economic benefit, it is a good first-order approximation and 
there is little agreement on an alternative.
    Question. Wouldn't some type of economic analysis be in order to 
determine the value of these ports to the national, State, and local 
economies rather than basing your decision solely on tonnage?
    Answer. We are working to allocate the funds as best as possible. 
There is also a cost associated with more analysis. However, COE 
continues to develop analytical tools to help determine whether 
additional spending for harbor maintenance and related activities is 
warranted based on the economic and safety return, as well as a 
comparison with other potential uses of the available funds.
    Question. Wouldn't the economic value of these ports be a better 
indicator of where maintenance funding should be concentrated?
    Answer. We are open to considering other factors. However, in 
allocating maintenance funds, we are mostly trying to find the best use 
of an incremental investment above or below the amounts that we are, or 
are not, already providing.

                      coe deg.NEW STARTS

    Question. For fiscal year 2011 you proposed two new construction 
starts for a total of $29 million. These two starts, if they are 
started, require outyear funding in excess of nearly $2 billion. For 
fiscal year 2012, you have proposed two more new construction starts 
that will require outyear funding in excess of $120 million. With the 
declines in your budget requests that have been recommended in the last 
3 years, how do you expect these projects to be funded in future years?
    Answer. In the out-years, they would continue to compete for 
funding, as they did successfully in the development of the fiscal year 
2011 and fiscal year 2012 budgets. Also, the $2 billion total for the 
two fiscal year 2011 new construction starts mostly reflects the cost 
of authorized work under the Louisiana Coastal Area ecosystem 
restoration program to address the effects of large and continuing 
wetland losses on the ecosystem. Each year of delay could complicate 
the long-term restoration effort.
    Question. How were the two ``new starts'' in the President's budget 
selected? What criteria were used?
    Answer. Raritan to Sandy Hook (Port Monmouth), New Jersey, 
qualifies as a ``Risk to Life'' new start. This project addresses a 
significant risk to human safety and damage to property resulting from 
increased flood exposure, shoreline erosion, and increased exposure of 
the shore and inland areas to tidal inundation and wave attack damages. 
This increased exposure, combined with runoff from coastal creeks, 
results in increased danger of high flood depths and water velocities 
with little warning time.
    Hamilton City, California qualifies as an ecosystem restoration new 
start predominantly because it connects four other restored 
environmental areas, thereby providing a larger continual habitat 
corridor. This project will also provide ancillary flood risk 
management benefits to Hamilton City and nearby agricultural lands.
    Question. The new study starts that you have proposed are all 
ecosystem restoration studies. Are there no new flood control or 
navigation studies that warrant the administration's support?
    Answer. While there are many potential flood control and navigation 
new study starts, the four new study starts proposed for the budget 
were considered to be a higher priority.
    Question. What did the administration hope to demonstrate through 
selection of these particular projects?
    Answer. The four new studies (in addition to those proposed in 
fiscal year 2011) include:
  --Englebright and Daguerre Point Dams (Yuba River) Fish Passage, 
        California;
  --Cano Martin Pena, Puerto Rico;
  --the Chesapeake Bay Comprehensive Plan; and
  --the Louisiana Coastal Area Comprehensive Study.
    Three of these studies were proposed as new starts because they 
will examine ways to contribute to restoration and increased 
sustainability of ecosystems that were part of last year's interagency 
collaborative planning initiative. The study of Cano Martin Pena, 
Puerto Rico will examine ways to provide critical estuarine habitat 
restoration and move people out of a floodway.
    Question. It is my understanding that more than half of the Chief 
of Engineers reports expected to be submitted to the Congress this year 
are ecosystem restoration studies. Doesn't this indicate an unbalanced 
program if the majority of studies being produced are for ecosystem 
restoration rather than the more traditional COE's missions of flood 
control and navigation?
    Answer. The distribution of Chief's reports among mission areas 
will vary year to year. The number of reports in any one year is not an 
appropriate indicator of the makeup of the construction program. Also, 
the budget funds studies and preconstruction engineering and design 
work for many proposed flood control and navigation projects.

                   coe deg.LEVEE VEGETATION

    Question. COE is developing new national policies for the allowance 
and/or removal of trees and other vegetation from levee projects. 
Meanwhile, COE has participated in a collaborative effort with the 
State of California to develop vegetation-removal guidelines for the 
Central Valley. This collaborative effort holds promise for reaching a 
reasonable and balanced program for assuring levee integrity and, at 
the same time, taking into consideration unique circumstances and 
resources found in many areas in the Central Valley, and COE's past 
involvement with the region's levees. What is the proposed timing on a 
revised draft vegetation variance process and when does COE plan to 
have a final policy?
    Answer. COE's goal is to work with resource agencies, such as the 
National Marine Fisheries Service, U.S. Fish and Wildlife Service, and 
the Environmental Protection Agency, and levee owners to transition 
noncompliant levees to COE standards, including vegetation standards. 
Achieving this goal will allow us to jointly maintain public safety, 
ensure eligibility under Public Law 84-99 for assistance in making 
repairs after a flood, and comply with Federal environmental laws.
    Noncompliant levee vegetation may affect the safety, structural 
integrity and function of the levees, could obstruct visibility for 
inspections, impede access for maintenance, and could block emergency 
flood fighting operations. Clear vegetation policies, standards, and 
practices are critical to an effective life-cycle flood risk management 
program.
    The vegetation variance policy referenced in the question was 
originally issued in 1997 to implement section 202(g) of the Water 
Resources Development Act of 1996. The policy recognizes that there may 
be some instances where vegetation may preserve, protect or enhance 
natural resources and/or protect the rights of Native Americans. This 
variance process is designed to accommodate those special cases when it 
is possible to do so while still maintaining the safety, structural 
integrity and function of the levees, and allowing access for 
inspection and flood fighting. In August 2009, COE began revising this 
vegetation variance request process to reflect current organizational 
changes and levee safety program principles such as utilizing agency 
technical reviews, applying a systems approach, and ensuring COE levee 
safety technical leads are part of the process.
    Due to strong interest from sponsors in how changes to this 
vegetation variance request process may impact them, COE solicited 
comments on the proposed revisions through the Federal Register, with a 
notice and comment period from February 9, 2010 to April 26, 2010. COE 
received more than 500 comments from more than 100 separate 
organizations and individuals. As a next step, COE is considering 
whether to post, for the second time, a revised draft vegetation 
variance request policy for public comment.
    Question. Out of the hundreds or thousands of levee failures over 
the years, how many (and what percent) were caused by vegetation on a 
levee?
    Answer. It is very difficult to determine after the fact whether 
one factor, such as vegetation, can be attributed to the cause of a 
levee breach, unless it was observed, documented, and studied during 
the actual failure. Because direct impacts of vegetation on levees 
cannot be quantified, potential impacts are based on field 
observations. COE is aware of instances in which vegetation has been a 
hindrance to inspections, monitoring, and flood fighting during a flood 
event. Moreover, vegetation can obstruct the ability to detect 
indicators for a potential levee breach, such as seepage.
    Question. As part of the vegetation variance process, is COE 
willing to consider regional variances which address vegetation 
management within the context of unique geographic settings such as 
exist in California?
    Answer. COE recognizes that just as no two regions are the same 
ecologically, no two levee systems are the same from an engineering 
perspective. The current draft policies allow for the consideration of 
the unique engineering and environmental context of particular levee 
systems to develop vegetation management solutions that address both 
levee safety and natural resource requirements. The ultimate goal is to 
work with resource agencies and levee owners to transition noncompliant 
levees to COE's standards, which may include obtaining vegetation 
variances or identification of other solutions to fit the specific 
regional conditions. For example, since 2008, COE and California have 
been engaged in the California Levee Roundtable, a collaborative 
partnership of Federal, State, and local organizations that facilitates 
the consideration of the local environmental and engineering context to 
develop systemwide levee solutions throughout the region. COE hopes to 
be able to continue this collaborative process with willing State 
participants.
    Question. Is COE willing to consider regional variances which 
prioritize vegetation management with respect to all risk factors, 
without inhibiting or delaying the remediation of higher-priority risk 
factors?
    Answer. COE supports prioritizing how and when levee deficiencies 
are addressed based on risk. This approach has been integrated into the 
COE systemwide improvement framework policy. This policy provides an 
opportunity for local levee authorities to use an interagency approach 
to identify solutions that optimize resources, and to sequence 
improvements and corrective actions based on risk. This approach is 
available to the Central Valley levees through the California Levee 
Roundtable.
    Question. Is COE willing to consider regional variances which 
provide clear guidance on the level of detail needed for a variance, 
how that detail will be evaluated, and an appeal procedure should COE 
and the local sponsor disagree on the outcome of the process?
    Answer. The most recent revisions to the draft vegetation variance 
process are designed as a collaborative approach through which there 
will be early determination on the most viable approach to meeting COE 
policies and standards while complying with applicable laws, 
regulations, and treaties. The intent is that any conflicts or issues 
should be raised and resolved during the collaborative process as 
opposed to having a formal appeal process. As such, it is likely that a 
decision to pursue a vegetation variance could be identified early in 
the process, diminishing the need for extensive environmental and 
engineering analysis. For situations in which the levee sponsor would 
like to pursue a vegetation variance request, more detail has been 
added to the technical requirements in the draft policy so the levee 
sponsor can better estimate the cost requirements. Though the review 
and approval process remains the same, COE believes these steps are 
necessary to make a well-informed decision about a levee system that is 
providing economic and safety benefits to the public living behind the 
levee.
    Question. How does COE intend to evaluate, disclose, and address 
the impacts of this process on the environment and endangered species 
impacts?
    Answer. COE recognizes that in carrying out its responsibility to 
promote safety and reduce the risk of damage to property through 
structurally sound levees, the agency must address environmental and 
natural resource needs through compliance with all applicable laws, 
regulations, and treaties. COE will comply with all applicable 
environmental requirements in implementing the policy for requesting a 
variance from COE vegetation management standards for levees and 
floodwalls.
    COE believes that the best approach is to review the environmental 
impacts of the application of specific standards as they are applied to 
site-specific circumstances. With this approach, COE recognizes that 
each levee is a unique flood risk reduction system that operates within 
the broader and equally unique local ecosystem. This approach also 
recognizes that the analysis of potential environmental impacts is 
dependent upon future, undetermined actions and decisions of the levee 
sponsors who operate and maintain the levee systems.
    When environmental requirements are triggered as COE makes 
decisions on the inspection standards applied to specific levee 
systems, the COE will work closely with the levee sponsors, appropriate 
resource agencies and tribes, as well as other interested parties to 
complete the required environmental compliance.
    Question. Many encroachments that do not comply to new policies, 
including but not limited to trees, in California's levee systems were 
either installed, permitted, or required by COE. In other cases the 
encroachments existed at the time the completed Federal project was 
turned over to non-Federal sponsors for operation and maintenance. 
Under COE's new policies (or new implementation of old policies) how 
will the COE's share responsibility for addressing the construction and 
environmental costs of compliance?
    Answer. ``Encroachments'' are features such as fences and utility 
lines requested by the non-Federal sponsor to be added within the levee 
system project real-estate easement after project completion. 
Encroachments and vegetation are handled differently under COE 
policies. COE has a well-defined encroachment permit process. 
Unpermitted encroachments will be the responsibility of the non-Federal 
sponsor to correct, including construction costs and environmental 
compliance. For vegetation, related policies are still under review and 
not yet final. However, in the final policy COE intends to clearly 
identify responsibilities of the non-Federal sponsor and COE, including 
situations when COE will be responsible for addressing the cost of the 
vegetation (both corrective actions and environmental compliance).
    Question. California's Department of Water Resources (DWR) 
developed a rough cost estimate that compliance with COE's vegetation 
guidance would cost about $7 billion for 1,600 miles of Federal levees 
in the Central Valley. If that is correct, would you think that 
compliance is a good investment?
    Answer. The California DWR also has said that given the overall 
condition of the levees in the Central Valley, higher-risk deficiencies 
such as underseepage, structural instability, and erosion should be 
addressed first. In general, COE agrees with this assessment. COE 
supports DWR's goal to leverage resources by prioritizing levee 
remediation in order to maximize improving safety. COE is currently 
working with DWR to incorporate such prioritization as part of the 
State's long-term strategy for levee improvements that will be outlined 
in the California Central Valley Flood Protection Plan.
    Question. Does COE have its own cost estimates for compliance with 
its vegetation guidance?
    Answer. No, meeting COE vegetation management standards is an 
operation and maintenance responsibility typically implemented by a 
local levee sponsor.
    Question. Will section 104 credit and section 408 approval be 
available for projects that do not meet the Levee Vegetation ETL, as 
long as non-Federal partners are addressing higher-risk factors. How 
will this be manifested in COE processes?
    Answer. COE supports modifications that will improve the levee 
system and recognizes it may not be possible for a local levee sponsor 
to address all deficiencies at one time. The determination for credit 
(now considered under section 2003 of WRDA 2007, not section 104) or 
section 408 approval for levees that do not meet COE standards for 
vegetation will be evaluated on a case-by-case basis. Further, the 
vegetation variance request process and the section 408 approval 
process can be combined where appropriate.

                  coe deg.LEVEE CERTIFICATION

    Question. It is my understanding that you have or are planning to 
implement an engineering circular entitled ``USACE Process for the 
National Flood Insurance Program Levee System Evaluation''. This EC for 
the first time establishes a 10-year time limit for levee 
certification.
    Can you tell us how you arrived at this 10-year limit, whether 
stakeholders were involved in that process?
    Answer. Currently there is no FEMA requirement for periodic review 
of levee certifications. Until FEMA policy is established, it is 
recommended that, for every certification issued by COE after 10 years, 
the certification should be reviewed or verified. Flood risk and levee 
conditions can change over time and it is important to ensure that a 
levee still meets expected requirements. The 10 years is to serve as a 
maximum timeframe between certification determinations. A certification 
can be reviewed any time before the 10 years, if it is of professional 
opinion there are indications that the project may no longer meet levee 
certification requirements. Throughout development of this EC, 
stakeholders were provided opportunities to provide input.
    Question. What do you see as the process going forward for those 
levees whose certification is older than 10 years, and can you give us 
a sense of how this decertification effort will impact COE's civil 
works budget?
    Answer. It is a local community's responsibility to provide FEMA 
documentation that a levee meets NFIP criteria for flood mapping 
purposes. COE does not anticipate any impacts from this effort on the 
Civil Works budget because we do not budget for levee certification.

             coe deg.CALIFORNIA-SPECIFIC QUESTIONS

    Question. The U.S. Geological Survey (USGS) has told my office that 
there is a high probability that a moderate to severe earthquake could 
lead to the failure of more than one-half of the levees in the 
Sacramento Delta. According to the 2009 Delta Risk Management Strategy 
developed by the California DWR using USGS data: ``an earthquake of 
magnitude 6.7 or greater has a 62 percent probability of occurring in 
the San Francisco Bay Area between 2003 and 2032. Such an earthquake is 
capable of causing multiple levee failures in the Delta region which 
could result in fatalities, extensive property damage and the 
interruption of water exports from the Delta for an extended period of 
time.''
    What actions has COE taken to reduce the risk of major, multiple 
levee failures in the Sacramento Delta?
    Answer. COE is partnering with the State of California and the 
Bureau of Reclamation (BOR) as described below on the following 
initiatives related to improving the levee system in the Sacramento-San 
Joaquin Bay-Delta:
      Geographic Information System (GIS) Contingency Mapping and 
        Emergency Response Planning.--A Memorandum of Agreement (MOA) 
        was signed between COE and the California Department of Water 
        Resources (DWR), allowing COE and DWR to initiate phase 1 of 
        GIS Flood Contingency Mapping and Emergency Response Planning 
        for the Delta region. The team met with Delta counties in 
        August 2010 to gather input on concepts for the GIS products, 
        response report, and related data. The second round of meetings 
        were held in November 2010 to present the 35 percent complete 
        product, validate data collected thus far, and gather 
        additional information from county and RD representatives. 
        During July 2011, the PDT met with State and local 
        representatives to review the 65 percent product. The 100 
        percent product is expected in fall 2011. This will constitute 
        the end of our phase I of GIS Flood Contingency Mapping and 
        Emergency Response Planning for the Delta region. The products 
        will be immediately useful for emergency response planning and 
        will include:
    --Standardized GIS database of Emergency Management data;
    --Flood Contingency Map Books and large-scale wall maps of the 
            Delta region; and
    --An accompanying report documenting the existing framework, 
            existing data, and any potential data gaps.
      In May 2011, COE, along with other State, Federal, and local 
        agencies, participated in the California Emergency Management 
        Agency-led 2011 Golden Guardian Exercise. This year included a 
        3-day Full Scale Exercise based on a major flood in 
        California's Inland Region (Delta).
      Delta Islands and Levees Feasibility Study.--The Delta Islands 
        and Levees Feasibility Study (Delta Study) is a cost-shared 
        study to explore potential solutions to address ecosystem 
        restoration needs, flood risk management problems, and related 
        water resources issues in the Delta and Suisun Marsh area. The 
        President's fiscal year 2012 budget includes $1.015 million for 
        this feasibility study. A Feasibility Cost Share Agreement 
        (FCSA) was executed in May 2006 with the California DWR, the 
        non-Federal sponsor. The COE-DWR study team meets regularly to 
        move the study forward and holds periodic Agency Coordination 
        Meetings with associated Federal, State and local agencies, 
        including BOR.
      On August 11, 2011, COE will participate in an interagency 
        meeting to discuss preliminary Sacramento--San Joaquin Delta 
        Modeling. The objective of this modeling is ``to develop 
        representative hydrodynamic, sediment transport, water quality, 
        and ecosystem models that enable COE's Sacramento District to, 
        with solid scientific support, understand the system-wide 
        impact of natural and purposeful changes to the Delta and allow 
        it to proactively manage these vital water resources.'' We 
        expect the basic model to be completed by December 2011. This 
        will be a useful tool to aid project planning and emergency 
        response planning in the Delta.
      The feasibility study will culminate in a feasibility report that 
        will make recommendations on possible solutions and next steps.
      Interagency Federal Action Plan.--On a broader level, COE 
        supports the Interagency Interim Federal Action Plan for the 
        Bay-Delta (December 2009) and its Update (November 2010). The 
        Action Plan consists of studies, programs, and actions that 
        address essential Bay-Delta issues including helping to ensure 
        integrated flood risk management. The Bay Delta Conservation 
        Plan (BDCP) has been identified as a priority effort by the 
        State and in the Interim Federal Action Plan. COE's Regulatory, 
        Operations, and Planning Programs regularly participate in 
        coordination related to the BDCP. Regulatory and operations 
        have proactively engaged the State, BOR, and others to ensure 
        that they understand Clean Water Act section 404 and section 10 
        and section 14 of the River and Harbors Act permitting 
        requirements and processes that may be required for the BDCP. 
        COE also participates in interagency (State-Federal) groups 
        focused on advancing science to inform management decisions, 
        including those related to levees, in the Bay-Delta.
    Question. How does COE prioritize which levees it repairs?
    Answer. In coordination with local and State partners, mainly the 
California DWR, COE prioritized levee improvements in the 2006 ``Report 
to Congress'' based on risk associated with levee failure (protection 
of life, property, infrastructure, etc.). Ongoing project 
prioritization is based on how well each project met environmental, 
economic, and other implementation criteria including availability of a 
local cost-share partner. The Delta Islands and Levees Feasibility 
Study will make recommendations to address flood risk management for 
the Delta as a system.
    Question. When prioritizing levee repairs, has COE taken into 
account which levees are most likely to allow salt water to enter the 
fresh water supply for 20 million Californians should the delta levees 
fail?
    Answer. System-wide assessments and recommendations, including 
impact of delta levee failure on the freshwater supply, will be 
evaluated under the Delta Islands and Levees Feasibility Study. The 
2006 ``Report to Congress'' considered risk to water supply.
    Question. Does COE have an estimate of the overall damage, 
including loss of the fresh water supply, and cost to repair the levees 
should a serious earthquake strike northern California?
    Answer. COE does not have a current estimate of the overall damage, 
including loss of the fresh water supply, and cost to repair the 
levees. This will be evaluated under the Delta Islands and Levees 
Feasibility Study. The California DWR published a report that does 
provide an estimate. This effort is the State's in-kind cost-share for 
the Delta Islands and Levees Feasibility Study.
    Question. Does COE have an estimate of how much it would cost to 
reduce the risk of massive levee failure from ``high'' to ``moderate'' 
or ``low''?
    Answer. No. This will be evaluated under the Delta Islands and 
Levees Feasibility Study.
    Question. The maritime industry in California carries more than 40 
percent of the Nation's waterborne international cargo. Recent studies 
by COE show that there is more than $400 million worth of cargo 
disrupted for every foot of reduced depth of channel. However, while 
dredging costs on a per-yard basis have increased 160 percent 
nationally over the past decade, ports across California and the Nation 
have not been provided adequate funding to maintain their 
congressionally authorized dredge depths. Why is it that numerous 
Federal channels in California are not at their congressionally 
authorized depth and width?
    Answer. Navigation channels rarely have full depth and width 
available. At present, only 2 of the top 10 navigation projects in COE 
inventory have full depth and width available. These two projects (both 
are in the State of California) are, in large part, naturally deep and 
do not require significant maintenance dredging.
    Question. How does the President's budget request for fiscal year 
2012 achieve the goals of maintaining the channels in California to 
their authorized depth and width as well as meeting the President's 
National Export Initiative?
    Answer. The President's fiscal year 2012 budget includes $8.75 
million in the operation and maintenance account for the Oakland 
Harbor, and $8.15 million for the Richmond Harbor; as well as $350,000 
in the construction account to continue work associated with the 
construction of the Oakland Harbor 50 feet deepening. These efforts 
support commercial use of deep draft navigation projects (1million tons 
of commercial cargo or more per year) as follows: the Oakland Harbor 
has 17 million tons of commercial cargo per year and the Richmond 
Harbor has 25 million tons of cargo per year.
    In addition, the President's fiscal year 2012 budget includes $65 
million for the ongoing deepening of the port of New York/New Jersey; 
$42 million for construction/expansion of dredged material placement 
facilities at the ports of Norfolk, Virginia; Savannah, Georgia; and 
Jacksonville and Tampa, Florida in order to continue maintenance of the 
deep draft channels serving these ports; $600,000 for preconstruction 
engineering design of Savannah Harbor expansion, Georgia; and $726,000 
for a channel improvement study at Brazos Island Harbor (Brownsville), 
Texas. The budget also includes $580 million in the Operation and 
Maintenance appropriation to maintain our high and moderate commercial 
use deep draft navigation projects that support 1 million tons of 
commercial cargo or more per year.
                                 ______
                                 
               Question Submitted by Senator Tim Johnson

    Question. The Cheyenne River Sioux Reservation in my State faces 
acute water needs. For years, the only intake for a land mass the size 
of Connecticut was in the Cheyenne River. That location had many 
problems, including the intake coming precariously close to taking in 
air when the Corps of Engineers (COE) would draw down the Oahe 
Reservoir. There were also silt problems exacerbated by drawn down and 
heavy metals in the river. To its credit, COE took the lead in building 
a new intake in the main stem of the Missouri in deeper water without 
silt. A number of agencies also contributed to that project. 
Unfortunately, the reservation still faces an extremely undersized 
water treatment plant and pipelines. The present day needs on this 
large reservation are about 8 million gallons a day and future needs 
are estimated at 12 million gallons a day. Their present water 
treatment plant and pipelines can only handle 1.2 million gallons a 
day. As a result, there is a moratorium on the construction of any new 
homes. This is a reservation where there are often two or three 
families living under one roof. When they have a fire on the 
reservation the water system is depleted immediately. In the short 
term, we must rebuild the core of the system--an untreated water line, 
a water treatment plant, and a treated water line. This is an important 
issue for public health, safety, and the economic needs of the 
reservation. There was an authorization in the last Water Resources 
Development Act bill of $65 million under the COE's Environmental 
Infrastructure program, but it has not been funded. Recently, USDA 
Rural Development awarded a large grant/loan package to the tribe to 
start this project, but Rural Development doesn't have enough money to 
complete the entire project. In the same way that we had a multi-agency 
approach with the intake, I want to ask if you will consider 
participating on a multi-agency approach in the future. Rural 
Development has taken the lead but I wish to see COE and other agencies 
also play a role. Will you do so?
    Answer. At my request, the Omaha District Tribal Liaison will 
contact you to ensure that we remain current on the status of your 
efforts to address these concerns. However, COE has three main 
missions:
  --flood and storm damage reduction;
  --commercial navigation; and
  --aquatic ecosystem restoration.
    Because environmental infrastructure projects fall outside of these 
missions, they do not compete well for COE funding given the many other 
needs across the country that are within the COE's primary mission 
areas.
                                 ______
                                 
            Questions Submitted by Senator Mary L. Landrieu

                  coe deg.LEVEE CERTIFICATION

    Question. There is no question that my State understands the 
critical need for sound levees that are reliable and provide the best 
protection possible for our community. In many ways, what we 
experienced in Katrina and Rita was a preview for the rest of the 
Nation of just how vulnerable we are. Approximately 700 counties across 
the country are home to thousands of miles of levees. Most of these 
levees were built a generation ago and were designed and engineered at 
a time when the satellites and GPS were just a dream. After decades of 
relying on older technology, U.S. Army Corps of Engineers (COE) and 
Federal Emergency Management Agency (FEMA) have arrived in 
communities--large and small--with new a standard for levee 
certification. These communities are very concerned with the 
significant consequences of having to meet the standards. For some 
communities it presents a stark choice: find the money to repair and 
update these levees or drive up the insurance rates to unsustainable 
levels.
    General Van Antwerp, what information and technology is COE using 
to certify these levees?
    Answer. Participation in the National Flood Insurance (NFIP) is a 
decision of the local community. It is a local community's 
responsibility to provide FEMA documentation that a levee meets NFIP 
criteria for flood mapping purposes. There are three cases in which COE 
may perform a NFIP levee system evaluation:
  --If the levee is operated and maintained by COE;
  --If it is part of an ongoing COE project; or
  --If funding was provided by another Federal agency or by a local 
        sponsor and it has been demonstrated that COE is uniquely 
        equipped to perform the work and that such services are not 
        reasonably and quickly available through ordinary business 
        channels.
    For situations in which COE is performing a NFIP levee system 
evaluation, it will follow procedures in Engineer Circular (EC) 1110-2-
6067, ``USACE Process for NFIP Levee System Evaluation''. The processes 
in this EC only apply to COE when performing levee evaluations for NFIP 
purposes. Other entities may still follow the requirements in title 44 
of the Code of Federal Regulations, section 65.10 (44 CFR 65.10), 
Mapping Areas Protected by Levee Systems; however, the EC is consistent 
with and founded on the principles of 44 CFR 65.10 while updating 
methods and references to current COE practices and criteria.
    Question. Does this take into account the assessments and 
evaluation made by the local sponsors?
    Answer. Yes, all best-available information will be considered 
during the analysis.
    Question. What resources, if any, are available to assist local 
communities in meeting these standards?
    Answer. COE and FEMA work closely together with the local 
communities to ensure the most accurate and current levee information 
is available to them and to identify how this information informs the 
NFIP mapping process.
                                 ______
                                 
                Questions Submitted by Senator Jack Reed

                     coe deg.PANAMA CANAL

    Question. As you know, the expansion of the Panama Canal expansion 
is due to be completed in 2014. Several east coast ports are vying for 
Federal funding to deepen their channels or make other improvements in 
order to handle larger Post-Panamax vessels, which require 48 feet of 
depth and higher air drafts.
    What are the economic opportunities that will come from the 
expansion of the Panama Canal?
    Answer. It is difficult to say what overall effect this 2014 lock 
opening will have on the U.S. economy, or what opportunities it may 
provide.
    Question. Do these opportunities warrant the deepening of all east 
coast ports that currently serve Panamax vessels so that they can 
accommodate Post-Panamax ships?
    Answer. Probably not, at least not at this time. The ports make the 
initial business decision to pursue large capital investments necessary 
to take advantage of the post-Panamax shipping opportunities. The Corps 
of Engineers (COE) evaluates requests to deepen, widen, or lengthen 
channels to estimate the costs and benefits to the Nation of the 
proposal.
    Question. How is COE choosing to make its investments in port 
projects related to the Panama Canal expansion?
    Answer. Most of the funding in COE coastal navigation program is 
not related to the opening of the Panama Canal lock. However, on the 
Atlantic and gulf coasts, several ports are working with COE on 
proposals to deepen and widen their channels to accommodate the largest 
of the post-Panamax vessels, which will be able to reach them more 
directly after the new locks on the Panama Canal open in 2014. On the 
Atlantic coast, the United States now has two ports with channels deep 
enough to receive these ships when they are fully loaded (Norfolk and 
Baltimore) and will have a third (New York/New Jersey) by 2014 based on 
the current COE construction schedule. The United States also has 
several other ports with depths of 45 feet on the Atlantic and gulf 
coasts, which these vessels can use when less than fully loaded.
    The President's fiscal year 2012 budget includes $65 million for 
the ongoing deepening of the port of New York/New Jersey; $42 million 
for construction/expansion of dredged material placement facilities at 
the ports of Norfolk, Virginia; Savannah, Georgia; and both 
Jacksonville and Tampa, Florida, in order to continue maintenance of 
the deep draft channels serving these ports; $600,000 for 
preconstruction engineering and design of Savannah's harbor expansion, 
Georgia; and $726,000 for a channel improvement study at Brazos Island 
Harbor (Brownsville), Texas.
    Question. Is there any coordination with the Department of 
Transportation (DOT), the Department of Commerce, and other Federal 
agencies in selecting the ports that should be deepened or in making 
related infrastructure investments (highways, rail, etc.) that support 
deepening projects?
    Answer. Yes. For example, COE is working with the DOT to improve 
decisionmaking on Federal investment in coastal navigation 
infrastructure through better coordination. DOT is providing 
information on previous years' selected TIGER Grant recipients to COE, 
which we will be considering as part of the Civil Works budget 
preparation. Similarly, the DOT has invited COE technical experts to 
advise it during the upcoming review process for next year's TIGER 
Grant selections. Our staffs are also working on common metrics for 
comparing potential investments that support coastal navigation, and 
for evaluating the performance of those investments.
    Question. If it is found that significant new private sector 
revenue will be generated from the taxpayer investment in port 
deepening projects related to the Panama Canal's expansion, would it 
make sense, in these tight fiscal times, to finance these projects 
through a Federal loan or loan guarantee program (perhaps through an 
infrastructure bank)?
    Answer. There may be advantages to such an approach, as an option 
in lieu of the traditional cost-sharing. Many ports can borrow or raise 
funds on their own. A Federal program like an infrastructure bank, in 
which proposed investments, at ports and elsewhere, compete with each 
other for support based on their return to the Nation, could be used 
where needed to catalyze public and private sector investment.
                                 ______
                                 
                Questions Submitted to Michael L. Connor
            Questions Submitted by Senator Dianne Feinstein

            bor deg.INDIAN WATER RIGHTS SETTLEMENT

    Question. You have proposed a new account for these Indian Water 
Rights Settlements. How much mandatory funding accompanies the $51.5 
million in discretionary funding you have proposed for fiscal year 
2012?
    Answer. Title VII of the Claims Resolution Act of 2010 (Public Law 
111-291) (CRA) provides $60 million in mandatory funding for each of 
fiscal years 2012-2014 for the Reclamation Water Settlements Fund, 
which was established in the Public Land Management Act of 2009 (Public 
Law 111-11). Mandatory funding for the Navajo-Gallup Water Supply 
Project in the amount of $60 million described above is included in the 
Indian Water Rights Settlement Account in the President's fiscal year 
2012 budget.
    CRA also provided mandatory funding in fiscal year 2011 for four 
other Indian water settlements. The Bureau of Reclamation (BOR) is in 
discussions with the tribes in the four new settlements to develop 
contract and engineering plans for the use of the mandatory funds. Once 
the contracts have been agreed to and engineering plans have been 
developed, BOR will be able to develop a construction timetable and 
thereby develop proposals for the use of the funds.
    Question. Where is the funding coming from within your program for 
the Indian Water Rights Settlements?
    Answer. CRA provides $444.9 million in mandatory funding and 
authorizes $244.4 million in discretionary funding to BOR in the four 
Indian water rights settlements within CRA. As well, for each of the 
fiscal years from 2012-2014 CRA also provides $180 million in mandatory 
funding, or $60 million each year, for the Navajo-Gallup Water Supply 
Project to accompany the authorization of appropriations of $870 
million in title X of Public Law 111-11.
    Specifically, for BOR, title III--the White Mountain Apache Tribe 
Water Rights Quantification appropriates $152.7 million in mandatory 
funding and authorizes $11 million in discretionary funding; title IV--
Crow Tribe Water Rights Settlement appropriates $219.8 million in 
mandatory funding and authorizes $158.4 million in discretionary 
funding; title V--Taos Pueblo Indian Water Rights appropriates $16 
million in mandatory funding and authorizes $20 million in 
discretionary funding; and title VI--Aamodt Litigation Settlement 
appropriates $56.4 million in mandatory funding and authorizes $55 
million in discretionary funding.
    Question. Do the Water Rights Settlements require specific funding 
amounts annually?
    Answer. There are no specific dollar amounts that are required for 
each year in the legislation but there are timeframes which are 
specified for settlement implementation. The amounts requested are 
based on capability as determined by the scope of the work that is 
expected to be performed within CRA.
    Question. What is the nature of the projects that these funds will 
be used for? Aren't they rural water systems?
    Answer. Each of the four settlements in CRA authorizes the 
construction of various projects, principally water construction 
projects. CRA requires BOR to:
  --Construct a Rural Water System for the White Mountain Apache Tribe;
  --Rehabilitate the Crow Irrigation Project and to construct a 
        Municipal, Rural and Industrial Water System for the Crow Tribe 
        Water Rights Settlement;
  --Provide financial assistance in the form of grants on a 
        nonreimbursable basis to eligible non-Pueblo entities for the 
        construction of Mutual Benefit projects, primarily groundwater 
        projects for the Taos Pueblo Indian Water Rights Settlement; 
        and
  --Construct a Regional Water System for the Aamodt Litigation 
        Settlement.
    Question. How do these projects differ from the seven on-going 
rural water projects funded in the water and related resources account?
    Answer. CRA authorized the Secretary to enter into Settlement 
Agreements with specific tribes and to undertake the specific actions 
included in those Settlements. One key difference is that the projects 
authorized under CRA settle claims against the United States through 
negotiated settlements. If project and financial timelines are not met, 
the negotiated settlements may be terminated. Not only are the 
significant investments of time and funding associated with negotiating 
the settlements at risk, but underlying these settlements is the 
quantification of tribal water rights. If the settlements fail, the 
tribal water rights are not quantified and the communities affected 
would revert to the prior state of uncertainty with respect to the 
quantification and the effect of Federal tribal rights on State-based 
rights. The rural water projects also address water supply needs and 
provide regional drinking water systems. However, the United States 
does not face the same legal burden in meeting those future needs as it 
does with respect to meeting the obligations associated with the 
settlements authorized under CRA.
    Question. Can these new projects proposed for funding in fiscal 
year 2012 utilize all of the discretionary funding recommended in 
fiscal year 2012?
    Answer. BOR expects to use all of the discretionary funds that are 
being requested as well as some of the mandatory funding that is made 
available within the CRA. In fiscal year 2012, BOR is requesting $51.5 
million in discretionary funding in the Indian Water Rights Settlement 
account, of which $24.8 million is directed to the Navajo-Gallup Water 
Supply Project. The balance of the discretionary request, or $26.7 
million, is for the remaining four new settlements.
    Question. Why did the seven ongoing projects compete so poorly in 
the fiscal year 2012 budget compared to these four new projects?
    Answer. The seven ongoing rural water projects did not compete for 
funding with the tribal settlements that are funded within the CRA. 
These projects have separate authorizations and are at widely varying 
points in their completion schedules. BOR prioritizes funding for its 
ongoing (authorized) rural water projects based on established 
criteria. The first priority for funding rural water projects is the 
required operation and maintenance (O&M) component. For the 
construction component, BOR gives priority to projects nearing 
completion and projects that serve on-reservation needs. For BOR, CRA 
authorized and appropriated $444.9 million in mandatory funding for 
five specific tribal water settlements. The Congress also authorized 
$249.3 million in discretionary funding within the CRA.
    CRA settlements require numerous conditions that have to be 
fulfilled by the Secretary within specified dates in order to satisfy 
the terms of the agreements. If the conditions are not met, the 
settlements may fail and the parties to the settlements will likely 
return to the courts for the resolution of their grievances. The 
funding BOR requested for CRA projects is required to fulfill the terms 
of the CRA.

                      bor deg.RURAL WATER

    Question. Four of these ongoing rural water projects received 
roughly $500,000 each. Can anything constructive be done with $500,000 
for these ongoing projects? What do you anticipate to be accomplished 
with this small amount of funding?
    Answer. Funding amounts for the four rural water projects only 
reflect Federal funding and does take into account the contributed non-
Federal funding. Funds requested by BOR for fiscal year 2012 and the 
planned use of the funds are shown below:
      Fort Peck Reservation/Dry Prairie Rural Water System (Montana).--
        Funding in fiscal year 2012 will enable the tribes and the non-
        Federal sponsor, Dry Prairie, to perform a minimal level of 
        administrative business for the project; no design or 
        construction would be performed.
      Lewis & Clark Rural Water System (South Dakota, Minnesota, 
        Iowa).--Funding in fiscal year 2012 will enable the project 
        sponsor to perform a minimal level of administrative business 
        for the project; no design or construction would be performed.
      Rocky Boys/North Central Montana Rural Water System (Montana).--
        Funding in fiscal year 2012 will enable the tribe and the non-
        Federal sponsor, North Central Authority, to perform a minimal 
        level of administrative business for the project; no design or 
        construction would be performed.
      Jicarilla Apache Rural Water System (New Mexico).--Funding in 
        fiscal year 2012 continues design and construction of existing 
        water and wastewater facilities.
    Non-Federal funding for Fort Peck and Rocky Boy's has not been 
totally contributed. Non-Federal funding for Lewis & Clark will be 
fully contributed in fiscal year 2011 and non-Federal funding for 
Jicarilla has been totally contributed and exceeded.

                      bor deg.MNI WICONI

    Question. The authorization for Mni Wiconi, one of the rural water 
projects, sunsets in 2013. Will this project be completed by that date 
based on the budget request, or will the project require an 
authorization change?
    Answer. It is anticipated that the Mni Wiconi Project will be 
completed by the sunset date of 2013 if funding is provided at the 
current budget request level.

                   bor deg.NEEDS ASSESSMENT

    Question. Has BOR undertaken a needs assessment for the next 25 
years?
    Answer. BOR has multiple activities within the WaterSMART Basin 
Studies Program that are in the process of assessing future needs for 
water in the Western United States. The Basin Studies are 50/50 cost 
shared activities with non-Federal entities to assess future water 
supply and demand imbalances including the impacts of climate change. 
As part of these activities future water demand will reflect changes to 
water needs from population changes, irrigation, and changes to 
evapotranspiration from climate change as well as any other stresses on 
the system. If current or future imbalances between supply and demand 
are identified, the Basin Studies will develop adaptation and 
mitigation strategies including structural and non-structural 
opportunities within the basin.
    Through the Basin Studies Program beginning in fiscal year 2012, 
BOR will offer the opportunity to conduct feasibility studies as 
authorized by the Omnibus Public Lands Management Act (Public Law 111-
11) of 2009 with respect to adaptation and mitigation strategies 
identified through the Basin Studies or other similar appraisal level 
studies including the impacts of climate change. Also within the Basin 
Studies Program, BOR began the West Wide Climate Risk Assessments 
(WWCRAs) in fiscal year 2010. Beginning in fiscal year 2011, BOR is 
identifying changes to agricultural demands in a changing climate as 
part of the WWCRAs. In future years, the WWCRAs will explore other 
changes to water demands and needs by working with stakeholders within 
the eight major BOR river basins identified within Public Law 111-11.
    With respect to the needs of BOR's infrastructure, although a small 
number of BOR offices assess and project their individual needs 10 or 
more years into the future, there has been no comprehensive BOR-wide 
assessment covering the next 25 years. Most of BOR's assets are not 
considered ``replaceable units of property'' and, therefore, do not 
have well-defined service lives, nor are there good predictive 
estimates for such future needs. However, in September 2009, BOR 
updated its Major Rehabilitation and Replacement (MR&R) needs for a 
defined 5-year timeframe related to aging infrastructure. These needs 
have been broadly characterized as potential costs associated with 
BOR's ``aging infrastructure''.
    BOR also has planning activities underway with its rural 
communities who are pursuing rural water projects at specific locations 
throughout the West. These activities are undertaken pursuant to 
competitive criteria developed under Public Law 109-451.
    Finally, in the area of dam safety, BOR maintains an active program 
to monitor existing dams and initiate corrective actions where 
appropriate. This program helps ensure the safety and reliability of 
BOR dams to protect the downstream public and property.

               bor deg.OPERATION AND MAINTENANCE

    Question. How do you propose to address BOR's aging infrastructure 
given the decreasing Operation and Maintenance (O&M) budget?
    Answer. To address the requirements of aging infrastructure on 
projects where BOR is directly responsible for daily O&M, BOR continues 
to assess the condition of its assets and prioritizes funding to 
address requirements of greatest importance, given the current budget 
environment. The prioritization of requirements is based largely on a 
risk-based approach, evaluating not only the significance of the 
deficiency involved, but also the potential consequences should the 
activity not be undertaken.
    Through BOR's continued support of a past and current philosophy 
and emphasis on preventive maintenance and regular condition 
assessments (field inspections and reviews), many of the service lives 
on BOR assets and facilities have been extended, thereby delaying the 
need for significant replacements and rehabilitation efforts (including 
the related funding needs). Although BOR and its beneficiaries have 
benefited greatly from this preventive maintenance philosophy, BOR 
recognizes that as assets and facilities age, they require an increased 
amount of maintenance. Sometimes this requires more frequent preventive 
maintenance, and, in other situations, significant extraordinary 
maintenance, rehabilitation, or replacement may be required.
    BOR's fiscal year 2012 proposed budget is $40.8 million for various 
projects for Replacements, Additions, and Extraordinary Maintenance 
(RAX) activities across BOR. This compares to the fiscal year 2011 
enacted budget of $45.8 million. This request is central to mission 
objectives for operating and maintaining projects ensuring delivery of 
water and power benefits. BOR's RAX request is part of its overall 
Asset Management Strategy that relies on condition assessments, 
condition/performance metrics, technological research and deployment, 
and strategic collaboration to continue to improve the management of 
its assets and deal with its aging infrastructure challenges. This 
amount represents only the fiscal year 2012 request for discretionary 
appropriations. Additional RAX items are directly funded by revenues, 
customers, or other Federal agencies.

                 bor deg.AGING INFRASTRUCTURE

    Question. Public Law 111-11 provided you with authority to address 
aging infrastructure. Do you plan to budget for these projects?
    Answer. BOR is currently developing its policy to implement the 
authority provided under Public Law 111-11 to allow extended repayment 
of extraordinary (nonroutine) and emergency extraordinary maintenance 
costs on project facilities. Water users are currently required by 
Federal law to pay these costs, often substantial, in advance.
    It is important to note that much of the operation and maintenance 
(O&M) funding responsibilities for BOR's assets is the responsibility 
of our project beneficiaries and those operating entities that operate 
and maintain our transferred works facilities. For some operating 
entities and project beneficiaries, rehabilitation and replacement 
funding needs may exceed their available resources and ability to 
provide the funds in advance. In particular, many smaller irrigation or 
water conservancy districts are unable to fund these needs in the year 
incurred absent financing assistance. BOR expects to consider funding 
such projects in the future based on the policy and funding priorities 
and water user financial capability, as appropriate.

               bor deg.PRINCIPLES AND GUIDELINES

    Question. Please explain how the revised Principles and Guidelines, 
to be called the Principles and Requirements, will impact BOR's 
construction and other programs.
    Answer. The Principles and Requirements are not yet finalized and 
it is anticipated that agencies will have some level of flexibility in 
developing agency-specific guidance to allow for the achievement of 
their specific missions and authorities. Two essential differences 
between the proposed Principles and Requirements and the 1983 
Principles and Guidelines will affect BOR's planning and evaluation 
process.
    First, under the 1983 Principles and Guidelines, agencies relied 
solely on economic benefit-cost analysis to recommend a particular 
alternative for implementation. When evaluating, comparing, and 
recommending a specific alternative for implementation under the 
proposed Principles and Requirements, agencies are to fully consider 
the social, economic, and environmental effects of proposed 
alternatives before selecting the one to be recommended for 
implementation.
    Second, the proposed Principles and Requirements may apply to a 
broader scope of Federal water resource activities than the 1983 
Principles and Guidelines. This means that certain BOR programs and 
activities not previously subject to the 1983 Principles and Guidelines 
may be subject to the Principles and Requirements.

                    bor deg.CLIMATE CHANGE

    Question. What is BOR doing to address Climate Change in the West?
    Answer. BOR is addressing the stressors of climate change through a 
comprehensive set of activities, including participating in Landscape 
Conservation Cooperatives (LCCs) and Climate Science Centers (CSCs), 
providing West-Wide Climate Risk Assessments, and conducting research 
and development of climate analysis tools through the WaterSMART Grant 
and Science and Technology Programs. BOR is also supporting the 
Department of the Interior's Priority Goal for Climate through these 
activities to support the LCCs, conduct vulnerability assessments, and 
implement adaptation actions. LCCs and CSCs are an important part of 
the framework established by Secretary Salazar in Secretarial Order 
3289 to address climate change by bringing science capability to 
resource managers. BOR is conducting research through the Science and 
Technology program, which includes collaboration with the Department of 
the Interior (Department) Climate Science Centers. BOR's Science and 
Technology program also established the Climate Change and Water 
Working Group (C-CAWWG) in 2008 to partner with other Federal agencies 
to address the needs of water managers as they manage the Nation's 
water and hydropower resources under a changing climate.
    Through the Basin Study Program, which includes the Basin Studies, 
West-Wide Climate Risk Assessments, and the LCCs, BOR is conducting 
vulnerability assessments to identify the impacts of climate change to 
water resources in each of the major river basins in the West, as 
authorized under section 9503 of the SECURE Water Act (subtitle F of 
title IX of the Omnibus Public Land Management Act of 2009, Public Law 
111-11, 42 U.S.C. 10364). In April 2011, BOR submitted its first report 
under section 9503 of the SECURE Water Act regarding risks to future 
water supplies from climate change. The report, entitled ``SECURE Water 
Act Section 9503(c)--Reclamation Climate Change and Water 2011'', is 
available at http://www.usbr.gov/climate/ and identifies current 
uncertainties regarding projections of climate change risks and 
impacts, while highlighting likely significant impacts associated with 
the projected rise in temperature, changes to precipitation, reduced 
April 1 snowpack levels, and changes to both the timing and quantity of 
streamflow throughout the Western United States. The vulnerability 
assessments conducted under the Basin Study Program will contribute to 
the Department's Priority Goal for Climate Change. Additionally, in 
fiscal year 2011, BOR identified a number of adaptation actions (e.g., 
WaterSMART Water and Energy Efficiency Grants, Bay Delta Conservation 
Plan, retrofitting of Hoover Dam to wide-head turbines, and Pilot Run 
of the Yuma Desalting Plant) being conducted to adapt to stressors 
within the Western United States, including those from climate change. 
These adaptation actions will also contribute to the priority goal and 
span a wide array of BOR's mission responsibilities from water supply 
planning efforts, retrofitting of hydropower turbines, to the 
restoration of rivers and ecosystems.

                     bor deg.SECURE WATER

    Question. What guidance documents exist for implementing the 
Cooperative Watershed Program and the SECURE Water Act?
    Answer. The Cooperative Watershed Management Act, subtitle A of 
title VI of the Omnibus Public Land Management Act (Act) of 2009 
(Public Law 111-11), authorized the Department of the Interior 
(Department) to provide financial assistance to establish and expand 
collaborative watershed groups. The act authorizes direct financial 
support for the operations of a collaborative watershed group, as well 
as watershed project funding, including restoration projects. The act 
calls for the Department to establish an application process for the 
program and prioritization and eligibility criteria for considering 
applications, in consultation with the States.
    In the summer of 2010, the Department received input from the 
States regarding the program processes and criteria in response to a 
questionnaire. The fiscal year 2012 President's budget requests 
$250,000 to implement the CWMP through a funding opportunity. The 
funding opportunity announcement will describe the proposal selection 
process and criteria, taking into consideration the early feedback 
received from the States. BOR expects to post the draft funding 
opportunity announcement in the Federal Register later this year in 
order to solicit additional public comments on the proposed selection 
process and criteria. The funding opportunity announcement will then be 
revised, as needed, based on comments received and will be posted on 
www.grants.gov before the end of 2012. The funding opportunity 
announcement will be the first document describing program processes 
and procedures. Additional guidance will be developed as program 
implementation begins.
    Section 9503 of the SECURE Water Act (subtitle F of title IX of the 
Omnibus Public Land Management Act of 2009), authorizes BOR to assess 
the risks and impacts of climate change to water resources, identify 
adaptation strategies, and provide financial assistance for feasibility 
studies. BOR implements section 9503 through complementary activities 
within the WaterSMART Basin Study Program and Science and Technology 
program. This comprehensive approach allows BOR to incorporate the 
best-available science--through coordination with science agencies--
into climate change adaptation planning with stakeholders. The Basin 
Study Program activities include the West-Wide Climate Risk 
Assessments, the Basin Studies, and the Landscape Conservation 
Cooperatives. Guidance related to each of these activities is available 
through program specific links on BOR's Basin Study Program Web site at 
www.usbr.gov/WaterSMART/basinprogram. A document entitled ``Basin Study 
Program Framework'', available at the aforementioned Web site, provides 
an overview of the Basin Study Program and specifically describes the 
process for conducting a Basin Study. Additionally, in April 2011, BOR 
submitted its first report to the Congress under section 9503 of the 
SECURE Water Act, identifying the risks to future water supplies as 
well as potential changes in demands and impacts on BOR's mission 
responsibilities from climate change. The report, entitled ``SECURE 
Water Act Section 9503(c)--Reclamation Climate Change and Water 2011,'' 
is available at http://www.usbr.gov/climate/and provides a 
comprehensive explanation of BOR's activities (including primarily the 
West-Wide Climate Risk Assessments) that contributed to the report.

              bor deg.BAY-DELTA INTERAGENCY PLAN

    Question. Are there remaining interim Federal Bay-Delta Interagency 
action plan items that are unfunded and if so, how will they be funded?
    Answer. Implementation of the four elements of the Interim Federal 
Action Plan (IFAP) is a multi-year process. Multiple Federal agencies 
are strategically aligning resources to implement the IFAP. To date, 
BOR has funded programs and projects to support those elements of the 
IFAP that are within BOR's purview. Funding in the future is subject to 
appropriations. Budget requests will be submitted as appropriate and 
will continue to be a priority for BOR in the future. Potential funding 
sources include, but may not be limited to Water and Related Resources, 
California Bay-Delta Restoration, and Central Valley Project 
Restoration Fund.

                   bor deg.TITLE XVI PROGRAM

    Question. These projects are critical to providing additional water 
sources to many western communities, including many communities in 
California. Is there more that BOR can do to assist in these programs?
    Answer. Water reuse projects are a critical aspect of water supply 
sustainability in the West. By improving efficiency through reuse, 
title XVI projects provide flexibility during water shortages and help 
to diversify the water supply. On May 23, 2011, BOR selected eight 
congressionally authorized projects to receive approximately $11.3 
million in fiscal year 2011 title XVI construction funding. In 
addition, recently BOR invited sponsors of potential new water 
recycling projects to apply for cost-shared funding to develop new 
title XVI feasibility studies. On May 9, 2011, after applying program 
criteria to funding applications submitted by non-Federal sponsors, BOR 
selected eight entities who will leverage $1.1 million in Federal 
funding to complete $4.9 million in studies of new water reuse 
projects.
    Question. What is the backlog of unfunded projects?
    Answer. For previously authorized title XVI projects, the remaining 
authorized Federal cost-share totals approximately $595 million once 
fiscal year 2011 funding has been applied. BOR is currently working to 
gather information from project sponsors to determine whether any 
projects have smaller costs than expected, in which case Federal cost-
share may require adjustment, and to refine estimates of each project 
sponsor's construction plans over the next few years. Once additional 
communications with sponsors have been completed, BOR will have an 
updated estimate of the remaining Federal cost-share for authorized 
projects.
    Question. How many separate projects are authorized, and of these 
does BOR have an opinion on the viability of the individual projects?
    Answer. There are currently 53 authorized title XVI projects. We 
are developing a list of authorized projects that sponsors are not 
planning to pursue with new or additional construction at this time.
    Question. Why don't these projects compete well within the 
administration budget?
    Answer. Water reuse through the title XVI program is a key aspect 
of the Department's WaterSMART program. The President's fiscal year 
2012 budget, which includes $29 million for such projects, points to 
the crucial role of water reuse in efforts to address water supply 
sustainability and represents a significant increase over funding 
levels for the program in recent years.
    Question. Has placing these projects under the WaterSMART Program 
given them more or less visibility within the BOR budget?
    Answer. By incorporating the title XVI program into WaterSMART, the 
Department has been able to articulate the role of water reuse in 
efforts to stretch the limited water supplies in the West. The fiscal 
year 2012 budget request builds on lessons learned in other programs 
such as WaterSMART Grants, including the use of funding opportunities 
that incorporate prioritization criteria to identify projects that most 
closely match program goals. Through the use of such funding 
opportunities, project sponsors have a chance to communicate to BOR the 
expected benefits of each project--how each project can be expected to 
contribute to water supply sustainability, benefits to the environment 
and water quality, and any contributions to increased energy efficiency 
in the delivery of water, among others.
    The Department's coordinated approach to addressing water supply 
sustainability issues in ways that maximize the benefits of Federal 
funding extends beyond title XVI and existing WaterSMART Grants. This 
year as part of WaterSMART, for example, BOR and USDA's Natural 
Resources Conservation Service (NRCS) worked together on an innovative 
funding opportunity to leverage funding for water delivery agencies and 
agricultural producers in California's Central Valley. BOR announced 
its selection of five Bay-Delta Agricultural Water Conservation and 
Efficiency Projects for funding, totaling $4.2 million, on May 18, 
2011. The selected projects will increase district-level efficiencies 
through BOR funding and also facilitate water conservation and/or water 
use efficiency on farms. NRCS will provide up to an additional $5 
million in funding and technical assistance to growers in the selected 
districts for eligible on-farm conservation practices.
    Title XVI projects, along with WaterSMART Grant projects, are also 
included as part of the Department's Priority Goal for Water 
Conservation, which provides additional visibility.

           bor deg.SOUTH OF DELTA WATER ALLOCATIONS

    Question. As you know, I and many others have been closely 
following the BOR's water allocation for south-of-Delta water users in 
California's Central Valley. I was pleased to learn of BOR's decision 
last week to increase the allocation for farmers from 65 percent to 75 
percent of their service contract. This followed two previous rounds of 
increases in recent weeks. However, there remains a great deal of 
frustration and consternation in California as to why BOR is unable to 
provide 100 percent of the allocation given the historic level of snow 
and rainfall we have experienced this year. Do you expect to increase 
the allocation of water supplies to south-of-Delta users again this 
year? If so, do you believe that you will ultimately be able to 
announce a 100 percent allocation?
    Answer. On April 8, 2011, BOR increased the allocations for the 
south-of-Delta agricultural project water users from 65 percent to 75 
percent, and on April 25, from 75 percent to 80 percent.
    The most probable runoff forecast for this water year shows that we 
will be in the upper quartile of the historical annual volumes. We are 
currently analyzing the runoff forecast and are preparing our forecast 
of CVP operations. Our studies should be completed later this summer 
and a determination will be made about further increases to the 
allocation. With the current operational constraints, it may not be 
possible to achieve 100 percent allocation this contract year. Factors 
affecting BOR's ability to declare a 100 percent allocation for the 
south of Delta agricultural water users include the actions required by 
the biological opinions to avoid jeopardizing listed species and 
project operations.
    BOR has been able to utilize flood flows that have reached Mendota 
Pool to supplement the water supply to the extent that the flood flows 
can be forecasted. We have also been able to augment the allocated 
water supply with water that the districts rescheduled from contract 
year 2010 and supplemental water exported from the Delta between March 
1 and May 8. With these additional water supplies, the total delivery 
to the south-of-Delta agricultural water users will exceed the volume 
of an 80 percent allocation.

        bor deg.CENTRAL VALLEY PROJECT RESTORATION FUND

    Question. After nearly 20 years what is the status of the Central 
Valley Project Restoration Fund in addressing the goals of the Central 
Valley Project Improvement Act?
    Answer. The Central Valley Project Improvement Act (CVPIA) Activity 
Report (CPAR), dated August 25, 2009, and made public in December 2009, 
provides a detailed report on the status of restoration activities. In 
general the report identifies a number of activities that have been 
completed under the CVPIA and remaining activities which are yet to be 
completed. The fiscal year 2010 ``Annual Accomplishment Report to 
Congress'' will provide an update on the status of all CVPIA program 
activities and will be available to the Congress and the public before 
the end of 2011.
    Question. How much funding has been expended to date for these 
purposes?
    Answer. From fiscal year 1993 through fiscal year 2009 the Program 
has expended just more than $972 million for program implementation:
  --$599.5 million--Restoration funds;
  --$290.9 million--Water and related resources;
  --$76.2 million--State of California cost share;
  --$5.3 million--California Bay Delta Restoration; and
  --$29,000--American Recovery and Reinvestment Act.
    Question. Do you have an estimate as to when this program would be 
complete?
    Answer. The CVPIA fish and wildlife restoration program is 
comprised of two broad types of activities: those with endpoints (e.g., 
structural fish restoration actions and fish screens); and those that 
are annual ongoing (e.g., instream flow management, gravel 
replenishment, scientific monitoring and wildlife refuge incremental 
level 4 water acquisition and conveyance. The annual ongoing activities 
are expected to occur in perpetuity and thus completion dates do not 
apply. The activities with endpoints will attain completion however 
those dates have not been established since their implementation is in 
some cases beyond the long-range planning timeframe of the next 10 
years. Therefore, no date has been set for the reduction in Restoration 
Fund collections from water and power contractors since the reduction 
is contingent upon completion of activities with endpoints. See the 
CVPIA Program Activity Review Report (CPAR, 2009) for more information 
on program performance measures and completion criteria.
    Question. Is there a better way to allocate the collection of fees 
among the users?
    Answer. BOR is required per CVPIA section 3407(c)(2) to collect $50 
million per year for the Restoration Fund (indexed to about $76 million 
in current dollars). Because other CVPIA revenues have not been as high 
as anticipated, BOR has been required to assess the maximum mitigation 
assessment required by CVPIA. This assessment is paid by water and 
power contractors and is capped at $30 million annually (indexed to 
about $46 million in current dollars).
    Although BOR cannot require its water contractors to pay additional 
annual payments in excess of the CVPIA designated amounts of $6 and 
$12, respectively, per acre-foot (October 1992 dollars) for agriculture 
and municipal and industrial water users, respectively, there is no 
comparable limitation on the amount paid by power contractors. 
Consequently, when BOR must collect $30 million (October 1992 dollars) 
in charges, it has no discretion but to collect the balance from its 
CVP power contractors.
    CVPIA did not authorize BOR to collect less than $50 million per 
year (unless activities are completed) or to collect more from water 
contractors. Through fiscal year 2009 (based on a 10-year rolling 
average), power contractors have paid about 32.7 percent of all 
collections into the Restoration Fund with the balance paid by water 
users.
    Question. Are there other ways to improve fee collections into the 
fund?
    Answer. These financial obligations, issues, and impacts are being 
examined in detail in an ongoing comprehensive evaluation that BOR is 
preparing in collaboration with Western Area Power Administration that 
is addressing the following areas:
  --Identification of the activities and projects that have met 
        prerequisites for completing the remaining requirements, and 
        the impact on future water and power contractor collections. 
        (CVPIA allows reducing collections from contractors once 
        activities are complete.)
  --An evaluation of BOR's discretion and flexibility regarding 
        financial obligations and funding under the law.
  --An evaluation of the CVPIA reimbursability requirements and BOR's 
        discretion related to repayment requirements.
  --An assessment of the extent to which CVPIA's financial collection 
        mechanisms have resulted in anticipated Restoration Fund 
        revenues, along with any problematic consequences.
  --An assessment of options for assessing and collecting funds for 
        reimbursable activities if and when the costs exceed 
        contractors' credits.
    BOR recognizes that the financial viability of the CVP hinges on 
the availability and marketability of a reliable and competitive source 
of power plans to complete the above-mentioned evaluation by December 
2011. BOR staff has met with representatives of the Northern California 
Power Association and the Central Valley Project Water Association to 
ensure their concerns are addressed as part of the evaluation. BOR is 
committed to working with our stakeholders to address concerns about 
CVPIA.

                        bor deg.CALFED

    Question. As you know, the Bay Delta Conservation Plan is a joint 
effort of Federal and State water agencies, environmental organizations 
and other water users to plan and implement an environmental permitting 
process that will restore habitat for Delta fisheries and insure 
reliable water deliveries to 25 million Californians. The goal of the 
Bay Delta Conservation Plan is to devise a 50-year plan of water system 
and ecosystem improvements, and environmental law compliance through 
adaptive management. It will still likely take 10 to 15 years to 
complete the projects necessary to increase water deliveries south of 
the Delta. Until the plan is fully implemented, I fear that farmers 
will continue to struggle to receive enough water.
    Can you please provide me with an update on BOR's efforts to help 
develop a Programmatic Environmental Impact Statement for the Bay Delta 
Conservation Plan?
    Answer. Federal agencies are fully engaged in developing the Bay 
Delta Conservation Plan (BDCP). The three lead agencies, Department of 
the Interior, through BOR and the U.S. Fish and Wildlife Service (FWS) 
and the Department of Commerce, through the National Oceanic and 
Atmospheric Administration's National Marine Fisheries Service (NMFS) 
together with COE and the U.S. Geological Survey have significantly 
enhanced Federal engagement on the BDCP. BOR has and will continue to 
provide expertise throughout the BDCP process to ensure Central Valley 
Project (CVP) operations and water deliveries are considered, 
evaluated, and addressed. BOR will evaluate the BDCP in consideration 
of CVP statutory and contractual obligations. BOR expects to pursue 
section 7 consultation with NMFS and FWS for CVP operations as part of 
the BDCP process.
    BOR serves as a Federal co-lead agency in preparation of the BDCP 
Environmental Impact Report/Environmental Impact Statement (EIR/EIS). 
The BDCP EIR/EIS will include both programmatic and project-specific 
analyses in compliance with National Environmental Policy Act (NEPA) 
and California Environmental Quality Act (CEQA) requirements. 
Preparation of the EIR/EIS has slowed since the beginning of 2011 to 
allow further formulation and development of the BDCP including 
identification of the BDCP proposed Project. Federal lead agencies are 
coordinating with the new State administration and a revised schedule 
for completion of both the BDCP and the associated EIR/EIS is currently 
under development. The BDCP EIR/EIS will identify and analyze potential 
environmental impacts of permitting and implementing the BDCP Proposed 
Project as well as alternatives to the Proposed Project. Therefore, the 
EIR/EIS schedule must track with identification of the BDCP Proposed 
Project.
    Question. What are the greatest challenges you (anticipate) in 
completing the Programmatic Environmental Impact Statement and 
implementing the Plan?
    Answer. Challenges to complete the EIR/EIS for the BDCP include 
finalizing the identification of a proposed Project for the BDCP; 
gaining multi-agency support for the effects analysis methodology; 
gaining agreement on an array of alternatives to be analyzed in the 
EIR/EIS; determining future governance strategies; determining short-
term construction and long-term financing strategies.
    Question. Are there small projects, statutory changes or 
administrative actions that can be taken in the 10- to 15-year interim 
period before the Plan is fully implemented that will allow for 
increased water deliveries to south-of-Delta users?
    Answer. Actions that could be implemented in the next 10-15 years 
will be addressed in a near-term plan, which is being discussed as part 
of the development of the BDCP.

             bor deg.SAN JOAQUIN RIVER RESTORATION

    Question. As the author of the San Joaquin River Restoration 
Settlement Act, I have a keen interest in BOR's implementation of 
various programs the legislation authorized. I know that the Settlement 
is also an important priority for BOR, but the administration has never 
requested the level of new appropriations in the early years needed to 
ensure full implementation. Full funding benefits all parties:
  --the Friant Water Users;
  --the third-party landowners; and
  --numerous interests seeking full restoration of the river.
    When do you expect to release the San Joaquin River Restoration 
Programmatic Environmental Impact Statement?
    Answer. BOR released the Draft Program Environmental Impact 
Statement/Report (Draft PEIS/R) for the San Joaquin River Restoration 
Program (Restoration Program) for public review on April 22, 2011. The 
60-day public comment period ended on June 21, 2011. The Draft PEIS/R 
analyzes and discloses the direct, indirect, and cumulative impacts of 
implementing the Stipulation of Settlement in NRDC, et al., v. Rodgers, 
et al., (Settlement) consistent with the requirements of NEPA and the 
State equivalent to NEPA-CEQA. BOR is the NEPA lead agency and the 
California DWR is the CEQA lead agency for the document. BOR 
anticipates completing the Final PEIS/R in early fiscal year 2012 and 
signing a Record of Decision shortly thereafter.
    Question. What is your plan to ensure sufficient funding to meet 
the timeline for completing San Joaquin River restoration projects that 
are called for in the settlement and the Programmatic EIS?
    Answer. We recognize that some actions required by the Settlement 
are unavoidably behind schedule. This includes certain channel and 
structural improvement projects that may be beneficial for successful 
reintroduction of salmon. We are initiating consultation with the 
parties to the Settlement to develop a new schedule based upon the 
recently released Draft PEIS/R. This new schedule will assure 
implementation of the Restoration Program in a manner that addresses 
the requirements of the Settlement for expeditious action while meeting 
the requirements of the legislation to minimize impacts on third-party 
interests. A revised funding schedule will be formulated once a new 
settlement schedule has been developed. Funding for the Restoration 
Program will remain a priority as we proceed with the program's 
implementation. The fiscal year 2012 budget requested $9 million for 
this program.
    Question. The Settlement Act required BOR to establish a 
``Recovered Water Account'' to allow Friant contractors to obtain 
additional water for storage during wet years. I understand that BOR 
has recently made a decision regarding the ``Recovered Water Account'' 
that may help provide some additional supplies to Central Valley 
farmers this year. Can you please explain?
    Answer. On October 23, 2006, the U.S. Eastern District Court of 
California approved the Stipulation of Settlement in NRDC et al. v. 
Kirk Rogers, et al. Under paragraph 16(b), the Settlement requires BOR 
to develop a Recovered Water Account to monitor and record reductions 
in water deliveries occurring as a result of the Settlement and make 
water available at a total cost of $10 per acre-foot to contractors who 
experience a reduction in water deliveries as reflected in their 
Recovered Water Account. Recovered Water Account water is to be made 
available during wet hydrologic conditions, when water is not otherwise 
required to meet other obligations of the Secretary of the Interior.
    In 2010, the Friant Division long-term contractors did not 
experience substantial reductions in water deliveries as a result of 
the Settlement and thus, had relatively low balances in their Recovered 
Water Accounts. Since early 2011, the San Joaquin Basin has been 
experiencing wet hydrologic conditions and water is available in 
Millerton Lake that is not otherwise needed to meet other obligations 
of the Secretary of the Interior. In response to this condition, in 
early April, BOR credited an additional 460,000 acre-feet to the Friant 
Division long-term contractors Recovered Water Accounts. The 460,000 
acre-feet of credits were based on a projected average water supply 
impact for 2012 to 2015. The credits were allocated to Class 1 and 
Class 2 contractors in proportion to anticipated impacts and contract 
amounts. With the allocation of 460,000 acre-feet of credits, BOR also 
made Recovered Water Account water available to each contractor 
accordingly.
    Consistent with the Settlement, the Recovered Water Account water 
is made available at a total cost of $10 per acre-foot. This relatively 
low-cost water provides a source of water for groundwater banking and 
other activities that will assist the Friant Division long-term 
contractors in avoiding future impacts of the Settlement. With the 
allocation of 460,000 acre-feet of credits and making this Recovered 
Water Account water available, BOR has worked to avoid some of the 
future water supply impacts that may occur with the implementation of 
the Settlement.

                 bor deg.LAKE POWELL/LAKE MEAD

    Question. I understand that yesterday, BOR announced that it will 
release an additional 3.33 million acre-feet of water from Lake Powell 
to Lake Mead based on significant snowpack in the Upper Basin of the 
Colorado River. Combined with previous releases totaling 8.23 million 
acre-feet, that will bring the total to 11.56 million acre-feet this 
year. Unfortunately though, because of the prolonged drought we have 
experienced, I suspect we have a long way to go before we refill Lake 
Mead. Can you tell me about how much water we will now have in Lake 
Mead and how far does this get us in terms of recovering from the many 
years of drought?
    Answer. Glen Canyon Dam is projected to release approximately 12.46 
million acre-feet (MAF) from Lake Powell to Lake Mead, which represents 
an additional 4.23 MAF of water this water year (October 1-September 
30) for Lake Mead. At the end of the water year BOR projects that Lake 
Mead will have approximately 12.87 MAF of water in storage 
(approximately 50 percent full). Projected releases from Glen Canyon 
Dam are updated monthly throughout the year to reflect changing 
hydrology.
    In terms of drought recovery, it is challenging to quantify because 
it is largely dependent on future hydrology; it is not uncommon to have 
short periods of high annual runoff from the Rocky Mountains during 
extended drought periods.
    Due to this year's higher inflow, BOR projects the first occurrence 
of shortage in the lower Colorado River Basin could be in 2015, at a 5-
percent probability. At this time last year, BOR had projected an 8-
percent chance of shortage as early as 2012.
    Question. How much storage capacity remains in Lake Mead?
    Answer. Discounting exclusive flood control space (approximately 
1.5 MAF), Lake Mead has an available capacity of 25.877 MAF. By 
December 31, 2011, BOR projects that Lake Mead will have 13.973 MAF of 
water in storage, which will take up 54 percent of its available 
storage capacity. At this level the remaining unused storage capacity 
at Lake Mead will be 11.904 MAF (46 percent of Lake Mead's total 
available capacity).

      bor deg.IMPERIAL, COACHELLA, AND METROPOLITAN WATER

    Question. What do these additional waters mean in terms of 
deliveries to lower Colorado River users, particularly those in 
California:
  --the Palo Verde Irrigation District;
  --Imperial Irrigation District;
  --Coachella Valley Water District; and
  --the Metropolitan Water District of Southern California.
    Answer. The amount of water available to be delivered to water 
contractors in the Lower Basin, including California contractors, is 
dependent on the condition determined for the operation of Lake Mead 
under the 2007 Record of Decision for Colorado River Interim Guidelines 
for Lower Basin Shortages and the Coordinated Operations for Lake 
Powell and Lake Mead (Interim Guidelines). The operating condition is 
determined based on reservoir elevations projected for January 1 of the 
upcoming year. In 2011, the Secretary has determined that the operating 
condition is Intentionally Created Surplus (ICS). This determination 
will not change due to the increased flow into Lake Mead. Current 
projections for 2012 and 2013 indicate that the most probable operating 
condition will once again be in the Normal--ICS Surplus range, with up 
to a 30 percent chance of a Surplus Condition in 2013.
    The Secretary has the discretion to declare either a Normal or 
Surplus Condition when Lake Mead elevations are between 1,075 feet mean 
sea level (MSL) and 1,145 feet MSL. During a Normal Condition, water 
contractors are allowed to take delivery of their full entitlement. In 
an ICS Surplus Condition, water contractors may take delivery of their 
full entitlement plus delivery of Intentionally Created Surplus water, 
up to the limits allowed under the Interim Guidelines. If over the next 
few years the elevation of Lake Mead were to increase above 1,145 feet 
MSL, this would trigger a Surplus Condition. Those contractors with a 
surplus entitlement would be allowed to take delivery of their surplus 
entitlement up to limits established in the Interim Guidelines in 
addition to a full entitlement.

                     bor deg.QUAGGA MUSSEL

    Question. In January 2007, quagga mussels were detected in Lakes 
Mead and Mohave within the Lake Mead National Recreation Area. Since 
then, Federal, State, and local agencies have been working to prevent 
the spread of this environmentally and economically damaging non-native 
aquatic invasive species. Despite their best efforts, quagga mussels 
continue to impact water users along the Colorado River system--
clogging filters, pipes, and pumps. Most traditional methods of control 
are not compatible with drinking water and environmental regulations. 
Given that 25 million people down river rely on the Colorado River as a 
key element of their water supply, resolving, or at least managing the 
quagga problem may be a priority for BOR. Can you please explain what 
BOR has done to address the problem and what does it propose to do in 
the future?
    Answer. As a high-priority component of BOR's Science & Technology 
(S&T) Program since 2008, BOR has focused invasive mussel research 
activities on improving early detection methods; identifying, 
developing, demonstrating, and implementing facilities protection 
technologies and strategies; and assessing ecological impacts. 
Researchers are engaged in a number of mussel-related activities 
including monitoring of more than 350 water bodies throughout the 
Western United States for the presence of mussels, coatings testing to 
prevent or reduce settlement on critical infrastructure, development of 
a promising treatment product called ZequanoxTM (based on 
the common bacteria Psuedomonas florescens), and field evaluation of 
filtration and UV treatment technologies to exclude mussels from raw 
water systems. The potential of several other technologies is also 
being explored for removal or settlement prevention on intake 
structures and within pipelines including elevated pH control 
strategies; pulsed pressure devices; turbulence generating devices; 
carbon dioxide injection; dissolved oxygen reduction; potential for the 
use of certain registered herbicides; retrofit of trashrack raking 
systems; fish predation; and alternative fish screening technologies. 
Many of these activities involve collaboration with other Federal and 
State agencies, BOR's managing partners, and private industry and are 
expected to evolve as future research needs and new technologies are 
identified. BOR is also continuing to assess the long-term ecological 
impacts related to mussel infestations in western water bodies.
    BOR has also developed an Equipment Inspection and Cleaning Manual 
in cooperation with COE. This manual provides recommendations for 
inspection and cleaning of vehicles and equipment as a prevention tool 
to limit the spread of mussels and other invasive species carried to 
new sites by contaminated equipment. Since release of this manual, many 
other agencies and organizations have adopted its mussel prevention 
protocols. BOR also hosted the 17th International Conference on Aquatic 
Invasive Species in San Diego last year to help attract attention of 
the global scientific community to the importance of these mussels in 
the western watersheds of the United States.
    Question. How much has BOR spent to address the quagga mussel 
problem?
    Answer. It is estimated that BOR will have spent more than $12.5 
million through fiscal year 2010 and includes appropriations, power 
revenues and other funding from customers.
    Question. What are those funds being used for?
    Answer. Since 2008, BOR funding has supported mussel-related 
activities including prevention, early detection and rapid response, 
control and management, research and development, and education and 
outreach.
    Question. How has the quagga mussel impacted water quality and 
habitat in the Colorado River both above and below Lake Mead?
    Answer. Quagga mussels appear to be impacting water quality and 
habitat in the Colorado River above and below Lake Mead. Water clarity 
is increasing and, as a result, the production of aquatic weeds is 
increasing and becoming a problem at pumping plants intakes. The extent 
to which this change is caused by mussels versus other factors has not 
been quantified. Quagga mussels are also expected to affect nutrient 
dynamics and therefore have a detrimental impact on fisheries. BOR is 
continuing to assess the long-term ecological impacts related to mussel 
infestations including changes in water quality, interactions with 
other benthic organisms, and the potential for cyanobacteria-producing 
toxins in western water bodies.
    Question. What else could we do to address the problem, to protect 
habitat and wildlife, and to preserve water and irrigation district 
infrastructure?
    Answer. BOR continues to address evolving issues through 
monitoring, research, outreach, and education activities. Further 
knowledge is continually being gained through research that improves 
our understanding of mussel-related ecological and infrastructure 
impacts in the West and supports our strategies to mitigate impacts to 
water and hydropower facilities. Prevention of mussel movement to new 
water bodies is a very important activity, but it falls primarily to 
agencies that manage recreation at lakes and reservoirs and have 
authority to control the movement of watercraft and invasive species.
    As a high-priority component of BOR's S&T program since 2008, BOR 
has focused invasive mussel research activities on improving early 
detection methods; identifying, developing, demonstrating, and 
implementing facilities protection technologies and strategies; and 
assessing ecological impacts. Researchers are engaged in a number of 
mussel-related activities including monitoring of more than 350 water 
bodies throughout the Western United States for the presence of 
mussels, coatings testing to prevent or reduce settlement on critical 
infrastructure, development of a promising treatment product called 
ZequanoxTM (based on the common bacteria Psuedomonas 
florescens), and field evaluation of filtration and UV treatment 
technologies to exclude mussels from raw water systems. The potential 
of several other technologies is also being explored for removal or 
settlement prevention on intake structures and within pipelines 
including elevated pH control strategies; pulsed pressure devices; 
turbulence generating devices; carbon dioxide injection; dissolved 
oxygen reduction; potential for the use of certain registered 
herbicides; retrofit of trashrack raking systems; fish predation; and 
alternative fish screening technologies. Many of these activities 
involve collaboration with other Federal and State agencies, BOR's 
managing partners, and private industry and are expected to evolve as 
future research needs and new technologies are identified. BOR is also 
continuing to assess the long-term ecological impacts related to mussel 
infestations in western water bodies.
    BOR has also developed an Equipment Inspection and Cleaning Manual 
in cooperation with COE. This manual provides recommendations for 
inspection and cleaning of vehicles and equipment as a prevention tool 
to limit the spread of mussels and other invasive species carried to 
new sites by contaminated equipment. Since release of this manual, many 
other agencies and organizations have adopted its mussel prevention 
protocols. BOR also hosted the 17th International Conference on Aquatic 
Invasive Species in San Diego last year to help attract attention of 
the global scientific community to the importance of these mussels in 
the western watersheds of the United States.
                                 ______
                                 
               Question Submitted by Senator Patty Murray

             bor deg.ODESSA SUBAREA SPECIAL STUDY

    Question. Commissioner Connor, as you know I have worked closely 
with the Bureau of Reclamation (BOR) over several years on the Odessa 
Subarea Special Study to look at surface options for irrigation to 
reduce the impact to the aquifer. Clearly, agriculture is vital to 
Washington State's economy and the Central Washington area is a huge 
part of the industry. We are so close to finishing the Study to 
determine the best path forward, but I am hearing that the BOR doesn't 
plan to fund the remainder. Can you please tell me your plan to ensure 
the completion of the study?
    Answer. BOR recognizes the importance and understands the 
significance of the Columbia Basin water issues, and specifically the 
Odessa Subarea Special Study (Study). In this regard, BOR has partnered 
with the State of Washington (State) to investigate the possibility of 
continued development of the Columbia Basin Project to deliver project 
surface water to replace the current ground water use in the Odessa 
Subarea. The Study is near completion; however, faced with considerable 
competing demands for aging infrastructure, satisfying Endangered 
Species Act regulatory requirements on operating projects, and other 
high-priority water issues throughout the 17 Western States, it was not 
possible for BOR to provide funding for the study in the fiscal year 
2012 President's budget. BOR will continue to work with the State to 
bring the Study to completion as soon as possible. BOR and State of 
Washington Department of Ecology have jointly prepared a draft 
environmental impact statement (EIS) to meet the National Environmental 
Policy Act and State Environmental Policy Act requirements. The draft 
EIS was released to the public from October 26, 2010 through January 
31, 2011, with more than 210 comment letters received. The final EIS is 
anticipated to be completed by late 2011.
                                 ______
                                 
               Questions Submitted by Senator Tim Johnson

                      bor deg.RURAL WATER

    Question. Given increases in prices over time and the necessary 
noncontract and overhead costs associated with construction projects, 
it follows that the longer a project takes to complete, the more 
expensive it will be. Has the extension of the completion of Bureau of 
Reclamation's (BOR) Rural Water Supply Projects increased overhead 
costs at the expense of construction?
    Answer. Yes. As annual appropriations are less than what is 
necessary to support full project construction, we believe some Rural 
Water Supply Projects are incurring increased overhead costs at the 
expense of construction.
    Question. If so, by how much?
    Answer. BOR does not have any way of quantifying such an increase 
and does not have specific data to determine the actual extent to which 
increased overhead may impact the total cost of completing projects.
    Question. How does BOR propose to restore the funds which had to be 
used to cover overhead costs so that construction can be completed?
    Answer. Historically, cost indexing authorized for each of the 
current rural water projects has kept pace with inflation, and coupled 
with a favorable construction climate, projects appear to be 
progressing within original cost estimates. The funds requested by BOR 
for rural water construction are formulated to account for projected 
construction capabilities and other mission critical work.
                                 ______
                                 

                          SUBCOMMITTEE RECESS

    Senator Feinstein. So thank you for taking it all with good 
humor. Thank you very much.
    And the hearing is recessed.
    [Whereupon, at 4:12 p.m., Wednesday, April 13, the 
subcommittee was recessed, to reconvene subject to the call of 
the Chair.]


    ENERGY AND WATER DEVELOPMENT APPROPRIATIONS FOR FISCAL YEAR 2012

                              ----------                              


                         WEDNESDAY, MAY 4, 2011

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 2:21 p.m., in room SD-192, Dirksen 
Senate Office Building, Hon. Dianne Feinstein (chairman) 
presiding.
    Present: Senators Feinstein and Alexander.

                          DEPARTMENT OF ENERGY

                National Nuclear Security Administration

STATEMENT OF HON. THOMAS P. D'AGOSTINO, UNDER SECRETARY 
            FOR NUCLEAR SECURITY AND ADMINISTRATION
ACCOMPANIED BY:
        ANNE HARRINGTON, DEPUTY ADMINISTRATOR FOR DEFENSE NUCLEAR 
            NONPROLIFERATION
        ADMIRAL KIRKLAND DONALD, DEPUTY ADMINISTRATOR FOR NAVAL 
            REACTORS
        DR. DONALD COOK, DEPUTY ADMINISTRATOR FOR DEFENSE PROGRAMS

             OPENING STATEMENT OF SENATOR DIANNE FEINSTEIN

    Senator Feinstein. Good afternoon, ladies and gentlemen, 
and welcome to the Energy and Water Development Subcommittee's 
oversight hearing on the National Nuclear Security 
Administration's (NNSA) fiscal year 2012 budget request.
    NNSA has requested $11.8 billion for fiscal year 2012. It 
is an increase of $1.1 billion, or 10.2 percent, more than the 
fiscal year 2011 level. I think in a sense, they are an 
endangered species because they are probably the only one, 
Senator Alexander, that is going to get this kind of a raise. I 
noted all of the smiles on their faces when they came into the 
room. This is, in fact, the largest increase to NNSA since it 
was established 11 years ago.
    This increase also follows another record-breaking increase 
of $813 million, or 8.2 percent, in fiscal year 2011. Based on 
the 2012 budget request, NNSA's budget would grow by about $2 
billion over 2 years.
    The budget increase presents a number of opportunities 
including:
  --accelerating efforts to secure all vulnerable nuclear 
        materials by the end of fiscal year 2013 to reduce the 
        threat of nuclear terrorism;
  --extending the life of nuclear weapons currently in the 
        stockpile;
  --replacing or upgrading aging infrastructure needed to 
        ensure the safety, security, or reliability of nuclear 
        weapons; and
  --designing nuclear reactors that will operate for 40 years 
        without refueling for Ohio Class ballistic missile 
        submarines.
    Now, with these opportunities also come some challenges. 
Regarding nonproliferation, the goal announced in April 2009 to 
secure all vulnerable nuclear materials in 4 years has 
accelerated nuclear security efforts.
    I would like to highlight a few recent achievements over 
the last 2 years. NNSA has removed 960 kilograms of highly 
enriched uranium, enough nuclear material for 38 nuclear 
weapons. NNSA has removed all highly enriched uranium from six 
countries. One of these countries was Libya. Given the recent 
unrest in Libya, the presence of this dangerous nuclear 
material in an unstable part of the world would have increased 
the risk of nuclear terrorism. Removing highly enriched uranium 
from six countries in 2 years is much faster than one country a 
year that NNSA has averaged in the last 13 years. NNSA has also 
completed security upgrades at 32 buildings in Russia 
containing weapons usable materials.
    Now, despite this progress, stockpiles of nuclear weapon 
materials around the world are still vulnerable to theft. In 
particular, all of the publicly known cases of theft of weapons 
usable nuclear material were perpetrated by insiders. 
Corruption and insider threats are endemic in many parts of the 
world, including Russia. That places unsecured weapons usable 
nuclear weapons in great jeopardy.
    I would like to discuss how NNSA has addressed this threat 
for a moment. Regarding nuclear weapons activities, I am 
concerned about your ability to develop reliable costs and 
schedule estimates for complex nuclear infrastructure projects. 
You plan to build three new facilities that will each exceed $3 
billion in costs, and in some cases may exceed $6 billion--the 
Chemistry and Metallurgy Research Facility at Los Alamos, the 
uranium processing facility at Y-12, and the pit disassembly 
and conversion facility at Savannah River. NNSA plans to spend 
$682 million on these three projects alone in fiscal year 2012, 
and will reach a peak of $1.1 billion by fiscal year 2014. New 
cost estimates for these facilities are three times more than 
the original estimates. So, we need to discuss this.
    NNSA has a long history of underestimating budget needs and 
increasing cost projections because of design schedule, design 
changes, and schedule delays. If the costs for these facilities 
increase further, I am concerned that it could harm higher-
priority missions, such as life-extension programs and 
increased weapon surveillance. NNSA must demonstrate to the 
Congress that it can effectively manage these complex projects 
and complete them on time and on budget.
    Modernizing our infrastructure on time and on budget, 
however, is not enough. NNSA must clearly demonstrate how this 
new infrastructure will not only enhance the safety, security, 
and reliability of our nuclear weapons, but also help reduce 
the size of the stockpile.
    The new START Treaty was a step in the right direction by 
reducing the size of our actively deployed nuclear weapons to 
1,550. However, we still maintain 5,100 nuclear weapons. A 
major justification for investing in new infrastructure is to 
reduce the hedge; that is, the weapons we hold in reserve in 
case an unforeseen problem occurs with their reliability and 
performance.
    NNSA must do a better job explaining how these multi-
billion dollar facilities and major investments in experimental 
facilities, such as the National Ignition Facility, will help 
us draw down the stockpile further.
    As you know, Mr. D'Agostino, this is important to me. You 
are asking for a lot of money, so the performance has to be 
there to back up this additional money in reduction of nuclear 
weapons.
    Joining us today to explore these important national 
security issues is Thomas P. D'Agostino, the Administrator of 
the National Nuclear Security Administration. Senator 
Alexander, I want you to know I have the highest respect for 
him. We had substantial classified briefings on the prior 
effort on the Reliable replacement Warhead program and, before 
that, on the proposal for increased nuclear weapons, plutonium 
pits, advanced weapons concepts, and on and on. He has always 
been an absolute straight shooter, and I really, really prize 
that. So, I know what you say is the truth, and I very much 
appreciate that.
    Joining Mr. D'Agostino is Dr. Donald Cook, the Deputy 
Administrator for Weapons Activities; Anne Harrington, the 
Deputy Administrator for Nuclear Nonproliferation; and Admiral 
Kirkland Donald, Deputy Administrator for Naval Reactors. So, 
thank you all for taking time to be here today, and let me turn 
to Senator Alexander for his comments.

                  STATEMENT OF SENATOR LAMAR ALEXANDER

    Senator Alexander. Thank you, Senator Feinstein. As always, 
it is good to work with you and to see you. And thank you for 
our very accomplished witnesses for being here. I look forward 
to your testimony.
    I have three or four points I would like to make.
    Number one, if Senator Inouye and Senator Cochran were 
here, I would say--and if they come I will say--that most of 
NNSA's responsibility are in support of the U.S. military, and 
this appropriation ought to be treated in part like Defense 
spending. And that will become increasingly important as we 
make budgets over the next several years because when we have a 
Government that is collecting $2.2 trillion and spending $3.7 
trillion, we have a lot of tough decisions to make. And we 
have, as the Senator said--the Chair said--we have a 
significant increase in a--in nuclear modernization, for 
example. We agreed on that. The President agreed with that in 
connection with the vote of the new START Treaty, which I 
supported. I think it was a wise treaty. But at the same time, 
we do not want our nuclear weapons to begin to resemble a 
collection of wet matches, and they will not, given the plan 
that is laid out here.
    So, that is my first point, Madam Chairman, that I think as 
we talk with Senators Inouye and Cochran, that when allocations 
are made, that this spending should be defense spending and not 
be competing with National Labs, other environmental clean-up, 
et cetera.
    Number two, I would like to follow up on Senator 
Feinstein's point about management of projects. Probably the 
area where we in the Senate have not done as well as we should 
have is in the area of oversight. That really is a true 
function of the Congress, especially of the appropriations 
subcommittees. I mean, it is our job really to understand 
issues. We work hard on that, but we get pulled in many 
different ways and do not have a chance to do that as much as 
we should.
    And that should be particularly true with the Department of 
Energy (DOE) and with this part of DOE because it is just full 
of multi-billion dollar projects. I just left a meeting with 
Secretary Chu. We were talking about environmental management 
projects, which are a different part of DOE. But there, he has 
got massive projects, and when we are spending too much, there 
are difficult decisions. We have got to clean up radiation. We 
have got to clean up mercury. But if we can save $1 billion 
here or $1 billion there, that money can go to National 
Laboratories. It can go to research for energy. It can go to 
environmental clean-up. It can go to a whole variety of areas.
    So, I hope that I can support the chairman and that we can 
vigorously assist you in taking a fresh look at project 
management as we go through this period of reduced spending. In 
fact, we are going to have to if we are going to have the money 
to do what we need to do.
    Third, I have a list of about $20 billion of your major 
NNSA projects. And it would be nice to talk about ways to 
figure out what is it really going to cost, and then can it 
stay that way? I remember while I was running for Governor, a 
group in Knoxville wanted a road built. And I asked the 
chairman of the Chamber of Commerce, well, how do you propose I 
do that if I am elected? He said, well, I would get the best 
possible person to run it, to agree on a plan and meet with him 
once a month, and see if you are following the plan. Well, I 
was elected. I got that person to come be the transportation 
commissioner. We met once a month. The road got built. So, 
maybe we need to make sure that we get designs that we agree 
with, cost amounts that we agree on, and have monthly report 
sessions to make sure that we are on schedule or not on 
schedule. Maybe we can be of assistance in that way.
    Fourth, that leads me to some questions I will be asking 
during my question time about whether it is a good idea, Mr. 
D'Agostino, to spend time consolidating a contract at Oak Ridge 
and Pantex, or Y-12 and Pantex, whether you could really save 
more money and more of your management energy doing that and 
causing the contractor to work on that, or whether you would be 
better off working on all these big projects I was just talking 
about. So, we will get into that.
    Finally, I am delighted to see--delighted to talk a little 
bit about naval reactors. It has always puzzled me, Senator 
Feinstein, about why we seem to do so well with the naval 
reactors and we cannot build a nuclear power plant in the 
United States. In fact, one of my proposals, and I was only 
partly in jest, that the way to have clean electricity in the 
United States, the largest amount of it, is just to build seven 
nuclear-powered destroyers and plug them in around the country 
where the population centers are, and have, you know, add 
15,000 or 20,000 megawatts of clean electricity. We could 
probably get that done in a short period of time. We are able 
to--I mean, both have been safe. We have never had a fatality 
either in connection with a naval reactor or with a civilian 
reactor. But I think we have a lot to learn from naval reactors 
that we might transfer to our civilian reactor program. So, I 
will look forward, Admiral, to talking about that and what you 
think we might learn from that as well as supporting your 
efforts.
    So, Madam Chair, this is--and ought to be--a fascinating 
hearing. I look forward to the testimony and thank you for your 
time.
    Senator Feinstein. Thank you very much, Senator, and I look 
forward to working with you. We did so on Interior, and we will 
do so on this subcommittee as well.
    Let me turn to you now, Mr. D'Agostino. Will you be making 
the comments for everybody at the table?
    Mr. D'Agostino. Yes, Madam Chairman.
    Senator Feinstein. Okay. Please proceed.

               SUMMARY STATEMENT OF THOMAS P. D'AGOSTINO

    Mr. D'Agostino. Thank you. Madam Chairwoman, Ranking Member 
Alexander, thank you for the opportunity to address this 
subcommittee today. But more importantly, thank you for your 
continued support of the NNSA and the 35,000 men and women 
working across our enterprise to keep our country safe, protect 
our allies, and enhance global security. We could not do this 
work without strong bipartisan support and engaged leadership 
from the Congress.
    As I come before you today, the capability NNSA offers to 
the Nation, and indeed the world, are on display in real time. 
Just last week, I had the opportunity to travel to Nevada to 
visit the Remote Sensing Laboratory. For 7 weeks, the talented 
and dedicated men and women at the Remote Sensing Laboratory 
had been working with their colleagues from across the 
enterprise to support the response to the devastating 
earthquake and tsunami that struck Japan on March 11, 2011. 
They had been providing critical information to our interagency 
colleagues and to our partners in Japan. Of course, our 
thoughts and prayers are with the Japanese people during this 
very difficult time, but I was honored to have the opportunity 
to thank our men and women personally and directly last week 
for their outstanding work.
    Our ability to respond to this crisis is the latest example 
of the vital and diverse role we play in implementing the 
President's nuclear security agenda and of the need to invest 
in the future of our enterprise. This budget request seeks the 
funds required to make these investments.
    As I see it, the budget request can be broken down into 
three key themes. First, we're investing in the future. 
President Obama has requested $7.6 billion for our weapons 
activities account to support our effort to leverage the best 
science and technology in the world to maintain our nuclear 
deterrent. This will enable us to enhance our surveillance of 
the stockpile, continue to design modern facilities that we 
need to maintain our Nation's expertise in uranium and 
plutonium processing and research, and proceed with key life 
extension programs for our weapon systems.
    A critical part of that is the life extension program for 
the W78 warhead. Consistent with the policies in the 
President's Nuclear Posture Review, we have submitted a request 
to this subcommittee and the House Energy and Water Development 
Subcommittee to begin studying the requirements for the W78 
life extension, including the option for interoperability of 
the nuclear explosive package with the Navy's W88 warhead. I 
strongly encourage this subcommittee to approve this request.
    Investing in a modern enterprise is critical to our 
stewardship program, but it also supports the full range of 
NNSA's nuclear security missions, which brings me to the second 
key theme that this budget request shows, and that is 
implementing the President's nuclear security agenda. As 
President Obama has said in his speech in Prague in April 2009, 
the threat of a terrorist acquiring and using a nuclear weapon 
is the most immediate and extreme threat we face. Preventing 
the spread of nuclear weapons and keeping dangerous materials 
out of the hands of terrorists is a vital national security 
priority.
    To address that threat, we are requesting $2.5 billion in 
2012 and more than $14.2 billion over the next 5 years for our 
nuclear nonproliferation programs. This will provide the 
resources required to meet the commitment secured during the 
2010 Nuclear Security Summit.
    To power the nuclear Navy, President Obama has requested 
$1.1 billion for NNSA's naval reactors program. This will allow 
us to continue the design work on the propulsion unit for the 
Ohio Class Replacement Submarine in order to meet the Navy's 
required procurement date of 2019. It includes critical 
investments in a modern and sustainable spent fuel, spent 
nuclear fuel infrastructure at the naval reactor site in Idaho 
National Laboratory. And finally it seeks the resources to 
refuel the land based prototype in upstate New York.
    Madam Chairwoman, I realize that this subcommittee has many 
competing requirements and that this request comes at a time of 
acute financial stress for our entire country. But I believe 
nothing is more important than ensuring our Nation's security. 
It is my responsibility to assure you that we can manage these 
increases wisely.
    That brings me to the third key theme outlined in this 
budget request, and that is our commitment to improve the way 
we do business and manage our resources.
    For us, improving our project management is part of the 
implementing, achieving our mission, and implementing the 
President's nuclear security agenda. To better ensure that we 
bring these major projects to completion on time and on budget, 
we will ensure that we have qualified project managers leading 
our major projects. We will set costs and schedule baselines on 
construction projects when design work is 90 percent complete, 
and we will subject these estimates to rigorous independent 
reviews.
    We are partnering with our Management and Operations (M&O) 
partners to streamline our governance model to devote more 
resources to critical mission work while maximizing safety and 
security at our sites. We are making sure that we have the 
right contracting strategy in place. We are continuing to find 
innovative ways to save money across the enterprise. For 
example, since 2007, our Supply Chain Management Center has 
used new technologies and pool purchasing power to drive 
efficiencies across our sites. The result has been more than 
$213 million in auditable cost savings.

                           PREPARED STATEMENT

    All of this is part of our effort to create one NNSA, a 
true partnership between all of our programs and all of our 
partners to fulfill a common mission. Taken together, these 
steps will ensure that we have a modern, 21st century nuclear 
security enterprise that is safer, more secure, more efficient, 
and organized to succeed. That is the vision outlined in this 
budget request. It supports the full range of NNSA missions, 
and, more importantly, it represents a critical investment in 
the infrastructure, the people, the science, technology, and 
engineering required to fulfill our missions. I look forward to 
working with the members of this subcommittee to help make that 
vision a reality.
    With that, we would be happy to take any questions you may 
have.
    [The statement follows:]

               Prepared Statement of Thomas P. D'Agostino

    Thank you for the opportunity to present the fiscal year 2012 
President's budget request for the National Nuclear Security 
Administration (NNSA). This budget request will allow the NNSA to meet 
its commitments to the American people and our international partners 
to provide for nuclear deterrence, to reduce nuclear dangers around the 
world, and to provide the capabilities to address the broader national 
security challenges of the 21st century.
    The vision of NNSA is to make the world a safer place. NNSA's 
mission is to enhance global security through nuclear deterrence, 
nonproliferation, counterterrorism, naval nuclear propulsion, and to 
support national leadership in science and technology.
    Recognizing the economic challenges facing our Nation and the 
budget pressures being felt throughout the Federal Government, the 
President demonstrates through this fiscal year 2012 budget request his 
strong commitment to the nuclear security of our country and our allies 
by proposing an unprecedented investment in NNSA's mission. This 
investment is a commitment to recapitalize the nuclear security 
enterprise and do it in a way that makes sense.
    The fiscal year 2012 President's budget request provides $11.78 
billion to invest in a modern, 21st century nuclear security 
enterprise, implement the President's nuclear security agenda, and 
improve the way the NNSA does business and manages its resources.
    The fiscal year 2012 request represents an increase of 5.1 percent 
more than the $11.2 billion requested for fiscal year 2011, reflecting 
a commitment to investing in a modern enterprise that can support the 
full range of nuclear security missions. The request highlights the 
vital role NNSA plays in implementing the President's nuclear security 
agenda and the broad, bipartisan consensus that has developed over the 
last 2 years regarding the role NNSA plays in enhancing our Nation's 
security and the resources needed to get the job done.

                        INVESTING IN THE FUTURE

    Secretary of Energy Chu and I work closely with Secretary of 
Defense Gates and other Defense Department (DOD) officials to ensure 
that NNSA remains focused on a strong interagency partnership that 
meets our national security requirements and promotes NNSA's 
sustainability. As a result, the President's request includes $7.6 
billion for the weapons activities appropriation, an 8.9 percent 
increase more than the President's fiscal year 2011 request and a 19.5 
percent increase over the fiscal year 2010 appropriation to invest in 
the future of the nuclear security enterprise. These resources will 
support, among other things, the operation and construction of the 
modern research facilities needed to do cutting-edge science and 
attract the next generation of nuclear security experts. It continues 
implementation of the President's commitment to invest $85 billion over 
the next decade to sustain the nuclear deterrent and to modernize the 
infrastructure that supports it, as well as to implement the agenda 
outlined in the Nuclear Posture Review, the Stockpile Stewardship and 
Management Plan and the updated section 1251 report submitted to the 
Congress.
    NNSA's budget request also includes associated out-year projections 
in the Future-Years Nuclear Security Program (FYNSP) that identifies 
resources needed to meet the continuing requirements for significant 
long-term investments in the deliverables, capabilities and 
infrastructure of the enterprise.
    These resources will help us invest in a modern, 21st century 
Nuclear Security Enterprise that can sustain the stockpile and support 
our full range of nuclear security missions. With these investments, 
NNSA will be able to continue to move toward an enterprise that is 
safer, smaller, more secure, more efficient, more sustainable, and more 
adaptable.
    The request includes an increase of 3.1 percent more than the 
fiscal year 2011 level to protect and advance the scientific 
capabilities at the U.S. national security laboratories and a 21 
percent increase for infrastructure improvements, including continuing 
work on the Uranium Processing Facility at the Y-12 National Security 
Complex and the Chemistry and Metallurgy Research Replacement facility 
(CMRR) at Los Alamos National Laboratory. These capital projects are 
key for ensuring safe, secure, and reliable uranium and plutonium 
capabilities for nuclear security and other important missions.
    To power the nuclear navy, the budget request includes $1.2 billion 
for the NNSA's Naval Reactors program, an increase of 7.8 percent more 
than the fiscal year 2011 President's request. The programs in this 
appropriation support the U.S. Navy's nuclear fleet. Specifically, the 
request supports the administration's decision to recapitalize the sea-
based strategic deterrent. The Ohio Class ballistic submarines, the 
most survivable leg of the Nation's strategic deterrent, are reaching 
the end of their operational life. The request will enable Naval 
Reactors to continue reactor plant design and development efforts begun 
in 2010 for procurement of long-lead reactor plant components in 2017, 
in support of Navy procurement of the first Ohio Class submarine 
replacement in 2019. Providing the Ohio Class replacement a life-of-
the-ship reactor core will require substantial advances in 
manufacturing technology to provide a new cladding and a new fuel 
system. The request also supports the refueling of a land based 
prototype reactor, providing a cost-effective test platform for these 
new technologies.
    Increased funding is also requested for the Spent Fuel Handling 
Recapitalization Project, which will replace the more than 50-year old 
Expended Core Facility as the location for naval spent nuclear fuel 
receipt, inspection, dissection, packaging, and secure dry storage. 
Fiscal year 2012 funding continues the conceptual design for the 
facility, equipment, and related systems, as well as continues meeting 
the National Environmental Policy Act's requirements and project 
oversight (e.g., engineering procurement and construction management). 
Detailed project engineering and design work will commence in fiscal 
year 2013 and construction will commence in fiscal year 2015.
    These vital projects will replace facilities that date back to the 
dawn of the cold war with modern facilities that can support the full 
range of nuclear security missions--including maintaining the nuclear 
deterrent, preventing proliferation, securing vulnerable nuclear 
material, powering the nuclear Navy and providing the Nation with the 
best emergency response and counterterrorism capabilities possible. 
They will also ensure that NNSA can continue to work with the 
Department of Defense and other interagency partners to keep the Nation 
safe.

          IMPLEMENTING THE PRESIDENT'S NUCLEAR SECURITY AGENDA

    The fiscal year 2012 budget request also provides the resources 
required to continue to work toward the President's commitment to 
secure vulnerable nuclear material around the world within 4 years, a 
key national security goal. The budget request includes $2.5 billion 
for Defense Nuclear Nonproliferation in fiscal year 2012 and $14.2 
billion over the next 5 years to reduce the global nuclear threat by 
detecting, securing, safeguarding, disposing and controlling nuclear 
and radiological material worldwide, as well as promoting the 
responsible application of nuclear technology and science.
    This request reflects the significant accomplishments of NNSA's 
nuclear nonproliferation programs in the past year, and seeks the 
resources needed to complete the President's goals. This budget request 
provides the resources required to meet commitments secured from 
international partners during the 2010 Nuclear Security Summit to 
remove all remaining highly enriched uranium (HEU) from Belarus, 
Ukraine, Mexico, and other countries by April 2012 and to work with the 
Defense Department to improve international nuclear security 
cooperation.
    The request of $2.5 billion is a decrease of 5.1 percent from the 
fiscal year 2011 President's request, but an increase of 19.6 percent 
more than the fiscal year 2010 appropriation. This 5.1 percent or $138 
million decline flows logically from the fiscal year 2011 request which 
was ``front loaded'' to accelerate the effort to secure vulnerable 
nuclear materials within the President's stated timeframe. Even with 
this decrease, the NNSA's budget request remains consistent with our 
overall strategy to ensure that programs supporting the President's 
commitment to lead an international effort to secure all vulnerable 
nuclear materials around the world in 4 years are fully funded in the 
request. The Global Threat Reduction Initiative efforts related to 
radiological material, as well as the International Nuclear Material 
Protection and Cooperation program's activities to enhance the ability 
of our foreign partners to detect nuclear smuggling at border crossings 
and in megaports have been prioritized to accommodate accelerated 
nuclear material lockdown efforts. The decrease in the request for 
Fissile Materials Disposition reflects the completion of long-lead 
procurements for the MOX and Waste Solidification projects, 
as well as the decision to wait to request additional funds associated 
with the $400 million United States pledge for the Russian program 
until agreement is reached on milestones for the program.

    IMPROVING THE WAY NATIONAL NUCLEAR SECURITY ADMINISTRATION DOES 
                                BUSINESS

    Consistent with the President's commitment to deliver on critical 
national nuclear security missions at the best value to the American 
taxpayer, the fiscal year 2012 budget request will enable NNSA to 
continue to improve the way it does business and manages resources. The 
President's budget request for Federal oversight and staff included in 
the Office of the Administrator appropriation is $450.1 million, an 
increase of 0.4 percent more than the fiscal year 2011 request and an 
increase of 7 percent more than the fiscal year 2010 appropriation.
    NNSA recognizes that the fiscal year 2012 budgetary investments 
come at time of severe economic challenge for our country and a renewed 
commitment to reduce the deficit. To maintain bipartisan support for 
the NNSA programs, the enterprise has a responsibility to work together 
as ``One NNSA'', a fully integrated enterprise that operates 
efficiently, is organized to succeed, that performs its work 
seamlessly, and speaks with one voice. This ``One NNSA'' needs to be a 
true partnership among Headquarters, the Site Offices and our 
Management and Operations (M&O) partners.
    Changing the way NNSA does business is an important part of the 
effort to transform a cold war nuclear weapons complex into a 21st 
Century Nuclear Security Enterprise. NNSA simply cannot expect the 
Congress to support major investments in its programs and its 
facilities unless the enterprise can demonstrate that the Department of 
Energy is a responsible steward of the taxpayer's money.
    NNSA needs to do better, which is why the Federal sector leadership 
is working with its M&O partners to streamline the enterprise 
governance model in order to devote more resources to critical mission 
work and maximize NNSA's ability to complete its mission safely and 
securely.
    NNSA is making sure that it has the right contracting strategy in 
place. The agency is improving its project management by, for example, 
ensuring that NNSA no longer sets cost and schedule performance 
baselines on construction projects until design work is 90 percent 
complete, ensuring it has the right leadership teams in place, and 
performing independent cost reviews. NNSA has also created a new policy 
and oversight office for managing major projects. The new office 
reports directly to the Administrator. This will help ensure that 
project management gets the high-level focus it requires.
    We are already beginning to see results. NNSA is increasingly 
recognized for its efforts to be an effective steward of tax dollars. 
For example, since 2007, NNSA's Supply Chain Management Center has 
saved $213 million by using pooled purchasing power to drive 
efficiencies across the enterprise. In the last year NNSA's Kansas City 
Plant won the prestigious Malcolm Baldrige Award, America's highest 
honor for innovation and performance excellence. Two other NNSA 
programs were recognized with Project Management Institute (PMI) 
awards. In 2010, the Global Threat Reduction Initiative became the 
first Federal project to receive PMI's Distinguished Project Award, 
while the National Ignition Facility at Lawrence Livermore National 
Laboratory received PMI's project of the year.

                               CONCLUSION

    The Nation has carefully evaluated its security needs in an 
international landscape that remains challenging and uncertain. NNSA 
has charted a path forward that shows our unwavering commitment to the 
Nation's security and enhances our formidable capabilities to address 
broader security challenges.
    The NNSA is a technically based organization with a strong nuclear 
heritage that serves as the base for our contribution to a wide range 
of national security solutions. NNSA is rooted in the management of our 
Nation's nuclear weapons stockpile and the application of nuclear 
energy for naval propulsion. Additionally, NNSA capabilities support a 
broad range of U.S. and international activities that address existing 
dangers, identify and prepare for future challenges, and advise the 
U.S. Government and our international partners on nuclear security 
matters.
    This budget request takes the NNSA into the next decade and 
strengthens the capabilities that are themselves integral elements of 
our nuclear deterrent. The challenge is to retain the capabilities that 
continue to be essential, and to identify and develop those needed for 
the future.

    Senator Feinstein. Thank you very much. I appreciate that.
    Data provided by DOE and your entity shows that there are 
more full-time equivalent (FTE) staff working at the three 
nuclear weapons labs--Los Alamos, Livermore, and Sandia--than 
at the height of the cold war. In 1987, there were 12,160 FTEs 
when the United States had 23,575 nuclear weapons. In 2009, the 
labs had 13,977 FTEs when the United States had one-third the 
number of nuclear weapons, namely 5,113.
    So, you have had 15 percent more FTEs to maintain a nuclear 
stockpile that is 78 percent smaller. Could you please tell us 
why?
    Mr. D'Agostino. Yes, ma'am. I think it's due to a couple of 
reasons, and I--if it is possible, I would like for my 
colleagues to also answer--follow on with me behind me.
    I think one of the main reasons is we have an inherently 
different program now than we had during the height of the cold 
war. During the height of the cold war, we were in the process 
of constantly cycling and training and designing, develop, 
test, deploy, and take out systems, so there was a constant 
flow in production. And that type of a process allows a very 
efficient design through production through finishing off a 
life-cycle process, if you will, in our weapon systems. And we 
are obviously doing underground nuclear tests.
    Now, we are relying on science a lot more, if you will, to 
ensure that we can take care of these--the stockpile without 
underground testing. That is a completely new era that we have 
had to, in fact, invent, if you will, with our laboratories to 
develop the tools, deploy the tools. Tools in this case I am 
talking about are computers, are large, experimental 
facilities, like the dual access radiographic hydro test 
facility at Los Alamos, the National Ignition Facility at 
Lawrence Livermore, the Z machine at Sandia--develop these 
tools in order to do a lot more subcritical experiments and 
basic science and material experiments and use the codes to do 
this. And this requires a tremendous amount more, in my view, 
of scientists and engineers in order to achieve that 
capability.
    So, the job, I think, in many respects is a harder job, and 
is not directly attributable one-to-one to the size and number 
of the stockpiles.
    I think the second major reason is we have, in my view, 
particularly as we look at the data, an increase in the 
recognition of how these laboratories contribute to a much 
broader range of national security and nuclear security work 
than they did 20, 30 years ago. We are obviously--in many 
cases, our response, the DOE's response, to the Macondo oil 
spill--the BP oil spill is what it has been called--much of 
that technology came from three national security laboratories 
themselves. I would ask Don to add.
    Dr. Cook. I think it is a good question. Madam Chairman, if 
I could add to what the administrator has said, I would 
emphasize that we do have a broader range of work for multiple 
agencies. The national weapons labs especially are very 
important capabilities. They are accessed routinely these days 
by the Departments of Defense, Homeland Security, and Director 
of National Intelligence, in addition to DOE.
    With regard to the stockpile, it is true that we have the 
oldest stockpile we have ever had.
    Senator Feinstein. Well, that is going to continue.
    Dr. Cook. Yes. Yes.
    Senator Feinstein. I mean you are just going to build the 
stockpile.
    Dr. Cook. I think that is a clear statement. It is going to 
continue. It is also currently the smallest stockpile we have 
had since the days of the Eisenhower administration. The fact 
that it is the oldest and smallest means now that as we go 
forward, while we may continue to reduce warhead numbers, we 
must modernize, at the same time, the deterrent warheads and 
the infrastructure. And those are key contributors to the size 
of the workforce that we have.
    Senator Feinstein. Just as an aside to my colleague, you 
know when I was mayor of San Francisco--it has been that long 
ago--we computerized the city. I had the computer companies in 
and talked to them because it was a big contract. We thought 
oh, it would save the city money. I think it was a substantial 
number of employees, in the thousands; I cannot remember what. 
So, we did it. Do you think it reduced employments? No. It 
increased employments. So, you know, I think there is that 
factor that technology does not necessarily reduce employees 
qualified to handle the technology.
    But since it is just the two of us, and I will give the 
ranking member as much time as he wants, I want to just ask one 
other question right now.
    Senator Alexander. Please go ahead.
    Senator Feinstein. I expressed some concern about the risk 
of insiders stealing or helping to steal nuclear materials, and 
I think the large number of sites around the world magnifies 
that threat. For example, Russia and countries in the former 
Soviet Union alone have more than 230 buildings at more than 
130 sites that store weapons usable nuclear materials.
    So, the question is, what is NNSA doing to consolidate 
nuclear materials to a much smaller and easier to protect 
number of sites and buildings, especially in Russia?
    Mr. D'Agostino. If I could start and then ask Anne 
Harrington to follow on.
    Senator Feinstein. Please.
    Mr. D'Agostino. But we have a very active program with the 
Russians to not just secure material at their sites, but we 
have a sustainability component with the Ministry of Defense in 
Russia. We have essentially completed the security work there, 
and they have agreed and are following up on making sure that 
those security upgrades are maintained and to have them out 
into the future.
    With Rosatom, which is what--a little bit more on the 
civilian side or a little bit more equivalent to the NNSA, we 
have an active program of upgrading their sites there, and we 
have more of a cost-share arrangement to do on the work there.
    There is more work that has to be done in Russia, and 
Anne's team is working actively to partner with our colleagues 
there to make this happen.
    Senator Feinstein. Let me just stop you. Does it need 230 
buildings at 130 sites?
    Mr. D'Agostino. In fact, this is one of the concerns that 
we, together with the Russians, acknowledge that the more 
material that you have and more sites there is, the harder it 
is to protect. In this country, we have undertaken our own 
efforts for material consolidation because in the long run it 
is cheaper to protect material at fewer sites.
    Senator Feinstein. How many sites do we have in comparison?
    Mr. D'Agostino. Well, the 230 sites are--we have our 7 main 
sites, but within those 7 sites we are looking to move material 
out of the Lawrence Livermore Laboratory to reduce the security 
footprint and move some of that material into some of our other 
sites because we think it is not just safer to protect, but it 
is also cheaper. We hope to be saving some security dollars as 
a result of that.
    Senator Feinstein. We will mark that down.
    Mr. D'Agostino. Anne, do you want to add anything, please?
    Ms. Harrington. I would just add that it is a matter of our 
program policy that any country in which we work, we do 
encourage the consolidation of materials. And, in fact, that is 
what the 4-year effort is really aimed at, is not just 
consolidating materials, but consolidating and then removing 
the materials permanently, and then providing physical security 
upgrades in that interim period between when we negotiate the 
agreement and physically remove the material.
    Senator Feinstein. Ma'am, let me just interrupt you again. 
I understand that April 2010 was the halfway mark of the goal 
of securing all vulnerable nuclear materials in 4 years. Are 
you on track to secure it all in 4 years?
    Ms. Harrington. Well, April 2010 would have been 1 year, so 
approximately now would be 2 years from April, yes.
    Senator Feinstein. Well, now it is 2 years.
    Ms. Harrington. Yes, correct. We are about halfway at this 
point.
    Senator Feinstein. So, you have 2 more years.
    Ms. Harrington. Correct. I have to admit the continuing 
resolution situation that we have been in up until recently 
this year has presented some real challenges in terms of 
maintaining our schedule. We have deferred some other 
activities in order to keep these removals on schedule. We will 
have perhaps a little slippage, but not out of calendar years. 
We certainly are on track right now with Ukraine, Mexico, and 
Belarus to meet those high-level nuclear security summits 
commitments to remove all materials by the time we hit the 2012 
summit. So, we feel confident right now that we can make up----
    Senator Feinstein. You could make that 2-year goal.
    Ms. Harrington. We are on schedule to do that right now.
    Senator Feinstein. One quick question, are you prioritizing 
the sites?
    Ms. Harrington. Absolutely.
    Senator Feinstein. So, there is a list of priorities?
    Ms. Harrington. Correct.
    Senator Feinstein. Could we see that list please?
    Ms. Harrington. We can get that to you, yes.
    Senator Feinstein. Okay. Thank you very much.
    Mr. Vice Chairman? You go ahead, and then we will go back 
and forth.
    Senator Alexander. Okay. Thanks, Madam Chairman.
    Mr. D'Agostino, I would like to have just a little 
conversation with you about big projects and bringing them in 
on time and on budget. I mean, you have got a former mayor here 
and a former Governor here, so we are frustrated by the lack of 
executive opportunities we have in the U.S. Senate. So, this is 
a chance for us to weigh in.
    But you have got some really big things going on. I mean, 
the Uranium Processing Facility (UPF) is estimated to cost $4.2 
to $6.5 billion. That is a pretty big range. I mean, and a few 
years ago it was $1 billion, and then it was $2 billion, then 
it was $3 billion, and it is still going up. The Chemistry and 
Metallurgical Research Facility at Los Alamos, the range for it 
is $3.7 to $5.8 billion, and that is a massive range. And then 
we can go down the list of other big projects. Mixed oxide 
fuel, which is nearly $5 billion. The Life Extension Projects 
that is part of our nuclear modernization, those are $3 billion 
and $4 billion. So, these are big, big projects. And I remember 
the excitement that happened in Oak Ridge when the Spallation 
Neutron Source came in on time under budget, although it was a 
massive physics project.
    So, what can we do to be helpful to administrators, such as 
yourself, to set up a process by which we can take these big--I 
mean, I can add up at least $20 billion of projects over the 
next few years just in your area, and come up with a goal and a 
design, and then together we will see if we can stick to that 
goal and design and see if we can do it in a way that does what 
we need to do, but at the least possible cost.
    I know that is your objective, but sometimes that is hard 
to do in Government. What can we do to help you achieve that?
    Mr. D'Agostino. Senator Alexander, first of all thank you. 
I appreciate the opportunity to talk to executives in this 
fashion and get your insight as well.
    I think one of the main things as a subcommittee that you 
can do is give us the time to interact in sessions such as this 
and in other sessions where we can talk about, on a fairly 
regular basis, our progress, our plans, and our steps on 
meeting our, essentially, our collective objectives of 
providing the Nation the capability. The objective is not to 
spend all that money; that is not the objective. The objective 
is to get the capability for the Nation, as you said, in a 
fashion that gets it on time, on budget, and what the country 
needs to move forward. So, time with you, Sir, with the 
subcommittee as a whole, with you and your staff, and 
reporting, you know, on the appropriate basis is very helpful 
to us.
    Senator Alexander. But would not the first thing to do to 
be--to get a design and a cost estimate that you can live with? 
Would that be the first thing? How do we get to that point?
    Mr. D'Agostino. I basically see three broad steps that we 
are in the process of taking and either have completed or need 
to finish off on. One is getting our policy--project management 
policies correct. We have in the Department, most recently 
within the last year, and now are implementing in our projects, 
whether they are small dollar projects or billion dollar 
projects, a couple of key principles. And that is, we do not go 
off and declare what something is going to cost until we 
actually know what it is we are building and we have that 
design largely completed. Once that baseline is set, then it 
sticks. That would be one thing.
    The second thing is annual detailed independent peer review 
analysis. One of the things that we have learned from the 
Office of Science, which talked about the spatial neutron----
    Senator Alexander. Analysis of what, of the construction?
    Mr. D'Agostino. Of the construction project--of the project 
itself, independent peer reviews on an annual basis of the 
projects themselves, so this is something we are committed to 
doing. And, in fact, for two of these large facilities that we 
were just talking about, that is actually under way. My 
principal deputy, Neile Miller, sitting behind me, has started 
this type of an interaction and dialogue with the Defense 
Department, people outside of the NNSA and even outside of DOE, 
to bring project experts and other experts that independently 
check our work on a regular basis. That is another important 
policy element that we have in place.
    The next important thing is bringing the right people to 
bear on the problem. One of the great things that Neile Miller 
has brought to the table is looking at and recognizing that 
over the next 10 years, project management is our--has to be 
our key focus in this organization because that will define, 
first of all, can we----
    Senator Alexander. Well, let me not be rude and interrupt.
    Mr. D'Agostino. Yes.
    Senator Alexander. Let me go--get you to slim that answer 
down a little bit. I mean, what are the three steps you need to 
take? Do you not first need to design--you first you need a 
policy.
    Mr. D'Agostino. We have to get the policy right.
    Senator Alexander. Right.
    Mr. D'Agostino. We have to get a design----
    Senator Alexander. Then you have to get a design.
    Mr. D'Agostino [continuing]. That we have actually checked 
on, that has been independently checked to be true and been 
validated--independently checked and validated.
    Senator Alexander. Then you need a cost estimate, is that 
fair?
    Mr. D'Agostino. That cost estimate and the design will go 
together.
    Senator Alexander. So, those come together.
    Mr. D'Agostino. We have a schedule.
    Senator Alexander. So, once you have a policy and a cost 
estimate design, then you are ready to go, is that----
    Mr. D'Agostino. Then we are ready to go----
    Senator Alexander. Right.
    Mr. D'Agostino [continuing]. And then we will come back 
and----
    Senator Alexander. And then it is the regular review of 
your progress toward a goal.
    Mr. D'Agostino. Right.
    Senator Alexander. And our involvement in that--well, lets 
just--take these two examples of the UPF--I mean, there you 
have got $4.2 billion to $6.5 billion in the Chemistry and 
Metallurgical Building at Los Alamos, $3.7 to $5.8 billion. How 
soon before we get--is the policy set on those two projects?
    Mr. D'Agostino. Yes, it is, to get 90 percent design on 
those projects, yes, Sir.
    Senator Alexander. Okay. When we do we get 90 percent 
design on those two projects?
    Mr. D'Agostino. October 2012, is that right, Don?
    Dr. Cook. Yes. It is the end the end of fiscal year 2012.
    Senator Alexander. Yes, the end of next year----
    Mr. D'Agostino. Yes.
    Senator Alexander [continuing]. We will have our policy and 
our cost-estimate design at some number.
    Dr. Cook. That is correct. We are now just a bit beyond 50 
percent full engineering design on each of the two projects, 
chemistry and metallurgy research, UPF. Another step we have 
taken is to require actually the parent companies to integrate 
the design teams, look for common buys, gloves boxes we will 
use in both facilities, develop a plan of phasing that allows 
us to build--these are, after all, new nuclear builds. They are 
the hardest categories to replace capabilities really that have 
exceeded 60 years of age.
    Senator Alexander. Right. So by the end of next year there 
is a design and a cost estimate. But between now and then, what 
do we need to know about what you are doing to help you get a 
cost estimate you can live with? I mean, what do we need to be 
doing?
    Mr. D'Agostino. Well, Sir, you need--one of the things you 
will need to know is that we are not just resting on input we 
are getting from our M&O contractors. We are having these 
independently checked on one case, and we are probably going to 
have two independent checks because these are such large 
facilities. The one that we are doing with our colleagues in 
the Defense Department, and we will commission another 
independent check ourselves separately from that because one of 
the things I want to get us in the habit is under promising and 
over delivering, and when we make a commitment we deliver on 
that commitment.
    Senator Alexander. Well, we can continue this discussion 
another time. But to me, this boils down to a pretty simple 
thing, from our point of view, a very complex operation from 
yours. But it is to define the points where we get a real cost 
estimate and a real design and we say okay, that is it, you 
know. And we are then going to probably embark on a 3-, 5-, 6-, 
or 7-year period, right, of construction.
    Mr. D'Agostino. Yes, Sir.
    Senator Alexander. And so, during that period of time we 
should be having quarterly discussions about are you on 
schedule? If you are not, why not, so that we do not wind up 
and find that a $4 billion cost estimate ends up being a $7 
billion----
    Mr. D'Agostino. We would be happy to come up quarterly 
during the period of time as we get into construction in order 
to let you know the progress. We will be getting ourselves 
monthly updates on earned value as well. So, I think rolling it 
out on a regular basis so you have confidence that we are on 
track is----
    Senator Alexander. Madam Chairman, that sounds awfully 
primitive for me to suggest, but it is almost a matter of being 
that simple from our--I mean, if every 3 months all they have 
to report is we are under budget and we are on schedule, then 
the meeting might last 10 minutes. If it is not, why, it might 
take a longer period than that.
    Senator Feinstein. I understand that, right.
    Senator Alexander. So, I have some other questions, but I 
think I will stop now. Thank you for your courtesy.
    Senator Feinstein. Okay, all right. Let me just put my 
philosophy on the table, which I think you already know. I am 
not for new nuclear weapons. I will do everything I can to 
prevent the development of a new nuclear weapon. I want to see 
them gone all over the world, and I will support any program to 
get that done, and I think I have been fairly consistent. We 
have had this discussion before, and you know where I stand.
    Okay. As you know, the JASONs have found that most 
plutonium pits have a lifetime of at least 100 years. It is my 
understanding that once again you are planning to manufacture 
new plutonium pits for weapons undergoing life extensions. The 
question is why.
    Mr. D'Agostino. I will start and then I will pass to Dr. 
Cook to add to that with some details.
    The JASONs did validate the analysis that we have performed 
at our laboratories that pit aging is not the issue that we 
once thought it was 8--7, 8 years ago or so. And that is 
actually a great thing because had it been the case where 
plutonium aging was one of the things that we would have to 
more aggressively go after, we would be looking in--at a 
situation--looking at a different type of a problem on the need 
to have a higher pit production capacity.
    The plutonium production pit sustainment effort itself that 
Don's program runs has a large part, in my view, couple of 
components to it. One is bringing back and maintaining a 
capability, maintaining a very small set of expertise in order 
to--for the Nation to be able to respond to unknown technical 
changes as a result of dealing with this very unique material 
that is a manmade material that we have a fairly limited data 
set of knowledge on. It has been around for 60 plus years or 
so, and that is about all the information we have on it. So----
    Senator Feinstein. Let me cut to it. If the pits are all 
good, why do you want to manufacture new pits?
    Mr. D'Agostino. Don.
    Dr. Cook. Again, I think it was a very good question. Let 
me try to give a quick technical answer.
    JASON determined that the lifetime of the plutonium parts 
in pits are good for 100 years or 80 was their conclusion. Due 
to plutonium decay, which is by alpha--that is helium--that 
interstitially causes a potential problem.
    The actual problems that we have go well beyond that. We 
have the plutonium pits in the midst of the chemistry of high 
explosives with binders that decompose just like plastics in 
cars exposed to the sun. The plutonium is radioactive; the 
decay goes on. That degrades all of the plastics, all of the 
cushions, all of the things that are around the pit. And it 
also causes corrosion in the pit.
    So, on the one hand, JASON is absolutely correct about what 
they said, but the difficulty is that as weapons get older, 
much of the chemistry in a radiolitic environment starts to 
take over. And that has been the problem.
    Senator Feinstein. Yes.
    Dr. Cook. And we have invested many of the people and time 
in surveillance to actually pin down in which weapon systems we 
are seeing those kinds of problems, and we can predict how long 
they are good for. Those are not good for 100 years.
    Senator Feinstein. Well, I think I would like to have a 
discussion with the JASONs, and particularly SIDREL. I have 
discussed this in the past, and I would like to do it again, 
and I would like to do it with both of you present----
    Dr. Cook. I absolutely support that.
    Senator Feinstein [continuing]. And Senator Alexander, 
because I hear different things. It is fair to say that you all 
wanted to develop new nuclear weapons. That's what RRW 
essentially did. It was killed because of it, and I do not want 
to see, you know, RRW in disguise right now.
    Mr. D'Agostino. We would be glad to come up and talk to 
you, Senator, in a session. The key here are no new pit nuclear 
component designs and we are very consistent with that. I think 
Sid and I will be on the same page with this, but we would like 
to be able to show you personally.
    Senator Feinstein. Because what you have always led me to 
believe is that modernization is really for the protection of 
the workers who work around some of the chemicals that are 
extraordinarily dangerous and may be deteriorating. But I was 
under the express belief, based on some of our discussions, 
that all of these new pits that were requested some years ago 
were really forming the foundation of a new nuclear weapon, not 
just a modernized nuclear weapon.
    Mr. D'Agostino. Senator, I want to make sure I am clear on 
what our plan is on plutonium sustainment so there is no 
question about it.
    What we are planning on doing is manufacturing a pit design 
that we currently have in the stockpile of a particular warhead 
and wanting to--because those we have very few of. And we 
believe that in order to reduce the size of the stockpile, that 
particular pit design, which already exists--it is not a new 
pit--is going to be the pit design that will allow us to 
potentially consolidate the number of different types of 
warheads and allow us to reduce the overall number of warheads.
    Senator Feinstein. Okay.
    Mr. D'Agostino. That is the key.
    Senator Feinstein. So, how many pits are you talking about?
    Mr. D'Agostino. On the plutonium sustainment? Don, what--
are there 20 per year?
    Dr. Cook. The answer in terms of our capability----
    Mr. D'Agostino. Yes.
    Senator Feinstein. No, amount total to manufacture under 
this proposal.
    Dr. Cook. Let us see. We have been required by the 
Department of Defense, by U.S. Strategic Command, and by the 
requirements that we have laid to have a capability that is not 
less than 50 pits per year nor more than 80 for the----
    Senator Feinstein. So, are you saying to produce 50 to 80 
new pits a year?
    Dr. Cook. That to have not less than 50 and not more than 
80 is the----
    Senator Feinstein. Produced each year?
    Dr. Cook. That capability requires, yes, that is correct.
    Senator Feinstein. For a total of how many new pits?
    Dr. Cook. That is the number per year, and so if one 
calculates the number of years you would get that. It is 
consistent with the----
    Senator Feinstein. Calculated how many years?
    Dr. Cook. It is consistent----
    Senator Feinstein. Somebody must know how many pits you 
plan to make.
    Dr. Cook. Yes. It supports a stockpile of 3,000 to 3,500 
weapons in aggregate, the total as the Nuclear Posture Review 
and the national policy has laid out. Not that many will be on 
active alert, but that is the requirement for the total number 
including those----
    Senator Feinstein. So, what you are telling me is that the 
administration's design, or the Government's design, is that 
there are essentially 3,500. Well, I will not use the word new 
nuclear weapons, but with new pits essentially within what 
period of time?
    Dr. Cook. I--you know, I do not want to say that every one 
of those is a new pit. The capability that we are putting in 
place has that capability to manufacture that number of pits 
per atom--per annum, and the comparable number of secondaries 
in UPF at Y-12, if required. Overall, the capabilities support 
the stockpile as envisioned in the Nuclear Posture Review, the 
new START requirement. And the plan to continue to reduce the 
number of nuclear weapons----
    Senator Feinstein. To what?
    Dr. Cook. All together.
    Senator Feinstein. If you had these pits, how much would 
you reduce the stockpile by? I mean, this is important.
    Mr. D'Agostino. Yes, it is very important. We have a report 
called the Stockpile Stewardship Management Report. There is a 
section in it that is classified which goes system by system, 
and it talks about taking--there are two numbers there. One is 
obviously bigger than the other one. I would say just quick 
math off the top of my head, there is about, if you will, once 
the capability is in place, maybe a 40 percent reduction in the 
size of the stockpile.
    Senator Feinstein. I do not want you to do it off the top 
of your head as much as I think you are terrific.
    Mr. D'Agostino. Yes.
    Senator Feinstein. This is a big thing for me.
    Mr. D'Agostino. Sure.
    Senator Feinstein. I mean, it is one of the reasons why I 
am sitting right here--why I run for this office, because I 
want my grandchildren and their children to grow up in a 
nuclear-free world. I am going to do everything I can to be 
helpful to get there. So, this is not something that I am just 
going to fluff off and forget about.
    Mr. D'Agostino. Madam Chairman, I would say we have the 
details that we would like to share with you in the report that 
we provided, and we will go over that in great detail with you, 
with our Defense Department colleagues to show about the types 
of changes that we are--that we collectively are planning on 
making in our proposal, if you will, which this budget is a 
part of. It is--budget----
    Senator Feinstein. Because the way you have always sold 
your program to me is that if we do this, we can reduce the 
stockpile by more.
    Mr. D'Agostino. Yes, ma'am, that is the case.
    Senator Feinstein. You gave me some numbers before, but I 
did not think they were very sufficient. So, I want to know 
with this proposal and all this money you are getting, by how 
much will the nuclear stockpile be reduced?
    Mr. D'Agostino. We will be glad to go over that with you 
precisely by--with actual numbers and warheads.
    Senator Feinstein. Okay. Thank you.
    Senator Alexander.
    Senator Alexander. I have three questions, and they do not 
necessarily require long answers. But I would like to ask all 
three questions----
    Senator Feinstein. Go ahead.
    Senator Alexander. Mr. Administrator, I am a little puzzled 
by your single-mindedness on consolidating the contracts that--
at Y-12 and Pantex. I mean, they do not have overlapping 
missions. They both seem to be operating efficiently right now. 
You have got all these big projects to supervise and try to do 
as efficiently as possible. GAO has been studying the 
consolidation proposal, and a preliminary report suggests it is 
not a great opportunity for savings.
    Would it not be better to defer any decision about 
consolidation until we get the GAO report in July, and instead 
focus more of your time on working with the existing contractor 
to find savings and on other big projects where you might find 
savings?
    Mr. D'Agostino. Senator Alexander, we are committed to 
working with the existing contractor, and have worked with the 
existing contractor to identify savings, and have gotten--
received some input from the existing contractor, who is doing 
a very good job.
    We have been looking at ways to make sure that we run our 
enterprise in the most efficient and integrated fashion as 
possible. One of our views is that we are looking to have an 
enterprise, if you will, not eight independent sites make 
maximizing their capability at their sites. And, in fact, I 
have studied this for about 3 years. We did not just study it 
ourselves. We asked an external consultant known as Navigant 
Consulting, to take a look at what opportunities there are 
specifically at each of these sites, and what could the Federal 
Government realize from the standpoint of efficiency 
improvements, couched in dollar terms, of course, but our goal, 
of course, is to drive those resources into mission critical 
work and have the workforce realigned from that standpoint.
    So, we have done a study ourselves. We, in fact--we 
commissioned a completely independent study, which showed many 
hundreds of millions of dollars per year as an opportunity over 
the next 10 years that could be saved--many hundreds of 
millions of dollars.
    I have not seen the GAO study. I recognize that there was a 
press report I think that just came out recently. But what I 
will say is--and I am anxious to see it frankly because it is 
important for us, and this is why we are proceeding 
methodically to make sure we get input from the contractor 
community before we make a final decision. A decision will rest 
essentially with the--the Secretary and I will go through and 
we are going to conduct our external checks to make sure that 
things are done in an appropriate manner.
    This is probably, you know, one of the more important 
decisions we will be making this year, and I am committed to 
making sure that we have all the data. If the GAO has uncovered 
new information, I want to make sure that gets factored into 
our analysis and the like.
    I do believe in discussions that are very sensitive to the 
particular point on disruption of potential contract 
competition might have on very important work that is ongoing. 
And we have looked ahead at when we expect to be at the 90 
percent design points and what it will take to independently 
check those. And, as Dr. Cook mentioned, the end of next year 
is roughly a period of time that--where that comes to play. And 
it is clear we probably would not want to have any changes 
prior to that point because as--because of the disruption 
piece.
    But we have managed contract changes in the past, and we 
know it can be done in a way that does not impact the workforce 
and does not disrupt, more importantly, the workflow that 
happens there as well.
    Dr. Cook, if you have any other insights on this.
    Dr. Cook. I would just say we are paying particular 
attention to making sure that we are not doing anything to 
destabilize the UPF team or any of the M&O teams. They continue 
to do very high-quality work.
    With regard to the cost savings, it is not our objective to 
reduce the employment levels. It absolutely is our objective to 
increase productivity, not just through consolidation if 
appropriate of contracts, but the linking of the deliverables 
through all that we do. And we are studying that fairly 
intensely as you might normally expect.
    Senator Alexander. Thank you. The new mixed oxide fuel that 
will be produced at Savannah River--do you have any concerns 
about its safety if it is used in Tennessee Valley Authority 
reactors? And should it be less expensive fuel for the 
reactors, thus saving the Tennessee Valley Authority (TVA) rate 
payers money?
    Mr. D'Agostino. I will start, and then I will ask Dr. 
Harrington to follow.
    We have done, and there have been done a number of studies 
with respect to mixed oxide fuel. It is the material--fuel 
material that has been around for a while and has been in many 
tens of reactors worldwide and operating for more than 20 
years. So, I think the safety aspect of this is well 
established.
    We, of course, will continue to study this with potential 
buyers at TVA, for example, to make sure that they have 
complete and full access to any information they need to make 
sure that they are confident in that.
    Senator Alexander. My question simply is, is it safe to use 
it, and will it be cheaper----
    Mr. D'Agostino. Yes.
    Senator Alexander [continuing]. To use it?
    Senator Alexander. The answer is, yes, it is safe to use.
    Ms. Harrington. Yes, it is. And I think on the question of 
cost, obviously this is a nonproliferation program; it is not a 
commercial fuel program, so there is that difference. And the 
cost will be no more than and perhaps less than other 
commercially available fuel.
    Senator Alexander. Thank you. Madam Chairman, I have one 
other question, but I will defer to you for----
    Senator Feinstein. No, please. I think I have satisfied my 
questions, and I am going to follow up on the items of interest 
to me.
    Senator Alexander. I have got an idea you were going to do 
that.
    But my question is simply for the Admiral, and it goes back 
to what I said. The Navy operates small reactors, and it has 
about the same number of small reactors that we have civilian 
reactors around the country, all of which are large. In the 
civilian area, we speculate--I know Dr. Chu has talked about 
this--that a small reactor might be a useful way for the United 
States to move ahead with nuclear power, maybe 125, 150 
megawatt reactors. What can the Navy's experience with small 
reactors teach us about how we might move ahead in the civilian 
side with small reactors?
    Admiral Donald. Yes, Sir. Thank you for the opportunity to 
be here today.
    Senator Feinstein. Could you qualify small reactors?
    Senator Alexander. Well, a small reactor--a typical one 
like the new one, Watts Bar reactor being built at--by TVA is 
1,180 megawatts. A small reactor, such as the one that B&W 
proposes to build would be about 125 megawatts. And 125 
megawatts, Dr. Chu has talked about a small reactor of that 
size would be a lot cheaper to build, and it would be about 
enough power to operate the entire Oak Ridge complex, for 
example. The city, the laboratory, and the Y-12 facility might 
all operate with that one small reactor. The argument for it is 
it could be made in the United States, shipped to Oak Ridge or 
Alaska, wherever they want to use them. And if they needed two, 
they could put two side by side or three side by side. That is 
the argument for it.
    But with the Navy having all this experience since the 
1950s, so successful with small reactors, I wonder--if we are 
taking advantage of your experience or if this is one silo over 
here and this is another over here.
    Admiral Donald. Well, Sir, I think you really have to go 
back to the very beginning of the commercial nuclear power 
program. Where it started was with naval reactors. Amarico, we 
are building the shipping port plant in Pennsylvania. Really 
that design stemmed from what he had learned from building the 
Nautilus and subsequent submarine plants and the technology--
basic pressurized water reactor technology, which is one of the 
options for small modular reactors. That really was founded in 
the Naval Reactors Program and has been developed through the 
Naval Reactors Program with collaboration in commercial 
industry either directly or indirectly. We have had engagement 
with commercial industry over our history in design work and 
things of that sort. Indirectly there are a significant number 
of employees working in commercial nuclear who started in the 
Navy nuclear program. So, many of the standards and 
technologies and things that they learned in our program, they 
have transitioned into the commercial sector.
    With specific focus on the small modular reactors that are 
being discussed today, in fact Babcock and Wilcox, B&W, who 
is--has one of the options for a small modular reactor in 
power, I believe it is called, it just so happens that they 
also are one of our major suppliers, and they do much of our 
work. In fact, about 70 percent of our industrial base is 
really B&W type work that is done. So, there is some leveraging 
there of lessons that they have taken from building our plants, 
obviously with protecting our security, our classified 
information, but translating that into what could be a viable 
small modular reactor. So, I think that is a good synergy there 
if that is to be made to happen.
    I think there are those who--some have considered should we 
just transition naval reactors directly into small modular 
reactors, and the fact of that is that is probably not a good 
idea. Because of the standards that we build them to, we have 
to have shock standards that are significantly above what a 
commercial reactor would have to operate at.
    Our operating profile is very different from a commercial 
plant, so we design them for different ends, and they actually 
would likely not be cost effective for a commercial 
application. But again, the application and the synergy between 
the industrial base in the commercial world and the industrial 
base in the naval world I think provides opportunity for them 
to learn from what we have learned and provide opportunities in 
small modular reactors, if the commercial industry sees them as 
being feasible.

                     ADDITIONAL COMMITTEE QUESTIONS

    Senator Alexander. Thank you, Madam. Thank you, Admiral. 
Thank you, Madam Chairman.
    [The following questions were not asked at the hearing, but 
were submitted to the Department for response subsequent to the 
hearing:]

            Questions Submitted by Senator Dianne Feinstein

    Question. The National Ignition Facility (NIF) was supposed to 
demonstrate ignition by September 2010. However, the goal of achieving 
ignition has been postponed by more than 1\1/2\ years because of 
unexpected scientific and technical challenges.
    How confident are you that the NIF will achieve ignition by June 
2012? If this goal is not achieved by then, what does it mean for the 
future of the ignition program?
    Answer. Pending any unforeseen major technical challenges, I am 
confident in NIF's ability to achieve ignition by fiscal year 2012. NIF 
is currently operating on a schedule where as by the end of fiscal year 
2011, all of the experiments and capabilities required for the NIF to 
begin ignition experiments will be complete, and the goal is to 
demonstrate ignition, or ``gain equal to one'', by fiscal year 2012. 
``Gain equals one'' means the capsule will produce more energy than the 
amount of energy delivered to the target, also called the hohlraum.
    An National Nuclear Security Administration (NNSA) panel chaired by 
the Under Secretary for Science, Dr. Steve Koonin, has been formed to 
advise on technical progress, and the most recent review showed that 
the National Ignition Campaign (NIC) is making excellent technical 
progress. The principal focus is to ensure that a rapid, yet 
reasonable, amount of progress is being made on completing the 
scheduled ignition efforts. The NNSA's major concern is to ensure that 
further delays do not occur, except as a result of presently unknown 
technical issues that might have to be resolved. Ignition is a major 
technical challenge and the present NIF work is a culmination of 
decades of research. Should any unforeseen major technical issues arise 
that could potentially impact the goal of achieving ignition by fiscal 
year 2012, NNSA will re-evaluate and adjust the goals of the NIC 
accordingly.
    Question. NNSA owns 43 million square feet of physical 
infrastructure.
    What plans does NNSA have in place to reduce the footprint of the 
labs and production facilities and reduce maintenance costs?
    Answer. NNSA is continuing its footprint reduction efforts within 
available funding. The fiscal year 2012 Stockpile Stewardship and 
Management Plan conveys NNSA's strategy to consolidate and modernize 
the Nuclear Security Enterprise.
    NNSA has actively been working to comply with the Energy and Water 
Development Subcommittee fiscal year 2002 conference report 107-258 for 
reduction of footprint. For the period 2002 through 2009 NNSA 
constructed 1,447,865 gross square footage and eliminated 3,700,620 
gross square feet of facility footprint. The net result of these 
efforts is elimination of approximately 2,252,755 gross square feet of 
the NNSA footprint. NNSA will continue working to meet this requirement 
by reducing excess facilities as funds allow and by using footprint 
reductions to ensure the offset requirement is met.
    Question. NNSA has been criticized over the last several years for 
failing to maintain an adequate surveillance program, which is 
essential for determining the health of the nuclear weapons stockpile.
    To what extent has NNSA improved its surveillance program and 
addressed the concerns of the JASONs, lab directors, and the Department 
of Defense (DOD).
    Answer. Surveillance activities are essential to enabling continued 
certification of the reliability of the stockpile without nuclear 
testing. Surveillance involves withdrawing weapons from deployment and 
subjecting them to laboratory tests, as well as joint flight tests with 
the DOD to assess their reliability. These activities allow detection 
of possible manufacturing and design defects as well as material 
degradation over time. NNSA continues to implement a surveillance 
program that builds on those core activities, which allows us to 
support the current state of the stockpile, detect in advance potential 
problems, and take remedial actions.
    NNSA has reviewed the stockpile surveillance program and its 
funding profile. Since fiscal year 2009, the surveillance budget has 
increased by 50 percent, from $158 million to $239 million. In the 
fiscal year 2012 budget, the President seeks to sustain this increase 
and a more robust surveillance program throughout the fiscal year NSP.
    With this increased funding, many improvements have been made on 
surveillance. NNSA increased the number of planned laboratory and 
flight tests from 48 in fiscal year 2010 to 74 in fiscal year 2011. The 
total number of planned major surveillance activities (including pit, 
canned subassembly, gas transfer systems, detonator cable assembly 
tests and disassembly and inspection) also increased from 276 in fiscal 
year 2010 to 432 in fiscal year 2011. In addition, surveillance 
activities supported the development of diagnostic capabilities at Y-12 
for critical components of the nuclear explosive package. These 
capabilities will aid the current W76-1 production and surveillance of 
other warheads in the stockpile. This increased testing rate and 
improved diagnostics continue to be supported in the fiscal year 2012 
budget request. Furthermore, NNSA has taken action to hire a 
Surveillance Senior Technical Advisor, supported by an appropriate 
staff through a newly developed Surveillance Governance structure to 
assure a cohesive program, enables a cost-effective program, and 
integrates surveillance activities across the nuclear weapons 
enterprise. Together, the increased funding, additional focus, and 
hiring of a senior surveillance engineer should address the concerns 
expressed by the JASONs, laboratory directors, and DOD.
    Question. The JASONs found that most plutonium pits in nuclear 
weapons have a lifetime of at least 100 years. However, NNSA is 
planning to manufacture new plutonium pits for weapons undergoing life 
extensions.
    Why does NNSA have plans to manufacture new pits? What are the 
advantages and disadvantages?
    Answer. The Nuclear Posture Review (NPR) found that in order to 
sustain a safe, secure, and effective U.S. nuclear stockpile, for as 
long as nuclear weapons exist, the United States must possess a modern 
physical infrastructure and a highly capable workforce with the 
specialized skills needed to sustain the deterrent and support the 
President's nuclear security agenda.
    In 2006, the Los Alamos National Laboratory and Lawrence Livermore 
National Laboratory reported that the majority of pits in the stockpile 
can have estimated ``lifetimes'' in excess of 85 years or more based on 
the best estimates of plutonium changes with aging. All nuclear weapons 
generally and primaries specifically have other components with much 
shorter shelf lives that have to be maintained or replaced on a more 
frequent basis. Finally, as recognized by the JASONs and NNSA, the 
science of plutonium aging is not complete. The uncertainties in these 
estimates are large and contain significant variables which may affect 
plutonium and pit lifetime that are not yet fully understood. As the 
weapons age, they must be maintained in order to assure their 
reliability and extend their lives. Throughout this maintenance or life 
extension process, NNSA is directed by National Security Presidential 
Directive 28 to look for opportunities to enhance the safety and 
security aspects of the weapon (while still meeting the military 
requirements originally established for the weapon). One of the ways to 
enhance both safety and security is to move toward a stockpile that is 
based on insensitive high explosives (IHE) instead of conventional high 
explosives (CHE). IHE-based weapons are safer in almost every 
environment across the Stockpile-to-Target Sequence. Should NNSA 
receive authorization to proceed toward a totally IHE-based stockpile, 
we will need the ability to either manufacture these previously 
designed and tested pits or perform rework on existing pits.
    The current facility that NNSA manages for producing plutonium pits 
requires modernization to continue maintaining a ``safe, secure, and 
effective'' stockpile in the future. The manufacturing capacity will 
need to be increased to meet the anticipated requirement of 50-80 pits 
per year by 2022. The aging infrastructure is being addressed through 
TA-55 reinvestment. Additional programmatic investments will be 
required to develop and sustain the workforce required to execute the 
program at TA-55 in the coming years. What we are doing now is an 
effort to create a sustainable plutonium pit manufacturing capacity at 
the PF-4 facility that will be able to support the body of work 
addressed in the fiscal year 2012 Stockpile Stewardship and Management 
Plan. Moreover, the PF-4 facility is an important component of the 
administration's effort to provide a sustainable Nuclear Security 
Enterprise. Such a facility is one of the enablers for the United 
States to shift away from retaining large numbers of nondeployed 
warheads as a hedge against technical failure or geopolitical surprise.
    The pit manufacturing capability being pursued for PF-4 will 
provide NNSA the ability to produce a limited number of new pits, up to 
80 per year, or to perform rework on existing pits--this does not mean 
that each year we will exercise the full capacity of the facility. PF-4 
will provide NNSA with the minimum capacity to support the President's 
plan to life extend the stockpile. Per the NPR, each life extension 
program will be conducted on a case-by-case basis and we will study 
options for ensuring the safety, security, and reliability of each 
nuclear warhead. Our scientists, engineers, and technicians will study 
the full range of life extension approaches, to include refurbishment 
of existing warheads, reuse of nuclear components from different 
warheads, and replacement of nuclear components. In any decision to 
proceed to engineering and development, strong preference will be given 
to the refurbishment and reuse approaches. However, we may not be able 
to meet some critical Stockpile Stewardship and Management Plan goals, 
such as increased safety, security, and reliability, using those two 
approaches. In such cases, replacement of nuclear components will be 
pursued, but only when specifically authorized by the President and 
approved by the Congress.
    Possessing the ability to manufacture plutonium pits provides many 
advantages to the Nation and to NNSA. We are able to exercise and 
retain the highly skilled workforce of scientists, engineers, and 
technicians central to a responsive manufacturing capability. Further, 
we retain the agility necessary to respond to technical or geopolitical 
issues in a timely manner, allowing us to retain a smaller hedge. The 
pit manufacturing and rework capability presents opportunities to take 
advantage of safety and security advancements to make the stockpile 
safe, secure, and reliable.

                            FOUR-YEAR EFFORT

    Question. April 2011 was the half way mark of the goal of securing 
all vulnerable nuclear materials in 4 years.
    Is NNSA still on track to achieve this goal in 4 years?
    Answer. NNSA is currently on track to complete the objectives 
outlined in its 4-year effort. NNSA's progress to secure and eliminate 
nuclear material is described in more detail in the classified ``Report 
to Congress on Securing Vulnerable Nuclear Material'' submitted jointly 
in April 2011 by NNSA and DOD. Although the focused 4-year effort ends 
in 2013, nuclear security is an enduring responsibility as long as any 
material exists, and NNSA programs will continue to be guided by the 
evolving threat environment.
    NNSA plays a major role in the international effort to secure the 
most vulnerable nuclear material around the world in 4 years, working 
in coordination with DOD, the Department of State, the Nuclear 
Regulatory Commission (NRC), other elements of the U.S. Government, and 
international partners. NNSA programs have made significant progress 
toward achieving key programmatic goals for securing and eliminating 
weapons-usable nuclear material. NNSA's accomplishments include the 
following:
  --Removed approximately 3,085 kilograms of weapons-usable highly 
        enriched uranium (HEU) and plutonium from countries around the 
        world, including 960 kilograms--enough material for 38 nuclear 
        weapons--since April 2009.
  --Completed security upgrades at 32 buildings containing weapons-
        usable material in Russia and initiated new insider threat 
        upgrades at 15 facilities in Russia since April 2009.
  --Completed shipments of spent fuel from Kazakhstan's BN-350 
        plutonium production reactor to a secure facility in eastern 
        Kazakhstan in 2010. The spent fuel contains enough HEU and 
        weapons-grade plutonium for 775 nuclear weapons.
  --Advanced efforts to establish Centers of Excellence (COE) for 
        nuclear security with China, India, Japan and the Republic of 
        Korea, working in coordination with DOD, NRC, and Department of 
        State. The COEs will provide national, regional, and 
        international training and workshops on nuclear security best 
        practices; demonstration of available and effective nuclear 
        security technologies; nuclear security research and 
        development; legal and regulatory frameworks; and bilateral 
        and/or regional nuclear security initiatives.
    Question. What specifically does NNSA hope to achieve at the end of 
those 4 years?
    Answer. NNSA has a number of programmatic goals in support of the 
broader international 4-year effort, including the following:
  --Complete the removal of approximately 3,615 kilograms of weapons-
        usable nuclear material cumulatively from sites around the 
        world by the end of 2013.
  --Complete Material Protection Control and Accounting (MPC&A) 
        upgrades at a cumulative total of 229 buildings with Category I 
        nuclear material by the end of fiscal year 2013. However, 
        security upgrades at additional buildings after 2013 may be 
        needed, as U.S. programs are guided by the evolving threat 
        environment.
  --Continue working with DOD, NRC, and the State Department to support 
        the establishment of Centers of Excellence for nuclear security 
        with key international partners.
  --Contribute to key global initiatives, including the Nuclear 
        Security Summit in 2012, the Global Initiative to Combat 
        Nuclear Terrorism, the implementation of United Nations 
        Security Council Resolution 1540, and the G-8 Global 
        Partnership.
  --Lead efforts to implement the fifth revision of the nuclear 
        security recommendations document INFCIRC/225, ``The Physical 
        Protection of Nuclear Material and Nuclear Facilities'', which 
        will ensure strengthened physical protection of nuclear 
        material and facilities worldwide.
    Question. How does NNSA prioritize to determine which nuclear 
materials in which countries are the most vulnerable and need to be 
secured first?
    Answer. NNSA prioritizes its efforts to secure and eliminate 
vulnerable nuclear material based on a number of factors, including 
nuclear material attractiveness (amount and form of the material), the 
existing site security conditions, the assessed country threat 
environment, and political opportunity.
    Question. What are the most significant challenges in securing the 
highest-risk materials?
    Answer. NNSA works with other countries to minimize the civilian 
use of HEU, eliminate unneeded weapons-usable nuclear material, and 
improve security of nuclear material by providing equipment and 
training. In many cases, getting direct access to facilities to carry 
out such work can be a challenging process. Sometimes, direct access to 
facilities is not possible or appropriate, and NNSA works with other 
elements of the U.S. Government on alternative approaches to improve 
security of nuclear material such as regional centers of excellence for 
nuclear security and support for global initiatives.
    In addition, these NNSA programs are voluntary in nature, so each 
country must first agree that it would like to cooperate with NNSA on 
nonproliferation activities. In some isolated instances, a country has 
decided that it does not wish to participate. In these instances, NNSA 
looks to other organizations such as the International Atomic Energy 
Agency to help facilitate nonproliferation efforts in that country.

                         MATERIAL CONSOLIDATION

    Question. What is NNSA doing to consolidate nuclear materials to a 
much smaller and easier-to-protect number of sites and buildings, 
especially in Russia?
    Answer. Under the International Nuclear Materials Protection and 
Cooperation Program (INMP&C), NNSA is continuously promoting the 
benefits of nuclear material consolidation with its partner countries 
and especially within the Russian nuclear complex. In May 2010, INMP&C 
held a Nuclear Material Consolidation Best Practices workshop, with 
presenters from the NNSA complex and the Rosatom complex to exchange 
lessons learned regarding the consolidation of nuclear materials. The 
NNSA, through INMP&C, has also hosted Russian officials, including the 
head of Rosatom, Sergei Kiriyenko, to tour the Highly Enriched Uranium 
Materials Facility at Y-12 and discuss the cost savings that will be 
achieved by conducting this major consolidation effort.
    It is standard operating procedure to evaluate intra-site 
consolidation at every Russian site participating in INMP&C cooperation 
and to support such consolidation when the sides can identify and agree 
to an effective approach. INMP&C has supported the removal of all HEU 
from one Russian site and has significantly reduced the number of 
buildings requiring protection by supporting the consolidation of 
nuclear material within sites in Russia. Moreover, INMP&C is currently 
supporting a large intra-site consolidation activity at one Russian 
site, and such activities are under consideration with several other 
Russian sites. In addition, U.S. project teams from INMP&C look for 
opportunities to transfer excess, nonweapons HEU out of facilities, 
thereby decreasing the amount of material requiring protection.
    The excess HEU transferred from sites is usually downblended into 
low-enriched uranium (LEU) under INMP&C's Material Consolidation and 
Conversion (MCC) Project. To date, that project has supported the 
downblending of almost 14 metric tons of nonweapons HEU to LEU. On a 
cost-sharing basis with Russia, the MCC Project is also supporting the 
creation of additional downblending capacity at one Russian site in 
order to increase the amount of excess nuclear material that can be 
consolidated and then downblended into LEU. For this activity, Rosatom 
will fund the additional downblending line, and the MCC Project will 
support the associated security requirements. This additional capacity 
is expected to become operational at the end of calendar year 2012. In 
addition, the MCC Project continues to support the downblending of 
returned Russian-origin fuel that has been consolidated from the FSU 
and other countries. The MPC&A management is currently discussing with 
Rosatom the potential to include additional excess material under the 
MCC Project, which would remove significant quantities of such material 
from four sites.

                         TECHNOLOGICAL SURPRISE

    Question. A national security concern is always technological 
surprise. In particular, the United States needs the best information 
possible on the nuclear weapons activities of foreign countries.
    What has NNSA done to increase our capabilities to monitor the 
nuclear weapons capabilities of other countries, such as Iran?
    Answer. NNSA has a long-standing research and development (R&D) 
program focused on improving U.S. nuclear security through the 
development of novel technologies to detect foreign nuclear weapons 
proliferation/detonation and verification of foreign commitments to 
treaties and agreements.
    Using the unique facilities and scientific skills of the NNSA 
Nuclear Security Enterprise as well as other DOE National Laboratories, 
in partnership with industry and academia, the program sponsors R&D to 
support U.S. nuclear nonproliferation policies and programs by closing 
technology gaps identified through close interaction with NNSA and 
other U.S. Government agencies and programs.
    Specifically, NNSA provides technical expertise and leadership 
toward the development of next-generation nuclear detection 
technologies and methods to detect foreign nuclear materials and 
weapons production. Through the development of new tools, technologies, 
and techniques designed for the detection, location, and analysis of 
global proliferation of nuclear weapons technology with special 
emphasis on verification technology and transparency measures, NNSA 
provides the Nation--both unilaterally and multilaterally--with the 
technical means to monitor foreign nuclear weapons programs.
    Question. How confident are you that the United States has the 
means to detect a nuclear weapons test in another country?
    Answer. NNSA, and its predecessor agencies, have more than 50 years 
of history in developing the leading technologies used by the United 
States to monitor and verify foreign nuclear testing. Working 
intimately with the Department of Defense and other U.S. Government 
agencies, NNSA develops and builds all space-based nuclear detection 
equipment. This equipment, which continuously monitors the globe, is 
operated by the U.S. Air Force for the Nation.
    Further, NNSA develops other leading-edge technologies, such as 
seismic sensors and radionuclide and particle collection systems for 
the detection of a foreign nuclear test. Like the space-based sensors, 
these ground-based systems are operated by the U.S. Air Force.
    Where applicable, and in keeping with the President's nuclear 
security agenda, NNSA transfers some of these technologies to 
international nuclear monitoring organizations, such as the 
International Atomic Energy Agency and Comprehensive Test Ban Treaty 
Organization.
                                 ______
                                 
               Questions Submitted by Senator Jon Tester

    Question. Administrator D'Agostino, it's my understanding that the 
National Nuclear Security Administration (NNSA) shares jurisdiction 
over fusion energy research with the Department of Energy's Office of 
Fusion Energy Sciences (OFES). In Montana, the Plasma Physics Group at 
the University of Montana is currently conducting research with an 
emphasis on magnetic fusion. The University of Montana Plasma Physics 
Group and other university programs are researching fusion energy in 
conjunction with many of our National Laboratories including the 
Princeton Plasma Physics Laboratory, the Lawrence Livermore National 
Lab and the National Ignition Facility (NIF). I, and many others, are 
eagerly awaiting the results of the NIF full ignition tests this year.
    In 1980, the Congress passed an authorization bill that envisioned 
a demonstration fusion power plant by the year 2000. That clearly did 
not happen. Today, China, South Korea, and many European nations are 
investing in and advancing fusion energy research, with the hopes of 
commercialization. Commercialization of fusion energy could assist our 
Nation in achieving energy independence, and would undoubtedly lead to 
job creation in whichever nation accomplishes it.
    What are the resources in fiscal year 2011 that NNSA is currently 
providing for the advancement of fusion energy?
    Answer. Thermonuclear fusion is pursued at the Department of Energy 
and NNSA for two important and different purposes. OFES, in the Office 
of Science, is pursuing fusion science for eventual energy 
applications.
    NNSA pursues Inertial Confinement Fusion (ICF) in support of 
Stockpile Stewardship. Thermonuclear fusion is the essential process of 
all U.S. nuclear weapons. Much of SSP inertial confinement fusion 
research can provide information relevant to inertial fusion energy, so 
it can be thought of as dual use. NNSA built and operates its large 
high-energy density facilities to support the stockpile. If successful, 
ignition on the NIF will demonstrate that ICF in the laboratory is 
feasible and, as a side-benefit, will be an important advance for 
fusion energy. Other areas of the ICF program may help develop the 
fundamental science of inertial fusion energy, including research on 
direct drive and pulsed power fusion.
    NNSA requested $481.5 million in fiscal year 2011 for the ICF 
Ignition and High Yield Campaign. The ICF fiscal year 2011 budget is 
$477.6 million. We have requested $476.3 million for fiscal year 2012.
    This year NIF is focusing on experimentally optimizing the laser 
and target conditions as part of the National Ignition Campaign (NIC) 
and has made significant progress. We expect to perform full ignition 
tests in the fiscal year 2012 to 2014 window. NIF is also focusing on 
material properties under extreme conditions and on finishing up work 
to validate codes devoted to the energy balance problem.
    Question. How much additional funding would NIF require for full 
commercialization within the current framework?
    Answer. When NIF achieves ignition, it will establish the 
scientific basis for inertial confinement fusion, but will not have the 
performance required for the energy mission. The NIF was not designed 
to be converted to a prototype commercial reactor. Significant 
technical development, independent economical studies, and licensing 
processes will be required beyond the demonstration of ignition on the 
NIF for inertial fusion energy. In addition, the demonstration of 
ignition at NIF does not guarantee that this would be commercially 
viable.
    This year NIF is focusing on experimentally optimizing the laser 
and target conditions as part of the National Ignition Campaign (NIC) 
and has made significant progress. We expect to perform full ignition 
tests in the fiscal year 2012 to 2014 window. NIF is also focusing on 
material properties under extreme conditions and on finishing up work 
to validate codes devoted to the energy balance problem.
    Several approaches to achieving thermonuclear fusion are being 
pursued. In NNSA, we are pursuing indirect drive for the first 
demonstration of ignition on the NIF and polar direct drive as an 
alternate approach led by the University of Rochester. The Naval 
Research Laboratory is engaged in direct drive research with an 
alternate laser driver using a Krypton Flouride laser, and pulsed power 
fusion research is conducted at Sandia National Laboratories. In the 
Office of Science, heavy ion fusion, fast ignition, and other 
approaches are being pursued.
    DOE has asked the National Academy of Sciences (NAS) to conduct a 
review on inertial fusion energy and to make recommendations on how 
best to pursue inertial fusion energy as a long-range energy option 
after the demonstration of NIF Ignition. NAS will assess the prospects 
for generating power using inertial confinement fusion, and will 
identify scientific and engineering challenges and cost targets. We 
look forward to receiving the panel's interim report, expected in 
September 2011.
    Question. What are NNSA's goals for fusion energy in fiscal year 
2012 and beyond?
    Answer. NNSA's goal for the National Ignition Campaign (NIC) is to 
demonstrate ignition on the NIF. In fiscal year 2012 and beyond, NNSA 
will work to improve ignition performance and develop advanced ignition 
concepts and platforms that further its Stockpile Stewardship mission. 
NNSA will continue to provide peer-reviewed access to it major 
facilities (NIF, Omega, and Z), which includes work in support of 
inertial fusion energy as well as basic science. The Department will 
review the report from NAS on ICF, and use the report's findings to 
inform our decision on how to proceed with a program in inertial fusion 
energy.
    This year NIF is focusing on experimentally optimizing the laser 
and target conditions as part of the NIC and has made significant 
progress. We expect to perform full ignition tests in the fiscal year 
2012 to 2014 window. NIF is also focusing on material properties under 
extreme conditions and on finishing up work to validate codes devoted 
to the energy balance problem.
    Question. Can you detail the collaboration between NNSA and OFES?
    Answer. The main mechanism for collaboration between the OFES and 
NNSA's Inertial Confinement Fusion (ICF) program is the Joint Program 
in High Energy Density Laboratory Plasmas. High-energy-density 
laboratory plasma physics is the study of matter at extremely high 
density and temperature; it is a broad and rapidly growing area of 
research that includes ICF, laboratory astrophysics, materials 
properties under extreme conditions, and warm dense matter. Through the 
joint program, OFES and the ICF programs conduct peer-reviewed 
solicitations for basic high-energy density research and organize 
scientific workshops. In fiscal year 2011, the joint program provided 
support for 50 research awards in more than 30 institutions.
    This year NIF is focusing on experimentally optimizing the laser 
and target conditions as part of the NIC and has made significant 
progress. We expect to perform full ignition tests in the fiscal year 
2012 to 2014 window. NIF is also focusing on material properties under 
extreme conditions and on finishing up work to validate codes devoted 
to the energy balance problem.
    Question. What is the current backlog of fusion energy related 
experiments and what can be done to advance them?
    Answer. In the near term, NNSA's ICF program will concentrate on 
achieving ignition in the NIF. This is an essential step for stockpile 
stewardship, and will also contribute to developing fusion energy. 
Achieving ignition will be a great technical accomplishment and will 
establish the scientific feasibility of inertial fusion energy. The 
development of inertial fusion energy is not part of NNSA's mission 
and, as such, no backlog of experiments exists.
    This year NIF is focusing on experimentally optimizing the laser 
and target conditions as part of the NIC and has made significant 
progress. We expect to perform full ignition tests in the fiscal year 
2012 to 2014 window. NIF is also focusing on material properties under 
extreme conditions and on finishing up work to validate codes devoted 
to the energy balance problem.
    Fusion energy has proven to be a daunting and elusive goal. In 
support of this goal, however, recently NAS' Committee on Inertial 
Fusion Energy (IFE) has been asked to:
  --Assess the prospects for generating power using inertial 
        confinement fusion;
  --Identify scientific and engineering challenges, cost targets, and 
        R&D objectives associated with developing an IFE demonstration 
        plant; and
  --Advise DOE on its development of an R&D roadmap aimed at creating a 
        conceptual design for an inertial fusion energy demonstration 
        plant.
    The Department will evaluate the recommendations from the 
subcommittee before deciding how to proceed.
    Question. Where does our domestic fusion energy research stand in 
comparison to China, South Korea, and other nations?
    Answer. NNSA is the world leader in inertial confinement fusion 
research, which we primarily conduct to support Stockpile Stewardship. 
France and the United Kingdom also have strong programs in inertial 
confinement fusion to support their nuclear weapons stockpiles. France 
is building a NIF-scale laser facility named Laser Mega Joule (LMJ). 
The UK has built a smaller laser facility named Orion. The Japanese 
conduct research in inertial fusion for energy applications and have a 
modest-size laser named FIREX I. Germany conducts research in heavy ion 
fusion. The European Community has proposed the HiPER project to build 
an inertial fusion energy research program. China is active in high-
energy density physics and is building a new large laser system at a 
Government laboratory. This laser will be smaller than NIF and is not 
likely to achieve ignition. A number of countries have modest z-pinch 
pulse power programs for fusion. We are not aware of any substantial 
ICF program in Korea. Many of the countries mentioned also have 
significant magnetic energy fusion programs, and the OFES could provide 
a detailed comparison for those technologies.
    This year NIF is focusing on experimentally optimizing the laser 
and target conditions as part of the NIC and has made significant 
progress. We expect to perform full ignition tests in the fiscal year 
2012 to 2014 window. NIF is also focusing on material properties under 
extreme conditions and on finishing up work to validate codes devoted 
to the energy balance problem.
                                 ______
                                 
             Questions Submitted by Senator Lamar Alexander

                       EXPORT CONTROL REGULATIONS

    Question. National Nuclear Security Administration (NNSA) is 
responsible for implementation of export control regulations under 10 
CFR 810 which authorizes transfer of peaceful nuclear technology. The 
number of specific authorizations issued by Department of Energy under 
10 CFR 810 has roughly tripled over the past 5 years and industry has 
recently noted that the amount of time required for issuing these 
authorizations has increased significantly as well. These delays have a 
negative impact on the ability for U.S. firms to compete in the global 
nuclear marketplace currently estimated to exceed $50 billion per year.
    While industry has remarked on the professionalism and dedication 
of NNSA staff, is the agency sufficiently staffed to respond the 
increasing number inquiries and authorizations requested?
    Answer. Pursuant to section 57b of the Atomic Energy Act, the 
Secretary of Energy must authorize all U.S. persons who wish to engage 
directly or indirectly in the production of special nuclear material 
outside the United States, provided that the assistance is not inimical 
to the interests of the United States. The Secretary of Energy's 
authority is nondelegable. The implementing regulation for section 57b 
of 10 CFR part 810 also requires DOE to address eight specific 
questions to determine whether proposed assistance raises proliferation 
concerns. Besides the analysis of the eight specific questions in the 
regulation, the Department also requests via the State Department, 
foreign government assurances from the recipient's government that 
state that the assistance will be for peaceful, nonmilitary purposes, 
will not be retransferred without U.S. consent, and that the resulting 
nuclear material will be under IAEA safeguards. These assurances are 
consistent with the requirements of section 123 of the Atomic Energy 
Act and the nuclear suppliers group.
    Over the past few years, as the global nuclear industry has seen 
resurgence in business opportunities, the number of part 810 
applications has increased accordingly. In 2007, the Department 
authorized 1 specific authorization; in 2010, the Department authorized 
15. In addition to an increase in the number of applications, the 
complexity of the applications has also increased as nuclear commerce 
has become more globalized. Each specific authorization requires 
approval by the Secretary and must include an in-depth technical and 
policy analysis addressing the eight questions in the regulation. 
However, a vast amount of nuclear commerce that takes place with our 
close trading and nonproliferation partners takes place under general 
authorization provisions of 10 CFR part 810 and does not require the 
same intensive analysis by the Department's staff. The Department has 
recognized the increase in part 810-related activities by U.S. industry 
and has brought on qualified and experienced staff to help adjudicate 
these applications. The Department believes that it has the staff in 
place to address the 810 applications that it currently receives and 
has plans for streamlining its review processes to enable timelier 
responses to industry's applications.
    Question. If so, why are these delays increasing and what plan does 
DOE have in place to make the 810 process more efficient?
    Answer. One significant reason for the delays has been the lack of 
prompt government assurances from our foreign partners. Some of the 
assurances, especially from China and India, have taken more than 18 
months to obtain. Without these assurances the Secretary would have 
been unable to make the legally required noninimicality finding, and 
the United States would not have been acting in accordance with the 
nuclear suppliers group guidelines. We are working with the State 
Department and applicants at the beginning of the part 810 process to 
identify where potentially long delays may arise. We are also working 
to structure applications in such a way that will enable us to 
efficiently and effectively authorize the assistance within the bounds 
of U.S. law and policy. We have also instituted new policies, such as 
the ``deemed export'' process through which we have been able to find 
ways to satisfy the requirements of the Atomic Energy Act for companies 
that wish to employ foreign nationals in the United States, thus 
alleviating one class of applications, which we had been unable to 
process at all in the past.
    Question. If not, what process improvements does DOE plan to put in 
place to make the 810 process more efficient?
    Answer. The Department is also looking at how the nuclear industry 
does business in a globalized world and is reviewing potential 
amendments to the part 810 regulation to reflect today's realities. The 
part 810 regulation has remained essentially the same for more than 25 
years. It was designed and implemented at a time in the U.S. nuclear 
industry's history that is vastly different from how industry works 
today or will work in the future. We recognize that the part 810 
regulations need to be more user-friendly and consistent with current 
U.S. nonproliferation policies.

           NAVAL REACTORS FACILITY, IDAHO NATIONAL LABORATORY

    Question. The Naval Reactors Facility (NRF), located at the Idaho 
National Laboratory (INL), is responsible for fuels and materials 
research and development, and processing, analyzing, and storing 
reactor cores that are removed from aircraft carriers or submarines at 
refueling and decommissioning. NRF's location within the laboratory 
boundaries enables the Navy to utilize the laboratory's capabilities, 
such as the Advanced Test Reactor and the Idaho Nuclear Technology and 
Engineering Center to fulfill mission requirements.
    Please describe:
  --which non-NNSA facilities at INL are used by the Naval Reactors 
        Program;
  --the type of work performed for the program at each facility, and 
        whether it is performed by the Navy or others;
  --a comparison of the work at each facility performed by or for the 
        Navy to the work performed by all other users in the aggregate, 
        expressed as a percentage for each facility; and
  --whether each facility is essential to the mission of the program.
    Answer. Naval reactors uses the following facilities at INL:
Advanced Test Reactor
    Naval reactors utilizes Advanced Test Reactor (ATR) for materials 
research and fuel system development. Naval Reactors Facility (NRF) at 
INL prepares ``test trains'' that contain materials destined for 
irradiation. The NRF ships those test trains to ATR. The ATR personnel 
receive the test trains, insert them into the reactor, operate the 
reactor, remove the test trains from the reactor, and ship the test 
trains back to NRF. The data generated at ATR is needed to support the 
operational fleet, support reactors currently being designed, and 
develop fuel and poison systems for future reactors. For example, 
testing currently underway to support the newly designed, reduced-cost 
VIRGINIA forward fit (VAFF) core procurement will provide data needed 
to develop operational limits, casualty procedures, refueling limits, 
and shipping requirements that ensure safe and efficient operation of 
our nuclear plants at sea.
    In fiscal year 2012, the Naval Nuclear Propulsion Program (NNPP) 
will provide $64 million to ATR, representing approximately 62 percent 
of ATR operations.
    ATR is essential to the NNPP mission.
Idaho Nuclear Technology and Engineering Center
    Some naval spent nuclear fuel is currently stored at Idaho Nuclear 
Technology and Engineering Center (INTEC). The INTEC personnel are 
currently preparing that fuel for dry storage, loading it into uniquely 
designed baskets, loading those baskets into shipping containers, and 
shipping those containers back to NRF. INTEC is also preparing and 
shipping naval transuranic waste for disposal at the Waste Isolation 
Pilot Plant. The INTEC facility is needed to support NNPP commitments 
to the State of Idaho in the 1995 Settlement Agreement and the 2008 
Settlement Addendum. Failure to meet these commitments will potentially 
prevent NNPP from receiving fuel at NRF, which would prevent NNPP from 
refueling and defueling nuclear powered warships.
    In fiscal year 2012, NNPP will provide $22.3 million of INTEC 
funding, which represents approximately 21 percent of INTEC operations.
    INTEC is essential to the NNPP mission.
Radioactive Waste Management Complex
    NNPP disposes of remote-handled low-level radioactive waste (RH-
LLW) at Radioactive Waste Management Complex (RWMC). Operations at NRF 
will continue to produce these wastes indefinitely. NNPP generates 
approximately one-half of the RH-LLW that is disposed at RWMC. RWMC, 
and the planned replacement, are essential to the NNPP mission. The 
RWMC is the only cost-effective disposal path for this waste. Without a 
disposal path, waste will collect within the ECF water pool and 
eventually preclude spent-fuel processing operations. Spent-fuel 
processing is essential to unload shipping containers that support 
refueling and defueling nuclear warships and meeting NNPP commitments 
to the State of Idaho in the 1995 Settlement Agreement and the 2008 
Settlement Addendum. If RWMC suspended operations, Naval Reactors would 
be forced to dispose of low-level radioactive waste off-site, at a 
significantly higher cost.
    NNPP will contribute to the construction costs for a planned 
replacement facility.
    The work done at RWMC and the work that will be done at RMWC's 
replacement is essential to NNPP mission.
Materials and Fuels Complex
    NNPP occasionally contracts examination of expended core and ATR 
test specimens to Materials and Fuels Complex (MFC) when detailed 
analytical chemistry services are required to obtain the needed data. 
These examinations require use of the MFC hot cell facilities and 
analytical chemistry laboratories. These examinations are essential to 
the NNPP mission. There are other analytical chemistry laboratories 
(e.g., ORNL) that could perform these examinations; however, shipment 
costs would be significantly higher. NNPP plans to ship specimens to 
MFC for analytical chemistry evaluations in 2015. In the future, the 
NNPP plans to make use of MFC capabilities (currently in development) 
to perform focused ion beam machining, transmission electron 
microscopy, and atom probe evaluations of irradiated material. Using 
MFC capabilities eliminates the need for NNPP to develop these 
capabilities at NRF or ship the materials for examination offsite.
    The percentage of MFC's work that supports naval work varies from 
year to year.
    The work done at MFC is essential to the NNPP mission.
    NNPP also subcontracts many site services (e.g., fire department 
and emergency services) to INL contractors that require use of various 
INL facilities. The total value of these services is $17 million in 
fiscal year 2011. In addition to this, in fiscal year 2011, NNPP 
initiated a permanent annual budget transfer of $1.5 million for 
security and safeguards at INL. These services are essential to support 
operations at NRF. If INL were not able to provide these services, the 
NNPP would need to develop and fund these capabilities independently.
    Question. Please describe the effect that suspending operations at 
the facilities described in question one would have on NRF and the 
Navy's ability to perform mission work.
    Answer. Suspending operations at each of the facilities would have 
the following impacts:
      Advanced Test Reactor.--If ATR suspended operations, Naval 
        reactors would be unable to attain the information required to 
        resolve problems as they arise in the operating fleet, unable 
        to develop or improve future fuel systems and materials 
        applications, and unable to develop the life-of-ship core 
        required for the Ohio Replacement SSBN.
      Idaho Nuclear Technology and Engineering Center.--If INTEC 
        suspended operations, Naval reactors would be unable to meet 
        the terms of its agreements with the State of Idaho, placing in 
        jeopardy the ability to refuel and defuel nuclear powered 
        warships.
      Radioactive Waste Management Complex.--If RWMC suspended 
        operations, Naval reactors would be forced to dispose of low-
        level radioactive waste offsite, at a significantly higher 
        cost.
      Materials and Fuels Complex.--If MFC suspended operations, Naval 
        reactors would be forced to contract for equivalent 
        examinations offsite at significantly higher costs.
    Question. Please describe in detail the amounts and sources (e.g. 
DOD or DOE) of funding the program contributes for the use of the 
facilities described in question 1, including any funding or transfers 
provided for INL's safeguards and security program.
    Answer.

                          [Dollars in millions]
------------------------------------------------------------------------
                                                           Fiscal year
                        Facility                           2012 funding
------------------------------------------------------------------------
ATR....................................................         \1\ 64.0
INTEC..................................................         \2\ 22.0
RWMC...................................................          \1\ 0.8
MFC....................................................  ...............
Site services (e.g. mail, EMS, fire)...................         \3\ 17.0
Safeguards and security................................          \4\ 1.5 
------------------------------------------------------------------------
\1\ DOE.
\2\ Navy.
\3\ DOE fiscal year 2011.
\4\ Permanent annual budget transfer.

                     SMALL MODULAR REACTORS PROGRAM

    Question. The Navy has a unique expertise in designing, building, 
and maintaining modular reactors or use on their vessels, in addition 
to an impeccable safety record.
    Given this expertise, could you describe what role, if any, the 
Naval Reactors program will (or could) play in DOE's planned Small 
Modular Reactor program?
    Answer. Since 1955, the Naval Nuclear Propulsion Program (NNPP) has 
provided militarily effective nuclear propulsion plants and ensured 
their safe, reliable, and long-lived operation. NNPP's reactors are 
designed to meet requirements associated with their military-unique 
application, and are not suitable for commercial use. However, there 
are areas for cooperation and possible technology transfer between 
NNPP, other Government agencies, and industry. NNPP and the Office of 
Nuclear Energy will continue to seek opportunities to collaborate and 
share information with each other and other appropriate parties to the 
mutual benefit of all organizations.
    One example of interagency collaboration occurred in 2009 when NNPP 
supported the Nuclear Regulatory Commission's (NRC) ``Report on 
Internal Safety Culture''. The exchange provided NRC with potential 
initiatives to increase awareness of and improve the agency's internal 
safety culture and to identify best practices currently used across the 
nuclear industry. Specifically, NRC benchmarked NNPP to gather 
information about practices, programs, and processes that could be 
considered as best practices. As part of this process, NNPP offered 
valuable insights and perspective from its extensive knowledge and 
experience in this crucial area. Similar collaboration with the Small 
Modular Reactor program may be possible.
    As the Small Modular Reactor program moves forward, NNPP and the 
Office of Nuclear Energy will continue to seek areas to cooperate to 
the mutual benefit of each organization and taxpayers, while protecting 
sensitive military technology.
                                 ______
                                 
             Question Submitted by Senator Mitch McConnell

                          URANIUM DOWNBLENDING

    Question. What is the most current estimate for the amount of down-
blended uranium that NNSA plans to down blend in 2012? Are future 
years' estimates similar in size? What percent of the 10 percent cap 
does that consume?
    Answer. In fiscal year 2012, NNSA's contractors will down blend 
approximately 8 metric tons of highly enriched uranium (HEU). Because a 
majority of the resulting low-enriched uranium (LEU) will be retained 
in two LEU inventories, only the fraction of the material that will be 
used to compensate the down-blending contractors will enter the market 
in fiscal year 2012. The estimated net quantity of LEU that will enter 
the market is equivalent to 281 metric tons of natural uranium, or 1.4 
percent of domestic demand for natural uranium (14 percent of the 10 
percent guideline). Quantities comparable to those above are expected 
to prevail for the next couple of years.

                          SUBCOMMITTEE RECESS

    Senator Feinstein. Thank you very much. Mr. D'Agostino, Ms. 
Harrington, Dr. Cook, and Admiral Donald, thank you very much 
for your testimony today. I will be talking with you, Mr. 
D'Agostino. Thank you very much.
    This hearing is recessed.
    Mr. D'Agostino. Thank you.
    Dr. Cook. Thank you very much.
    [Whereupon, at 3:35 p.m., Wednesday, May 4, the 
subcommittee was recessed, to reconvene subject to the call of 
the Chair.]


    ENERGY AND WATER DEVELOPMENT APPROPRIATIONS FOR FISCAL YEAR 2012

                              ----------                              


                        WEDNESDAY, MAY 18, 2011

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 2:41 p.m., in room SD-192, Dirksen 
Senate Office Building, Hon. Dianne Feinstein (chairman) 
presiding.
    Present: Senators Feinstein, Murray, Tim Johnson, Landrieu, 
Lautenberg, Alexander, Cochran, McConnell, Collins, Murkowski, 
and Graham.

                          DEPARTMENT OF ENERGY

                        Office of the Secretary

STATEMENT OF HON. STEVEN CHU, SECRETARY

             OPENING STATEMENT OF SENATOR DIANNE FEINSTEIN

    Senator Feinstein. Good afternoon, ladies and gentlemen, 
and welcome to the Energy and Water Subcommittee's budget 
hearing on the Department of Energy's (DOE) fiscal year 2012 
budget request.
    DOE has requested $30.5 billion for fiscal year 2012. That 
is an increase of $4.8 billion, or 19 percent, from fiscal year 
2011. About $1.1 billion of the $4.8 billion increase, or 25 
percent, is for the National Nuclear Security Administration's 
(NNSA) nuclear weapons for nonproliferation and Naval Reactor 
programs.
    This subcommittee has already explored NNSA's budget with 
Administrator D'Agostino 2 weeks ago. The rest of the increase 
is for energy efficiency and renewable energy projects, loan 
guarantees, and basic energy research.
    It is my understanding that DOE submitted this budget 
request before the Congress passed the 2011 continuing 
resolution, and so it does not reflect the new spending 
reality. So, it is clear that DOE and the Congress will have to 
make some joint, painful decisions and focus the limited 
resources that we have on the highest priorities. Therefore, I 
think knowing your highest priorities is of substantial 
importance to us, Secretary. I hope that you will highlight 
those. Do not feel shy.
    I would like to just highlight the three largest increases 
in this budget.
    The largest single increase would be for the Office of 
Energy Efficiency and Renewable Energy (EERE), which would see 
an increase of $1.4 billion or 76 percent. The only programs in 
this account that see a decrease are hydrogen and water power, 
and I know we want to discuss that.
    Given the across-the-board budget increases for all other 
programs, it is hard to determine which of these research and 
development (R&D) programs would have the biggest impact on 
energy use and the clean-energy economy.
    Second, the Office of Science would see an increase of $5.5 
million or 11 percent. So, those are the first two, EERE and 
Office of Science.
    Innovation clearly drives economic prosperity. The Office 
of Science has been one of the leaders in new scientific and 
technologies deliveries. For example, Argonne National Lab in 
Illinois spent 10 years researching cathode materials for a 
lithium ion battery that was small, energy efficient, and low 
in weight. General Motors used this technology to develop the 
battery it now uses in the Chevy Volt, the first mass produced 
plug in hybrid electric vehicle. So, that is significant.
    Despite these successes, the Office of Science must do a 
better job explaining how basic research can lead to new clean-
energy technologies, and how it can better leverage large 
scientific facilities to help American industry remain 
competitive. I mean, I would hazard a guess that that would be 
a substantial priority for all of us.
    Third, Advanced Research Projects Agency-Energy (ARPA-E) 
would see an increase of $370 million or 206 percent. ARPA-E, 
of course, holds a promise of advancing high-risk, high-reward 
technology.
    Even though ARPA-E is a new agency, I would like to ask 
that you apply ARPA-E program management to other DOE offices, 
such as the rigorous peer review process and contract or grant 
negotiations completed in just a few months. Streamlining 
contracting processes and assembling high-quality program 
management teams, I think, would benefit many DOE energy 
programs.
    My last observation is that outside of NNSA, DOE's budget 
does not provide a 5-year spending plan. Without this plan, it 
makes it difficult to buy into committing to programs that 
create large, out-year obligations.
    Joining us today is, of course, Dr. Steven Chu, the 
Secretary of Energy. In the full disclosure, I want to say that 
I have the greatest respect and fondness for Secretary Chu. I 
happened to meet him when he was head of Lawrence Berkley Labs, 
and his achievements are many, marked, and quite astounding. 
So, we all grant that you are a most brilliant secretary, 
Secretary Chu, and we are delighted to have you here.
    But let me turn to Senator Alexander for his remarks, if I 
might.

              OPENING STATEMENT OF SENATOR LAMAR ALEXANDER

    Senator Alexander. Thank you, Madam Chairman.
    When I was the Education Secretary and was in your shoes, I 
did not get that kind of compliment from the chairman of the 
subcommittee, so I am a little jealous.
    But, you know, I agree with her. I think, Dr. Chu, you are 
one of the President's best appointees, that you have been a 
terrific leader, and I am glad that you are spending this part 
of your life in this form of public service.
    I want to, in my remarks and then in the questions when my 
time comes, I want to focus on some of the things that Senator 
Feinstein talked about. And, for me, I would say it would be 
putting a priority on energy research for our country, 
something I know, Dr. Chu, you have long advocated.
    In 2008, I went to the Oak Ridge National Laboratory and 
gave a talk called ``A New Manhattan Project for Clean Energy 
Independence'', and suggested that we apply the same rigor and 
ambitious goals to energy research that we did to the Manhattan 
Project in World War II, and listed several objectives of such 
a new Manhattan Project, most of them taken from The 14 Grand 
Challenges of Engineering in the 21st Century that Chuck Vest 
and the National Academy of Engineering had said. But they 
included plug in electric cars, carbon capture, solar power and 
recycling, used nuclear fuel, advanced bio fuels, green 
buildings, and even fusion.
    Now, you were a part, Dr. Chu, of the National Academy's 
effort to say to the Congress what we should do to help our 
country be more competitive. We called it ``America Competes'' 
based upon your report. And you have moved to form hubs, you 
call them, in several areas, and in your request, you want to 
form more. So, I would like to indicate my broad agreement with 
that sort of strategy and work with you to find ways, even in 
this tight budget situation, to find--to prioritize spending 
and to find more money for clean-energy research.
    For example, my colleagues have wanted to talk this week 
about subsidies for energy for big oil. If we are going to do 
that, I think we should talk about all subsidies. I suggested 
on the floor this morning we might talk about big wind. The 
taxpayers are on the hook for $27 billion over the next 10 
years to subsidize windmills, which is more money than we would 
save if we cut out the tax breaks for the five big oil 
companies. That is just an example. And I am--that was based 
upon the production tax credit that was put into place 
temporarily in 1992.
    Now, my staff research indicates we only use about--spend 
about $6 billion on energy research in our Federal Government 
every year, and I would wonder whether some of these long-term 
subsidies for energy, whether big oil or big wind, might be 
better spent for energy research.
    There are other parts of the budget, even this budget, 
where I wonder whether the energy efficiency section, I wonder 
if energy efficiency money should go up at the level that it is 
mentioned here, or we should increase the research budget. 
There is $4 billion in unspent American Recovery and 
Reinvestment Act (ARRA) funding and weatherization and State 
energy grants. You're seeking $384 million more. Would that not 
be better spent to take the Federal research budget up closer 
to $7, $8, or $9 billion a year?
    I, too, like ARPA-E. I think that is a very promising area. 
We were only able to find $180 million for it this year, 
although it is authorized at $300 million, and it is now fully 
authorized.
    So, I would just--I would like to weigh in favor of energy 
research. I think many of my Republican colleagues see energy 
research as an appropriate role for the Federal Government. 
Long-term subsidies some of my Republican colleagues have 
problems with. I deal with long term. Short-term, I support 
jump starting electric cars, maybe natural gas trucks, jump 
starting the first new nuclear plants through loan guarantees. 
All these are things that you have suggested.
    But, so I will be looking to work with you on seeing if we 
can prioritize money from the current request, maybe look at 
these long-term subsidies, and apply more our dollars over the 
next 10 years to what you call hubs and I call a new Manhattan 
Project for clean-energy independence.
    Thank you, Madam Chairman.
    Senator Feinstein. And I thank you, Senator Alexander.
    We will proceed in 5-minute rounds and use the early bird 
rule straight as people come in to attend. And so, Secretary 
Chu, why do you not proceed with your remarks, and then we will 
go to questions.

                    SUMMARY STATEMENT OF STEVEN CHU

    Secretary Chu. Thank you, Chairman Feinstein, and thank 
you, Ranking Member Alexander, and the other members of the 
subcommittee, first, for your kind remarks, and--but also for 
giving me the opportunity to present and discuss the 
President's fiscal year 2012 budget request for DOE.
    President Obama has a plan for the United States to win the 
future by out-innovating, out-educating, and out-building the 
rest of the world, while at the same addressing the deficit. 
Many countries are moving aggressively to lead in clean energy. 
We must rev up the great American innovation machine to create 
jobs and win this clean-energy race.
    And to that end, President Obama has called for increased 
investments in clean-energy research, development, and 
deployment. In addition, he has proposed a bold, but 
achievable, goal of generating 80 percent of America's 
electricity from clean sources by 2035. DOE's fiscal year 2012 
budget request of $29.5 billion supports these goals and 
strengthens the Nation's economy and security.
    We recognize that families are feeling the effects of high 
gas prices right now, and while there are no silver bullets to 
this challenge, President Obama is committed to breaking our 
dependence on foreign oil and easing the burdens on families. 
This budget helps reduce our reliance on oil by developing the 
next generation of home grown bio fuels and by accelerating 
electric vehicle research, development, and deployment. And 
through energy efficiency programs, we will save money for 
consumers by saving energy.
    In addition, the budget supports the research, development, 
and deployment of renewable energy, the modernization of the 
electric grid, and advancement of carbon capture and 
sequestration technologies. The budget also supports loan 
guarantees for renewable and energy efficiency technologies. 
Nuclear energy has an important role to play in our energy 
portfolio, and that is why the budget requests additional loan 
guarantee authority and invests in the research and development 
of advanced nuclear technologies.
    To unleash innovation, the President's budget supports the 
groundbreaking research through DOE's Office of Science. For 
example, we are investing in basic energy sciences, advanced 
scientific computing, biological and environmental science, and 
all key areas for economic competitiveness. In addition, the 
Office of Science supports widely used facilities that provide 
unique analysis tools for materials, chemistry, and biology 
research.
    The budget invests $515 million in ARPA-E, and this will 
allow ARPA-E to continue to support research projects that aim 
to deliver game-changing clean-energy technologies. ARPA-E's 
projects are generating excitement in the private sector.
    For example, through a combined total of $24 million from 
ARPA-E, six companies have already been able to advance their 
research efforts and show the potential viability of their 
cutting-edge technologies. This early support enabled those 
companies to achieve R&D milestones that, in turn, have 
attracted more than $100 million in private sector funds to the 
projects. This is precisely the innovation leverage that is 
needed to win the future.
    Another key piece of our research effort is the energy 
innovation hubs. Through the hubs, we are bringing together top 
scientists and engineers to achieve similar game-changing 
energy goals, but where a concentrated effort over a longer 
time horizon is needed to establish innovation leadership. The 
budget requests $146 million to support the three existing hubs 
and to establish three new hubs in the areas of batteries and 
energy storage, smart grid technologies and systems, and 
critical materials.
    Finally, the budget supports the Energy Frontier Research 
Centers (EFRC), which are working to solve specific scientific 
problems that are blocking clean-energy development. To better 
integrate and maximize our research efforts, DOE is organizing 
along the lines of business. This will help us create a sum 
that is worth more than the parts.
    In any specific technological area, we are examining 
current business projections and looking across ARPA-E, the 
Office of Science, and our applied technology side to determine 
where we in DOE can add the most value to accelerate the pace 
of innovation.
    For example, we have instituted a SunShot Initiative with 
participation from ARPA-E, Office of Science, and EERE to make 
the solar energy cost competitive with any other form of energy 
before the end of this decade. And this would position the 
United States to lead in this growing industry.
    At a time when industry, the Congress, and the American 
people are making critical energy decisions, we need to make 
sure to adequately fund the Energy Information Administration 
(EIA), the Nation's premier source of independent statistical 
information about energy production and use. Even a modest 
increase to support the EIA will go a long way in providing the 
Congress and others with an unbiased data and analysis needed 
to make informed decisions.
    In addition to strengthening our economy, the budget also 
strengthens our security by providing $11.8 billion for DOE's 
NNSA. The request of $7.6 billion for weapons activities 
provides a strong basis for transitioning to a smaller, yet 
still safe, secure, and effective nuclear stockpile without 
additional nuclear testing.
    It also provides much needed resources to strengthen 
science, technology, and engineering capabilities, and to 
modernize the physical infrastructure of our nuclear security 
enterprise.
    To support the President's goal of securing all vulnerable 
nuclear material around the world in 4 years, the budget 
invests $2.5 billion in the Defense Nuclear Nonproliferation 
program. Through our investments, the Obama administration is 
laying the groundwork for the Nation's future prosperity and 
security. At the same time, we are mindful of our 
responsibility to the taxpayer. We are streamlining operations 
and cutting back in multiple areas, including eliminating 
unnecessary fossil fuel subsidies.

                           PREPARED STATEMENT

    The United States faces a choice: Will we lead in 
innovation or will we fall behind? To lead the world in clean 
energy, we must act now, and we cannot afford not to.
    Thank you and I am pleased to now answer your questions.
    [The statement follows:]

                    Prepared Statement of Steven Chu

    Chairman Feinstein, Ranking Member Alexander, and members of the 
subcommittee, thank you for the opportunity to appear before you today 
to discuss the President's fiscal year 2012 budget request for the 
Department of Energy (DOE).
    In his State of the Union Address, President Obama laid out a plan 
for the United States to win the future by out-innovating, out-
educating, and out-building the rest of the world, while at the same 
time addressing the deficit. The President's budget request invests in 
much-needed programs while cutting back where we can afford to.
    Many countries are moving aggressively to develop and deploy the 
clean-energy technologies that the world will demand in the coming 
years and decades. As the President said, this is our generation's 
``Sputnik moment''.
    We must rev up the great American innovation machine to win the 
clean-energy race and secure our future prosperity. To that end, 
President Obama has called for increased investments in clean-energy 
research, development, and deployment. In addition, he has proposed a 
bold, but achievable goal of generating 80 percent of America's 
electricity from clean sources by 2035.
    A clean-energy standard will provide a clear, long-term signal to 
industry to bring capital off the sidelines and into the clean-energy 
sector. It will grow the domestic market for clean sources of energy--
creating jobs, driving innovation, and enhancing national security. And 
by drawing on a wide range of energy sources including renewables, 
nuclear, clean coal and natural gas, it will give utilities the 
flexibility they need to meet our clean-energy goal while protecting 
consumers in every region of the country.
    DOE's fiscal year 2012 budget request of $29.5 billion supports 
these goals and strengthens the Nation's economy and security by 
investing in the following priorities:
  --Supporting groundbreaking basic science, research, and innovation 
        to solve our energy challenges and ensure that the United 
        States remains at the forefront of science and technology;
  --Leading in the development and deployment of clean and efficient 
        energy technologies to reduce our dependence on oil, accelerate 
        the transition to a clean-energy economy, and promote economic 
        competitiveness; and
  --Strengthening national security by reducing nuclear dangers, 
        maintaining a safe, secure and effective nuclear deterrent, and 
        cleaning up our cold war nuclear legacy.
    While we are investing in areas that are critical to our future, we 
are also rooting out programs that aren't needed and making hard 
choices to tighten our belt. Additionally, we are improving our 
management and operations so we function more efficiently and 
effectively.

               LEADING IN THE GLOBAL CLEAN-ENERGY ECONOMY

    As the President said in his State of the Union Address, investing 
in clean-energy will strengthen our security, protect our planet, and 
create countless new jobs here at home. DOE's budget request invests 
$3.2 billion in energy efficiency and renewable energy programs.
    Through programs to make homes and buildings more energy efficient, 
including a new ``Better Buildings Initiative'' to make commercial 
buildings 20 percent more efficient over the next decade, we will save 
money for families and businesses by saving energy. That is money that 
can be re-invested back into the economy. In addition, the budget 
supports the research, development, and deployment (RD&D) of renewable 
sources of energy like wind, solar, and geothermal. It supports the 
modernization of the electric grid and the advancement of carbon 
capture and sequestration technologies. And it helps reduce our 
dependence on oil by developing the next generation of biofuels and 
accelerating electric vehicle research and deployment to support the 
President's goal of putting 1 million electric vehicles on the road by 
2015. This includes a $200 million competitive program to encourage 
communities to invest in electric vehicle infrastructure.
    We're also focused on moving clean-energy technologies from the lab 
to the marketplace. Over the past 2 years, DOE's loan programs have 
supported more than $30 billion in loans, loan guarantees, and 
conditional commitments to guarantee loans for 28 clean-energy and 
enhanced automotive fuel efficiency projects across the country, which 
the companies estimate will create or save more than 61,000 jobs. 
Building on this success, we are requesting new credit subsidy that 
will support approximately $1 to $2 billion in loan guarantees for 
innovative renewable energy and energy efficiency technologies. These 
deployment efforts build on the substantial investment made in the 
clean-energy sector by the American Recovery and Reinvestment Act 
(ARRA), and are supplemented by tax incentives that have also played an 
important role in bringing clean-energy projects to market, such as the 
48C manufacturing tax credits and the 1603 cash grants in lieu of 
investment tax credits, which the 2012 budget also expands. We are also 
requesting $100 million in credit subsidy for a new ``Better Buildings 
Pilot Loan Guarantee Initiative for Universities, Schools, and 
Hospitals'', which will guarantee up to $2 billion in loans to support 
energy efficient retrofits.
    Nuclear energy also has an important role to play in our energy 
portfolio. To jumpstart the domestic nuclear industry, the budget 
requests up to $36 billion in loan guarantee authority. It also invests 
in the research and development (R&D) of advanced nuclear technologies, 
including small modular reactors (SMR).

                   SUPPORTING GROUNDBREAKING SCIENCE

    To spur innovation, the President's budget request invests in basic 
and applied research and keeps us on the path to doubling funding for 
key science agencies, including DOE's Office of Science. As Norm 
Augustine, former chairman of Lockheed Martin and former Under 
Secretary of the Army, has said, underfunding R&D in a time of 
austerity is like removing the engine of an aircraft to reduce its 
weight.
    That is why the budget request increases support for DOE's 
comprehensive research strategy to accelerate energy breakthroughs.
    Through $5.4 billion for the Office of Science, we're expanding our 
investment in basic energy sciences, advanced scientific computing, and 
biological and environmental sciences--all key areas for our future 
economic competitiveness.
    The budget invests $550 million in the Advanced Research Projects 
Agency-Energy, (ARPA-E). The administration also seeks an additional 
$100 million for ARPA-E from the Wireless Innovation Fund to support 
wireless clean-energy technologies. This investment will allow ARPA-E 
to continue the promising early stage research projects that aim to 
deliver game-changing clean-energy technologies. ARPA-E's projects are 
generating excitement both in DOE and in the private sector. For 
example, through a combined total of $24 million from ARPA-E, six 
companies have been able to advance their research efforts and show the 
potential viability of their cutting-edge technologies. This extremely 
valuable early support enabled those companies to achieve R&D 
milestones that, in turn, have attracted more than $100 million in 
private sector funds to the projects. This is precisely the innovation 
leverage that is needed to win the future.
    Another key piece of our research effort is the Energy Innovation 
Hubs. Through the Hubs, we are bringing together our Nation's top 
scientists and engineers to achieve similar game-changing energy goals, 
but where a concentrated effort over a longer time horizon is needed to 
establish innovation leadership. DOE has established three Energy 
Innovation Hubs in the areas of energy efficient buildings, modeling, 
and simulation for nuclear reactors, and fuels from sunlight. The 
budget requests $146 million to support the three existing Hubs and to 
establish three new Hubs in the areas of batteries and energy storage, 
smart grid technologies and systems, and critical materials. The Energy 
Innovation Hubs were modeled after DOE's BioEnergy Institutes, which 
have established an outstanding 3-year track record.
    Finally, the budget continues to support the Energy Frontier 
Research Centers (EFRCs), which are mostly university-led teams working 
to solve specific scientific problems that are blocking clean-energy 
development.
    The Energy Innovation Hubs, ARPA-E, and EFRCs represent three 
complementary approaches to advance groundbreaking discovery. When you 
think of the EFRCs, think about a collaborative team of scientists such 
as Watson and Crick unlocking the secrets of DNA. When you think of 
ARPA-E, think about visionary risk-takers launching new technologies 
and start-up companies out of their garages. When you think of the 
Hubs, think of large, mission-oriented research efforts such as the 
Manhattan Project, the development of radar at MIT's Radiation 
Laboratory during World War II and the research in America's great 
industrial laboratories in their heyday.
    We don't know where the big energy breakthroughs are going to come 
from. To reach our energy goals, we must take a portfolio approach to 
R&D: pursuing several research strategies that have proven to be 
successful in the past. But I want to be clear--this is not a ``kitchen 
sink'' approach. This work is being coordinated and prioritized, with a 
360-degree view of how these pieces fit together. Taken together, these 
initiatives will help America lead in science and technology 
innovation.

                      NUCLEAR SAFETY AND SECURITY

    In addition to strengthening our economy, the budget request also 
strengthens our security by providing $11.8 billion for DOE's National 
Nuclear Security Administration (NNSA). The 5-year fiscal year 2012 to 
fiscal year 2016 request of nearly $65 billion for NNSA reflects the 
President's nuclear security priorities, as well as his commitment to 
modernize the U.S. nuclear weapons enterprise and sustain a strong 
nuclear deterrent for the duration of the New Strategic Arms Reduction 
Treaty (New START) and beyond.
    The request of $7.6 billion for weapons activities provides a 
strong basis for transitioning to a smaller yet still safe, secure and 
effective nuclear stockpile without additional nuclear testing. It also 
provides much-needed resources to strengthen science, technology, and 
engineering capabilities and to modernize the physical infrastructure 
of our nuclear security enterprise.
    The President has identified the danger of terrorists getting their 
hands on nuclear weapons or the material to build them as the greatest 
threat to global security. To support the President's goal of securing 
all vulnerable nuclear material around the world in 4 years, the budget 
invests $2.5 billion in the NNSA Defense Nuclear Nonproliferation 
program. This is part of a 5-year, $14.2 billion commitment for the 
program.
    The budget also requests $1.2 billion to support the Navy's nuclear 
powered submarines and aircraft carriers. And it provides $6.1 billion 
to protect public health and safety by cleaning up the Nation's cold 
war nuclear legacy.

                         FISCAL RESPONSIBILITY

    Through our investments, we are laying the groundwork for the 
Nation's future prosperity and security. At the same time, we are 
mindful of our responsibility to the taxpayer.
    We are cutting back in multiple areas, including eliminating 
unnecessary fossil fuel subsidies, reducing funding for the fossil 
energy program and reducing funding for the hydrogen technology 
program. We're streamlining operations to reduce administrative costs. 
And we're making some painful cuts, including ending operation of the 
Tevatron accelerator and freezing salaries and bonuses for hard-working 
National Laboratory, site and facility management contractor employees.
    Finally, we continue to make progress on a management excellence 
agenda to improve our operations.

           HIGHLIGHTS OF THE FISCAL YEAR 2012 BUDGET REQUEST

    In his State of the Union Address, President Obama said that 
America faces ``our generation's Sputnik moment'' and that we need to 
out-innovate, out-educate, and out-build the rest of the world to 
capture the jobs of the 21st century. ``In America, innovation doesn't 
just change our lives. It's how we make our living.'' Through 
innovation in promising areas like clean energy, the United States will 
win the future and create new industries and new jobs. To lead in the 
global clean-energy economy, we must mobilize America's innovation 
machine in order to bring technologies from the laboratory to the 
marketplace. DOE is on the front lines of this effort. To succeed, DOE 
will pursue game-changing breakthroughs, invest in innovative 
technologies, and demonstrate commercially viable solutions.
    In addition to energy advances that spark economic growth, national 
security remains fundamental to the Department's mission. Through 
bipartisan ratification of the New START treaty with Russia, America, 
and its global partners are leading by example in implementing the 
focused expansion of domestic and international activities to reduce 
the threat of nuclear weapons, nuclear proliferation, and unsecured or 
excess weapons-usable materials. The NNSA supports the international 
effort to secure all vulnerable nuclear materials around the world 
within 4 years. The NNSA also fulfills the President's commitment to 
modernize the Nation's nuclear stockpile until a world without nuclear 
weapons can be realized.
    DOE's fiscal year 2012 budget request is $29.5 billion, an 11.8 
percent or $3.1 billion increase from fiscal year 2010 current 
appropriation levels. The fiscal year 2012 request supports the 
President's goals to increase America's competitiveness by making 
strategic investments in our Nation's clean-energy infrastructure and 
to strengthen our national security by reducing the global threat of 
nuclear materials. The President has called for advancing research on 
clean-energy technologies and manufacturing, doubling the share of 
electricity generated from clean-energy supplies by 2035, and putting 1 
million electric vehicles on the road by 2015. DOE's request prepares 
for a multi-year effort to address these interconnected objectives and 
prioritizes R&D of renewable energy technologies to expand sustainable 
energy options for the United States.
    The fiscal year 2012 budget builds on the intense planning, 
execution, and oversight of the $35.2 billion from ARRA. By the end of 
fiscal year 2010, DOE successfully obligated $32.7 billion of ARRA 
funds, including all funding that was set to expire. In developing the 
fiscal year 2012 budget request, the DOD has taken these investments 
into account and will oversee execution of these funds with value to 
the taxpayer in mind. ARRA investments are focused on:
  --energy conservation and renewable energy sources ($16.8 billion);
  --environmental cleanup ($6 billion);
  --loan guarantees for renewable energy and electric power 
        transmission projects ($2.4 billion);
  --grid modernization ($4.5 billion);
  --carbon capture and sequestration ($3.4 billion);
  --basic science research ($1.6 billion); and
  --the ARPA-E ($0.4 billion).
    DOE's ARRA activities are strengthening the economy by providing 
much-needed investment, saving or creating tens of thousands of jobs, 
cutting carbon pollution, and reducing U.S. dependence on oil.
    The President's fiscal year 2012 budget supports three strategic 
priorities:
      Transformational Energy.--Accelerate the transformation to a 
        clean-energy economy and secure U.S. leadership in clean-energy 
        technologies.
      Economic Prosperity.--Strengthen U.S. science and engineering 
        efforts to serve as a cornerstone of our economic prosperity 
        and lead through energy efficiency and secure forms of energy.
      Nuclear Security.--Enhance nuclear security through defense, 
        nonproliferation, naval reactors, and environmental clean-up 
        efforts.
    As the President has articulated, innovation is essential to 
America's economic competitiveness. To meet the challenge of ``our 
generation's Sputnik moment'', DOE supports a coordinated strategy for 
research and development across all of its programs. With every 
initiative DOE undertakes, sound science is at the core. In fiscal year 
2012, we will increasingly emphasize cross-cutting initiatives to link 
science throughout DOE, specifically with energy and national security 
programs in order to deliver results to the American taxpayer. In the 
Office of Science, the Department requests $5.4 billion, a 9.1 percent 
or $452 million increase more than the fiscal year 2010 current 
appropriation levels, to support an elevated focus on the advancement 
of the United States' leadership in fundamental research. ARPA-E is 
building on established gains since its initial funding in fiscal year 
2009 through the ARRA to perform transformational research and create 
game-changing breakthroughs for eventual market adoption. The fiscal 
year 2012 budget request includes $550 million for ARPA-E to sustain 
investment in new energy technologies.
    Energy Innovation Hubs play a key role in solving specific energy 
challenges by convening and focusing top scientific and engineering 
talent to focus on those problems. The Hubs bring together 
multidisciplinary teams of researchers in an effort to speed research 
and shorten the path from scientific discovery to technological 
development and commercial deployment of highly promising energy-
related technologies. DOE is proposing to double its commitment to this 
research approach by requesting three new Hubs to focus on batteries 
and energy storage, critical materials, and Smart Grid technologies and 
systems. DOE will continue funding the three Energy Innovation Hubs 
introduced in fiscal year 2010 to focus on developing fuels that can be 
produced directly from sunlight, improving energy efficient building 
systems design, and using modeling and simulation tools to create a 
virtual model of an operating advanced nuclear reactor. Complementing 
the Hubs, DOE plans in fiscal year 2012 to continue coordination with 
the Office of Science's EFRCs, which exemplify the pursuits of broad-
based science challenges for energy applications.
Energy Security--Promoting America's Energy Security Through Reliable, 
        Clean, and Affordable Energy
    In his State of the Union Address, the President outlined clearly 
to the American people his roadmap for transforming our Nation's energy 
economy to meet the demands of future generations. ``Instead of 
subsidizing yesterday's energy, let's invest in tomorrow's'', he said. 
To meet the President's challenge, DOE must recruit the sharpest 
research minds and build on its aggressive discovery agenda across all 
programs to achieve breakthroughs on the most-pressing energy 
challenges facing the United States.
    In his address, President Obama laid out a goal for clean-energy 
sources to account for 80 percent of America's electricity by 2035. In 
fiscal year 2012, DOE requests funds to help achieve this Presidential 
objective and address many of the energy delivery challenges facing 
American families and energy providers.
    Applied Research, Development, and Deployment.--Meeting the 
President's goal of making America the first country to have 1 million 
electric vehicles on the road by 2015, DOE will research cost-
competitive methods to develop electric vehicles, increase the 
adaptability and capacity of the grid to enable vehicle charging, 
incentivize communities to invest in electric vehicles and 
infrastructure and send these vehicles to the Nation's roadways. DOE 
will also launch competitive manufacturing research for breakthrough 
technologies in energy efficiency diagnostics and retrofits to help 
business owners around the country save money on energy costs.
    Loan Guarantees.--The Loan Programs Office (LPO) is a vital tool 
for promoting innovation in the energy sector across a broad portfolio 
of clean and efficient energy technologies. In fiscal year 2012, DOE is 
requesting credit subsidies to support approximately $1 to $2 billion 
in loan guarantees for renewable energy deployment and up to $36 
billion in additional authority to loan guarantees for nuclear power 
projects. DOE will also continue to streamline and prioritize the 
issuance of loan guarantees to leverage private sector investment in 
clean-energy and energy efficiency projects that will save and create 
jobs.
    Better Buildings Initiative.--Last year, commercial buildings 
consumed roughly 20 percent of all energy in the U.S. economy. 
Improving energy efficiency in our buildings can create jobs, save 
money, reduce our dependence on oil, and make our air cleaner. The 
President's Better Buildings Initiative will make commercial buildings 
20 percent more energy efficient over the next decade through 
initiatives that include:
  --re-designing the current tax deduction for commercial buildings and 
        upgrades to a credit that is more generous and that will 
        encourage building owners and real estate investment trusts 
        (REITs) to retrofit their properties;
  --improving financing opportunities for retrofits through programs 
        including a new Better Buildings Pilot Loan Guarantee 
        Initiative for Universities, Schools and Hospitals, for which 
        DOE requests $100 million in credit subsidy to guarantee up to 
        $2 billion in loans for energy efficiency retrofits for these 
        facilities;
  --creating a $100 million Race to Green competitive grant program for 
        State and municipal governments to implement innovative 
        approaches to building codes, performance standards, and 
        regulations so that commercial building efficiency will become 
        the norm in communities across the country; and
  --calling on CEOs and university presidents to join DOE and other 
        Federal partners in a Better Buildings Challenge to make their 
        organizations leaders in saving energy.
    The Better Buildings Initiative builds on our investments through 
ARRA and our continued commitment to passing ``HOMESTAR'' legislation 
to encourage American families to make energy saving upgrades in their 
homes.
    Electricity Reliability and Energy Management.--Reliable, 
affordable, efficient, and secure electric power is vital to expanding 
economic recovery, protecting critical infrastructures, and enabling 
the transition to renewable energy sources. The fiscal year 2012 
request invests $238 million to bring the next generation of grid 
modernization technologies closer to deployment and commercialization, 
to assist States and regional partners in grid modernization efforts, 
and to facilitate recovery from energy supply disruptions when they 
occur. The request includes a new Smart Grid Technology and Systems Hub 
that will address the total electricity system, covering applied 
science, technology, economic, and policy issues that affect our 
ability to modernize the grid. The fiscal year 2012 request also plans 
an expansion of the Home Energy Score program that provides homeowners 
with information on how their homes can be more energy efficient and 
guidance for saving on home energy costs. This is in addition to the 
President's support for passage of the HOMESTAR rebate program in 2011.
    Investing in energy efficiency, renewable energy generation, and 
grid modernization are fundamental steps necessary for creating a 
clean-energy economy. We must also invest in the improvement of 
existing sources of energy that will provide a bridge between current 
and future technologies. These technologies are already a major segment 
of the energy mix and will play a critical role in providing a solid 
foundation that will make possible the creation of a new energy 
economy.
    Leadership in Nuclear Energy.--Nuclear energy currently supplies 
approximately 20 percent of the Nation's electricity and 70 percent of 
the Nation's clean, noncarbon electricity. The request for the Office 
of Nuclear Energy includes $380 million for R&D, in addition to key 
investments in supportive infrastructure. In addition, DOE is engaging 
in cost-shared activities with industry that may help accelerate 
commercial deployment of SMRs. The request includes funding for cost-
shared design certification and licensing activities for SMRs, the 
deployment of which holds promise for vastly increasing the generation 
of clean energy on a cost competitive basis. DOE will also promote 
nuclear power through the Loan Guarantee program, which is requesting 
up to $36 billion in additional loan guarantee authority in fiscal year 
2012.
    Advanced Fossil Energy--Experience in Carbon Capture and Storage.--
The world will continue to rely on coal-fired electrical generation to 
meet energy demand. It is imperative that the United States develop the 
technology to ensure that base-load electricity generation is as clean 
and reliable as possible. The Office of Fossil Energy requests $452.9 
million for R&D of advanced coal-fueled power systems and carbon 
capture and storage technologies. The budget focuses resources within 
the fossil energy program on activities that can reduce carbon 
pollution and have potential benefits for both the existing fleet and 
new power plants--specifically, postcombustion capture R&D and geologic 
carbon storage R&D.
    Ending Tax Subsidies to Fossil Fuel Producers.--In accordance with 
the President's agreement at the G-20 Summit in Pittsburgh to phase out 
subsidies for fossil fuels so that we can transition to a 21st century 
energy economy, the administration proposes to repeal a number of tax 
preferences available for fossil fuels. Tax subsidies proposed for 
repeal include, but are not limited to:
  --the credit for oil and gas produced from marginal wells;
  --the deduction for costs paid or incurred for any tertiary injectant 
        used as part of a tertiary oil recovery method; the ability to 
        claim the domestic manufacturing deduction against income 
        derived from the production of oil and gas and coal; and
  --expensing the exploration and development costs for coal.
    Improving Energy Information.--Because of the central connection 
between energy and the U.S. economy, the Nation's leaders, energy 
markets, producers, manufacturers and consumers need reliable, timely, 
impartial, and transparent information, and analyses. Such information 
enhances the debate over energy utilization strategies, the development 
of alternative energy sources, and investment decisions, and is 
essential during times of energy ``shocks''. The EIA requests $124 
million to update its energy data collection and analysis programs to 
reflect the current industry composition and operation in order to 
continue to provide a comprehensive picture of energy markets and 
industry as a whole. The request places a special emphasis on providing 
better data on energy consumption in homes, commercial buildings, and 
manufacturing establishments to enable EIA to maintain the high-quality 
of the information needed to inform decisions by the private sector, by 
Government policymakers, and by households.
Economic Security--Sharpening America's Competitive Edge Through a 
        Clean-Energy Economy
    To meet ``our generation's Sputnik moment'' and promote economic 
competitiveness, the United States must demonstrate leadership in 
clean-energy technologies. ``We'll invest in biomedical research, 
information technology and especially clean-energy technology--an 
investment that will strengthen our security, protect our planet, and 
create countless new jobs for our people'', said President Obama before 
the Congress in the State of the Union Address. President Obama 
outlined his comprehensive vision to lead our Nation's clean-energy 
economy and provide economic security to Americans. As the 
administration seeks to reduce Federal Government spending, DOE 
recognizes its role and has tightened its expenditures in several areas 
such as oil and natural gas. The fiscal year 2012 budget request 
acknowledges DOE's missions to achieve these imperative goals while 
setting forth a clean-energy economy for entrepreneurs and 
manufacturers to reclaim their competitive edge in clean-energy 
innovation.
    DOE plans to promote economic security by building on the progress 
made through the more than $32 billion in grants and contracts under 
ARRA, which made historic investments in the Nation's economy and has 
put the country on target to double renewable energy generation by 
2012. ARRA helped create tens of thousands of jobs and, combined with 
the fiscal year 2012 request, will help DOE accelerate the transition 
of our Nation to a clean-energy economy.
    The President's fiscal year 2012 budget supports the plan to 
rebuild our economy through clean-energy research and development by:
      Expanding ARPA-E To Spur Innovation.--The President's request 
        proposes $550 million for the ARPA-E program, plus an 
        additional $100 million for the program from the Wireless 
        Innovation and Infrastructure initiative for a total of $650 
        million. ARPA-E performs transformational and cutting-edge 
        energy research with real-world applications in areas ranging 
        from grid technology and power electronics to batteries and 
        energy storage. The budget also supports programs with 
        significant promise to provide reliable, sustainable energy 
        across the country, such as the SunShot initiative aimed at 
        making solar energy cost competitive. With focused investment 
        in manufacturing innovation and industrial technical 
        efficiencies, the President's proposal will move private sector 
        capital off the shelves and into the marketplace.
      Targeting Investments for Future Economic Growth.--To secure a 
        competitive advantage in high-tech industries and maintain 
        international leadership in scientific computing, we will 
        invest in core research activities for energy technologies, the 
        development of general biological design principles and new 
        synthetic molecular toolkits to improve understanding of 
        natural systems, and core research activities to advance the 
        frontiers of high-performance computing. Underlying these 
        investments in research is the education and training of 
        thousands of scientists and engineers who contribute to the 
        skilled scientific workforce needed for a 21st century 
        innovation economy.
      Doubling the Number of Energy Innovation Hubs To Solve Key 
        Challenges.--Innovation breakthroughs occur when scientists 
        collaborate on focused problems. The fiscal year 2012 budget 
        request proposes three new Energy Innovation Hubs that will 
        bring top American scientists to work in teams on critical 
        energy challenges in areas such as critical materials, 
        batteries and energy storage, and Smart Grid technologies. 
        These will join three existing Hubs that focus on fuel 
        generation from sunlight, building efficiency, and nuclear 
        reactor modeling and simulation.
      Integrating Research and Development.--DOE has identified areas 
        where coordinated work by discovery-oriented science and 
        applied energy technology programs hold the greatest promise 
        for progress in achieving our energy goals. The Energy Systems 
        Simulation to increase the efficiency of the Internal 
        Combustion Engine (ICE) will produce a set of modern, validated 
        computer codes that could be used by design engineers to 
        optimize the next generation of cleaner, more efficient 
        combustion engines. An initiative on extreme environments will 
        close the gap between actual and ideal performance of materials 
        in nuclear environments. And DOE's Exascale Computing 
        initiative will allow DOE to take the lead in developing the 
        next generation of scientific tools and to advance scientific 
        discoveries in solving practical problems.
      Pursuing the Passage of HOMESTAR.--Enactment of this program will 
        create jobs by providing strong short-term incentives for 
        energy efficiency improvements in residential buildings. The 
        HOMESTAR program has the potential to accelerate our economic 
        recovery by boosting demand for energy efficiency products and 
        installation services. The program will provide rebates of 
        $1,000 to $3,000 per household to encourage immediate 
        investment in energy-efficient appliances, building mechanical 
        systems and insulation, and whole-home energy efficiency 
        retrofits. This program will help middle-class families save 
        hundreds of dollars a year in energy costs while improving the 
        comfort and value of their most important investment--their 
        homes. In addition, the program would help reduce our economy's 
        dependence on fossil fuels and support the development of an 
        energy efficiency services sector in our economy.
      Extending Access to Tax Credit and Tax Grant Programs.--Two 
        provisions of ARRA have been extraordinarily successful in 
        spurring the deployment of renewable energy projects and 
        building advanced manufacturing capabilities:
        --section 48C Advanced Energy Manufacturing Tax Credit program; 
        and
        --the section 1603 Energy Cash Assistance program.
      The administration is pursuing an additional $5 billion in 
        support for the section 48C program, which, by providing a 30 
        percent tax credit for energy manufacturing facilities, will 
        continue to help build a robust high-technology, U.S. 
        manufacturing capacity to supply clean-energy projects with 
        U.S.-made parts and equipment. The section 1603 tax grant 
        program has created tens of thousands of jobs in industries 
        such as wind and solar by providing upfront incentives to 
        thousands of projects. The administration is seeking a 1-year 
        extension of this program.
      Promoting Efficient Energy Use in Our Everyday Lives.--Currently, 
        weatherization of more than 300,000 homes of low-income 
        families has been achieved, providing energy cost savings and 
        financial relief to households. The fiscal year 2012 request of 
        $320 million continues residential weatherization, while 
        increasing the focus on new innovative approaches to 
        residential home weatherization.
National Security--Securing Nuclear and Radiological Materials, 
        Maintaining Nuclear Deterrence, and Advancing Responsible 
        Legacy Cleanup
    A pillar of President Obama's national security agenda for the 
United States is to eliminate the global threat posed by nuclear 
weapons and prevent weapons-usable nuclear material from falling into 
the hands of terrorists. As part of this agenda, the administration and 
the Congress worked tirelessly toward the December 2010 bipartisan 
ratification of New START with Russia, which cuts the number of 
strategic nuclear weapons each country can deploy to 1,550. After 
signing this agreement in April 2010, President Obama said, ``In many 
ways, nuclear weapons represent both the darkest days of the cold war, 
and the most troubling threats of our time. Today, we've taken another 
step forward . . . in leaving behind the legacy of the 20th century 
while building a more secure future for our children. We've turned 
words into action. We've made progress that is clear and concrete. And 
we've demonstrated the importance of American leadership--and American 
partnership--on behalf of our own security, and the world's.''
    DOE's NNSA, through work with global partners and efforts to secure 
vulnerable nuclear materials, achieved significant milestones during 
fiscal year 2010 and fiscal year 2011 to reduce the risk of 
proliferation and leverage science to maintain our Nation's nuclear 
deterrence. Additionally, the environmental management program made 
progress advancing responsible nuclear cleanup from the cold war. DOE's 
fiscal year 2012 request seeks to build upon these successes and 
advance the President's nuclear security agenda.
            Reduce the Risk of Proliferation
    In 2009, President Obama committed the United States to an 
international effort to secure vulnerable nuclear material worldwide in 
4 years. To solidify international support for this effort, and to 
address the threat of nuclear terrorism, the President convened leaders 
from 47 countries at the Washington nuclear security summit in April 
2010. The summit resulted in a communique which stated, ``Nuclear 
terrorism is one of the most challenging threats to international 
security, and strong nuclear security measures are the most effective 
means to prevent terrorists, criminals, or other unauthorized actors 
from acquiring nuclear materials.''
    The fiscal year 2012 budget for the NNSA Defense Nuclear 
Nonproliferation program will help advance further work that is needed 
to meet the goals of President Obama and the nuclear security summit, 
recognizing the urgency of the threat and making the full commitment to 
global cooperation on nonproliferation. The budget provides $2.5 
billion in fiscal year 2012, and $14.2 billion through fiscal year 2016 
to detect, secure, and dispose of dangerous nuclear and radiological 
material worldwide. This request is a decrease of 5 percent, or $138 
million, from the fiscal year 2011 request, which reflects completion 
of accelerated efforts to secure vulnerable nuclear materials within 
the President's stated timeframe. The decrease also reflects our 
decision to await agreement between the United States and Russia on 
detailed implementation milestones prior to requesting additional U.S. 
pledged funding to support Russian plutonium disposition. The fiscal 
year 2012 budget request follows through on securing vulnerable 
materials and supports efforts to design new technologies in support of 
treaty monitoring and verification, which will contribute to 
implementation of New START. The budget also broadens cooperative 
nonproliferation initiatives with foreign governments and international 
organizations in support of the President's objective of a world 
without nuclear weapons. The budget continues the provision of security 
upgrades at selected sites, both within the United States and in 
foreign countries, to address outsider and insider threats, and 
accelerates the pace of research reactor conversions from use of highly 
enriched uranium fuel to low-enriched uranium fuel.
            Leverage Science To Maintain Nuclear Deterrence
    The fiscal year 2012 budget request advances DOE's commitment to 
the national security interests of the United States through 
stewardship of a safe, secure and effective nuclear weapons stockpile 
without the use of underground nuclear testing. The 2010 Nuclear 
Posture Review Report calls for the United States to reduce nuclear 
force levels. As the United States begins the reduction required by New 
START, the science, technology, and engineering capabilities and 
intellectual capacity within the nuclear security enterprise become 
more critical to sustaining the U.S. nuclear deterrent. NNSA continues 
to emphasize these capabilities, including functioning as a national 
science, technology, and engineering resource to other agencies with 
national security responsibilities. Through the NNSA, DOE requests $7.6 
billion for the weapons activities appropriation, an 8.9 percent, or 
$621 million, increase from the President's fiscal year 2011 request. 
It also is an 18.9 percent, or $1.205 million increase from the fiscal 
year 2010 enacted appropriation. This increase reflects an investment 
strategy that provides a strong basis for transitioning to a smaller 
yet still safe, secure, and effective nuclear stockpile without 
additional nuclear testing, strengthening the science, technology and 
engineering base, modernizing the physical infrastructure, and 
streamlining the enterprise's physical and operational footprint. These 
investments will further enable the Nuclear Posture Review's 
comprehensive nuclear defense strategy, based on current and projected 
global threats that rely less on nuclear weapons, while strengthening 
the Nation's nuclear deterrent through completing major stockpile 
system life extensions, stabilizing the science, technology and 
engineering base, and modernizing the infrastructure.
    The Naval Reactors program ensures the safe and reliable operation 
of reactor plants in nuclear-powered submarines and aircraft carriers, 
constituting 45 percent of the U.S. Navy's combatants. The fiscal year 
2012 request for Naval Reactors of $1.2 billion, is an increase of 
$83.2 million or 7.8 percent more than the fiscal year 2011 request and 
$209 million or 18.1 percent above the fiscal year 2010 enacted 
appropriation. Funding for this program is ramping up for reactor 
design and development efforts for the Ohio Class replacement submarine 
($121 million), refueling of the Land-Based Prototype ($99.5 million), 
and recapitalization of the naval spent nuclear fuel infrastructure for 
the Spent Fuel Handling Recapitalization program ($53.8 million) at the 
Naval Reactors Facility located at the Idaho National Laboratory.
            Advance Responsible Environmental Cleanup
    The fiscal year 2012 budget includes $6.13 billion for the Office 
of Environmental Management (EM), to protect public health and safety 
by cleaning up hazardous, radioactive legacy waste from the Manhattan 
Project and the cold war. This funding will allow the program to 
continue to accelerate cleaning up and closing sites, focusing on 
activities with the greatest risk reduction. Acceleration of cleaning 
up sites where funding would have immediate impact was established as 
the overarching objective of the $6 billion in ARRA funding. EM will 
use the remaining $309 million of ARRA funding during fiscal year 2012 
as it completes footprint reduction and near-term completion clean-up 
activities.
    As DOE continues to make progress in completing environmental 
cleanup, the fiscal year 2012 budget request of $170 million for the 
Office of Legacy Management supports DOE's long-term stewardship 
responsibilities and payment of pensions and benefits for former 
contractor workers after site closure.
    department of energy fiscal year 2012 program office highlights
Office of Science--Invest in the Building Blocks of American Innovation
    DOE's Office of Science (SC) delivers scientific discoveries and 
major scientific tools to transform our understanding of energy and 
matter and advance the energy, economic, and national security of the 
United States. SC is the largest Federal sponsor of basic research in 
the physical sciences, supporting programs in areas such as physics, 
chemistry, biology, environmental sciences, applied mathematics, and 
computational sciences. In fiscal year 2012, DOE requests $5.4 billion, 
an increase of 9.1 percent more than the fiscal year 2010 current 
appropriation, to invest in basic research. The fiscal year 2012 
request supports the President's Strategy for American Innovation, and 
is consistent with the goal of doubling funding at key basic research 
agencies, including the SC. The fiscal year 2012 SC budget request 
supports the following objectives from the Strategy, including:
  --Unleash a clean-energy revolution;
  --Strengthen and broaden American leadership in fundamental research;
  --Develop an advanced information technology ecosystem; and
  --Educate the next generation with 21st century skills and create a 
        world-class workforce.
    In fiscal year 2012, SC continues to support fundamental research 
for scientific discovery, but today our country needs to move strongly 
to solve our energy problems. Therefore, the central theme of this 
year's budget in SC is research in new technologies for a clean-energy 
future that address competing demands on our environment. These 
efforts, coordinated with DOE applied technology programs and with 
input from the scientific community and industry, will emphasize 
research underpinning advances in noncarbon-emitting energy sources, 
carbon capture and sequestration, transportation and fuel switching, 
transmission and energy storage, efficiency, and critical materials for 
energy applications.
    In the area of advancing noncarbon energy sources, the fiscal year 
2012 budget request will provide for new investments in the science of 
interfaces and degradation relevant to solar photovoltaics, basic 
actinide chemistry research related to advanced nuclear fuel cycles, 
and research in materials under extreme environments relevant to 
extreme nuclear technology environments, and genomics-based research on 
biological design principles and synthetic biology tools to underpin 
bio-based energy solutions. Carbon capture and sequestration research 
will focus on novel molecular design for materials and multiscale 
dynamics of flow and plume migration, respectively. SC will initiate an 
energy systems simulation research effort focused on predictive 
modeling of combustion in an evolving fuel environment in support of 
DOE's efforts in transportation and alternative fuels. Also 
underpinning transportation and fuel switching, as well as energy 
storage, the fiscal year 2012 request will support an Energy Innovation 
Hub for Batteries and Energy Storage. The Fuels from Sunlight Hub, 
established in fiscal year 2010, as well as the EFRCs and DOE Bioenergy 
Research Centers also continue. Research in enabling materials sciences 
will support needs of future electricity transmission systems and novel 
building materials to improve building efficiencies.
    The fiscal year 2012 budget request also provides for foundational 
science in condensed matter and materials physics, chemistry, biology, 
climate and environmental sciences, applied mathematics, computational 
and computer science, high-energy physics, nuclear physics, plasma 
physics, and fusion energy sciences; and provides for research 
facilities and capabilities that keep U.S. researchers at the forefront 
of science. The fiscal year 2012 request supports targeted increases in 
areas such as computational materials and chemistry by design, 
nanoelectronics, and advanced scientific applications and integrated 
application hardware-software co-design for exascale, which position 
the United States to secure a competitive advantage in high-tech 
industries and maintain international leadership in scientific 
computing. Underlying these investments is the education and training 
of thousands of scientists and engineers who contribute to the skilled 
scientific workforce needed for the 21st century innovation economy.
    The SC supports investigators at about 300 academic institutions 
and from all of DOE laboratories. More than 26,000 researchers from 
universities, national laboratories, industry, and international 
partners are expected to use the SC scientific user facilities in 
fiscal year 2012.
ARPA-E--Transformational Research and Development
    The fiscal year 2012 budget request includes $550 million for the 
ARPA-E plus an additional $100 million for the program from the 
Wireless Innovation and Infrastructure Initiative for a total of $650 
million. ARPA-E was launched in fiscal year 2009 to sponsor specific 
high-risk and high-payoff transformational R&D projects that overcome 
the long-term technological barriers in the development of energy 
technologies to meet the Nation's energy challenges, but that industry 
will not support at such an early stage. An essential component of 
ARPA-E's culture is an overarching focus on accelerating science to 
market. Beyond simply funding transformational research creating 
revolutionary technologies, ARPA-E is dedicated to the market adoption 
of those new technologies that will fuel the economy, create new jobs, 
reduce energy imports, improve energy efficiency, reduce energy-related 
emissions, and ensure that the United States maintains a technological 
lead in developing and deploying advanced energy technologies.
Office of Energy Efficiency and Renewable Energy--Investing in 
        Breakthrough Technology and a Clean-Energy Future
    The Office of Energy Efficiency and Renewable Energy (EERE) 
supports research, development, demonstration, and deployment 
activities on technologies and practices essential for meeting national 
security goals by reducing dependence on oil, meeting environmental 
goals by minimizing the emissions associated with energy production and 
use, and stimulating economic growth and job creation by minimizing the 
cost of energy services. The EERE portfolio emphasizes work areas where 
the potential impact is largest, where Federal funds are most critical. 
It balances investments in high-risk research with partnerships with 
private firms that speed the translation of innovations into practical 
business opportunities. The diverse set of technologies supported helps 
ensure that the United States has many options for meeting its energy 
goals. Program management is designed to identify the best groups in 
the country to address these challenges and supports work in 
universities, companies, national laboratories, and consortia.
    The fiscal year 2012 budget request of $3.2 billion, the increase 
of 44.4 percent more than the fiscal year 2010 current appropriation, 
is aimed at accelerating innovation and change in the Nation's energy 
economy. The request includes programs associated with meeting the 
President's goals of investing in the next generation of clean-energy 
technologies, vehicles and fuels, and energy efficiency measures that 
reduce energy use in Federal agencies and the industrial and building 
sectors.
            Clean, Renewable Energy Generation
    The fiscal year 2012 budget request continues to work to transform 
the Nation's energy infrastructure by investing more than $1,164.9 
million in a variety of renewable programs including:
  --solar ($457 million);
  --wind ($126.9 million);
  --water ($38.5 million);
  --hydrogen ($100.5 million);
  --biomass ($340.5 million); and
  --geothermal ($101.5 million).
    Research, development, and deployment of these technologies will 
reduce the production of greenhouse gas emissions and revitalize an 
economy built on the next generation of domestic production. The 
request includes the solar SunShot program which will invest in 
transformative research focusing on achieving radical cost reductions 
in photovoltaic modules, balance of systems, and power electronics.
            Energy Efficiency
    DOE implements a number of efforts to increase energy efficiency in 
homes, transportation, and industry. The fiscal year 2012 budget 
requests $1,805.3 million to accelerate deployment of clean, cost-
effective, and rapidly deployable energy efficiency measures in order 
to reduce energy consumption in residential and commercial buildings, 
and the industrial and Federal sectors. DOE will invest $470.7 million 
in the Building Technologies program and $33 million for the Federal 
Energy Management program. Federal assistance for State-level programs 
such as:
  --State energy program ($63.8 million);
  --Tribal ($10 million); and
  --weatherization assistance program ($320 million) will continue to 
        help citizens implement energy efficiency measures, lower 
        energy costs and greenhouse gas emissions, and build a 
        technical workforce.
    For industry ($319.8 million), DOE will provide a balanced 
portfolio of advanced R&D and pursuit of near-term, low-cost 
opportunities with the objectives of increasing U.S. competitiveness, 
enhancing clean-energy manufacturing, and improving energy 
productivity. There will be a focus on next generation manufacturing 
processes and materials, activities for clean-energy manufacturing, and 
refocused efforts for Industrial Technical Assistance to achieve 
greater results with less funding through more effective leveraging of 
funding for deployment partnerships. A new Energy Innovation Hub on 
critical materials will be competed through the Industrial Technologies 
program. The fiscal year 2012 request also includes $588 million to 
accelerate research, development and deployment of advanced vehicle 
technologies, working in concert with biomass RD&D to reduce the use of 
petroleum and greenhouse gas emissions.
    Better Buildings Initiative for Commercial Energy Savings.--The 
President's Better Buildings Initiative is focused on achieving a 20 
percent improvement in commercial buildings' energy use by 2020. The 
initiative will include many new components to achieve this goal. The 
following are supported in DOE's fiscal year 2012 request: launch of 
the Race to Green competitive grant program for States and municipal 
governments to encourage higher standards for commercial energy 
efficiency, which is funded within the Buildings Technologies program; 
a new pilot loan guarantee program to support energy efficiency 
retrofits for buildings that serve as community assets; and increased 
R&D funding for building technologies. The Department intends to work 
with the business and academic communities to make their organizations 
leaders in saving energy.
Office of Electricity Delivery and Energy Reliability--Enabling a 
        Clean-Energy Economy
    The Office of Electricity Delivery and Energy Reliability (OE) is 
responsible for leading national efforts to modernize the electric 
grid, enhance the security of energy infrastructure, and facilitate 
recovery from disruptions to the energy supply. DOE's fiscal year 2012 
budget request for OE of $238 million, a 38 percent increase more than 
the fiscal year 2010 appropriation, represents a clear and determined 
effort to accelerate the transformation of one of the Nation's key 
enablers of a clean-energy economy--the electricity delivery system.
    The U.S. electricity delivery system was built on technology that 
was developed early in the 20th century and designed for the demands 
and challenges of that era. Today, this aging and often congested 
system is facing many new and complex challenges that require 
considerable improvements in the physical and technological components 
of the system. In order to alleviate the stress on the system from 
increasing demand for electricity and to enable greater use and 
integration of renewable and distributed resources, all while 
maintaining the reliability, security, and affordability of electric 
power, R&D breakthroughs and new energy management approaches are 
critical in the areas of transmission and distribution, energy storage, 
and cyber security.
    OE's fiscal year 2012 budget request provides $193 million for R&D 
in these critical areas to bring the next generation of grid 
technologies closer to deployment and commercialization. The increased 
investment reflects the President's vision and OE's role in competing 
in a worldwide technological race. As such, with $20 million in fiscal 
year 2012, OE will establish a new Energy Innovation Hub, or in the 
words of President Obama, one of ``the Apollo projects of our time''. 
The Smart Grid Technology and Systems Hub will bring together a 
diverse, multi-disciplinary group to develop an integrated approach to 
enhancing smart grid technologies and systems. OE will also expand its 
advanced modeling capabilities to include other system layers in order 
to provide a more in-depth system understanding. The energy storage 
program will expand to aggressively support the deployment of grid-
scale energy storage technologies with new demonstrations, and the 
cyber security program will continue to focus on the development and 
integration of secure control systems.
    The budget request continues to support Permitting, Siting, and 
Analysis (PSA) with $8 million to develop and improve policies, State 
laws, and programs that facilitate the development of electric 
infrastructure needed to bring new clean-energy projects to market, and 
to provide technical assistance to States and regions. It also supports 
Infrastructure Security and Energy Restoration (ISER) with $6.2 million 
to enhance the reliability and resiliency of critical energy 
infrastructure and to facilitate recovery from energy supply 
disruptions.
Office of Environmental Management--Meeting Commitments and Making 
        Progress
    The mission of EM is to complete the safe cleanup of the 
environmental legacy brought about from more than six decades of 
nuclear weapons development, production, and Government-sponsored 
nuclear energy research. This clean-up effort is the largest in the 
world, originally involving 2 million acres at 110 sites in 35 States, 
dealing with some of the most dangerous materials known to man.
    EM continues to pursue its clean-up objectives within the overall 
framework of achieving the greatest comparative risk reduction benefit 
and overlaying regulatory compliance commitments and best business 
practices to maximize cleanup progress. To support this approach, EM 
has prioritized its clean-up activities:
  --Activities to maintain a safe and secure posture in the EM complex;
  --Radioactive tank waste stabilization, treatment, and disposal;
  --Spent nuclear fuel storage, receipt, and disposition;
  --Special nuclear material consolidation, processing, and 
        disposition;
  --High-priority groundwater remediation;
  --Transuranic and mixed/low-level waste disposition;
  --Soil and groundwater remediation; and
  --Excess facilities deactivation and decommissioning.
    The fiscal year 2012 budget request for $6.13 billion will fund 
activities to maintain a safe and secure posture in the EM complex and 
make progress against program goals and compliance commitments by 
reducing the greatest risks to the environment and public health, using 
science and technology to reduce life-cycle costs, and reducing EM's 
geographic footprint by 90 percent by 2015. EM continues to move 
forward with the development of the capability for dispositioning tank 
waste, nuclear materials, and spent (used) nuclear fuel. The budget 
request includes the construction and operation of three unique and 
complex tank waste processing plants to treat approximately 88 million 
gallons of radioactive tank waste for ultimate disposal. It will also 
fund the solid waste disposal infrastructure needed to support disposal 
of transuranic and low-level wastes generated by high-risk activities 
and the footprint reduction activities.
    EM carries out its clean-up activities with the interests of 
stakeholders in mind. Most importantly, EM will continue to fulfill its 
responsibilities by conducting cleanup within a ``Safety First'' 
culture that integrates environment, safety, and health requirements 
and controls into all work activities to ensure protection to the 
workers, public, and the environment, and adheres to sound project and 
contract management principles. EM is also strengthening its project 
and planning analyses to better assess existing priorities and identify 
opportunities to accelerate clean-up work. Working collaboratively with 
the sites, EM continues to seek aggressive but achievable strategies 
for accelerating cleanup of discrete sites or segments of work. In 
addition, functional and cross-site activities such as elimination of 
specific groundwater contaminants, waste or material processing 
campaigns, or achievement of interim or final end-states are being 
evaluated.
    After the EM program completes cleanup and closure of sites that no 
longer have an ongoing DOE mission, postclosure stewardship activities 
are transferred to the Office of Legacy Management (LM). LM also 
receives sites remediated by the U.S. Army Corps of Engineers (Formerly 
Utilized Sites Remedial Action program) and private licensees (Uranium 
Mill Tailings Radiation Control Act, title II sites). Post closure 
stewardship includes long-term surveillance and maintenance activities 
such as groundwater monitoring, disposal cell maintenance, records 
management, and management of natural resources at sites where active 
remediation has been completed. At some sites the program includes 
management and administration of pension and post-retirement benefits 
for contractor retirees.
LPO--Helping Finance Clean-Energy Deployment
    Innovative Technology Loan Guarantee Program.--To encourage the 
early commercial deployment of new or significantly improved 
technologies in energy projects, DOE requests up to $36 billion in loan 
guarantee authority for nuclear power facilities and $200 million in 
appropriated credit subsidy to support an estimated $1 billion to $2 
billion in loans for renewable energy system and efficient end-use 
energy technology projects under section 1703 of the Energy Policy Act 
of 2005. The additional loan guarantee authority for nuclear power 
projects will promote deployment of new plants and support an 
increasing role for private sector financing. The additional credit 
subsidy will allow for investment in the innovative renewable and 
efficiency technologies that are critical to meeting the 
administration's goals for affordable, clean energy, technical 
leadership, and global competitiveness.
    The fiscal year 2012 budget also requests $38 million to evaluate 
applications received under the eight solicitations released to date 
and to ensure efficient and effective management of the Loan Guarantee 
program. This request is expected to be offset by collections from 
borrowers authorized under title XVII of the Energy Policy Act of 2005 
(Public Law 109-8).
    Advanced Technology Vehicle Manufacturing Program.--DOE requests $6 
million to support ongoing loan monitoring activities associated with 
the program mission of making loans to automobile and automobile part 
manufacturers for the cost of re-equipping, expanding, or establishing 
manufacturing facilities in the United States to produce advanced 
technology vehicles or qualified components, and for associated 
engineering integration costs.
    Better Buildings Pilot Loan Guarantee Initiative for Universities, 
Schools, and Hospitals.--To spur investment in energy efficiency 
retrofits for buildings which serve as assets to our communities, DOE 
requests $100 million for loan guarantee subsidy costs to support up to 
$2 billion in loan authority for universities, schools, and hospitals. 
This pilot program is one component of the President's Better Buildings 
Initiative and would fund cost-effective technologies and measures to 
assist universities, schools, and hospitals save on energy usage and 
associated energy costs. DOE also requests $5 million for 
administrative expenses to carry out the program. The request is 
subject to the enactment of legislation authorizing this program.
Office of Nuclear Energy--Investing in Energy Innovation and Technical 
        Leadership
    DOE is requesting $852.5 million for the Office of Nuclear Energy 
(NE) in fiscal year 2012--a decrease of 0.6 percent from the fiscal 
year 2010 current appropriation. NE's funding supports the advancement 
of nuclear power as a resource capable of meeting the Nation's energy, 
environmental, and national security needs by resolving technical, 
cost, safety, proliferation resistance, and security barriers through 
research, development, and demonstration as appropriate.
    Currently, nuclear energy supplies approximately 20 percent of the 
Nation's electricity and more than 70 percent of clean, noncarbon-
producing electricity. More than 100 nuclear power plants are offering 
reliable and affordable baseload electricity in the United States, and 
they are doing so without air pollution and greenhouse gas emissions. 
NE is working to develop innovative and transformative technologies to 
improve the competitiveness, safety and proliferation resistance of 
nuclear energy to support its continued use.
    The fiscal year 2012 budget supports a balanced set of RD&D 
activities. This program is built around exploring, through its R&D: 
technology and other solutions that can improve the reliability, 
sustain the safety, and extend the life of current reactors; 
improvements in the affordability of new reactors to enable nuclear 
energy to help meet the administration's energy security and climate 
change goals; development of sustainable nuclear fuel cycles; and 
minimization of risks of nuclear proliferation and terrorism.
    NE is requesting $125 million for Reactor Concepts Research, 
Development and Demonstration. This program seeks to develop new and 
advanced reactor designs and technologies. NE is also requesting $67 
million for the Light Weight Reactor SMR Licensing Technical Support 
program, which will support cost-shared design certification and 
licensing activities for two light water reactor-based designs. SMRs 
are a technology that DOE believes has the promise to help meet energy 
security goals. Work will continue on R&D for the Next Generation 
Nuclear Plant to support demonstration of gas-cooled reactor technology 
in the United States. The program also supports research on Generation 
IV and other advanced designs and efforts to extend the life of 
existing light water reactors.
    The fiscal year 2012 request includes $155 million for Fuel Cycle 
Research and Development to perform long-term, results-oriented 
science-based R&D to improve fuel cycle and waste management 
technologies to enable a safe, secure, and economic fuel cycle. The 
budget also requests $97.4 million to support the Nuclear Energy 
Enabling Technologies program, focused on the development of cross-
cutting and transformative technologies relevant to multiple reactor 
and fuel-cycle concepts. The Crosscutting Technology Development 
activity will focus on a variety of areas such as reactor materials, 
creative approaches to further reduce proliferation risks, and 
establishing advanced modeling and simulation capabilities to 
complement physical experimentation. The Transformative Nuclear 
Concepts R&D activity supports, via an open, competitive solicitation 
process, investigator-initiated projects that relate to any aspect of 
nuclear energy generation ensuring that good ideas have sufficient 
outlet for exploration. Modeling and Simulation Energy Innovation Hub, 
supported within this program, will apply existing modeling and 
simulation capabilities to create a ``virtual'' reactor user 
environment to simulate an operating reactor and is a prime example of 
the type of crosscutting, transformative activity that will enhance 
many research areas within NE. NE will also continue its commitments to 
investing in university research, international cooperation, and the 
Nation's nuclear research infrastructure--important foundations to 
support continued technical advancement.
Office of Fossil Energy--Sustaining American Energy Options Through 
        U.S. Ingenuity
    The fiscal year 2012 budget request of $521 million for the Office 
of Fossil Energy (FE) will help ensure that the United States can 
continue to rely on clean, affordable energy from traditional domestic 
fuel resources. The United States has 25 percent of the world's coal 
reserves, and fossil fuels currently supply more than 80 percent of the 
Nation's energy.
    DOE is committed to developing technologies and providing 
technology-based options having public benefits including enhanced 
economic, environmental and energy security impacts. In FER&D, the 
emphasis, in keeping with Presidential priorities, is in supporting 
long-term, high-risk initiatives targeted at carbon capture and storage 
as well as advanced energy systems and on cross-cutting research.
    In addition, $122 million of FE's $521 million request will be to 
provide for national energy security through the continued operations 
of the Strategic Petroleum Reserve (SPR). The budget proposes to sell 
$500 million of SPR oil in order to provide operational flexibility in 
managing the SPR.
NNSA--Leading Global Partners on Nonproliferation by Securing 
        Vulnerable Nuclear Materials; Reaffirming Commitment to 
        Stockpile Modernization
    NNSA continues significant efforts to meet administration and 
secretarial priorities, leveraging science to promote U.S. national 
security objectives. The fiscal year 2012 President's budget request 
for NNSA is $11.8 billion; an increase of 5.1 percent from the 
President's fiscal year 2011 request. The 5-year fiscal year 2012-2016 
President's request for NNSA reflects the President's global nuclear 
nonproliferation priorities and his commitment to modernize the U.S. 
nuclear weapons complex and sustain a strong nuclear deterrent, as 
described in the 2010 Nuclear Posture Review (NPR) Report, for the 
duration of the New START Treaty and beyond. NNSA's defense and 
homeland security-related objectives include:
  --ensuring that the U.S. nuclear deterrent remains safe, secure, and 
        effective while implementing changes called for by the 2010 NPR 
        and the New START Treaty;
  --broadening and strengthening the NNSA's science, technology, and 
        engineering mission to meet national security needs;
  --transforming the Nation's cold-war era weapons complex into a 21st 
        century national security enterprise;
  --working with global partners to secure all vulnerable nuclear 
        materials around the world and implement the President's 
        nuclear security agenda expressed in the May 2010 National 
        Security Strategy and the Nuclear Posture Review report; and
  --providing safe and effective nuclear propulsion for U.S. Navy 
        warships.
    The fiscal year 2012 budget request of $7.6 billion for the weapons 
activities appropriation provides funding for a wide range of programs. 
Requested activities include providing direct support for the nuclear 
weapon stockpile, including stockpile surveillance, annual assessments, 
life extension programs, and warhead dismantlement. science, 
technology, and engineering programs are focused on long-term vitality 
in science and engineering, and on performing R&D to sustain current 
and future stockpile stewardship capabilities without the need for 
underground nuclear testing. These programs also provide a base 
capability to support scientific research needed by other elements of 
DOE, the Federal Government national security community, and the 
academic and industrial communities. Infrastructure programs support 
facilities and operations at Government-owned, contractor-operated 
sites, including activities to maintain and steward the health of these 
sites for the long term and construct new facilities that will allow 
the United States to maintain a credible nuclear deterrent. The unique 
nuclear security expertise and resources maintained by NNSA are made 
available through the National Laboratories to other DOE offices, 
agencies and to the Nation for security and counterterrorism 
activities.
    The weapons activities request is an increase of 8.9 percent more 
than the President's fiscal year 2011 request. This level is sustained 
and increased in the later out-years. The multi-year increase is 
necessary to reflect the President's commitment to maintain the safety, 
security, and effectiveness of the nuclear deterrent without 
underground nuclear testing, consistent with the principles of the 
Report on the Plan for the Nuclear Weapons Stockpile, Nuclear Weapons 
Complex, and Delivery Platforms (known as the ``1251 Report'') and the 
Stockpile Management program as stipulated in sections 1251 and 
3113(a)(2) of the National Defense Authorization Act for Fiscal Year 
2010. Increases are provided for direct support of the nuclear weapon 
stockpile, for scientific, technical, and engineering activities 
related to maintenance assessment and certification capabilities, and 
for recapitalization of key nuclear facilities. The President's request 
provides funding necessary to protect the national resource of human 
capital at the national laboratories through a stockpile stewardship 
program that exercises and retains these capabilities.
    The fiscal year 2012 request for Defense Nuclear Nonproliferation 
(DNN) is $2.5 billion; a decrease of 5.1 percent from the President's 
fiscal year 2011 request. This decrease reflects completion of long-
lead procurements for the Mixed Oxide Fuel Fabrication Facility 
(MOX) and Waste Solidification Building (WSB). It also 
reflects our decision to await an agreement between the United States 
and Russia on detailed implementation milestones prior to requesting 
additional United States-pledged funding to support Russian plutonium 
disposition. The administration prioritizes U.S. leadership in global 
nonproliferation initiatives as directed through the National Security 
Strategy and has advanced this agenda through commitments from global 
partners during the 2010 nuclear security summit. In addition to the 
programs funded solely by the NNSA, DNN programs support interagency 
and international efforts to protect national security by preventing 
the spread of nuclear weapons and nuclear materials to terrorist 
organizations and rogue states. These efforts are implemented in part 
through the International Atomic Energy Agency, the G8 Global 
Partnership against the Spread of Weapons and Materials of Mass 
Destruction, and the Global Initiative to Combat Nuclear Terrorism.
    DNN supports the President's goal to secure vulnerable nuclear 
materials around the world within 4 years. The Global Threat Reduction 
Initiative's emphasis in fiscal year 2012 is to convert domestic and 
international nuclear reactors from weapons-usable highly enriched 
uranium fuel to low-enriched uranium fuel (LEU); while preserving our 
capability to produce the critically needed Molybdenum 99 isotope. The 
fiscal year 2012 President's request for International Nuclear 
Materials Protection and Cooperation reflects selective new security 
upgrades to buildings and sites in accordance with the President's goal 
to secure vulnerable nuclear materials around the world within 4 years, 
as well as enhancements and sustainability support for previous work. 
The Fissile Materials Disposition program continues domestic 
construction of the MOX Fuel Fabrication Facility scheduled 
to come online in 2016; and design for the pit disassembly and 
conversion capability to provide it with plutonium oxide feedstock.
    The President's request of $1.2 billion for Naval Reactors is an 
increase of 7.8 percent more than the President's fiscal year 2011 
request. The program supports the U.S. Navy's nuclear fleet, comprised 
of all of the Navy's 72 submarines and 11 aircraft carriers, which 
constitute 45 percent of the Navy's combatants. The United States 
relies on these ships every day, all over the world, to protect our 
national interests. The budget provides funding increases for the Ohio 
class replacement submarine to design and develop required submarine 
reactor plant technologies. R&D is underway now, and funding during 
this Future Years Nuclear Security program is critical to support the 
long manufacturing spans for procurement of reactor plant components in 
2017, and ship construction in 2019. Resources are also requested in 
fiscal year 2012 to support design work for the recapitalization of the 
spent nuclear fuel handling infrastructure and refueling of the Land-
based prototype.
    The Office of the Administrator appropriation provides for Federal 
program direction and support for NNSA's headquarters and field 
installations. The fiscal year 2012 request is $450.1 million; a 0.4 
percent increase more than the President's fiscal year 2011 request. 
This provides for well-managed, inclusive, responsive, and accountable 
organization through the strategic management of human capital, 
enhanced cost-effective utilization of information technology, and 
integration of budget and performance through transparent financial 
management practices. The increase reflects additional Federal 
oversight for construction of the Pit Disassembly and Conversion 
project, the Uranium Processing Facility, and the Chemistry and 
Metallurgy Research Replacement Facility.

                               CONCLUSION

    The United States faces a choice today: will we lead in innovation 
and out-compete the rest of the world or will we fall behind? To lead 
the world in clean energy, we must act now. We can't afford not to.
    Thank you, and now I am pleased to answer any questions you may 
have.

                         HYDROGEN TECHNOLOGIES

    Senator Feinstein. Thank you very much, Secretary.
    I am going to try to get three quick questions in my first 
round. One is on hydrogen and one is on the SunShot Initiative, 
and the third on the loan guarantee program.
    You have proposed to cut hydrogen by $100 million in fiscal 
year 2012. That is a cut of $70 million from the 2010 level, 
and you zeroed out all funding for fuel cells in the fossil 
energy program. We gather your advisory committee was dismayed 
by that. But I think it is important that you tell us what your 
current view is on hydrogen technology and whether it can be 
successful or not.
    Secretary Chu. Sure. First, in terms of the fuel cells, we 
do have a research program in fuel cells for stationary fuel 
cells. There has been very good progress made in fuel cells and 
in the longevity in fuel cells and bringing down the costs.
    The idea of a hydrogen economy is something that is very 
helpful, but the fundamental issue is we need a source of 
hydrogen that will make good economic sense. Right now, our 
hydrogen comes from reforming natural gas. When you reform 
natural gas, you create hydrogen and carbon dioxide, so in 
terms of the carbon benefit, there is none unless you sequester 
the carbon dioxide.
    In order for that to happen, I think we have to develop 
more sources of natural gas that can allow you to do those 
things. So, the first priority is to develop sources of 
hydrogen that will make economic sense, and to sequester the 
excess carbon dioxide. There is a hydrogen storage issue in 
automobiles. Right now, we are going to continue the research 
in the area of high-pressure tanks. And so, there is the 
storage part, there is the source of hydrogen, which I think is 
the most fundamental issue. You know, it is a transformation of 
energy from one form to another. And the fuel cell part is 
actually going along well. The stationary fuel cells, because 
of the higher efficiency, are something we can see can be 
deployed quickly in the next 5 or 10 years. There are a number 
of commercial companies doing this, and so we will continue in 
research on developing better fuel cells for stationary 
sources. And we also are looking at how we can actually develop 
the source of hydrogen that will actually lead to a hydrogen 
economy.
    So, that is why we are----
    Senator Feinstein. Quickly, how realistic is all of that?
    Secretary Chu. I think the fundamental thing is the source 
of hydrogen. Right now it is natural gas, but natural gas will 
have to be significantly more abundant and less costly. We are 
going in the right direction, but it will have to be 
significantly more abundant. Or the gasification of coal, 
again, with carbon sequestration, but that is a technology 
issue to make it cost effective. But there has to be--it is 
turning a hydrocarbon into hydrogen and sequestering the 
carbon.

                   SOLAR TECHNOLOGY PRICES/SUBSIDIES

    Senator Feinstein. Okay. Now, the second question is on the 
SunShot Initiative, which seeks to reduce the cost of solar 
power to roughly $1 per watt and at that price. The goal is for 
solar power generation to become cost effective without 
subsidies with other forms of electricity generation.
    I am very pleased to see that the SunShot Initiative will 
include the photovoltaic manufacturing initiative. As you will 
recall, several years ago, you told me that photovoltaic was 
not cost effective, but you expected at that time that it would 
take 4 to 5 years to become cost effective. So, I would like to 
know what progress has been made there as well. Do we need to 
focus resources on the SunShot Initiative on domestic 
manufacturing?
    Secretary Chu. Well, first, the cost of photovoltaic--of 
solar energy has gone down by a factor, too. It has been 
decreased by 50 percent in the last 5 or 6 years worldwide. The 
full cost of 10 megawatt or above--large sale--not rooftop, but 
large scale. So it has come down by that much.
    In this decade, we have talked to business, not only in the 
United States, but abroad, and every manufacturer says that in 
their business plan, if the cost does not come down by another 
factor or two, we cannot produce them to be a factor or two 
less, then we will probably go out of business. So, they are 
actually banking on this.
    And then taking that as the starting point, we have started 
to engage in these companies and in ways to say, can we 
accelerate this? Can we do something with these companies and 
with research that can actually accelerate this progress? And 
so, our ambitious goal is to say, can you reduce the cost by 75 
percent instead of 50 percent by the end of this decade? That 
is a magical price because at that price, in many parts of the 
United States, then without subsidy, it is competitive with any 
other form of energy. So, that is a big deal.
    When you drop by 50 percent, there are certain areas of 
peak demand, I think it will be. And so, our goal in most of 
our energy endeavors is to devise a plan so we can get there 
without subsidy. You know, I, too, share the belief that you 
might need to subsidize for a little while, but you do not want 
to subsidize for 100 years. And is there a technology pathway 
that can develop these things without subsidies? And so, the 
SunShot Initiative is really to say this is within reach. And 
there has been remarkable progress.
    In terms of your question about manufacturing, 
manufacturing innovation is another key part of what we will 
need to do in order to be competitive with the rest of the 
world. And it is that manufacturing innovation that began with 
Henry Ford, that he was willing to invest 5 years of Ford's 
money in a beginning company to develop an assembly line. They 
started by making handmade cars, but it transformed the 
automobile industry.
    So, there are things that we are invested in that we are 
actually quite excited about--new approaches of either thin 
film or even silicone, a totally new approach to manufacturing 
sili-composed cells could actually transform the landscape. And 
so, we are hoping companies research and develop new 
manufacturing things that will give us a competitive edge in 
the decades to come. And that is an important part of what we 
are doing as well.
    Senator Feinstein. Thank you very much. My time is up.
    Senator Alexander.
    Senator Alexander. Madam Chairman, I see the Republican 
leader is here. I would be glad to defer to him and then go 
after him.
    Senator Feinstein. I was looking on the wrong side for you, 
Mitch. Sorry.
    Senator Alexander. We hope he is there.
    Senator Feinstein. I recognize the Republican leader.
    Senator McConnell. Thank you very much, Senator Alexander 
and Chairman Feinstein.

                   ENRICHED URANIUM TAILS AT PADUCAH

    Mr. Secretary, welcome. I am here to focus your attention 
on the Paducah Gaseous Diffusion Plant, which is, I believe, 
you know, has been enriching uranium for 60 years. It happens 
to be the economic engine of far western Kentucky. Many people 
think of Kentucky as a coal State, which we are, but we are 
also a nuclear State.
    The plant has 1,200 employees and it is in the process of 
closing down. There are, however, 40,000 cylinders of depleted 
uranium at Paducah, which are typically referred to in the 
business as tails. If they were re-enriched, it would be a 
profitable venture.
    These are Government-owned resources, highly valued, stored 
in a lot which could be sold to create revenue for the 
Government, and in the meantime, happily enough for western 
Kentuckians, keep 1,200 people from collecting unemployment. 
So, a revenue raiser for the Government and an avoidance of 
unemployment for 1,200 people, are you familiar with the tails 
issue at the uranium enrichment plant?
    Secretary Chu. Yes, I am.
    Senator McConnell. It is my understanding that DOE, at 
least at the moment, does not have a current plan for re-
enriching those tails at Paducah. Is that correct?
    Secretary Chu. That is correct.
    Senator McConnell. Kentucky's unemployment rate is right at 
10 percent. We cannot afford to lose 1 more job, let alone 
1,200. If there is the potential for DOE to save these jobs, 
would you not think that would be worth pursuing?
    Secretary Chu. We are certainly very concerned about any 
job impacts in actions we take, but there are other issues that 
I would be happy to talk to you about, having to do with 
another commitment for uranium in another uranium enrichment 
plant. We cannot release more than 10 percent of the uranium 
market because the uranium mining industry in the United States 
could be affected. And so, we are bound to only release 10 
percent or less of what is ever on the market. We have 
commitments in 2011 and 2012 for another uranium enrichment 
process going on. And so, we have made that commitment, and so 
we have to try to figure out what to do about the Paducah plant 
beyond that. But we are certainly very aware and very 
sympathetic to this plight.
    Senator McConnell. Well, let us assume we do not do that. 
Then the question is, do we have the funds in the 2012 budget 
to safely and secure idle the plant after it closes and returns 
to the control of the Government?
    Secretary Chu. Well, what we need to do is work with you on 
trying to figure out a path forward for these jobs. I have to 
be candid. The gaseous diffusion technology is one which is 
very energy intensive. And I would rather us invest in more 
forward-leaning technologies such as improved centrifuges. I do 
think the United States would like to have an in-house 
institute for a technology of our----
    Senator McConnell. But that is not the issue at Paducah, is 
it? That is going to happen in Portsmouth.
    Secretary Chu. No, it is going to happen in Portsmouth.
    Senator McConnell. So, in Paducah, the issue is, will we 
re-enrich the tails and actually make money for the Government, 
or if we are not going to do that, will the Government pay for 
a cleanup, because we have been getting the clean-up funding on 
an annual basis, but there is apparently no plan in your budget 
for cleanups after the operation ceased. So, under this 
scenario, it strikes me the Government loses an opportunity for 
revenue, we lose 1,200 jobs, and you are not funding the 
cleanup, which would cost you money, whereas re-enriching the 
tails would actually gain the Government money. Is that--am I 
correctly understanding that?
    Secretary Chu. Yes and no. I mean, certainly it will be our 
obligation to clean up if and when Paducah closes down. But 
that depleted uranium will be there. And, again, to go forward 
in the most cost effective way, if there is a technology that 
they can more effectively enrich those tails, we would be more 
biased to just doing that. But certainly we have an obligation 
to clean up that plant, once it is closed down.
    Senator McConnell. When are we going to see the plan?
    Secretary Chu. We will get back to you and your staff on 
that.
    Senator McConnell. Well, you know, we have got 1,200 
employees sitting there wondering if they are going to be 
without a job. And I understand it is a tough time for 
everyone. Unemployment is high in Kentucky. But here you have 
an opportunity to continue 1,200 people working, actually raise 
revenue for the Government by re-enriching these tails. And 
what I think I hear you saying is you have got no plan for 
either contingency at the moment. Is that correct?
    Secretary Chu. Right now, we have to make very, very hard 
decisions given the budget reality. As Chairman Feinstein said, 
we do not expect the Congress to give us our proposed budget. 
We need to work----
    Senator McConnell. How many of your tough decisions give 
you an opportunity to actually raise revenue?
    Secretary Chu. Well, we are actually raising revenue on, as 
you mentioned, on the United States Enrichment Corporation 
(USEC) side for the same reason. And so, it is raising revenue 
in the most cost-effective way. And we always like to raise 
revenue. But remember, we are at this limit of 10 percent.
    Senator McConnell. Well, it is not a very satisfying answer 
if you are an employee in western Kentucky. I think I correctly 
heard you that you have no plan to re-enrich the tails, and you 
have currently not intended to budget, at least according to 
our figures, by 2014, you are not even going to meet the annual 
cleanup needs that have been met on an annual basis at the 
plant, and have no current plan for addressing the shortfall.
    Secretary Chu. We can look at the cleanup issue, but, 
again, you know, the tails are still there. And it is not as 
though we are either going to move on it next year or the year 
after.
    Senator McConnell. No, I understand that. But you start re-
enriching them now; you still employ 1,200 people----
    Secretary Chu. Right.
    Senator McConnell [continuing]. And the Government makes 
money. You leave them sitting there and then you have got the 
clean-up obligation, which costs you money. I am curious as to 
why you think this makes sense.
    Secretary Chu. Because if we do this enrichment with this 
old and now it is a very energy-consuming technology that was 
developed during World War II, and there are better 
technologies that we would like to use and develop in house, in 
house meaning in the United States. And so, again, it is a 
decision with our limited budget.
    Senator McConnell. So, you would rather make the money 
later than make the money now.
    Secretary Chu. Well, I would go back to--we can enrich it 
now, but then we cannot make the money because we cannot 
release it on the market because of already what is being put 
in place with USEC.
    Senator McConnell. Well----
    Senator Feinstein. Senator----
    Senator McConnell. Thank you very much, Madam Chairman.
    Senator Feinstein. I have tried to be as liberal as 
possible.
    Senator McConnell. No, I appreciate it very much. Thank you 
so much.
    Senator Feinstein. Thank you very much. Senator Lautenberg, 
early bird, you are next.

                           GLOBAL ENERGY RACE

    Senator Lautenberg. Thank you, Madam Chairman, and thank 
you, Secretary Chu for the wonderful work you do for our 
country and for helping us now to try and solve problems that 
will directly affect how our economy recovers and how we 
protect ourselves from a lack of energy to fuel our needs.
    In 2009, China surpassed the United States in private 
sector clean-energy investment for the first time. In 2010, 
China began to pull away, attracting $54 billion in private 
investment. Now, they recently announced that its government 
would begin investing the equivalent of $75 billion in clean 
energy annually. Now, will your agency's roughly $30 billion 
budget invest enough for us to regain the lead in the global 
clean-energy race?
    Secretary Chu. You are quite right to be concerned about 
China's investment, but it is not only China. I would add it is 
Korea and it is the European Union, Germany, and Great Britain. 
Other countries are also looking at clean-energy development, 
both on the efficiency side and on the generation side. These 
are going to be the big business opportunities in the world 
market going forward in the coming decades. And so, what we 
need to do is position the United States so that we can be a 
leader in this. We have been a leader in other technologies. It 
is, quite frankly, ours to lose because we still have the best 
research institutions. We have a national lab system that is 
incomparable. And we need to develop the mechanisms to allow 
American industry to make the inventions and to manufacture in 
the United States.
    Now, in terms of what you specifically asked, what China 
and others are doing, they are helping companies with, for 
example, loans and--or loan guarantees. As you know, we have an 
oversubscribed loan program. I think Senator Feinstein was--we 
could not get to that part of it, and it is something that we 
feel it is a good, highly leveraged way of supporting industry 
investment and to--because when we see these companies 
beginning to build manufacturing facilities abroad, this is one 
of the factors that comes through loud and clear, that they are 
getting loan guarantees from countries like China. And I think 
so, looking forward, I would love to work with the Congress. 
You know, part of our loan guarantee program is dependent upon 
if ARRA falls through--it is highly leveraged, and it is a 
guarantee. So, those programs I think would be an important 
part going forward.
    Senator Lautenberg. Right, but does that, Secretary Chu, 
suggest that we are going to fall further behind this--back of 
these countries with the kind of budget that we are talking 
about at this moment?
    Secretary Chu. Well, I think, you know, that's why the 
President has chosen to increase the energy budget, when other 
agencies were going down. And the President said that this is a 
very--in order to preserve the future and to win the future, in 
order to actually go forward, that investments in the science 
and research and the development of these things is going to be 
crucial to our economic prosperity going forward. And this is 
why there were hard decisions made and why the energy budget 
saw the increase that it did.

                    ENVIRONMENTAL IMPACT OF FRACKING

    Senator Lautenberg. Earlier this month, you appointed a 
panel to study and make recommendations on the practice of 
fracking. Cornell University recently released a study that 
says the natural gas extracted using fracking as the technique 
to produce--can produce much more global warming pollution than 
coal. And given the administration's commitment to reduce 
greenhouse gasses, would your panel consider recommending that 
the industry capture some of these emissions--can they capture 
some of these emissions from natural gas?
    Secretary Chu. Well, this advisory board, is actually going 
to be meeting for the first time today and tomorrow. I am aware 
of that Cornell study. There was, in fact, another paper just 
published last week in the ``Proceedings of the National 
Academy of Sciences'', which I read very thoroughly. And it 
does raise some questions that will need to be answered 
regarding this.
    We are very concerned about the environmental impact, but 
we also see that if you can do this safely and you can extract 
the gas safely, and not have excess emissions or pollution of 
water tables, that it is a transition to a clean-energy future, 
and it is producing energy in the United States. And so, the 
administration wants to do this is an environmentally 
responsible way. We need to do it in an environmentally 
responsible way. There is no question about that. But there are 
these studies that we are very well aware of, and personally 
given the charge of the subcommittee, have spent a couple of 
weekends reading about this stuff, learning about this, and 
there are some concerns. But we want to get all the 
perspectives and find out what is really going on.
    Senator Lautenberg. We will be anxious to get the panel's 
report, and hope that we can establish the fact that this does 
not present other environmental problems----
    Secretary Chu. Right.
    Senator Lautenberg [continuing]. That it worsens the 
situation rather than improve it.
    Thank you very much, Mr. Secretary.
    Senator Feinstein. Thank you very much, Senator Lautenberg.
    Senator Alexander.

                     ENERGY RESEARCH AND SUBSIDIES

    Senator Alexander. Thank you, Madam Chairman.
    Mr. Secretary, Governor Haslam recently traveled to visit 
with you and Senator Cochran and me about environmental cleanup 
at Oak Ridge, urging a focus on the dangers of the mercury 
there. And factoring in the large population in the region, I 
would be remiss if I did not thank you for the meeting and 
underscore the importance of that.
    My questions, though, are along the lines of my comments in 
the opening statement about energy research. Does it sound 
about right that the Department has about $6 billion more or 
less for energy research?
    Secretary Chu. Roughly speaking, yes.
    Senator Alexander. Roughly $6 billion. What should it be? 
If you were Professor Chu and were not bound by the office of 
budget, I mean, what should--well, let me put it another way. 
You talk about hubs; I talk about Manhattan Projects. I think--
are we not both talking about accelerating energy research in a 
focused way?
    Secretary Chu. Yes, and, I am here in defense of the 
President's budget----
    Senator Alexander. Right.
    Secretary Chu [continuing]. But I would love to see 
increases. I think, as I said before, that this is research we 
do with a goal of getting the private sector to pick up this 
stuff and run with it and to give them, as Chairman Feinstein 
said, you know, the research center--Argonne National 
Laboratories, using a light source, a facility actually gave a 
leading edge and developed a series of patents that allow us to 
make better batteries.
    Senator Alexander. So, if I may interrupt, we are talking 
about 500-mile batteries and $1 a watt solar power and a better 
way to recycle, use nuclear fuel----
    Secretary Chu. Right, right.
    Senator Alexander [continuing]. And trying to lead the 
country in that. And even crusty, miserly Republicans often 
agree that research is an appropriate role of the Federal 
Government, while we might worry about some other things.
    Given the importance of that--I mean, and as we--given the 
budget problems we have with 40 cents of every $1 being 
borrowed and we all know that we are going to have a rough 2, 
3, or 4 years trying to make up a budget, should we not be 
looking hard at such things as long-term subsidies? I think 
particularly, you know, my colleagues talk about big oil all 
week, you know. I think we ought to talk about big wind. And I 
mentioned earlier that we are committed to spending $26 
billion--taxpayers are--over the next 10 years on wind 
subsidies in a production tax credit that was passed as a 
temporary measure in 1992.
    Now, you have got in your budget money for research on 
offshore wind. It seems to me that is appropriate. It seems to 
me that to continue to subsidize over a long term a mature 
technology is not appropriate--jump starting electric cars, 
jump starting natural gas, research for offshore wind. All 
those things might be appropriate, but if we looked at long-
term energy subsidies, whether they're big oil or big wind, it 
looks to me like we could find money to take a fairly modest 
energy research budget of $6 billion and make it $7, $8, $9, or 
$10 billion, and move us much more rapidly toward a low-cost, 
clean-energy future rather than a high-cost, clean-energy 
future. I mean, we have $1 solar power. That is cheaper. If we 
have 500-mile batteries, that is cheaper. That uses a lot less 
gas.
    So, why shouldn't we be developing a policy that takes 
money from these long-term subsidies and putting them into 
energy research?
    Secretary Chu. I would agree with you absolutely that what 
we need to do in designing any energy research program or any 
energy development--we are responsible for the entire 
innovation chain. And what we need to do is design things and 
have a program going forward where we do not want to start 
businesses that cannot survive indefinitely without a subsidy. 
That is just not the way to do things. So, I think we are in 
total agreement with that, whereas--and you spoke about this--
for example, offshore wind has great possibilities. We need to 
develop that to get it going. And the SunShot, if we see--it is 
going to be an international race, and it is. And batteries, it 
is an international race.
    Senator Alexander. Right.
    Secretary Chu. And, therefore--but it is going to be the 
research----
    Senator Alexander. But the amount of money to do the 
research is relatively modest. I mean, you asked for--in 
offshore wind it was $27 million maybe----
    Secretary Chu. Right.
    Senator Alexander [continuing]. For small nuclear reactors, 
$60 million, ARPA-E is $100 million and--well, you have asked 
for $500 million, but you got--I mean, you got $180 million.
    Secretary Chu. Right.
    Senator Alexander. And these big subsidies, whether it is 
big wind or big oil, you know. It seems like the money could be 
better spent, and that one of the things we might be able to 
help do is reduce the long-term subsidies and focus it more on 
energy research where I think there is probably a consensus 
about the appropriateness of Federal spending.
    Thank you, Madam Chairman.
    Senator Feinstein. Thank you, Senator.
    Senator Cochran.

                   NUCLEAR ENERGY AND ENERGY SECURITY

    Senator Cochran. Madam Chairman, thank you for chairing 
this hearing.
    Welcome, Mr. Secretary. We appreciate your being here to 
help us understand the administration's proposal for spending 
in your Department for the next fiscal year.
    I am pleased to notice that it is recommended that nuclear 
energy continue to have a place in the national strategy for 
energy independence and guarantee supplies of energy for our 
country. There is an increase in funding for the Office of 
Nuclear Energy we noticed in the budget request.
    I wonder, what do you think the priorities of that office 
should be in terms of reaching our goals and helping maintain 
our energy security as a Nation?
    Secretary Chu. Sure. I would love to answer that question. 
Again, the way we are approaching this is we are looking at 
what industry is going to be doing and then saying what can we 
do to add value to this? And it is on things like, for example, 
using high-performance computing, which is in a very sweet 
spot.
    Like what is done at Senator Alexander's laboratory in Oak 
Ridge. They are the leader of the fastest civilian--fastest. 
Actually now it is China that is pushing out ahead. But to use 
high-performance computing to design next-generation reactors 
and how to deal with these things so you can skip engineering 
steps, engineering design things that you can simulate in a 
much wider space. So, we think that we can do things of that 
nature.
    Senator Alexander spoke about how to develop fuel recycling 
that makes economical sense and that makes anti-proliferation 
sense, so that the amount of electricity you generate from the 
nuclear field could be 10, 20 times more than what we do today. 
And so, for the same amount, you can do a lot more. I think 
that is something that is very much part of what we want to do, 
you know.
    So, new recycling technologies, there is a long road home, 
but we have to continue these new advanced reactor 
technologies, things of that nature.

                      STRATEGIC PETROLEUM RESERVE

    Senator Cochran. One decision that has been made by the 
Department relates to the Strategic Petroleum Reserve (SPR). In 
our State of Mississippi, that program is dead in the water, as 
I understand it. There is a decision that I am advised canceled 
the expansion of the SPR in our State. And we have submitted 
requests for information, explanation, what plans do you have 
for that program, and we have not received a response from DOE. 
I wish you could go back and see if you do have a response to 
that question. We would like to know about what your plans for 
the future are with respect to the SPR. You could ask for that 
now, if you would like.
    Secretary Chu. Well, we will get back to you on the 
details. But right now, the SPR, we are required to have a 90-
day supply in case of a disruption of supply, of which 75 days 
comes from the SPR and the rest from civilian stock. And right 
now, the--we are repairing one of our caves, but we are 
actually at very close to full capacity. And so, but we can get 
back to you on the details of what we have planned going 
forward.
    But the point is, we are at--we are very close to maximum 
capacity. We have a cavern or two that needs repair. I do not 
quite remember whether this was in Mississippi or not, and we 
have to tend to that.
    Senator Cochran. Well, we do know that we have been trying 
to get answers to questions about that for 2 years now, I'm 
told, and have not gotten a satisfactory response. So, I do not 
know that there is a response, but I think we are entitled to 
hear----
    Secretary Chu. Sure, you are right.
    Senator Cochran [continuing]. What your plans are.
    Last year after the President recommended cancelling that 
program, the Congress voted to rescind all the funds that we 
had worked for to provide the Department about $70 million for 
the expansion of the SPR. So, there is a breakdown in 
communication and about whether you need the money. And if you 
are not going to use the money, we may help you think up other 
ways to do it than what you are planning to do with the money.

                      YUCCA MOUNTAIN/NUCLEAR WASTE

    Well, there was a Blue Ribbon Commission chartered last 
year by President Obama to study nuclear waste disposal 
options. I wonder if you could give us any information about 
this program, whether or not you have a specific plan. We 
understand the recently cancelled Yucca Mountain program is in 
limbo, unclear about whether funds are going to be used for 
that program or not. It gives me the impression that we are 
having a hard time finding out what the Department is up to in 
some of these areas. Could you tell us about what your plans 
are for storage at Yucca Mountain?
    Secretary Chu. Sure. First, I believe that there is a first 
draft of an outline of some of the recommendations from this 
Blue Ribbon Commission. I think rather than comment here on 
these draft things that have been put out, I would rather them 
give an official report. Well, let me comment on one or two of 
them.
    What they have said is that, first, that there--one of the 
things they said again goes to Senator Alexander's point that 
while there is no immediate technology that we can use for 
reprocessing, you know, we still should continue to develop 
that technology. They have looked at other countries that have 
found siting for notably Sweden and Finland, where there was a 
process that seemed to have more acceptance of the local people 
in those regions of the country. And so, at least in this draft 
recommendation they are saying we should look at those 
processes. We have examples of low-level waste where things 
have gone very successfully, and there has not been opposition. 
And so, there are a number of other things.
    So, we need to go far in this. It is the responsibility of 
DOE. As you know, we are positive on nuclear power in the 
future. And whatever occurs is a DOE responsibility to deal 
with the waste.
    Senator Cochran. Madam Chairman, my time has expired.
    Senator Feinstein. I thank you very much, Senator Cochran.
    Senator Johnson.
    Senator Tim Johnson. Secretary Chu, welcome.

    DEEP UNDERGROUND SCIENCE AND ENGINEERING LABORATORY AT HOMESTAKE

    I am pleased to see DOE is continuing support for the Deep 
Underground Science and Engineering Laboratory at Homestake at 
Homestake Mine in Lead, South Dakota. I appreciate that your 
agency included $15 million for the project in your fiscal year 
2012 budget request.
    I understand DOE is nearing conclusion of an internal 
review of the project and am interested in its results. 
Specifically, could you talk about how DOE is prepared to work 
with the project team to ensure that your recommendations are 
known and included in future financial and construction 
planning?
    Secretary Chu. Well, first, I know we are undergoing this 
review, and I have not specifically spoken with Bill Brinkman 
about this yet. We are working, though, as you well know--the 
National Science Foundation (NSF), is having some second 
thoughts--this is very discouraging to us--about that, 
especially since they started it.
    But in any case, I think we are trying to figure out a path 
forward on the investments that have been made by South Dakota 
and DOE and NSF. So, in the interim we continue to get funds to 
pump the water, continue doing this. But if we lose on the long 
term this--you know, the support of what was supposed to be 
roughly a 50/50 partner, we are trying to understand how we can 
go forward in a perhaps reduced program or what our options 
are, especially in whatever funding we will be getting in 
fiscal year 2012 and going forward.
    And so, these, again, are going to be very difficult 
choices. There are a few requirements that we would like to 
have done, and we still remain committed. We need to get some 
of those experiments done. But as I said, I have not seen the 
report or--and so I will be waiting for that.
    Senator Tim Johnson. On a related note, as you know, a 
great deal of activity is already underway at Homestake, and we 
had previously hoped NSF would be, at this stage, be providing 
more support for these activities. In lieu of significant NSF 
construction funding, and in order to preserve the great 
progress and investment we have already made, what is DOE 
prepared to do to ensure that no jobs are lost while you 
evaluate your long-term plans for the project and for high-
energy physics in general?
    Secretary Chu. Yes. We are very aware of that and trying 
our best to keep the--there is a very dedicated scientific team 
that has been assembled on this. And while we try to put this 
path forward, again for 2011 and 2012, there is going to be 
continued funding, we do not want to lose and dissipate the 
scientific teams that have been developed, and just as we do 
not want the water to come back into the mine.
    And, again, I do not know exactly the timing of when or how 
the Office of Science will bring forward a recommendation to 
me, you know, and I am sorry. It is disappointing, but that is 
all I can say about it. And it is an unbiased--completely 
unbiased point of view, I have to say that my old laboratory 
was the lead laboratory in this, so I know personally how it is 
affecting a lot of people. But, you know, not that I am going 
to play favorites, but it is--I know personally--and I know 
personally. As you know, I visited the mine in South Dakota, 
and I know personally all the investments that South Dakota has 
made in this.

                       HIGH-PRIORITY EXPERIMENTS

    Senator Tim Johnson. You referenced high-priority 
experiments. Could you list a few?
    Secretary Chu. Sure. For high-energy physics, we are 
investing in what we call the high-intensity frontier. We are 
also investing in the highest-energy machine, CERN, the 
highest-energy machine there. So, right now because of what 
happened decades ago for the super connecting collider, the 
highest-frontier energy machine is turning on the large hadron 
collider at CERN. And they had a hiccup, but they have 
recovered well from that hiccup. And so, what we have done is 
we still want to deal with high-energy physics as a significant 
part of our program. We still wanted to go forward. And so, the 
good news is American scientists are actively participating in 
that machine, and, for the first time, an American scientist is 
now the lead in one of the major detectors.
    But we also want to make investments here in the United 
States. And so, we have going forward, and with the Fermilab 
Lab director, Piermaria Oddone, he made and we collectively 
made a decision that since the large hadron collider is going 
great guns, we need to invest in the future, which is the new 
sources for neutrino beams at Fermilab. So, we have every 
intention of continuing to invest in Fermilab in those--and, 
again, as you know, in one of the experiments in the Fermilab 
investments for the neutrinos is the use of the detector in 
South Dakota. So, that is why we are especially disappointed in 
the events that unfolded last year.
    Senator Tim Johnson. Thank you, Secretary Chu.
    Senator Feinstein. Thank you, Senator Johnson.
    Senator Landrieu.
    Senator Landrieu. Thank you, Madam Chair.

                        MISSISSIPPI RIVER LEVEL

    If the subcommittee will just give me 1 minute of latitude 
before we get into Energy, Madam Chair, I wanted to just call 
everyone's attention to the fact that the Mississippi River, as 
we meet here today, is flowing at an extraordinary historic 
level, and this subcommittee has jurisdiction over water and 
energy. And I just wanted to put into the record, Madam Chair, 
these statistics that are startling.
    The river is flowing at 172 billion cubic feet per week, 
7.2 billion cubic feet every hour. And as one article today 
described it, it said it is a snarling, powerful beast barging 
its way south. This subcommittee has jurisdiction, as you know, 
and has done, I might say, Madam Chair, a remarkable job in the 
course of the last decade with a lot of help to build this 
Mississippi River system. But it is going to be up to us to 
watch to see how it works in the coming days and weeks and be 
prepared to do what we need to do to make sure that people are 
protected should this ever happen again. So, I would like to 
submit that to the record without objection.
    Senator Feinstein. So ordered.
    I thank you for the comments, and I thank every member of 
this subcommittee. You know, I come from earthquake country, 
know what you have gone through constantly, and how hard it has 
been.
    Senator Landrieu. And it is not just Louisiana; it is 
Tennessee and Mississippi. And Senator Cochran full well knows 
what the people in north Mississippi are experiencing right now 
and the Senator from Tennessee. But this subcommittee has 
jurisdiction over that system.

          LOAN GUARANTEES FOR ADVANCED TECHNOLOGY AUTOMOBILES

    But three questions really quickly. One, Mr. Secretary, you 
and I have spoken several times about this, a project that is 
pending before your Department now. The Department's loan 
programs have supported more than $30 billion in loans, loan 
guarantees for about 28 clean energy and enhanced automotive 
efficiency projects. One of those projects is pending in 
Louisiana right now. And the reason I bring this to your 
attention is it is very timely. Our legislature is meeting as 
we speak. They have reserved basically $68 million to support 
this project.
    The application has pending before you and your Department 
for 2 years. Do you have any update for us at all on Next Auto 
Works, what the timeline looks like, when they might know yes 
or no, because this application we think is quite strong and 
quite competitive, it could create more than 1,000 jobs in this 
part of the country. But as importantly as that, it can produce 
vehicles that can achieve 40 miles per gallon, which I know the 
chair, who has been a leader on CAFE standards, would 
appreciate. This is new technology for the combustible engine, 
but a new technology that seems to us to meet the goals of what 
the President and what you are touting.
    Can you give us any update at all about where we would be 
with this application?
    Secretary Chu. Well, I do not think it would be appropriate 
in a Senate hearing. As you know, in policy, we really--the 
details of specific loan applications, we have to honor the 
relationship we have with the applicant.
    Senator Landrieu. I realize that, but generally--and I 
realize you cannot give the details. I am not asking. But 
generally, does this fit with your goals of creating new 
automobile companies that are pressing forward with new 
technologies to produce automobiles that can almost double our 
efficiency? Does that generally meet with the goals of your 
Department?
    Secretary Chu. Well, if you are asking--I think what you 
are asking is, are we in favor of the advanced technology 
automobile program that we have and its loan, and the answer is 
yes. We think it played a very important part in actually 
helping not only, you know, innovative companies, but also 
established companies, in developing a new line of automobiles 
with advanced technology that get better mileage and are at 
high efficiencies. That means that we can, again, take back a 
leadership role in automobiles. I mean to be candid, we had 
this for three-quarters of a century, but it is something, you 
know, that Europeans and Japanese and the Koreans are now 
wrestling with. And so, we are in favor of supporting 
innovative technologies like that.
    Senator Landrieu. Well, let me ask you because I do not 
want to lose my time, if you could give to my office some time 
by the end of the week just an update on this, because I have 
to tell our legislature something. I mean, they have been 
holding $68 million to support this in a public/private 
partnership, Federal/State partnership. And, you know, we have 
got budget constraints like everyone.

                                FRACKING

    My second question is, and Senator Lautenberg alluded to 
this, we have had a breakthrough, as you know, in this country 
in finding almost 100 years, I understand, of natural gas 
reserves. This is terrific. People want to go around saying we 
have no reserves of oil, which is not true. We have not looked 
for the oil. I think we have a lot more. But we know how much 
natural gas we have. The industry has surprised itself at what 
it is finding.
    So, my question is on this fracking issue, what is the 
Department doing and are you being aggressive to find some 
conclusions? We think, because we have done this for a while in 
Louisiana, that fracking is safe under certain circumstances. 
What are you doing to come to some final determination on this 
so we can take advantage of 100 years of supply of natural gas, 
which can reduce our greenhouse gases, I understand, by 40 to 
50 percent?
    Secretary Chu. Well----
    Senator Landrieu. If you could do it in 30 seconds or less.
    Secretary Chu. Thirty seconds or less. First, we have to 
establish what is really going on, and it could be different in 
different regions of the country. And so, that is why the 
President asked DOE to form this subcommittee. And so, we need 
to find out what is going on.
    Senator Landrieu. When do you expect some results or some 
conclusions from that?
    Secretary Chu. We are tasked that 90 days after the first, 
which is starting today, 90 days from now we will have a 
preliminary set of recommendations. And that committee--that 
subcommittee then goes--in that 90 days goes before the full 
advisory----
    Senator Landrieu. Madam Chair, let me just say I think that 
is a very important component of our work in this next year 
because natural gas is, you know, a 40 percent reduction in 
greenhouse gasses. We have a 100-year supply. The technology, I 
believe, is there. I think we are going to find that there is a 
safe path forward. So, if we could just take a focus on that. 
And then my time has run out, but I am going to submit a 
question in writing about exporting natural gas and the pending 
application you have for southwest Louisiana.
    Secretary Chu. All right. Thank you.
    Senator Feinstein. Thank you very much, Senator.
    Senator Collins.
    Senator Collins. Thank you.
    Madam Chairman, Senator Graham had to leave and asked that 
he be afforded the opportunity to submit questions for the 
record.
    Senator Feinstein. Absolutely.
    Senator Collins. Thank you.

                  DEEPWATER OFFSHORE WIND TECHNOLOGIES

    Secretary Chu, it is great to see you again. Let me begin 
by thanking you for visiting the University of Maine last June 
to see the very exciting research and development technology 
that is under way in the area of deep water offshore wind. I 
would say to my friend and colleague from Tennessee that deep 
water wind does not face the same challenges as land-based 
wind, because it can be located out of sight. And the winds are 
much stronger and more persistent offshore, so you have more 
energy produced. But there is the need for investment into the 
technologies, so that the challenges of siting wind turbines in 
deep water offshore can be met. And I am very excited about the 
work that is going on at the University of Maine.
    To bring the Secretary up to date, a key milestone was 
reached just this month in which three scale models of floating 
turbines were successfully tested. And that is providing key 
data to advance the technology.
    But one of my concerns is that our country should not lose 
the global race in developing deep water offshore wind 
technology. And if you look at this chart, and I believe the 
Secretary has it as well, we are losing the race right now. 
Consented means permitted, for those who are not into the lingo 
here. But as you can see, Europe is making considerable 
investments in deep water offshore wind, Asia is as well, while 
the United States really lags. And yet, this offers the 
potential of providing clean domestic energy to large 
population centers in close proximity to wind resources.







    I am pleased to see the investment that the DOE is making. 
And just for the record, to make sure that I understand the 
Department that you have submitted, it is my understanding that 
you just delivered the operating plan for the remainder of 2011 
to the Appropriations Committee this week. And it includes 
funding under the category of Advanced Technology Demonstration 
Project-Wind Energy. And just to clarify, it is the intention 
of the Department to do a competitive solicitation for deep 
water wind energy using some portion or all of that funding?
    Secretary Chu. If it is deep water, the answer is yes.
    Senator Collins. And that is the answer I was hoping to 
hear, so I am pleased that that is the case.
    Senator Alexander made a very important point, that we have 
these technologies that are not going to be able to move 
forward unless we have a partnership with the Federal 
Government, with State government, and with the private sector. 
And I believe that that investment of $26.3 million will help 
jump start the investment.
    I would note that the State of Maine has passed a bond 
issue and is providing millions of dollars for this as well. 
And we have also put together a consortium of private companies 
in Maine that are investing. And we are working with a company 
that is partially owned by the Netherlands that also is 
investing in this technology. But it really is very exciting.
    Can you give me some idea of what the time table for 
putting out the solicitation for that $26 million is?
    Secretary Chu. I would need to get back to you on the 
details of it, but we hope it is soon. Again--see? This is 
really good. You are on a roll--in a couple of weeks.
    Senator Collins. That is also great news because I think it 
is important that we move forward.
    Secretary Chu. I think the best news is Senator Alexander 
actually said a kind word for wind.
    Senator Collins. Believe me; that made my day. I sent him a 
little note.
    Secretary Chu. Because I read his book.
    Senator Collins. I mentioned that there is a consortium in 
Maine; it is called the Deep Sea Wind Consortium, which is led 
by the University of Maine. But it is a broad-base 
collaborative effort that involves 35 partners, including the 
State of Maine, academic institutions, nonprofits, utilities, 
and industry leaders. And what we have found is that kind of 
collaborative interdisciplinary approach is absolutely 
essential when you are trying to spur innovation further.
    When there are a lot of Federal agencies that are involved 
in the effort to jump start offshore wind, and I am hoping that 
we can see a similar collaboration among the Federal agencies 
and departments that are involved so that we can avoid 
duplication and maximize efficiency, and stretch those 
resources.
    Could you share with us how DOE is working, particularly 
with the Department of the Interior, which has some permitting 
responsibilities, but there are other Federal partners as well, 
like NSF, the Fish and Wildlife Services.
    Secretary Chu. Yes. I think because these are, you know, 
largely going to be in Federal waters that is the Department of 
the Interior's jurisdiction, that they are very supportive of 
this. But, of course, you know, you have to go through the 
necessary requirements because of exactly what you said there, 
you know. There could be environmental concerns, and you have 
to make sure that you examine them in a thoughtful about them.
    But I think there is a general acknowledgment. If you can 
get the technology to work and that is an if and so is the 
research. The opportunity for offshore wind and deep water wind 
is there. It is closer to population centers. It is steadier, 
and the siting problems are not as great as long as, you know, 
environmentally we make sure that that is okay. So, the 
opportunity is great, but it is one of reliability and 
technology.
    And again--and so that is why we chose to shift the 
research. We think onshore wind is a mature technology. And so, 
to focus on the more innovative aspects and that is why we 
repositioned the program.
    Senator Collins. Thank you, thank you for your efforts, and 
thank you, Madam Chairman.
    Senator Feinstein. Thank you very much, Senator Collins.
    Senator Collins. Thank you, Senator Alexander.
    Senator Feinstein. Senator Murkowski.
    Senator Murkowski. Thank you, Madam Chairman. And 
Secretary, welcome. Good to see you as always.
    I have a whole laundry list of questions, and many of them 
are questions that were asked of you at the hearing before the 
Energy Committee back in February--February 16. And I did not 
have an opportunity to ask all of the questions, and so we 
submitted them for the record to be received in writing. We 
have not yet----
    Secretary Chu. Really?
    Senator Murkowski [continuing]. Received those responses, 
so I wanted to alert you to that because some of the questions 
I am going to ask you now are hopefully ones that you have 
already asked and they are in the mail. But if I can just let 
you know that we are still awaiting some of those.
    Secretary Chu. I apologize for that. We were trying to get 
our system to be more responsive and quicker, but I will look 
into that.
    Senator Murkowski. Well, we will look forward to receiving 
them.

                           GEOTHERMAL FUNDING

    I wanted to ask you just a little bit about the budgets 
increase for geothermal. Your budget calls for an increase in 
funding. It is actually a tripling in funding from $101 
million--to $101 million from existing $43 million. Kind of 
pleasantly surprised me because I am a big advocate of 
geothermal and what we can do with that resource.
    But the question to you this morning or this afternoon is 
whether or not the Department will be able to spend this out in 
a timely way. We have, and you have been updated on this, but 
we have been dealing with a project in NecNec, Alaska, an 
enhanced geothermal project that we feel has great prospect, 
great hope, and we are really encouraged about it. It is 
exactly what the Department has supported in the past. But the 
sponsors have had just a nightmare of issues in dealing with 
your Golden Field Office.
    Now, some of the issues have come about because of things 
that the sponsor was involved with. But if you are able to 
secure money in the budget for the geothermal component, what 
assurances can you give us that the Department is able to get 
these dollars out into the field in a timely manner so that we 
can move these technologies?
    Secretary Chu. I think it was remarked already before, we 
use--we have an existence proof that within DOE and within the 
Federal Government, you can create a funding organization that 
is nimble, that is thorough, that has the high standards of 
review processes, and that is RP. And we are now focusing very 
quietly on getting that way of doing business out to the rest 
of DOE. There are pockets where it is very good, and there are 
pockets where it is less good. And so, we are very committed in 
order to get these processes moving in a much more efficient 
way. And, quite frankly, it would improve the way we do things.
    And so, I will look into this because what we are finding 
is sometimes we have a field office that is almost in 
competition with central headquarters, and then all of a 
sudden, the Freedom of Information Act, they start to debate 
what is going on.
    Senator Murkowski. Well, I am glad that you recognize that 
because that seems to be the sense that we have as we are 
working with constituents on this. So, if you can look into 
that. But again, from the bigger perspective, we want to make 
sure that if these dollars are directed this way that actually 
they are being translated out into the field.

                             YUCCA MOUNTAIN

    Let me ask you about nuclear and section 302 of the Nuclear 
Waste Policy Act that requires the establishment of the Nuclear 
Waste Fund, collecting fees from the utilities, and contained 
within that--the act, it expressly identifies Yucca Mountain as 
the sole permanent repository. And it further directs you as 
the Secretary to propose an adjustment to the fee that is 
collected from the utilities if the amount collected is 
insufficient or in excess of the amount that is needed to meet 
the costs of construction.
    So, given where we are with the attempted withdrawal of the 
Yucca Mountain license application, do you believe that the 
fees that are collected and deposited within the fund are in 
excess of the amount that is needed? Do you think an adjustment 
of the fee is in order? Where do we go with the collection of 
fees given the status right now in Yucca?
    Secretary Chu. Well, you are right. The status of Yucca is 
yet to be determined. It is in the Nuclear Regulatory 
Commission (NRC) and also in the courts. But regarding the fee, 
we still have a responsibility to deal with their spent fuel.
    And again, a draft recommendation from the Blue Ribbon 
Commission is we do see a need for--they have suggested--again, 
it is just a draft, but they have suggested both interim 
storage sites and also--but eventually as--again, it is going 
to be dependent on the technology going forward at interim 
storage sites, but there will be an eventual time if we develop 
the technologies--recycling--that after that there would need 
to be a permanent waste disposal site, and most likely 
underground.
    Senator Murkowski. Understanding all that, but insofar as 
what is happening right now with the collection of the fees----
    Secretary Chu. Right.
    Senator Murkowski [continuing]. Is the Department, are you 
as the Secretary, looking at whether or not an adjustment might 
be appropriate, given the fact that you have this withdrawal 
that is pending?
    Secretary Chu. Right. We have looked at it, and I think 
your question, if I would rephrase it is, okay, right now it is 
in limbo. That does not mean that going into the future we have 
this responsibility. We do have this responsibility.
    Senator Murkowski. We do, yes.
    Secretary Chu. And because of that, if we--I think it would 
be unwise to say, okay, for the next 5 or 10 years no fee until 
we have a plan going forward, have a slow steady--but we will 
need to--but it is, you know, it is a virtual bank, if you 
will, as you well know.
    Senator Murkowski. Well, and I think the frustration has 
been that, well, if there is a plan in place, I can understand 
why I should be depositing fees. But if there is no plan, you 
are just asking for a collection of fees that seemingly is not 
going to go anywhere. I understand and I think you and I both 
agree we have to deal with the repository issue. But I think 
you can also understand some of the frustration that the 
utilities have out there.
    I am over my time. I thank you, Mr. Secretary. Thank you, 
Madam Chairman.
    Senator Feinstein. Thank you very much, Senator Murkowski.
    Senator Murray.

     OFFICE OF ENVIRONMENTAL MANAGEMENT BUDGET AND NUCLEAR CLEANUP

    Senator Murray. Thank you very much, Madam Chairman. 
Secretary Chu, welcome to the subcommittee, and I am sure that 
you and everyone else in this room today knows what I am going 
to ask you about, obviously Hanford Nuclear Reservation in my 
home State of Washington.
    As you well know, Hanford is the largest Federal nuclear 
clean-up site in the country, and it is part of the larger 
complex that is run by the Department's Environmental 
Management program.
    When you go back through DOE's lineage, the Department 
actually was created to manage nuclear activities, and the 
Federal Government has a fundamental and legal responsibility 
to clean up the contamination that has been left behind by our 
Nation's nuclear weapons production activities.
    So, I am concerned that that this administration does not 
seem to take these legal obligations seriously because I look 
at the budgets and see that you continue to increase programs 
that do not have any legal obligations associated with them, 
but the Office of Environmental Management (EM) remains largely 
flat. And I do not think I am the only one of my colleagues on 
the subcommittee that is concerned about that.
    So, I wanted to ask you today, what is your plan to 
increase the EM budget to meet our legal commitments on 
cleanup?
    Secretary Chu. Well, first, because of ARRA, and as you 
well know, with your help and others the clean-up program 
received an additional $6 billion in ARRA. Thanks to this 
additional funding, we feel that we can meet our legal 
commitments in 2011-2012, not only in your State, but in 
Tennessee, in South Carolina, and in other States.
    Beyond 2011-2012, we will need to look at our budget 
requirements. With our current budget request we feel 
comfortable through 2012. What is going to happen to our 2012 
budget, which is what this hearing is about, is a real 
question. And, you know, we put in a request in 2011, and in 
2011 we did not get the full amount of that request in the 
continuing resolution. And so, we have to make adjustments.
    I think all the States that have nuclear waste concerns, 
are very concerned about this as well. I think you were not 
here, but Senator Alexander said that Tennessee has nuclear 
concerns. They have a higher density of population. There are 
not only nuclear concerns there are also mercury waste concerns 
there as well.
    So, what we need to do is try to make the best technical 
assessment of the things that have the highest risk and 
remediate the risk in the most efficient way possible. That is 
where we are.
    EM has done a very good job in a number of projects that 
are ahead of time and ahead of budget. However the waste 
treatment plant is at risk for going over budget, so we have 
diverted additional funds to the waste treatment plant so that 
we can----
    Senator Murray. Well, let me get into that for just a 
minute--in just a minute. But overall, the only legal 
obligations that your Department has are for nuclear weapons 
cleanup and waste storage. And it is disappointing that we have 
to fight the administration year after year after year to meet 
those legal obligations. I am sorry I missed your testimony; I 
had another obligation. But I did read it and it highlights 
significant increases in a lot of other program offices, 
including those without any legal obligations. And so, it is 
troubling to see the EM budget, which is the legal obligation, 
continue to struggle, and the Department is asking for funds 
for other programs. So, I will ask you about some specifics.
    I appreciate the work that the Department has done on the 
waste treatment plant and its use of independent reviews, like 
the construction project reviews. However, I have to tell you I 
am concerned about the singular focus on the waste treatment 
plant. I have been very clear with you and everyone in the 
Department and in the administration that if the administration 
intends to move forward with the proposed modified funding 
profile for the waste treatment plant, the only successful way 
to achieve that is for the administration to increase funding 
for the entire EM program to make sure that we meet the legal 
obligations across the complex. And to be very frank with you, 
I just do not see that happening in you keeping up your side of 
the obligation.
    The waste treatment plant is a priority, but we cannot 
increase funding for that and decrease funding for other legal 
obligations to meet that proposed funding level. So, that is my 
question to you, is how are we going to meet all of those legal 
obligations? The only way to do it is to increase the entire EM 
budget.
    Secretary Chu. Well, yes. As I said, because of ARRA 
investments, we will be meeting our legal obligations in the 
coming couple of years. After that, there is a concern and I 
will be honest with you there. But also, the President put in a 
large increase in the Energy budget in part because of the 
nuclear security issues, but also in large part because we 
think that the investments in the R&D and some deployment 
activities will position the United States for future 
prosperity. Yes, we do not have legal obligations there, but I 
think we have to make these calls as to what would be in the--
with whatever funds the Congress gives us, what would be the 
best----
    Senator Murray. But I do not see how you can say, well, we 
cannot meet our legal obligations, but we are going to increase 
funding elsewhere in DOE.
    Secretary Chu. Well, as I said, because of ARRA and the $6 
billion----
    Senator Murray. Well, and we are talking about fiscal year 
2012 and beyond.
    Secretary Chu. No, fiscal year 2012, I think we will be 
meeting our legal obligations. And then after that, it again 
depends on what the budgets are going to be. The legal 
obligations of our waste legacy, our cold war legacy, is 
something which is, quite frankly, the third-largest Government 
liability. This could be hundreds of billions of dollars. And 
we need to develop a plan going forward, not just for me, but 
my successors, on how do you meet these liabilities. And, 
again, this again goes back to how to best spend that money. 
And so, in order to meet these obligations in the limited 
budget scenario, there are ways that we can do our business 
better in EM.
    Senator Murray. Mr. Secretary, it has to start with the 
request from DOE stating this is our priority, we have to meet 
our legal obligation, and this is what I expect your Department 
to do, and that is why I am disappointed.
    But I have to say that it is a legal obligation. It is a 
moral obligation. It is a real obligation. We have waste at our 
nuclear facilities that is leaking toward the Columbia River, 
and we expect your Department to let the Congress know what the 
obligation is and how we meet it within your budget. And that 
is what I am requesting.
    Secretary Chu. All right.
    Senator Feinstein. Thank you very much, Senator Murray. And 
I am going to begin a second round, and you might just want to 
stay for this first question.

                       SPENT NUCLEAR FUEL STORAGE

    I have become very interested in the nuclear fuel cycle, 
particularly following Daiichi. We have 104 nuclear power 
plants in this country; California has 2. To my understanding, 
we have around two dozen plants that are of the same model as 
the boiling water reactors at Daiichi. Now, when others have 
said, we have better technology, Daiichi comes back and says, 
well, we upgraded ours to meet that as well.
    In looking at the two nuclear power plants in California, 
and particularly the spent fuel part of it, which is what 
Senator Murray is really referring to in a sense, the fact that 
these spent-fuel pools are really, to some extent, fallible. 
They are restacked. They can have large numbers of rods in 
them. In our State, they are kept there for as long as 24 
years. The ranking member and I had the head of the NRC, Mr. 
Jaczko, before us, and he said, well, this is good for 100 
years. Candidly, I do not know how anybody knows that this 
stuff is good for 100 years.
    What I also saw were the dry casts and the transference of 
the rods into the casts. When I asked questions, I was told, 
well, these casts were specially built for transfer to some 
form of repository.
    I have really come to my own conclusion that the way we 
best protect Americans is by having some regional facilities 
where the storage of nuclear waste can be done over the 
hundreds of years, supervised by the Government. Otherwise, who 
knows what Mother Nature will bring down? I mean, I never 
remember funnel clouds in the Pacific. I never remember the 
level of hurricanes that we have had. Now, last night, the 
television said a tornado may be on the ground in a part of 
Virginia, so who knows what might happen?
    I am very concerned that we really need to pay attention to 
spent fuel and what happens to it. I have caught you unaware, I 
am sure. But if you have any comments on this subject, I 
certainly would appreciate hearing them.
    Secretary Chu. Well, okay, I think regarding the spent 
fuels, certainly the accident at Fukushima Daiichi is something 
that we are paying and the NRC especially is paying a lot of 
attention on. Again, it is in NRC's jurisdiction, but there 
is--it is certainly true that when you have a pool of spent 
fuel with water that it is a higher risk than dry cast storage 
where you have just natural air circulation. You do not have to 
worry about something that could breach the pool and things of 
that nature. It is just very passive, and it is more robust.
    And so, certainly I will transition to that so-called dry 
cast storage is something that I anticipate will be happening. 
That is, I think, one of the recommendations--the preliminary 
draft recommendations of the Blue Ribbon Commission, you know. 
I do not want to second guess what the NRC is going to--going 
to be doing about this, but certainly it is something that they 
are saying, yes, that there will be a number of interim--
interim being these dry cast facilities in the United States, 
and I believe that is one of their recommendations, at least in 
draft.
    Senator Feinstein. Good. Good. I was very impressed with 
the testimony of a Dr. Moniz, M-o-n-i-z, from MIT--on the 
subject.

                LOAN GUARANTEE PROGRAM/CREDIT SUBSIDIES

    Let me go to one of my favorite issues, your renewable loan 
guarantee program. I believe you have just $200 million in the 
budget for that and that you have sent letters to 50 renewable 
energy developers who had applied for loan guarantees saying 
their applications were on hold because DOE believed these 
would have difficulty making the September 30 construction 
start requirement.
    I do not know how we developed wind and solar power without 
a very aggressive loan guarantee program. Really, I thought we 
had it, and putting these projects on hold with so little in 
your budget really concerns me because I do not know anybody 
that can do it without a loan guarantee.
    Secretary Chu. So, the reason we looked at this has to do 
with the fact that if you did not have it at a certain time--a 
conditional loan that goes through the approval process, that 
you have conditions that would have to be met, and then you 
would actually have to start on the project before September 
30.
    And so, we looked at the portfolio of our projects. We 
could, with these conditional loans, see that we could use the 
remaining funds. But we did not think it would be fair to those 
companies to continue investing in this knowing that as we 
approach this September 30 deadline where they still would have 
to do other things--they would have to secure the 20 percent 
funding, there would be other conditions, and each loan was 
different. So, we felt that it would not be fair to say, so it 
is put on hold until there is a path going forward and whether 
it is going to be continued funding.
    We have asked for continued funding. I know that Senators 
Bingaman and Murkowski are looking at other mechanisms for 
financing these things. And I am supportive of a capital loan 
program and want to work with the Congress on that.
    Senator Feinstein. Well, thank you very much. We will see 
what we might be able to do, and we will certainly consult you.
    So, I have to excuse myself. Senator, I am going to speak 
on the floor for the nominee that the vote is pending on at 
4:30 p.m., so may I turn it over to you, and you can go full 
bore.
    Senator Alexander. I will go for it.
    Senator Feinstein. Thank you.
    Senator Alexander [presiding]. I will just have a couple of 
questions. I was going to follow up on Senator Feinstein's 
about the loan guarantees. Since nuclear power produces 70 
percent of our carbon-free electricity, and renewable--and 
other renewables produce a few percent, why should nuclear 
power have to pay for its loan guarantee subsidy and wind and 
solar not be?
    Secretary Chu. Well, because there was a--somewhat before 
my time, but the reasoning was that nuclear power is a more 
mature technology. Also fossil fuel has to also, in the 1703 
program, have to pay for their credit subsidies, and that the 
nuclear loans actually should get lower credit subsidy scores. 
I mean, the first one, the one we did do with Southern and 
others had a, you know, a pretty modest grade subsidy. And so, 
but it was felt that because it was a more mature technology.
    Now, you know, things have changed, and so----
    Senator Alexander. Well, did you just testify that wind was 
a mature technology?
    Secretary Chu. Wind is a mature technology, and if we are 
going to fund--well, it is a mature technology in the sense 
that if we are going to fund and research and develop it, we 
would rather fund research and development it in offshore wind 
and, particularly, deep offshore wind.
    Senator Alexander. Well, I am all for offshore wind 
research and development, but I am just wondering if wind is a 
mature technology and it produces a puny amount of intermittent 
power, why you give it, in addition to paying for its loan 
guarantees, why you pay for its loan guarantees and not pay for 
nuclear power's loan guarantees.
    Secretary Chu. Again, well, first, you know, we are----
    Senator Alexander. It is not as if we are building a lot of 
nuclear plants right now. I mean----
    Secretary Chu. Right. So, we have put in a request for 
research in nuclear energy, which I am very pro for. And so, I 
think that to be--but regarding the loans, for example, again, 
if you look at the companies that before had been putting 
forward loan applications, they have the assets and things that 
one could actually say that they--and there is not as much of a 
structure for the deployment of wind. And as that goes forward, 
I think, you know, we----
    Senator Alexander. Well, Mr. Secretary, there is a 2.1 cent 
subsidy for all----
    Secretary Chu. Right, right.
    Senator Alexander [continuing]. The wind power produced in 
the country, which is costing taxpayers $26-plus-billion just 
over the next 10 years. And you do not have anything like that 
for nuclear power.
    Secretary Chu. Yes and no. I mean, I think there is no 
production tax credit, for example.
    Senator Alexander. Right.
    Secretary Chu. I agree with that completely. But, you know, 
the people who are against nuclear feel that there are other 
things that the U.S. Government does for nuclear. And so, gosh, 
I thought you were pro wind.

                         SMALL MODULAR REACTORS

    Senator Alexander. I am pro research, including offshore--
the offshore wind. Let me ask you one last question, and then 
we will conclude. You have a request in your budget for 
research for the small modular----
    Secretary Chu. Right.
    Senator Alexander [continuing]. Reactor, which I know you--
is a priority of yours. My question--and it is of mine, and it 
is of many, many people. It looks like it could be an 
opportunity for the United States, given our experience with 
small reactors with the Navy that these could be reactors that 
we could build here, sell here, lead the world in building, and 
they would be cheaper. And so, there is a nice scenario ahead 
of us for Small Modular Reactors (SMR) perhaps.
    So, my question is, is the amount of money that you have 
requested for this year, what will that permit you to do, and, 
two, are you set up--are you organized to learn anything from 
the United States Navy and its experience since the 1950s with 
small reactors?
    Secretary Chu. Okay. So we preliminarily requested a large 
fraction of that would be to help firms complete their 
engineering designs for NRC approval so they can go forward. 
There is another fraction of, a smaller part, that would be for 
essentially research and development that could complement what 
is being done in the history books.
    We feel that if there are things that--you know, if 
industry can invest in the research and do it, you know, we 
would like them to do it, but if there are other things----
    Senator Alexander. Well, part of your money, if I 
understand it, goes to pay for things that the NRC would 
normally pay for. I mean, you are helping them pay for some of 
their work, is that right or wrong?
    Secretary Chu. No. It is actually to help the companies 
complete engineering design that NRC would require of them.
    Senator Alexander. Okay.
    Secretary Chu. Okay. So, it is really to help the companies 
complete engineering, just as we help with the AP1000 
engineering design. Now, we do have a lot of experience. The 
companies, like BMW and others, that have participated in the 
nuclear--Navy--certainly have experience in there, certainly 
one of the companies that want to go forward and try to get 
licensing from the NRC.
    It is a very different type of reactor. The Navy reactors 
are highly enriched uranium reactors. The newest generation 
will be designed so that they last the whole life of the summer 
in 40 years, a very high-performance reactor. As Admiral Donald 
said, when I first time boarded it at DOE, I asked him, you 
know, can we use your experience with nuclear reactors in the 
Navy, and particularly the summer E-fleet, because this is an 
SMR in the civilian fleet. And he kind of looked at me and 
said, you cannot afford my reactors. They are very high-
performance reactors.
    But there are things that do leak over, and some of the 
companies that build the Navy reactors are--want to go forward 
with the licensing. The most critical thing, again, is we are 
looking at what can we add value to to help industry move along 
in a path that we think is important. But as I think we both 
agree, that SMRs are a totally different model for how to drive 
up safety, drive up the effectiveness and drive down the costs 
and to recapture the nuclear lead. And so, that is why I have 
been out in front and pushing SMRs. I think it is an 
opportunity--very different because the economy of scale of 
building a very large one--you know, 1,000 to a 1,500 megawatt 
reactor, because of all of the fixed costs of siting and 
licensing and everything else.
    Now, you build an assembly line plant that you can ship not 
only anywhere in the United States, but anywhere in the world. 
And you can--and then you can right size the generation to the 
transmission infrastructure at that site. So, it is a very 
different model, but it means that you have to be able to 
essentially mass produce these reactors with that economy of 
number.
    You know, it is not proven that we can do this, but we 
think that there is an opportunity there, and we were also 
trying to engage with industry and the right economic models to 
do this so that--the utility companies--and it also, it is bite 
sized. If you have to spend $8 billion they think very hard 
about that because you are spending a large fraction of the 
company assets on this next project. If it were delayed a year 
or two, that would have financial consequences. When it is a 
factory-generated thing, a lot of those things go away, because 
you can stamp them out. And so, the uncertainties and delays in 
schedules, there is another real opportunity. It takes away a 
lot of the uncertainty people might have about the industry.

                 NUCLEAR FUEL RODS AND DRY CAST STORAGE

    Senator Alexander. Senator Feinstein mentioned before she 
left that the Chairman of the NRC has said that in their 
judgment, used nuclear fuel rods could be stored safely for up 
to 100 years. Do you have any reason to disagree with that?
    Secretary Chu. I think the fuel rods and dry cast storage 
is a determination the NRC has, and what I know about it, that 
appears to be correct. Different than spent fuels and wet 
storage because of things we saw in Fukushima. I do not think 
the NRC said that spent-fuel pools were, you know--you want to 
go to dry cast storage.
    Senator Alexander. No, I think he did.
    Secretary Chu. Oh, he really did?
    Senator Alexander. Yes. I mean, well, there is nothing 
inherently--I mean, the problem is, as long as you have 
electricity and water, your spent-fuel pool should be perfectly 
safe, should they not?
    Secretary Chu. Well, I do not want to contradict Chairman 
Jaczko.
    Senator Alexander. Well, I do not want to misrepresent him 
either, so maybe I----
    Secretary Chu. So, I will----
    Senator Alexander. Maybe I heard him wrong. But the--in the 
first place, you cannot put these rods in the dry cast storage 
immediately, is that correct?
    Secretary Chu. That is correct.
    Senator Alexander. It takes several years before they are 
cool enough to put into dry cast storage.
    Secretary Chu. That is correct. I think----
    Senator Alexander. During that time, you have no reason to 
think that they are in a----
    Secretary Chu. No.
    Senator Alexander [continuing]. In a dangerous condition 
when stored under NRC regulations on site.
    Secretary Chu. Right. No, I agree with Chairman Jaczko on 
that, that, first, you are absolutely right. For the first 5 or 
6 years, they are too hot to be air cooled. And the way, as I--
actually, the way these spent fuels--we have backup systems in 
case the main water supply is interrupted there. There is 
secondary piping and things of that nature.
    Senator Alexander. Well, there are second, third, fourth, 
and fifth redundancies. Well, I mean, I went to Watts Par with 
one of the commissioners recently, and I asked the question, I 
mean, if one--if the backup electricity system goes down, there 
is another electricity system, and then there is another one.
    Secretary Chu. Right.
    Senator Alexander. And then there is finally a way to get 
water in even if all of it goes down.
    Secretary Chu. I think that is absolutely what we need.
    Senator Alexander. So, there is enough water--if there is 
enough available water, the fuel rods would be safe, is that 
not right?
    Secretary Chu. Right, right. And so, you know, can I be 100 
percent guaranteed that nothing would--no, but I think there 
are these backup systems that I feel safe about, okay? And so, 
I would, but without trying to contradict NRC and Chairman 
Jaczko, I think dry cast storage, if you do not have water, you 
do not have that. It would be more robust, but that does not 
mean that the current storage system is endangering Americans.
    Senator Alexander. Okay. Well, thank you, Dr. Chu, for 
coming today.

                     ADDITIONAL COMMITTEE QUESTIONS

    At this time I would like to ask the subcommittee members 
to submit any additional questions they have for the Secretary.
    [The following questions were not asked at the hearing, but 
were submitted to the Department for response subsequent to the 
hearing:]

              Questions Submitted by Senator Patty Murray

                        ENVIRONMENTAL MANAGEMENT

    Question. Mr. Secretary, in your oral testimony you mentioned the 
need to find ways to do business better when referring to Environmental 
Management. I've been pleased to hear about site wide management for 
infrastructure and support services at Hanford.
    Please tell me how this new approach is working and whether it 
would be beneficial at other sites across the Department of Energy 
(DOE) complex.
    Answer. The Department's purpose for the creating a Mission Support 
Contract (MSC) was three-fold:
  --to make it possible for multiple contractors (which is why the MSC 
        concept is particularly well-suited for the Hanford site) to 
        focus on performing their different short- and long-term 
        environmental clean-up mission;
  --to create a scalable infrastructure that can shed excess capacity 
        and its associated costs over time as the clean-up mission 
        progresses; and
  --to provide efficient and effective delivery of infrastructure and 
        site services in support of the clean-up mission.
    DOE developed an aggressive and comprehensive Performance 
Measurement Evaluation Plan (PEMP) that assigns all award fee to 
specific strategic outcomes of the contract. To date, MSC at Hanford is 
achieving the three objectives established for this acquisition. Since 
the start of the contract period in August 2009, the MSC has increased 
service responsiveness to the clean-up mission by implementing 
benchmarked service standards and a broad range of service performance 
measures that obtain feedback from the clean-up contracts regarding 
costs, effectiveness, and quality of services provided. Thus far in the 
contract period of performance, the MSC has greatly increased the 
scalability of the IT infrastructure and leads the DOE complex in 
innovation and efficiencies in this area. Currently, the MSC is 
increasing capacity where required to support the operation of the 
Waste Treatment Plant. Award fee was assigned to the development of an 
Infrastructure Services Alignment Plan to provide a comprehensive plan 
developed in cooperation with other Hanford Site contractors for the 
realignment of the existing infrastructure to meet the future needs of 
the clean-up mission.
    It was anticipated early in the development of the acquisition 
strategy that this approach, if successful, would be a strong candidate 
for implementation at other Environmental Management (EM) sites.
    The primary assumption that a mission support contract would enable 
more focus on the part of the site contractors tasked with the clean-up 
mission (since time of award in 2009) has been proven valid and it is 
felt that with the experience gained, the Department is in a prime 
position to leverage this strategy across the EM complex.
    Question. Secretary Chu, obviously both you and I would like the 
fiscal year 2012 budget request of $6.1 billion to advance through the 
appropriations process to ensure that the Department can meet its legal 
commitments.
    However, in the event that the Congress does not enact an Energy 
and Water Development appropriations bill by September 30, can you 
please tell me how the Department would determine interim funding 
levels for the EM program?
    Answer. We are hopeful that the Congress will complete work on the 
2012 appropriations bill by September 30, 2011, and do not want to 
speculate about hypothetical future scenarios.
    Question. If the Department uses the fiscal year 2011 final year-
long continuing resolution as a base number going into fiscal year 
2012, what will the impacts be at each site in the EM complex in terms 
of work scope, regulatory compliance milestones, and jobs?
    Answer. We are still analyzing the effects of the 2011 funding 
levels and do not want to speculate about hypothetical future 
scenarios.

                         LOAN GUARANTEE PROGRAM

    Question. Secretary Chu, I appreciate your leadership in getting 
the Loan Guarantee program up and running and commend you on efforts 
made thus far, including 28 conditional commitments for loan 
guarantees.
    I understand that last week, the Loan Programs Office sent letters 
to all pending section 1705 loan guarantee applicants, indicating that 
DOE was either putting projects ``on hold'' or moving them through the 
section 1705 process.
    I know that most of these companies have spent significant amounts 
of both time and money to prepare their applications and to comply with 
due diligence requirements, and I am very concerned that a large number 
of companies who have already spent a lot of money are facing a very 
uncertain path forward.
    Can you please tell me how many applicants were in each category--
``moving forward'' versus ``on hold''?
    Answer. The Department notified 17 applicants that their 
applications were moving forward and notified 42 applicants that their 
applications are on hold.
    Question. Of the applicants that were moved forward, did the 
Department include any companies, including affiliate companies, with 
more than one application pending in the section 1705 program?
    Answer. The projects we support are large and complex, and each one 
involves multiple parties, including developers, sponsors, EPC 
contractors, equity participants, advisors, and--in Financial 
Institution Partnership Program transactions--other lenders. Sometimes, 
on a given project, the same entity (or its affiliates) may play more 
than one of these roles. There are entities that are involved, in some 
capacity, in more than one of the projects that were moved forward 
under 1705.
    Question. If so, how many of those companies or their affiliates 
have one or more applications pending? How many applications for each 
of those companies are moving forward?
    Answer. As discussed above, given the many roles that exist in the 
context of each project, it is difficult to provide a precise number in 
response to this question.
    Question. Have any of the companies in the ``moving forward'' 
category already been approved for a loan guarantee under the section 
1705 program?
    Answer. There are entities involved in the ``moving forward'' 
category that are also involved in other projects that have already 
been approved for a loan guarantee under the section 1705 program.
    Question. What are the specific criteria the Department used to 
determine which letter--again, moving forward or ``on hold''--an 
applicant received?
    Answer. The Department based its decision on an application's 
readiness to proceed. Specifically, we identified those projects most 
likely to be in a position to reach financial close and commence 
construction by the 1705 program's congressionally mandated September 
30, 2011 expiration date. These projects received ``moving forward'' 
letters. All other 1705-eligible projects in our pipeline received the 
``on hold'' letter. It was important to notify these companies that we 
do not expect them to receive a loan guarantee under the 1705 program 
as soon as possible, so that they could avoid spending further time and 
resources unnecessarily.
    Question. What is the likelihood that one of the remaining section 
1705 applicants is not able to meet the program's equity requirements?
    Answer. As is always the case, there can be no guarantee that any 
given project will ultimately receive a conditional commitment or, if 
it does, that it will meet all conditions precedent to financial close 
in a timely manner. That said, DOE's decision to move forward with 
certain projects was based on our analysis of the project's ability to 
meet our programmatic requirements by the September 30, 2011 sunset 
date.
    Question. If such a situation occurs, what is the Department's plan 
to ensure those funds are made available to otherwise qualified 
applicants whose applications were put on hold?
    Answer. DOE determined that the projects placed on hold were 
unlikely to reach financial closing by the program's September 30, 2011 
expiration date.
    Question. How will the Department determine those pending 
applications (that have been put on hold in the section 1705 program) 
which will be eligible to access the $170 million in credit subsidies 
appropriated in the fiscal year 2011 year-long continuing resolution 
under the section 1703 program?
    Answer. We are currently working to develop a process for 
implementing this new provision.
    Question. What is the Department's plan to quickly and efficiently 
move those section 1705 applicants to the section 1703 pool?
    Answer. Pursuant to the fiscal year 2011 continuing resolution, 
some of the projects with active 1705 applications (including those put 
on hold) are eligible for the section 1703 program (most of these 
projects would have been eligible for 1703 in any event, provided they 
satisfy certain restrictions in the applicable budget authority). 
Projects eligible for 1703 will not need to submit a new application to 
be considered for a guarantee under that program.
    Question. Will this information be made available to the Congress 
and the applicants?
    Answer. The Department will continue to ensure that applicants and 
the Congress are appropriately informed of programmatic developments.
    Question. How many companies are currently in the application pool 
for the section 1703 program?
    Answer. DOE currently has approximately 20 active applications from 
projects that are eligible for the 1703 program, but not the 1705 
program.
    Question. How will the transfer of eligible applications from the 
section 1705 program affect the current section 1703 program?
    Answer. There will be significant competition among qualified 
applicants for the appropriated funds under 1703.
    Question. What criteria will the Department use to determine how 
the $170 million in credit subsidies will be distributed among the new 
pool of section 1703 applicants?
    Answer. We are currently working to develop a methodology for 
implementing the programmatic changes and appropriations included in 
the fiscal year 2011 continuing resolution.
    Question. What is the Department's commitment to the Loan Guarantee 
program for renewable energy projects going forward?
    Answer. The Department is committed to the Loan Guarantee program 
which aims to accelerate the domestic commercial deployment of 
innovative and advanced clean-energy technologies at scale. Under the 
1705 program, DOE has issued loan guarantees for 28 projects 
representing more than $16 billion in loan guarantees for projects that 
will create more than 16,000 direct jobs.

                          WATER POWER PROGRAM

    Question. Secretary Chu, I like what you have said about hydropower 
being an ``incredible opportunity'', our ``lowest cost, clean energy 
option'' and your comments about adding this resource to our clean-
energy portfolio. And as you know, marine and hydrokinetic power is a 
promising source of renewable energy.
    Despite your positive comments, you are yet again proposing to cut 
the Water Power program, as you have every year. In fact, it is only 1 
of 2 programs to be cut in Energy Efficiency and Renewable Energy 
(EERE), which received an increase of $1.4 billion more than fiscal 
year 2011 enacted levels. I do understand that we are facing tough 
budget times, but I fail to understand the logic behind your cut of 20 
percent to the Water Power program when you have increased the budget 
for wind, solar and geothermal.
    Why isn't the Water Power program more of a priority for the 
Department?
    Answer. The Department remains optimistic about the opportunities 
to further develop the full range of water power technologies, 
including emerging marine and hydrokinetic (MHK) energy technologies. 
Given the current state of MHK development, we believe that the $38.5 
million requested for water power research in fiscal year 2012 is 
sufficient to continue the program's ongoing efforts to advance these 
water power technologies and accelerate their greater market adoption. 
We are currently completing a comprehensive set of resource 
assessments, and undertaking detailed techno-economic assessments of 
emerging technologies, which will help us to effectively determine the 
opportunities and costs associated with these technologies. These 
important analyses will help the Department determine what funding 
levels are necessary and appropriate to realize water power's 
potential.
    Regarding hydropower--as you know, hydropower accounts for about 7 
percent of our Nation's total electricity generation. And you and I 
have both applauded a recent National Hydropower Association study 
showing the potential to double existing hydro capacity and create 1.4 
million jobs. There's a lot going on in hydro--from low-impact hydro to 
small projects to increasing efficiency and output at existing 
projects. And while hydro is a more mature technology than some others, 
developing technology innovations is still important. As you know, we 
continuously work to develop innovations in other resources--from 
automobiles to other renewable energy resources like wind--and I 
believe we should be doing so with hydro as well.
    Question. Would you agree that doubling our hydro capacity is 
doable, and necessary? What is your plan to make this happen?
    Answer. DOE agrees that substantial increases in hydropower 
capacity, including pumped storage, from a baseline of about 100 GW in 
2009 are feasible by 2050. New hydropower development is possible 
across several different resource types, including:
  --capacity upgrades and efficiency improvements at existing 
        hydropower facilities;
  --adding power plants at existing, nonpowered dams;
  --installing new hydropower power capacity on constructed waterways; 
        and
  --new environmentally sustainable hydropower at natural streams.
    As most of the traditional concerns over environmental impacts 
typically associated with hydropower generation can be effectively 
mitigated through technology improvements and sustainable development 
practices, these opportunities present a low-cost, renewable energy 
resource that can help meet the administration's clean-energy economy 
goals.
    The Department has a multi-pronged approach to assist industry in 
increasing hydropower capacity. We are currently completing a set of 
resource assessments, undertaking detailed techno-economic assessments 
of existing hydropower plants, and engaging in research, development, 
and deployment of emerging technologies. The Department announced a 
Conventional Hydropower Funding Opportunity in 2011 that will help spur 
the development of conventional hydropower including pumped storage 
hydropower. Current Department-funded projects such as the Hydropower 
Advancement Project and water use optimization project will help the 
hydropower industry implement best practices to increase power 
production and assess their plants for capacity and efficiency 
upgrades. The Department has also funded an innovative ``fish-
friendly'' turbine project, a turbine design that allows fish to safely 
pass through the hydropower turbine. This will allow industry to 
install hydropower units at locations where water is otherwise spilled 
to allow for fish passage.
    Question. Regarding ocean and tidal energy, I believe you are aware 
that my home State of Washington has made a strategic decision to be an 
international leader in the commercialization of the emerging ocean 
renewable energy industry. As you know, the United States has 
significant ocean, marine, and tidal energy resources. Development of 
the technologies to capture these ocean energy resources can play a 
significant role in our Nation's economic recovery and expand our 
renewable energy portfolio.
    I strongly support the efforts underway in Washington and am proud 
of the work being done in my State to capture the jobs that will be 
created by the design, construction, and deployment of wave energy 
converters. For example, the University of Washington and Snohomish 
Public Utility District are working hard to support this new domestic 
clean electricity generation industry that has the potential to provide 
up to 10 percent of our Nation's power needs.
    Unfortunately, the United States is falling behind in the race to 
capture the rich energy potential of our oceans, and the jobs that will 
come with this new industry. Many countries, particularly in Europe, 
have already deployed viable, operating, electricity generating 
projects using the emission-free power of ocean waves, currents, and 
tidal forces. The Ocean Renewable Energy Coalition calculates that more 
than $370 million US has been spent by the UK Government on wave energy 
research and development (R&D) over the past several years. That total 
approaches $500 to $600 million US over the same period if you add in 
commitments to ocean energy R&D from France, Portugal, Spain, Norway, 
and Denmark.
    Given this competitive situation, I am particularly disappointed 
with the fiscal year 2012 budget request for the Water Power program
    While the Congress has provided increased funding for the Water 
Power program, I'm disappointed that the Department hasn't been more 
aggressive in its efforts to help commercialize this technology. We 
need the enthusiastic support of you and your senior leadership team to 
help speed the deployment of ocean energy technologies and secure U.S. 
leadership in this emerging clean-energy industry.
    What is your plan to stop the United States from losing these jobs 
to Europe?
    Answer. DOE's Water Power program is building a comprehensive 
understanding of emerging MHK technologies and facilitating innovation 
and technology development that leverages previous advancements, 
including those made in Europe. In order to promote the development of 
a competitive MHK industry in the United States, DOE's Water Power 
program is supporting the establishment of three national test centers. 
These centers are planning to build open-water testing infrastructure, 
which will allow the developers of MHK devices to efficiently test in a 
realistic marine environment.
    DOE's Water Power program is also developing state-of-the-art 
technology design tools that simulate the behavior and performance of 
MHK devices in complex marine environments (covering tidal/ocean 
current and wave resources). These models will identify key cost-of-
electricity drivers, facilitate rapid design optimization, and support 
detailed techno-economic assessment of MHK technologies as is required 
per congressional direction. Ultimately, the analytical results 
provided by these design tools will guide the Department's future 
investment decisions by identifying not only technology leaders but 
also the best opportunities to make these technologies cost competitive 
with other energy portfolio options.
    The program recently funded three full-scale MHK demonstration 
projects, including a $10 million grant to the Snohomish Public Utility 
District tidal energy project. In funding these advanced projects, the 
program seeks to demonstrate successful MHK operation and testing in 
U.S. waters and drive the development of future projects.
    Finally, the program is strategically working to remove barriers to 
deployment by engaging in research that answers questions regarding the 
potential environmental impacts of MHK technologies and by developing 
technologies to monitor and mitigate these potential impacts. 
Collectively, these efforts are strategically aimed at advancing a 
domestic MHK industry that can contribute to our Nation's clean-energy 
future.
    Given the early stage of MHK development, the Department is taking 
a very deliberate and comprehensive approach to our investments in MHK 
technologies. Future investments (Federal and private sector) will spur 
economic development only if the technologies can be proven to be 
competitive in the market place. Our efforts to spur such economic 
development are focused therefore on proving marketplace 
competitiveness of the technologies, and ultimately supporting the 
development of a competitive U.S.-based MHK industry that will create 
green jobs in the United States.
    Question. I am concerned that your budget request does not support 
development of a testing infrastructure in the United States, something 
that is vital to ensure this industry can move forward. For example, 
Europe currently has several wave and tidal energy test facilities, 
including its main facility in Scotland. We clearly have a need for 
this infrastructure here in the United States, and I know that the 
Northwest National Marine Renewable Energy Center (NMREC) has a strong 
desire to compete for funding to establish a testing center in the 
Pacific Northwest.
    Can you please comment on why your budget request does not support 
development of such testing infrastructure and can you tell me your 
plan to build it?
    Answer. The development of an MHK technology testing infrastructure 
in the United States is considered vital to helping ensure that the 
industry can continue to progress toward commercialization. To advance 
the MHK industry, the Department continues to invest in, and support, 
three NMRECs. The Northwest NMREC, the Hawaii NMREC, and the Southeast 
NMREC are important partners in the ongoing development of a viable MHK 
industry in the United States.
    The Department is currently undertaking quantitative assessments of 
the energy that can be extracted from wave, tidal and ocean current, 
and ocean thermal energy resources, and is preparing a comprehensive 
techno-economic assessment of MHK technologies and resources. This 
information will serve to identify the potential contribution that MHK 
resources can provide to our Nation's energy mix, and will also point 
to promising technologies that merit further investment. This 
information will inform the Department's future investment decisions, 
including testing facilities.

                  HYDROGEN AND FUEL CELL TECHNOLOGIES

    Question. I understand that the primary goal of the DOE Fuel Cell 
Technologies program is to advance fuel cells, including those that 
provide backup power, to be competitive in the marketplace. The market 
transformation program has been successful in meeting this goal by 
introducing fuel cells to larger markets and competing effectively in 
terms of life-cycle costs, performance, durability, reliability, and 
significantly reduced greenhouse gas emissions.
    Given the program's success, why does your budget request zero out 
the market transformation program, right when it's gaining traction?
    Answer. The Department's strategy is to sustain a balanced R&D 
portfolio, with an emphasis on nearer-term priorities, such as 
batteries, advanced vehicle technologies, and technologies for 
renewable power and energy efficiency. Fuel cell electric vehicles 
(FCEVs) are still part of the portfolio of options under development. 
In fact, DOE's increased funding for battery R&D will also be 
beneficial for FCEVs which rely on batteries in addition to fuel cells.
    The Department will continue its critical efforts in hydrogen and 
fuel cell R&D, which have already reduced the cost of fuel cells by 
more than 30 percent since 2008 and 80 percent since 2002.\1\ In fact, 
DOE's hydrogen and fuel cell program has been extremely successful, 
resulting in approximately 200 patents, 30 products being put on the 
market, and industry currently pursuing development of more than 50 
emerging technologies.\2\ The fiscal year 2012 budget sustains DOE's 
core R&D efforts which will continue to advance the technologies and 
improve the likelihood of a successful rollout by automobile 
manufacturers in the coming years.
---------------------------------------------------------------------------
    \1\ http://hydrogen.energy.gov/pdfs/10004_fuel_cell_cost.pdf.
    \2\ http://www1.eere.energy.gov/hydrogenandfuelcells/pdfs/
pathways.pdf.
---------------------------------------------------------------------------
                    SOLAR ENERGY TECHNOLOGY PROGRAM

    Question. Secretary Chu, your fiscal year 2012 budget request for 
the Solar Energy Technology program represents an increase of nearly 50 
percent more than the fiscal year 2011 budget request, and an increase 
of 87 percent more than the fiscal year 2010 enacted level. However, 
your budget request includes only $50 million for the Concentrated 
Solar Power (CSP) program, and as I understand it, you are proposing an 
approximately 8 to 1 ratio of funding in favor of Photovoltaics (PV) 
over CSP.
    Given that the United States still co-leads both technologically 
and commercially in the CSP field, do you believe that the Department 
should maintain a more balanced funding ratio between PV and CSP?
    Answer. The administration's 2011 budget request for CSP included 
$50 million for a Solar Demonstration Zone which would help validate 
cutting-edge CSP and other concentrating solar technologies. This was 
in addition to a base CSP R&D program of approximately $50 million. The 
administration did not seek additional funding for the Solar 
Demonstration Zone project in 2012 as it is unlikely that these funds 
could be fully utilized in 2012 if funds were also provided through the 
2011 budget. The request for base CSP R&D for 2012 is consistent with 
the request in 2011. As part of the 2012 budget request, the 
administration also announced its SunShot initiative which seeks to 
reduce the cost of electricity from solar technologies by 75 percent by 
the end of the decade to be competitive with conventional generation 
sources of electricity without subsidy. The administration believes 
this is an ambitious but achievable goal. For 2012, the 
administration's funding request for the SunShot initiative has been 
largely designated through the Photovoltaic Research and Development 
subprogram. We believe, however, that CSP technologies also have the 
potential to reach the SunShot Initiative goals and are assessing this 
potential as part of our future portfolio balance.

   ADVANCED CABLE AND CONDUCTORS PROGRAM (FORMERLY HIGH TEMPERATURE 
                        SUPERCONDUCTING PROGRAM)

    Question. Mr. Secretary, your budget request proposes to zero out 
the High Temperature Superconducting program (recently renamed the 
Advanced Cable and Conductors program). I understand that your 
justification is that the program has met its technical milestones. 
However, as you may be aware, other countries--namely China, Japan, and 
Korea--are aggressively demonstrating and deploying high-temperature 
superconducting systems and the United States is not.
    Given this, I believe it doesn't make sense for the Department to 
eliminate this program prior to the demonstration and deployment of 
high-temperature superconducting (HTS) systems, including advanced 
cryogenic and cryocooler systems.
    Do you agree?
    Answer. HTS is an integral part of Smart Grid technologies that can 
provide for a more reliable, secured and efficient electricity delivery 
infrastructure. After investing more than $600 million over the past 20 
years, second-generation HTS wires in sufficient lengths with good 
performance can now be produced by U.S. manufacturers. These wires are 
beginning to be sold around the world, and are the primary components 
in many international demonstration projects.
    With the availability of these commercial wires, the Department's 
Office of Electricity Delivery and Energy Reliability (OE) believes 
that HTS wire research has reached a point that second-generation HTS 
wire technology can be successfully transitioned to the U.S. 
manufacturing base. While OE is winding down its involvement in HTS 
wire research, it continues to support several innovative HTS system 
demonstration projects funded through the American Recovery and 
Reinvestment Act. These power systems include a grid-scale HTS fault 
current limiter, HTS power cable, and HTS fault current limiting 
transformer.
    In addition, DOE's Advanced Research Projects Agency-Energy (ARPA-
E) is supporting a project to develop an advanced HTS superconducting 
magnetic energy storage system that will store significantly more 
energy than current designs at a fraction of the cost. Moreover, I am 
aware of HTS system demonstration projects that are being performed by 
other agencies. For example, the Department of Homeland Security is 
investigating the feasibility of a HTS fault current limiting power 
cable that can enable connectivity between electrical substations to 
share power in case of emergencies. And at the Department of Defense, 
the Navy is developing innovative HTS applications and advanced 
cryogenic systems for military usage.
    To summarize, while OE is winding down its second-generation HTS 
wire research activities, DOE and other agencies are continuing to 
support the development and deployment of innovative HTS system 
applications. By studying the fundamental science of superconductivity, 
engaging in HTS systems development, and keeping up-to-date on 
worldwide progress in HTS wires and systems research, DOE will be in a 
position to take advantage of any significant HTS discovery and 
innovation.
    Question. If the United States eliminates programs that will 
encourage the demonstration and deployment of high-temperature 
superconducting technologies, I am seriously concerned that this will 
be another example of our Nation inventing and developing a promising 
advanced energy technology, only to lose commercial leadership to other 
countries, as happened with wind turbines and photovoltaic systems.
    Given your focus, and the President's focus, on innovation, can you 
please tell me your plan to ensure this situation does not happen with 
high-temperature superconducting technologies?
    Answer. Superconductivity is a crosscutting technology that can 
benefit energy applications in many fields of use. For the past 20 
years, the Department has focused its wires research and applications 
development activities in power delivery systems. With the Department's 
support, second-generation HTS wires manufactured in the United States 
are now available commercially and prototype HTS power systems have 
been demonstrated.
    To maintain U.S. leadership in superconductivity, however, 
fundamental understanding of HTS needs to be obtained and more novel 
superconductors need to be discovered. In addition, HTS applications 
other than power delivery systems should be developed to broaden the 
market and sustain the U.S. manufacturing base. Moreover, a more 
strategic approach to developing advanced HTS materials and conductors 
and means to integrate them into a nonsuperconducting Smart Grid 
infrastructure need to be established.
    In the area of basic superconductivity research, DOE's Office of 
Science Energy Frontier Research Center for Emergent Superconductivity 
is performing work to discover new superconductors. Furthermore, the 
Office of Science supports basic research on synthesis, advanced 
characterization, and theory to understand fundamental phenomena 
related to superconductivity. To broaden the HTS market, a number of 
DOE offices are considering the benefits of various applications 
ranging from light weight superconducting generator for offshore wind 
turbines to very high field superconducting magnet systems suitable for 
scientific and medical applications. Moreover, the fiscal year 2012 
request for the Office of Electricity Delivery and Energy Reliability 
includes a Smart Grid Technology and Systems Hub, which can leverage 
crosscutting technologies and capabilities developed under the 
superconductivity program to impact this and other energy applications.
    The Department believes that the United States will maintain its 
leadership position in superconductivity by fully implementing the plan 
to understand and discover novel superconductors, demonstrate 
innovative and diverse HTS applications to broaden the market base, and 
develop advanced materials and systems that will integrate seamlessly 
into a reliable, secured, and efficient Smart Grid infrastructure.

                      CLEAN RENEWABLE ENERGY BONDS

    Question. Secretary Chu, the fiscal year 2012 budget request 
proposes another 1-year extension of the 1603 Treasury grant program to 
incentivize renewable energy. As you know, 1603 only applies to private 
developers and utilities; it is not available to consumer-owned 
utilities like many of those in Washington State. The Clean Renewable 
Energy Bond (CREBs) program is available to those municipal and rural 
cooperative utilities to incentivize renewable resources.
    Given that increasing the CREBs bonding level would help the 
administration achieve its 80 percent clean-energy goal, would the 
administration support an increase in the CREBs program?
    Answer. The administration recognizes the instrumental role that 
CREBs have played in catalyzing investment in renewable energy by 
nontaxable entities as a complement to other incentives such as Federal 
tax credits. Raising the cap on CREBs is one among several policy 
measures that can encourage investment in renewable energy, which is 
consistent with administration policy objectives for a clean-energy 
economy.
                                 ______
                                 
               Questions Submitted by Senator Tim Johnson

    Question. I appreciate the administration's commitment to the 
research and development necessary to advance renewable energy. 
Cellulosic biomass has a promising future for both transportation fuel 
and power production, and it is important that we understand how much 
biomass can be produced sustainably and economically for bioenergy. To 
this end, the Department of Energy (DOE) has supported the development 
of the Regional Feedstock Partnership, a collaborative effort of 
Federal agencies, national laboratories, and universities that is now 
into its third and fourth year of field work.
    The DOE budget justification suggests that the United States 
Department of Agriculture (USDA) will take a lead in sustainable 
feedstock production beginning in fiscal year 2012. That may be a 
reasonable approach; however, I have several questions regarding the 
impacts to the Regional Feedstock Partnership and ongoing research 
within DOE Office of Biomass programs.
    My understanding is that the development of the Regional Feedstock 
Partnership was reviewed and approved by the Office of Management and 
Budget. The program has enjoyed bipartisan support and has been 
included in the administration budget requests for the last several 
years. In fiscal year 2012, however, the administration proposed to 
greatly reduce the Sustainable Feedstocks funding account that supports 
the Partnership.
    Is the reason for reducing the Sustainable Feedstocks account due 
to the intent to shift the lead on biomass feedstocks to USDA?
    Answer. On February 3, 2010, The White House issued Growing 
America's Fuels: An Innovative Approach to Achieving the President's 
Biofuels Target.\3\ This document established lead agency 
responsibility for each biofuel area supply chain segment. USDA was 
identified as the lead for both Feedstock Development and Feedstock 
Production Systems, and was directed to coordinate with DOE to enhance 
the work being conducted by the Regional Feedstock Partnership. In an 
effort to help align feedstock activities with each agency's expertise 
and minimize redundant focus areas, the emphasis for DOE feedstock-
related funding was shifted to focus primarily on feedstock logistics 
systems in the fiscal year 2012 budget request.
---------------------------------------------------------------------------
    \3\ Available at http://www.whitehouse.gov/sites/default/files/
rss_viewer/growing_americas_ fuels.PDF.
---------------------------------------------------------------------------
    Question. From your point of view, has the DOE Regional Feedstock 
Partnership been a success?
    Answer. The DOE Regional Feedstock Partnership has successfully 
established more than 100 biomass energy crop field trials in 39 States 
through the work of more than 96 university, USDA Agricultural Research 
Service, and industry scientists. DOE considers the information 
collected from the field trials to date, as well as the extensive 
relationships that have been established under the Partnership, to be 
highly valuable to the Nation's biomass feedstock production efforts. 
The March 2011 progress report ``Regional Biomass Feedstock Partnership 
Executive Summary'' details other Partnership successes to date.\4\
---------------------------------------------------------------------------
    \4\ Progress report available at http://www.sungrant.org/NR/
rdonlyres/F374DEB6-810C-4B05-9A21-2 6D6B0576E78/2834/
ExecutiveSummary33111.pdf.
---------------------------------------------------------------------------
    Question. After funding the Partnership for several years, is it an 
effective use of taxpayer dollars to terminate the program just as the 
field research results are beginning to come in?
    Answer. DOE plans to support the Regional Feedstock Partnership 
through fiscal year 2013. It was the original intention of DOE to 
support the Regional Feedstock Partnership for at least 6 years (fiscal 
years 2008-2013) in recognition of the need for longer-term studies 
associated with perennial biomass energy crops. These systems often 
take multiple years to establish, and the full potential of their 
productivity, as well as potential environmental services provided by 
perennial systems, cannot always be realized within just a few years. 
Conversely, field trials for annual biomass energy crops and residues, 
such as energy sorghum or corn stover, have provided valuable data from 
the first year they were established.
    Question. Would it not make more sense to complete the program for 
at least the remaining 2 years of this OMB-approved process, in order 
to get the benefit of the work that has already been done rather than 
start over and duplicate these efforts through another Department?
    Answer. USDA has been designated lead agency under Growing 
America's Fuels: An Innovative Approach to Achieving the President's 
Biofuels Target for Feedstock Development and Feedstock Production 
Systems. The difficult aspects of establishing this type of research 
program have already been addressed, including:
  --development of a nationwide network of more than 90 scientists to 
        participate in the Partnership;
  --development of comparable field management and data collection 
        protocols for nine different biomass energy feedstocks across 
        five different geographical regions; and
  --establishment of difficult and costly perennial energy-cropping 
        systems.
    These successes will be leveraged by USDA as it takes the lead on 
feedstock development and production systems.
                                 ______
                                 
           Questions Submitted by Senator Frank R. Lautenberg

    Question. The United States leads the world in fuel cell patents. 
Fuel cells can help reduce our dependence on oil and air pollution 
while at the same time creating jobs. In New Jersey, companies like 
BASF employ hundreds in their fuel cell divisions. How will the 
reductions in funding for fuel cell technology in this budget affect 
our ability to win the clean-energy race?
    Answer. The Department's strategy is to sustain a balanced research 
and development (R&D) portfolio, with an emphasis on nearer-term 
priorities, such as batteries, advanced vehicle technologies, and 
technologies for renewable power and energy efficiency. Fuel cell 
electric vehicles (FCEVs) are still part of the portfolio of options 
under development. In fact, the Department of Energy's (DOE) increased 
funding for battery R&D will also be beneficial for FCEVs which rely on 
batteries in addition to fuel cells.
    The Department will continue its critical efforts in hydrogen and 
fuel cell R&D, which have already reduced the cost of fuel cells by 
more than 30 percent since 2008 and 80 percent since 2002.\5\ In fact, 
DOE's hydrogen and fuel cell program has been extremely successful, 
resulting in approximately 200 patents, 30 products being put on the 
market, and industry currently pursuing development of more than 50 
emerging technologies.\6\ The fiscal year 2012 budget sustains DOE's 
core R&D efforts which will continue to advance the technologies and 
improve the likelihood of a successful rollout by automobile 
manufacturers in the coming years.
---------------------------------------------------------------------------
    \5\ http://hydrogen.energy.gov/pdfs/10004_fuel_cell_cost.pdf.
    \6\ http://www1.eere.energy.gov/hydrogenandfuelcells/pdfs/ 
pathways.pdf.
---------------------------------------------------------------------------
    Question. In response to high gas prices, some have suggested we 
need more offshore drilling with fewer safeguards. The Energy 
Information Administration found that opening all of the offshore areas 
in the lower 48 States would lower gas prices by just 3 cents per 
gallon--decades from now. How will the President's budget invest in 
real solutions to high gas prices?
    Answer. Even while committed to safe and responsible domestic oil 
and gas production, the administration has taken steps to improve 
efficiency across the entire transportation sector and to develop and 
expand alternative fuels, including advanced biofuels. Energy 
innovation will increase the potential for the replacement of 
petroleum. Therefore, the administration's budget provides increases 
for programs, such as the Advanced Research Projects Agency-Energy 
(ARPA-E), that support energy innovation. The budget helps advance the 
goal of 1 million electric vehicles on the road by 2015 including 
through a shift from the existing tax credit incentive to a rebate that 
would be available to consumers at the point of sale and a $588 million 
investment in research, development and deployment programs for 
advanced vehicle technologies. It also proposes $341 million for 
biofuels and biomass R&D within the Office of Energy Efficiency and 
Renewable Energy, including a new reverse auction to promote advanced 
biofuels across the country.
    Question. The Princeton Plasma Physics Laboratory in New Jersey 
carries out research that could lead to major innovations in energy 
technology and help make the United States a world leader in clean-
energy technology. One area of research is developing energy from 
fusion. A breakthrough in fusion energy could be the solution to the 
world's energy problems by providing the planet with a safe, clean, and 
limitless supply of energy.
    I support a significant increase in funding for the Plasma Physics 
Lab. Would an increase in funding help accelerate progress toward game-
changing clean-energy breakthroughs?
    Answer. DOE believes that the funding levels proposed for the 
Princeton Plasma Physics Laboratory are appropriate and in balance with 
other priorities within DOE and throughout the Federal Government.
                                 ______
                                 
               Questions Submitted by Senator Tom Harkin

                                BIOFUELS

    Question. Secretary Chu, as you know, biofuels are a remarkable 
success. They displace close to 10 percent of our gasoline demand. 
While we can and should also be promoting other oil displacement 
alternatives, such as electric vehicles, continued expansion of 
biofuels seems to be the best option we have for displacing another 10 
percent of our gasoline demand. The Congress recognized that in passing 
the renewable fuel standard (RFS) in the 2007 Energy bill.
    Biofuels also face a major marketplace problem. Most biofuel usage 
today is in the form of E10, a 10 percent blend of ethanol with 
gasoline. As we continue to expand the contribution from biofuels, we 
need to remember that a large share of that will continue to be in the 
form of ethanol. Thus, we need to be able to use higher ethanol blends. 
We need filling stations that offer higher blends, and we need vehicles 
that can use those higher blends.
    What is the Department of Energy (DOE) doing to promote the 
availability and use of higher blends of ethanol, beyond E10 and E15? 
What more could the Department do, and what support from the Congress 
would be most useful to that end?
    Answer. In addition to sponsoring the E15 and E20 test program, 
DOE's Office of Energy Efficiency and Renewable Energy (EERE) supports 
several activities to promote higher ethanol blend usage. Specifically, 
the Energy Policy Act of 1992 requires that Federal, State, and utility 
fleets acquire alternative fuel vehicles (AFV) annually at determined 
percentages. These vehicles largely include flex-fuel vehicles that are 
capable of operating on E85 fuel. EERE's Vehicle Technologies Program 
(VTP) and Federal Energy Management program manage and monitor AFV 
acquisitions and alternative fuel usage in those fleets. Additionally, 
VTP and the Biomass Program are sponsoring fuel dispensing research 
with Original Equipment Manufacturers and Underwriter's Laboratory to 
develop and list E15 dispenser retrofit kits that can be installed in 
retail stations throughout the country. Through the State Energy 
program and the Energy Efficiency and Conservation Block Grant program, 
EERE has encouraged recipients to use money for installing renewable 
energy infrastructure. Last, DOE is actively working with Federal 
agencies to install alternative fuel pumps at fueling stations, in 
accordance with Energy Independence and Security Act of 2007 
requirements. DOE also supports ongoing research to ensure that fuel 
dispensed by blender pumps meets American Society for Testing and 
Materials (ASTM) specifications.
    Question. One program that could help expand markets for higher 
ethanol blends is the Clean Cities program. How much funding in the 
Clean Cities program will be devoted to expanding markets for E85 and 
other higher blends in fiscal year 2012, and what will that accomplish?
    Answer. The Department agrees that the Clean Cities initiative is 
an excellent way to expand alternative fuel markets. The President's 
fiscal year 2012 budget request for Vehicle Technologies Deployment 
includes $29 million for Clean Cities activities to facilitate the 
deployment of renewable and alternative fuels and advanced 
technologies, as well as the infrastructure to support their widespread 
use. Clean Cities funds would support competitively awarded vehicle 
infrastructure deployment projects, including E85 and other renewable 
biofuel vehicle projects; the funding opportunity would require a 
minimum 50 percent cost share. Clean Cities funds also would be used to 
provide technical assistance, tools, and consumer information related 
to renewable and alternative fuels and advanced technologies that 
reduce petroleum consumption. Examples include safety information 
related to renewable fuels for permitting officials and first 
responders, GPS data and mapping tools for locating renewable fuel 
stations (the current public database includes more than 3,000 sites 
for E85 and B20 biodiesel), and the Federal Fuel Economy Guide and 
FuelEconomy.gov, which include vehicle information on E85 flex-fuel 
vehicles available in the United States.
    Question. When we met with your Deputy Secretary Dan Poneman and 
with EPA Administrator Lisa Jackson last August, we learned that DOE 
was testing E20 in a fleet of autos in parallel with your testing of 
E15. What are the results of those tests, please? Would those tests 
support authorizing use of E20 in all vehicles of model year 2001 and 
newer?
    Answer. DOE is in the process of testing the final four vehicle 
models on E20 fuel. The test results are expected to be ready by 
December 2011. As you know the E15 testing was completed in December 
2010 and the waiver request was ruled upon by EPA in January 2011 
largely based on DOE data. The EPA determination allows up to E15 
blends to be used in all model year 2001 and newer vehicles. Any 
decision to allow E20 use for the same model year vehicles would have 
to be determined by EPA. DOE will continue to share the data with EPA 
as it becomes available.
    Question. We share a belief in the importance of accelerating the 
development and commercialization of advanced biofuels, and I am 
pleased that you are proposing to conduct a reverse auction for 
advanced biofuels in fiscal year 2012. I believe conducting an earlier 
reverse auction, in this fiscal year 2011, would be a good way to get 
some experience with this process for both DOE and the industry.
    Will you conduct an initial reverse auction for advanced biofuels 
in fiscal year 2011? Please tell me when the fiscal year 2012 auction 
will take place.
    Answer. The Department had originally planned to conduct an initial 
reverse auction in fiscal year 2011; however, because many of the 
companies planning to build biorefineries to produce cellulosic 
biofuels have been delayed due to economic conditions, it was decided 
to postpone the proposed auction until fiscal year 2012. It was felt 
that a larger auction would validate the concept and result in a more 
meaningful effect on the marketplace. The timing of the fiscal year 
2012 auction will depend on several factors including industry 
conditions and the budget process.

                        HYDROGEN AND FUEL CELLS

    Question. Secretary Chu, in the early 1990s, I was one of the first 
in the Congress to call for research and development (R&D) of hydrogen 
and fuel cell technologies in the DOE's energy programs. I was pleased 
when these technologies were given legitimate program status in the 
DOE's energy R&D portfolio along with reasonable funding within that 
portfolio. I'm told that this program has been quite successful in 
meeting its goals and milestones. However, your budget proposal for 
fiscal year 2012 proposes a very significant cut to this program area.
    Why are you proposing to cut the hydrogen and fuel cells program 
budget by 41 percent in fiscal year 2012 in the context of a proposal 
for an overall budget increase of 46 percent across all of the EERE 
programs?
    Answer. The Department of Energy's (DOE) strategy is to sustain a 
balanced R&D portfolio, with an emphasis on nearer-term priorities, 
such as batteries, advanced vehicle technologies, and technologies for 
renewable power and energy efficiency. Fuel cell electric vehicles 
(FCEVs) are still part of the portfolio of options under development. 
In fact, DOE's increased funding for battery R&D will also be 
beneficial for FCEVs which rely on batteries in addition to fuel cells.
    The Department will continue its critical efforts in hydrogen and 
fuel cell R&D, which have already reduced the cost of fuel cells by 
more than 30 percent since 2008 and 80 percent since 2002.\7\ In fact, 
DOE's hydrogen and fuel cell program has been extremely successful, 
resulting in approximately 200 patents, 30 products being put on the 
market, and industry currently pursuing development of more than 50 
emerging technologies.\8\ The fiscal year 2012 budget sustains DOE's 
core R&D efforts which will continue to advance the technologies and 
improve the likelihood of a successful rollout by automobile 
manufacturers in the coming years.
---------------------------------------------------------------------------
    \7\ http://hydrogen.energy.gov/pdfs/10004_fuel _cell_cost.pdf.
    \8\ http://www1.eere.energy.gov/hydrogenandfuelcells/pdfs/ 
pathways.pdf.
---------------------------------------------------------------------------
                            DISTRIBUTED WIND

    Question. Secretary Chu, we're all aware of the benefits of large-
scale wind projects in the United States, and I'm especially proud of 
the leadership role Iowa is playing in windpower manufacturing and 
power generation. However, there also is great potential for smaller-
scale ``distributed wind'' projects. In fact, smaller wind turbine 
systems can often result in outsized benefits to rural communities, 
farmers, ranchers and other citizens. Small wind systems also offer a 
domestic manufacturing development opportunity given that 95 percent of 
the small wind systems installed in the United States in 2009 were 
manufactured domestically. Moreover, much of that manufacturing 
activity is occurring in economically challenged rural areas.
    In fiscal year 2010, DOE spent approximately $80 million on 
research, development, and demonstration (RD&D) for wind energy, but 
only about 2 percent of that total, about $1.6 million was for small- 
and medium-sized wind.
    Given the significant contributions that distributed wind can make 
to our rural economy and our clean-energy future, do you think that the 
Department ought to place more emphasis on this important renewable 
energy technology?
    Answer. In fiscal year 2010, roughly $5.9 million, approximately 
7.4 percent, of the total DOE budget for wind energy RD&D went to 
distributed wind energy technology, including small (greater than 1 
kilowatt and less than or equal to 100 kilowatts) and midsize (greater 
than 100 kilowatts and less than or equal to 1 megawatt) technologies. 
While distributed wind technology remains a part of the portfolio, the 
Department has recently increased its emphasis on less mature offshore 
wind technologies, as indicated by the President's fiscal year 2012 
budget request. DOE nevertheless plans to continue to support 
activities related to product testing, standards development, and the 
establishment of an accredited third-party certification body for small 
wind turbine technology. The Department also plans to fund the 
remaining $3.2 million of a $5.1 million funding opportunity to support 
midsize turbine prototype development by the close of fiscal year 2011.
    The Department plans to consider research and development efforts 
that build on this funding opportunity to ensure that a range of 
domestically manufactured midsize turbines is commercially available. 
Other planned future program activities include risk mitigation through 
demonstration projects, testing, and standards development to support 
the development of the midsize turbine technology. The Department also 
plans research and development on high-throughput manufacturing 
techniques for wind technologies in order to remain cost-competitive in 
the export market while supporting domestic jobs.
    Question. Will you agree to take a close look at DOE's wind power 
program very soon and take steps to increase DOE's focus and support 
for distributed wind power?
    Answer. The DOE Wind and Water Power program is supporting the 
development of a distributed wind industry roadmap to be completed in 
2012. This roadmap will be a reference document to help the wind 
industry prioritize strategic activities required to overcome barriers 
hindering widespread development and deployment of distributed wind 
technology. Currently, the program supports activities related to 
product testing, standards development, and the establishment of an 
accredited third-party certification body for small wind turbine 
technology. The program also plans to fund the remaining $3.2 million 
of a $5.1 million funding opportunity to support midsize turbine 
prototype development by the close of fiscal year 2011.
    The Department plans to consider research and development efforts 
that build on this funding opportunity to ensure that a range of 
domestically manufactured midsize turbines is commercially available. 
Other planned future program activities include risk mitigation through 
demonstration projects, testing, and standards development to support 
the development of the midsize turbine technology. The Department also 
plans R&D on high-throughput manufacturing techniques for wind 
technologies in order to remain cost-competitive in the export market 
while supporting domestic jobs.
                                 ______
                                 
               Questions Submitted by Senator Jon Tester

                               FUEL CELLS

    Question. Fuel cells are manufactured in America from American raw 
materials, and produce clean energy that uses American resources 
efficiently. Montana is home to the only platinum mine in the country, 
which provides the catalysts for stationary and vehicle fuel cells. 
Montana also has the largest recoverable coal reserves in the United 
States and though fuel cells are viable now, they also offer a 
potential future for coal, as they are the most efficient way to use 
any fuel, including fossil fuels. I feel very good about the progress 
fuel cell manufacturers have made and will continue to make in reducing 
the amount of platinum used in these catalysts, to bend down the cost 
curve.
    The industry believes that the best way to continue those 
reductions is through commercialization, but that your fuel cell and 
hydrogen budget misplaces priorities with an over-emphasis on research 
and development R&D, while eliminating commercialization support for 
solid oxide fuel cells and fuel cell forklifts, just as they are 
beginning to achieve market success. Is the industry wrong?
    Answer. The Department's strategy is to sustain a balanced (R&D) 
portfolio, with an emphasis on nearer-term priorities, such as 
batteries, advanced vehicle technologies, and technologies for 
renewable power and energy efficiency. Fuel cell electric vehicles 
(FCEVs) are still part of the portfolio of options under development. 
In fact, DOE's increased funding for battery R&D will also be 
beneficial for FCEVs which rely on batteries in addition to fuel cells.
    The Department will continue its critical efforts in hydrogen and 
fuel cell R&D, which have already reduced the cost of fuel cells by 
more than 30 percent since 2008 and 80 percent since 2002.\9\ In fact, 
the Department of Energy's (DOE) hydrogen and fuel cell program has 
been extremely successful, resulting in approximately 200 patents, 30 
products being put on the market, and industry currently pursuing 
development of more than 50 emerging technologies.\10\ The fiscal year 
2012 budget sustains DOE's core R&D efforts which will continue to 
advance the technologies and improve the likelihood of a successful 
rollout by automobile manufacturers in the coming years.
---------------------------------------------------------------------------
    \9\ http://hydrogen.energy.gov/pdfs/10004_fuel _cell_cost.pdf.
    \10\ http://www1.eere.energy.gov/hydrogenandfuelcells/ pdfs/
pathways.pdf.
---------------------------------------------------------------------------
    Question. Both fuel cell and hydrogen researchers and the industry 
believe that if your fiscal year 2012 budget is enacted, its structure 
and dollar amount will cause the United States to lose its competitive 
edge in fuel cells for stationary power and transportation 
applications. Is the industry wrong? If not, are you comfortable losing 
this industry to Germany, Japan, South Korea, China, and South Africa?
    Answer. To the contrary, the Department's basic R&D work is 
absolutely essential to ensuring American automakers have the best 
technology available to be competitive in the global marketplace.

                            DISTRIBUTED WIND

    Question. Secretary Chu, while we're all aware of the myriad 
benefits of large, industrial-scale wind projects in the United States, 
there is great potential for smaller-scale ``distributed wind'' 
projects as well. In Montana, we have second-best wind potential in the 
United States. In fact, smaller wind turbines or projects can often 
result in outsized benefits to rural communities, farmers, ranchers and 
other citizens. And buy-in for smaller wind translates into social 
acceptance of larger-scale projects.
    It can also help to reinvigorate our Nation's manufacturing base 
given that 95 percent of the small wind systems installed in the United 
States in 2009 was manufactured domestically and much of that 
manufacturing activity occurred in economically challenged rural areas.
    In fiscal year 2010, DOE spent approximately $80 million on 
research, development and demonstration (RD&D) for wind energy, but 
only about 2 percent of that total, about $1.6 million was for small- 
and medium-sized wind. By contrast, your agency spent roughly $250 
million on solar RD&D in that same time period.
    Given the significant contributions that distributed wind can make 
to our rural economy and our clean-energy future; do you think that the 
Department ought to place more emphasis on this important renewable 
energy technology?
    Answer. In fiscal year 2010, roughly $5.9 million, approximately 
7.4 percent, of the total DOE budget for wind energy RD&D went to 
distributed wind energy technology, including small (greater than 1 
kilowatt and less than or equal to 100 kilowatts) and midsize (greater 
than 100 kilowatts and less than or equal to 1 megawatt) technologies. 
While distributed wind technology remains a priority for DOE, the 
Department has recently increased its emphasis on less mature offshore 
wind technologies, as indicated by the President's fiscal year 2012 
budget request. DOE nevertheless plans to continue to support 
activities related to product testing, standards development, and the 
establishment of an accredited third-party certification body for small 
wind turbine technology. The Department also plans to award the 
remaining $3.2 million of a $5.1 million funding opportunity to support 
midsize turbine prototype development by the close of fiscal year 2011.
    The Department plans to consider research and development efforts 
that build on this funding opportunity to ensure that a range of 
domestically manufactured midsize turbines is commercially available. 
Other planned future program activities include risk mitigation through 
demonstration projects, testing, and standards development to support 
the development of the midsize turbine technology. The Department also 
plans research and development on high-throughput manufacturing 
techniques for distributed wind technologies in order to remain cost-
competitive in the export market while supporting domestic jobs.
    Question. Will you agree to take a close look at DOE's wind power 
program very soon and assess steps to increase focus and support for 
distributed wind power?
    Answer. The DOE Wind and Water Power program is supporting the 
development of a distributed wind industry roadmap to be completed in 
2012. This roadmap will be a reference document to help the wind 
industry prioritize strategic activities required to overcome barriers 
hindering widespread development and deployment of distributed wind 
technology. Currently, the program supports activities related to 
product testing, standards development, and the establishment of an 
accredited third-party certification body for small wind turbine 
technology. The program also plans to fund the remaining $3.2 million 
of a $5.1 million funding opportunity to support midsize turbine 
prototype development by the close of fiscal year 2011.

             WESTERN AREA POWER ADMINISTRATION TRANSMISSION

    Question. As you know, in February 2009 (in the American Recovery 
and Reinvestment Act [ARRA]), the Congress provided Western Area Power 
Administration (WAPA) with ample and broad borrowing authority to plan, 
finance, build, study, and operate new and upgraded electric power 
transmission lines that deliver or facilitate the delivery of power 
generated by new renewable energy resources. Last year in this same 
hearing, we discussed how little of that $3.25 billion in borrowing 
authority had been exercised. Unfortunately, nothing has changed and 
still less than 5 percent of that money is obligated.
    The legislation is pretty clear. The Administrator of WAPA is 
supposed to use that borrowing authority to go forth and build. That's 
not completely autonomous authority, but the Congress intended WAPA to 
be fairly independent when using it. WAPA can't run a program like the 
Congress intended if they have to renegotiate each deal with each level 
of DOE then Office of Management and Budget (OMB). The developers will 
lose interest and quit. That's just a recipe for inaction laid on top 
of all the other permitting challenges for new transmission and 
renewable energy projects.
    Mr. Secretary, what's going on? Could you describe the review and 
approval process for this borrowing authority and who is the 
transmission expert in charge at the Department for guiding this 
important program?
    Answer. When a project proposal is presented to WAPA, WAPA reviews 
the proposal and works with the project developer to address any 
deficiencies. Once this is complete, WAPA begins an analysis of the 
project, including an in-depth review by subject matter experts and 
independent examiners such as Deloitte Corporate Finance, LLC. The 
proposal is evaluated against the criteria specified for the 
Transmission Infrastructure Program (TIP) in a Federal Register notice 
published on May 14, 2009. Specific terms and conditions may have to be 
negotiated with the project developer in order to ensure there is 
reasonable expectation the Treasury borrowing will be repaid.
    When WAPA is satisfied the project has merit and is appropriate for 
borrowing authority funding, WAPA presents the project to the DOE and 
the Office of Management and Budget for their approval.
    In June, 2011, Secretary Chu appointed Lauren Azar as the 
Secretary's Senior Policy Advisor for Transmission. Ms. Azar is an 
expert on electric power transmission, and played a critical role in 
the Department's review and approval of TIP projects since her arrival.
    Question. Could you, Director Lew and Secretary Geithner lay down 
some simple guidance for WAPA that will let them get to work?
    Answer. Yes. In April 2009, WAPA signed a Memorandum of 
Understanding (MOU) with the Treasury Department that established the 
terms and conditions for loans made by the U.S. Treasury to WAPA 
pursuant to borrowing authority provided WAPA in ARRA (Public Law 111-
5). This MOU has been reviewed and revised periodically, and the 
arrangement is working well.
    Question. Could you tell us, for the record, how many miles of new 
transmission lines have been built thus far under WAPA TIP)?
    Answer. To date, to WAPA's TIP has funded the construction of 33 
miles of new transmission line. This construction is for the Montana-
Alberta Tie Ltd. Transmission Project.
    Question. How many miles for Bonneville Power Administration (BPA)? 
And, what has BPA done with the increase in their already massive 
borrowing authority provided by ARRA?
    Answer. BPA finances its operations with a business-type budget and 
on the basis of self-financing authority. Authority to borrow from the 
U.S. Treasury is available to BPA on a permanent, indefinite basis. The 
amount of Treasury borrowing outstanding at any time cannot exceed $7.7 
billion and must be repaid at interest rates comparable to borrowings 
at open market rates for similar issues. BPA's Treasury borrowing 
authority is used to finance projects that sustain and enhance the 
Federal Columbia River Power System, including transmission, hydropower 
modernization, fish and wildlife mitigation, and conservation. 
Transmission investments and enhancement use the greatest amount of 
U.S. Treasury borrowing.
    BPA's transmission system now includes more than 15,000 circuit 
miles of line and 263 substations. The capital financing required to 
sustain this system and meet new demands is significant. Before 
receiving the additional $3.25 billion of borrowing authority as part 
of ARRA, BPA estimated it would reach its Treasury borrowing authority 
limit between 2013 and 2016. The new increment of borrowing authority 
gave BPA the certainty of sufficient access to capital to proceed with 
new-start projects and ensured that existing capital projects could 
proceed as planned. With this financing certainty, BPA commenced 
construction work on two major network reinforcement projects and 
another two are in planning and environmental review stages. If all 
four lines are constructed, these lines will add more than 220 miles of 
lines to the Northwest transmission grid, improve reliability, and 
allow BPA to provide transmission service to about 5,853 megawatts of 
requests for BPA transmission; including 4,891 megawatts of additional 
wind integration and green energy. BPA has completed construction on a 
total of 75 transmission towers and 58 miles of transmission on the 
McNary-John Day line, the first project that was ready to begin at the 
time the ARRA was enacted.
    Additional upgrades, additions and replacements also have 
modernized the transmission grid assets, more than 50 percent of which 
were built prior to 1960.
    In addition to investments in the TIP system, BPA's Treasury 
borrowing authority is used for investments in hydro modernization, 
fish and wildlife, and energy efficiency. For example, with the 
additional access to capital, BPA was able to fund a major 
rehabilitation of the Grand Coulee Third Powerhouse that will improve 
hydro efficiency and is critical to the Federal Columbia River Power 
System (FCRPS) for power production, water management, system 
stability, and ancillary services to the main transmission grid. 
Because of increased access to capital, BPA is investing $203 million 
through 2017 in upgrades and replacements at Federal dams. Also, the 
additional borrowing authority has enabled BPA to fund three major fish 
hatchery projects and will help BPA meet its portion of the aggressive 
targets for energy efficiency in the Northwest Power Planning and 
Conservation Council's Sixth Power Plan. Conservation is the region's 
resource of choice for meeting load growth for the next 5 years and 
beyond.
    While BPA's total borrowing authority, including the new increment, 
is one single funding authority, as of this time, BPA has identified up 
to $2 billion in major capital projects attributed to ARRA through 
2017. Of this total, $583 million has been expended to date. The 
capital projects attributed to ARRA include several of the 
transmission, hydropower modernization, fish and wildlife mitigation, 
and conservation projects mentioned earlier.
    The additional $3.25 billion in borrowing authority has been 
instrumental in providing BPA with assurance that it can proceed with 
essential investment in the region's aging infrastructure and meet the 
increasing demands of its entire capital program. Without available 
borrowing authority, BPA would have to defer or reduce valuable capital 
work needed to keep the FCRPS delivering the clean, renewable 
electricity that is the backbone of the region's economy. Even with the 
ARRA providing a sizable increase in BPA's authority to borrow from the 
Treasury, the agency will continue to face capital funding challenges 
as the pace of capital spending increases to meet the infrastructure 
and energy efficiency needs of the region. BPA continues to seek 
opportunities for alternative funding sources with third parties.

 COORDINATION OF POWER MARKETING ADMINISTRATIONS AND THE DEPARTMENT OF 
                             ENERGY POLICY

    Question. The Power Marketing Administrations and Tennessee Valley 
Authority are all somewhat different animals, due to their enabling 
legislation. But, presumably, they and their Senate-confirmed board 
members are all working together with you and the administration to 
further the goals of the President--energy efficiency, renewable and 
clean energy, a more reliable and smarter grid and so on. How does all 
that work, because it's not obvious from out here that it's all hanging 
together with any specific goals in mind?
    Specifically you released a proposal to promote development of Pump 
Storage Hydro, while at the same time one of the Power Marketing 
Administrations was turning away companies interested in working with 
the Agency to develop permitted projects in their service territory.
    Where does it all get knitted together at the Department?
    Answer. DOE briefed Senator Tester's staff on this issue.
    Question. Do the heads of the PMAs meet regularly with you and your 
team?
    Answer. DOE briefed Senator Tester's staff on this issue.

                          RURAL IMPLEMENTATION

    Question. While DOE is certainly the premier Federal agency dealing 
with research, development, and demonstration for energy, many other 
agencies--the Department of Agriculture (USDA), the Department of 
Defense, the Environmental Protection Agency (EPA) and the Department 
of the Interior--also have authority and resources to support Energy 
development. Along those lines you've teamed up with USDA to work on 
the development of biofuels. That is a good first step.
    But how are you coordinating with these agencies to expand 
information about your solicitations, projects and commercialization 
opportunities, especially in rural America where they develop and 
harness this energy? How about with development of distributed 
technologies? Are you willing to commit to working with your sister 
agencies to identify opportunities to expand opportunities for 
distributed wind and other technologies?
    Answer. The Department is committed to regularly engaging with 
other agencies about program activities in order to maximize 
coordination and prevent interagency overlaps. For example, regarding 
biomass-related activities, DOE regularly coordinates through the 
Biomass Research and Development Board,\11\ which is an interagency 
collaborative composed of senior decisionmakers from Federal agencies 
and the White House--including DOE and USDA (cochairs); the Departments 
of the Interior, Transportation, and Defense, EPA; the National Science 
Foundation; and the White House Office of Science and Technology 
Policy. The Board is charged with maximizing the benefits of Federal 
programs and bringing coherence to Federal strategic planning in 
biomass research and development, including minimizing unnecessary 
duplication of activities. Several other interagency formal and 
informal collaborations function to leverage existing expertise across 
agencies with similar missions and goals, such as Memoranda of 
Understanding (MOU), regular working group meetings, joint 
solicitations, and other mechanisms. Examples of MOUs signed over the 
last 2 years include one on hydrogen with the Army Corps of Engineers 
and the Interior Department, one on off-shore wind, marine and 
hydrokinetic devices with the Interior Department, and an updated MOU 
with EPA on ENERGY STAR.
---------------------------------------------------------------------------
    \11\ The Board, as well as the Technical Advisory Committee and the 
annual solicitation, were established by the Biomass Research and 
Development Act of 2000, and later amended by section 9001 of the Food 
Conservation and Energy Act of 2008.
---------------------------------------------------------------------------
                     MECHANICAL INSULATION PROGRAM

    Question. Mr. Secretary, Montana was part of a very successful 
pilot program, the Mechanical Insulation Education and Awareness 
Campaign, which initially received $500,000 in fiscal year 2010 through 
the DOE's Industrial Technologies Program (ITP).
    Montana performed an energy assessment in partnership with DOE and 
the mechanical insulation industry. The program looked at 25 buildings 
in the capitol complex and found that installing or replacing 
mechanical insulation in those buildings would save 6 billion Btus per 
year, representing roughly 8 percent of the total natural gas 
consumption of the facilities analyzed, with an overall payback period 
of 4.1 years.
    This is such low-hanging fruit to replace damaged mechanical 
insulation puts people to work immediately and cuts our energy 
consumption.
    How to plan to expand and invest in this successful program, 
promoting it to other States and locations?
    Answer. Through the activities conducted under the Mechanical 
Insulation program, ITP has developed five calculation tools that allow 
users to find cost-effective insulation opportunities such as those 
identified in Montana and to calculate ROI and paybacks. These tools, 
once broadly distributed the summer of 2011, will carry forward the 
results of the Montana pilot program and encourage similar assessments 
in all States across the United States. In addition, the Campaign has 
developed seven online training modules that will be completed by 
September 2011 that educate industrial facilities, building owners, 
property managers, and the construction industry on how to find and 
implement energy efficiency opportunities through greater and more 
effective use of mechanical insulation. Because of these self-paced 
tools and training modules, ITP believes that thousands of users can be 
educated on the benefits of mechanical insulation at little additional 
cost to DOE and the taxpayer. Success stories will be developed on 
Mechanical Insulation and promoted on the ITP Web site and disseminated 
through organizations such as equipment suppliers, the National 
Association of State Energy Officials and the National Insulation 
Association.
    Question. How does your budget efficiently invest in more energy 
efficiency programs we can implement today?
    Answer. ITP is collaborating with approximately 100 companies, 
helping them measure and manage their energy usage so as to demonstrate 
that significant energy savings are possible. For example, after 
receiving three energy savings audits from ITP, an automotive 
manufacturer reduced its energy intensity 29 percent in 1 year at a 
U.S.-based facility.
    Now that ITP has demonstrated that significant energy intensity 
reductions are possible, the program is developing a set of standard 
tools and protocols to increase its leverage and reach. By investing in 
these standard tools and protocols that help private sector companies 
measure and manage their energy usage, ITP is fostering the energy 
management industry. ITP is also developing Professional Certification 
programs for energy management professionals and auditors who will be 
employed in the emerging energy management industry, as part of its 
development of a broader industrial energy efficiency certification 
program.
    ITP is also investing in the training of next-generation energy 
management engineers. Since 2002, 650 graduate and undergraduate 
students have been successfully trained in energy management through 
university-based Industrial Assessment Centers (IACs). ITP plans to 
continue to train additional students through these IACs over the 
coming years.
    All of these activities are being implemented in the near term, 
will result in energy efficiency gains, and will help create jobs and 
improve the competitiveness of U.S. companies.
                                 ______
                                 
             Questions Submitted by Senator Lamar Alexander

                           OAK RIDGE CLEANUP

    Question. Department of Energy (DOE) is requesting about $400 
million in fiscal year 2012 for clean-up activities at the Oak Ridge 
Reservation (ORR). Can you assure me the highest-risk safety concerns 
are being addressed at Oak Ridge Reservation? DOE is bartering its 
uranium inventory to help pay for costs of cleanup at the Portsmouth 
gaseous diffusion plant. Oak Ridge (East Tennessee Technology Park) is 
home to 1 of the 3 original uranium gaseous diffusion plants. Why 
shouldn't this facility (K-25) be cleaned up with funds gained in 
barter of uranium?
    Answer. The highest-risk safety concerns are being addressed at the 
ORR. The K-25 Building at the East Tennessee Technology Park (ETTP) is 
the highest-risk safety concern on the Reservation due to its age and 
deterioration, as well as the presence of special nuclear material and 
radiological and hazardous contaminants. The $400 million in fiscal 
year 2012 addresses this highest risk. For some of the other high risks 
on the ORR, such as mercury at Y-12 and nuclear materials in the 
Central Campus at the Oak Ridge National Laboratory (ORNL) 
(specifically, legacy materials at two of the former isotope production 
facilities, Buildings 3026 and 3038; and those found in the Tank W-1A 
area soils, the most significant source of groundwater contamination in 
that area), funds from the American Recovery and Reinvestment Act 
(ARRA) are being used to address these risks. As for the use of 
bartering of the uranium inventory to provide additional funding, DOE 
has established priorities for the transfer of uranium through 2013. 
The total proposed Department transfers through calendar 2013, 
including scheduled transfers by National Nuclear Security 
Administration (NNSA), are approximately 2,000 metric tons of uranium 
per year, or about 10 percent of U.S. reactor demand, which is a level 
consistent with the principles and policies set forth in the 
Department's Excess Uranium Inventory Management Plan.

                BLUE RIBBON COMMISSION ON NUCLEAR WASTE

    Question. Among the draft recommendations of the Blue Ribbon 
Commission is increased Federal investment to reduce nuclear waste with 
advanced materials. Please describe how your budget for nuclear energy 
would fund research in this area.
    Answer. The Reactor and Fuel Cycle Technology Subcommittee of the 
Blue Ribbon Commission on America's Nuclear Future (Commission) 
presented draft recommendations to the full Commission. These 
recommendations of the subcommittee are draft, and subject to further 
consideration by the full Commission. The Department will carefully 
consider the Commission's recommendations and advice contained in their 
final report--due in January 2012--and determine a path forward at that 
time.

                 AMERICAN RECOVERY AND REINVESTMENT ACT

    Question. DOE has roughly $2 billion in unspent American Recovery 
and Reinvestment Act (ARRA) funds for weatherization grants, and 
another $2 billion from the State Energy Grant program. Why do these 
balances exist, and why are additional funds being requested for fiscal 
year 2012 given the unspent balances?
    Answer. DOE set an aggressive 3-year performance period in the 
original grant contracts to maximize the timely job creation potential 
of the funds delivered to State and local communities under ARRA. This 
timeline has supported thousands of jobs, delivered energy-saving 
technologies that will save money for families, businesses, and State 
and local governments across the Nation for many years, and spurred 
American competitiveness in the global market for energy efficiency and 
renewable energy.
    As of December 19, 2011, grantees of the Weatherization Assistance 
Program (WAP) have spent $4 billion of their total $4.8 billion ARRA 
allocation. This leaves less than $850 million remaining to be spent in 
the final 4 months of the original grant period. It is anticipated that 
some grantees will have balances remaining on March 31, 2012 and will 
request performance period modifications so funds can continue to be 
used for their original purpose of weatherizing the homes of low-income 
families. WAP has already exceeded its original ARRA production goal of 
593,000 homes weatherized with 4 months remaining and could eclipse 
700,000 homes using the balances on existing grants.
    Grantees of the State Energy Program (SEP) have spent $2.1 billion, 
or more than two-thirds of their $3.1 billion ARRA allocation. DOE is 
working with each grantee to assess opportunities to responsibly deploy 
additional ARRA funds to fully use each grant and create jobs in their 
State and local communities. The vast majority--about 90 percent--of 
ARRA grant funds by DOE's SEP will be spent within the current 
performance period on projects that have supported thousands of jobs, 
saved energy, deployed clean-energy solutions, and strengthened the 
economic foundation of communities across the country. It is 
anticipated that some grantees will have relatively small balances 
remaining on April 30, 2012, and will request performance period 
modifications that will be considered on a case-by-case basis. SEP ARRA 
investments have supported energy-efficiency upgrades of more than 
60,000 buildings and building roofs, totaling approximately 361,000,000 
square feet, upgraded and repurposed more than 625,000 square feet of 
manufacturing space to produce clean-energy products, and contributed 
to the installation of 350,000 kW of renewable energy systems. These 
projects have supported high-paying jobs in the fields of construction 
and design/engineering, manufacturing and transportation while saving 
energy and money over the long term.
    Additional funds are included in the fiscal year 2012 budget 
request to support the efforts of WAP and SEP in their proven ability 
to drive economic development and job creation and to leverage Federal 
dollars using the lessons learned under ARRA. The majority of the 
Weatherization and Intergovernmental Programs (WIP) ARRA grants have a 
performance period ending in early 2012. Even with the performance-
period modifications, the majority of ARRA funds will be expended by 
then or shortly thereafter. The need for 2012 funding is vital to 
cushion the ramp down of production and employment in the 
weatherization network and to provide State and local governments with 
support in the continued administration of more than $530 million in 
revolving loan funds initiated in 35 States and 100 communities with 
ARRA funds. ARRA funding for WAP helped fund as high as 15,600 full-
time positions in the network and still is listed as seventh in the 
ARRA portfolio with 14,200 jobs supported last quarter. In addition, 
WAP has leveraged more than $800 million each year of ARRA in Federal 
and non-Federal funding to support the weatherization work at the local 
level. This leveraging has contributed significantly to the number of 
homes weatherized and jobs supported, and has assisted in expanding the 
array of services provided in each home. SEP will also continue to 
expand and replicate the many best practices developed with ARRA grant 
funds throughout the country, leveraged by the innovative financing 
programs they have started. These types of activities continue with any 
annual appropriations provided by the Congress.

                          CONTRACTS MANAGEMENT

    Question. DOE has been on Government Accountability Office's (GAO) 
high-risk list for potential fraud, waste, and abuse for contractor 
oversight since 1990. According to GAO, ``GAO designated DOE's contract 
management as a high-risk area in 1990 because of DOE's record of 
inadequate management and oversight of its contractors.'' While the 
Office of Science (SC) was removed from the ``high risk'' status, 
Environmental Management and NNSA remain. What steps is DOE taking to 
improve contracts management within the Office of Environmental 
Management (EM)?
    Answer. Over the last 2 years, EM has continued to implement 
corrective actions and been recognized by GAO as having met 3 of the 5 
criteria for removal from the high-risk list. EM leadership remains 
fully committed to continuing this improvement journey. GAO also 
acknowledged positive actions for the two criteria not yet achieved. 
These actions include the establishment of clear project and contract 
management policies and guidance, use of a certified earned value 
management system by our contractors as well as ensuring our Federal 
oversight staff was certified at the appropriate level. GAO has noted 
``the steps illustrate DOE's commitment to improving its contract and 
project management, but the results of these efforts must ultimately be 
demonstrated through improved project performance.'' Toward that end, 
the current project performance data show that EM will meet or exceed 
the success criteria of completing 90 percent of capital asset projects 
within 10 percent of original cost and schedule baselines.
    The two remaining criteria which GAO has judged EM as having not 
achieved are providing the capacity, both people and resources, to 
address problems, and independent validation that corrective measures 
are effective and sustainable.
    EM has taken the following actions to address capacity:
  --EM has assigned senior, experienced project managers as 
        Headquarters Project Sponsors for three large capital projects, 
        Sodium Bearing Waste Project in Idaho, Salt Waste Processing 
        Facility at Savannah River, and U-233 Facility at Oak Ridge.
  --EM has hired a Chief Scientist to serve as a direct advisor to the 
        Assistant Secretary of EM for complex technical and design 
        issues.
  --EM has arranged for high-caliber technical expertise through use of 
        a Technical Expert Group which has access to multiple DOE 
        national laboratories.
  --EM has continued review of project staffing adequacy during 
        recurring independent project reviews.
    EM has taken the following actions to address validation:
  --Conducting monthly project reviews incorporating lessons learned 
        from transparent reporting on ARRA projects.
  --Completing Independent Project Reviews, modeled after the SC 
        approach, on a semi-annual schedule for the larger capital 
        projects.
  --Actively participating in recent Department-wide initiatives for 
        improvement in contract and project management.
    EM is committed to continuous improvement in its performance of its 
mission and in the achievement of all the GAO criteria.

                              SCIENCE LABS

    Question. SC is currently operating 10 DOE labs across the country. 
Can we afford to continue to operate all of these facilities? Should we 
start looking at reducing the number of national labs?
    Answer. We believe that continued operation of DOE's national 
laboratories, at the levels proposed in the fiscal year 2012 
President's budget, is a national priority. The 10 Office of Science 
laboratories play a critical role in the Nation's research and 
development (R&D) enterprise. The Department's national laboratories 
are home to the world's largest collection of scientific user 
facilities, supporting more than 26,000 unique users from universities, 
national labs, other Federal agencies and businesses large and small 
each year. Functioning as an interdependent system with an exceptional 
set of world-leading facilities and distinctive capabilities, they 
deliver clear benefits to the Nation's research community and help 
solve problems of national importance. They work in partnership with 
universities and industry, transfer the results of their R&D to the 
marketplace, and support the training of the future science and 
engineering workforce.
    It is increasingly clear that transformational science and 
breakthrough technologies will be needed to overcome the complex 
challenges that we face as a Nation in the 21st century:
  --increasing the availability of clean, reliable, and affordable 
        energy;
  --ensuring our national security in a changing world; and
  --enhancing U.S. competitiveness by encouraging innovation.
    DOE national laboratories are uniquely equipped and positioned to 
make substantial contributions to the U.S. research enterprise.
    More than 80 Nobel prizes have resulted from research affiliated 
with DOE, much of which was made possible by the unique instrumentation 
and equipment available to the scientific community through the 
national laboratories.
    Some recent results of research conducted by the laboratories 
operated by the SC include:
  --development of the world's smallest battery;
  --development of software that searches databases 10 to 100 times 
        faster than large commercial database software;
  --development of a technology to use complementary strands of 
        synthetic DNA to build functional materials from the smallest 
        building blocks--future applications include biosensors, 
        optical nano-devices, and new kinds of solar cells;
  --development of the first microbe that can produce an advanced 
        biofuel (an alternative to petroleum) directly from fatty acids 
        in biomass;
  --development of nanoscale catalysts and multifunctional membranes 
        that may greatly enhance the practicality of fuel-cell powered 
        vehicles; and
  --development of a technique to create thin diamond films that are 
        helping industry create energy-saving, ultra-low friction and 
        wear coatings for mechanical pump seals and tools.
    Each of these accomplishments was made possible by a consistent and 
sustained investment in DOE's national laboratories, which provide 
unique capabilities for maintaining U.S. leadership in science and 
technology. These national laboratories also contain the world's 
largest suite of synchrotron radiation light source facilities, neutron 
scattering facilities, electron-beam microcharacterization centers, and 
nanoscale science research centers, which provide open access to 
specialized instrumentation and expertise that enable scientific users 
from universities, national laboratories, and industry to carry out 
experiments and develop theories that could not be done at their home 
institutions.
    During these tough economic times, DOE recognizes the need to 
identify savings throughout its budget. In the fiscal year 2012 budget 
request to the Congress, SC funded its national laboratories at a level 
consistent with the needs of the Department and the scientific 
community. Savings will be realized in fiscal year 2012 with the 
termination of operations at the Holifield Radioactive Ion Beam 
Facility national user facility at ORNL. In addition, by the end of 
fiscal year 2011, we are completing operation of the world's largest 
proton-antiproton collider, the Tevatron, at the Fermi National 
Accelerator Laboratory. The planned closure of the Tevatron coincides 
with the full start of operations of the Large Hadron Collider in 
Europe.
    Question. Should we start looking at reducing the number of 
national labs?
    Answer. SC regularly reviews the status of the projects and 
programs underway at the laboratories to ensure that they are focused, 
unique, and producing the significant scientific results required and 
expected from the investment of taxpayer dollars. Science's 
laboratories are not static. SC actively engages its labs to assure 
continued relevance and renewed infrastructure. No lab demonstrates 
that better than SLAC National Accelerator Laboratory. A few years ago, 
it was single-purpose particle physics lab. Through prudent 
investments, such as the Linac Coherent Light Source, SLAC is now a 
vibrant, multi-program laboratory making significant contributions in 
photon science, astrophysics, particle physics, and accelerator 
research. ORNL in your home State has similarly been revitalized and 
renewed over the past decade. The programs and projects at the national 
laboratories are designed, executed, and monitored to leverage, not 
duplicate, the activities conducted by other participants in the global 
scientific and academic communities. It is critical to our national 
security, as well as our economic, technical, and scientific standing 
in the world that these national laboratories continue to foster the 
future technological innovations and scientific discoveries that will 
continue to lead the United States on a path of prosperity.

                             FOSSIL ENERGY

    Question. If one of the goals of this administration is to reduce 
emissions, then why reduce funding for fossil energy? If we want 
cleaner coal or carbon sequestration, how do you accomplish this 
without continued investment is fossil fuels research?
    Answer. The Fossil Energy (FE) fiscal year 2012 budget request 
upholds the President's goals to develop America's innovative 
competitive edge through strategic investments in our Nation's clean-
energy research, development, and demonstration (RD&D) activities. FE's 
budget request takes into consideration the need for budget restraint, 
which requires making tough choices across all DOE R&D program areas. 
We are investing in only the key enabling technologies that are on 
critical paths and that show the highest-potential impacts on achieving 
the program goals and benefits in the timeframe needed for deployment. 
In addition, ARRA funding provided substantial investments in carbon 
capture and storage R&D and demonstrations ($3.4 billion from ARRA 
funds).

                      STRATEGIC PETROLEUM RESERVE

    Question. DOE proposes to sell some crude oil reserves to generate 
$500 million in budgetary savings. Please describe in detail the 
rationale for reducing the inventory? If the proposal is driven based 
on the need to free up space for inspection and maintenance purposes, 
why isn't DOE proposing a specific number of barrels, rather than a 
dollar amount? What type grade do you propose to sell (light, heavy, 
sweet or sour), and what is the basis for that plan?
    Answer. The sale is proposed to provide operational flexibility in 
managing the reserve. The Strategic Petroleum Reserve seeks to reduce 
its inventory by 5-6 million barrels in order to alleviate unplanned 
overcapacity at some SPR caverns. The overfilling occurred due to the 
relocation of crude oil from Bayou Choctaw Cavern 20 to other caverns 
and the need to free up cavern space throughout the SPR complex. Spare 
capacity and operational flexibility is needed for example to perform 
casing inspections and workovers, to allow on-site oil movements that 
may be required from time to time, and to comply with a recent Texas 
Railroad Commission requirement for more stringent inspections. No 
decisions have been made about what grade of crude oil would be sold.
                                 ______
                                 
             Questions Submitted by Senator Mitch McConnell

    Question. Does the Department have a timeline for considering an 
unsolicited proposal on tails re-enrichment or releasing an updated 
uranium inventory management plan? Given that there are more than 1,200 
jobs on the line, is there no sense of urgency at the Department to 
accelerate the consideration of re-enriching uranium tails?
    Answer. Upon receipt of any unsolicited proposal, the Department of 
Energy (DOE) conducts a review consistent with applicable statutes, 
regulations, and guidelines. While there is no set period of time for 
review of an unsolicited proposal, the Department conducts its review 
as expeditiously as possible. The Department is currently working on 
updating its Excess Uranium Inventory Management Plan. The Department's 
2008 Excess Uranium Inventory Management Plan provided guidelines for 
the management of the Department's excess uranium inventory and 
described planned and future projects under consideration, as 
envisioned in 2008. The Plan was a 10-year estimate of future sales and 
transfers and it contained the caveat that situations could arise where 
DOE's actions could change in response to unforeseen developments. 
Depending on programmatic and policy goals and needs, the Department is 
evaluating the impacts of changes and decisions made since 2008 and 
will revise the Plan accordingly.
    Any decision by the Department regarding the possible enrichment of 
its higher assay tails would have to include careful consideration of 
several factors, among them an appropriate contracting approach, the 
economic benefits to the taxpayer, and the potential market impacts of 
processing and selling the higher assay tails. A decision should not be 
made prior to our full evaluation of all the factors.
    Question. A decade's worth of clean-up efforts have been ongoing at 
the Paducah Gaseous Diffusion Plant (PGDP), which have included the 
removal of 30,000 tons of scrap metal, stored hazardous waste, 
contaminated soil, and facilities. DOE annually submits a budget 
request to continue these clean-up efforts. However, there is the 
potential for a budget shortfall in the coming years. What is DOE's 
proposal to ensure that future budgets meet the needs of clean-up work 
at the PGDP?
    Answer. The Department believes meeting its compliance milestones 
is essential and continues to prioritize actions to stay on course to 
meet these enforceable agreements. The Department continues to work 
with its regulators to ensure projects are appropriately sequenced to 
optimize resources while utilizing a risk-based approach to cleanup.
    Question. If the Department does not anticipate issuing a plan, has 
the Department included funds in its fiscal year 2012 budget to safely 
and securely idle the plant once it returns to DOE control? How much 
does DOE estimate it needs to idle the plant each year?
    Answer. The timing of the return of the PGDP to DOE is a business 
decision solely within United States Enrichment Corporation's (USEC) 
purview. There are provisions of the USEC lease that we would expect 
USEC to comply with, in the event USEC decides to cease operations at 
the Paducah plant. USEC has an obligation under the lease to provide 
DOE with a 2-year notification of USEC's intent to return the PGDP. The 
2 years notice was intended to allow DOE to seek congressional 
appropriations as part of our annual budget process. DOE will develop 
estimates for decontamination and decommissioning activities after 
receiving the 2-year notice from USEC.
                                 ______
                                 
             Questions Submitted by Senator Lindsey Graham

                                H-CANYON

    Question. H-Canyon is a remarkable asset that can play a key role 
in the future of the complex. It has the capability to handle some of 
the most complicated materials on Earth. It also has the ability to 
produce fuel for NASA's space missions and could be the place where the 
breakthroughs are made for the next generation of spent-fuel recycling. 
However, your budget does not allow for any of these activities. In 
fact, the Defense Nuclear Safety Board has warned that the canyon could 
be lost forever under current Department of Energy (DOE) plans. How do 
you justify this? How much would it cost to construct a new canyon? How 
long would that take? What is the future of H-Canyon?
    Answer. For approximately the past 3 years, H-Canyon has been 
operating to complete the blend down of enriched uranium recovered from 
the processing of surplus unirradiated highly enriched uranium (HEU) 
materials. The Department intends to complete the current HEU blend 
down work in 2011. The Department is planning to transition H-Canyon 
and HB-Line facilities to modified operations in fiscal year 2012. H-
Canyon will continue to receive sample returns from the Savannah River 
National Laboratory and F Area Laboratory and disposition the samples 
to the liquid waste system. H-Canyon will also remediate large boxes of 
legacy transuranic waste. The Department will retain critical staff and 
perform proficiency runs which maintain the operator qualifications and 
exercise the processing equipment.
    Much of the remaining material that could be processed in H-Canyon 
in the future is used nuclear fuel (UNF). The Secretary of Energy has 
determined that no processing of aluminum-clad UNF will occur until the 
recommendations of the President's Blue Ribbon Commission (BRC) on 
America's Nuclear Future are issued and evaluated by the Department. 
The proposed operational condition of H-Canyon will allow the 
flexibility to process aluminum-clad UNF or any other appropriate 
nuclear materials, in the future, should that decision be made.
    Question. The core mission of DOE's Environmental Management 
program is to reduce the amount of waste currently sitting in our 
weapons complex. As such, any decision that would result in the 
stranding of material should run counter to DOE's mission. This is why 
DOE's decision not to process 14 metric tons of aluminum clad defense 
spent nuclear fuel through H-Canyon is so problematic. Under DOE's 
current vision, this fuel has no disposition path. Will you work with 
me to ensure that this material does not remain in South Carolina if it 
is not to be processed through the canyon?
    Answer. The Department does not intend to indefinitely store used 
nuclear fuel (UNF) at the Savannah River Site. However, I have 
determined that no further processing of aluminum-clad UNF will occur 
until the recommendations of the President's BRC on America's Nuclear 
Future are issued and evaluated by the Department. This will allow the 
Department to make sure these recommendations are factored into 
decisions on how best to process and disposition this material. By 
retaining critical staff and performing proficiency runs to maintain 
operator qualifications and exercise processing equipment, the 
capability to process spent fuel in the future is being preserved. 
Should a decision be made to not use the H-Canyon to process the spent 
fuel, I will work with you to determine an alternative that ensure 
unprocessed UNF does not remain at the Site.
    Question. Trimming unnecessary costs is one way to get our overall 
budget house in order. Spending money to expand L-basin, where the 
aluminum clad fuel is stored, instead of processing it through the 
canyon makes little sense to me. Wouldn't it save DOE money over the 
long term to process the aluminum clad fuel and ultimately close L-
basin?
    Answer. Per my previous response, no processing of aluminum-clad 
UNF will occur until the recommendations of the President's BRC on 
America's Nuclear Future are issued and evaluated by the Department.

                                HYDROGEN

    Question. Just recently 13 of my colleagues sent you a letter about 
our support for the fuel cell and hydrogen energy technology programs 
in your portfolio. Do you share our concern that further cuts to these 
programs would inhibit the long-term diversification of our Nation's 
energy portfolio and stunt the development of American-engineered and 
domestically produced energy systems powered by hydrogen and fuel 
cells?
    Answer. The Department's strategy is to sustain a balanced research 
and development (R&D) portfolio, with an emphasis on nearer-term 
priorities, such as batteries, advanced vehicle technologies, and 
technologies for renewable power and energy efficiency. Fuel cell 
electric vehicles (FCEVs) are still part of the portfolio of options 
under development. In fact, DOE's increased funding for battery R&D 
will also be beneficial for FCEVs which rely on batteries in addition 
to fuel cells.
    The Department will continue its critical efforts in hydrogen and 
fuel cell R&D, which have already reduced the cost of fuel cells by 
more than 30 percent since 2008 and 80 percent since 2002.\12\ In fact, 
DOE's hydrogen and fuel cell program has been extremely successful, 
resulting in approximately 200 patents, 30 products being put on the 
market, and industry currently pursuing development of more than 50 
emerging technologies.\13\ The fiscal year 2012 budget sustains DOE's 
core R&D efforts which will continue to advance the technologies and 
improve the likelihood of a successful rollout by automobile 
manufacturers in the coming years.
---------------------------------------------------------------------------
    \12\ http://hydrogen.energy.gov/pdfs/10004_fuel _cell_cost.pdf.
    \13\ http://www1.eere.energy.gov/hydrogenandfuelcells/ pdfs/
pathways.pdf.
---------------------------------------------------------------------------
    Question. I understand there are studies out there, including one 
done by the Savannah River National Laboratory in SC, that show that 
battery electric vehicles (BEVs) and plug in hybrid electric vehicles 
(PHEVs) are not going to be cheaper than FCEVs nor is their needed 
infrastructure going to be cheaper. Do you agree with this assessment?
    Answer. We are not aware of the Savannah River National Laboratory 
study you reference, so we cannot comment specifically on its 
assessment. In general, however, it is very difficult to compare 
vehicle and infrastructure costs across technologies. There are a 
number of variables affecting infrastructure cost--such as location and 
site preparation requirements, public accessibility (versus home-access 
only), production technology (for hydrogen), and size of station/volume 
of fuel required or type of electric charging. In addition, although 
R&D is needed to further reduce cost and improve performance of all 
advanced vehicle technologies, each is in a different stage of 
development with different early market requirements, cost-reduction 
targets, and timelines.
    A variety of vehicle technologies and fuels will be required to 
meet the Nation's short-term and longer-term goals of reducing 
petroleum use and greenhouse gas emissions. These technologies are 
developing along different timelines: PHEVs, for example, are 
commercially available today and do not necessarily require any 
additional infrastructure--drivers can charge at home using a standard 
outlet or fuel with gasoline at an existing station, if needed for 
traveling longer distances. BEVs are also commercially available today 
but have different infrastructure requirements. Drivers can charge at 
home overnight using equipment that ranges from $800 to $2,000 
installed; cost estimates for public electric charging equipment and 
installation can vary from $5,000 to $50,000 per charging point, 
depending on the type of charging (Level 2 vs. DC fast charging) and 
other factors (noted above). While FCEVs are not yet commercially 
available, a number of the world's major auto manufacturers have 
announced initial rollouts in the 2015 timeframe. FCEVs will have 
different infrastructure requirements than PHEVs and BEVs.
    Question. Two weeks ago, at your agency's Quadrennial Technology 
Review (QTR) Workshop in Knoxville, Tennessee, representatives from 
hydrogen, fuel cell vehicle, and stationary source fuel cell companies 
heard Under Secretary for Science Koonin say, in front of 100 people, 
that fuel cells and hydrogen were left out of the QTR Framing Document 
to ``see what the reaction would be.'' Do you agree with Under 
Secretary Koonin's approach to the QTR?
    Answer. Under Secretary Koonin has a proven track record of 
bringing diverse groups together and facilitating vigorous technical 
discussions, which is why I asked him to lead our first ever QTR.
    As you are aware, we released the QTR Framing Document in March, 
where we provided a first pass at those technologies that are likely to 
scale up in time to materially impact the President's energy security 
and environmental goals--and to do so affordably. In view of the 
multitude of technologies that could be developed and demonstrated, we 
must set clear priorities within the existing policy framework and 
establish principles that will enable us to coordinate our research, 
development, and demonstration (RD&D) efforts with those of the private 
sector to facilitate timely and material deployment of clean-energy 
technologies. Consequently, in the initial framing document we left out 
a number of technologies that are at the experimental stage or face 
significant technical or multiple infrastructure hurdles. Hydrogen and 
fuel cells were not the only technologies in that category.
    The QTR Framing Document was intended to stimulate discussion and 
facilitate stakeholder engagement as crucial elements of the QTR 
process. In response to comments submitted by representatives from 
hydrogen, fuel cell vehicle, and stationary source fuel cell companies, 
Dr. Koonin invited a number of them to the vehicle efficiency and 
electrification workshop in Knoxville, Tennessee on May 4, 2011 and to 
a clean electricity supply workshop held in Boulder, Colorado on June 
7, 2011. The discussion among technical experts across a spectrum of 
technologies has been invaluable in shaping the QTR team's thinking 
about the highest and best uses of fuel cells and hydrogen in the 
Nation's energy future.
    Fuel cells for distributed generation were already included as 1 of 
the 19 technology assessments that form the foundational analysis of 
the QTR, and hydrogen is considered in our vehicle electrification 
technology assessment. These technology assessments, which were not 
released as part of the Framing Document, are expected to be important 
components of the final report on the QTR.

                      SAVANNAH RIVER SITE PENSIONS

    Question. I have long been concerned about the cost of DOE 
pensions. The growing costs could very well impact programmatic work 
throughout the weapons complex. In fiscal year 2012, what is the 
projected pension obligation across the weapons complex?
    Answer. The table below includes the estimated fiscal year 2012 
contributions for each National Nuclear Security Administration (NNSA) 
contractor based on updated information submitted by the contractors 
during fiscal year 2011.

              [Updated estimates as of September 30, 2011]
------------------------------------------------------------------------
                                                             2012 NNSA
                                                              portion
------------------------------------------------------------------------
University of California Retirement Plan--Lawrence                   178
 Berkeley National Laboratory...........................
Pension Plan for Eligible Bettis Employees and Retirees           59,500
 \1\....................................................
Pension Plan for Pacific Northwest Laboratories,                  10,380
 Battelle Memorial Institute............................
BW Y-12 Pension Plan....................................          79,580
Idaho National Laboratory Employee Retirement Plan......           7,546
Salaried Employee Pension for KAPL Employees and                  65,000
 Retirees \1\...........................................
Pension Plan for KAPL Employees in Participating                   7,100
 Bargaining Units \1\...................................
Kansas City Division (Honeywell International, Inc.)               9,110
 Hourly Employees Pension Plan..........................
Honeywell Retirement Earnings Plan for Aerospace                  26,910
 Employees at the Kansas City Division..................
LANS Defined Benefit Pension Plan.......................          71,940
University of California Retirement Plan Livermore......         153,900
University of California Retirement Plan--Los Alamos....          70,100
National Security Technologies, LLC [NSTec] Employee              14,490
 Retirement Plan........................................
B&W Pantex Guards Union.................................           3,000
B&W Pantex Metal Trades Council.........................           8,800
B&W Pantex, Non Bargaining..............................          17,800
Sandia Corporation Retirement Income Plan...............         108,430
Savannah River Nuclear Solutions Multiple Employer Plan.          48,747
Pension Plan for Employees at ORNL......................           5,787
WSI Las Vegas...........................................           1,600
WSI Independent Guard Association of Nevada.............           1,332
WSI Pension Plan for Employees at Oak Ridge, Tennessee..           1,159
Battelle Memorial Institute SERP Non-Qualified Plan.....               2
Bechtel Marine Propulsion Non-Qualified Plan \1\........           1,138
KAPL Non-Qualified Plan \1\.............................             229
LANS 401(a)(17) Restoration Plan........................               4
LANS Restoration Plan...................................               2
LLNS 401(a)(17) Restoration Plan........................              41
LLNS Restoration Plan...................................              19
Sandia Corporation Non-Qualified Pension Plan...........             824
Savannah River Nuclear Solutions Non-Qualified Plan.....              95
                                                         ---------------
      Total.............................................         774,743
------------------------------------------------------------------------
\1\ NNSA pension contributions for the five Naval Reactors plans include
  contributions reimbursed by the Department of the Navy and work for
  others.

    Question. I previously proposed language in the Defense 
Authorization Act that would require DOE and NNSA to report their 
pension obligations as a line item in the budget. This would give the 
Congress a better sense of the cost of pensions on the complex. Do you 
support this effort? Why not?
    Answer. Increased visibility of pension liabilities is a goal the 
Department supports. However, reporting them as a line item in the 
budget is not viable due to budget formulation, execution, and 
accounting concerns. To enhance visibility of pension liabilities, the 
Department included a separate section on pensions in its congressional 
budget request for both fiscal year 2011 and fiscal year 2012. This 
section of the budget provides projected contractor defined-benefit 
(DB) pension plan contributions for fiscal year 2011 and fiscal year 
2012 by plan and by Program Office. For the NNSA, the projected 
contractor DB pension plan contributions are provided for fiscal year 
2010 through fiscal year 2016 by plan.
    At the time the Department's budget request is submitted, the 
Department provides the latest pension contribution estimates available 
from its contractors. However, the actual amount of the contractors' 
annual defined benefit pension contributions is not typically known 
until the third quarter of the year of budget execution. Projections of 
future pension contributions are highly sensitive to underlying data, 
economic conditions, and actuarial methods and assumptions. Thus, the 
final annual actuarial valuation likely will yield different 
contribution amounts than the amounts estimated at the time of budget 
submission. For instance, we are currently preparing the budget 
submission for fiscal year 2013. At the same time, the contractors are 
waiting on the actuaries to complete the various analyses to determine 
the actual payments required for calendar year 2012. Because the budget 
formulation cycle occurs so far in advance of the pension plan 
execution year, directly funding pension obligations through a line 
item is not desirable.
    Further, the current methodology of having the pension liabilities 
collected through indirect cost pools allows the Department to charge 
all customers doing business at a site for a portion of the pension 
liability. If pension liabilities were fully ``direct funded'', the 
Department would bear the full costs of the liabilities whereas with 
the current budget and accounting system permits the Department to 
recover pension costs through overall indirect costs charged to non-DOE 
customers.
    Another disadvantage of ``direct funding'' the pension liabilities 
would be a reduction in the contractors' and the Department's ability 
to quantify the true cost of the work at the site, inclusive of costs 
for contractor employees' pension benefits. The result would be the 
loss of a key self-policing aspect of the current approach to funding 
pensions. In particular, when the true indirect cost of work, including 
pension costs, is proportionally shared with each site customer, it 
creates an incentive for contractors to minimize their overall indirect 
costs insofar as the contractors must keep indirect costs low to 
attract work from other agencies or entities. If pensions were ``direct 
funded'', this market pressure would be largely absent because a large 
component of total indirect cost pool would be removed from the 
indirect costs.
    One area where the Department does submit a direct request for 
pension liabilities is for legacy pension benefits. NNSA has a 
continuing obligation to reimburse the University of California 
Retirement Plan to fund retirement benefits for University of 
California (UC) retirees from Los Alamos and Lawrence Livermore 
National Laboratories. NNSA is unable to recover the costs associated 
with the liability to the UC through indirect cost pools as NNSA does 
for pension costs associated with benefit plans sponsored by current 
NNSA contractors. The difference between the two payment methods is a 
critical and significant difference that requires the disparate 
treatment in the budget.
                                 ______
                                 
            Questions Submitted by Senator Daniel K. Inouye

    Question. I wish to thank you and the Department for maintaining 
the Hawaii office to manage the energy programs and to coordinate with 
the military, the Department of Energy (DOE), and State endeavors. The 
office has been invaluable and continues to support the development and 
implementation of alternative energy policy including those important 
to State and local efforts, partnerships between military and civilian 
efforts in the field and new partnership opportunities involving other 
nations, including Japan. It is my sincere hope that this office will 
continue in fiscal year 2012 and beyond.
    Does the Department have any plans to make meaningful commercial 
investments in ocean thermal energy conversion (OTEC)? If so, how would 
the Department mitigate any environmental concerns? What would be the 
Department's timeframe for such investments?
    Answer. As part of the Department's investments in water power 
technologies, we are currently evaluating the life-cycle costs of OTEC 
power generation and undertaking a rigorous OTEC resource assessment. 
The results of these studies will provide important baseline 
information regarding the potential contribution that OTEC could make 
to our Nation's renewable energy portfolio, as well as the cost of 
energy from OTEC. These reports, which will be completed this fiscal 
year, will serve to inform the Department's investment strategy going 
forward, and allow us to make appropriate investments across all 
renewable energy technologies. While OTEC development and production 
costs are currently estimated to be significantly higher than some 
other energy technologies, the Department has been pursuing a small 
number of targeted technology development projects that aim to advance 
technology readiness, establish a baseline for cost estimates, and 
improve the cost-competitiveness of OTEC generation.
    The Department has been working closely with the National Oceanic 
Atmospheric Administration (NOAA) and the U.S. Navy in the assessment 
of OTEC technologies, with a particular focus on the environmental 
concerns associated with OTEC power generation. In partnership with 
NOAA, DOE is developing guidelines that consider the full realm of 
potential environmental impacts, while also considering potential 
mitigation strategies. This effort includes a series of workshops with 
technical, scientific, and environmental experts from within the 
Federal Government as well as key stakeholder groups. This information 
will serve to inform our future investment strategy so that any future 
commercial development is undertaken in an environmentally sustainable 
manner.
    In order to fully evaluate the technical, environmental, and 
economic performance of a fully integrated, open-ocean OTEC system, it 
is envisioned that a demonstration project in the range of 10 MW to 100 
MW would likely be required. Initial cost estimates for plants of this 
size are $350 million to $1.1 billion. Given the magnitude of such an 
investment and the early stage of OTEC technology development, the 
Department does not envision making any investments in OTEC at this 
scale in the near future.
    Question. Does the Department plan any follow-on competitions to 
follow-up on the successes from the stimulus investment?
    Answer. DOE intends to continue supporting the Pacific Office 
established in 2010 in Honolulu, Hawaii, and we are pleased with your 
perception of our accomplishments and progress. In August 2011, the 
Office of Electricity Delivery and Energy Reliability, with financial 
support from the Department of Defense (DOD), will be stationing a 
staff member in the J-9 office of the U.S. Pacific Command (PACOM) to 
support Command interests in energy and security issues. That staff 
member and the DOE Pacific Office staff will coordinate efforts with 
DOD while continuing the 3 years of effort with the State of Hawaii and 
other U.S. Pacific activities.
    Regarding future competitive funding opportunities, the citizens 
and government of Hawaii will be informed of future announcements. It 
is our normal practice to competitively award research and deployment 
projects. We are aware that both the Governor's office and several 
Hawaii government agencies are routinely exploring and applying for new 
project grants from DOE.

                         CONCLUSION OF HEARINGS

    Senator Alexander. The hearing is concluded.
    Secretary Chu. Thank you.
    [Whereupon, at 4:29 p.m., Wednesday, May 18, the hearings 
were concluded, and the subcommittee was recessed, to reconvene 
subject to the call of the Chair.]


              MATERIAL SUBMITTED SUBSEQUENT TO THE HEARING

    [Clerk's Note.--The following testimony was received by the 
Subcommittee on Energy and Water Development for inclusion in 
the record.]
     Prepared Statement of the Environmental Council of the States
 state environmental agency directors support fiscal year 2012 funding 
   appropriation for u.s. department of energy's nuclear cleanup work
    Dear Madam Chairwoman Feinstein and Ranking Member Alexander: We 
are writing to you on behalf of ECOS, the national nonprofit 
nonpartisan association of State environmental agency directors.
    As you consider appropriation levels for the fiscal year 2012 
Federal budget, we urge you to consider the U.S. Department of Energy's 
(DOE) nuclear clean-up work a funding priority.
    DOE has requested that $6.13 billion be appropriated to fund its 
Office of Environmental Management (EM) for fiscal year 2012 so the 
agency can remediate hazardous and radiological contamination at sites 
within the nuclear weapons complex. This figure represents the amount 
of funding DOE needs to successfully perform cleanup work to levels 
necessary for meeting its obligations to State governments outlined in 
cleanup agreements.
    On March 24, 2010, the State environmental agency directors passed 
a resolution urging the Congress to ``appropriate the levels of funding 
necessary to ensure EM annual budgets are fully funded and fully 
compliant'' noting that ``stable funding leads to greater efficiencies 
in cleanup cost and schedule'' (see addendum).
    Therefore we believe that the Congress should fully fund DOE's 
fiscal year 2012 budget request for the EM program. DOE has told States 
that if a lower level of funding is appropriated for fiscal year 2012, 
cleanup of contaminated soils and groundwater will be delayed.\1\
---------------------------------------------------------------------------
    \1\ Presentation to the National Governors Association from Ines R. 
Triay, Assistant Secretary for Environmental Management, U.S. 
Department of Energy. May 6, 2011.
---------------------------------------------------------------------------
    Cleanup of the nuclear weapons complex represents a large liability 
to the Federal Government, but this is a liability that continues to 
shrink as cleanup is achieved at various sites within the complex. As 
States, we understand what it is like to make tough funding decisions. 
For this one, we urge you to allow DOE to continue the cleanup work to 
its conclusion.
    Thank you for considering our position as you work toward passing a 
Federal budget. Please contact R. Steven Brown, executive director of 
ECOS if you have any questions about this letter.

            CLEANUP BUDGETS FOR THE NUCLEAR WEAPONS COMPLEX

    WHEREAS, the Nation's nuclear weapons production and research and 
development activities, conducted largely between the 1940s and 1980s, 
have left a legacy of hazardous, radiological, and mixed wastes 
scattered across sites widely referred to as the ``nuclear weapons 
complex'' (the ``complex''); and
    WHEREAS, proper cleanup of the complex is critical for protecting 
human health and to ensure that damages to natural resources are 
mitigated and/or compensated for; and
    WHEREAS, the complex consists of over 100 sites in 33 States, 
thereby comprising one of the largest environmental cleanup operations 
being undertaken in the United States; and
    WHEREAS, at least 14 States currently host active cleanup 
operations spearheaded by the U.S. Department of Energy (U.S. DOE) 
Office of Environmental Management (EM); and
    WHEREAS, State environmental agencies are regulators with U.S. EPA 
and U.S. DOE, and may oversee cleanup operations within the complex as 
established by Federal Facility Agreements (FFAs), permits, and consent 
orders under FFCA, CERCLA, RCRA, and other laws; and
    WHEREAS, some sites within the complex, including the Ohio Fernald 
and Colorado Rocky Flats sites, have benefited from accelerated 
cleanups that have generated cost savings from reduced future 
maintenance costs that were not redirected toward other site cleanups 
within the complex; and
    WHEREAS, the influx of funding from the American Recovery and 
Reinvestment Act of 2009 (ARRA) has provided for further acceleration 
of nuclear and hazardous waste cleanups as well as decontamination and 
demolition of obsolete facilities within the complex; and
    WHEREAS, recently completed cleanups have shrunk the footprint and 
overall size and presence of nuclear weapons complex sites within the 
States; and
    WHEREAS, notwithstanding these recent successes, continued cleanup 
of the complex remains a priority issue for the States; and
    WHEREAS, stable funding leads to greater efficiencies in cleanup 
cost and schedule for both U.S. DOE and the States.

NOW, THEREFORE, BE IT RESOLVED THAT:
    ECOS strongly supports continued environmental cleanup of the 
nuclear weapons complex.
    ECOS recommends that U.S. DOE continue cleaning up the nuclear 
weapons complex and maintain a strong forum for communication and 
planning with State oversight officials via ECOS.
    ECOS urges U.S. DOE officials to request fully funded, fully 
compliant annual budgets for the EM program to ensure enough funds are 
provided to all sites to achieve cleanup milestones on schedule as 
required by FFAs, permits, and consent orders.
    ECOS urges the U.S. Congress to appropriate the levels of funding 
necessary to ensure EM annual budgets are fully funded and fully 
compliant as just described.
    ECOS urges U.S. DOE to establish mechanisms whereby any cost 
savings that result from accelerated cleanups are recouped and 
redirected toward funding other site cleanups within the nuclear 
weapons complex, and
    This resolution will be transmitted to the U.S. Congress, the 
Secretary of Energy, the Assistant Secretary of Energy for 
Environmental Management, the National Governors Association, and other 
stakeholder groups.


    ENERGY AND WATER DEVELOPMENT APPROPRIATIONS FOR FISCAL YEAR 2012

                              ----------                              

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.

                       NONDEPARTMENTAL WITNESSES

    [Clerk's note.--The subcommittee was unable to hold 
hearings on nondepartmental witnesses. The statements and 
letters of those submitting written testimony are as follows:]

                      DEPARTMENT OF DEFENSE--CIVIL

                         Department of the Army

                       Corps of Engineers--Civil

Prepared Statement of the Board of Commissioners, Fifth Louisiana Levee 
                                District

    The Board of Commissioners for the Fifth Louisiana Levee District 
respectfully requests that construction funding for Mississippi River 
levees be increased from the $24,180,000 contained in the proposed 
budget for fiscal year 2012, to the U.S. Army Corp of Engineers' (COE) 
capability of $59,980,000.
    Reduced funding, combined with the inability to let construction 
contracts under a continuing contract clause, has left thousands of 
people in Louisiana vulnerable to the adverse effects of a deficient 
levee system. Construction of levee enlargements is essential if the 
levee is to contain the ``Project Flood'' which is estimated to be 20 
percent greater than the record Flood of 1927.
    The effect of fully funded contracts for levee construction, now 
required under Public Law 109-103, (sections 106 and 108), adopted by 
the 109th Congress in 2005, as opposed to the previous system of 
continuing contract clauses, has virtually halted enlargement of the 
Mississippi River levee system in Louisiana. Year after year, as the 
cost of projects and maintenance has increased, funding for levee 
systems and flood control has been reduced. The current proposed budget 
is no exception, with only $210 million allocated for the entire 
Mississippi River and Tributaries (MR&T) project. We request that be 
increased to COE's capabilities of $335 million.
    Since the MR&T project was established, less than $11 billion has 
been invested. This investment provides benefits far beyond their 
actual cost to the taxpayer by offering protection to the 4 million 
citizens, 1.5 million homes, 33,000 farms, and countless vital 
transportation routes from destructive floods.
    With the help of the Congress, great progress has been made in the 
Mississippi River Valley over the years, but there is still much to be 
done, and because of that, we urge the Congress to increase funding to 
COE in fiscal year 2012, to ensure that COE is not forced to halt or 
delay contracts for levee construction essential to the well-being of 
this Nation. It is vital that the MR&T project(s) be completed at the 
earliest possible date. This can only be accomplished through adequate 
funding and repeal of the mandate for contracts to be fully funded 
prior to the beginning of construction.
                                 ______
                                 
 Prepared Statement of the Board of Levee Commissioners for the Yazoo-
                           Mississippi Delta

    Is this Nation's heartland worth preserving? Will the richest and 
most fertile farmland in the world be allowed to simply wash away? Are 
the lives and livelihoods of America's bread basket somehow now less 
important?
    These are the questions we must ask ourselves even in this time of 
great economic uncertainty, with opinions and counter-opinions churning 
and Americans seemingly divided as surely as this continent's greatest 
river bisects it.
    And after asking them, then we must remember that some truths 
really are self-evident.
    As we move forward with what we realize necessarily must be a new 
approach to flood control and its funding in the years ahead, we urge 
you not to lose sight of what has been the enormous success of the 
Mississippi River and Tributaries (MR&T) project, a project which has 
made life as we know it in middle America possible. The land in and 
around the Mississippi River Valley has proved to be the most bountiful 
on Earth. Not only is it home to the salt-of-the-Earth men and women 
who populate it, but it is also the producer of an increasingly 
important slice of the U.S. export pie--the food and fiber that clothe 
this country and the rest of the world.
    We understand the political and economic reality which dictates 
that now, more than perhaps ever before, every Federal dollar is 
critical and every expenditure must be prioritized. But then what 
priority of government is more critical than the protection of its 
people and the wealth that they produce?
    The administration proposes fiscal year 2012 funding for the MR&T 
project, one of our great continuing successes, with an almost 
unprecedented benefit-to-cost ratio, at $210 million, once again less 
than the Congress appropriated last year and substantially less than 
the Corps of Engineers' (COE) capability. But in such matters the 
founding fathers saw fit to give the Congress the last word, and so we 
urge you to fund the MR&T umbrella of needed public works at COE's 
capability level of $335 million.
    Honorable Members of Congress, there is a simple truth in our 
region of this country: The Mainline Mississippi River Levee makes life 
and development possible within the Mississippi Delta. Therefore it is 
nothing less than our duty to ask you to fund Mississippi River levees 
construction at $77.73 million and their maintenance at $15.781 
million. A paramount priority to our levee board is the Upper Yazoo 
Projects which we sponsor, not only a much needed endeavor, but a rare 
one, as well, in that it faces no environmental opposition. We urge you 
to advance its completion in the amount of $14.2 million.
    Mississippi's four flood control reservoirs have marked another 
MR&T project success, but it concerns us that they are aging, and we 
request the appropriation of $34.759 million for their continued 
maintenance.
    Also critical to us is the Delta Headwater Project, which helps to 
prevent our Delta streams from filling with eroded soils from the 
hills. We ask that it be funded at $23.2 million.
    We would also request that these other pieces of the flood control 
puzzle in our area be funded as follows:
      Channel Improvements.--$73.270 million;
      Big Sunflower River.--$2.5 million;
      Main Stem.--$25,000;
      Yazoo Basin Reformulation.--$1.2 million;
      Channel Maintenance.--$89.936 million;
      Channel Improvement Dredging.--$18.029 million;
      Channel Improvement Dredging--Memphis.--$12.430 million;
      Channel Improvement Dredging--Vicksburg.--$5.023 million;
      Revetments and Dikes.--$71.907 million;
      Big Sunflower Maintenance.--$985,000;
      Main Stem Maintenance.--$6.248 million;
      Tributaries.--$1.286 million; and
      Whittington Auxiliary Channel.--$494,000.
    And finally, Members of Congress, we have all been shocked and 
sickened by the death and devastation resultant from the recent 
earthquake in Japan. And so we would remind that the strongest recorded 
earthquake on the North American continent, occurred exactly 200 years 
ago--not in California, but along the New Madrid Fault in Missouri. Any 
such event today would make the amount of this needed funding request 
look like child's play, so we urge you to also allocate necessary 
attention and funding to earthquake research and preparedness.
                                 ______
                                 
   Prepared Statement of the Board of Mississippi Levee Commissioners

    Mr. Chairman and members of the subcommittee: This statement is 
prepared by Peter Nimrod, Chief Engineer for the Board of Mississippi 
Levee Commissioners, Greenville, Mississippi, and submitted on behalf 
of the Board and the citizens of the Mississippi Levee District. The 
Board of Mississippi Levee Commissioners is comprised of seven elected 
commissioners representing the counties of Bolivar, Issaquena, Sharkey, 
Washington, and parts of Humphreys and Warren counties in the Lower 
Yazoo Basin in Mississippi. The Board of Mississippi Levee 
Commissioners is charged with the responsibility of providing 
protection to the Mississippi Delta from flooding of the Mississippi 
River and maintaining major drainage outlets for removing the flood 
waters from the area. These responsibilities are carried out by 
providing the local sponsor requirements for the congressionally 
authorized projects in the Mississippi Levee District. The Mississippi 
Levee Board and the Mississippi Valley Flood Control Association 
support an appropriation of $335 million for fiscal year 2012 for the 
Mississippi River and Tributaries (MR&T) project. This is the minimum 
amount that we consider necessary to allow for an orderly completion of 
the remaining work in the Valley and to provide for the operation and 
maintenance, as required, to prevent further deterioration of the 
completed flood control and navigation work.
    It is apparent that the administration loses sight of the fact that 
the MR&T project provides protection to the lower Mississippi valley 
from waters generated across 41 percent of the continental United 
States. These waters flow from 31 States and 2 provinces of Canada and 
must pass through the Lower Mississippi Valley on its way to the Gulf 
of Mexico. We will remind you that the MR&T project is one of, if not 
the most cost-effective project ever undertaken by the U.S. Government. 
The foresight of the Congress in their authorization of the many 
features of this project is exemplary.
    The many projects that are part of the MR&T project not only 
provide protection from flooding in the area, but the award of 
construction contracts throughout the Valley provides assistance to the 
overall economy of this area. The employment of the local workforce and 
purchases from local vendors by the contractors help stabilize the 
economy in one of the most impoverished areas of our country.
    We are concerned about the ``earmark moratorium'' that the Congress 
has adopted for the next 2 years. Basically the Congress has 
essentially given up their right to appropriate money. They have 
relinquished this right to the Office of Management and Budget (OMB). 
OMB always provides a budget that undercuts our projects in the MR&T 
project because they know that the Congress will provide 
``congressional adds''. Unfortunately people think that the 
``congressional adds'' for the MR&T project are ``earmarks''. 
``Earmarks'' account for less than 1 percent of the entire Federal 
budget, but it is these ``earmarks'' that provide money for much-needed 
and essential projects and provide jobs for the economy. The stimulus 
money spent the past 2 years created jobs, built projects and 
stimulated the economy. This ban on ``earmarks'' will cause many 
projects to be stopped, jobs will be lost and the economy will fall 
right back into a recession. The Congress needs to define what an 
``earmark'' is and they need to be able to do ``congressional adds'' 
for our projects.
    Thanks to the additional funding provided by the Congress over the 
last several years over and above the administration's budget, work on 
the Mainline Mississippi River Levee Enlargement Project is continuing. 
Of the original 69 miles of deficient levees in the Mississippi Levee 
District, 32 miles of work have been completed and 8.1 miles are 
currently under contract. We are requesting $77.73 million for 
construction on the mainline Mississippi river levees in the Lower 
Mississippi Valley Division which will allow the Vicksburg and Memphis 
districts to keep existing contracts on schedule and award contracts to 
avoid any future unnecessary delays in completing this vital project. 
We are all well aware that the Valley some day will have to endure a 
Project Flood, we just don't know when. We must be prepared.
    The President's fiscal year 2011 budget did not include funding for 
any construction projects within the Yazoo Basin. This action is 
especially difficult to understand during a time when our Nation needs 
an economic boost. These are all projects authorized and funded so 
wisely by the Congress. All of these projects are encompassed in the 
footprint of the Delta Regional Authority, an area recognized by the 
Congress as requiring special economic assistance to keep pace with the 
rest of our great Nation. We can not lose sight of the fact that all of 
these projects are required to return more than a $1 in benefits for 
each $1 spent.
    The recommended plan for the Yazoo Backwater Project includes a 
pump that will lower the 100-year-flood event by 4.5 feet thereby 
reducing urban and rural structural damages, providing benefits to the 
remaining agricultural lands, and reducing the frequency and duration 
of floods. The plan also includes reforestation easements to be 
purchased on up to 55,600 of existing agricultural land which will 
provide benefits in every environmental category--wetlands, 
terrestrial, aquatics, and waterfowl resources as well as vastly 
improving water quality. This is a model project that should be the 
standard for future public works projects in the United States. On 
August 31, 2008, the Environmental Protection Agency (EPA) wrongly used 
its authority under section 404(c) of the Clean Water Act (CWA) to veto 
the Yazoo Backwater Project even though it is exempt by section 404(r) 
of the CWA. The Mississippi Levee Board is currently engaged in a 
lawsuit against EPA asking the Federal court to determine if this 
project is indeed exempt from an EPA 404(c) veto by the exemption in 
section 404(r) of the CWA. The administration has ordered the 
cancellation of $57 million in reserves for the Yazoo Backwater 
Project. If we lose this money, we will have to start from scratch with 
the appropriations cycle. Please do everything you can to keep the $57 
million for the Yazoo Backwater Project and prevent this cancellation 
from happening. These funds will allow COE to begin acquisition of the 
reforestation easements and initiate the award of the pump supply 
contract. These funds were appropriated to solve flooding in the South 
Mississippi Delta, therefore, they should be used to alleviate flooding 
in the Mississippi South Delta.
    We are requesting $4.575 million for the Yazoo Backwater less Rocky 
Bayou Project. This money will be used to start the Environmental 
Impact Statement for the Yazoo Backwater Levee Enlargement Project. 
This levee is designed to overtop during a project design flood, but it 
needs to be raised 7 feet to get to the required elevation. Today, this 
levee will not be sufficient if we get a flood on the Mississippi River 
greater than the 100-year event.
    Work on the Big Sunflower (Upper Steele Bayou) Project has proved 
to be very beneficial. The Steele Bayou Sedimentation Reduction Project 
has installed drop-pipe structures at headcut locations all along 
Steele Bayou. These control structures stop the movement of sediment 
into Steele Bayou. Sediment is bad for flood control and water quality. 
We are requesting $2.5 million to keep this project moving forward.
    Work on the Delta Headwaters Project has proven effective in 
reducing sediments to downstream channels. To discontinue this project 
will only diminish water quality by increasing sediment, reducing the 
level of flood protection to the citizens of the Delta and increasing 
required maintenance. We are requesting $23.2 million to continue this 
project.
    Maintenance of completed works can not be overlooked. The four 
flood control reservoirs overlooking the Delta have been in place for 
50 years and have functioned as designed. Required maintenance must be 
performed to avoid any possibility of failure during a flood event. We 
are asking for $6.841 million for Arkabutla Lake; $7.174 million for 
Enid Lake; $8.051 million for Grenada Lake; and $12.693 million for 
Sardis Lake.
    We are requesting $15.781 million for maintenance of the mainline 
Mississippi river levees in the Lower Mississippi Valley Division which 
will provide for repair of levee slides, slope repair, and repair of 
the gravel maintenance roadway which is so vital to access during high 
water.
    The Mississippi River and our ports and harbors need money for 
maintenance dredging. The Mississippi River carries tons of sediment 
every second. This sediment falls out in slack water areas such as 
entrances to our ports and harbors. The Greenville Port needs $1 
million and the Vicksburg Port needs $750,000 to perform annual 
maintenance dredging. This dredging is vital to keep these ports open 
during the low-water season when much of the farm harvest is ready to 
be transported.
    We are requesting $3.03 million for the Lower Mississippi Valley 
Division for Collection of basic data under general investigations. 
This money is used to monitor and collect water-quality samples at 
gaging stations located throughout the Mississippi Delta. With the 
emphasis on water quality, water quantity, and Total Maximum Daily 
Loads (TMDLs), we must be able to continue to collect good data on 
water quality so we can get a baseline established to be able to 
monitor and improve water quality in the Mississippi Delta. 
Improvements in water quality in the Mississippi Delta will translate 
into improved water quality in the Gulf of Mexico and help the gulf 
hypoxia issue.
    EPA has been given too much power under section 404(c) of the CWA 
which allows EPA to veto congressionally authorized projects. During 
the early 1990s, due to abuse of the 404(c) power by EPA, the Congress 
considered removing this authority from EPA. EPA has again invoked this 
veto power on the Yazoo Backwater Project. EPA is saying that you 
cannot lower the water level with a flood control project. By killing 
this project with 404(c) veto authority, EPA is drawing a line in the 
sand over the future of flood control in our great Nation. EPA has 
vetoed the Yazoo Backwater Project even though it was approved, 
authorized and funded by the Congress and exempt from a 404(c) veto by 
404(r). It is now time to again take up this issue and remove the 
404(c) veto power from EPA before they kill another flood control 
project that has been authorized by the Congress.
    The Council of Environmental Quality draft proposal of changes to 
the Principals and Guidelines for Federal agencies fails to establish a 
clear, concise, and workable framework to guide development of water 
resources projects. It is incoherent and inconsistent--and thus not 
implementable in a practical sense. It substantially fails to comply 
with the explicit directions in section 2031 of WRDA of 2007 as well as 
the large body of previous law and policy related to water resources. 
It is written so as to not require or even encourage use of proven 
analytical tools to distinguish among alternatives. It elevates 
environment considerations over economic benefits, social well-being 
and public safety. Because of these critical and extensive failings, we 
recommend that this effort be put aside and restarted from the 
beginning.
    As Members of Congress representing the citizens of our Nation who 
live with the Mississippi River everyday, you clearly understand both 
the benefits provided by this resource and the destructive force that 
must be controlled during a flood. On behalf of the Mississippi Levee 
Board, I can not express enough, our appreciation for your efforts in 
providing adequate funding over the last several years that has allowed 
construction to continue on our much needed projects and thank you in 
advance for your kind consideration of our requests for fiscal year 
2012.
                                 ______
                                 
        Prepared Statement of the City of Morro Bay, California

    The city of Morro Bay is providing testimony to the Senate 
Subcommittee on Energy and Water Development to respectfully request 
that funding of $2.5 million be included in the fiscal year 2012 budget 
for the Army Corps of Engineers (COE) to dredge the Entrance/Transition 
channels in Morro Bay Harbor and to fund a condition survey of the 
North Breakwater.
    During World War II COE designed and constructed a new harbor 
entrance at Morro Bay with two rock breakwaters. Since the initial 
construction, more than 60 years ago, the Federal Government has 
maintained the harbor entrance, breakwaters, and navigational channels. 
In fiscal year 1995, COE completed the Morro Bay Harbor Entrance 
Improvement Project to improve safety for commercial fishing and 
coastal navigation. The city of Morro Bay contributed almost $1 million 
in local cost share to this project.
    Since 1995 the Federal Government has funded maintenance dredging 
of Morro Bay Harbor entrance area every year and schedules a larger 
project to maintain the Morro and Navy Navigation channels every 3 to 5 
years, as those channels accumulate sediment at a slower rate than the 
entrance area.
    Below is a summary of dredging history for the federally designated 
navigation channels in Morro Bay.

------------------------------------------------------------------------
               Date                     Area dredged       Cubic yardage
------------------------------------------------------------------------
1997..............................  Outer entrance......          63,009
1998..............................  Entrance, main,              695,080
                                     Navy, Morro, and
                                     sand trap.
1999..............................  Entrance and                 134,234
                                     transitional
                                     channel.
2000..............................  Entrance and                 236,883
                                     transitional
                                     channel.
2001..............................  Entrance and                 180,467
                                     transitional
                                     channel.
2002..............................  Entrance, Navy,              868,483
                                     Morro, and sand
                                     trap.
2003..............................  Entrance and                 170,817
                                     transitional
                                     channel.
2004..............................  Entrance and                 155,708
                                     transitional
                                     channel.
2005..............................  Entrance and                 133,989
                                     transitional
                                     channel.
2006..............................  Entrance and                 196,237
                                     transitional
                                     channel.
2007..............................  Entrance and                 150,581
                                     transitional
                                     channel.
2008..............................  Entrance and                 140,789
                                     transitional
                                     channel.
2009..............................  Entrance and                 151,067
                                     transitional
                                     channel.
2010..............................  Entrance, main,              823,749
                                     Navy, Morro, and
                                     sand trap.
------------------------------------------------------------------------

    A condition survey of the North Breakwater has not been completed 
since 1986. Since that time Morro Bay Harbor was subject to effects 
from the San Simeon Earthquake of 2003, the Chilean Tsunami of 2010, 
and the recent Japanese Tsunami of 2011. In March 2011, the Morro Bay 
Harbor saw 9-foot surges and large waves at the entrance area during 
the Tsunami generated by a 9.0 earthquake centered in Japan. Due to the 
long period of time since the last condition survey and to the unusual 
stresses the breakwater has been subject to, we feel it is critical to 
complete this condition survey of the North Breakwater in fiscal year 
2012.
    Morro Bay Harbor is the only all-weather harbor of refuge between 
Santa Barbara and Monterey along the rough waters of California's 
central coast. Our Harbor directly supports almost 250 home-ported 
fishing vessels and marine dependent businesses. We provide critical 
maritime facilities for both recreational and commercial interests. 
Businesses that depend on the harbor generate $50,000,000 annually and 
employ more than 700 people. In addition to the home-ported commercial 
fishing vessels, Morro Bay Harbor serves as port for 15-25 additional 
fishing vessels either transiting the coast, or here to fish during 
certain seasons. More than 400 recreational vessels come through Morro 
Bay Harbor while transiting the California coast.
    The United States Coast Guard (USCG) maintains a 27-person National 
Security Base and Search and Rescue Station at Morro Bay Harbor, which 
provides Coast Guard services for the entire central California coast, 
including port safety coverage for the Diablo Canyon Nuclear Power 
Plant and Vandenberg Air Force Base.
    The California State Department of Fish and Game home ports their 
65-foot enforcement vessel Blue Fin in Morro Bay. The Blue Fin enforces 
Federal and State Fish and Game regulations from Monterey to the 
Channel Islands and out 200 miles. The Fish and Game Department has an 
agreement with USCG to assist them with homeland security within this 
area as well. The Blue Fin is also made available through mutual aid 
agreements to all other law enforcement agencies, for enforcement 
assistance and search and rescue operations. It is vital that these 
vessels be able to safely transit the Morro Bay Harbor entrance and 
navigate within the Harbor to perform their missions.
    The Morro Bay Harbor Patrol provides routine and emergency response 
to boaters within Morro Bay Harbor and responds to incidents as far as 
Montana de Oro to the south and Cambria to the north. The Morro Bay 
Harbor Patrol provides assistance to USCG, the Morro Bay National 
Estuary Program, the California Department of Fish and Game, the 
California Department of Parks and Recreation and San Luis Obispo 
County.
    In 2000 the California legislature designated Morro Bay and several 
other small ports along the California coast as ``Harbors of Safe 
Refuge''. This legislation recognizes the critical role many small 
harbors play in affording a safety zone for commercial and recreational 
vessels transiting the California coast.
    Morro Bay Harbor's configuration exposes the entrance to the open 
ocean and strong winter storms, creating swells and currents that 
constantly carry sand and sediment into the navigation channels. The 
Morro Bay National Estuary Program recognizes the need to maintain the 
navigational channels in the harbor not only for the safe access of 
emergency and fishing vessels, but also to maintain adequate tidal 
exchange for the health of the Morro Bay Estuary.
    Morro Bay is a city of 10,000 people, with a total annual operating 
budget of approximately $25 million. We are almost entirely reliant on 
tourism and a small fishing fleet for our revenue. The city simply 
cannot afford to maintain the harbor without continued Federal 
assistance. If the channels are not dredged, all of the past local and 
Federal investment will be lost. It is imperative that the federally 
constructed navigation channels, entrance area, and protective jetties 
be maintained on a consistent schedule.
    COE has the capability to execute $2.5 million in maintenance 
dredging operations and a North Breakwater condition survey for fiscal 
year 2012. We respectfully request that your distinguished subcommittee 
include $2.5 million in funds for Morro Bay to keep our harbor open and 
safe in all conditions, to provide a safe base of operations for USCG, 
California Department of Fish and Game, and the Morro Bay Harbor 
Patrol, and to protect the health of the Morro Bay National Estuary.
    Thank you for your actions and support, and for the opportunity to 
present these requests to your subcommittee on behalf of the citizens 
of the city of Morro Bay.
                                 ______
                                 
               Prepared Statement of EnviroScience, Inc.

    To the honorable members of the Senate Subcommittee on Energy and 
Water Development: I am writing in support of continued, and indeed, 
expanded appropriations for the Corps of Engineers (COE) Aquatic Plant 
Control and Research Program (APCRP). My company EnviroScience, Inc. is 
a small environmental consulting firm engaged in the practical control 
of aquatic invasive plant species throughout the United States. For 
more than a decade, EnviroScience, its clients and the entire aquatic 
plant industry has benefitted from the research and technology transfer 
functions carried out by this COE program.
    Although I understand you are faced with complex and difficult 
decisions with regard to our Nation's budget, continued funding of this 
program and the research activities of the APCRP is critical to the 
fight against aquatic invasive species which I believe is one of the 
most important environmental issues our country faces over the next 
several decades. I see first-hand the tremendous impact these aquatic 
invasive plants have on recreational, public health, and property 
values. Every day I deal with lake communities whose property has been 
devalued by aquatic invasive plants like Eurasian watermilfoil, an 
invasive nuisance species that now infests countless thousands of 
waterbodies in every continental State.
    Exotic invasive aquatic plants like water chestnut, Eurasian 
watermilfoil, and hydrilla, are continuing to expand their ranges 
virtually unchecked. There is a critical need for more and better 
information on these species and appropriate control methods. In my 
opinion, the APCRP has been the best single source of this information 
over the years. APCRP also plays a critically important role in 
researching basic ecology, biological control, and native plant 
restoration. Unlike herbicide research, these are research areas that 
won't be supported by private industry, but are nonetheless very 
important in the ongoing struggle to understand and control these 
species.
    In all honesty, we haven't done a very good job of keeping these 
species out of our Nation's waterways, nor are State or Federal 
agencies able to fund the actual control of these species. At the very 
least, I believe the Federal Government should be a repository for 
current information on these invasive pests, and continue to sponsor 
and conduct research into environmentally sound control methods.
    In conclusion, I urge you to support funding for the APCRP program 
at a minimum level of $4 million per year and thereby help ensure that 
COE remains a frontline defense in our Nation's fight against these 
unwanted invaders.
                                 ______
                                 
        Prepared Statement of the Izaak Walton League of America

    The Izaak Walton League of America appreciates the opportunity to 
submit testimony concerning appropriations for fiscal year 2012 for 
programs under the jurisdiction of the subcommittee. The League is a 
national, nonprofit organization founded in 1922. We have approximately 
38,000 members and more than 250 local chapters nationwide. Our members 
are committed to advancing common sense policies that safeguard 
wildlife and habitat, support community-based conservation, and address 
pressing environmental issues. The following pertains to programs 
administered by the U.S. Army Corps of Engineers (COE).

  U.S. ARMY CORPS OF ENGINEERS, OPERATIONS AND MAINTENANCE, MISSOURI 
                                 RIVER

    The League joins the Missouri River Association of States and 
Tribes (MoRAST), among other groups, in urging the subcommittee to 
appropriate $72.89 million in fiscal year 2012, as requested by the 
President, for the Missouri River Recovery Program. With this funding, 
COE, U.S. Fish and Wildlife Service (FWS), States, and other partners 
can continue important ecosystem restoration efforts that are producing 
long-term ecological and economic benefits.
    The Missouri River basin encompasses land in 10 States covering 
one-sixth of the continental United States. The Missouri, America's 
longest river, is one of the most altered ecosystems on Earth. Although 
recovery and restoration efforts are on-going, much more needs to be 
done. League members, especially those in Iowa, Nebraska, and South 
Dakota, want to see the recovery efforts continue and expand.
    COE, FWS, and many State agencies have been working to restore 
habitat for fish and wildlife along the river. This work is critical 
for the Interior Least Tern and Pallid Sturgeon, listed as endangered, 
and the Piping Plover, listed as threatened, under the Endangered 
Species Act. The restoration efforts also benefit many other species of 
fish and wildlife throughout the region.
    Studies conducted by the FWS show that over twice as many fish 
species are utilizing the created shallow water habitat areas compared 
with the section of the river with a dredged channel. COE's study also 
shows that the emergent sandbar habitat projects have had tremendous 
response from nesting terns and plovers. These habitat restoration 
projects are working with the river--not against it.
    These projects also generate additional economic activity in 
communities along the river. Anglers, hunters, boaters, birdwatchers, 
and others have been using these areas proving the old adage ``if you 
build it, they will come.'' In a recent report, the Missouri Department 
of Conservation and the Nebraska Game and Parks Commission found 
recreational spending provides $68 million in annual economic impact to 
communities along the Missouri River from Yankton, South Dakota to St. 
Louis, Missouri. A South Dakota Game, Fish, and Parks study shows that 
recreational benefits from angling on the Missouri River account for 
more than $107 million in annual economic activity in the Dakotas and 
Montana. These projects are bringing more people to the river 
throughout the Missouri basin.
    In addition to the economic boost from tourism, restoration 
projects, including building sandbars, support job creation throughout 
the entire region. To perform this work, COE contracts with local 
construction companies, creating or maintaining jobs, and injecting 
dollars into local economies through purchases of materials, fuel, 
food, and lodging. With the funding requested, COE could readily 
implement more of these important economic and river restoration 
projects.
    Missouri River Authorized Purposes Study.--The League also urges 
the subcommittee to continue to provide $5 million for the Missouri 
River Authorized Purposes Study (MRAPS), and to oppose extraneous 
policy ``riders'' that would curtail or cancel this critical 
assessment. The MRAPS will, for the first time, review the eight 
authorized Missouri River project purposes established by the Flood 
Control Act (FCA) of 1944. This study will analyze the purposes in 
terms of what is best for the American taxpayer, the people within the 
entire basin, fish and wildlife, and today's economic values and 
priorities, rather than those of nearly 70 years ago.
    COE is working collaboratively with tribes, Federal and State 
agencies, and other stakeholders within the Missouri River Basin and 
along the Mississippi River on this historic study--this has never 
happened before.
    The eight authorized purposes--flood control, hydropower, 
recreation, fish and wildlife, irrigation, water supply, water quality, 
and navigation--have not been reviewed since the Congress passed the 
FCA in 1944. In essence, the Missouri is operating on a 67-year-old 
business plan. This review is urgently needed and long overdue for the 
American taxpayer.
    The Missouri River basin is very different today than what was 
envisioned in 1944. Some of the authorized purposes meet or greatly 
surpass expectations from decades ago. Currently, recreational uses of 
the river dramatically exceed original expectations while other 
purposes, particularly navigation, have fallen far short. In spite of 
these changes, river management mostly favors navigation. This outdated 
and unbalanced approach is especially in need of review when one 
considers that navigation is being maintained largely to accommodate 
one commodity. According to the General Accounting Office (GAO), sand 
and gravel accounted for 84 percent of total tonnage shipped by barge 
on the Missouri between 1994 and 2006. Moreover, GAO found that 54 
percent of all sand and gravel was transported for 1 mile or less. 
Today, in part because the purposes in the 1944 Flood Control Act have 
not been modernized, the river is being managed to move sand less than 
a mile rather than for more diverse and beneficial purposes.
    Continued full funding of MRAPS is a smart investment. A 
comprehensive review and accompanying changes will streamline future 
COE operational expenses. This will save tax dollars and bring Missouri 
River management into the 21st century.

    U.S. ARMY CORPS OF ENGINEERS, OPERATIONS AND MAINTENANCE, UPPER 
                           MISSISSIPPI RIVER

    The League is an active and long-time proponent of restoring the 
Upper Mississippi River (UMR) ecosystem. We have supported the 
Environmental Management Program (EMP) since its inception and continue 
to support this vital restoration program. We urge the subcommittee to 
provide $33.2 million for EMP in fiscal year 2012 as authorized by the 
Water Resources Development Act (WRDA). Although we are encouraged by 
the President's request for fiscal year 2012, pressing restoration 
needs on-the-ground require at least the full amount authorized for 
EMP.
    The League has also strongly expressed its opinion that the large-
scale navigation modifications included in the recommended plan for the 
Upper Mississippi Navigation and Ecosystem Sustainability Program 
(NESP), as authorized by the WRDA of 2007, have not been justified by 
COE and should not be pursued. Previous reviews by the National Academy 
of Sciences and the Assistant Secretary of the Army, Civil Works found 
that the navigation construction component of NESP was not economically 
justifiable. A report released last year by the Nicollet Island 
Coalition, of which the League is a member, provides additional 
evidence that proposed locks and dams in this region are not a good 
investment for American taxpayers. With this in mind, the League 
supports the administration's decision not to request funding for NESP 
in fiscal year 2012.
    The League has strong roots in the Upper Mississippi River region. 
Protecting the basin has been a key issue for our members since we led 
the fight to create the Upper Mississippi River Fish and Wildlife 
Refuge in 1924. The League has spearheaded efforts to reform the lock 
and dam navigation system to ensure that flows and habitat remain as 
natural as possible. We also work to promote sustainable agriculture 
practices and implement farm conservation programs to reduce polluted 
runoff. Our testimony reflects many decades of experience on the Upper 
Mississippi River and our direct 15-year involvement with the Upper 
Mississippi River--Illinois Waterway (UMR-IWW) navigation study.
    The Upper Mississippi River is one of the most complex ecosystems 
on Earth. It provides habitat for 50 species of mammals, 45 species of 
reptiles and amphibians, 37 species of mussels, and 241 species of 
fish. The need for ecosystem restoration is unquestionable. As COE 
correctly stated in its study of navigation expansion, this ecosystem 
is ``significantly altered, is currently degraded, and is expected to 
get worse.'' Researchers from the National Academy of Sciences have 
determined that river habitat is disappearing faster than it can be 
replaced through existing programs such as EMP, which was authorized at 
$33.2 million annually by the Congress in 1999, but has never received 
full appropriations. As habitat vanishes, scientists warn that many 
species will decline and some will disappear.
    Our Nation relies on a healthy Mississippi River for commerce, 
recreation, drinking water, food, and power. More than 12 million 
people annually recreate on and along the Upper Mississippi River 
spending $1.2 billion and supporting 18,000 jobs. More people recreate 
on the Upper Mississippi than visit Yellowstone National Park. Notably, 
barge traffic has remained static on the river for more than two 
decades with real declines in recent years.
    In assembling the UMR-IWW navigation study, COE recognized the 
critical need for ecosystem restoration and encouraged the Congress to 
invest approximately $130 million annually in Upper Mississippi River 
habitat restoration efforts. With this demonstrated need in mind, the 
League strongly encourages the subcommittee to prioritize investment in 
ecosystem restoration by appropriating $33.2 million for the EMP in 
fiscal year 2012. Appropriating additional funding for restoration will 
support economic development and job creation in communities along the 
UMR and provide long-term conservation and economic benefits for the 
region and the Nation.
    We appreciate the opportunity to submit this testimony and look 
forward to working with the subcommittee to strengthen the investment 
in ecosystem restoration and recovery along the Upper Mississippi and 
Missouri Rivers.
                                 ______
                                 
 Prepared Statement of the Mississippi Valley Flood Control Association

    The Mississippi Valley Flood Control Association respectfully 
requests that the sum of $335 million be appropriated in fiscal year 
2012 for the Mississippi River and Tributaries Project.
    The Flood Control Association was first organized in 1922 by a 
group of interested citizens from the States of Arkansas, Mississippi, 
and Louisiana. From that first meeting, held in Memphis, Tennessee, a 
delegation was selected to come to Washington in an attempt to convince 
both the Congress and the executive branch that the prevention of 
catastrophic floods in the lower Mississippi River valley was beyond 
the capabilities of the local people and was in fact too large for any 
group other than the Federal Government. This group of dedicated 
citizens was without success until the record flooding of 1927 swept 
through the Mississippi River valley with a fury of devastation not 
seen before. An unknown number of people perished, along with thousands 
of head of livestock and large numbers of many species of wildlife. 
Some 7 percent of all the productive land on this planet was under 
water for a period of almost 6 months. The Congress, after extensive 
hearings, passed the Flood Control Act of May 15, 1928, which was then 
signed into law by President Calvin Coolidge.
    The Flood Control Association then disbanded, acting under the 
erroneous assumption that the United States Government would provide 
whatever was needed to prevent flooding in the valley. In 1935 it 
became apparent that additional legislation was required and the 
Association, under the leadership of Senator John Overton from 
Louisiana, was reorganized. It has been in continuous and active 
existence since, some 76 years.
    We have been fortunate since 1935 to have as our president and two 
vice presidents Members of the United States Congress with Congressman 
Mike Ross from the State of Arkansas serving as our president and 
Senator Roger Wicker from Mississippi and Congressman Blaine 
Luetkemeyer from Missouri serving as our vice presidents.
    We are a nonprofit agency made up of levee boards, drainage 
districts, harbor and port commissions, States, cities and towns, 
including many other agencies and individuals that have an interest in 
the protection and betterment of the people and property in the 
Mississippi River Watershed, the third largest in the world. But we 
feel it is the greatest, because of its size coupled with its essential 
usefulness to the well-being of our Nation. In a few words we are an 
agency through which the local people may speak and act jointly on all 
flood control, bank stabilization, navigation, and major drainage 
problems.
    Never before have we seen our Nation faced with such huge public 
debts and budget deficits as we do today. In our daily life we are made 
aware of the gut-wrenching sadness of seeing homes foreclosed and jobs 
disappear. We know all those things but we also know that the country 
that is and has been for generations the bright light of freedom and 
prosperity, must not and cannot let its infrastructure deteriorate and 
fall into ruin; neither can we allow one of our vital forms of 
transportation to become underutilized or useless due to the lack of 
proper and necessary maintenance.
    Unfortunately today, as usual, you are considering a budget request 
from the executive department that has insufficient funding to prevent 
either of the cases just outlined. The only recourse we have is to 
request the Congress do as you have always done, add the necessary 
supplemental funds to protect the lives, property, and livelihoods of 
the citizens of this great river basin.
    Earlier in this statement it was said that the Mississippi River 
Watershed that provides drainage for 41 percent of the Nation, moves 
almost 1 billion tons of commodities--60 percent of our grain, 25 
percent of our petroleum products and 20 percent of the coal to fire 
our powerplants, was the greatest watershed on the planet because of 
its size coupled with its usefulness. Useful because the river has been 
controlled and improved beginning with the first levee for flood 
protection built in New Orleans, Louisiana, in 1717. Levees came early 
because ``Without flood control, nothing else matters.'' Over the years 
the Congress, the Corps of Engineers and the local people have worked 
together to make the Mississippi River Watershed, stretching from New 
York in the east to Montana in the west and from the Canadian border to 
the Gulf of Mexico, the greatest and the envy of the developed world.
    Our great country has always been a maritime nation, almost totally 
dependent during the earliest years on the oceans and unimproved 
waterways to move our commerce including, at that time in history, our 
people. Westward expansion used the rivers whenever possible, and many 
of the earliest construction projects in the new country were the 
building of canals connecting commercial waterways. Our national 
security and economic well-being has always, now more than ever, 
depended on the seas, lakes, and inland waterways that give us 
accessibility to every corner of our great Nation.
    All improvements, great or small, sooner or later require 
maintenance. We have been too lax in this great country with 
maintaining and improving our basic forms of transportation. We have 
not built new airports to keep up with the demand of our growing 
population nor have we improved and properly maintained those that we 
have. Our system of railroads is in such bad shape that we no longer 
even attempt to move human cargo by train except for a very few small, 
densely populated areas of the country. The interstate highway system 
that we constructed more than 50 years ago was a great source of pride, 
but we failed again to properly maintain it, and now we are paying a 
tremendous price to keep it functioning. A great majority of our 
waterway improvements, including our locks and dams and flood control 
facilities, are well past their design life. Soon we will find 
ourselves in emergency mode, repairing and replacing failures. This 
will be very expensive and an economic disaster. Farmers will be 
especially hard hit, with no efficient and economical way to transport 
their crops to international markets.
    Our principal, but certainly not our only concern, is with the 
funding of the Mississippi River and Tributaries (MR&T) project. This 
is a very unique project that was conceived and developed with 
consideration for the functional relation between all its parts and the 
whole. It is a project that covers all aspects of development in the 
Mississippi River valley below the vicinity of Cape Girardeau, 
Missouri, from flood control to navigation to environmental protection 
and enhancement. The MR&T project was well-planned, well-organized, 
well-engineered, well-constructed and, until recently, well-maintained. 
Unfortunately it is not yet completed, and adequate funding from the 
Congress is imperative if it is to be completed and properly 
maintained. If, because of inadequate funding and uncalled for delays 
due to countless and repetitive studies and misguided lawsuits by the 
misnamed and misled environmentalists, the lower reaches of the 
Mississippi River are not usable by commercial boats and barges and 
sea-going ships, then no amount of improvement on the upper reaches of 
the Mississippi River can have any favorable effect. ``Without flood 
control nothing else matters.''
    One of the major opportunities that we have to increase the wealth 
of our Nation is to continue the improvement and development of our 
major river systems. As noted, the major system is the Mississippi 
River Watershed. For that reason we are here today to request that the 
Congress do what it has done since 1928. That is, to appropriate 
sufficient supplemental funds, allowing COE to continue what the 
Congress has directed them to do. We are not talking about ``earmarks'' 
or pork barrel politics. We are talking about funds to keep our 
navigation channels open and to provide necessary dredging in order 
that our smaller but no less critical ports may continue to function; 
funds to continue the ongoing work to bring miles of levee sections 
that are deficient in either grade or section up to the design required 
to protect our citizens against the ``greatest possible flood''; and 
funds to bring our bank stabilization program to completion in the most 
efficient manner, both economically and environmentally.
    The Executive Committee of the Mississippi Valley Flood Control 
Association has carefully studied the President's budget request for 
fiscal year 2012. We have arrived at the unanimous conclusion that the 
required appropriation for the MR&T project is $335 million, just to be 
reasonably assured that the goals of navigation, flood control, levee 
improvement and bank stabilization are met; nothing more, nothing less.
    In a special message to the Congress on flood control in the 
Mississippi Basin, dated July 16, 1947, President Harry S Truman began 
with the following in his opening sentence, ``the major opportunity of 
our generation to increase the wealth of the Nation lies in the 
development of our great river systems.'' Later on in his message 
President Truman used these words, ``we must never forget that the 
conservation of our natural resources and their wise use are essential 
to our very existence as a Nation. The choice is ours. We can sit idly 
by--or almost as bad, resort to the false economy of feeble and 
inadequate measures--while these precious assets waste away. On the 
other hand, we can, if we act in time, put into effect a realistic and 
practical plan which will preserve these basic essentials of our 
national economy and make this a better and a richer land.'' President 
Truman was speaking about the MR&T project in this last quote. And 
these words are still true today. On July 31, 1947, President Truman 
approved appropriations bills, including supplemental provisions for 
flood control on the MR&T project in fiscal year 1948 of $250 million. 
And that was in 1948 dollars.
    We have attached a detailed breakdown of the requested funds of 
$355 million for the MR&T project for fiscal year 2012.

   MISSISSIPPI VALLEY FLOOD CONTROL ASSOCIATION FISCAL YEAR 2012 CIVIL
 WORKS REQUESTED BUDGET MISSISSIPPI RIVER AND TRIBUTARIES APPROPRIATONS
                        [In millions of dollars]
------------------------------------------------------------------------
                                                            Fiscal year
                      Project/study                        2012 request:
                                                           $335 million
------------------------------------------------------------------------
 
                   MR&T INVESTIGATIONS
 
Collection and study of basic data......................             500
Memphis Metro Storm Water Management, TN [FEAS].........             100
                                                         ---------------
      TOTAL INVESTIGATIONS..............................             600
                                                         ===============
                    MR&T CONSTRUCTION
 
Atchafalaya Basin, LA...................................           6,300
Atchafalaya Basin Floodway System, LA...................           1,900
Channel Improvement, AR, IL, KY, LA, MS, MO, AND TN.....         111,570
Mississippi River Levees, AR, IL, KY, LA, MS, MO, AND TN          58,980
Yazoo Basin, Upper Yazoo Projects.......................           5,000
                                                         ---------------
      TOTAL CONSTRUCTION................................         183,750
                                                         ===============
                    MR&T MAINTENANCE
 
Atchafalaya Basin, LA...................................           1,468
Atchafalaya Basin Floodway System, LA...................              42
Baton Rouge Harbor, Devils Swamp, LA....................              48
Bayou Cocodrie & Tributaries, LA........................           2,145
Bonnet Carre, LA........................................          61,230
Channel improvement, AR, IL, KY, LA, MS, MO, AND TN--             32,032
 TOTAL..................................................
Channel Improvement--Dredging...........................          21,141
Channel Improvement--Revetments and Dikes...............          48,398
Greenville Harbor, MS...................................              18
Helena Harbor, AR.......................................             122
Inspection of completed works...........................           1,350
Lower Arkansas River, North Bank, AR....................             223
Lower Arkansas River, South Bank, AR....................             150
Lower Red River--South Bank Levees......................             377
Mapping.................................................           1,202
Memphis Harbor McKellar Lake, TN........................           1,394
Mississippi Delta Region--Caernarvon, LA................             438
Mississippi River Levees, AR, IL, KY, LA, MS, MO, AND TN           7,951
Old River control structure, LA.........................           6,954
Red-Ouachita Basin Levees, AR and LA....................  ..............
St. Francis River and Tributaries, AR AND OR............           4,174
Tensas Basin, Boeuf and Tensas Rivers, AR AND LA........           1,884
Tensas Basin, Red River Backwater, LA...................           2,473
Vicksburg Harbor, MS....................................              32
Wappapello Lake, MO.....................................           4,167
White River Backwater, AR...............................             896
Yazoo Basin, Arkabutla Lake, MS.........................           4,606
Yazoo Basin, Big Sunflower (Bogue Phalia), MS...........             185
Yazoo Basin, Enid Lake, MS..............................           4,386
Yazoo Basin, Greenwood, MS..............................             807
Yazoo Basin, Grenada Lake, MOS..........................           4,511
Yazoo Basin, Main Stem, MO..............................           1,019
Yazoo Basin, Sardis Lake, MS............................           5,687
Yazoo Basin, Tributaries, MS............................             967
Yazoo Basin, Will M. Whittington Auxiliary Channel, MS..             378
Yazoo Basin, Yazoo Backwater, MS........................             517
Yazoo Basin, Yazoo City, MS.............................             731
                                                         ---------------
      TOTAL, MAINTENANCE................................         150,650
                                                         ===============
      TOTAL, MR&T.......................................         335,000
------------------------------------------------------------------------

                                 ______
                                 
  Prepared Statement of the Missouri River Association of States and 
                                 Tribes

    We are requesting your support for three items in the fiscal year 
2012 budget for the U.S. Army Corps of Engineers (COE), related to the 
Missouri River Basin. These include:
  --$5 million to continue funding for the Missouri River Authorized 
        Purposes Study;
  --$72.888 million to continue implementation of the Missouri River 
        Recovery Program; and
  --$7 million to increase the operations and maintenance budget for 
        the Northwestern Division, Omaha District, for protection of 
        cultural and historical sites impacted by the operation of the 
        Missouri River Mainstem Reservoir System.
    The Missouri River Association of States and Tribes (MoRAST) is an 
association of representatives of the Governors of the States of 
Wyoming, Montana, North Dakota, South Dakota, Nebraska, Iowa, and 
Kansas and many of the American Indian tribes in the Missouri River 
Basin. MoRAST is interested in the proper management and protection of 
natural resources, including water resources, fish and wildlife, and 
other related issues of interest to the States and tribes in the basin, 
including cultural resources. The programs and operations of COE are 
very important to our members, especially due to the legal 
responsibilities of the States and tribes related to water and the fish 
and wildlife resources in the basin, as well as the trust 
responsibilities of COE to the tribes. The following paragraphs provide 
detailed information regarding the bases for our support of the three 
items referred to above for fiscal year 2012 budget of COE, as outlined 
below:
      Funding for the Missouri River Authorized Purposes Study 
        (MRAPS).--MoRAST strongly supports the appropriation of $5 
        million to continue funding for MRAPS in fiscal year 2012.\1\ 
        The Congress appropriated $4.483 million in fiscal year 2010. 
        MRAPS was authorized to study the Missouri River Projects under 
        the 1944 Flood Control Act (FCA) to determine whether changes 
        to the purposes and existing Federal infrastructure may be 
        warranted. The study was authorized for a total cost of $25 
        million at Federal expense. This study does not duplicate any 
        previous study.
---------------------------------------------------------------------------
    \1\ The State of Iowa does not support the continued funding of the 
MRAPS study.
---------------------------------------------------------------------------
      The Missouri River Basin Project (Pick-Sloan Program) envisioned 
        a comprehensive system of projects and facilities in the 
        Missouri River basin constructed by both the Bureau of 
        Reclamation (BOR) and COE. The plan was only partially 
        completed and there continue to be water needs and related 
        issues in the basin, many of which are different than they were 
        in 1944. This study is important for many reasons. It has been 
        more than 66 years since the 1944 FCA was enacted and many 
        changes have occurred. The Missouri River Mainstem Reservoir 
        System continues to be operated in accordance with the 1944 FCA 
        for various authorized purposes including flood control, water 
        supply, water quality, irrigation, hydropower, navigation, 
        recreation, and fish and wildlife. However, while the 
        construction of the reservoir system and other works have 
        resulted in large project benefits from some of the authorized 
        purposes and much less for others, it has also created 
        substantial negative impacts on the economies and resources of 
        Indian tribes and others, as well as large environmental 
        losses, such as wetlands and habitat for a number of native 
        species, including three that are threatened or endangered.
      In summary, there have been many changes in the physical, 
        economic and environmental conditions that affect the Missouri 
        River and Tributaries (MR&T) projects and the basin since 1944. 
        COE needs $5 million for the study in fiscal year 2012. 
        However, COE has made significant progress with the 
        implementation of the study with the assistance of BOR and 
        other Federal agencies, as well as extensive input from States, 
        tribes, stakeholders, and the general public. COE held more 
        than 40 public meetings and tribal focus events throughout the 
        Basin and other areas to engage the public and collect 
        information. It has recently released a draft scoping summary 
        report and is currently holding feedback meetings to receive 
        comments on the draft report until April 30. Additional work is 
        needed to complete this process and the additional data 
        collection, analysis, and public engagement needed to complete 
        the study. Funds should be provided so the study can 
        objectively determine whether changes are needed to the 1944 
        FCA in order to best meet the contemporary needs of the 
        Missouri River Basin. Once the study is complete, the Congress 
        can decide whether or not the law should be amended, additional 
        project purposes added, and/or other changes made.
      Funding for Missouri River Recovery Program.--We strongly support 
        the $72.888 million recommended in the President's budget. It 
        is the minimum necessary for current year compliance with the 
        Biological Opinion (BiOP). The Missouri River Recovery Program 
        (MRRP) was established by COE as a collaborative program to 
        protect, recover and restore the Missouri River ecosystem and 
        its native species, including the endangered pallid sturgeon, 
        least tern, and piping plover. This program is authorized by 
        sections 3109, 3176, and 5018 of the Water Resources 
        Development Act (WRDA) 2007. Support for this program is 
        critical to ensure at least enough funding is available for 
        compliance with the BiOP, as amended in 2003. Compliance with 
        the BiOP also protects economic uses as failure to comply with 
        the BiOP could require changes to reservoir operations and 
        negatively impact other purposes.
      COE, various tribal, State, and Federal Cooperating Agencies and 
        the Missouri River Recovery Implementation Committee (MRRIC), 
        that includes these entities and various stakeholders, are in 
        the process of developing a collaborative study and plan known 
        as the Missouri River Ecosystem Restoration Plan (MRERP) to 
        identify and guide long-term actions required to restore 
        ecosystem functions, mitigate habitat losses, and recover 
        native fish and wildlife on the Missouri River, while seeking 
        to balance social, economic, and cultural values for future 
        generations.
      In addition to recovery and mitigation projects on the Missouri 
        River Mainstem, a project to provide for fish passage through a 
        diversion dam on the Yellowstone River near Intake, Montana, is 
        especially important to the recovery of the endangered Pallid 
        Sturgeon, as it will open up a large segment of free-flowing 
        river for the pallid to spawn in. Work on this important 
        tributary project is underway and is being implemented through 
        a cooperative effort of BOR, COE, U.S. Fish and Wildlife 
        Service (FWS), and the State of Montana.
      On a related matter, we also support removal of the prohibition 
        on Federal reimbursement of travel expenses for non-Federal 
        members of the MRRIC to attend its meetings. No new funds are 
        required for this action as it can be funded through the MRRP, 
        but this action is needed to improve the functionality and 
        chances for success of the MRRIC. The basin covers one-sixth of 
        the continental United States and travel to meetings in various 
        parts of the basin is expensive.
      Section 5018 of WRDA 2007 authorized the creation of MRRIC, but 
        prohibited Federal reimbursement of travel expenses for non-
        Federal members of the committee. The same section of WRDA 2007 
        also authorized the development of a MRERP, which is a part of 
        the MRRP. The failure to reimburse travel expenses hinders 
        participation, prevents balanced representation by tribal, 
        State, and nongovernmental members on the committee and is a 
        hardship for some MRRIC members. Lack of travel reimbursement 
        also makes participation by States and tribes difficult as 
        cooperating agencies for the MRERP study, especially during 
        these trying economic times and budget shortfalls for States, 
        tribes, and others.
      This issue could be resolved by either the inclusion of a 
        provision in the fiscal year 2012 budget bill to allow travel 
        reimbursement for attendance at MRRIC meetings or by amending 
        section 5018 of WRDA 2007 in a new WRDA bill to remove the 
        prohibition on Federal travel reimbursement. In any event, this 
        issue needs to be resolved soon so that all members can 
        participate, receive the background information, interact with 
        other participants, and provide meaningful recommendations to 
        COE and other agencies regarding MRRP as may be appropriate 
        through the MRRIC process.
      COE has a unique trust responsibility to the 28 Missouri River 
        Basin tribes and their participation in both MRRIC and MRERP 
        activities is vital to the success of efforts to restore the 
        ecosystem of the Missouri River consistent with the social, 
        cultural and economic needs in the Basin. The failure to fund 
        travel for the tribes to attend these meetings will not save 
        money and may result in delay or the need for more extensive 
        government-to-Government consultations if the tribes are not 
        able to participate adequately during the course of efforts by 
        MRRIC to make recommendations to COE regarding recovery 
        programs and the development MRERP.
      In summary, funding MRRP at a minimum of $72.888 million for 
        fiscal year 2012 is essential to ensure compliance with the 
        amended BiOP on the Missouri River and to implement the project 
        on the Yellowstone River near Intake, Montana, both of which 
        are of critical importance to the recovery of endangered 
        species and the restoration of the ecosystem. We also support 
        removal of the prohibition on Federal reimbursement of travel 
        for members of MRRIC to meetings of the committee to allow for 
        full participation of tribal, State and stakeholder members to 
        the committee.
      Funding To Protect Tribal Cultural Resources.--It is requested 
        that the Congress appropriate an additional $7 million for 
        fiscal year 2012 for the Omaha District, Northwestern Division, 
        COE for the stabilization of cultural and historic sites that 
        continue to be negatively impacted by the operation of the 
        Missouri River Mainstem Reservoir System. Funding for the 
        protection of cultural and historic sites within the Omaha 
        District has remained at $3 million for the past several years. 
        Past funding through COE operation and maintenance budget has 
        been woefully inadequate to address the ongoing damage to sites 
        from operation of the Missouri River Mainstem Reservoir System.
      COE has identified more than 400 historic and cultural sites 
        protected by Federal law that will be potentially damaged by 
        the current Annual Operating Plan, and the tribal nations in 
        the Missouri River Basin have identified many more sites that 
        could be impacted. However, there have only been funds to 
        mitigate damage to a few sites each year. COE has a unique 
        trust responsibility to the 28 Missouri River Basin Tribes 
        arising from the government-to-Government relationship between 
        the tribes and the U.S. Government, as well as an obligation 
        under section 106 of the National Historic Preservation Act, 
        applicable Executive orders, and other Federal laws, which 
        require COE to either halt any Federal undertaking that will 
        damage or destroy sites protected, or to mitigate the potential 
        damage.

                                SUMMARY

      We believe each of these programs is essential to the success of 
        efforts to properly manage and protect the natural resources of 
        the Missouri River Basin, satisfy COE trust responsibilities to 
        the Indian Nations in the basin and operate its projects in 
        accordance with applicable Federal law. We would appreciate 
        your help in providing adequate funding for these important 
        programs and projects. Please let David Pope, MoRAST executive 
        director, or Chairman Sando know if you have questions.
                                 ______
                                 
   Prepared Statement of the Moss Landing Harbor District, California

    Mr. Chairman and members of the subcommittee: Thank you for the 
opportunity for me, Linda McIntyre, as harbormaster and general manager 
of the Moss Landing Harbor District in California to submit prepared 
remarks to you for the record in support of the fiscal year 2012 Energy 
and Water Development Subcommittee regular appropriations measure. I 
appear on behalf of the board of harbor commissioners, the fishermen, 
oceanographers and scientists, and the citizens and marine dependent 
businesses of the Monterey community which we represent.
    We respectively request an additional $3.2 million for the U.S. 
Army Corps of Engineers (COE) operations and maintenance general 
account for scheduled authorized Federal channel maintenance as 
unanimously recommended by the California Marine Affairs and Navigation 
Conference.
    The board of harbor commissioners recognizes and expresses its 
gratitude to the Honorable Dianne Feinstein, a member of this 
subcommittee, and the Honorable Barbara Boxer, chairman of the 
Committee on Public Works and Transportation, and the other members of 
this subcommittee and staff, for their past efforts in funding 
operations and maintenance of the Moss Landing Harbor Navigation 
Project for more than 60 years. This authorized project is of 
significant national economic benefit and critical economic importance 
to the commercial fishing industry, university and private 
oceanographic research fleet, and Monterey County in the central coast 
region of the State of California.
    We are equally grateful to the chairman and the other members of 
this subcommittee and staff, for their continuing efforts in funding 
critically needed operations and maintenance funding of all our 
Nation's ports both large and small without discrimination.
    Moss Landing Harbor is perhaps best known as the gateway to the 
unique Monterey Bay with its Submarine Canyon and National Marine 
Sanctuary and the homeport for its oceanographic research tenants, 
including California State University Marine Consortium, Stanford 
University Hopkins Marine Institute (well-known to John Steinbeck fans 
of Cannery Row) and the Monterey Bay Aquarium Research Institute 
(MBARI) an affiliate of the Monterey Bay Aquarium--America's most 
visited cultural and educational site.
    Without continued maintenance dredging of the Federal channel at 
roughly 3-year intervals, none of these scientific, educational, 
environmental research, and vital commercial fishing activities could 
continue uninterrupted. The year 2012 represents the next required 
scheduled triennial dredging event. For this purpose we are requesting 
the addition of $3.2 million to the President's budget. We are advised 
COE's San Francisco District has the capability to execute this 
maintenance dredging cycle.
    For those who are unfamiliar with the geography of Monterey Bay and 
surrounding region, we invite you to come visit. Moss Landing is 
strategically situated approximately mid-point between Santa Cruz and 
Monterey Harbors on Monterey Bay. It shares a common entrance with 
Elkhorn Slough, a critical estuary of national significance.
    Construction of the project for navigation, Moss Landing, Monterey 
Bay, California was authorized in the Rivers and Harbors Act of March 
2, 1945, at an authorized depth of 15 feet. The congressional findings 
reflected the national security and postwar economic development 
interest in maintaining and increasing commercial fish production. In 
the lexicon of national economic development. The same is true today.
    In order to help harmonize the authorization and appropriations 
processes in the future and introduce an element of long-term planning 
and budgeting stability at COE's district level, we are seeking 
completion of a long-term dredged material management plan that would 
benefit both us and the Federal Government, and save everyone, 
especially the beleaguered U.S. taxpayer, money.
    That plan would also continue our use of several grandfathered 
dredged material disposal sites as the same land and seaward geographic 
factors that make us an indispensable element of the Monterey Bay 
ecosystem also limit our options for disposal with few if any landside 
alternatives.
    In the final analysis we are just a small harbor with a big problem 
not of our creation in search of a comprehensive solution. The first 
step is funding the long overdue maintenance. We cannot wait another 
year.
    We look forward to appearing before this subcommittee on future 
occasions to provide progress reports concerning our uphill and 
upstream efforts to both preserve navigation and improve the 
environment in Moss Landing Harbor, California.
    I am prepared to supplement my prepared remarks for the record in 
response to any questions that the chair, subcommittee members, or 
staff may wish to have me answer.
    Thank you Mr. Chairman and members of the subcommittee.
                                 ______
                                 
         Prepared Statement of the Ohio Lake Management Society

    To the honorable members of the Senate Subcommittee on Energy and 
Water Development: I am writing in support of continued and expanded 
appropriations for the United States Army Corps of Engineers (COE) 
Aquatic Plant Control and Research Program (APCRP). I write on behalf 
of the membership of the Ohio Lake Management Society, a citizen based 
nonprofit organization, founded in 1986, with mission to promote 
research and comprehensive management of lakes and reservoirs in Ohio.
    For the past three decades the Ohio Environmental Protection Agency 
has repeatedly reported to the Congress, in their Clean Water Act 
section 305(b) and section 314 documents, that the condition of Ohio's 
public lakes is being negatively impacted by nuisance growths of 
aquatic weeds, many of which are exotic species not native to the 
State. In 1996, the last year such data are available, the Ohio EPA 
reported in their Ohio Water Resource Inventory that recreation 
opportunities in 32 percent of 222 accessed public lakes in Ohio were 
threatened by nuisance growths of aquatic weeds. These data indicate 
that there exists a significant and widespread problem with aquatic 
weeds currently not addressed by Clean Water Act regulations passed by 
the Congress in 1972.
    Public lakes in Ohio are used by millions of citizens each year for 
recreation, thus the impact of excessive growths of aquatic weeds on 
recreational opportunities is significant. The Ohio Department of 
Natural Resources, in their 2008 Statewide Comprehensive Outdoor 
Recreation Plan, reported that 33 percent of households representing 
more than 11 million Ohio citizens enjoy recreational boating, an 
activity that demands proper control and management of aquatic weeds.
    The extensive problems with aquatic weeds that are being faced in 
Ohio are expected to be present in lakes nationwide, thus impacting 
recreation for millions of Americans who enjoy boating, fishing, and 
swimming. Given this situation, it is inappropriate that the Congress 
would eliminate funding for COE's Aquatic Weed Research program, which 
provides useful scientific information that affects so many citizens of 
the Nation, for so few per capita dollars spent.
    It is imperative that the United States Senate continue to fund the 
APCRP program so that scientific research from multiple perspectives 
(chemical, biological, mechanical, etc.) is conducted to determine the 
most cost effective ways to control the multitude of aquatic weed 
species, many exotic species, that now overpopulate the Nation's 
recreational lakes. The information gained from COE research is 
important to those that manage lake water quality to help them select 
the best aquatic weed control option for their specific lake situation. 
The data from the APCRP program are not only of value to State and 
local government agencies that manage public lakes, but also to the 
nationwide network of consulting firms that provide lake management 
services to citizens that own private lakes, many of which have 
problems with too many aquatic weeds.
    In conclusion, on behalf of the millions of citizens in Ohio that 
enjoy recreational activities on lakes and reservoirs, I urge you to 
support continued and expanded funding for the APCRP program to conduct 
research on the control of aquatic weeds at a minimum level of $4 
million per year. This action by the United States Senate will help 
ensure that COE will continue to provide vital scientific data to those 
that manage and control nuisance growths of plants in our Nation's 
waterways.
                                 ______
                                 
      Prepared Statement of the Stockton Port District, California

    We wish to thank you for this opportunity to provide congressional 
testimony by the Port of Stockton, California on behalf of its 
appropriations requests. The Stockton Port District is a California 
public agency created by the California State Legislature. The port is 
approaching its 80th year of operations.
    The port is located in the city of Stockton, California, which has 
an unemployment rate more than 21 percent, and nearly 18 percent for 
San Joaquin County (Source.--February 2011 data, California Employment 
Department). The port is the economic portal for the San Joaquin Valley 
and beyond. It is considered by many to be the economic engine that 
generates jobs and income for the Central Valley and the region.
    The port suffered significantly during the economic downturn but it 
is recovering rapidly with strong growth and jobs creation. We have 
more than 1,200 acres available for development, which is almost unique 
among California ports. In calendar year 2010, the Port achieved a 
throughput of 3.83 million tons. With the introduction of iron ore 
exports in January 2011, we expect total throughput to double in the 
very near future and expect export tonnages to surpass import tonnages 
within 2 years. We are expanding our rail capacity right now and during 
the next fiscal year, starting on July 1, 2011, we will spend another 
$1 million as well with a goal of being able to increase the throughput 
capacity of iron ore and coal unit trains from two per week to seven 
per week. This would equate to more than 3 million tons per year and 
provide for an export gateway to Asia that is only available at few 
ports situated on the west coast. For our bulk commodities, the 
availability of a year-round authorized channel depth of 35 feet or 
deeper is a very critical factor. Currently our iron ore ships have to 
top off downstream in deeper channels before export to Asia. It is 
inefficient. Nevertheless, we are rapidly fulfilling the President's 
National Export Initiative.
    The port and its waterway are of national significance as a 
``Marine Highway'' (M-580), a recent designation by the Department of 
Transportation (DOT). This is 1 of 18 marine highway corridors 
nationally. Additionally we are officially designated a ``strategic 
corridor of the future'' by DOT. The port is also designated as a 
reserve facility by the Department of Defense in time of need.
    Logistically, the port has direct access to two transcontinental 
rail lines. Direct rail-to-ship facilities exist at the port which is 
nearly unique for California ports. We are within 1 mile of Interstate 
5, which serves the entire west coast, north to south.
    We are highlighting and updating the three priority projects in our 
appropriations requests for your consideration.
  --The San Joaquin--Stockton Project is under the operations and 
        maintenance budget of the U.S. Army Corps of Engineers (COE). 
        It is our most urgent and highest-priority request. For the 
        past several years, COE has not been able to maintain the John 
        F. Baldwin and Stockton Ship Channels to the federally 
        authorized depth of 35 feet on a year-round basis. We have been 
        restricted to 31-33 foot channel depths for many months and 
        have been unable to do any dredging. This consistent problem 
        stems from insufficient funding, unpredictable shoaling 
        locations, and a very short dredging window. Unfortunately, our 
        only dredging window closes just before the winter when storm 
        flows create shoaling at unpredictable locations in the 
        channels. This has impaired the efficient movement of commerce 
        and sustained employment for the port, its tenants, and the 
        region.
    We have requested the COE for maintenance dredging to 37 feet plus 
1-foot overdraft to insure a year-round controlling depth of 35 feet. 
We believe COE supports our case through its expressed budget 
capabilities to the Congress. The port is requesting $12.5 million for 
fiscal year 2012. The President's fiscal year 2012 budget contains only 
$3.7 million for this project, which is not enough to assure a year-
round authorized depth. Bulk commodities vessels are very sensitive to 
any loss of authorized depth; shippers would incur several hundred 
thousand dollars of losses per vessel for each foot of channel depth 
blocked by shoaling.
  --The San Francisco Bay to Stockton Channel Deepening Project is in 
        the Construction General Budget of COE. This project would 
        deepen the John F. Baldwin Channel to 45 feet and the Stockton 
        Ship Channel to 40 feet. Our fiscal year 2012 request is for 
        $2.5 million to keep pace with a State of California 
        construction award of $17.5 million toward the non-Federal 
        share of the project. This State construction grant expires in 
        calendar year 2013 if construction is not started. No funds are 
        shown in the President's budget for fiscal year 2012. This 
        deepen marine highway project would significantly increase 
        goods movement efficiencies, especially iron ore and other bulk 
        exports, increase employment in an area where unemployment 
        rates are more than twice the national rate, and keep thousands 
        of trucks off of congested roadways, especially I-880, I-80, I-
        580, and I-205. One ship utilizing the ship channel can take 
        approximately 1,300 trucks off of congested highways between 
        the Central Valley and the San Francisco Bay Area. The economic 
        and environmental benefits, especially in air quality, are very 
        robust.
    A preliminary economic analysis by COE show a conservative National 
Economic Development (NED) average annual benefits of $73.5 million for 
this project. Not all the commodity movements, especially calendar year 
2011 iron ore exports, are included in this preliminary analysis. A 
very robust and positive benefit--cost ratio is expected once the NED 
costs are prepared. The Stockton Ship Channel is the primary access 
route for waterborne shipping from and into the Central Valley and 
beyond.
  --The Rough and Ready Island Storm Water Project would be in the 
        Construction General Budget of COE. This project would replace 
        an obsolete storm water system and include drainage detention 
        and lift facility on Rough and Ready Island. The project would 
        also reduce environmental problems, increase flood protection, 
        and create more usable land for development on the island. 
        Rough and Ready Island is one of the State's last remaining 
        large parcels of industrial property available for immediate 
        development. The amount of $3 million is requested and is 
        authorized pursuant to the Water Resources Development Act of 
        2007, Public Law 110-114. The project can be constructed within 
        a short time period and benefit employment in the immediate 
        area experiencing a very high rate of unemployment.
    We thank you for your consideration for the Port of Stockton 
requests.
                                 ______
                                 
        Prepared Statement of The Little River Drainage District

    Dear Senator Feinstein: My name is Dr. Sam M. Hunter, DVM of 
Sikeston, Missouri. I am a veterinarian, landowner, farmer, and 
resident of southeast Missouri.
    I am the president of The Little River Drainage District, the 
largest such entity in the Nation. Our District serves as an outlet 
drainage and flood control District to parts of seven counties in 
southeast Missouri. We provide flood control protection to a sizable 
area of northeast Arkansas as well. Our District is solely tax 
supported by more than 3,500 private landowners in southeast Missouri.
    My remarks will be directed toward the Mississippi River and 
Tributaries (MR&T) project and the St. Francis River Basin portion of 
the MR&T. Those funds when properly expended are investments yielding a 
return of substantial benefits to the American taxpayer throughout this 
Nation. They are used to prevent flooding to much of our valuable 
farmland, to industrial sites, and to upgrade our ever aging locks and 
dam system on our navigable streams which will prevent unscheduled lock 
closures, modernize our hydro-electric plants, and restore some of our 
environmental assets. MR&T authorized by the Congress in 1928 and still 
not completed is returning back to our Nation more than $25 for every 
$1 expended. This can be a job creating project for our Nation each 
year.
    We are fully aware of the financial situation of our Nation and we 
must all learn to do more with less and strive to reduce out national 
debt, balance the budget, and create more jobs for our citizens. There 
are projects and programs which are funded 100 percent or cost shared 
by our national treasury which need to be eliminated or at least 
reduced in scope. However, the MR&T project is not one of them. I will 
point out for you the reasons why.
  --This project has paid back to our Treasury more than $25 for every 
        $1 invested for damages prevented and benefits derived.
  --The project was authorized by the Congress almost 90 years ago. Our 
        Nation made a commitment to our citizens to improve a very 
        valuable resource of our Nation and then maintain it. We must 
        keep that commitment.
  --Investing and making funds available for the MR&T project will 
        create jobs, and it will bring additional funds into our 
        treasury.
  --It is the most environmental friendly form of transportation in our 
        Nation.
  --It is the most fuel-efficient means of moving commodities. For 
        instance consider 1 gallon of fuel moves 155 tons of freight by 
        truck; 413 tons by rail; and 576 tons by water.
  --It serves more than 75 percent of the population of this Nation and 
        touches 36 States.
  --It provides a means for our commodity producers and manufacturers 
        to compete fairly in a global market.
  --It provides protection from flooding to the many people who live 
        along the Mississippi River and its tributaries.
  --It provides much needed energy from hydropower and provides many of 
        our cities with drinking water.
  --It is used extensively each year for recreational purposes such as 
        boating, camping, fishing, sightseeing, and the like.
    The above is a short list of the benefits of the MR&T project which 
is a line item in the budget. This administration and administrations 
for the past 30 years each year submit budgetary amounts which are not 
sufficient to adequately maintain the channel as well as the locks and 
dams of which some are more than 75 years old. We must invest and we 
must improve this vital part of our infrastructure. One lock failure 
upstream can have a devastating effect downstream for each and every 
port and other users of this system.
    We currently spend less than $6 billion annually for maintenance 
and construction on our major waterways system whereas China and Brazil 
are spending $15 and $30 billion annually to modernize and expand 
theirs respectively. We must close that discrepancy so we can compete 
on the open markets.
    There is $210 million in the President's budget for fiscal year 
2012 for this project. This is totally unacceptable. This amount might 
pay the salaries of current employees without layoffs. We ask you to 
support funding of $335 million for fiscal year 2012 which will provide 
some funds for maintenance and a small amount for new construction. The 
Corps of Engineers (COE) capability is $550 million. The overall COE 
budget is less than $5 billion yet it is estimated we need $110-$200 
billion over the next 20 years just to modernize and keep our waterway 
system functional.
    Further, I would be remiss to not mention the hardships and lengthy 
delays due to the restrictive nature of policies and regulations being 
implemented by the Environmental Protection Agency (EPA) and other such 
agencies. EPA needs to be reduced in authority and the powers they have 
been asserting the past few years. Some of the policies and 
restrictions they are implementing are detrimental to the progress our 
Nation needs to be making. The delays, lengthy reviews, and unnecessary 
requirements are costly and causes many worthwhile projects from being 
completed.
    Also we ask you to review the mission and purposes of Federal 
Emergency Management Agency. The nationwide re-mapping of flood plains 
and zones is costly and having an adverse impact on those who live 
within our delta areas and who are protected by a well maintained levee 
system. Recent concessions made by Director Fugate will help but much 
more is needed.
    I wish to thank you very much for your time and kind attention and 
for taking the time to review the above. We would be very appreciative 
of anything this subcommittee can do to help us improve our 
environment, improve our livelihood, and improve the area in which we 
live and work which ultimately is good for America. We are also very 
appreciative of all this subcommittee has done for us in the past. We 
trust you will hear our pleas once more and act accordingly.
                                 ______
                                 
              Prepared Statement of The Nature Conservancy

    Mr. Chairman and members of the subcommittee: Thank you for the 
opportunity to present The Nature Conservancy's testimony on the fiscal 
year 2012 appropriations for the U.S. Army Corps of Engineers (COE) and 
Bureau of Reclamation. The Nature Conservancy is a nonprofit 
organization dedicated to the conservation of biological diversity. Our 
on-the-ground conservation work is carried out in all 50 States and in 
30 foreign countries and is supported by approximately 1 million 
individual members.
    We recognize the challenges of working in a constrained fiscal 
environment and that the Congress is making appropriation decisions 
differently than in years past. We also recognize the continued 
importance of our water resources and the benefits those resources 
provide to people, our economy, our environment, and the quality of 
life in our communities. Our focus is on the programs and investments 
needed to ensure those benefits are enhanced today and made sustainable 
for tomorrow.
    The Nature Conservancy supports the overall approach of building 
sustainability into the development and management of our Nation's 
water infrastructure, including the ecosystem restoration projects 
essential to ensuring that sustainability. These ecosystem restoration 
projects pay dividends through higher-quality water, natural flood 
control, sustaining commercial fisheries, and supporting economically 
important outdoor recreation; with impacts stretching out for decades 
to come, the projects and proposals that follow represent a very high 
return on investment.

                       SUSTAINABLE RIVERS PROJECT

    Sustainable Rivers Project (SRP) is an initiative launched by COE 
in partnership with the Conservancy to update decades-old water 
management practices to meet society's needs today and in the coming 
decades. The SRP is developing and demonstrating innovative approaches 
to provide for, and improve, water supply and flood risk management 
while restoring critical ecosystems. The President's budget includes 
two specific initiatives that support these efforts:
      Global Change Sustainability.--This project will allow COE to 
        advance a variety of new practices through several initiatives, 
        including SRP, working with State and other Federal agencies to 
        develop a national strategy to update drought contingency plans 
        and other initiatives to ensure a sustainable water supply and 
        adapt to projected changes in precipitation patterns and other 
        outyear conditions impacting the Nation's water supplies. The 
        Conservancy supports the $10 million in the President's budget 
        for this program.
      National Portfolio Assessment for Reallocations.--Launched in 
        fiscal year 2008, this assessment is a national effort to learn 
        from past water management techniques and then apply the 
        lessons learned more broadly. Part of this effort will develop 
        new methods and tools that can be transferred to COE projects 
        nationwide. The Conservancy supports the $571,000 included for 
        this program.

                     CORPS CONSTRUCTION PRIORITIES

    Hamilton City Flood Damage Reduction and Ecosystem Restoration.--We 
were pleased to see Hamilton City selected as 1 of 2 new construction 
starts in COE's fiscal year 2012 proposed budget. This project, 
developed with substantial assistance by the Conservancy, will increase 
flood protection for Hamilton City, California, while restoring 
approximately 1,500 acres of riparian habitat. Appropriations for the 
first phase will initiate construction of approximately 2 miles of 
levee, removal of one-half of the existing levee, and roughly one-third 
of the habitat restoration. The Conservancy strongly supports the $8 
million proposed in fiscal year 2012 to complete the first phase of 
construction.
    South Florida Ecosystem Restoration Program.--COE flood control 
projects, coupled with agricultural and urban development, have 
degraded the Everglades, one of the most diverse and ecologically rich 
wetlands ecosystems in the world. Water Resources Development Act 
(WRDA) 2007 authorized construction of the first projects under the 
Comprehensive Everglades Restoration Plan,and we encourage funding the 
Indian River Lagoon South, Picayune Strand, and the Site 1 Impoundment 
projects. The Conservancy supports the $162,724,000 proposed for the 
South Florida Ecosystem Restoration Program in fiscal year 2012.
    Upper Mississippi River Environmental Management Program.--
Authorized in 1986, this program supports coordinated habitat 
rehabilitation and enhancement projects in the Upper Mississippi River 
system. Over the 25 years of the program, COE has completed more than 
54 projects, benefiting more than 94,000 acres of aquatic and 
floodplain habitat. Currently, 22 projects in the program are in 
planning, design, or under construction. Completion of these projects 
will benefit an additional 70,000 acres of aquatic and floodplain 
habitat. The Conservancy supports the $18,150,000 proposed for the 
Environmental Management Program (EMP) in fiscal year 2012.
    Missouri River Fish and Wildlife Recovery Program.--Under this 
program, COE has completed 30 projects in the lower Missouri basin 
States to assist in the recovery of three listed species, restoring 
more than 40,000 acres of habitat. New authority was provided in WRDA 
2007 for the expenditure of funds in the upper basin States and for the 
Intake Dam project on the Yellowstone River in Montana. Construction of 
fish passage and screens at Intake Dam is a priority for the recovery 
of the endangered pallid sturgeon and other warm-water fish. The 
Conservancy supports the $72,888,000 proposed for the Missouri River 
Fish and Wildlife Recovery Program (MRRP) in fiscal year 2012, 
including funding to continue progress on the design and construction 
of fish passage and screens at Intake Dam.
    Chesapeake Bay Oyster Recovery.--Eastern oyster populations in the 
Chesapeake Bay have been decimated from historical levels by a century 
of overfishing, disease, and pollution. This project will help move the 
oyster population toward sustainable levels. The $5 million proposed 
for the fiscal year 2012 budget will create more than 60 acres of 
additional oyster habitat.
    Great Lakes Aquatic Nuisance Species Dispersal Barrier.--Invasive 
fish, plants, and invertebrates have had severe economic impacts to 
human uses and to freshwater biodiversity of the Great Lakes. 
Preventing further invasions through the waterway system is the most 
cost-effective way to protect the plethora of Federal lands and 
infrastructures threatened. The Nature Conservancy supports the budget 
request of $13.5 million in the construction account; $10,565,000 from 
operations and maintenance; and no less than $3 million in the 
Investigations account to expedite the Great Lakes and Mississippi 
River Interbasin Study.

                     CONTINUING AUTHORITIES PROGRAM

    We urge the subcommittee to continue its strong support of the 
section 1135: Project Modifications for Improvement of the Environment 
and section 206: Aquatic Ecosystem Restoration programs. Demand for 
these valuable programs continues to outstrip funding. The Conservancy 
supports adequate funding for these programs in the fiscal year 2012 
budget.
    Adequate funding will ensure support for two section 1135 projects, 
Spunky Bottoms (Illinois) and the Lower Cache River (Alaska). The 
Spunky Bottoms project is a model floodplain restoration and 
reconnection effort on the Illinois River that needs $750,000 to 
complete the Plans and Specifications phase and initiate construction. 
The Lower Cache River project seeks to restore natural meanders to the 
lower 7 miles of the river, improving bottomland hardwood forests, and 
expanding habitat for a variety of sportfish and mussels.
    The Conservancy also supports the request for $4,001,000 to 
complete design and initiate construction for a section 206 project for 
Emiquon East (Illinois), a floodplain restoration and reconnection 
project.

         U.S. ARMY CORPS OF ENGINEERS INVESTIGATION PRIORITIES

    Illinois River Basin Restoration Program.--This Federal-State 
partnership sustains the health of the entire Illinois River Basin 
through projects that restore habitats, species, and the natural 
processes that sustain them. It complements other Federal programs such 
as the Illinois Conservation Reserve Enhancement Program and 
Environmental Management Program of the Upper Mississippi, yet is 
unique in its basin-wide approach to restoration. The Conservancy 
supports the $400,000 funding proposed for this program in fiscal year 
2012.
    Puget Sound Nearshore Marine Habitat Restoration.--This study, when 
completed, will identify restoration and protection needs and 
opportunities in the nearshore regions of Puget Sound. The Sound 
supports the second-largest U.S. port (combined Ports of Seattle and 
Tacoma) for container traffic that has accounted for more than $70 
billion in foreign trade; it is an economic priority to ensure that 
Puget Sound maintains the ecological resiliency to sustain vital 
services for both people and nature. The Conservancy supports the 
proposed $400,000 in fiscal year 2012 to carry out this investigation.
    Willamette River Floodplain Restoration Study.--COE and the 
Conservancy are working together to identify ecological flow 
requirements downstream of Corps dams on the Willamette River and 
incorporate those flows into dam operations to improve fish and 
wildlife habitat and community flood protection. Additionally, this 
study will assess the potential for floodplain restoration in the 
Middle Fork and Coast Fork tributaries of the Willamette River to 
reduce flood damage while restoring natural wetlands and promoting 
ecosystem restoration. The Conservancy supports the $213,000 proposed 
in fiscal year 2012 to continue this study.
    Yellowstone River Corridor Comprehensive Study.--Funding these 
ongoing economic, fisheries, and wetlands studies will help ensure that 
the longest free-flowing river in the lower 48 States maintains its 
natural functions while supporting irrigation and other uses of its 
waters. The study will help determine the significance of the 
cumulative effects of water use on aquatic species and riparian 
hardwood forests, while guiding the establishment of beneficial 
management practices. The Conservancy supports the proposed $200,000 
for fiscal year 2012.

                         BUREAU OF RECLAMATION

    Upper Colorado River Endangered Fish Recovery and San Juan River 
Basin Recovery Programs.--These programs take a balanced approach to 
restore four endangered fish species--the pikeminnow, humpback chub, 
razorback sucker, and bonytail--that adhere to existing and State-
specific water law while facilitating each State's development of their 
Colorado River Compact allocation. These programs implement a range of 
basin-wide strategies, including improved management of Federal dams, 
river and floodplain habitat improvement, stocking of endangered fish, 
and management of non-native fish species. The Conservancy supports the 
proposed $6.2 million in fiscal year 2012 for the two programs.
    Platte River Recovery Implementation Program.--The program helps 
restore the four endangered or threatened species in the basin--
whooping crane, interior least tern, piping plover, and pallid 
sturgeon--while enabling existing water projects in the basin to 
continue operations. Specifically, the program is working to increase 
stream flows in the central Platte River at ecologically and 
economically important times; enhance, restore ,and protect lands for 
target bird species; and offset post-1997 depletions. The Conservancy 
supports the proposed $11,037,000 for this recovery effort in fiscal 
year 2012.
    Basin Studies and WaterSMART.--We support the request for the basin 
study programs and WaterSMART grant programs. These programs support 
sustainable water use and management by focusing on water conservation, 
reuse and recycling, and on environmental protection and restoration. 
We also support the proposed funding for the Bureau's environmental 
restoration work, including the programs in the California Bay Delta 
and Colorado River.

                       POTENTIAL ADDITIONAL FUNDS

    We recognize that previous year's appropriations for COE, including 
2010 and 2008 appropriations, have been higher than the President's 
fiscal year 2012 request. Should the subcommittee decide to appropriate 
more than the amount requested by the President, we would work with COE 
and partners to promote use of additional funds for other priority 
projects, including:
      Upper Mississippi and Illinois Navigation and Ecosystem 
        Sustainability Program.--This project would begin construction 
        on 11 ecosystem restoration and 5 navigation projects while 
        continuing planning and design work for lock expansion on the 
        Illinois and Mississippi Rivers.
      Cartersville Diversion Dam Fish Passage.--This project would 
        construct a fish passage at Cartersville Dam, allowing fish, 
        including the federally listed endangered pallid sturgeon, to 
        reach the upstream portions of the Yellowstone River.
      Connecticut River Watershed Study.--This project will restore 410 
        miles of river flow and thousands of acres of natural habitat 
        in the Connecticut River Basin. The study identifies dam 
        management modifications for environmental benefits while 
        maintaining beneficial human uses.
      White River Basin-Wide Comprehensive Study.--This project will 
        evaluate the impact of Federal impoundments, navigation, and 
        water withdrawals for agriculture, power generation, 
        modifications and a variety of other uses on the White River 
        basin and help determine ecological and human needs.
      Big Cypress Basin Watershed Study.--This project will restore the 
        natural river flow of Big Cypress Bayou to enhance the health 
        of Caddo Lake and the downstream wetlands, wetlands recognized 
        as globally significant by the Ramsar Convention.
      Long Island Sound Oyster Restoration.--This project will develop 
        a comprehensive plan for restoring oysters and other shellfish 
        in Long Island Sound to support the ecological and economic 
        well-being provided by a sustainable oyster fishery.
      Lower Mississippi River Resource Assessment.--Flood control and 
        drainage systems have accelerated erosion and habitat loss 
        along the Lower Mississippi River and its tributaries. Working 
        with the Department of Interior, the Corps will evaluate river 
        management, habitat, and public access to recommend actions for 
        addressing current and future needs.
      West Pearl River Navigation Study.--The aquatic communities of 
        the Pearl, West Pearl, and Bogue Chitto Rivers are severely 
        disrupted by old and disused navigation structures. This study 
        will examine the feasibility of removing them or repurposing 
        the structures to improve environmental and recreational 
        conditions.
      Thames River Basin Watershed Study.--This study for the Thames 
        River Basin ecosystem, including its tributaries to Long Island 
        Sound, will determine the research and management measures 
        necessary to improve the management of water control structures 
        in the basin.
      Middle Potomac River Watershed Comprehensive Study.--This study 
        will develop a comprehensive, multi-jurisdictional sustainable 
        watershed management plan for the Middle Potomac River 
        watershed, balancing the ecological functions and services 
        provided by the river with the human demands upon it.
    We appreciate the opportunity to present our comments on the Energy 
and Water Development appropriations bill.
                                 ______
                                 
   Prepared Statement of the Ventura Harbor, Ventura Port District--
                               California

    The President's fiscal year 2012 budget request for Ventura Harbor 
reflects a request of $2,805,000 for operation and maintenance for 
annual dredging activities within and around the Federal channel area 
of Ventura Harbor. Unfortunately, funding at that level does not 
accomplish the task.
    In fiscal year 2011, the Corps of Engineers (COE) was only able to 
complete the dredging of 300,000 cubic yards of material, leaving 
500,000 cubic yards of material not dredged, and remaining in place to 
be addressed next year. It is anticipated that more than 1 million 
cubic yards will need to be dredged in fiscal year 2012. Informal 
communications with COE suggest that fiscal year 2012 funding of 
$4,500,000 is required to meet the Ventura Port District's dredging 
requirements for the next fiscal year.
    The authorizing legislation for this request is Public Law 90-483, 
section 101. The appropriations history is:
      Fiscal Year 2004.--$2.9 million (Public Law 108-137);
      Fiscal Year 2005.--$2.9 million (Public Law 108-447);
      Fiscal Year 2006.--$2.6 million (Public Law 109-103);
      Fiscal Year 2007.--$2.6 million (Public Law 110-5);
      Fiscal Year 2008.--$3.4 million (Public Law 110-161);
      Fiscal Year 2008.--Emergency funding $5 million (Public Law 110-
        252) breakwater repairs;
      Fiscal Year 2009.--$2.8 million (Public Law 111-8);
      Fiscal Year 2010.--$6.1 million (Public Law 111-85) included 
        additional funds to complete breakwater repairs; and
      Fiscal Year 2011.--$2.8 million.
    It is noted that employment associated with the commercial fishing 
industry in the Port of Ventura area is directly related to the 
dredging activities of COE. In 2010, it is estimated that 71 million 
pounds of seafood product were unloaded at facilities associated with 
the Port of Ventura, accounting for significant employment in the area.

                          DEPARTMENT OF ENERGY

              Prepared Statement of the Altira Group, LLC

    Gentlemen: I am writing this letter in support of the Department of 
Energy Oil and Gas Research and Development Program and against the 
President's fiscal year 2012 budget request to zero out this program.
    Oil and gas is an essential part of our energy needs now and for 
the foreseeable future. As a Nation we should be supportive of efforts 
to extract and utilize our natural resources as cheaply and cleanly as 
possible. These efforts require the research and development (R&D) to 
identify new technologies and methodologies that are being actively 
supported by the Research Partnership to Secure Energy for America 
(RPSEA) program.
    The RPSEA program that administers these research dollars is 
supported with matched funding of 50 percent or more from industry and 
the technical support and liaison of thousands of scientists and 
engineers. It is an archetype for an efficient public private 
partnership and serves a unique place in fostering research at a pre-
commercial stage in the development of technologies that are not 
supported by venture capital or industrial research programs.
    The oil and gas industry is a technologically driven industry. 
However, oil and gas companies produce oil and gas as their end 
products, not technology, and they rely heavily on outside service 
companies. (This is particularly true for the U.S. Independents who 
develop most of our reserves.) Service companies, while good at 
deploying new technologies, are not adequately addressing our need for 
technological development. In addition, universities have not coped 
well with the boom bust industry patterns and are struggling to provide 
students adequate research opportunities. RPSEA has done a nice job of 
pulling these three constituencies together for relatively low cost and 
building a forward-looking R&D structure for the country.
    Ultimately the R&D supported by RPSEA will lead to additional oil 
and gas development (and royalties to government), jobs to many of the 
providers of these technologies and ultimately greater energy security 
at a lower price.
    Please note, I am a venture capitalist (former oil and gas 
geophysicist) and a former Board Member of RPSEA. Our firm focuses on 
energy technology. Altira's portfolio companies have not received money 
from this program.
                                 ______
                                 
 Prepared Statement of the American Association of Petroleum Geologists

    To the chairman and members of the subcommittee: Thank you for this 
opportunity to provide testimony on the importance and need for strong 
Federal research and development (R&D) activity in the areas of oil and 
natural gas, coal, and geothermal technologies. These activities reside 
in the Department of Energy's (DOE) fossil energy program (oil, natural 
gas, coal, etc.) and energy efficiency and renewable energy program 
(geothermal). They are an essential investment in this Nation's energy 
security.
    The American Association of Petroleum Geologists (AAPG) is the 
world's largest scientific and professional geological association. The 
purpose of AAPG is to advance the science of geology, foster scientific 
research, and promote technology. AAPG has nearly 34,000 members around 
the world, with roughly two-thirds living and working in the United 
States. These are the professional geoscientists in industry, 
government, and academia who practice, regulate, and teach the science 
and process of finding and producing energy resources from the Earth.
    AAPG strives to increase public awareness of the crucial role that 
geosciences, and particularly petroleum geology plays in our Nation's 
economic and social fabric.
    It is widely accepted that U.S. energy supplies will come from 
increasingly diverse sources over coming decades. New and alternative 
energy sources will supplement conventional energy sources to meet the 
Nation's growing energy needs at affordable prices. Diversity in energy 
supplies enhances U.S. energy security by reducing our reliance on any 
single energy source.
    Scientific and technological advances are necessary to ensure that 
this energy diversification occurs without economically damaging 
disruptions. This is very much in the public interest and a compelling 
reason why Federal R&D investment is needed.
    What is often misunderstood, however, is that this R&D investment 
cannot be solely focused on new and alternative energy sources. 
Ensuring the uninterrupted availability of conventional energy, which 
provides the bulk of the Nation's energy today, also requires new 
scientific insights and technological breakthroughs.
    In fact, our Nation is not facing a choice between conventional and 
alternative energy sources--a choice between yesterday's energy and 
tomorrow's energy--although that is how the debate is often framed.
    Oil, natural gas, and coal currently supply 83 percent of the 
Nation's energy. These resources are the foundation of our energy 
future. Upon this foundation we are now developing and deploying new 
and alternative energy sources.
    Our Nation's R&D choices must recognize the need to keep this 
foundation strong while also developing new energy sources for the 
future. Both of these tasks require sustained R&D investment.

                OIL AND NATURAL GAS TECHNOLOGIES PROGRAM

    AAPG strongly urges continued funding of the DOE oil and natural 
gas technologies programs, which the President has proposed for 
termination.
    Oil and natural gas supply 62 percent of our Nation's energy. Oil 
is the source of virtually all transportation fuels. Natural gas heats 
homes and businesses, generates electricity, is a chemical feedstock, 
and has potential for transportation systems. Supplying the oil and 
natural gas consumed today and in the future requires significant 
technological advancements.
    Several commonly overlooked trends in the oil and natural gas 
sectors support a Federal role in oil and natural gas technologies R&D:
  --The independent oil and gas producer is responsible for finding and 
        producing most U.S. oil and natural gas resources. According to 
        the Independent Petroleum Association of America (IPAA), a 
        trade association, independent producers produce 68 percent of 
        the Nation's oil, 85 percent of the Nation's natural gas, and 
        drill 90 percent of the Nation's oil and natural gas wells. The 
        median-sized independent producer is the epitome of American 
        small business.
  --Independents typically work on projects that are too small for 
        vertically integrated ``major'' oil and gas companies to 
        develop commercially. Technology is vitally important for 
        locating these resources underground, but these producers do 
        not have the capacity to conduct independent research.
  --Increasingly domestic oil and natural gas production is coming from 
        nontraditional (unconventional) resources, such as the Barnett 
        Shale of Texas or the Bakken formation of the Willison Basin. 
        These resources play a vital role in building our Nation's 
        energy future, and their development requires significant R&D 
        investment.
  --Federal R&D has historically provided support for the Nation's 
        universities and colleges, which have proven to be a rich 
        source of technological innovation. But as Federal support for 
        oil and natural gas technology development has waned, so has 
        the ability to conduct this type of research and train the next 
        generation of U.S. scientists and engineers. There is a serious 
        workforce shortage both in industry and government, and is the 
        subject of a new study by the National Research Council.
    The goal of a robust Federal R&D program in oil and natural gas 
technologies is to enable and encourage the environmentally responsible 
development of the Nation's petroleum resources on behalf of the 
American people. This includes conventional oil and natural gas, 
nontraditional resources, and emerging resources, such as methane from 
methane hydrates, which according to a recent study by the National 
Research Council ``could help to provide greater energy security for 
the United States and to help address future energy needs globally.''
    We request the Subcommittee on Energy and Water Development 
appropriate $100 million for oil and natural gas technology programs to 
be administered by DOE's Office of Fossil Energy to support research 
projects that target increased production of domestic oil and natural 
gas resources.

                              COAL PROGRAM

    The Nation's coal resources are essential to U.S. energy security. 
AAPG supports research and development funding for coal, including 
clean-coal technologies such as carbon capture and sequestration. AAPG 
urges the Congress to reject the President's proposed cuts to this 
program and provide funding of $393 million, equal to fiscal year 2010 
appropriations, for these activities.
    Again, these investments must be balanced. In evaluating the DOE 
coal program, I urge you to review the findings of the National 
Academy's report entitled ``Coal: Research and Development to Support 
National Energy Policy'', released in June 2007. The study finds that 
while there are significant uncertainties in U.S. coal reserve and 
resource estimates, there is sufficient coal at current consumption to 
last for more than 100 years.
    However, there is a real need for more ``upstream'' coal research 
to increase our understanding of the Nation's resource base. The study 
group observed that presently more than 90 percent of Federal R&D 
spending for coal is on the ``downstream'' side, focused on 
utilization, carbon capture and sequestration, and transport and 
transmission. Only 10 percent goes to resource and reserve assessment, 
mining and processing, environment/reclamation, and safety and health.

                 GEOTHERMAL ENERGY TECHNOLOGIES PROGRAM

    Geothermal energy is an important alternative energy resource that 
provides baseload power to the Nation's electrical grid. Significant 
expansion of geothermal power production may be possible through the 
development of enhanced or engineered geothermal systems, as well as 
mining heat from low-temperature, co-produced, and fluids in permeable 
sedimentary resources.
    AAPG supports the President's $101.5 million request for the DOE 
geothermal program.

                                SUMMARY

    Our Nation has the resources and capacity for a bright energy 
future. Realizing this future requires prudent R&D investment to supply 
the conventional energy sources we will rely on in coming decades, and 
the breakthroughs in new and alternative energy sources that will power 
the future. Thank you for the opportunity to submit this testimony.
                                 ______
                                 
           Prepared Statement of the American Gas Association

                           EXECUTIVE SUMMARY

    Natural gas is America's clean, secure, efficient, and abundant 
fossil fuel.
    The Department of Energy (DOE) should include in its research, 
development, and demonstration (RD&D) portfolio energy efficiency of 
natural gas equipment in commercial, residential, and industrial 
markets.
    DOE's Building Technologies Program should spend at least $12 
million of its budget on natural gas RD&D.
    DOE's Industrial Technologies Program should spend at least $30 
million of its budget on combined-heat-and-power (CHP) RD&D (request is 
$25 million) with activities in small- (below 20 KW), medium- and 
large-scale systems.
    DOE's Transportation Technologies Program should spend at least $30 
million on natural gas vehicle RD&D.

                              INTRODUCTION

    The American Gas Association (AGA), founded in 1918, represents 199 
local energy companies that deliver clean natural gas throughout the 
United States. There are more than 70 million residential, commercial, 
and industrial natural gas customers in the United States, of which 91 
percent--more than 64 million customers--receive their gas from AGA 
members. AGA is an advocate for natural gas utility companies and their 
customers and provides a broad range of programs and services for 
member natural gas pipelines, marketers, gatherers, international 
natural gas companies, and industry associates. Today, natural gas 
meets almost one-fourth of the United States' energy needs.
    On behalf of AGA, I urge you to support increased RD&D funding by 
the DOE on the natural gas end-use technologies, which are powered by 
an energy source that is domestically abundant, affordable, stable, 
highly efficient, and clean.
    To that end, we request a modest natural gas efficiency investment 
of $12 million in the Building Technologies Program, $30 million in the 
Transportation Program and $10 million for small-scale CHP, as well as 
supporting sufficient funding in the overall Industrial Program.
    At a time when there is growing instability in oil-producing 
regions such as North Africa and the Middle East, which has resulted in 
$100 per barrel--and rising--oil prices that threaten to derail our 
economic recovery, we believe that DOE needs to reassess its research 
and development (R&D) funding priorities. The DOE should join with us 
to develop highly efficient natural gas based appliances and systems. 
The natural gas industry, manufacturers and R&D partners will identify 
and capture financial support for this effort with 20 to 40 percent co-
funding expected, depending on the type of R&D performed.
    Currently, DOE spends hundreds of millions of dollars yearly on 
energy efficiency research, yet very little of this is directed toward 
energy efficient natural gas products. In particular, over the past 
several years there has been almost no Federal investment in natural 
gas technologies for residential and commercial buildings, the CHP 
Program in the Industrial Technologies Program has been dramatically 
reduced, and the R&D program for natural gas vehicles was totally 
eliminated in fiscal year 2006 through 2009. At a time when the value 
of natural gas for reducing carbon emissions is being recognized as 
never before, this is misguided.
    We feel that it is way past time for the office of EERE, whose 
mandate is furthering America's energy efficiency, to re-engage in 
developing energy efficient natural gas-based technologies. Combining 
our cleanest and most-efficient fuel with new, highly efficient end-use 
technologies is the best way to ensure our economic viability in an 
increasingly carbon-constrained environment.
    Such RD&D funding support must focus on highly efficient, superior 
performance technologies in which natural gas is used directly in the 
residential, commercial, industrial and transportation markets. Using 
natural gas directly in traditional end-use applications such as home 
heating, water heating and cooking, as well as increasingly in highly 
promising new applications such as natural gas vehicles and 
distributed--on-site--power generation, can save consumers millions of 
dollars, significantly reduce carbon emissions, and, given natural 
gas's domestic abundance, enhance our Nation's energy security.
    In particular, we urge a small fraction of the funding in the 
Building Technologies Program at DOE's Energy Efficiency and Renewable 
Energy Office be dedicated to natural gas based efficiency 
technologies. A $12 million level would equate to approximately 5 
percent of the appropriations for that office in 2010 and approximately 
2 percent of the President's 2012 buildings budget request.
    Specific Building program initiatives include:
Space Conditioning and Water Heating Efficiency and Operational 
        Improvements--$2.9 Million
    This effort will focus on laboratory testing, component and 
technology development and field testing of new gas space conditioning 
technologies and systems. The water heating R&D effort will improve 
performance and cost of components and assembly/installation of 
currently available or soon-to-be available systems for domestic or 
commercial water heating.
    These efforts will be in conjunction with gas utilities working 
closely with component and equipment manufacturers. In the commercial 
sector, the space conditioning effort will focus on developing new and 
improving current gas-based thermally activated (e.g., absorption) 
systems appropriate for space cooling and humidity/indoor air quality 
control in commercial buildings, while helping alleviate peak electric 
demand constraints. Combined space/water heating systems will also be 
developed and tested through laboratory and field testing.
  --Advance energy efficient technologies and systems for space and 
        water heating in existing single and multi-family residential 
        buildings and the light-commercial sector.
  --Improve efficiency and reduce cost of highly efficient condensing 
        gas furnaces and boilers that are poised for wider market 
        adoption.
  --Optimize strategies and technologies for the control of humidity 
        and indoor air quality in conjunction with gas-based space 
        heating and cooling systems.
  --Reduce first costs of emerging tankless and storage type water 
        heaters by at least 20 percent, while achieving efficiencies of 
        more than 80 percent for noncondensing and 90 percent for 
        condensing type units.
  --Develop a combination space/water heating system with improved 
        efficiency and reduced first cost to be used in residential, 
        multi-unit, and commercial buildings.
Solar/Natural Gas Hybrid Systems--$2.8 Million
    This effort will include technology development and laboratory and 
field testing, working with manufacturers of solar thermal or other 
renewable-resource systems. Particular attention will be given to 
integration/control and system sizing issues as well as safety and 
reliability (all of which will strongly impact commercial viability).
  --Develop solar thermal-natural gas hybrid technology and products 
        that cost-effectively generate heat, hot water, and steam, and 
        thermally driven cooling--reducing carbon emissions and the use 
        of fossil fuels.
  --Improve storage and integration of lower temperature thermal heat 
        (solar) with higher-temperature natural gas heat system.
  --Integrate concentrated solar with natural gas energy systems.
Breakthrough Technology Development--$2.1 Million
    This initiative will focus on developing and testing more advanced 
technologies and systems that will not be available for the market 
place for 3 to 7 years and will make extensive use of longer-term 
laboratory research. The main drivers for this research will be carbon 
emission reductions and improved efficiency thus producing the next 
wave of efficient and clean gas technologies for residential and 
commercial use. As promising technologies, components and systems 
emerge, appropriate lab and field testing will be conducted.
  --Develop catalytic and other approaches for carbon management (e.g., 
        formation, reduction, capture, conversion storage) of specific 
        combustion byproducts like carbon dioxide or carbon monoxide.
  --Support basic combustion research to improve efficiency, reduce 
        pollutant formation, increase heat transfer to improve the 
        operation of gas-based energy systems.
  --Perform hydrogen enrichment mixtures to reduce carbon emissions 
        from gas equipment--(a carbon mitigating approach may be to 
        provide a percentage of hydrogen through the natural gas 
        pipeline system).
Building Systems and Community Energy System Technologies--$2.6 Million
    Parallel attention will be given to both residential and selected 
commercial buildings. Different RD&D programs will be developed for 
selected building types (e.g., residential single-family homes 
retrofit, new-construction homes, multifamily dwellings, retail 
building, and institutional building) and regions (e.g., Northeast, 
Southwest). RD&D will include laboratory research but will also 
comprise extensive testing in instrumented buildings that will serve as 
field test facilities. R&D will be coordinated with architects and 
builders as well as developers and manufacturers of emerging energy 
systems and associated components and controls.
  --Develop approaches for optimized integration of gas systems with 
        the evolving Smart Energy Grid providing consumers new option 
        for energy management, comfort control and communication with 
        energy providers.
  --Perform advanced energy efficiency and carbon emission analysis 
        utilizing full fuel cycle protocol, develop new scientific data 
        and tools to support lowering overall energy use and carbon 
        emissions in homes and buildings.
  --Improve the efficiency and flexibility of operation of gas-based 
        equipment when used in combination with emerging building 
        technologies, new communications systems and other energy 
        systems.
Development of Higher-Efficiency and ENERGY STAR-rated Commercial Food 
        Service Equipment $1.6 Million
    This effort will include laboratory development and field testing, 
working with manufacturers and food service preparers. It will develop 
improved components that will increase energy efficiency, reduce 
emissions, and improve the productivity of ranges, ovens, grills, 
griddles, fryers, and other food preparation products.
  --Develop new cooking equipment designed to improve the currently 
        very low efficiency for natural gas cooking equipment.
  --Reduce combustion related emissions from gas-fueled residential and 
        commercial cooking equipment.
  --Improve the performance and reduce the cost of critical heat 
        transfer components in residential and commercial cooking 
        equipment.
    In the industrial Program in DOE's Energy Efficiency and Renewable 
Energy Office, we encourage overall funding that accommodates a total 
of $30 million for CHP (the budget request level and the fiscal year 
2010 appropriations are both $25 million). At least $8 million of these 
funds should be dedicated to small-scale systems below 20 kW. We also 
support a budget that directs at least $25 million to the Industries of 
the Future (Specific) Program, which would be in line with appropriated 
levels for the past several years and would be used to develop the 
technologies used in our Nation's heavy industries to manage their 
energy expenditures.
    Specific CHP initiatives include:
Small-Scale CHP Research and Development--$8 Million
      Micro Combined Heat and Power Products (10kW or less).--Develop, 
        using existing technological breakthroughs, a system which 
        would provide on-site electric power and domestic hot water and 
        heating for homes and small businesses utilizing either propane 
        or natural gas. This will include development of ``dark start'' 
        technology for use in communities where there is an inability 
        to deliver reliable electricity via traditional central power 
        station and transmission/distribution systems.
      Gas Heat Pump Technology (7.5-15- tons).--Continue previous DOE 
        efforts in gas-fired heat pumps (80-percent reduction in 
        electric peak demand in cooling and 150-percent efficiency in 
        heating mode). Necessary work:
    --fuel management and control development;
    --heat recovery to provide domestic hot water and space heating; 
            and
    --power generation.
      Further enhancements of the heat exchangers, engine, and 
        compressors will result in improved efficiency and lower first 
        costs. This will include development of auxiliary power 
        capability for plug-in hybrid fueling or other potential 
        critical power loads.
      Emissions and Carbon Footprint Reductions Reasearch and 
        Development.--Continue ongoing activity. Although the GHP and 
        Micro-CHP products meet the current air-quality requirements, 
        further emission reductions are being anticipated. This program 
        would take a pro-active stewardship toward reducing product 
        carbon footprints for small engine technology that requires 
        particular attention.
    Thank you for the opportunity to submit testimony.
                                 ______
                                 
        Prepared Statement of the American Geological Institute

    To the chairman and members of the subcommittee: Thank you for this 
opportunity to provide the American Geological Institute's (AGI) 
perspective on fiscal year 2012 appropriations for geoscience programs 
within the subcommittee's jurisdiction. The President's budget request 
for the Department of Energy (DOE) research programs provides important 
and modest investments in research and development (R&D) that will help 
support economic growth, job creation and energy independence, 
diversification and sustainable management. AGI strongly supports the 
wise and increased investments in the Office of Science ($5.4 billion) 
and Energy Efficiency and Renewable Energy ($3.2 billion) (particularly 
the increase for geothermal R&D within EERE). AGI strongly supports 
investments in geoscience education, training, and workforce 
development through the Office of Science's Workforce Development for 
Teachers and Scientists ($35 million).
    AGI is concerned about the termination of limited investments in 
oil and natural gas R&D within the Office of Fossil Energy. Oil and 
natural gas supply 62 percent of our Nation's energy and will continue 
to play a major role in the future. These investments will drive 
innovation to support and improve safe and effective domestic 
development of clean fossil fuels. The bulk of DOE's oil and gas R&D 
investments go to institutions of higher education for training and 
research. The United States has a substantial workforce and significant 
investments in oil and natural gas research, development, exploration, 
and production. Steady, but modest Federal investments in fossil energy 
R&D with a longer-term strategic plan would benefit the academic, 
private, and public sectors.
    The Office of Fossil Energy suffers from an unbalanced portfolio 
that focuses primarily on coal, faces uncertainty about direction and 
investments, and receives inconsistent funding. We ask for the 
subcommittee's support for oil and gas, unconventional natural gas, 
geothermal, hydropower, methane hydrates and carbon sequestration R&D 
so the Nation can develop a diverse portfolio of energy resources while 
enhancing carbon mitigation strategies to secure clean, affordable, and 
secure energy supplies for now and the future.
    AGI is a nonprofit federation of 49 geoscientific and professional 
associations that represents more than 120,000 geologists, 
geophysicists, and other earth scientists. The institute serves as a 
voice for shared interests in our profession, plays a major role in 
strengthening geoscience education, and strives to increase public 
awareness of the vital role that the geosciences play in society's use 
of resources and interaction with the environment.

                DEPARTMENT OF ENERGY'S OFFICE OF SCIENCE

    The DOE Office of Science is the single largest supporter of basic 
research in the physical sciences in the United States, providing more 
than 40 percent of total funding for this vital area of national 
importance. The Office of Science manages fundamental research programs 
in basic energy sciences, biological and environmental sciences, and 
computational science and, under the budget request, would grow by 
about 9 percent from about $4.9 billion in 2010 to $5.4 billion in 
fiscal year 2012. AGI asks that you support this much needed increase.
    The President's request would provide $35 million for Workforce 
Development for Teachers and Scientists, a program aimed at ensuring 
that DOE and the Nation have a sustained pipeline of highly skilled and 
diverse science, technology, engineering, and mathematics (STEM) 
workers. AGI strongly supports investments in geoscience education, 
training, and workforce development within DOE and other Federal 
agencies.

     DEPARTMENT OF ENERGY'S ENERGY EFFICIENCY AND RENEWABLE ENERGY

    Within Energy Efficiency and Renewable Energy, the President's 
fiscal year 2012 budget request would increase investments for R&D for 
many renewable energy resources. AGI applauds the $102 million 
requested for geothermal R&D and greatly appreciates previous support 
from the Congress for this key alternative energy resource. The 
geothermal research program within the renewable energy account, which 
funds Earth science research in materials, geofluids, geochemistry, 
geophysics, rock properties, reservoir modeling, and seismic mapping 
will provide the Nation with the best research to build a successful 
and competitive geothermal industry. AGI also supports an Energy 
Innovation Hub focused on critical materials and hope this hub will 
consider ways to improve exploration, extraction, and processing of 
necessary raw materials as well as replacement materials.

     DEPARTMENT OF ENERGY'S FOSSIL ENERGY RESEARCH AND DEVELOPMENT

    AGI urges you to look critically at the Fossil Energy Research and 
Development portfolio as you prepare to craft the fiscal year 2012 
Energy and Water Development appropriations bill. Many Members of 
Congress have strongly emphasized the need for a responsible, 
diversified, and comprehensive energy policy for the Nation. The 
growing global competition for fossil fuels has led to a repeated and 
concerted request by the Congress to ensure the Nation's energy 
security. The President's proposal, which provides no funding for oil 
and gas R&D, is short sighted and inconsistent with congressional and 
public concerns. No funding for oil and gas R&D will hinder our ability 
to achieve energy stability and security.
    The research dollars invested in oil and gas R&D go primarily to 
universities, State geological surveys, and research consortia to 
address critical issues like enhanced recovery from known fields and 
unconventional sources that are the future of our natural gas supply. 
This money does not go into corporate coffers, but it helps American 
businesses remain competitive by giving them a technological edge over 
foreign companies. All major advances in oil and gas production can be 
tied to research and technology. AGI strongly encourages the 
subcommittee to ensure a balanced and diversified energy research 
portfolio that does not ignore the Nation's primary sources of energy 
for the near future, fossil fuels.
    Thank you for the opportunity to present this testimony to the 
subcommittee.
                                 ______
                                 
      Prepared Statement of the American Public Power Association

    The American Public Power Association (APPA) respectfully requests 
funding for the Renewable Energy Production Incentive, Power Marketing 
Administrations, storage for high-level nuclear waste, the Nuclear Loan 
Guarantee Program, the Department of Energy Water Power Program, energy 
conservation, weatherization, clean coal, fuel cells, fuel and powering 
systems, the Navajo Electrification and Demonstration Program and the 
Federal Energy Regulatory Commission (FERC).
    APPA is the national service organization representing the 
interests of more than 2,000 municipal and other State and locally 
owned electric utilities in 49 States (all but Hawaii). Collectively, 
public power utilities deliver electricity to 1 of every 7 electric 
consumers (approximately 46 million people), serving some of the 
Nation's largest cities. However, the vast majority of APPA's members 
serve communities with populations of 10,000 people or less.
    We understand that the Congress is operating in a tight fiscal 
environment. APPA's priority is to support programmatic requests that 
bring down costs, conserve resources, or benefit our public power 
customers in other ways. We appreciate the opportunity to submit this 
statement outlining our fiscal year 2012 funding priorities within the 
jurisdiction of the Energy and Water Development Subcommittee.
    Renewable Energy Production Incentive (REPI).--APPA is disappointed 
that the administration and the Congress have decided to stop funding 
the REPI. REPI was the first attempt by the Congress to provide 
comparable renewable incentives to the nonprofit electric utility 
industry and we continue to seek comparability to this day. The 
elimination of funding for the REPI program was a step backward in this 
process. Defunding not only decreases incentives for new production, 
but utilities who had been receiving the funding are stranded mid-
program. Five million dollars would restore funding to the program for 
fiscal year 2012, but any funding would help restore payments to those 
already approved for the incentive.

                    POWER MARKETING ADMINISTRATIONS

    Power Marketing Administrations Proposals.--The President's 
National Commission on Fiscal Responsibility and Reform proposed a 
measure for all four Power Marketing Administrations (PMA) that would 
have had the effect of raising the rates for PMA customers. We 
appreciate that the fiscal year 2012 request did not include this type 
of proposal.
    Purchase Power and Wheeling.--We urge the subcommittee to authorize 
appropriate levels for use of receipts so that the Western Area Power 
Administration (WAPA), the Southeastern Power Administration (SEPA) and 
the Southwestern Power Administration (SWPA) can continue to purchase 
and wheel electric power to their municipal and rural electric 
cooperative customers. Although appropriations are no longer needed to 
initiate the purchase power and wheeling (PP&W) process, the 
subcommittee continues to establish ceilings on the use of receipts for 
this important function. The PP&W arrangement is effective, has no 
impact on the Federal budget, and is supported by the PMA customers who 
pay the costs. We support an increase over the funding levels of the 
administration's budget for fiscal year 2012, which are as follows:
  --$307 million for WAPA;
  --$100 million for SEPA; and
  --$40 million for SWPA.
    Construction.--We urge the subcommittee to authorize appropriate 
levels of funding for the construction budgets of WAPA, SEPA, and 
SWAPA. These budgets have continued to decrease over the years however, 
this funding remains critical to the operation and maintenance of the 
PMAs.
    Storage for High-Level Nuclear Waste.--APPA is disappointed that 
the administration closed the Yucca Mountain Project and the Office of 
Civilian Radioactive Waste Management in fiscal year 2010. We support 
the work of the Blue Ribbon Commission on America's Nuclear Future and 
look forward to hearing the Commission's recommendations on how the 
Nation should manage nuclear waste.
    Nuclear Loan Guarantees.--APPA is pleased with the administration's 
request for DOE Loan Guarantee authority up to $36 billion for new 
nuclear facilities and encourages the subcommittee to maintain this 
level of funding.
    DOE Water Power Program.--APPA was extremely disappointed that 
funding for water power was decreased by 20 percent while all other 
renewable resources were increased in the administration's fiscal year 
2012 request. APPA believes there should be parity among renewable 
resource funding. APPA requests $100 million for fiscal year 2012 for 
the DOE's Water Power Program. At a time when utilities around our 
country must focus on finding carbon-free sources of energy because of 
pending State and Environmental Protection Agency regulations, the 
importance of hydropower research and development is more important 
than ever before. Not only is hydropower a renewable resource, but it 
can be used as baseload generation to back up more intermittent 
renewables such as wind and solar power.
    Energy Conservation.--APPA appreciates the funding increases for 
energy efficiency programs provided in the President's budget. The 
budget funding levels for fiscal year 2012 are as follows:
  --Building technologies--$470 million;
  --Industrial technologies--$319 million;
  --Federal Energy Management Program--$33 million; and
  --Vehicle technologies--$588 million.
    We urge the subcommittee to maintain these funding levels.
    Weatherization and Intergovernmental Activities.--We are pleased 
that the administration has requested $394 million for the 
weatherization program in fiscal year 2012, a significant increase from 
fiscal year 2010, and we encourage the subcommittee to maintain that 
level of funding.
    Clean Coal Power Initiative and FutureGen.--APPA is disappointed 
that the budget did not include funding for large-scale commercial 
applications of carbon capture and sequestration technology. We 
encourage the subcommittee to include funding for Clean Coal Power 
Initiative (CCPI) and FutureGen. APPA strongly believes as the need for 
clean-energy increases, the FutureGen project, or something similar, 
will be critical in nearing us to the goal of the world's first near-
zero-emissions coal fired plant. We urge the subcommittee and the 
Congress to work with the administration on finding an appropriate role 
and funding level for the FutureGen project and CCPI.
    Fuel Cells.--APPA was disappointed that the administration 
requested zero funding for fuel cell related research and development. 
We urge the subcommittee to allocate additional funding for this 
program for fiscal year 2012.
    Fuels and Power Systems.--We recommend these funding levels for the 
following programs:
      Innovations for Existing Plants.--$84 million;
      Advanced Integrated Gasification Combined Cycle.--$80 million;
      Turbines.--$45 million;
      Carbon Sequestration.--$150 million;
      Fuels.--$25 million; and
      Advanced Research.--$48 million.
    Navajo Electrification Demonstration Program.--APPA supports full 
funding for the Navajo Electrification Demonstration Program at its 
full authorized funding level of $15 million. The purpose of the 
program is to provide electric power to the estimated 18,000 occupied 
structures in the Navajo Nation that lack electric power. This program 
has been consistently underfunded.
    FERC.--The fiscal year 2012 budget requests $305 million for FERC, 
an increase more than fiscal year 2010 levels. APPA supports this 
increase.
                                 ______
                                 
      Prepared Statement of the American Society for Microbiology

    The American Society for Microbiology (ASM) is pleased to submit 
the following testimony on the fiscal year 2012 appropriation for 
science programs at the Department of Energy (DOE). The ASM is the 
largest single life science organization in the world with more than 
38,000 members. The ASM mission is to enhance the science of 
microbiology, to gain a better understanding of life processes, and to 
promote the application of this knowledge for improved health and 
environmental well-being.
    ASM supports the administration's proposed fiscal year 2012 budget 
of $5.4 billion for the DOE's Office of Science, a 9.1-percent increase 
more than the fiscal year 2010 appropriation level. The proposed fiscal 
year 2012 budget will enable the Office of Science to continue its 
leadership in critical areas including:
  --renewable energy;
  --environmental cleanup;
  --carbon capture and sequestration;
  --climate change; and
  --basic research across the physical and biological sciences.
    DOE investments in science and technology create new industries and 
jobs, and strengthen United States basic research capabilities. The 
Office of Science funds research in academic institutions, DOE 
laboratories and technology centers that employ more than 30,000 
scientists and engineers. In fiscal year 2012, more than 26,000 
researchers from universities, national laboratories, industry and 
international groups are expected to use DOE's world-renowned research 
facilities.
    The Office of Science is the largest Federal sponsor of basic 
research in the physical sciences as well as the largest Federal funder 
of materials and chemical sciences. The 10 national laboratories 
directly overseen by the Office of Science are world leaders in basic 
and applied research, generating breakthroughs in multiple disciplines. 
DOE provides scientific expertise to address challenges including 
events in postearthquake Japan, the search for clean energy, and many 
environmental challenges.
    ASM has a specific interest in microbiological research overseen by 
the Biological and Environmental Research (BER) program. Microorganisms 
are essential to research areas like biofuels and environment 
remediation. ASM recommends congressional approval of the proposed 
budget increase for the BER program to $718 million, about 22 percent 
more than the fiscal year 2010 level.

  DEPARTMENT OF ENERGY'S INVESTMENTS IN BIOLOGICAL AND ENVIRONMENTAL 
                  RESEARCH YIELD INNOVATIVE SOLUTIONS

    The Biological and Environmental Research program cuts across 
scientific and engineering disciplines to understand complicated 
biological, climatic, and environmental systems. BER-funded research 
has advanced scientific knowledge providing the foundational research 
to support biofuels development, monitor subsurface contaminants and 
expose the effects of greenhouse gas emissions. BER funding is also 
responsible for new research tools that help investigators explore the 
interface of biological and physical sciences.
    The BER research portfolio has transformed science and technology 
in the United States. An example is the Human Genome Project initiated 
by BER in 1986, a catalyst for the biotechnology industry and the 
emerging field of systems biology. BER-sponsored activities have helped 
shape modern climate science with powerful climate modeling 
capabilities. BER's computing experts and facilities have guided new 
disciplines dependent upon high-end computer resources, such as 
computational biology and bioinformatics. DOE funding has influenced 
scientific discovery. Recent examples include:
  --Use of a newly patented group of naturally occurring microbes to 
        detoxify chlorinated solvents that contaminate a former DOE 
        reactor site, improving groundwater quality;
  --Genetic mapping of plant digesting microbes from the cow rumen, 
        generating 270 billion letters of the DNA code in a massive 
        data-collecting effort to understand how to efficiently degrade 
        plant biomass for biofuels production; and
  --Atomic-scale xray crystallography studies that identified microbial 
        proteins possibly key to formation of drug-resistant biofilms, 
        suggesting new antibiotic targets.
    The fiscal year 2012 budget proposes increases for the areas of 
genomic science and computational biosciences, as well as for BER's 
Joint Genome Institute, Structural Biology Infrastructure and programs.
    BER's major scientific goals for fiscal year 2012 include advances 
in genomic science, radiological sciences, climate research, and 
subsurface biogeochemistry. Relevant research will be distributed 
between BER's two subprograms, Biological Systems Science Division 
(BSSD) and Climate and Environmental Sciences Division (CESD). The 
former focuses on fundamental principles related to function and 
structure of living systems from microbes to mammals, while the latter 
examines environmental impacts of energy production and use. Both rely 
heavily on microbiological systems and techniques.
    The fiscal year 2012 request for BSSD is $376 million, an increase 
from the fiscal year 2010 level of $310 million. In fiscal year 2012, 
CESD would receive nearly $342 million compared to $278 million in 
fiscal year 2010. Within CESD, Environmental System Science activities 
increase by 22 percent. BER budgets also include support for world 
class facilities and research consortia. The BSSD subprogram manages 
the Joint Genome Institute, the Bioenergy Science Center, the Joint 
Bioenergy Institute, and three DOE Bioenergy Research Centers. The CSSD 
oversees two scientific user facilities, the Atmospheric Radiation 
Measurement Climate Research Facility and the Environmental Molecular 
Sciences Laboratory (EMSL). The Joint Genome Institute is now 
sequencing more than 4 trillion genome base pairs annually (more than 
130 times that of 5 years ago), while EMSL with its powerful 
instrumentation and computing housed at DOE's Pacific Northwest 
National Laboratory, leads worldwide efforts in the field of 
proteomics. Results reported from BER-funded research in the past year 
include:
  --Scientists at Massachusetts Institute of Technology concluded that 
        various microbial species cooperate in marine environments 
        during their cycling of organic matter, important to the global 
        carbon cycle (BSSD-funded).
  --Bioenergy Science Center studies described a new method to 
        genetically modify the cellulose-degrading bacterium 
        Clostridium thermocellum, with potential to expedite critical 
        degradation steps in biofuels production. DOE scientists at 
        Princeton University developed the first-ever quantitative 
        model for metabolic processes in another Clostridium species 
        that produces butanol, ethanol, and hydrogen during biomass 
        fermentation and is already used by industry--a step toward 
        engineering the microbe for biofuels synthesis.
  --Another collaborative CESD study determined that different 
        microorganisms convert soluble uranium to different forms of 
        reduced uranium, pertinent to controlling contaminants at 
        nuclear sites. Other researchers used microbial fuel cell 
        techniques and electrodes inserted into soil to monitor 
        microbial activity as related to the progress of uranium 
        bioremediation, a technique also applicable to other microbial 
        processes in the environment.

    DEPARTMENT OF ENERGY'S RESEARCH BUILDS RESEARCH AND DEVELOPMENT 
                       INFRASTRUCTURE, WORKFORCE

    DOE science programs have evolved and expanded into an R&D 
infrastructure unparalleled in specific areas of science, technology, 
engineering, and mathematics. DOE laboratories operate sophisticated 
equipment often not available elsewhere, and large numbers of non-DOE 
researchers from the United States and other countries regularly use 
DOE facilities to conduct studies that would otherwise be impossible.
    The DOE Office of Science has built extraordinary research 
capabilities, including particle accelerator centers, advanced 
computational centers, and atmospheric monitoring facilities. As an 
example, EMSL offers users a supercomputer and more than 60 major 
instruments to support environmental sciences, serving more than 700 
users annually. In the past year, an international team of more than 80 
researchers from 21 institutions used the world's first hard xray free-
electron laser, the Linac Coherent Light Source at DOE's Stanford 
Linear Accelerator Center National Accelerator Laboratory, to produce 
the first single-shot images of intact viruses, expected to lead to 
eventual videos of molecules, viruses and live microbes in action.
    Innovative research tools developed at the national labs or other 
DOE-funded institutions regularly stimulate multiple scientific fields, 
often transferring to the technology marketplace as valuable commercial 
products. The DOE toolkit includes research protocols, monitoring and 
measuring equipment, computer models and databases, and considerably 
more. One commercialized example is the PhyloChip developed by DOE 
scientists that can detect up to 50,000 species of bacteria and archaea 
in a single environmental sample, which was deployed at last year's 
gulf oil spill. The innovation has already spawned a start-up company 
and is expected to have broad applications in monitoring. At BER's 
Joint Bioenergy Institute, scientists developed a mass spectrometry-
based detection technique called multiple-reaction monitoring, to more 
efficiently and accurately identify microbial proteins that convert 
cellulosic sugars to biofuels. Last year, BER-sponsored university 
scientists introduced an optimization method that delineates all 
possible metabolic pathways in an organism like biofuels-related 
bacteria, then suggests which genetic changes could trick the microbe 
into overproducing a desired product like ethanol.
    The Office of Science also supports the Workforce Development for 
Teachers and Scientists (WDTS) program, at $35.6 million, a substantial 
72-percent increase more than fiscal year 2010. The WDTS program 
continues DOE's long history of training scientists, mathematicians, 
and engineers as U.S. technical workforce, principally through research 
grants and contracts at universities, the private sector, and DOE's own 
laboratories. The program also reaches out to all academic levels. Each 
year, participants in training and education programs at DOE 
laboratories include--
  --more than 250,000 K-12 students;
  --22,000 K-12 educators;
  --4,000 undergraduate interns;
  --3,000 graduate students; and
  --1,600 postdoctoral employees.
    In 2010, a new graduate fellowship program selected its first 
cohort of 150 students, beginning an initiative to attract more 
students to careers in physics, chemistry, biology, mathematics, 
engineering, environmental sciences, or computer sciences.
department of energy's partnerships elevate u.s. science and technology
    The BER program collaborates with other Federal agencies including 
the National Science Foundation, the Department of Agriculture (USDA), 
the National Institutes of Health, and the Department of Defense, to 
optimize complementary research. DOE and USDA, for example, share 
similar goals in finding new bioenergy sources while DOE's climate 
change studies integrate closely with those in multiple Federal 
agencies. DOE collaborations extend to academia, industry, nonprofits, 
and international partners. The Office of Science funds more than 7,000 
individual research projects at universities, national laboratories, 
U.S. industry, and the nonprofit sector. In fiscal year 2012, the BER 
budget would support approximately 2,400 researchers and graduate 
students in more than 200 U.S. Federal, academic, and private 
institutions. DOE personnel also advise non-DOE scientists and 
policymakers; about 40 DOE experts have travelled to Japan with more 
than 17,000 pounds of equipment to help monitor radiation released by 
the recent earthquake.
    Extramural DOE funding contributes significantly to science and 
technology achievements. More than 110 Nobel laureates have received 
DOE support, as did two recipients of the 2011 Franklin Institute 
Medal. Last year, 39 DOE-funded projects garnered R&D 100 Awards which 
recognize the world's most promising new products, processes, 
materials, or software that had entered the market the previous year. 
DOE funding has supported the basic research for 800 R&D 100 winners 
since 1962.

                               CONCLUSION

    ASM recommends that the Congress approve the proposed fiscal year 
2012 budget for the DOE science programs that support diverse often 
large-scale research, uniquely important to the U.S. economy, national 
security, a healthy environment and the future status of U.S. science 
and technology.
                                 ______
                                 
 Prepared Statement of the American Society of Agronomy; Crop Science 
      Society of America; and the Soil Science Society of America

    The American Society of Agronomy (ASA), Crop Science Society of 
America (CSSA), and Soil Science Society of America (SSSA) are pleased 
to submit the following funding recommendations for the Department of 
Energy (DOE) for fiscal year 2012. For the Office of Science, ASA, 
CSSA, and SSSA recommend a funding level of $5.4 billion.
    With more than 25,000 members and practicing professionals, ASA, 
CSSA, and SSSA are the largest life science professional societies in 
the United States dedicated to the agronomic, crop and soil sciences. 
ASA, CSSA, and SSSA play a major role in promoting progress in these 
sciences through the publication of quality journals and books, 
convening meetings and workshops, developing educational, training, and 
public information programs, providing scientific advice to inform 
public policy, and promoting ethical conduct among practitioners of 
agronomy and crop and soil sciences.

                 DEPARTMENT OF ENERGY OFFICE OF SCIENCE

    ASA, CSSA, and SSSA understand the challenges the Senate Energy and 
Water Development Appropriations Subcommittee faces with the tight 
budget for fiscal year 2012. We also recognize that the Energy and 
Water Development Appropriations bill has many valuable and necessary 
components, and we applaud the subcommittee for the support provided to 
the Department of Energy (DOE) Office of Science. For fiscal year 2012, 
ASA, CSSA, and SSSA recommend a funding level of $5.4 billion.
    The Congress approved the America COMPETES Reauthorization Act of 
2010 (Public Law 111-358), recognizing that an investment in basic 
(discovery) scientific research is essential to providing America the 
brainpower necessary to maintain a competitive advantage in the global 
economy and keep U.S. jobs from moving overseas. Such an investment is 
needed to keep U.S. science and engineering at the forefront of global 
research and development in the biological sciences and geosciences, 
computing and many other critical scientific fields. The Office of 
Science supports graduate students and postdoctoral researchers early 
in their careers. However, because of the uncertainty of the Federal 
budget, the Office of Science was not able to provide the essential 
support needed in fiscal year 2011. As a result, it is important that 
increase emphasis is placed on these programs in fiscal year 2012. 
Nearly one-third of its research funding goes to support research at 
more than 300 colleges and universities nationwide. The Office of 
Science also reaches out to America's youth in grades K-12 and their 
teachers to help improve students' knowledge of science and mathematics 
and their understanding of global energy and environmental challenges. 
This recommended funding level of $5.4 billion is critical to ensuring 
our future energy self-sufficiency and as a means to address major 
environmental challenges including global climate change. Finally, a 
funding level of $5.4 billion will allow the Office of Science to:
  --maintain and strengthen DOE's core research programs at both the 
        DOE national laboratories and at universities;
  --provide support for Ph.D.s, postdoctoral associates, and graduate 
        students;
  --ensure maximum utilization of DOE research facilities; and
  --allow the Office of Science to develop and construct the next-
        generation facilities necessary to maintain U.S. pre-eminence 
        in scientific research.
Basic Energy Sciences
    Within the Office of Science, the Basic Energy Sciences (BES) 
program is a multipurpose, scientific research effort that fosters and 
supports fundamental research to expand the scientific foundations for 
new and improved energy technologies and for understanding and 
mitigating the environmental impacts of energy use. The research 
disciplines that the BES program supports include condensed matter and 
materials physics, chemistry, soil, mineralogical, and geosciences, 
influencing virtually every aspect of energy resources, production, 
conversion, transmission, storage, efficiency, and waste mitigation. 
Research in geosciences leads to advanced monitoring and measurement 
techniques for reservoir definition. The BES program is one of the 
Nation's largest sponsors of research in the natural sciences. In 
fiscal year 2010, the program funded research in more than 170 academic 
institutions located in 50 States and in 14 DOE laboratories located in 
12 States. Thus, approximately 40 percent of the BES program's research 
activities are sited at academic institutions.
    Within the BES program, the chemical sciences, geosciences, and 
energy biosciences subprogram supports fundamental research in soil, 
biogeochemistry, geophysics, and biosciences. We support funding this 
subprogram at $394.7 million in fiscal year 2012.
    Within BES there exists several critical pieces of equipment 
essential for elucidating the soil's potential to provide essential 
services--carbon sequestration, nutrient cycling, water purification, 
waste treatment, provisioning of industrial and pharmaceutical goods, 
and a mitigating sink for chemical and biological agents--that enhance 
the resilience of managed and natural systems.
    As such, the Societies support the increases included in the 
President's budget for the major items of equipment projects, including 
the Linac Coherent Light Source (LCLS) at SLAC National Accelerator 
Laboratory, the world's first hard xray free electron laser (FEL), 
which produces ultrafast pulses of xrays millions of times brighter 
than even the most powerful synchrotron light sources. The LCLS 
provides scientists with a unique tool for studying the arrangement and 
motion of atoms and electrons in metals, semiconductors, ceramics, 
polymers, catalysts, plastics, and biological molecules with the 
potential to significantly impact advanced energy research and other 
fields. The societies support the requested increase for the LCLS 
included in the President's fiscal year 2012 budget (+$30,000,000 more 
than fiscal year 2010) to extend the xray spectral range at the LCLS.
    Our soil scientists also are users of the National Synchrotron 
Light Source (NSLS-II) built to enable the study of material properties 
and functions, particularly materials at the nanoscale, at a level of 
detail and precision never before possible. We support the increase 
requested in fiscal year 2012 (+$12,000,000 more than fiscal year 2010) 
to initiate the fabrication of approximately 5 to 6 additional 
instruments.
    The Geosciences Research Program supports research focused at 
developing an understanding of fundamental Earth processes that can be 
used as a foundation for efficient, effective, and environmentally 
sound use of energy resources, and provide an improved scientific basis 
for advanced energy and environmental technologies. We support the 
$19.3 million increase proposed by the President to the Geosciences 
program, specifically for the purposes of continuing to expand research 
on geochemical studies and computational analysis of complex subsurface 
fluids and solids.
Biological and Environmental Research
    Within the Office of Science, the Biological and Environmental 
Research (BER) program, for more than five decades, has advanced 
environmental and biological knowledge that supports national security 
through improved energy production, development, and use; international 
scientific leadership that underpins our Nation's technological 
advances; and research that improves the quality of life for all 
Americans. BER supports these vital national missions through 
competitive and peer-reviewed research at national laboratories, 
universities, and private institutions. ASA, CSSA, and SSSA support the 
funding of the BES at the President's requested level for fiscal year 
2012 of $717.9 million. A variety of programs within BER are essential 
to continued fundamental research about biological systems science, 
geochemical observations, and determining environmental sustainability 
of our energy production systems. Among other items, the DOE Bioenergy 
Research Centers, the Joint Genome Institute, the Environmental 
Molecular Science Laboratory, and biological sequencing science are 
essential for overcoming the challenges of ensuring our Nation's energy 
security and environmental health.
    The Climate and Environmental Sciences subprogram, Environmental 
Systems Science will support essential subsurface biogeochemical 
research and basic research on the fate and transport of contaminants 
in the subsurface. The ASA, CSSA, and SSSA support funding for 
Environmental Systems Science at $104.2 million for fiscal year 2012, a 
level which would retain funding for the Terrestrial Carbon 
Sequestration Research, while also investing in research on contaminant 
transport to ensure minimal risk to exposure. This research addresses 
unique physical, chemical, and biological processes controlling the 
flux of contaminants across and within the root zone of soils and the 
flux of contaminants to surface water bodies. Processes in these 
critical zones influence fluxes of carbon and key nutrients between the 
atmosphere and terrestrial biosphere.

                     IDENTIFYING ESSENTIAL RESEARCH

    Our members participated in the community-based workshop in March 
2010 that developed the workshop report, ``Complex Systems Science for 
Subsurface Fate and Transport.'' The report emphasized the need to 
understand the role that subsurface biogeochemical processes play in 
determining the fate and transport of contaminants including heavy 
metals and radionuclides. Participants concluded that computational 
models of coupled biological, geochemical, and hydrological processes 
are needed to predict the rates and kinetics of transformation and 
sequestration of these critical DOE contaminants.
    Within BER, we support the increase included in the President's 
budget for the Genomic Science Program, to bring the total level of 
funding to $241.5 million for fiscal year 2012. The Joint Genome 
Institute within the Genomic Program is an essential infrastructural 
component which uses tools from contemporary systems biology to 
understand and predict the energetic relationships between microbes and 
plants. The increase would support synthetic molecular toolkits that 
predict, design, construct, and test new biological systems for clean-
energy solutions.

                         NATIONAL LABORATORIES

    The Office of Science manages 10 world-class laboratories, which 
often are called the ``crown jewels'' of our national research 
infrastructure.
National Energy Technology Laboratory
    National Energy Technology Laboratory's Carbon Sequestration 
Program is helping to develop technologies to capture, purify, and 
store carbon dioxide (CO2) in order to reduce greenhouse gas 
emissions without adversely influencing energy use or hindering 
economic growth. Program efforts in this area are focused on increasing 
carbon uptake on mined lands and evaluation of no-till agriculture, 
reforestation, rangeland improvement, wetlands recovery, and riparian 
restoration.
Oak Ridge National Laboratory
    Oak Ridge National Laboratory (ORNL) is one of the world's premier 
centers for research and development on energy production, 
distribution, and use and on the effects of energy technologies and 
decisions on society. Clean, efficient, safe production, and use of 
energy have long been our goals in research and development. At ORNL, 
unique facilities for energy-related R&D are used both for technology 
development and for fundamental investigations in the basic energy 
sciences that underpin the technology work.
    Thank you for your thoughtful consideration of our requests.
                                 ______
                                 
     Prepared Statement of the American Society of Plant Biologists

    On behalf of the American Society of Plant Biologists (ASPB), we 
submit this statement for the official record to support the requested 
level of $5.42 billion for the Department of Energy (DOE) Office of 
Science for fiscal year 2012. The testimony highlights the importance 
of biology--particularly plant biology--as the Nation seeks to address 
vital issues such as energy security.
    ASPB and its members recognize the difficult fiscal environment our 
Nation faces, but believe investments in scientific research will be a 
critical step toward economic recovery. We would also like to thank the 
subcommittee for its consideration of this testimony and for its 
support for the basic research mission of the DOE Office of Science.
    ASPB is an organization of approximately 5,000 professional plant 
biology researchers, educators, graduate students, and postdoctoral 
scientists with members in all 50 States and throughout the world. A 
strong voice for the global plant science community, our mission--
achieved through work in the realms of research, education, and public 
policy--is to promote the growth and development of plant biology, to 
encourage and communicate research in plant biology, and to promote the 
interests and growth of plant scientists in general.

    FOOD, FUEL, ENVIRONMENT, AND HEALTH--PLANT BIOLOGY RESEARCH AND 
                            AMERICA'S FUTURE

    Plants are vital to our very existence. They harvest sunlight, 
converting it to chemical energy for food and feed; they take up carbon 
dioxide and produce oxygen; and they are the primary producers on which 
all life depends. Indeed, plant biology research is making many 
fundamental contributions in the areas of domestic fuel security and 
environmental stewardship; the continued and sustainable development of 
better foods, fabrics, pharmaceuticals, and building materials; and in 
the understanding of basic biological principles that underpin 
improvements in the health and nutrition of all Americans. In fact, the 
2009 National Research Council (NRC) report ``A New Biology for the 
21st Century'' placed plant biology at the center of urgent priorities 
in energy, food, health, and the environment.
    In particular, plant biology is at the center of numerous 
scientific breakthroughs in the increasingly interdisciplinary world of 
alternative energy research. For example, interfaces among plant 
biology, engineering, chemistry, and physics represent critical 
frontiers in both basic biofuels research and bioenergy production. 
Similarly, with the increase in plant genome sequencing and functional 
genomics, the interface of plant biology and computer science is 
essential to our understanding of complex biological systems ranging 
from single cells to entire ecosystems.
    Despite the fact that plant biology research--the kind of research 
funded by DOE--underpins so many vital practical considerations for our 
country, the amount invested in understanding their basic function and 
mechanisms is relatively small when compared with broader impacts on 
areas including energy security and economic development.

                            RECOMMENDATIONS

    Because of our membership's extensive expertise, ASPB is in an 
excellent position to articulate the Nation's plant science priorities 
as they relate to bioenergy and, specifically, with regard to 
recommendations for bioenergy research funding through the DOE's Office 
of Science.
    Within the Office of Science, the programs in BER and BES are 
crucial to understanding how basic biological processes work. For this 
reason ASPB is supportive of the fiscal year 2012 request to fund BER 
at $717.9 million and BES at $1.985 billion. Sustained funding for 
these programs is vital as the discoveries made in these areas will 
ultimately be the foundation for the next fuels and technologies we use 
in our daily lives.
    In addition:
  --We commend the DOE Office of Science, through their programs in 
        Basic Energy Sciences and Biological and Environmental Research 
        for funding the Bioenergy Research Centers and the Energy 
        Frontier Research Centers. These centers provide a model for 
        collective science innovation that complements DOE's essential 
        investment in individual investigator and small group science. 
        ASPB strongly encourages funding for the DOE Office of Science 
        that would be specifically targeted to the funding of 
        individual or small group grants for bioenergy research.
  --Photosynthetic research is one clear example of an interface 
        between the physical sciences and biology. Indeed, the 
        importance of disciplinary integration is a central theme of 
        several recent NRC reports including ``A New Biology for the 
        21st Century, Research at the Intersection of the Physical and 
        Life Sciences, and Inspired by Biology: From Molecules to 
        Materials to Machines''. The DOE Office of Science has been the 
        major source of funding for fundamental studies of 
        photosynthesis, which is the primary source of chemical energy 
        on the planet. However, the current funding available for 
        photosynthetic research is not commensurate with the central 
        role that photosynthesis plays in energy capture and carbon 
        sequestration. Hence, ASPB calls for the Office of Science to 
        expand its research portfolio in the area of photosynthesis and 
        carbon capture.
  --Considerable research interest is now being paid to the use of 
        plant biomass for energy production. If biomass crops are to be 
        used to their full potential, however, considerable effort must 
        be expended to improve our understanding of their basic biology 
        and development, as well as their agronomic performance. 
        Therefore, ASPB calls for DOE to support research targeted at 
        efforts to increase the utility and agronomic performance of 
        bioenergy crops and to enhance understanding of plant cell 
        walls and the production of cellulosic biomass.
    Thank you for your consideration of our testimony on behalf of the 
American Society of Plant Biologists.
                                 ______
                                 
       Prepared Statement of the American Wind Energy Association

                              INTRODUCTION

    After experiencing a record year of growth in 2009, the American 
wind industry installed just more than 5,000 megawatts (MW) of capacity 
last year. Two of the principal causes for the decrease were the 
reduced demand for electricity due to the economic slowdown and the low 
price of natural gas compared with historic levels. Wind systems are 
commercially deployable today and cost-competitive with virtually all 
other new electricity generation sources. In addition, polling 
consistently shows that a strong majority of Americans want more wind 
power. Just last year, 89 percent of American voters (84 percent of 
Republicans, 88 percent of Independents, and 93 percent of Democrats) 
agreed that increasing the amount of energy our Nation gets from wind 
energy is a good idea.\1\ However, keeping America's domestic wind 
industry competitive with other generation sources and the wind 
industry in other countries depends in part on increased research, 
development, and deployment (RD&D) funding to reduce costs and improve 
reliability.
---------------------------------------------------------------------------
    \1\ March 2010 survey by Neil Newhouse, Public Opinion Strategies; 
Anna Bennett, Bennett, Petts & Norrington.
---------------------------------------------------------------------------
    The American Wind Energy Association (AWEA) requests a funding 
level of $144.2 million for fiscal year 2012 for the Department of 
Energy's (DOE) Wind Energy Program, an increase of $17.3 million more 
than the President's congressional budget request. Of this amount, AWEA 
requests that an additional $10.1 million be designated for the 
integration of variable power sources. An additional $6.2 million 
should be provided for the R&D of advanced technology components, and 
an additional $1 million should be provided for the study of wind 
energy and wildlife interactions. While we recognize that DOE has 
proposed a $64 million increase in funding for needed offshore wind R&D 
and generally concur with the proposed research activities, we wish to 
re-emphasize the importance of expanded R&D for land-based 
installations as well.
    We appreciate the recognition of the important role wind energy 
will play in meeting America's future energy needs, which is reflected 
in the 60-percent increase in funding for the DOE Wind Energy Program 
that is included in the President's budget request. This funding 
increase is an important step in overcoming constraints to meeting the 
DOE's scenario of wind energy providing 20 percent of our Nation's 
electricity by 2030,\2\ but funding should be increased in the three 
critical areas mentioned above, and maintained for wind resource 
characterization.
---------------------------------------------------------------------------
    \2\ U.S. Department of Energy, ``20 Percent Wind Energy by 2030'' 
(July 2008).
---------------------------------------------------------------------------
      importance of the department of energy's wind energy program
    For years, the DOE Wind Energy Program has provided important help 
to the wind industry by supporting technology advances and identifying 
and addressing other hurdles to wind energy development. The program 
provides needed technical support, guidance, information, and limited 
cost-shared funding for efforts to explore and develop wind energy 
resources. AWEA commends the DOE Wind Energy Program for successfully 
developing programs that are consistent with the wind industry's long-
term needs. We have noticed a growing rigor in the program's 
organization and structure to address the needs of the growing wind 
industry.
    Past investments in wind have resulted in significant improvements 
over the past 30 years, such as increased output, improved reliability, 
and lower costs. In fact, the cost of wind, when adjusted for 
inflation, has dropped from more than $0.50/kWh in 1980 to between 
$0.05 and $0.06 today.\3\ Despite this dramatic decrease, there is 
still plenty of room for further reductions that will be critical for 
wind energy to compete in an environment of very low electricity costs.
---------------------------------------------------------------------------
    \3\ Black and Veatch, ``20 Percent Wind Energy Penetration in the 
United States'' (October 2007).
---------------------------------------------------------------------------
    Clearly, more work is necessary. Wind power is still constrained by 
difficulties in market acceptance and the need for improvements in 
cost, performance, and reliability. DOE's 20-percent wind energy by 
2030 report assumes that capital costs must be reduced by 10 percent 
and that turbine efficiency must increase by 15 percent to reach the 
goal of providing 20 percent of our Nation's electricity from wind by 
2030. The DOE report identifies a need for continued Federal investment 
in wind RD&D by stating, ``In a functional sense, wind turbines now 
stand roughly where the U.S. automotive fleet stood in 1940''.\4\ As 
our Nation turns to wind power to meet more of its energy needs, it is 
important for DOE to increase funding to improve wind turbine 
reliability and reduce costs.
---------------------------------------------------------------------------
    \4\ U.S. Department of Energy, ``20 Percent Wind Energy by 2030'' 
(July 2008).
---------------------------------------------------------------------------
    Achieving 20 percent of U.S. electric power from wind, with the 
critical help of RD&D, would:
  --Create 500,000 jobs, generating more than $1 trillion in economic 
        impact by 2030;
  --Reduce natural gas demand by approximately 7 billion cubic feet/
        day--nearly one-half of the current consumption in the electric 
        sector;
  --Decrease natural gas prices by approximately 12 percent, saving 
        consumers approximately $128 billion;
  --Avoid 825 million tons of carbon dioxide emissions in the electric 
        sector in 2030, equivalent to 25 percent of expected electric 
        sector emissions; and
  --Reduce cumulative water consumption in the electric sector by 17 
        percent in 2030 (one-third of which would come from the arid 
        West).
    The DOE Wind Energy Program currently receives approximately $79 
million annually. In comparison, the RD&D budgets for many other 
traditional and emerging energy sources are much higher. Non-defense 
nuclear RD&D energy programs receive $775 million, coal programs 
receive about $383 million, and solar and biomass energy receive $243 
million and $216 million, respectively. These are historic imbalances 
in funding that date back to the 1970s. A higher Federal funding level 
for wind energy RD&D will help ensure that wind energy remains 
competitive with other forms of energy.

                   SPECIFIC WIND INDUSTRY PRIORITIES

    Each year AWEA and its member companies identify the RD&D 
priorities that will most effectively help realize the vision of 
providing 20 percent of America's electricity from wind by 2030. The 
following four areas are the wind industry's top priorities in addition 
to the funding that has already been requested in the President's 
budget.
Integration of Variable Power Resources
    The integration of variable power sources, such as wind power, into 
the electrical grid is a key area of focus for meeting the 20 percent 
by 2030 wind energy goal. The systems integration program area focuses 
on the operations issues of integrating variable, nondispatchable power 
sources into the power system. Numerous studies from the United States 
and Europe (with significant involvement from DOE-funded experts) have 
shown that even minor changes to power system operations can 
accommodate much greater amounts of wind.
    Unfortunately, the DOE budget request justification includes a 
reduction in funding for renewable systems interconnection from $14 to 
$3.9 million. The current funding level should be preserved.
Advanced Technology Components
    Advanced technology components, from drive trains to blades to 
towers to controls and sensors, have enormous potential to drive down 
the cost and increase the reliability of all future wind turbine 
systems, not just those located offshore. Such advancements can be 
accelerated and stimulated by DOE, especially as industry deals with 
the current downturn in wind turbine installations. With continued and 
accelerated advancement, studies show that onshore wind turbine 
installations in the United States over the next decade can approach 
150 gigawatts (enough to generate roughly 10 percent of U.S. 
electricity). The reduction in the utility-scale R&D testing budget 
line item indicates a reduced emphasis on these important technologies, 
which instead should be receiving greater attention.
    Wind energy is now cost competitive with virtually every other 
energy source and technology advancements can drive the cost down even 
more. Already, these technology advances have enabled a typical modern 
wind turbine to produce 15 times more electricity than the typical 
turbine in 1990, but further improvements are needed to meet the 20-
percent goal by 2030.
Siting Issues
    The DOE 20-percent report also identified siting issues as a 
potential barrier to achieving that level of deployment. To address 
these issues, the wind energy industry invests millions of dollars 
every year in research related to the interactions between wind energy 
and wildlife, including through a variety of collaborative efforts 
involving Federal and State officials, as well as conservation 
organizations. However, given the importance of resolving siting 
issues, including wildlife-related concerns, to the future of the 
industry, it is necessary and appropriate for DOE to support such 
efforts as well. AWEA recommends devoting $1 million of the DOE R&D 
budget to supporting research on wind energy and wildlife interactions.
Wind Resource Characterization
    Discrepancies between the projected and actual performance of wind 
facilities illustrate the urgent and continuing need for improved wind 
resource characterization methods (modeling and measurements). These 
methods include micrositing to reduce wind turbine wake losses and to 
optimize large wind farm array layouts. These key areas can be 
addressed in the short term to reduce the cost of energy. The DOE 
fiscal year 2012 budget justification includes an increase from $5.7 to 
$7.1 million for this area of research. AWEA endorses this funding 
increase.

                               CONCLUSION

    The President and the Congress have called for a bolder commitment 
to the development of domestic energy resources to meet our Nation's 
growing energy demand. Continued investments in wind energy RD&D are 
delivering value for taxpayers by fostering the development of a 
domestic energy source that strengthens our national security, provides 
rural economic development, spurs new high-tech jobs, and protects the 
environment.
    While the wind industry continues adding new generation capacity, 
challenges still exist. Continued support for DOE's Wind Energy Program 
is vital to helping wind become a more prominent energy source, which 
will benefit the economy and environment. To ensure that funding levels 
are commensurate with our Nation's need for more domestic energy, AWEA 
urges the subcommittee to provide $144.2 million for the Wind Energy 
Program in fiscal year 2012. Along with other key Federal policies, 
both new and sustained, greater RD&D funding through DOE will help 
transform the 20-percent wind vision into a reality.
    AWEA appreciates this opportunity to provide testimony on DOE's 
fiscal year 2012 Wind Energy Program budget before the Senate 
Appropriations Subcommittee on Energy and Water Development. We thank 
the subcommittee for its time and attention to our request.
                                 ______
                                 
          Prepared Statement of Anadarko Petroleum Corporation

    The President's fiscal year 2012 budget includes the elimination of 
funding for the Oil and Gas Research and Development Program at the 
Department of Energy (DOE), as well as a request for legislation to 
repeal section 999 of the Energy Policy Act of 2005, which has created 
a valuable public/private partnership to maximize the value of domestic 
energy resources.
    At this time, when the security of foreign energy sources is 
questionable and the high price of imported energy is damaging the U.S. 
economy, responsible development of domestic resources is a winning 
proposition for the citizens of the United States. The United States 
has vast resources of clean natural gas locked in shale and other tight 
formations, as well as substantial gas and liquid reserves located 
offshore in waters too deep for economic production with current 
technology. Alternative (nonhydrocarbon) energy sources will not make a 
significant contribution to the Nation's energy supply for the next 10 
to 20 years, so our Nation's energy security depends on our ability to 
develop the natural gas resources in a safe and environmentally 
responsible fashion.
    The U.S. oil and gas industry is unparalleled in its ability to 
solve the tough engineering problems associated with oil and gas 
production in challenging environments around the world, but the 
economic development of domestic shale gas and other challenging 
resources requires the development of basic scientific knowledge and 
novel engineering concepts that are best accomplished in partnership 
between industry and the research establishment in the United States. 
The Oil and Gas Research and Development Program in DOE is a hallmark 
of such a partnership. For example, the program was crucial in bringing 
a resource such as coalbed methane from marginally economic status to 
the state of development where it makes a significant contribution to 
the Nation's gas supply, and attracts industry investment without 
Government subsidy.
    The Nation needs this type of research and development investment 
in today's marginally economic resources in order to develop the 
technology that will attract tomorrow's industry investment and ensure 
secure domestic sources for critical energy needs in the near future. 
Now is definitely not the time to eliminate funding for the Oil and Gas 
Research and Development Program at DOE.
                                 ______
                                 
         Prepared Statement of Bob Lawrence & Associates, Inc.

    Madam Chairman and members of the subcommittee: My name is Dr. 
Lloyd R. (Bob) Lawrence, Jr., and I am president of Bob Lawrence & 
Associates, Inc., a consulting firm in Alexandria, Virginia. I 
appreciate the opportunity to come before you today to discuss a key 
infrastructure problem facing our Nation, our electric grid; and a key 
solution, Advanced Conductor Technology. Specifically, I wish to 
discuss two key technological solutions for major grid problems, one 
solution being composite conductor technology, and the second solution 
being High Temperature Superconductor technology. During the past 7 or 
8 years, these two technologies, together, have been funded at an 
annual level of about $25 million. For reasons that are not clearly 
explained or understood, the fiscal year 2012 request suggests zeroing 
out the promising technology advances in these areas. I am here to 
request that the subcommittee restore Advanced Conductor Technology to 
a reduced but needed level of $20 million.
    As you are aware, the backbone of the grid consists of many 
thousands of miles of transmission lines, virtually all of which are 
based on steel core conductors, which are cables constructed with steel 
cores for strength, and wrapped with heavy, aluminum wires which carry 
the electric current. Much of the Nation's electric grid is 40 to 50 
years old, and is in need of modernization and/or expansion to meet the 
growing electrical needs of the country, and the modern need for ultra 
high reliability to service our computer fleet and modern manufacturing 
processes.
    The Congressional Budget Request for the Office of Electricity 
Delivery and Energy Reliability (OE) states that the request is ``OE's 
leadership in developing `next generation' electric grid technologies, 
tools, and techniques.'' Further, the request states that ``today's 
electric grid was designed and constructed in the last century before 
cell phones, personal computers, and the Internet.'' And ``society's 
changing needs have pushed an aging and sometimes congested grid to its 
operating limits.'' Finally, ``A modern electric grid is critical to 
meeting the Nation's energy, environmental, and security goals.''
    The request states, unequivocally, that; ``Without the development 
and deployment of `next generation' electric transmission, 
distribution, and customer technologies, the grid could become a 
barrier to the adoption of cleaner energy supplies and more efficient 
demand-side measures.''
    All that being said, the OE request is for $237,717,000, none of 
which is for research and development on advanced conductors, the basic 
structure of the grid.
    One solution which has shown extraordinary success, with additional 
promise, is the ``composite core'' technology. In this case, the steel 
core of conventional cable is replaced with a composite core providing 
for higher-temperature operation, with lower sag, and higher 
conductivity. The composite, itself, can be one of a number of 
different materials, individually chosen for its individual properties. 
The most successful to date, developed under a joint Department of 
Energy-Industry program is the Aluminum Matrix Technology composite 
core, also known as Aluminum Conductor Composite Reinforced. With a 
one-for-one replacement against conventional, steel core technology, 
the composite core has shown a doubling of electricity carrying 
capacity, with the same sized cable. This, then, allows for the 
doubling of capacity in critical transmission lines without needing any 
additional rights-of-way or additional tower structures. This provides 
huge environmental and permitting advantages, substantially lower cost 
of increased capacity, and a much shorter time from concept to 
operation. The producer of this modern grid option just celebrated the 
1,000th mile of commercial production and installation of ACCR. Due to 
the substantial ratepayer benefits demonstrated to date, further 
research in the composite conductor area is a productive and logical 
path to follow.
    A second solution, which will take additional time for broad entry 
into the electrical marketplace, is High Temperature Superconductivity, 
also known as HTS. Twenty years ago, laboratory scientists were 
ecstatic when a small, centimeter-squared wafer of HTS material could 
be shown to conduct electricity, without resistance, at the temperature 
of liquid helium. Today, according to the OE budget request, the 
technology has come to the point where HTS laboratories have 
``Demonstrated consistent production of second generation, High 
Temperature Superconductivity wire (greater than 300 meters long), with 
70,000 ampere-meters critical current-length. Madam Chairman, I first 
worked on a Government grant in a University laboratory in the fall of 
1964, nearly 47 years ago. I have been involved in Research and 
Development all my life. When you see a technology move forward, 
continuously, such as the HTS technology continues to move, it is not 
logical to cut it off and end its forward motion, when it promises such 
substantial benefits. Worst of all, you will lose the experience, 
knowledge, and corporate memories of the researchers and engineers who 
work on the technology, because they will be on to something else. You 
need to provide the funds to keep the present teams together.
    HTS technology will have its first grid applications in high-
capacity, underground transmission cables, Fault Current Limiters, and 
transformers. Additional benefits will come from the smaller 
``footprint'' required to provide HTS substations. The first grid 
application is likely to be underneath our electrically congested 
cities, where HTS transmission and distribution cables can provide much 
higher electrical capacity in the same electrical conduits presently 
occupied by conventional technology.
    In short, it is in the strong public interest to continue the 
Advanced Cables and Conductors program, addressing both composite 
technologies and high temperature superconductors, at a reduced level 
of $20 million for fiscal year 2012.
    I thank you for your attention to this testimony.
                                 ______
                                 
 Prepared Statement of the Center for Advanced Separation Technologies

    Honorable Chairwoman Feinstein, Ranking Member Alexander, and 
members of the subcommittee, I appreciate the opportunity to submit 
this testimony to your subcommittee on behalf of the Center for 
Advanced Separation Technologies (CAST). The center is a consortium of 
five universities with strong programs in energy and minerals 
resources. I and the representatives of the member universities 
participating in the consortium as listed--Richard A. Bajura--West 
Virginia University; Rick Q. Honaker--University of Kentucky; Peter H. 
Knudsen--Montana Tech of the University of Montana; and Jan D. Miller--
University of Utah--are writing this testimony to request that your 
subcommittee appropriate research funding for advanced separations as 
part of the Fuels Program, Fossil Energy Research and Development, 
Department of Energy (DOE). The advanced separations research is 
mandated by the Energy Policy Act of 2005, title IX, subtitle F, 
section 962.
    In 2010, the U.S. mining industry produced coal and mineral 
concentrates with a sales value of $107.5 billion at the mine mouth. 
These raw materials were used to produce approximately 50 percent of 
the Nation's electricity and various mineral materials worth $578 
billion. According to the 2011 Mineral Commodity Summary published by 
the U.S. Geological Survey (USGS), the value-added mineral materials 
contributed $2.1 billion to the Nation's economy, which accounted for 
14.4 percent of GDP. Further, some of the mineral materials produced by 
the U.S. mining industry are of strategic importance to the development 
of renewable energy resources and the defense industry. Despite the 
importance of the mining industry, there are no federally funded 
research and development (R&D) programs that help the industry to do 
better in meeting the environmental regulations and the national needs.
    I would like to address two major issues the U.S. mining industry 
is facing today. One concerns with the coal industry complying with the 
Clean Water Act, and the other is developing domestic mineral resources 
to supply the rare earth elements (REE) for the energy and defense 
industries.
    In 2009, the United States produced 1.07 billion tons of coal, with 
55 percent of which produced in the Western United States and 45 
percent in the East. The bulk of the mined coal in the East is washed 
in water to remove mineral matter impurities. Burning coal as mined 
incurs a high cost of shipping and produces large amounts of ash, 
SO2, mercury, and other undesirable elements. Most of the 
mineral matter is removed at mine sites, and the efficiency of cleaning 
coal is high for the coarse coal, which is larger than approximately 
0.15 mm in size. However, cleaning finer coal becomes more costly and 
difficult, causing some operators to discard the finer size fraction 
despite the fact that the fine coal refuse contains recoverable coal. 
Some companies recover part of the fine coal using the process known as 
flotation, while discarding ultrafine coal smaller than 0.044 mm in 
size. A recent congressionally directed study conducted by the National 
Research Council (NRC) showed that 70-90 million tons of fine refuse is 
being discarded to 713 active slurry and fresh water impoundments in 
the United States. Assuming that 30-40 million tons of the refuse is 
recoverable coal, the dollar value of the coal wasted in this manner is 
estimated to be $2-$2.6 billion per year.
    A study conducted by DOE in the 1980s showed that approximately 2-
2.5 billion tons of fine coal has been discarded over the years to 
numerous impoundments. The total amounts may be close to 4 billion tons 
by now as the coal industry continued to discard the ultrafine coal 
since the DOE report was written, and the coal production has also been 
steadily increasing. Assuming that roughly one-third of this amount is 
recoverable, the dollar value of the coal discarded in the existing 
impoundments may exceed $100 billion.
    Some companies discard the fine coal slurry to underground mine 
workings, while others store it in large impoundments. There are 
several citizens groups in the Appalachian coal fields opposing to 
these practices by citing violation of the Clean Water Act. Some groups 
contend that the fine coal impoundments represent the worst form of 
valley-fill mining. To address these issues, the West Virginia 
legislature is debating legislation. If the legislature bans permits 
for new impoundments or mandates elimination of impoundments by law, 
the cost of producing coal would rise significantly and can adversely 
affect the Nation's economy.
    A better alternative would be a technological solution. CAST has 
been developing advanced technologies that can be used to help 
companies eliminate the problem at the source, i.e., stop discarding 
fine coal to impoundments or injecting it into old underground 
workings, and further to recover the coal from existing impoundments. A 
series of advanced technologies has already been developed, which 
include the MicrocelTM flotation column, dewatering aids, 
and hyperbaric centrifuge, all of which are marketed commercially under 
appropriate license agreements. The hyperbaric centrifuge was tested at 
pilot scale in 2009, and the successful test results have been reported 
in a DOE Fossil Energy Techline report on February 9, 2010. Encouraged 
by the test results, a first full-scale unit was tested successfully in 
February 2010, in Alabama, and the results have been reported in the 
Techline again on January 4, 2011. On the basis of the successful test 
results, the company has installed additional units for commercial use. 
It is believed that other companies will follow the suite.
    The hyperbaric centrifuge described above is an advanced dewatering 
technology. It is useful for separating spent water from clean coal; 
however it is not designed to remove mineral matter from ultrafine 
coal. Therefore, CAST has been developing a new technology that can 
remove both mineral matter and water simultaneously, so that it can be 
used to recover coal from the fine coal refuse that has been deposited 
in impoundments. Laboratory experiments conducted on ultrafine refuse 
samples consisting of particles that are finer than 0.044 mm showed 
that this new process can be used to reduce the ash contents to 3-4 
percent by weight and the moisture contents to 1-2 percent by weight, 
with 94-98-percent coal recoveries. An international patent application 
has been filed on the basis of the laboratory test results. It is 
necessary, however, that scale-up tests be conducted at 1-3 tons/hour 
capacity before the technology can be commercialized.
    With the remaining pages of this testimony, I would like to address 
the needs for R&D funding to develop advanced separation technologies 
that can be used to recover minerals containing REE from domestic 
resources. China produced 55,000 metric tons of the rare earth oxides 
(REO) in 2009, which accounted for 97 percent of the world production. 
Recently, the Chinese Government announced that it would impose 
production and export quotas for the REO. This new policy created 
serious concerns in the United States and many other countries that 
have been relying on the Chinese export of the rare earths. As shown in 
the CRS report for the Congress (R41744), REEs are critical elements 
for the manufacture of the world's strongest permanent magnets, which 
are essential components of various military weapons systems such as 
precision-guided missiles, smart bombs, aircrafts, etc.
    The United States used to be the world's largest producer of REE 
during 1960s and 1980s. Due to the high cost (mainly labor) of 
production, and the stringent environmental constraints, the production 
shifted gradually to China. However, the United States still has 13 
billion metric tons of reserves. The major rare earth minerals in the 
United States are basinasite ((Ce,La,Y)CO3F) and monazite 
((Ce,La,Y,Th)PO4) that are recovered by flotation. In China, 
the ores containing these minerals are in the range of 4-7 percent, 
which are increased to 50 to 70 percent by flotation. The basinasite 
and monazite concentrates are then treated chemically to extract 
different REOs and rare earth metals.
    As is well known, REEs are not rare. In average, they are more 
abundant than copper and silver except that they do not occur in 
concentrated forms, making it difficult to mine economically. Further, 
the mineral grains are very small, usually smaller than 0.074 mm, which 
also contributes to the high costs of separation (or processing). In 
the United States, the mineable rare earth deposits are found in 
Mountain Pass, California; Bear Lodge, Wyoming; Diamond Creek, Idaho; 
Elk Creek, Nebraska; Lemhi Pass, Idaho-Montana; and also in South and 
North Carolina.
    The key technology that is currently used to separate rare earth 
minerals from associated gangue minerals is flotation, which is also 
used for the separating mineral matter from coal and for the separation 
of one mineral from another in the mining industry. The 
MicrocelTM flotation technology, which has been developed by 
CAST and is used commercially in the coal and base metals industries, 
can also be used for the separation of rare earth minerals. What is of 
critical importance in the flotation separation of these uncommon 
minerals is the control of surface chemistry of the minerals involved. 
If your subcommittee appropriates research and development funding for 
the fiscal year 2012, CAST can develop reagents that can facilitate the 
beneficiation of domestic rare earth mineral resources.
    CAST has also developed a mathematical model for flotation in 
general. Unlike other models developed to date, it is based on first 
principles. Therefore, it has predictive and diagnostic capabilities. 
If funding becomes available, a model-based computer simulator will be 
developed for applications to the separation of rare earth minerals.
    As noted above, CAST has developed a novel separation process for 
fine coal cleaning, in which both mineral matter and water can be 
separated simultaneously from coal. This process is more selective than 
flotation, particularly for the separation of fine particles. This 
process can be further developed to recover rare earth minerals.
    CAST is a premiere research center for developing advanced 
separation technologies for the minerals and coal industries. Many of 
the technologies developed at the center are commercially used in the 
industry. Some of the technologies developed more recently will be able 
to help the coal industry stop the practice of discarding fine coal to 
the environment and at the same time maximize the utilization of a 
valuable energy resource. Further, they can also be used to recover 
coal from the 4 billion tons of fine refuse that has been discarded in 
numerous impoundments and thereby create jobs. CAST also has acquired 
expertise to develop separation technologies that can be used to 
produce REE from domestic resources, so that the United States can 
continue developing renewable energy resources and secure the defense 
industry.
                                 ______
                                 
      Prepared Statement of the Coal Utilization Research Council

                              INTRODUCTION

    This statement is submitted on behalf of the membership of the Coal 
Utilization Research Council (CURC), an organization of coal-using 
utilities, coal producers, equipment suppliers, universities and 
institutions of higher learning, and several State government entities 
interested and involved in the use of coal resources and the 
development of coal-based technologies.\1\ Members of CURC have 
developed, together with the Electric Power Research Institute (EPRI), 
a Technology Roadmap that defines a research, development, and 
demonstration (RD&D) program that focuses upon the rapid development of 
cost-effective advanced coal and carbon capture and sequestration (CCS) 
technologies (www.coal.org) and the recommendations discussed in this 
testimony are keyed off this program.
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    \1\ Several members of CURC are not-for-profit organizations 
designated as such for Federal tax law purposes. Such organizations are 
prohibited in whole or in part from undertaking advocacy activities 
with respect to Federal Government appropriations. This written 
statement could be construed as such an activity. Membership 
contributions made to CURC by these organizations are not used for 
these advocacy purposes; rather such contributions are utilized to 
undertake analyses and other educational activities as provided by 
CURC.
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 IMPORTANCE OF THE DEPARTMENT'S FOSSIL ENERGY RESEARCH AND DEVELOPMENT 
                                PROGRAM

    The President recently announced his intent to launch a program 
aimed at achieving domestic energy security by increasing the 
production of America's domestic energy resources, and by producing 
them in a manner consistent with responsible stewardship of the 
environment. In order to fuel our recovering economy and ensure jobs 
are created, coal must be a part of the President's program. In turn, 
the Department of Energy's (DOE) Fossil Energy RD&D program is 
fundamental to ensuring coal will play a vital role in our Nation's 
energy future.
    The Department's coal RD&D program seeks to develop more efficient 
and cleaner advanced coal technologies, including technologies to 
capture and store CO2 emissions from the use of coal. The 
Department's program has a proven track record of partnering with 
industry to overcome the challenges of using coal and controlling its 
emissions. The proof of this successful partnership is evidenced by the 
fact that since the inception of the Clean Air Act in 1970, the use of 
coal in this country has increased by more than 200 percent while the 
emissions of criteria pollutants has decreased by an average of 88 
percent. This success is largely attributable to our Nation's 
continuing investments in the RD&D of clean-coal technologies.
    Similarly, the actual tons of coal used in the United States are 
expected to increase over the next several decades. The challenge is to 
accompany these increases in coal use with the development of 
technologies to address environmental concerns at lower and lower 
overall costs. Successful technology investments will enable the Nation 
to continue to reap the economic and energy security benefits 
associated with use of our most abundant domestic fossil fuel resource 
in a manner that is respectful of the environment. It also means that 
the United States will retain technology leadership in the use of coal 
and this can mean exporting products, growing jobs, and assuring that 
developing economies that use coal will have access to technologies 
that assure a low carbon and overall environmental footprint.

 COMMENTS ON SIGNIFICANT ISSUES RELATED TO THE FISCAL YEAR 2012 BUDGET 
                                REQUEST

    The programs administered and supported through the Department's 
Fossil Energy office have been distinguished by efforts to foster 
partnerships with industry RD&D efforts, as well as a broad spectrum of 
university research organizations. These programs between industry, 
government, and the academic community have enabled participants to 
actively engage in each part of the technology development chain from 
basic research to applied research and development (R&D), and 
culminating in large-scale technology demonstrations and early 
commercial deployment. During the past several years, a principal focus 
of the DOE's coal R&D program has been the capture and storage of 
carbon dioxide. CURC members have participated in the DOE CCS related 
activity, and will continue to support that RD&D. However, the Nation 
faces additional energy and environmental challenges which would also 
be amenable to collaborative coal-related RD&D by Government and the 
private sector, and these challenges may be more immediate that the 
climate challenge. We recommend greater balance between support for 
CCS-related activities and other coal-related RD&D, as set forth below.

                        SPECIFIC RECOMMENDATIONS

    The Energy Information Administration (EIA) projects that coal will 
continue to provide more than 40 percent of our Nation's electricity in 
2035. And yet, despite the enormous contributions that the Department's 
Fossil Energy program has made to the development and successful 
commercialization of clean-coal technologies, the President's fiscal 
year 2012 budget recommends a 30-percent decrease in funding from 
fiscal year 2010 levels. Understanding the shared desire to constrain 
discretionary spending, we believe that it would be counterproductive 
to reduce Federal investment which results in lower-cost electricity 
and increased competitiveness of American goods. At a minimum, CURC 
recommends that the budget be maintained at the fiscal year 2010 level 
of $400 million for the coal R&D program, and that additional resources 
be appropriated to put us in a position to conduct second-generation 
technology demonstrations by 2016.
Department of Energy Proposal To Restructure the Coal Research, 
        Development, and Demonstration Program
    CURC believes that the proposed restructuring of the DOE coal RD&D 
program provides more transparency on the types of activities that are 
under the portfolio of each program area, and provides specific 
recommendations on those programs as proposed under the fiscal year 
2012 budget restructuring:
Demonstrations
      Clean Coal Power Initiative.--For the third consecutive year, the 
        administration did not request funding for large-scale 
        demonstrations of advanced coal technology on the basis of 
        funding provided by the Recovery Act for Clean Coal Power 
        Initiative (CCPI) Round III. As with other new and emerging 
        technologies supported by the Department, support cannot be 
        discontinued with this limited number of demonstration 
        projects. A sustained and expanded demonstration program is 
        integral to the commercialization of advanced coal and CCS 
        technologies. In its proposed program plan, the Department 
        suggests that CCPI Round IV must be initiated in 2016 if the 
        programmatic goal of demonstrating second-generation 
        technologies by 2020 is to be achieved. Incremental funding for 
        the CCPI IV program must be provided in the fiscal year 2012 
        budget, and each year thereafter, in order to initiate a CCPI 
        Round IV program in 2016.
      FutureGen.--Funding for FutureGen has been made available through 
        the Recovery Act. CURC reiterates its support for this project 
        as an important and necessary step in the demonstration of an 
        integrated CCS system. This type of government-supported 
        project is vital to make CCS a commercial reality.
Power Systems Research and Development
                Carbon Storage
    CURC recommends an increase of $10 million more than the 
President's request for a total of $125.5 million. This increase 
corresponds with the funding recommended in the CURC-EPRI roadmap and 
will allow for the Phase III Regional Carbon Sequestration Partnership 
tests to proceed as planned, and will allow a reasonably robust set of 
projects to be selected in the current small-scale-test funding 
opportunity announcement. The program should emphasize beneficial use 
of carbon dioxide for hydrocarbon recovery to accelerate the 
development of the infrastructure needed to permit full-scale 
deployment of CCS in the future.
                Advanced Energy Systems
      Advanced Combustion Systems.--This program should support 
        development of technologies that increase the efficiency of 
        coal conversion to energy and contribute to reducing the costs 
        of carbon capture from combustion-based power generation, for 
        both new and existing steam powerplants. CURC recommends that 
        the budget be increased by $20 million (for a total of $30.7 
        million) in fiscal year 2012 as follows:
    --Restore the materials budget for ultrasupercritical (USC) (high 
            temperature and pressure) boilers/steam turbines back to $5 
            million. Without an increase, this program will be phased 
            out and there will be no path forward toward a highly 
            efficient, USC demonstration plant in the United States. 
            Without DOE completing this program, the United States will 
            lag behind India, China, and Japan on technology and 
            competitiveness.
    --Add $5 million for efficiency and heat rate improvements (beyond 
            just higher-steam temperature conditions) for both existing 
            and advanced plants. Efficiency improvements are a 
            fundamental step toward zero emission power and contribute 
            toward reduced conventional emissions, reduced 
            CO2 emissions, and lower cost CO2 
            capture systems.
    --Increase the Advanced Combustion Systems budget for oxy-firing 
            systems by $10 million. The proposed fiscal year 2012 
            budget is well below the CURC-EPRI Roadmap and inadequate 
            to fund both continuing oxy-fired projects plus a new 
            funding opportunity that will focus on second-generation 
            oxy-fired technologies.
      Gasification Systems.\2\--DOE studies have shown that integrated 
        gasification combined cycle (IGCC) with carbon capture has the 
        potential to achieve a cost of electricity at parity with 
        current new coal generation without CCS. Achieving this goal 
        requires:
    --technology improvements that reduce the parasitic losses of 
            carbon capture;
    --reduction of IGCC base cost through advanced modeling and 
            construction techniques; and
    --increasing gasifier availability to 90 percent.
      The proposed fiscal year 2012 budget reduction will add years and 
        uncertainty to the schedules for validation and commercial 
        availability of currently identified improvements, and it does 
        not provide funding for new solicitations needed to advance 
        technology innovations. CURC recommends that the fiscal year 
        2012 gasification systems budget be increased by $26 million, 
        for a funding total of $64.9 million, to support new RD&D 
        opportunities that improve gasifier availability ($10 million); 
        achieve major cost reductions ($10 million); and improve cost 
        and performance for gasification-based coal conversion to 
        chemicals and fuels ($6 million).
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    \2\ It is also important to note that advances in this area not 
only support advanced IGCC, but support all gasification programs in 
general, including industrial gasification, biomass gasification, 
hydrogen and fertilizer production, SNG, and coal-to-liquids programs 
and to these ends this program should encompass the concept of advanced 
gasification technology.
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      Advanced Turbines.--CURC recommends that the Advanced Turbine 
        program be increased by $17.4 million for a total of $32 
        million. The Department has been partnering with industry to 
        develop the latest generation of advanced gas turbines (the 
        ``G'' and ``H'' class of turbines), but these turbines are not 
        yet ready to meet the demands of IGCC plants with high levels 
        of CO2 capture. Reduced funding in the last few 
        years has delayed progress and jeopardized DOE's goal of 
        developing advanced turbines capable of improving the total 
        efficiency of an IGCC plant by 5 percentage points by 2015. The 
        proposed reductions to the turbine budget will lead to an even 
        more significant delay in meeting the 2015 targets. These gas 
        turbine technologies will be at risk of not being ready for the 
        next CCPI demonstration program opportunity; thereby, extending 
        the availability of critical technologies to help lower the 
        cost of IGCC well into the next decade.
      Fuels.--Although the President's budget proposes to cut this 
        program, CURC recommends the addition of $20 million to 
        continue coal conversion RD&D under the fuels program. In 2008, 
        we spent $388 billion on imported petroleum products, or 57 
        percent of our balance-of-trade deficit. Production of liquid 
        transportation fuels from 60-percent coal and 40-percent 
        biomass could provide 3 million barrels per day of gasoline 
        equivalent by 2020. This program would create new jobs through 
        increased coal production, operating coal-to-liquid plants in 
        widely dispersed geographic locations, and bolster our 
        national, energy, and economic security through producing 
        indigenous fuels. Coal plus biomass fuels meet the requirements 
        of the Energy Policy Act of 2007 and have been shown to be net 
        carbon sinks regarding carbon emissions. Funding should be 
        directed toward simulation modeling and pilot plant testing on 
        eastern, mid-content, and western coals, biomass 
        characterization and feeding, and transformational research to 
        reduce the energy penalty costs of conversion processes and 
        plant capital costs which are currently a deterrent to 
        implementation coal to liquids technologies.
            Carbon Capture
      Postcombustion Capture.--CURC agrees with the administration's 
        request for fiscal year 2012 of $55.5 million for this program. 
        However, funding should also target concepts at pilot scale as 
        well as lab scale. In this program, DOE should also consider 
        the development of technologies that capitalize on the use of 
        hardware being installed or planned for other uses at existing 
        facilities and that seek to co-benefit emission reductions that 
        may achieve capture levels of less than 90 percent from flue 
        gas streams. Technologies that have the ability to achieve 
        incremental reductions at lower costs of electricity should be 
        considered as part of the broader CCS goals of the DOE program.
      Pre-Combustion Capture.--CURC agrees with the administration's 
        request for fiscal year 2012 of $13.4 million for this program. 
        Likewise for pre-combustion capture, funding should be robust 
        and target concepts at pilot scale as well as lab-scale.
Cross-Cutting Research
    CURC recommends that funding for the Cross-Cutting Research program 
be increased by $15.4 million (for a total of $54.15 million) to 
support the following activities that will develop the next generation 
of advanced coal plants:
  --increase the budget for high-performance materials research from 
        $0.973 to $5 million in order to support development of new 
        high-temperature and pressure materials that will allow coal 
        plants to generate electricity much more efficiently and, 
        therefore, reduce overall emissions of both criteria pollutants 
        and greenhouse gas emissions;
  --increase funding for university coal research from $2.4 to $4.8 
        million to ensure there is a foundation for innovation with our 
        university partners in developing advanced coal technologies; 
        and
  --provide $5 million in funding for a water management research 
        program to develop technologies that reduce water consumption 
        for powerplant cooling.
    The new emphasis upon computational modeling in the DOE program is 
conceptually attractive as a means to evaluate different concepts that 
are being developed in the coal research program, and could be useful 
in moving those technologies from basic research into scalable 
component technologies. Modeling is also useful in directing attention 
to targeted areas where further engineering research is needed to solve 
operational problems. While modeling may be successful in reducing the 
amount of time and funding required to develop, demonstrate and deploy 
technology, modeling simply cannot replace practical applications and 
demonstrations of the technology. Members of CURC do not believe that 
modeling and simulation programs should serve as surrogates in lieu of 
demonstrations at any scale that provide real operating results. CURC 
is supportive of efforts to fund the development of computational 
models if the budget is robust enough to fund all of the priorities 
identified in this testimony, but CURC does not believe funding should 
be provided at the expense of funding other R&D and demonstration 
activities.
Title XVII Loan Guarantee Program
    The DOE loan guarantee program is one of several important tools 
that act to reduce the large cost penalty associated with the 
installation of first-of-a-kind advanced coal systems with CCS. Other 
tools, such as the Department's CCPI demonstration program, as well as 
investment tax incentives and CO2 sequestration credits, are 
also necessary and equally as important, as these financial assistance 
programs must in some cases be used in combination in order to bring 
down the cost of first of a kind projects and/or provide different 
value to different business models, and therefore some tools may be 
used over others for specific projects and entities. CURC recommends 
that additional authority for fossil energy projects be provided in the 
fiscal year 2012 budget to ensure this tool is available to support the 
deployment of new fossil-based projects.
                                 ______
                                 
        Prepared Statement of the Colorado Oil & Gas Association

    The Colorado Oil & Gas Association (COGA) is submitting written 
testimony to express our concern with the President's fiscal year 2012 
budget request to eliminate funding for the Department of Energy's 
(DOE) Oil and Gas Research and Development Program (R&D program). COGA 
is worried that defunding a program designed to ensure the United 
States is able to take full advantage of clean and abundant domestic 
energy sources will curtail innovative technology, slow economic 
recovery, and increase our dependence on foreign energy sources.
    COGA is a Colorado nonprofit corporation formed to foster and 
promote the beneficial, efficient, responsible and environmentally 
sound development, production, and use of Colorado oil and natural gas. 
Colorado's oil and gas industry contributes to the economic recovery by 
supporting more than 190,000 jobs for families and much-needed revenues 
for State and local governments while providing Americans with clean, 
safe, affordable, and abundant domestic energy sources. The 
ramifications of defunding the R&D program will be felt across the 
Nation, including Colorado which has recently had vast amounts of 
extractable resources become economical because of technological 
innovation.
    Since the late 1970s the DOE has engaged in research and 
development for oil and gas, making valuable contributions to 
development of our vast domestic energy resources. DOE projects have 
achieved success in increasing exploration and production; addressing 
environmental protection through reduction of environmental impacts; 
and in the development of ``game changing'' technology such as fuel 
cells, gas turbines, and infrastructure improvements. Projects funded 
through the R&D program are essential to promote efficiency and 
responsibility in the extraction of our natural resources. Without 
adequate investment, domestic development of innovative technology will 
be hindered and further benefits go unrealized.
    The market alone will not drive technological and environmental 
innovations in the oil and gas industry. While many of the ``majors'' 
(large companies with refining and marketing capabilities) engage in 
research and development, the reality is that 90 percent of all oil and 
gas wells are owned by independents (operations primarily dedicated to 
exploration and production). Although varied in size, the vast majority 
of independents do not have the resources to engage in research and 
development. Thus, without economic encouragement industry research and 
development is likely to yield lesser benefits.
    Additionally, the R&D program is essential in promoting cleaner and 
more environmentally friendly ways to extract oil and gas resources. 
Many independents lack the resources to pursue these R&D endeavors, 
thus technology to mitigate potential environmental disturbances is 
unlikely to reach its full potential.
    Increasing domestic oil and natural gas production will result in 
increased support for independent producers, less reliance on imported 
oil, and increased government revenues from royalties and taxes. We 
believe that our tremendous domestic oil and natural gas reserves 
provide a significant opportunity for the United States to reduce our 
dependence on foreign oil while reducing environmental impacts 
associated with energy development. But to do this, we need to work 
together in developing technology to ensure we have the energy to power 
our future. Thus, COGA respectfully urges the subcommittee to 
reconsider the proposed defunding of the DOE Oil and Gas Research and 
Development Program.
                                 ______
                                 
                   Prepared Statement of Cummins Inc.

    Cummins Inc., headquartered in Columbus, Indiana, is a corporation 
of complementary business units that design, manufacture, distribute 
and service engines and related technologies, including fuel systems, 
controls, air handling, filtration, emission solutions, and electrical 
power-generation systems. The funding requests outlined below are 
critically important to Cummins' research and development efforts and 
would also represent a sound Federal investment toward a cleaner 
environment and improved energy efficiency for our Nation. We request 
that the subcommittee fund the programs as identified below.

                     OFFICE OF VEHICLE TECHNOLOGIES

    Advanced Combustion Engine Research and Development.--Increase the 
request of $49 million by $20 million to bring the program total to $69 
million in fiscal year 2012, $56 million was appropriated in fiscal 
year 2010. Two important areas of research included in the Advanced 
Combustion Engine research and development (R&D) are:
  --the development of more energy-efficient technologies for diesel 
        and gas engines, which will contribute to petroleum use 
        reduction; and
  --the development of robust engineering design tools for large-scale 
        computational combustion analysis to develop cost-effective and 
        -efficient combustion engines.
    Light duty trucks continue to be a large segment of the surface 
transportation fleet. The Department of Energy launched the Advanced 
Power Train (APT) light duty (LD) initiative to reduce fuel consumption 
in this sector. The goal of the APT-LD program is to deliver cost-
competitive technologies for a standard light duty pickup truck which 
can achieve at least a 40-percent improvement in fuel economy over the 
state-of-the-art gasoline engines while meeting Tier 2 Bin 2 tailpipe 
emissions (the same emissions standard required for gasoline powered 
vehicles). Class 2a trucks consume nearly 3.9 million oil barrels/day 
of petroleum fuel. A fuel efficiency enhancement of 40 percent can 
reduce petroleum consumption by 1.5 million oil barrels/day. This 
enhancement will provide energy security by lowering petroleum imports, 
greenhouse gas (GHG) emissions and the trade deficit. Innovative high-
risk technologies, such as low-temperature combustion, variable-valve 
actuation and closed-loop selective catalytic reduction controls are 
planned under this project. The funding increase will address 
significant technology hurdles in the areas of on-board diagnostics, 
parasitic loss reduction, after-treatment requirements, and the use of 
renewable fuels. Without the increased funding, research activities 
would be significantly limited. We understand the President's budget 
would provide $10 million in funding for the APT-LD program. We believe 
$15 million is needed in this area to adequately cover all R&D 
activities.
    Advanced Computing, a large-scale computational simulation 
initiative, is targeted at achieving cost-effective means for even 
greater fuel efficiency; 60-percent thermal efficiency engines. Models 
will be developed for advanced chemical kinetics, computational fluid 
dynamics and large eddy simulations. These models will simulate 
advanced combustion regimes, transient events and cycle-to-cycle 
variability. Development of better solver algorithms will minimize 
cycle-to-cycle variations and more rapid optimization of overall 
engine.
    These projects are in line with the administrations investment in 
clean-energy technologies to reduce dependence on foreign oil. We 
understand the Department of Energy (DOE) intends to allocate $15 
million out of the Advanced Combustion Engine budget to fund Advanced 
Computing. We support this allocation. However, adequate funds do not 
exist with Advanced Combustion Engine to cover this activity. 
Therefore, we are requesting and additional $15 million in funding to 
cover these important activities.

               OFFICE OF INDUSTRIAL TECHNOLOGIES PROGRAM

    Industries of the Future (Crosscutting)/Next-Generation 
Manufacturing Processes, Combined Heat and Power Generation --Advanced 
Reciprocating Engine Systems.--The Combined Heat and Power (CHP) 
Generation budget line includes the important Advanced Reciprocating 
Engine Systems (ARES) program funded at approximately $10 million in 
fiscal year 2012. We request that ARES program funding be increased by 
$3 million to $13 million in fiscal year 2012. The ARES program is an 
important component of distributed generation and has applications in 
CHP. The objective of this industry cost-shared program is to develop 
high-efficiency, low-emissions, and cost-effective technologies for 
stationary engine systems (500-6,500 kW) that can use natural gas or 
domestic renewable resources ``opportunity'' fuels. Natural gas-fueled 
reciprocating engine powerplants are preferred for point-of-use power 
generation, low-operating costs, and reliability. Opportunity fuels can 
be renewable fuels (e.g., landfill gases) which exhibit low BTU, lower 
methane number, and varying gas composition. Their use reduces the 
dependence on high-quality pipeline natural gas. Technologies sponsored 
by the ARES program have demonstrated 47-percent engine efficiency (a 
20-40-percent increase from the baseline engines), higher-power 
densities than current products, with an expected reduction in life-
cycle costs and GHG emissions. Recent technology advances include 
advanced ignition systems, analytical tools for optimum combustion and 
prediction of onset of knock in a field test generator set. The funding 
increase in the fiscal year 2012 budget will support advanced 
technology challenges including combustion enhancements with low BTU 
and methane gases, nitrogen oxides (NOX) reductions, 
advanced sensors and controls, hardware durability, and lower life-
cycle costs. The development of distributed power generation supports 
national energy security needs, improves protection of critical 
infrastructure and decreases dependence on the national electrical grid 
system through point-of-use energy production.

 INDUSTRIES OF THE FUTURE (CROSSCUTTING)/NEXT-GENERATION MANUFACTURING 
                   PROCESSES, COMBINED HEAT AND POWER

    Support the Request of $25 Million in Fiscal Year 2012.--$24.7 
million was appropriated in fiscal year 2010. This project is to 
develop a flexible CHP system which can be deployed in commercial and 
light industrial (100-500kW) applications at a lower total cost of 
ownership. CHP systems offer higher system energy efficiency, lower 
emissions, and economic benefits. Combined heat and power systems use 
an internal combustion engine to produce electricity at point-of-use 
and recover waste heat for heating or cooling purposes. Energy 
intensity of the CHP systems can be reduced in excess of 35 percent due 
primarily to more efficient electrical generation and recovered waste 
heat. Modern engine designs operate with much lower regulated exhaust 
emissions and carbon dioxide. The fiscal year 2012 budget will support 
CHP performance modeling, cost-effective package design, remote 
modeling, and CHP system integration. The project will result in a 
system that is easy to use and inexpensive to install, while providing 
the lowest-emissions internal combustion natural gas engine for a CHP 
system of this size.
    Advanced Combustion Engines--Health Impacts.--No funds were 
requested by the administration for this program. We request an 
increase of $2 million to bring the program total to $2 million in 
fiscal year 2012. The objective of this program is to expand the 
knowledge base relating to the heath implications of emissions 
technologies being developed to meet energy-efficiency goals. The 
Advanced Collaborative Emissions Study (ACES) is funded under this 
program. The ACES program is a cooperative effort between Government 
(DOE, Environmental Protection Agency) and industry (EMA, MECA, API) to 
assess health effects of emissions from 2010 compliant heavy-duty 
engines. The ACES program will include emissions characterization, 
chronic exposure animal bioassays, and identification of any 
unanticipated emissions or health effects from new engine technologies. 
Continuous monitoring of air toxins and source apportionment techniques 
are also proposed.
                                 ______
                                 
           Prepared Statement of the Diesel Technology Forum

    The Diesel Technology Forum (DTF) www.dieselforum.org is a not-for-
profit organization representing diesel engine and equipment makers, 
fuel suppliers and emissions control technology companies. We 
appreciate the opportunity to submit comments regarding certain aspects 
of the fiscal year 2012 proposed budget of the U.S. Department of 
Energy (DOE), particularly its Vehicle Technologies Program (VTP) and 
its various budget activities for commercial vehicles, advanced 
combustion engine research and development (ACE R&D), fuels technology 
and materials research.
    The fiscal year 2012 energy efficiency and renewable energy (EERE) 
budget proposes to substantially reduce investments in several key 
budget activity areas that impact heavy-duty diesel engines, commercial 
vehicles and truck efficiency programs. This includes ACE R&D (reduced 
12.4 percent from fiscal year 2010 appropriated levels; $55.987 million 
to $49 million); a reduction of $5 million for fuels technologies; and 
reduction of $2-$3 million in materials technologies.
    Because of well-established future need, proven past performance, 
and extended societal benefits, funding for Vehicle Technologies 
Programs including ACE R&D, fuels and materials technologies and 
SuperTruck activities has delivered proven benefits and must be 
restored.
    The subcommittee faces a difficult task of setting priorities among 
many competing programs with limited resources. The subcommittee should 
seek to strike a better balance between fully funding programs that are 
known to improve efficiency of existing energy-intensive sectors on a 
near-term basis while at the same time supporting a reasonable vision 
and funding for infrastructure development, deployment and 
electrification of passenger vehicles; the potential energy-saving 
benefits of which may not be realized for several decades or more. We 
recognize that savings will need to be found across all programs but 
are concerned about the disproportionate impact on proven existing 
programs while unprecedented significant new resources are being 
requested elsewhere for new initiatives.
    The commercial vehicle research activities have been cross-cutting 
in scope and shared risk and benefits between DOE, private industry, 
Department of Defense (DOD), Department of Transportation (DOT)and the 
Environmental Protection Agency (EPA). This suite of programs to make 
commercial vehicles more energy efficient--the 21st Century Truck 
Partnership and diesel engine and fuel research--have been among DOE 
EERE's most successful investments. They are proven to have helped meet 
important societal goals of economic growth and small business 
development (economics of more energy efficient commercial truck 
acquisition and ownership); cleaner air (reducing diesel engine 
emissions), reduced reliance on imported oil (increasing commercial 
truck energy efficiency). They have also enhanced our national 
security, through contributing to fuel savings of DOD military 
vehicles. Fuel accounts for 70 percent of the bulk tonnage transported 
to the battlefield and reducing consumption by 1 percent leads to 6,500 
fewer soldier trips, which has been identified with saving lives on the 
battlefield through reduced risk in transporting fuel.\1\
---------------------------------------------------------------------------
    \1\ Bochenek, Grace. ``U.S. Army Tank Automotive Research 
Development and Engineering Center, 2010''.
---------------------------------------------------------------------------
      Existing Department of Energy Energy Efficiency and Renewable 
        Energy Commercial Vehicle and Engine Programs Have Delivered 
        Substantial and Proven Economic, Environmental and Energy 
        Saving Benefits.--For every $1 invested, advanced combustion 
        research delivered $53 in benefits. According to a May 2010 
        study \2\ previous advanced combustion research for laser and 
        optical diagnostics along with combustion modeling undertaken 
        by the DOE and now having been implemented in commercial 
        vehicles on the road today saved 17.6 billion gallons of diesel 
        fuel over a 12-year period (1995-2007); a 4.5-percent savings 
        in fuel consumption more than what would have occurred without 
        the program investments. This translates into a monetized 
        saving of $34.5 billion in 2008 dollars, and reduction of more 
        than 177 million tons of CO2 prevented.
---------------------------------------------------------------------------
    \2\ Link, Albert N. ``Retrospective Benefit-Cost Evaluation of U.S. 
DOE Vehicle Combustion Engine R&D Investments, Department of Economics, 
University of North Carolina at Greensboro''; May 2010.
---------------------------------------------------------------------------
    The established goal of improving fuel economy by 20 percent for 
commercial vehicles in the ACE R&D has the potential to save more 
energy than the electrification of 1 million cars. Past investments 
have contributed to diesel engine manufacturers being able to meet the 
most stringent emissions standards on record, resulting in today's 
clean diesel technology with near zero emissions of ozone forming 
compounds (nitrogen oxides) and particulate matter. The total health 
and environmental benefits in terms of savings in air pollution and 
energy savings exceed $70 billion according to the previously 
referenced May 2010 study.
      The Ongoing Need To Reduce Energy Consumption From Commercial 
        Vehicles is Well Established.--Heavy-duty commercial trucks 
        play the central role in the Nation's freight movement and 
        goods delivery system, transporting 70 percent of the U.S. 
        goods purchased. Diesel-power will be the primary technology of 
        choice for providing this service in the foreseeable future due 
        to its unmatched combination of efficiency, power, performance, 
        reliability, and durability along with economical ownership and 
        operation. Tractor-trailer type trucks (Class 8) use 80 percent 
        of commercial trucking industry fuel. This accounts for 28 
        percent of total U.S. fuel usage. According to DOT, from 1970-
        2007, the number of trucks more than doubled while the mileage 
        increased by 3.9 percent during the same period. Economic 
        growth and recovery demands more trucking services, more miles 
        traveled and more energy consumption. These past and predicted 
        future trends underscore the need for continued gains in fuel 
        efficiency benefits from continued future investments in 
        commercial truck and diesel engine efficiency. Further, 
        according to the Advanced Energy Outlook (Figure 2, below) with 
        a 75-percent reduction in light-duty oil consumption; heavy-
        duty vehicles will make up the largest share of the consumption 
        in the future. As global commodity, heavy-duty petroleum 
        consumption already rivals that of light-duty vehicles. U.S.-
        developed fuel efficient technology for commercial vehicles 
        through the EERE has had and will continue to have a global 
        impact, adding much greater leverage on petroleum demand and 
        cost on a global scale.

        
        

 Figure 1. The Nation's economy is linked to truck transport. Source.--
                      Argonne National Laboratory.

      Future Societal and Technological Challenges Facing Commercial 
        Vehicles are Significant, and Heighten the Need for Continued, 
        Robust Government Energy Efficiency and Renewable Energy 
        Program Investments.--A landmark final rule from the EPA and 
        DOT--National Highway Traffic Safety Administration (NHTSA) is 
        expected in July 2011 that will establish the first-ever 
        greenhouse gas emissions reduction requirements for commercial 
        trucks. Goals for near and long-term reductions in greenhouse 
        gas emissions and fuel efficiency improvement will be 
        established at that time and will likely stretch the limits of 
        currently known technology capabilities. The significant 
        funding reductions in the suite of EERE commercial vehicle and 
        engine programs in the fiscal year 2012 budget could delay or 
        jeopardize gains in meeting these important societal goals.

        
        

Figure 2. Internal DOE analysis, August 2008, comparing Heavy Truck oil 
 consumption at AEO 2008 reference case levels with a 75% reduction in 
high-duty oil consumption relative to EIA's AEO 2008 reference case due 
 to significant light-duty fuel economy gains and fuel switching. (p. 
                                  21)

    Reaching these challenging goals will require substantial 
manufacturer investment in the next 3-5 years at a time when economic 
recovery and market potential for heavy duty commercial trucks remains 
tentative. More than ever, the combined collaborative approach of the 
DOE program of shared research toward common energy saving objectives 
is needed and necessary to assure continued progress and increase the 
speed of development, deployment of technologies, and societal 
benefits.
      Fully Funding Commercial Vehicle Research Budgets Assures 
        Continued Gains and Leverage of Ongoing Progress That Will Help 
        Expedite Fuel-Saving Technology Development and Deployment 
        While Managing Risks That Will Lead to Greater Future Fuel 
        Savings.--Given the substantial progress made in the 21st 
        century truck program, a framework of continuous progress has 
        been developed over time that is a predictive indicator of 
        potential future success. Adequate DOE program funding can 
        assure that the commercial vehicle, engine and SuperTruck 
        program goals of 50-percent increase in freight efficiency 
        (ton-miles per gallon) will be more likely to be met. Truck and 
        engine manufacturers face the unique challenge of competing 
        societal demands of improved efficiency, near-zero emissions 
        while meeting customer demands for lowest cost of operation. 
        Significant investments in research are required but there are 
        diminishing opportunities to recoup the substantial investments 
        needed to meet these goals with only an average 200,000-250,000 
        heavy duty trucks sold annually. A fully funded SuperTruck 
        program can assure these goals are more likely to be 
        accomplished earlier than if companies alone shoulder larger 
        research demands.
      Commercial Vehicle, Engine and SuperTruck Efficiency Program 
        Benefits Reach Beyond Private Industry in the United States, a 
        Factor To Be Carefully Considered in the Final 
        Decisionmaking.--Collateral benefits have accrued to the 
        Department of Defense from the 21st Century Truck Partnership 
        program through the efficiency advancements extending to 
        military applications and a subsequent reduced dependence on 
        petroleum. Continued funding of the vehicle technologies 
        program, SuperTruck and ACE R&D will have long-term strategic 
        value to reducing petroleum consumption of the U.S. military. 
        The United States is the global leader in advanced clean diesel 
        engines and efficiency gains here in the United States will 
        ultimately impact the global marketplace.

                              CONCLUSIONS

    There is an incontrovertible and established need to improve energy 
efficiency of the Nation's commercial vehicles. Commercial diesel-
powered trucks are the backbone of the U.S. economy and the prime 
movers of the Nation's goods movement system, and will be for the 
foreseeable future. Fuel consumption in this sector is projected to 
continue to grow with the economy. Past EERE engine and vehicle 
efficiency programs have delivered substantial and well-documented 
economic, energy and environmental benefits to society. However the 
continued progress of these efforts is in jeopardy due to an imbalanced 
fiscal year 2012 budget request.
    An adequate Government funding stream for the suite of vehicle 
technology programs like SuperTruck and the ACE R&D, fuels technologies 
and materials must be restored to fiscal year 2010 levels to assure 
continued progress and accelerate development and deployment of energy-
saving technologies. Proposed reductions to the fiscal year 2012 EERE 
funding will jeopardize continued progress at an especially critical 
time as the industry moves to meet new greenhouse gas emissions and 
fuel efficiency goals, near zero emissions levels along with competing 
customer demands with the backdrop of a weakened and recovering 
economy.
    A national energy strategy should seek to balance investments in 
near-term and long-term energy-saving strategies. Proven incremental 
gains in efficiency from existing fuels and technologies, particularly 
in sectors that use the most energy today without viable alternatives 
for the future must be a cornerstone of the national energy program and 
funded accordingly. While battery development and electric-powered 
vehicles may hold great promise, so too should investments in programs 
with assured near-term efficiency gains.
    The diesel engine is the prime mover of America's transportation, 
infrastructure and goods movement today and for the foreseeable future. 
Now near zero emissions and still as the most energy efficient internal 
combustion engine (30-percent more efficient than gasoline), clean 
diesel technology has made great progress and has substantial future 
potential efficiency gains to meet future societal goals.
    We appreciate the opportunity to file these comments. An ongoing 
dialogue with the subcommittee on making best use of limited dollars to 
achieve shared goals of greater energy efficiency while preserving a 
major economic force for the U.S. economy is essential.
                                 ______
                                 
                Prepared Statement of Dr. Steven Bryant

    Defining priorities for Federal research funding is all the more 
important when reductions in overall Federal spending are being 
discussed. One such priority is the small but impactful Strategic 
Center for Natural Gas and Oil within the National Energy Technology 
Laboratory in the Department of Energy.
    The U.S. economy runs on fossil fuel, including 20 million barrels 
per day of crude oil, the greater part of which is imported. But 30 
billion barrels of this essential resource can be extracted from 
domestic reservoirs if improved technology for injecting CO2 
into these reservoirs can be developed. The Strategic Center for 
Natural Gas and Oil has established a visionary program for just this 
purpose.
    Continuation of this program is important for three compelling 
reasons:
  --Recent advances in science and technology outside the oil 
        industry--including nanotechnology, novel synthetic chemistry, 
        and efficient computational methods--have opened up truly new 
        possibilities for substantially increasing recovery of oil by 
        injecting carbon dioxide. The Strategic Center for Natural Gas 
        and Oil has committed to exploiting these possibilities.
  --Independents and small operators, not the majors, are conducting 
        essentially all the carbon dioxide injection for oil recovery 
        in the United States. This segment of the oil and gas industry 
        is eager to take advantage of new technology. But these 
        operators do not have the wherewithal to conduct basic research 
        needed to implement new ideas from outside the industry.
  --Federal funding is a critical mechanism for training the next 
        generation of engineers and scientists who will implement these 
        advanced technologies, working for domestic companies operating 
        domestic oil fields--very good jobs that are a boon to local 
        and regional economies.
    In view of the often strident discussion of budget priorities in 
Washington and the rest of the country, it seems timely to remind 
members of the subcommittee that over the last 60 years the United 
States has a proud history of investing in basic research at its 
universities. That investment has been repaid countless times over. 
Practitioners educated in this way have contributed to a decades-long 
stream of technical innovation which has maintained U.S. leadership of 
the global economy. CEOs from all business sectors are unanimous on 
this point: Without continued innovation, the U.S. economic leadership 
will surely falter.
    Many Federal programs have worthy justifications for their 
continued existence. But few can offer as large a return on the Federal 
investment as this one in the Strategic Center for Natural Gas and Oil. 
Even fewer provide that return in an area of unquestionably vital 
importance to the U.S. economy and national interest: the continued 
supply of domestically produced oil.
                                 ______
                                 
          Prepared Statement of the Edison Electric Institute

    The Edison Electric Institute (EEI) respectfully submits this 
written testimony for the record to the Senate Appropriations 
Subcommittee on Energy and Water Development.
    EEI is the association of U.S. shareholder-owned electric 
companies. Our members serve 95 percent of ultimate electricity 
customers in the shareholder-owned segment of the industry and 
represent approximately 70 percent of the U.S. electric power industry.
    EEI appreciates this opportunity to share our views on some of the 
Department of Energy's (DOE) programs for the fiscal year 2012. We 
believe a robust national energy policy that supports the full 
portfolio of energy resources is critical to our country's national 
security and economic growth. Therefore, we respectfully ask the 
subcommittee to direct sufficient resources toward these critically 
important activities.

                        ELECTRIC TRANSPORTATION

    EEI embraces the goal of having 1 million electric vehicles on the 
road by 2015. The United States faces numerous energy policy 
challenges, but perhaps none looms larger than energy security. Ongoing 
conflict in the Middle East and increasing demand as nations' economies 
recover have left crude oil prices hovering around $110 per barrel. 
U.S. drivers are now paying an average of $3.73 per gallon of gas, a 
65-percent increase in 4 months. We strongly support increasing 
domestic oil supply. Turning to electricity as a transportation fuel is 
critical, too.
    The transformation of the Nation's transportation fleet to one 
fueled in part by domestically produced electricity can gradually help 
reduce our dependence on foreign energy sources. Plug-in electric 
vehicles (PEVs) are being rolled out in major U.S. markets, as 
automobile manufacturers join utilities in embracing electricity as an 
important transportation fuel.
    The job creation potential behind electric transportation is 
enormous. As the Nation transitions to a new era of electric 
transportation, demand for jobs in this new technology sector will 
continue to increase. From manufacturing batteries to building the 
necessary electricity recharging stations, PEVs will create high-
quality employment opportunities throughout the country. The Federal 
Government estimates that tens of thousands of American jobs will be 
created to manufacture PEV batteries and components.
    The Congress has a significant role to play in securing a place for 
electric vehicles in the transportation fleet. Federal funding is 
crucial to help break down market barriers to the commercial-scale 
deployment of electric vehicles and related infrastructure. 
Accordingly, EEI supports funding for DOE's PEV vehicle technology 
programming, including battery and electric drive technology 
development and grants to communities for the installation of PEV 
recharging infrastructure.

                             FOSSIL ENERGY

    Coal generates almost 45 percent of our electricity and will 
continue to be an important fuel source for our Nation's electricity 
mix. Coal is the largest domestically produced source of energy in the 
United States.
    EEI urges strong support for carbon capture and storage (CCS) and 
advanced coal technology programs, including loan guarantee authority 
for advanced fossil projects. CCS is a promising and important 
technology that will allow continued utilization of our abundant 
domestic coal reserves to generate a reliable and affordable supply of 
electricity in a cleaner manner. CCS commercialization is still in the 
future, but demonstration technologies hold great promise, and we are 
working with the Congress and the administration to develop policies 
that will accelerate its commercial availability and deployment.

                             NUCLEAR ENERGY

    EEI urges support for DOE's nuclear loan guarantee program and 
recommends approval of the additional $36 billion requested in loan 
volume for nuclear energy projects. Nuclear powerplants generate about 
20 percent of the industry's electricity and are the largest source of 
carbon-free electricity production in the country.

                               SMART GRID

    EEI supports robust funding for smart grid programs. In addition to 
operational benefits such as automatic outage detection and automated 
meter reading, customers with smart meters receive other types of 
benefits, including easier energy management and the potential of the 
electric grid to act as a platform for future energy technologies, 
including plug-in electric vehicles and distributed generation. 
Currently, electric utilities install between 15,000 and 20,000 smart 
meters every day. By 2019, it is estimated that more than 58 million 
smart meters will be in use in more than one-half of all U.S. 
households.
    Deployment of smart grid technology means job creation across the 
economy. Researchers at the Milken Institute point out that smart grid 
construction requires highly skilled labor from various architectural 
and engineering occupations. Because smart grid investments have a 
significant economic impact, technology deployment would revitalize 
employment in research and development and in construction, where more 
that 1.3 million jobs were lost from 2007 to 2009.

         CYBER SECURITY AND PHYSICAL INFRASTRUCTURE RELIABILITY

    Protecting the Nation's electric grid and ensuring a reliable, 
affordable supply of power are EEI's member companies' top priorities. 
Indeed, system reliability requirements are what set electric utilities 
apart from most other industries. Utilities have an obligation to 
serve, to maintain exceptional reliability, and to keep their systems 
secure in an era of increasing cyber threats.
    The electric power industry is constantly making investments to 
strengthen and improve the operations and security of its cyber systems 
and to identify and address vulnerabilities. One research organization 
has projected that global spending on utility cyber security will top 
$21 billion over the next 5 years. Industry in the United States, 
however, cannot go it alone. We urge the Congress to continue public-
private partnerships to help ensure a robust and resilient electric 
grid.

                  TRANSMISSION, SITING, AND PERMITTING

    Siting new transmission is critical for electric companies to be 
able to move power to where it is needed, to maintain a reliable 
electricity system, and to expand access to renewable energy resources.
    In 2009, shareholder-owned electric utilities and stand-alone 
transmission companies invested an unprecedented $9.3 billion in our 
Nation's transmission infrastructure. This represents a 9-percent 
increase more than 2008 levels and an 82-percent increase more than 
2000 investment levels. Since the beginning of 2000, industry has 
invested $68 billion in transmission. We anticipate at least $56 
billion in transmission system investments through 2020.
    The siting of new transmission lines, however, remains a difficult 
and lengthy endeavor, particularly where multiple States or regions 
must approve the project, or when the siting involves Federal lands. 
Sufficient funding to ensure timely coordination between Federal 
agencies and prompt issuance of Federal authorizations and permits is 
essential for a robust transmission system.

                           ENERGY EFFICIENCY

    Utility spending on energy efficiency continues to increase. Over 
the past 3 years, electric utilities doubled their budgets for energy 
efficiency, growing from $2.7 billion annually to $5.4 billion. Utility 
efficiency budgets are expected to reach or exceed $12 billion by 2020.
    As in the past, EEI recommends that Federal funding be used for the 
development and deployment of efficient energy technologies to help 
meet electricity demand growth, while enabling consumers to manage 
their energy usage.

                            RENEWABLE ENERGY

    EEI supports funding for renewable energy research and development 
to help make these resources cost-competitive. The Energy Information 
Administration projects that renewable energy resources will continue 
to increase their share of the Nation's generation mix--from 11 percent 
in 2009 to 14 percent in 2035. Twenty-nine States and the District of 
Columbia have renewable portfolio standards.

                      ENERGY STORAGE AND BATTERIES

    Improved energy storage is critical for enabling the widespread use 
of electric vehicles, efficient, and reliable smart electric grid 
technologies, and variable renewable energy resources. EEI supports 
Federal initiatives to advance and accelerate storage/battery 
technologies.
                                 ______
                                 
  Prepared Statement of the Electric Drive Transportation Association

    The Electric Drive Transportation Association is the cross-industry 
trade association promoting the advancement of electric drive 
technology and electrified transportation and we are writing regarding 
the fiscal year 2012 request for the Department of Energy's (DOE) 
Vehicle Technologies and other electric drive programs.
    Our members include vehicle manufacturers, battery and component 
manufacturers, utilities and energy companies, and smart grid and 
charging infrastructure developers. We are committed to realizing the 
economic, national security, and environmental benefits of displacing 
oil with battery electric, hybrid, plug-in hybrid, and fuel cell 
vehicles.
    Electric drive vehicles, from mild hybrids to full electrics are 
being introduced into the market place in passenger cars; commercial 
trucks, neighborhood electric vehicles, buses; tractors and ground 
support equipment and are poised to advance to commercial scale. As the 
uncertainties roiling the global oil market are spiking the cost of 
gasoline as well as consumer goods in the United States, it is more 
important than ever to push forward in our concerted efforts to 
increase electrification and reduce dependence on imported energy.
    DOE, working with the electric drive industry and other 
stakeholders, is helping to accelerate technology breakthroughs, 
promoting investment in manufacturing capacity and speeding deployment 
of electric drive vehicles and infrastructure.
    The Department's Vehicle Technologies program promotes government/
industry partnerships and leverages private sector investments to 
accelerate technologies that serve our national energy goals. 
Specifically, we support the Department's efforts to advance energy 
storage technologies and the administration's request for the Batteries 
and Electric Drive Technology program, which will develop next-
generation battery technologies that increase performance and bring 
down costs. We further support the proposed level for Vehicle and 
Systems Simulation and Testing programs, including the Advanced Vehicle 
Testing Activity (AVTA), which are advancing next-generation charging, 
systems integration and codes and standard for vehicle to grid 
communication.
    The Vehicle Technologies program is also home to important work in 
reducing the cost and expanding the abilities of medium- and heavy-duty 
electric drive trucks. Recognizing their enormous potential to 
transform the commercial fleet and reduce oil consumption in that 
transportation segment, we ask that the subcommittee direct sufficient 
resources toward program activities that advance electrification of 
medium and heavy duty vehicles, including work with industry partners 
to reduce component costs and further enhance performance.
    Another key focus for DOE advanced vehicle technology efforts is 
fuel cell electric vehicles, which are important zero emission/zero 
petroleum options that will be integral to meeting national goals for 
energy security and reduced emissions. The industry is meeting 
aggressive cost, performance, and deployment milestones as it pushes 
toward commercialization in 2015. A meaningful partnership with the 
Federal research and development community through the Hydrogen 
Technologies Program is critical to keeping that timeframe.
    We believe the fiscal year 2012 budget for Hydrogen should maintain 
the Department's commitment to hydrogen and fuel cell research, 
providing an expanded emphasis on programs that reinforce the vehicle 
commercialization effort. Specifically, we ask that funding for fuel 
cell electric vehicle and infrastructure deployment activities in 
Technology Validation and in early market development, including 
education and other enabling activities, be provided at levels 
sufficient to enable the industry to build on technology and market 
achievements to meet the 2015 target.
    Finally, we strongly support the Vehicle Technologies Deployment 
programs, including Clean Cities' mission of advancing the Nation's and 
energy security by reinforcing communities' own efforts to expand 
deployment of electric drive vehicles (battery electric, hybrid and 
fuel cell electric vehicles), other alternative fuel vehicles and 
recharging/fueling infrastructure. We are pleased that Department's 
fiscal year 2012 budget requests an expansion of these partnerships and 
supports additional resources for communities deploying electric drive 
vehicles and recharging infrastructure.
    Recognizing significant budgetary constraints that the subcommittee 
faces, we respectfully request that the subcommittee make the wise 
investment of resources in the DOE's electric drive programs that will 
enable the Department to continue to be an effective partner in 
accelerating the achievement of a secure and sustainable transportation 
sector.
    We thank you for your consideration.
                                 ______
                                 
    Prepared Statement of the Energy Committee of ASME's Technical 
                              Communities

    Mr. Chairman, ranking member, and members of the subcommittee: The 
Energy Committee (EnComm) of ASME's Technical Communities is pleased to 
provide this testimony on the fiscal year 2012 budget request for 
research and development (R&D) programs in the Department of Energy 
(DOE).

                              INTRODUCTION

    The 125,000-member ASME is a nonprofit, worldwide educational and 
technical society. It conducts one of the world's largest technical 
publishing operations, holds more than 30 technical conferences and 200 
professional development courses each year, and sets some 600 
industrial and manufacturing standards, some of which have become de 
facto global technical standards. The Energy Committee of ASME's 
Technical Communities comprises 40 members from 17 Divisions of ASME, 
representing approximately 40,000 of ASME's members.
    ASME has long advocated a balanced mix of energy supplies to meet 
the Nation's energy needs, including advanced clean coal, petroleum, 
nuclear, natural gas, waste to energy, biomass, solar, wind, and 
hydroelectric power. ASME also supports energy efficient building and 
transportation technologies, as well as transmission and distribution 
infrastructure sufficient to satisfy demand under reasonably 
foreseeable contingencies. Only such a portfolio will allow the United 
States to maintain its quality of life while addressing future 
environmental and security challenges. Sustained growth in the energy 
systems on which the United States depends will also require stability 
in licensing and permitting processes not only for power-generating 
stations but also for transmission and transportation systems.
    A forward-looking energy policy will require enhanced and sustained 
levels of funding for R&D, as well as government policies that 
encourage deployment and commercialization. The Energy Committee 
supports much of the fiscal year 2012 budget request, especially the 
increases in funding for fundamental scientific research. The Energy 
Committee also wishes to emphasize that a balanced approach to our 
energy needs is critical, and this is why we remain concerned about the 
substantial decrease in funding for fossil energy, which is essential 
to meeting our national energy needs now and in the future.

                             FOSSIL ENERGY

    The fiscal year 2012 budget request of $520.7 million for fossil 
energy represents a $206.7 million reduction compared to the fiscal 
year 2010 appropriation; a 44.5-percent decrease. Fossil Energy 
Research and Development (FE R&D) would be reduced by 31.3 percent, or 
$206 million to $452.9 million. The administration continues to point 
out that $3.4 billion was devoted to Fossil Research and Development as 
part of the American Recovery and Reinvestment Act (ARRA), and 
conceding this point, other offices, such as EERE and Science, also 
received funding in ARRA and are slated for substantial increases as 
part of the fiscal year 2012 budget.
    Funding for Natural Gas Technologies and for Unconventional Fossil 
Energy Technologies would again be targeted for elimination by the 
administration. The United States has access to significant 
unconventional gas resources with the potential to provide abundant, 
affordable, clean low-carbon energy source for years to come. Prior FE 
R&D has contributed to making this possible. However, this potential 
will not be realized unless this resource can be produced reliably, 
economically, safely and with minimal environmental impact. 
Accomplishing this task and keeping the United States in the forefront 
of unconventional fossil energy technology will require an investment 
in basic research, technology development, and investments in advances 
in low-impact environmental technologies that will not be undertaken by 
industry in the current economic climate. The budget for these efforts 
should be maintained at least at the fiscal year 2010 level. The EnComm 
encourages a restoration of funding for coal research programs to at 
least the levels appropriated for fiscal year 2010. Coal remains a 
critical resource for our Nation and its economy; however, we must 
continue to invest in technological advancements that will reduce 
environmental impacts for this energy. The use of more efficient 
processes for coal combustion, such as advanced integrated gasification 
combined cycle (IGCC) technology, combined with carbon sequestration 
will allow the United States to utilize its coal resources in a more 
environmentally sound and cost-effective manner. We encourage strong 
and consistent funding for these programs now and in future years. The 
administration has also requested to zero out the section 999 program 
of the Energy Policy Act that is administered by the Research 
Partnership to Restore Energy for America (RPSEA), with oversight by 
FE-National Energy Technology Laboratory. This program funds 
unconventional natural gas research, a small producers program and 
ultra-deep water. This program addresses needed technology developments 
in safety and environmental protection. The EnComm strongly supports 
the continuation of this important program,

                ADVANCED RESEARCH PROJECTS AGENCY-ENERGY

    The EnComm supports the $550 million budget request for ARPA-E. 
ARPA-E represents a significant opportunity for the United States to 
cultivate technological breakthroughs related to energy sources and 
uses. A steady commitment to Advanced Research Projects Agency-Energy 
(ARPA-E) will encourage energy technology innovation and the committee 
believes that this is a worthwhile endeavor for the DOE as we seek to 
accomplish technological breakthroughs in energy technology.

                             NUCLEAR ENERGY

    The EnComm is discouraged to see a slight reduction of $5 million 
in the fiscal year 2012 DOE Nuclear Energy budget request to $857 
million more than the fiscal year 2010 appropriated amount. Although, 
this represents a minor budget reduction, particularly during sensitive 
budget negotiations, the EnComm is disappointed to see that no funding 
was requested for the creation of the Regaining our ENERGY Science and 
Engineering Edge (RE-ENERGYSE) program, which was requested for $5 
million in fiscal year 2011. The Congress has not supported this 
program since it was first proposed in the fiscal year 2010 request and 
repackaged in the fiscal year 2011 proposal. Still, educating the next 
generation of nuclear engineers will be critical to the fulfillment of 
both the administration's Clean Energy Standard as well as national 
security. The EnComm is hopeful that the DOE will work to identify new 
opportunities for nuclear engineering scholarship.
    Similarly, the Energy Committee is concerned about the plan by the 
administration for a discontinuation of the Generation IV Nuclear 
Energy Systems program. The Energy Committee is curious to see how the 
proposed Reactor Concepts research, development, and deployment program 
distinguishes itself from the traditional R&D program under the Office 
of Nuclear Energy. Nuclear energy, as a low-carbon, nongreenhouse gas-
emitting resource, is a critical component of a diverse U.S. power 
generation mix and should play a larger role in the Nation's base power 
supply. Given the President's proposed national ``clean-energy 
standard'' of 80 percent by 2035 the EnComm believes very strongly that 
sustained increases in nuclear power research are justified.

                 ENERGY EFFICIENCY AND RENEWABLE ENERGY

    EERE manages America's investments in research, development, and 
deployment of DOE's diverse energy efficiency and renewable energy 
applied science portfolio. The fiscal year 2012 request of $3.2 
billion, $943 million more than the fiscal year 2010 appropriated 
amount of $2.21 billion, and provides a broad and balanced set of 
approaches to address the urgent energy and environmental challenges 
currently facing our Nation. Most of the key EERE programs, including 
Biomass, Solar, Wind, Geothermal, Building Technologies, Vehicle 
Technologies, and Industrial technologies, would receive substantial 
increases in funding to support the growth of renewable energy. The 
EnComm is particularly pleased to see large increases for both the 
Industrial Technologies Program (ITP), as well as the Building 
Technologies Program. ITP conducts energy assessments for energy-
intensive factories to identify low-cost methods to improve their 
efficiency. The EnComm encourages the Congress to include waste-to-
energy as an important component of the country's Renewable Energy 
portfolio to provide it with the same benefits as energy from biomass.
    The EnComm believes that the development of transportation fuel 
systems that are not petroleum-based is a critical part of our future 
national energy policy. The fiscal year 2012 budget for biomass and 
bio-refinery systems R&D is slated to receive a $124 million increase 
to $340 million for fiscal year 2012, 57 percent more than the fiscal 
year 2010 appropriated amount. The Energy Committee supports the 
current appropriation and encourages the Congress to ensure that these 
research programs continue to receive adequate funding. We are also 
pleased to see the $273 million increase in the effort related to 
vehicle technologies emphasizing plug-in hybrid electric vehicles.
    The integration of all cost-effective electric generating 
technologies into the operation of the electricity distribution system 
is critical to economic operation of the national electric grid. The 
EnComm believes that R&D related to the integration of the electric 
grid and its control as a truly national system is imperative for the 
growth of effective and economic energy generation technologies and we 
encourage full funding for such research.

             SCIENCE AND ADVANCED ENERGY RESEARCH PROGRAMS

    The EnComm is pleased by the request for the Office of Science (OS) 
which restores the funding trajectory mandated in the America COMPETES 
Act of 2007 (Public Law 109-69). The fiscal year 2012 budget proposal 
of $5.4 billion is an increase of $452 million from the fiscal year 
2010 appropriation. OS programs in high-energy physics, fusion energy 
sciences, biological and environmental research, basic energy sciences, 
and advanced scientific computing, serve, in some small way, every 
student in the country. These funds support not only research at the 
DOE laboratories, but also the work at a large number of universities 
and colleges. We believe that basic energy research will also improve 
U.S. energy security over the long term, through its support for R&D on 
cellulosic ethanol and other next-generation biofuels, advanced battery 
and energy storage systems, and fusion. The only program slated for a 
decrease in OS is Fusion Energy Sciences. The EnComm has some concerns 
about the recent delays for the International Thermonuclear 
Experimental Reactor (ITER) experiment being conducted in Cadarache, 
France. The EnComm would like to see ITER built by 2018, but in 
recognition that this is now unlikely; the EnComm will reserve further 
judgment until more information becomes available. The Energy Committee 
strongly supports the budget request for the Office of Science, as well 
as the proposed doubling track for the office by fiscal year 2017.
    The Office of Science, in collaboration with ARPA-E, has announced 
the ``Sunshot Initiative'' to scale down the cost of solar energy by 
roughly 75 percent to $1 per watt of electric power, or about 6 cents 
per kilowatt hour of electricity. The program would cost $425 million 
to begin according to the administration's fiscal year 2012 budget 
request. The EnComm believes that this type of collaboration represents 
a good opportunity to leverage the technical resources available to 
both ARPA-E and the Office of Science. The EnComm would like to see the 
DOE make a strong effort to demonstrate the distinction between this 
project and similar types of research efforts, like the Energy Frontier 
Research Centers, and the Innovation Hubs to avoid redundancy.

                  OTHER DEPARTMENT OF ENERGY PROGRAMS

    DOE is also very active in areas outside of R&D. The environmental 
remediation program that funds the decommissioning and decontamination 
of old DOE facilities is one such research area. The EnComm questions 
the advisability of flat funding for the Environmental Management 
program. The Yucca Mountain Waste Repository is a critical part of the 
environmental cleanup activity. Termination of this project, in the 
short term, will only extend and increase the final cost of the 
environmental management program. The EnComm does not support this 
backward step. The coming resurgence in the commercial nuclear arena is 
likely to deplete the trained professionals available for this program 
as engineers choose to move to the more stable commercial environment. 
The Congress should appropriate the funds to ensure that this work is 
accomplished in an expeditious manner.

                               CONCLUSION

    Members of the EnComm consider the issues related to energy to be 
one of the most important issues facing our Nation. The need for a 
strong and coherent energy policy is apparent. We applaud the 
administration and the Congress for their understanding of the 
important role that scientific and engineering breakthroughs will play 
in meeting our energy challenges. In order to promote such innovation, 
strong support for energy research will be necessary across a broad 
range of technology options. DOE research can play a critical role in 
allowing the United States to use our current resources more 
effectively and to create more advanced energy technologies.
    Thank you for the opportunity to offer testimony regarding both the 
R&D and other parts of the proposed budget for the DOE. The EnComm is 
pleased to respond to requests for additional information or 
perspectives on other aspects of our Nation's energy programs.
                                 ______
                                 
         Prepared Statement of the Energy Efficiency Coalition

    We the undersigned represent a broad-based coalition of energy 
efficiency and environmental organizations, public interest 
organizations, and small and large businesses. We write today to ask 
your support for key energy efficiency programs within the Department 
of Energy (DOE). These programs provide the foundation for the clean-
energy investments that will ensure the long-term sustainability of the 
clean-energy economy.
    Energy efficiency is our cheapest, fastest, and cleanest-energy 
resource and a necessary solution to address energy prices, energy 
security, air pollution, and global warming. Energy efficiency already 
is the equivalent of any of the Nation's other energy resources: since 
1973, we save more energy each year from efficiency measures than we 
get from any single energy source, including oil. The following fiscal 
year 2012 funding recommendations build on past successes and provide 
additional support for provisions funded as part of American Recovery 
and Reinvestment Act.
    In the months ahead it will be necessary for you to make difficult 
choices regarding budget priorities for the fiscal year 2012 budget. We 
believe that investments in programs that reduce costs for both 
individuals and businesses, and create greater economic prosperity and 
energy security for our Nation, should be maintained and in some 
instances enlarged. Energy efficiency programs are a source of savings 
that in turn are spent in other sectors of the economy, and it does not 
make sense to cut these programs, especially with our energy security 
imperiled by the turbulence in Libya and the Middle East.
    Now is not the time to cut energy-efficiency programs and 
initiatives which help to protect Americans from volatile energy 
prices. Rather, we must increase investment in energy efficiency 
programs in order to meet our country's energy needs and safeguard our 
energy future.
    We support the President's budget request for fiscal year 2012 for 
the Department of Energy's (DOE) Office of Energy Efficiency and 
Renewable Energy (EERE) and specifically for the following EERE 
programs:
  --Building Technologies Program, including the Better Buildings 
        Initiative ($470 million);
  --Industrial Technologies Program ($319 million);
  --Weatherization Assistance ($320 million);
  --State Energy Program ($64 million); and
  --Federal Energy Management Program ($33 million).
    In addition to existing programs, it is important for America to 
maintain its competitive edge through continued research in new 
advanced energy efficiency technologies, such as the research 
undertaken by the DOE's ARPA-E program, for which the administration 
request is $550 million.
    The budget for the 2012 fiscal year presents both a challenge and 
an opportunity. By fully deploying the power of energy efficiency, we 
can help drive the economic recovery we all long for. Increased 
investment in critical energy efficiency programs will help those 
American families and businesses who are struggling today to lower 
their energy costs. It will improve our Nation's energy security in 
these uncertain times. We strongly urge your support for the programs 
identified in this letter, and welcome the opportunity to brief you or 
your staff on the benefits these energy efficiency programs provide to 
consumers and businesses in America.

                      ENERGY EFFICIENCY COALITION

    Alliance to Save Energy; American Council for an Energy-Efficient 
Economy; American Institute of Architects; American Public Power 
Association; Association of State Energy Research and Technology 
Transfer Institutions; Business Council for Sustainable Energy; Center 
for Environmental Innovation in Roofing; Citizens for Pennsylvania's 
Future (PennFuture); Copper Development Association; Danfoss; Direct 
Energy; Energy Future Coalition; Energy Platforms; Interfaith Power and 
Light; National Association for State Community Services Programs; 
National Association of Energy Service Companies; National Association 
of State Energy Officials; National Community Action Foundation; 
Natural Resources Defense Council; Polyisocyanurate Insulation 
Manufacturers Association; Rebuilding Together; Rinnai; Schneider 
Electric; Service Employees International Union; Sheet Metal and Air 
Conditioning Contractors National Association, Inc.; Sheet Metal 
Workers International Association; The Stella Group, Ltd.; U.S. Green 
Building Council; and United Technologies Corporation.
                                 ______
                                 
  Prepared Statement of the Executive Committee of the Fermi National 
               Accelerator Laboratory Users Organization

    We are the Executive Committee of the Users Organization of the 
Fermi National Accelerator Laboratory (Fermilab) located outside of 
Chicago, Illinois, and represent the 3000 user scientists of the 
premier U.S. laboratory for particle physics. Our membership includes 
researchers in high-energy physics (HEP) who study fundamental 
particles, astrophysics, and accelerators. Eight national laboratories 
are actively engaged in HEP research. These laboratories host 
facilities that are used by scientists from other national 
laboratories, from hundreds of U.S. universities, and from dozens of 
foreign institutions. Fermilab is the only one of the laboratories 
dedicated exclusively to the field.
    The Department of Energy (DOE) Office of Science and the National 
Science Foundation supports HEP research at U.S. national laboratories 
and universities. More than 160 U.S. institutions in 43 States host 
physicists, astrophysicists, engineers, and accelerator scientists who 
work in HEP. More than one-half of these institutions are funded 
through the DOE Office of Science.
    We urge the Senate to support sustained funding for fundamental 
science within DOE's Office of Science and the National Science 
Foundation. We request that the portfolio of funding for basic research 
be balanced. HEP research is a key part of these programs that yields 
valuable benefits to our Nation as described below. Our field is 
undergoing a transition with the Fermilab Tevatron accelerator program 
coming to a conclusion after an incredibly successful three decades. 
New programs are underway or just beginning that will provide the basis 
for vibrant, world-class research for the next several decades. This 
transition is a critical time for our field in the United States and 
requires sustained funding to maintain our leadership in HEP research.

                 VALUE OF HIGH-ENERGY PHYSICS RESEARCH

    In our modern economy, science and technology (S&T) are driving 
forces of national strength as detailed in the National Academies 
report ``Rising Above the Gathering Storm: Energizing and Employing 
America for a Brighter Economic Future'' and the 2010 update ``Rising 
Above the Gathering Storm Revisited''. Continued leadership in S&T 
fields is critical to our economic growth, national security, and world 
leadership. Innovation derived from a highly trained workforce is key.
    Without new technological developments within the United States, 
our economy will not grow and other countries will surpass us. But the 
most revolutionary technologies often require revolutions in our 
fundamental knowledge and understanding, or are invented in the 
research struggle of our most talented minds in pursuit of measuring, 
understanding, and testing new ideas and concepts. No one could have 
predicted the nature of our current society from the first studies of 
the electron; however we would not be communicating via email, fax, or 
text messages without them.
    HEP strives to understand the most fundamental aspects of nature. 
We can rarely predict the outcome, but the quest for knowledge has 
always led to numerous advances, some of which are listed below. 
Certain results are predictable: we will educate and train some of the 
best and brightest students who will contribute to our Nation in many 
different arenas.

                    VALUE OF TECHNOLOGY DEVELOPMENT

    While the primary purpose of HEP research is not the creation or 
development of new technology, our work often requires it to accomplish 
our goals. Many of our experiments require technology that does not 
exist when the project is started. Therefore, many of our researchers 
spend a significant part of their careers advancing high-tech particle 
detectors, developing complex computing algorithms, and pushing the 
limits of high-speed electronics. Without continuous innovation we 
would not be able to complete our experiments. But once these advances 
are made they are applied by industry.
    An example of this is the construction of the Fermilab Tevatron 
accelerator that reigned as the world's most powerful machine of its 
kind for nearly three decades. It required 1,000 superconducting 
magnets to be placed around a 4-mile ring. Creating superconducting 
magnets requires superconducting wire. At the start of the project in 
the 1970s, it was known how to make such wire, but the industry needed 
to make it did not exist. Fermilab researchers helped to build up that 
industry and advance their production techniques through a very 
successful joint government/business venture. Once the accelerator was 
complete in 1983, these businesses looked around to see what other 
projects could use superconducting wire. MRIs that are commonly used 
for medical imaging are an example. Because of the work of Fermilab, 
MRIs became much more widely available in the 1980s.
    A current experiment being led by Fermilab scientists is the Dark 
Energy Survey (DES). This experiment requires a digital camera larger 
than any ever built. Their technological developments will eventually 
influence the digital cameras available at your local electronics store 
as well as devices no one has even dreamed of yet.
    High-energy physicists have been the leaders in accelerator science 
since its beginning. Our work requires the most powerful particle 
accelerators that can be built. However, accelerators are now used in 
thousands of applications. More than 17,000 particle accelerators are 
used throughout the world, only a small fraction of these dedicated to 
HEP. Most are used by industry and for medical treatment. The tire 
industry, for example, now uses particle accelerators to treat their 
tires, which has resulted in a reduction of 3 pounds less rubber per 
tire and a reduction in the amount of chemicals needed in the 
production process. The industry is more efficient and better for our 
environment because of the application of particle accelerators. This 
success was unanticipated in the early days of accelerator development, 
but is certainly a positive result.

                           VALUE OF EDUCATION

    The United States has long been the destination of choice for the 
best science students from around the world. Our universities provide 
an education that is second to none. Our national laboratories provide 
research opportunities that are unavailable elsewhere. Fermilab is an 
excellent example of this. Numerous students from foreign institutions 
travel to Fermilab to complete their research. Many of these students 
then choose to stay in the United States after completing their 
degrees.
    Our students learn a variety of skills that are applicable in 
numerous fields. They learn how to work on problems where the answer is 
unknown and how to adapt to unforeseen challenges. They learn skills in 
computer programming, data analysis, simulation of complex problems, 
and electronics development, among others. They learn to work in teams 
and do collaborative projects. Most importantly, they learn how to take 
a project from start to finish, write a document detailing it, and 
present it to an audience. These skills are all highly desired by 
businesses.
    Many of our students choose to continue their immediate careers as 
postdoctoral associates. This provides a postgraduate education that 
further develops their skills. Postdocs generally take on more complex 
projects and develop leadership and management skills. Most HEP 
experiments involve 20 to 2,000 scientists and face challenges that are 
similar to those in many businesses.
    Scientists trained in HEP work in telecommunications, software 
development, aerospace, education, medicine, government, and finance, 
to name a few. Approximately one-fourth of our Ph.D. students enter new 
fields. Private businesses are the largest and most diverse employers 
of scientists trained in HEP. Several former HEP researchers have 
founded or led small and large companies, including Richard Wellner, 
chief scientist at Univa UD, a cloud management software company; 
Francisco Vaca, CEO of Vaca Capital Management LLC; George Coutrakon, 
director of operations at Loma Linda University Medical Center; and 
Homaira Akbair, CEO of SkyBitz, a satellite-based tracking company.
    Our researchers are engaged in all levels of education and 
understand the importance of scientific literacy in our society. We use 
numerous venues to advance this. Hundreds or thousands of public 
lectures are given around the country each year. Our scientists visit 
local schools to share the excitement of science through physics 
demonstrations or presentations of their work. The QuarkNet program, 
funded through the National Science Foundation, trains K-12 teachers in 
28 States in cutting-edge research so that they can take it back into 
the classroom. More than 38,000 students attend Fermilab education 
activities each year.

                         IMPACT OF BUDGET CUTS

    Continued funding of science research is critical to our Nation. 
Severe budgetary cuts will have devastating effects that will be felt 
for decades. Science opportunities will be delayed or lost to other 
nations. Our reputation as the place to be for the best and brightest 
will be damaged. The administration's request for fiscal year 2012 
maintains a funding level for science research that will allow us to 
avoid substantial damage.
    Large cuts will have immediate impacts on our universities and 
national laboratories. Layoffs and/or furloughs will be unavoidable if 
we return to fiscal year 2008 funding levels. Several Fermilab projects 
that were slated to start construction in fiscal year 2011 have already 
been delayed. These projects are key to the near-term future of the 
laboratory and the U.S. HEP program.
    However, the largest and longest-lasting impact will be in our 
training of the next generation of scientists. Severe cuts will force 
us to train fewer students. It will demoralize our current students and 
postdocs, and some will quit. And we will no longer attract the best 
students. It will take a long time to overcome even a short-term cut to 
funding. These young people will be the foundation on which our 
economic growth depends. Without the advanced training offered by 
fields such as HEP, they will lack the skills to develop the next 
technology or the next new industry. Or they will be trained in other 
countries and that innovation will occur overseas. It is critical that 
we remain attractive to U.S. and foreign students now and in the 
future.

                                SUMMARY

    Scientific research in general, and HEP in particular, provides 
value to our Nation that will be lost without continued funding from 
the U.S. Government. The knowledge that is gained will lead to future 
innovation that will continue our world leadership. The path to that 
knowledge will lead to advances in technology that will help sustain 
our economic recovery. And the education of students from the United 
States and abroad will provide the knowledgeable workforce that will 
carry us through the next half century.
    It is critically important to maintain our leadership position in 
scientific research. The repercussions of severe cuts will be felt for 
a long time. We urge the Senate Appropriations Committee to support the 
President's request to maintain our scientific research program for the 
long-term health of the Nation.
                                 ______
                                 
    Prepared Statement of the Federation of American Societies for 
                          Experimental Biology

    The Federation of American Societies for Experimental Biology 
(FASEB) respectfully requests an appropriation of $5.10 billion for the 
Department of Energy Office of Science (DOE SC) in fiscal year 2012. 
This figure is in keeping with President Obama's vision for strong 
national investment in innovation, and it would enable DOE SC to 
continue to support essential research programs that enhance human 
health and quality of life, invigorate the economy, bring the Nation 
closer to energy independence, and drive scientific advances.
    As a Federation of 23 scientific societies, FASEB represents more 
than 100,000 life scientists and engineers, making it the largest 
coalition of biomedical research associations in the United States. 
FASEB's mission is to advance health and welfare by promoting progress 
and education in biological and biomedical sciences, including the 
research funded by DOE SC, through service to its member societies and 
collaborative advocacy. FASEB enhances the ability of scientists and 
engineers to improve--through their research--the health, well-being, 
and productivity of all people.
    DOE SC provides more than 40 percent of the total funding for basic 
research in the physical sciences, including fundamental research in 
energy sciences, biological and environmental sciences, materials and 
chemical sciences, and computational science. In addition to supporting 
research at more than 300 colleges and universities, DOE SC funds and 
manages 10 world-class national laboratories.
    The DOE SC national laboratories, located in eight States across 
the country, maintain essential research and development facilities 
containing sophisticated instrumentation such as particle accelerators, 
advanced light sources, and supercomputers. Because large-scale 
facilities provide infrastructure beyond the budget of any individual 
research institution, tens of thousands of university and industry 
scientists rely heavily on access to unique DOE SC instrumentation in 
order to conduct cutting-edge research. For example, xray facilities 
housed at DOE SC national laboratories, such as the Advanced Photon 
Source at Argonne National Laboratory, are used by nearly all U.S.-
based pharmaceutical and biotechnology companies to conduct protein 
structure studies critical to the drug design process. Furthermore, the 
oil and gas industry uses DOE SC instrumentation to study the atomic 
structure of chemicals used to process and refine fossil fuels. Without 
strong and sustained support for DOE SC, operations at national 
laboratory facilities could be limited or terminated, forcing U.S. 
companies that depend on them to move their research studies to 
overseas locations providing better access to instrumentation.
    At academic institutions and national laboratories across the 
country, DOE SC-funded scientists have uncovered a wealth of knowledge 
that has led to life-changing developments in energy, medicine, 
computer science, and other fields. For example, a team of DOE SC-
funded scientists is studying a fungus capable of degrading plant 
material into the simple sugars necessary to make biofuels, possibly 
leading to a more economical means of manufacturing ethanol for 
industrial applications. DOE SC also partners with other Federal 
science agencies on projects requiring multidisciplinary resources and 
expertise. Along with the National Science Foundation and the National 
Eye Institute, DOE SC sponsored the research and development of an 
artificial retina to restore sight in patients blinded by eye diseases 
such as macular degeneration and retinitis pigmentosa. The study of 
artificial retina technology has advanced the general field of neural 
prostheses, which has the potential to improve the lives of people with 
spinal cord injuries, Parkinson's disease, deafness, and other 
neurological disorders.
    Now is not the time to abandon investment in the innovative 
research supported by DOE SC. Insufficient funding for the agency would 
curtail groundbreaking scientific discoveries by forcing essential 
research facilities to close, causing thousands of scientific jobs to 
be lost, and deterring the next generation of scientists and engineers. 
A source of abundant, safe, clean, and sustainable energy is critical 
to the Nation's future. Development of new energy sources that can be 
used in place of fossil fuels will create new industries, reduce U.S. 
dependency on foreign oil, protect the environment, provide economic 
opportunities, and strengthen national security. Furthermore, because 
of the collaborative work of science agencies and the increasingly 
interdisciplinary nature of scientific research, support for the 
Federal research and development portfolio has never been more 
important. With its vital mission and unique research facilities, 
investment in DOE SC programs should be one of our highest national 
priorities.
    Thank you for the opportunity to offer FASEB's support for DOE SC.
                                 ______
                                 
  Prepared Statement of the Fuel Cell and Hydrogen Energy Association

    On behalf of the members of the Fuel Cell and Hydrogen Energy 
Association, we are writing to urge your continued support for fuel 
cell and hydrogen energy programs for fiscal year 2012 Energy and Water 
Development appropriations. These critical programs create green jobs, 
increase the efficient use of our Nation's natural resources, reduce 
dependence on foreign oil and enhance energy security, while reducing 
criteria air pollutants and greenhouse gas emissions.
    As the subcommittee develops the fiscal year 2012 Energy and Water 
Development appropriations bill, we urge you to support the fuel cell 
and hydrogen programs at the fiscal year 2010 levels of $174 million 
managed by the Energy Efficiency and Renewable Energy (EERE) and $50 
million in Fossil Energy (FE) organizations at the Department of Energy 
(DOE). This amount would fully fund the critical research, development, 
demonstration and deployment of these technologies in order to gain a 
stronger foothold in current markets and move the others to 
commercialization in the near-term.
    Fuel cell and hydrogen technologies produce jobs and are a crucial 
part of the portfolio of advanced energy technologies that will help 
achieve the Nation's oil and greenhouse gas (GHG) reduction goals. Fuel 
cells for stationary power and material handling equipment are 
commercially available and creating jobs today in domestic and export-
oriented manufacturing. The United States is poised to introduce fuel 
cell electric vehicles by 2015, as long as there is continued support 
for technology maturation, supplier development and infrastructure 
deployment. Advanced R&D in FE and EERE, market transformation, 
technology validation, and hydrogen efficiencies in EERE are key 
components of the fuel cell budget.
    The United States currently leads the world in fuel cell and 
hydrogen technologies. Japan, Germany, Korea, and China have made it a 
national priority to develop these technologies and attract the skills 
and intellectual property to create a domestic clean-energy business as 
a platform for a future export market. In the United States, fuel cell 
commercialization is underway, and businesses are making the necessary 
investments to bring fuel cell-powered products to American customers.
    President Obama has set strong targets for the Nation for clean-
energy generation and manufacturing; and for increasing the number of 
vehicles fueled by biofuels, natural gas, and powered by electric drive 
trains. Fuel cells and hydrogen energy can help America meet those 
goals faster, more efficiently, and with less impact on the 
environment. Fuel cells are always the cleanest way to use any fuel, 
whether renewable or fossil, and all fuel cell electric vehicles are 
hybrids, as they use batteries to store energy; moreover, there is no 
cleaner way to use natural gas as a transportation fuel than to reform 
it for use in a fuel cell electric vehicle.
    What the industry needs now is help from DOE in leveraging these 
private dollars to help mature current markets and aid in creating a 
competitive landscape for budding ones. Realizing the budget 
constraints you are working under, a budget consistent with fiscal year 
2010 levels will send a strong, positive signal to other investors, 
companies investing in fuel cell products, auto makers, supply chain 
partners, and potential customers. We need a robust market for fuel 
cells and hydrogen energy in the United States if we want to keep these 
industry jobs and the resulting economic growth here, as well.
    Thank you for your consideration of our request.

           STRENGTHEN FEDERAL HYDROGEN AND FUEL CELL PROGRAMS

    Proposal.--Fund DOE fuel cell programs at a Congress-approved level 
for fiscal year 2010; restore reductions proposed by the administration 
for fiscal year 2012.
    DOE's Office of Fuel Cell Technologies, Fuel Cell and 
Infrastructure Technologies Program supports the development of fuel 
cells, hydrogen fuel and supporting infrastructure for power 
generation, backup power, industrial vehicles, portable applications, 
and passenger cars. The program has made exceptional progress in a few 
short years, helping to reduce the cost of fuel cells by 45 percent 
since 2007 and the cost of hydrogen produced from renewable sources and 
natural gas by 40 percent. The program has tested and evaluated 160 
fuel cell vehicles in real-world operation, led the development of 
safety codes and product standards, and helped deploy more than 1,000 
fuel cell systems to Federal agencies and early private sector 
customers where they are improving energy efficiency and security of 
supply with low or zero emissions.
    The United States is the recognized world leader in fuel cell 
technology. DOE research has supported more than 200 patents. But the 
full benefits of commercialization, including, by DOE's estimate, up to 
677,000 jobs in the next 25 years, will go where the Government 
policies and public-private partnerships are strongest. Germany, South 
Korea, Japan, and China, among others, are implementing long-term 
programs designed to capture the fuel cell lead and reap the economic 
and energy security benefits that will follow. The Obama 
administration's proposal to reduce fuel cell funding would send just 
the opposite signal to our domestic market, and have long-term 
undesirable consequences.
    Fuel cell technologies are a crucial part of the new energy network 
that is needed to achieve the Nation's energy policy and greenhouse gas 
reduction goals. DOE estimates fuel cells can reduce oil imports by 
nearly 8 billion barrels over the next 40 years, reduce CO2 
emissions by 2.4 billion tons, and save consumers $1.6 trillion. A 
robust public-private partnership focused on cost reduction and early 
deployment will accelerate commercialization and the benefits that 
accrue with marketplace success.
Office of Energy Efficiency and Renewable Energy Programs--$174 Million
      Vehicles and Infrastructure.--Support for deployment and fueling 
        infrastructure, backed by testing and evaluation, is essential 
        to accelerating the transition to the marketplace. As its Phase 
        I Technology Validation program winds down, DOE should evolve 
        to support early volumes of commercial Fuel Cell Electric 
        Vehicles and related infrastructure.
      Market Transformation.--The Market Transformation Program 
        provides technical and financial support for purchase or lease 
        of fuel cell systems entering the marketplace. The program 
        creates U.S. jobs, improves security of air travel and 
        communications, and enables a commercial transition in early 
        markets by driving down costs through economies of scale. DOE 
        should continue Market Transformation activities in all market 
        sectors.
      Enabling Activities.--These programs prepare local communities 
        for fuel cell installations, fueling stations and vehicles, and 
        help DOE evaluate program options. Systems analysis, safety, 
        codes and standards, education, and manufacturing technology 
        programs all contribute to commercialization.
      Research and Development.--DOE's robust program of cost reduction 
        via research into materials, catalysts, and components should 
        continue. Hydrogen is one of a portfolio of fuels that together 
        will achieve U.S. energy security while meeting greenhouse gas 
        reduction goals. Improved hydrogen storage will reduce vehicle 
        cost and improve capability, and will enable efficient use of 
        hydrogen as a storage strategy for intermittent renewable 
        resources, such as wind and solar power. Hydrogen from biomass 
        uses a renewable domestic energy source and provides greater 
        greenhouse gas reductions than biofuel combustion.
Office of Fossil Energy: Solid State Conversion Alliance Program--$50 
        Million
    Solid State Energy Conversion Alliance (SECA) is a cost-shared 
public-private partnership developing high-temperature solid oxide fuel 
cells (SOFCs) for stationary power generation that has met or exceeded 
every benchmark set for it by the Congress and the DOE in its more than 
10 years of existence. Industry has spent $3 for every $1 of Government 
funds, and decreased the cost of SOFCs tenfold, while increasing their 
efficiency and durability by 2 to 3 times. Continued support is needed 
to scale-up the technology to central power station levels. The United 
States lead in SOFCs, and has created commercially viable distributed 
power generation using natural gas, biogas, and landfill gas that emits 
zero criteria pollutants at a low-GHG intensity. Continued development 
and commercialization of SECA technology will deliver a significant 
return to the U.S. economy. Walking away now would hand the fruits of 
our investments to our foreign competitors.
                                 ______
                                 
           Prepared Statement of the Gas Technology Institute

    Gas Technology Institute (GTI) welcomes the opportunity to provide 
comments to the Appropriations Subcommittee on Energy and Water 
Development.
    GTI is an independent not-for-profit organization serving research, 
development, and training needs of the natural gas industry, gas 
consumers, and energy markets. Most of the 250-person GTI staff is 
based at GTI's headquarters located on an 18-acre campus in Des 
Plaines, Illinois. More than 70 percent of our personnel are 
technically trained engineers and scientists. GTI has more than 280,000 
square feet of office, laboratory, shop, library, and training space 
with more than 110,000 square feet devoted to laboratory, fabrication 
and testing facilities. GTI currently manages approximately $60 million 
in research and development contracts per year (more than 100 
projects), and has been managing contracts of this type since the 
1940s. GTI performs contract Research and Development (R&D) for the 
Department of Energy (DOE) and is very familiar with many of its 
programs.

                              NATURAL GAS

    New opportunities for the production of natural gas in the United 
States will provide a jobs and economic boom to many parts of our 
Nation over the next 10 years. In the last year alone Pennsylvania has 
created 44,000 new jobs and their residents have received more than 
$389 million in lease payments from private companies for the right to 
explore natural gas trapped in shale formations. By 2020, 211,000 new 
jobs are expected to be created in Pennsylvania and lease payments more 
than $1.9 billion \1\ to be paid.
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    \1\ http://marcelluscoalition.org/wp-content/uploads/2010/05/PA-
Marcellus-Updated-Economic-Impacts-5.24.10.3.pdf.
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    To assist in accomplishing the goals of energy independence, 
reducing emissions and creating hundreds of thousands of new jobs, the 
Congress and executive branch should provide similar attention and 
resources to the development and deployment of natural gas technologies 
as are provided to other energy sources. Today, the DOE spends billions 
of R&D dollars on wind, solar, coal, and more-efficient electric 
technologies. These are all important efforts, however, when reviewing 
the agency's entire R&D budget, less than 1 percent is spent on natural 
gas R&D even though natural gas represents 25 percent of our Nation's 
primary energy use and that is expected to grow over the next several 
decades and natural gas provides compelling public benefits in terms of 
domestic economic growth, improved energy security, source energy 
efficiency, and reduced carbon dioxide emissions.

        DEPARTMENT OF ENERGY'S RESEARCH AND DEVELOPMENT FUNDING

    For R&D related to natural gas, a review of the combined budgets of 
Energy Efficiency and Renewable Energy (EERE) and Fossil programs 
alone, show that in 2010, the U.S. Government provided an estimated $80 
million (3.5 percent), out of an almost $2.3 billion total. It is clear 
that if the United States wants to support an expanded role for clean-
burning natural gas, leading to improved energy independence, energy 
efficiency, job creation and reduced emissions, scarce R&D dollars 
should be, in part, focused on natural gas. These new natural gas 
technologies could be utilized in all energy sectors including homes, 
businesses, manufacturing, power generation, and transportation; as 
well as to enhance reliability and safety of the natural gas production 
and delivery system.
Natural Gas Research and Development Funding Information and 
        Observations (Increase Funding for Natural Gas Research and 
        Development)
    The $100 million Industrial Technology Program (ITP) continues to 
be the only program at DOE that focuses a portion of their budget on 
developing new more efficient technologies for manufacturing. Many of 
these technologies will be powered by natural gas.
    Approximately 60 percent of the $673 million 2010 fossil energy 
budget for R&D was appropriated for coal while only 2.5 percent was 
directed to natural gas.
    During 2010, Coal accounted for 22 percent of the country's primary 
energy use while natural gas represented 25 percent of the county's 
primary energy use. It would be fair and prudent to spend comparable 
R&D funding for natural gas.\2\
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    \2\ http://www.eia.gov/oiaf/aeo/tablebrowser/
#release=AEO2011&subject=0-AEO2011&table=2-AEO2011&region=1-
0&cases=ref2011-d120810c.
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    The American Recovery and Reinvestment Act spending stimulus 
provided $3.4 billion to the Fossil Energy Program. All was spent on 
coal.
    The approximately $200 million buildings program at EERE has no 
specific program to support natural gas technologies for homes and 
businesses even though approximately 70,000,000 U.S. homes and 
businesses use natural gas.\3\
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    \3\ A.G.A. ``Gas Facts: with 2008 Data'', Tables 8-2 and 8-3.
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    Currently natural gas vehicle (NGV) R&D at USDOE is $5 million. 
Electric vehicle R&D is approximately $128 million.
    The Office of Electricity and Energy Reliability only funds R&D 
programs for the Electric Grid, not the entire energy delivery system, 
thus discounting the importance of our Nation's gas pipeline 
infrastructure which currently supplies 21 percent of U.S. electricity.
    No money within the Renewable program is directed toward the 
development of technologies to produce renewable natural gas (RNG) from 
livestock manure, landfills, wastewater treatment, or woody-bio-mass 
even though RNG may offer the most efficient means to deliver nonwind 
or solar renewables to energy consumers.
    The current proposed DOE budget by the administration provides no 
funding or R&D program direction for natural gas vehicles, efficiency 
improvements for natural gas power generation or home appliances, 
efficiency for natural gas commercial cooking, natural gas carbon 
capture, renewable natural gas technology, or development of hybrid 
solar natural gas technologies.
    Following are recommendations that begin to address the lack of 
natural gas R&D at DOE. Within some of the recommendations are 
suggested resource amounts. GTI suggests these amounts as part of 
whatever allocated dollars are agreed upon between the Congress and the 
administration. We are not suggesting new money--just a reasonable and 
prudent refocus supporting an equitable approach for natural gas R&D.
    Residential homes and commercial buildings consume more than 40 
quadrillion Btus (or Quads) of energy. Developing building technologies 
that utilize the least amount of total energy; provide similar 
performance as existing technologies and take advantage of renewable 
opportunities can ensure the most efficient use of important domestic 
energy resources such as natural gas.
    Natural gas is an important domestic energy resource, with nearly 
all of U.S. demand for natural gas coming from North America and 52 
percent of all U.S. homes utilizing natural gas for space/hot water 
heating or cooking. While an expanding supply from new sources such as 
gas shales has resulted in a flattening of prices--a trend that is 
expected to continue, this domestic source of energy should be used in 
the most efficient and clean manner ensuring the maximum benefit of 
existing and future supply.

                           BUILDINGS PROGRAM

    The natural gas industry, manufacturers, and R&D performers will 
identify and capture financial support for this effort with 20 to 40 
percent co-funding expected, depending on the type of R&D performed.
    We recommend natural gas efficiency R&D within the DOE's Buildings 
Technology Program of $12 million. This is a very small request 
relative to their overall 2010 budget which was more than $200 million, 
and this request is supported by the American Gas Association (AGA) and 
numerous gas utilities and other gas related trade associations.
    Specific program initiatives include:
      Space Conditioning and Water Heating Efficiency and Operational 
        Improvements.--$2.9 million.
      Building Systems and Community Energy System Technologies.--$2.6 
        million.
      Breakthrough Technology Development.--$2.1 million.
      Development of Higher-Efficiency Commercial Food Service 
        Equipment.--$1.6 million.
      Solar/Natural Gas Hybrid Systems.--$2.8 million.

                     INDUSTRIAL TECHNOLOGY PROGRAM

    Within ITP, we are concerned of the new focus proposed in the 
President's fiscal year 2012 budget proposal. This new focus of R&D 
support for manufacturing of advanced materials discounts the 20 years 
of stakeholder involvement by the steel, glass, aluminum, heat-treating 
food processing, and other energy intensive industries that have worked 
with the Industrial Technology Program to develop new processes and 
other means to reduce energy consumption and improve manufacturing 
technologies. Many of these stakeholders have already voiced their 
concerns to Members of Congress and DOE.
    GTI suggests that a good guide for ensuring that the ITP addresses 
the R&D needs of energy-intensive manufacturing industries can be found 
in section 452 of the ``Energy Independence and Security Act of 2007''. 
We are not suggesting the specific funding outlined in that section, 
but rather the language regarding the scope and focus of the ITP 
presented in section 452 titled ``Energy Intensive Industries 
Program.''
    We also recommend specifically that ITP include a focus on waste 
heat recovery, and combined heat and power.
  --Gas Heat Pump Technology (CHP);
  --Micro Combined Heat and Power Production Development (CHP); and
  --CHP Efficiency and Carbon Reduction Improvements (CHP).

                          VEHICLE TECHNOLOGIES

    As mentioned earlier the President's budget request for DOE in 2012 
provided no funding for natural gas vehicle R&D even though the request 
for the overall budget for the vehicle programs was $588 million. GTI 
proposes a budget of $30 million for natural gas vehicle R&D. This 
request is supported by AGA, numerous gas utilities, and NGV America.
    Specific program initiatives include:
  --Development of new engines to meet a wider range of applications.
  --Integrating natural gas engines into additional medium- and heavy-
        duty vehicle platforms such as buses, trash trucks, delivery 
        trucks, and over-the-road trucks as well as marine and off-road 
        applications.
  --Develop new natural gas hybrid-electric platforms.
  --Reduce cost and weight of compressed and liquefied natural gas 
        storage systems.
    Renewables.--Ensure that some portion of the Renewables program 
area can support the demonstration of a renewable natural gas 
production facility utilizing gasification to produce pipeline quality 
gas from woody-biomass. (Excellent efficiency--low emissions).
    Fossil.--Currently there is no funding for natural gas and the 
President's USDOE Fossil Energy R&D budget request of $453 million is 
directed for coal carbon capture and sequestration. Program direction 
would be welcome for improving efficiency of natural gas power 
generation, natural gas exploration and production R&D to address 
environmental concerns, and natural gas power generation carbon 
capture.
    Office of Electricity and Energy Reliability.--All funding is 
focused on the electric grid. The President's proposed budget of $238 
million should provide program direction, at a minimum, to address the 
synergies of our Nation's pipeline infrastructure in relationship to 
electric grid reliability.

   SECTION 999/THE RESEARCH PARTNERSHIP TO SECURE ENERGY FOR AMERICA

    In 2005, as part of the Energy Policy Act, (section 999) funding 
was directed from the Nation's Oil and Gas Royalty Trust Fund to create 
a program that would focus on unconventional natural gas exploration 
and production R&D and on deepwater fossil fuel extraction R&D. The 
program was designed to provide $12.5 million to the National Energy 
Technology Laboratory (NETL) and $37.5 million to a nonprofit whose 
sole purpose was to manage and guide an energy R&D program as described 
above. This total of $50 million annually is directed spending.
    The Research Partnership to Secure Energy for America was 
eventually chosen by DOE to manage the $37.5 million R&D program. 
Today, RPSEA continues to manage $37.5 million of the program and 
provides a resource plan to DOE annually for the execution of the 
funding.
    RPSEA disseminates RFP's once USDOE approves its annual plan and a 
majority of the funding supports work performed by universities and 
nonprofits like GTI. The most recent annual plan delivered by RPSEA 
centers on performing environmentally focused R&D for shale gas and 
deepwater fossil fuel exploration. RPSEA stands ready to assist the 
Nation in better understanding and addressing the environmental issues 
related to shale gas and deepwater fossil fuel exploration and 
production.
    The Congress should continue support for section 999, (which funds 
RPSEA) at current or increased levels.
  --RPSEA continues to be a model of Private/Public R&D partnerships 
        focused on delivering new technology and analysis.
  --RPSEA is developing environmental and process solutions for shale 
        gas and deepwater fossil energy exploration.
  --Natural gas R&D funding in the 1980s and 1990s supported by the 
        natural gas industry and the Federal Government helped to make 
        possible the current and growing production of natural gas from 
        shale formations, and contributed to the technological 
        breakthroughs that reversed a 40-year decline in domestic oil 
        production.\4\ \5\
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    \4\ http://www.whitehouse.gov/sites/default/files/microsites/ostp/
pcast-energy-tech-report.pdf.
    \5\ http://mjperry.blogspot.com/2010/12/us-oil-and-gas-reserves-
increased.html and http://www.eia.doe.gov/emeu/mer/pdf/pages/
sec3_3.pdf.
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  --RPSEA, while having considerably less financial resources than the 
        R&D programs of the 1980s and 1990s, can help continue the 
        development of breakthrough technologies and processes to 
        improve and enhance natural gas exploration and production.
                                 ______
                                 
           Prepared Statement of the Gas Turbine Association

    The Gas Turbine Association (GTA) appreciates the opportunity to 
provide the Subcommittee on Energy and Water Development of the United 
States Senate Appropriations Committee with our industry's statement 
recommending fiscal year 2012 funding levels for the Department of 
Energy (DOE).
    While the GTA recognizes the need to reduce Federal spending in 
today's fiscal environment, we respectfully recommend that the fiscal 
year 2012 appropriation for fossil energy include $20 million for the 
Advanced Turbines Program research and development (R&D) to meet 
critical national goals of fuel conservation, greenhouse gas reduction, 
fuel flexibility (including syngas and hydrogen), and criteria 
pollutant reduction. A spending level of $20 million is more 
appropriate than the administration's recommendation $14.6 million 
considering the fiscal year 2010 spending level was $32 million. A 
spending level of $20 million would still represent a significant cut 
of 37 percent and will result in pushing out the timeline for the 
development and deployment of environmentally advanced gas turbines by 
several years.
    It is clear that dramatic reductions in greenhouse gas emissions 
are in the national interest. It is also clear that our economy needs 
more electric generation capacity to resume and promote further growth. 
Without new technology, the power generation industry will be hard 
pressed to produce additional electric capacity, while at the same time 
meeting the strict greenhouse gas emissions standards being set by 
States and the Federal Government.
    Federal investment in research and technology development for 
advanced gas turbines that are more efficient, versatile, cleaner, and 
have the ability to burn hydrogen-bearing reduced carbon synthetic 
fuels and carbon-neutral alternative fuels is needed to ensure the 
reliable supply of electricity in the next several decades. Domestic 
coal based Integrated Gasification Combined Cycle (IGCC) with carbon 
capture and storage is one such approach that would significantly 
supplement available supplies of domestic natural gas to guarantee an 
adequate supply of clean and affordable electric power. Alternative 
fuel choices range from imported liquefied natural gas (LNG), coal bed 
methane, and coal-derived synthetic or process gas to biogas, waste-
derived gases and hydrogen. Research is needed to improve the 
efficiency, reduce capital and operating costs, and reduce emissions.

   TECHNOLOGIES FOR ADVANCED INTEGRATED GASIFICATION COMBINED CYCLE /
  H2 GAS TURBINE--REDUCING THE PENALTY FOR CO2 
                                CAPTURE

    At current rates of research and development it is unlikely that 
the Nation will have available the gas turbine technologies to meet the 
needs of carbon capture capable powerplants. The advancement of these 
technologies must be undertaken by the DOE since there is currently no 
pathway to the development, insertion, and maturation of these 
technologies into the Nation's electric power infrastructure based on 
market forces. Thus, a combined effort by the public and private 
sectors is necessary.
    The turbines and related technologies being developed under the DOE 
Fossil Energy Advanced Turbines program will directly advance the 
performance and capabilities of future power generation with 
CO2 capture and storage. Advances are needed to offset part 
of the powerplant efficiency and output reductions associated with 
CO2 capture. Program funding is required to cost-share in 
the technology development of advanced natural gas/hydrogen/syngas 
combustors and other components to realize the DOE goals.
    Several GTA member companies are working cost-share programs with 
the DOE to develop technologies for advanced gas turbine powerplants 
with carbon capture. These technologies will:
  --increase plant efficiency;
  --increase plant capacities; and
  --allow further reductions in combustion emissions of hydrogen rich 
        fuels associated with CO2 capture and storage.
    This will help offset some of the efficiency and output penalties 
associated with CO2 capture. These programs are funding 
technology advancement at a much more rapid rate than industry can do 
on their own.
    The need for Federal cost-share funding is immediate. The funding 
levels in past years for the advanced turbines program has been 
inadequate to meet DOE's Advanced Power System goal of an IGCC power 
system with high efficiency (45-50 percent HHV), near-zero emissions 
and competitive capital cost. To meet this goal, the researchers must 
demonstrate a 2 to 3 percentage point improvement in combined cycle 
efficiency above current state-of-the-art Combined Cycle turbines in 
IGCC applications.
    The plan for the IGCC-based powerplants is to develop the 
flexibility in this same machine with modifications to operate on pure 
hydrogen as the primary energy source while maintaining the same levels 
of performance in terms efficiency and emissions. The goal is to 
develop the fundamental technologies needed for advanced hydrogen 
turbines and to integrate this technology with CO2 
separation, capture, and storage into a near-zero emission 
configuration that can provide electricity with less than a 10-percent 
increase in cost over conventional plants by 2012.
    The Advanced Turbines program is also developing oxygen-fired (oxy-
fuel) turbines and combustors that are expected to achieve efficiencies 
in the 44-46 percent range, with near-100 percent CO2 
capture and near-zero NOX emissions. The development and 
integrated testing of a new combustor, turbine components, advanced 
cooling technology, and materials in oxy-fuel combustors and turbines 
is needed to make these systems commercially viable.
    The knowledge and confidence that generating equipment will operate 
reliably and efficiently on varying fuels is essential for the 
deployment of new technology. Years of continued under-funding of the 
Advanced Turbines program has already delayed the completion dates for 
turbine R&D necessary for advanced IGCC.

            MEGA-WATT SCALE TURBINE RESEARCH AND DEVELOPMENT

    In the 2005 Enabling Turbine Technologies for High-Hydrogen Fuels 
solicitation, the Office of Fossil Energy included a topic area 
entitled ``Development of Highly Efficient Zero Emission Hydrogen 
Combustion Technology for Mega-Watt Scale Turbines''. Turbine 
manufacturers and combustion system developers responded favorably to 
this topic, but DOE funding constraints did not allow any contract 
awards. The turbine industry recommends a follow-up to this 
solicitation topic that would allow the developed combustion technology 
to be tested in machines at full-scale conditions and allow for 
additional combustion technology and combustor development for both 
natural gas and high-hydrogen fuels.
    The turbine industry believes that this technology is highly 
relevant to industrial coal gasification applications including:
  --site-hardened black-start capability for integrated gasification 
        combined cycle applications (the ability to restart an IGCC 
        powerplant when the electric grid has collapsed);
  --supplying plant electric load fueled on syngas or hydrogen;
  --increasing plant steam cycle capacity on hot days when large 
        amounts of additional power are needed; and
  --in gas turbines for compression of high-hydrogen fuels for pipeline 
        transportation.
    The development of MW-scale turbines (1-100 MW) fueled with either 
natural gas or high-hydrogen fuels will promote the sustainable use of 
coal. In addition, highly efficient aeroderivative megawatt-scale 
engines operate under different conditions than their larger 
counterparts and are installed for peaking or distributed generation 
applications. Funding is required to design efficient and low emissions 
combustors that accommodate the new fuels.

              GAS TURBINES REDUCE GREENHOUSE GAS EMISSIONS

    The gas turbine industry's R&D partnership with the Federal 
Government has steadily increased powerplant efficiency to the point 
where natural gas fired turbines can reach combined cycle efficiencies 
of 60 percent, and quick-start simple cycle peaking units can reach 46 
percent. The gas turbine's clean exhaust can be used to create hot 
water, steam, or even chilled water. In such combined heat and power 
applications, overall system efficiency levels can reach 60 to 85 
percent LHV. This compares to 40-45 percent for even the most advanced 
thermal steam cycles (most of which are coal fired).
    Gas turbines already play a very significant role in minimizing 
greenhouse gas emissions worldwide. Gas turbines are both more 
efficient and typically burn lower-carbon fuels compared to other types 
of combustion-based power generation and mechanical drive applications. 
The Nation needs to reinvigorate the gas turbine/government partnership 
in order to develop new, low-carbon powerplant solutions. This can be 
done by funding research to make gas turbines both efficient and more 
capable of utilizing hydrogen and synthetic fuels as well as increasing 
the efficiency, durability and emissions capability of natural gas 
fired turbines. If the Congress provides adequate funding to DOE's 
turbine R&D efforts, technology development and deployment will be 
accelerated to a pace that will allow the United States to achieve its 
emissions and energy security goals.




    GTA respectfully requests $20 million in fiscal year 2012 
appropriations for the Fossil Energy Advanced Turbines Program to meet 
critical national goals of fuel conservation, fuel flexibility 
(including natural gas, syngas, and hydrogen), greenhouse gas 
reduction, and criteria pollutant reduction.
    Gas Turbine Association Member Companies.--Alstom Power; GE Energy; 
Florida Turbine Technologies; Rolls-Royce; Siemens Energy; Solar 
Turbines; Pratt & Whitney Power Systems; Strategic Power Systems; and 
VibroMeter.
                                 ______
                                 
                    Prepared Statement of GE Energy

                                OVERVIEW

    The following testimony is submitted on behalf of GE Energy (GE) 
for the consideration of the subcommittee during its deliberations 
regarding the fiscal year 2012 budget requests for the Department of 
Energy (DOE). GE recognizes that particularly difficult choices must be 
made in fiscal year 2012. These budget pressures make it essential that 
the subcommittee prioritize those programs that will contribute to 
economic growth and jobs creation and support core technology 
development. GE recommends:
  --in the coal budget, increased investment in integrated gasification 
        combined cycle technology development;
  --funding at the levels requested by the administration for solar and 
        wind technologies; and
  --support for Smart Grid Research and Development.

                             FOSSIL ENERGY

    Coal Program, Advanced Energy Systems, Gasification Systems.--The 
proposed fiscal year 2012 budget would reduce gasification research and 
development (R&D) by 32 percent from the fiscal year 2010 funding 
level. This trend confirms a fundamental shift in DOE's focus to 
advanced combustion/postcombustion carbon capture--ostensibly due to 
potential application to new and existing plants. GE believes that this 
is a flawed strategy that compromises the future of coal. It ignores 
the superior environmental performance of Integrated Gasification 
Combined Cycle (IGCC) with respect to water usage, criteria pollutant 
emissions, hazardous air pollutants and useful coal byproducts. It also 
ignores the proven ability of IGCC with full-scale, commercially 
proven, pre-combustion carbon capture to provide the lowest avoided 
cost of CO2 compared to other technologies.
    It remains the case, however, that the base cost of IGCC must be 
reduced further to provide a low-carbon option for coal that does not 
depend on incentives. Today the higher initial capital cost of IGCC 
combined with the current low cost of natural gas places IGCC at a 
disadvantage. DOE studies have shown that IGCC with carbon capture and 
sequestration (CCS) can achieve a cost of electricity equal to current 
new coal generation without CCS, but not without further technology 
improvements. The fiscal year 2012 budget is insufficient to develop 
these improvements.
    DOE should prioritize technology programs having dual benefits in 
terms of reducing base plant cost that will also reduce the avoided 
cost of CO2 as compared to conventional coal with carbon 
capture. GE recommends that the fiscal year 2012 budget for IGCC 
restore the fiscal year 2010 funding level of $63 million to support 
programs having nearer term and dual benefits:
  --design for constructability and cost/technology tradeoff modeling 
        ($8 million);
  --design methodologies and technologies for availability and 
        reliability ($7 million); and
  --operational flexibility for tomorrow's grid ($5 million) (to 
        support the higher penetration of renewable generation).
    Clean Coal Power Initiative.--The Clean Coal Power Initiative 
(CCPI) is an outlet for validation at commercial scale and prototype 
application of technology from the coal R&D programs. The 
oversubscription of the CCPI-3 solicitation demonstrated industry's 
interest in undertaking coal projects. However, the continuing 
uncertainty of carbon policy makes private investment in demonstrations 
that explicitly require carbon capture and sequestration--which reduces 
plant output, reduces efficiency, increases fuel consumption and 
exposes the project developer to potential legal risk--difficult to 
justify.
    Taking these concerns into consideration, GE recommends that DOE 
move forward with the development of a CCPI-4 solicitation no later 
2015. The solicitation should not exclusively require CCS, but should 
include EOR and other beneficial uses of CO2, and should 
allow for technologies that have dual benefits as described above. A 
phased program should be employed for projects that incorporate CCS, to 
begin with funding of front-end engineering designs (FEEDs) and site 
characterization before proceeding further. This will enable a utility 
to provide accurate cost data to its regulators and demonstrate that it 
has a sequestration resource with sufficient capacity for the life of 
its plant.
    Advanced Energy Systems, Hydrogen Turbines.--The proposed fiscal 
year 2012 budget will reduce funding for the Hydrogen Turbine program 
by 53 percent from fiscal year 2010. The program has been successful in 
meeting technical goals and working toward offsetting much of the 
performance penalty associated with coal-fueled IGCC carbon capture 
while also achieving very low NOX emissions. However, 
funding limitations have delayed the program from meeting its original 
2015 goals until 2016-2017, and the fiscal year 2012 budget reduction 
will extend the delay out until 2020. This presents a high risk of 
technology not being ready for the next CCPI demonstration opportunity. 
GE recommends funding of $45 million in fiscal year 2012 to help 
recover schedule so that advanced hydrogen turbine technology is ready 
for the next CCPI opportunity.
    Water Management.--Large amounts of water are needed to produce or 
extract energy, and large amounts of energy are needed to treat or 
transport water. EPA has recently released a proposed Cooling Water 
Intake Rule that underscores the important linkage between water use 
and energy generation. What is more, CO2 capture increases 
raw water usage by up to 125 percent, depending on the underlying 
technology. In order to achieve DOE's aggressive goals of reducing 
freshwater withdrawals and consumption 50 percent by 2015 and 70 
percent by 2020, water-related R&D funding is needed. Despite this 
need, yet again this year, DOE has requested no new funding for the 
Water Management subprogram, and also has stated that all projects 
involving Water Management are to be suspended.
    GE believes that funding should be provided for R&D for innovative 
water reuse technologies and demonstration projects including:
  --cooling tower blowdown reuse;
  --Flue Gas Desulphurization wastewater reuse and recovery;
  --ash pond solids reduction; and
  --treatment and reuse of produced water from unconventional oil and 
        natural gas production to further reduce environmental impacts 
        and operational costs of upstream energy processes.
    Support also is needed to advance reuse/treatment technologies for 
the conversion of impaired wastewater streams into sources of renewable 
water in areas of water scarcity, reducing the need to use energy to 
transport water over long distances and to support electricity 
generation.

                            RENEWABLE ENERGY

    Solar.--GE urges the Congress to fully fund the DOE's fiscal year 
2012 budget request for Solar Energy. This request for $457 million 
represents a necessary commitment to accelerate the development and 
deployment of solar, particularly Photovoltaics (PV). GE is investing 
significantly in solar PV technology with a focus on cost reduction. 
Public funding for technology innovation and R&D is critical to 
improving solar's cost competitiveness with traditional power-
generation technologies and to achieving the ambitious goal of a 
dollar-a-watt installed price for solar electricity before the end of 
the decade. In addition, funding for Systems Integration will provide 
more solutions for higher penetration of PV on the grid. By enhancing 
the affordability and reliability of solar, these investments in R&D 
and grid integration can advance the adoption of this technology by 
utilities and other consumers.
    Wind.--GE also urges the Congress to fully fund the DOE's fiscal 
year 2012 budget request for Wind Energy of $127 million. This funding 
will support the continued evolution and scaling of this technology. GE 
is the leading wind turbine supplier in the United States and has 
invested more than $1 billion in wind technology development since 
2002. Further progress in improving the cost, performance, and 
reliability of wind technology is critical. In particular, we believe 
the program's increased focus on advanced drivetrains, control systems, 
and components represent important investments in areas where public 
R&D plays a critical role in accelerating technology development and 
deployment. In addition, continued support for the DOE's new offshore 
wind R&D and demonstration program will be essential to the development 
of a domestic offshore wind market and manufacturing base.

                               SMART GRID

    Electricity Delivery and Energy Reliability.--GE supports the 
fiscal year 2012 budget request for Smart Grid Research and 
Development. R&D on Smart Grid technologies will advance reliable, 
affordable, efficient, and secure delivery of electric power to 
industrial, commercial, and residential customers, while at the same 
time transitioning the grid to support new forms of renewable energy. 
Integration of traditional grid electric infrastructures with modern IT 
computer and communications systems will be necessary, and GE is 
working closely with national and international standards development 
organizations in the development of Smart Grid interoperability 
standards. Cybersecurity is a fundamental design principle of this 
effort.
    R&D is required to develop advanced grid analytics software to 
optimize grid efficiency and reliability, including ``Big Data'' 
storage and real time analysis and exascale computing. Funding through 
ARPA-E and its Wireless Innovation Fund also will be critical to the 
development of cutting edge wireless technologies needed for the 
acquisition of data for grid analytic programs.
    In order to reduce risk and accelerate the adoption of new advanced 
Smart Grid technologies R&D funding will be required for the 
development of Smart Grid modeling, simulation, and visualization of 
both the transmission and distribution networks. Advanced modeling 
capabilities will serve as a critical tool in the modernization of the 
electric grid by assisting grid operators in identifying the technical 
limits of conventional grid technologies, and facilitating development 
of new technologies and solutions to respond to a changing energy mix 
and an increasingly responsive consumer base. In addition, advanced 
modeling capabilities can enable grid operators and power systems 
planners to aggregate, analyze, and act upon the vast quantities of 
data collected by Smart Grid technologies, thereby unlocking the full 
potential of the Smart Grid. DOE should expand industry participation 
in this program to fully leverage work already underway.
    Smart Grid Renewables and EV Research and Development.--The Smart 
Grid can fundamentally change the way electricity is generated, 
transmitted, and consumed, thereby delivering substantial improvements 
in the efficiency and reliability of our Nation's electric grid. 
Additional research is needed in areas such as the integration of plug-
in hybrid electric vehicles and advanced management of distribution 
voltage.
    GE recommends that in order to achieve higher levels of renewables 
penetration, R&D funding should be set aside for power electronics 
development. GE recommends that the Congress provide support for DOE to 
conduct research into applications of power electronics to support 
Smart Grid technologies.
    Energy Storage.--GE endorses the requested funding for further 
research into energy storage technologies. The fiscal year 2012 budget 
request appropriately broadens the scope of interest to include 
innovations in new battery chemistries. This could lead to radical 
improvements in energy storage performance. Electricity storage is a 
critical technology to enable both deployment of electric vehicles and 
improvements in grid stability and efficiency through utility-scale 
storage.
    GE recommends that equal attention should be given to both electric 
vehicles and storage. The requirements of utility-scale storage are 
quite different from those of electric vehicles. GE recommends 
inclusion of research into large-scale energy storage into this line 
item. This includes all potential storage modalities such as compressed 
air, pumped hydro, and flywheel technologies.

                        COMBINED HEAT AND POWER

    Industrial Technologies Program.--GE supports the request for $25 
million in funding for the Combined Heat and Power (CHP) Generation 
line item of the Industrial Technologies Program. This funding has 
enabled demonstration of a reciprocating natural gas engine operating 
at 47-percent efficiency, up from a baseline of 37 percent while 
preserving the exhaust heat for combined heat and power applications. 
When used in CHP applications the total efficiency can reach 90 
percent, making this by far the highest-efficiency and lowest-emission 
solution for distributed electricity generation. Gas engines also have 
rapid start and efficient load following capability making this a key 
technology to ensure continued stable electric grid operation with 
increasing addition of variable resources such as wind. Continued 
funding will enable completion of the final phase of demonstrating 50-
percent efficiency.
                                 ______
                                 
              Prepared Statement of GSI Environmental Inc.

    As an environmental consulting firm with more than 25 years 
experience in the oil and gas industry, we strongly encourage the U.S. 
Senate Appropriations Committee to continue to fund the important work 
of Department of Energy (DOE) Oil and Gas Research and Development 
Program for development of new and improved technologies for 
environmental management in the U.S. domestic oil and gas sector.
    Need for Improved Environmental Management Technology.--With the 
current expansion of the shale gas industry into new geographic regions 
of the United States and the over-riding goal of achieving U.S. energy 
independence, the coming years will see ever-increasing exploration, 
drilling, and production activity throughout the country. As this rapid 
expansion is underway, the general public and media are already 
demanding improved measures for protection of natural resources and 
public health.
    Key Role of DOE.--The DOE Oil and Gas Research and Development 
Program is the only Federal program currently dedicated to addressing 
these environmental concerns. The DOE, through the Research Partnership 
to Secure Energy for America (RPSEA), works with the scientific 
community and the oil and gas industry to develop new technologies for 
efficient resource development and environmental protection. This 
information is then shared with both large and small producers to 
improve environmental management practices nationwide.
    Benefits of DOE Environmental Research and Development Program.--
The attached table identifies 10 examples of projects supported by the 
DOE RPSEA program which are providing practical, tangible benefits in 
terms of improved environmental management in the domestic oil and gas 
sector today, including:
  --Environmentally Friendly Drilling Practices to reduce the footprint 
        of drilling operations and enhance environmental protection 
        measures;
  --Treatment of Highly Saline Produced Water to allow reuse and 
        recycling, rather than discharge, of valuable water resources, 
        as well as recovery of a marketable salt product;
  --Protection of Sensitive Eco-Systems in Major Shale Gas Plays in 
        Colorado and Utah, in order to reduce potential environmental 
        impacts and costs of shale gas development;
  --Innovative Methods for Management of Produced Water including 
        generation of electrical energy via waste heat recovery; 
        reduction of saltwater production from mature oilfields by use 
        of particle gel treatments; and improved management methods to 
        reduce water demand and enhance water reuse for hydrofracturing 
        operations;
  --New Road Building Techniques to reduce environmental impacts to 
        sensitive desert terrains and ecosystems of the Western United 
        States during transport of oil and gas production fluids.
    Cost-Effective Research and Development.--The RPSEA program 
provides a unique opportunity to leverage government funding with 
private sector resources. In all grants awarded by RPSEA, the recipient 
is required to secure sponsorship of industry partners and to provide 
matching resources for a significant percentage of the project budget. 
This policy not only ensures that the research work will be directly 
applicable to active oil and gas operations but leverages a relatively 
small investment by DOE to achieve significantly greater economic 
benefit.
    The DOE Oil and Gas Research and Development Program is the only 
supporter of these and other environmental management initiatives. At a 
time of increasing dependence upon domestic oil and gas resources and 
an unprecedented expansion of shale gas drilling activities throughout 
our country, the practical environmental solutions developed by RPSEA 
are critical for the continued protection of our environment and the 
continued leadership of the U.S. oil industry in the arena of 
environmental stewardship.
    We strongly encourage the U.S. Senate Appropriations Committee to 
preserve and expand the funding of the DOE Oil and Gas Research and 
Development Program and RPSEA so that they may continue the important 
work for energy independence and environmental protection.

  TABLE 1.--EXAMPLES OF RESEARCH AND DEVELOPMENT PROJECTS SUPPORTED BY
           RESEARCH PARTNERSHIP TO RESTORE ENERGY FOR AMERICA
------------------------------------------------------------------------
               Project title                     Summary information
------------------------------------------------------------------------
 
                   2009
 
Improvement of fracturing in gas  shales..  Use nondamaging fracturing
                                             fluids and light weight
                                             proppants combined with
                                             foams to maximize fracture
                                             length, minimize formation
                                             damage, minimize use of
                                             water in fracturing and
                                             minimize disposal of fluids
                                             for gas shale reservoirs.
Electrical power generation from produced   Identify and demonstrate
 water--Field demonstration of ways to       technology that will reduce
 reduce operating costs of small producers.  the field operating cost of
                                             electricity and minimize
                                             environmental impacts by
                                             creating green electricity
                                             using produced water and no
                                             additional fossil fuel.
 
                   2008
 
The environmentally friendly drilling       Combine new low-impact
 systems program.                            technologies that reduce
                                             the footprint of drilling
                                             activities, integrate light
                                             weight drilling rigs with
                                             reduced emission engine
                                             packages, address on-site
                                             waste management, optimize
                                             the systems to fit the
                                             needs of a specific
                                             development sites, and
                                             provide stewardship of the
                                             environment.
Pretreatment and water management for       Evaluate the applicability
 fracturing water reuse and salt             of three pretreatment
 production.                                 processes to pretreat high-
                                             total dissolved solids,
                                             high-hardness fracturing
                                             water, such as is found in
                                             the Marcellus shale, for
                                             thermal recovery of water
                                             and a marketable salt
                                             product for both stationary
                                             and mobile pretreatment
                                             facilities.
Barnett and Appalachian shale water         Develop water management
 management and reuse technologies.          methods and technologies
                                             that reduce demands for
                                             freshwater, reduce
                                             environmental impact of
                                             brine disposal, and ensure
                                             supplies of water for well
                                             drilling and completion for
                                             natural gas development in
                                             the Barnett and Appalachian
                                             Shale Plays.
 
                   2007
 
Cost-effective treatment of produced water  Test a low-temperature
 using co-produced energy sources for        distillation unit for
 small producers.                            produced water purification
                                             at the wellhead, yielding
                                             water clean enough for
                                             beneficial uses like
                                             drilling, stimulating, or
                                             waterflooding.
Field site testing of low impact oil field  Reduce the environmental
 access roads--Reducing the footprint in     impact of mature field O&G
 desert ecosystems.                          operations and reduce the
                                             costs and regulatory delays
                                             associated with additional
                                             resource development.
                                             Identify and test new
                                             techniques to reduce the
                                             environmental impact of oil
                                             field lease roads in desert-
                                             like ecosystems.
Mitigating water production and extending   Establish methods to
 the life of mature oil wells and further    optimize particle gel
 improve particle gel technology.            treatments to increase oil
                                             recovery plus reduce water
                                             production, by improving
                                             waterflood sweep
                                             efficiency. Anticipated
                                             result will be reduction in
                                             the water production rate
                                             to decrease associated
                                             environmental risks and
                                             impact of any spills.
Paleozoic shale gas resources of the        Objectives of this study are
 Colorado plateau and eastern great basin,   to identify and map the
 Utah: Multiple frontier exploration         major trends for target
 opportunities.                              shale intervals and
                                             identify areas with the
                                             greatest gas potential;
                                             characterize the geologic,
                                             geochemical, and
                                             petrophysical rock
                                             properties of those
                                             reservoirs; reduce
                                             exploration costs and
                                             drilling risk especially in
                                             environmentally sensitive
                                             areas; and recommend the
                                             best practices to complete
                                             and stimulate these
                                             frontier gas shales.
An integrated framework for treatment and   Develop an Integrated
 management of produced water.               Decision Framework to
                                             manage and treat produced
                                             water that has the
                                             potential to substantially
                                             reduce the overall costs
                                             and enhance gas recovery
                                             and economic viability (and
                                             longevity) of CBM and gas
                                             shale fields while
                                             minimizing potential
                                             environmental impacts.
------------------------------------------------------------------------

                                 ______
                                 
  Prepared Statement of the National Association for State Community 
                           Services Programs

    As Chair of the Board of Directors for the National Association for 
State Community Services Programs (NASCSP), I am pleased to submit 
testimony in support of the Department of Energy's (DOE) Weatherization 
Assistance Program (WAP) and in support of DOE's State Energy Programs 
(SEP). In these difficult budgetary times, we understand that tough 
decisions have to be made. However, WAP and SEP are proven, cost-
effective, measurably successful, and vital to the Nation's energy 
security and energy-efficiency movements, delivering savings to low-
income Americans, businesses, and industry. In order to sustain the 
infrastructure and training and technical assistance expertise and 
activities begun with the funding provided by the American Recovery and 
Reinvestment Act of 2009 (ARRA), we seek a fiscal year 2012 
appropriations level of $320 million for the WAP and $125 million for 
SEP. These funding levels are essential to continue and improve these 
outstanding programs for our citizens. Due to the close of ARRA funding 
in March 2012, normally appropriated funds are even more critical to 
allow the WAP network to fulfill its administrative duties and ensure 
continued quality and success at the expanded ARRA level.
    Some examples of the Program's accomplishments include:
  --Creation and continued support of more than 15,000 full-time, 
        highly skilled jobs within the service delivery just in ARRA 
        funds, with 8,000-10,000 additional jobs from annual grant 
        funding, and many more in related businesses, such as materials 
        suppliers;
  --Weatherization of an additional 650,000 homes occupied by low-
        income families due to ARRA and approximately 28,000 homes 
        through annual appropriations, thereby reducing energy use and 
        associated energy bills;
  --Served more than 6.7 million low-income homes since the program's 
        inception, with an additional 38.3 million eligible;
  --Saves an estimated 35 percent of consumption for the typical home, 
        with savings continuing year-after-year and actual $1 savings 
        increasing as fuel prices increase;
  --Saves $437 in first-year energy savings for households weatherized;
  --Returns $2.51 for every $1 spent in energy and nonenergy benefits 
        over the life of the weatherized home;
  --Serves as a foundation for residential energy-efficiency retrofit 
        standards, technical skills, and workforce training for the 
        emerging broader market;
  --Supports communities through local purchasing and jobs created 
        nationwide;
  --Reduces residential and powerplant emissions of carbon dioxide by 
        2.65 metric tons/year per home;
  --Decreases national energy consumption by the equivalent of 24.1 
        million barrels of oil annually.
    WAP is the largest residential energy conservation program in the 
Nation and serves an essential function by helping low-income families 
reduce their energy use. The program was developed in the late-1970s as 
a response to rapidly rising energy costs associated with oil shortages 
created by oil embargoes. The Congress acknowledged that low-income 
families were particularly vulnerable to increased energy price 
fluctuations and created the program to assist those families by 
reducing the cost to heat their homes. WAP was institutionalized within 
the DOE in 1979 and today operates in all 50 States, the District of 
Columbia, five U.S. territories, and two Native American tribes. 
Approximately 1,000 local agencies provide services in every political 
jurisdiction of the country using direct hire crews and local 
contractors to do the work. These network providers use program funds 
to improve the energy efficiency of low-income dwellings, utilizing the 
most advanced technologies and testing protocols available in the 
housing industry. Since the Program's inception, more than 6.7 million 
homes have been weatherized using Federal, State, utility, and other 
monies.
    WAP is still as relevant now as it was when it was formed in 
response to the energy crisis 30 years ago. The savings to America's 
most vulnerable citizens are significant and make a huge, immediate 
difference in their lives. These families have an average energy 
burden--the percentage of their income needed to pay residential energy 
bills--around 15 percent of their income as compared to around 3-
percent for nonlow income households, or five times greater. And the 
poorest families have a much higher energy burden than that. For 
example, in the State of California, subcommittee Chairman Dianne 
Feinstein's home State, there are more than 718,000 households below 50 
percent of the Federal poverty level. Those families have an energy 
burden of 36.5 percent--more than one-third of their income. With lower 
energy bills, these families can increase their usable income and buy 
other essentials like food, shelter, clothing, medicine, and 
healthcare. WAP provides a positive return on investment to meet its 
primary objectives of making homes warmer in winter and cooler in 
summer and creating safer and healthier indoor environments.
    Because of the advanced diagnostics and technology developed in 
WAP, the program is the foundation for the emerging green energy-
efficiency retrofit workforce. There are approximately 25,000 jobs in 
the WAP network, with many more supported in related businesses, such 
as material suppliers. These jobs are good, living wage jobs, which are 
more important than ever due to the economic downturn in the housing 
and construction industries. Workers are highly trained and receive on-
going instruction to further develop their skills. WAP is at the core 
of the larger energy-efficiency retrofit market, and its training 
curricula, methods, and centers play an integral role in developing 
tools and techniques and a workforce. WAP managers, trainers, and 
technical experts figure prominently in the Recovery through Retrofit 
Initiative, contributing their expertise to the Workforce Guidelines 
for Residential Energy Efficiency Workers and playing a key role in the 
development of standardized training curricula, worker certifications, 
and training facility accreditations.
    American Recovery and Reinvestment Act provided $5 billion over 3 
years for the WAP. This investment has allowed States and local 
agencies to increase significantly their efforts to weatherize 650,000 
homes. WAP has created more than 15,000 new jobs across the country 
since 2009, making it the 8th highest ARRA job creating program. This 
figure does not include the countless jobs and businesses supported 
with WAP money in the foundering housing industry during this period. 
Furthermore, the network has weatherized more than 380,000 homes 
through February 2011, and will reach its production goals before the 
conclusion of ARRA grants.
    While the ARRA invested significantly in energy efficiency and 
independence, in order to sustain the program beyond March 2012 it is 
critical that the WAP maintain adequate funding so the network can 
continue to provide jobs and support local economies as well as promote 
energy efficiency nationwide.
    NASCSP urges the subcommittee to fund WAP at $320 million while 
providing $125 million for SEP. The WAP remains a crucial component of 
our Nation's energy future. WAP is a clearly proven investment, has 
provided significant energy savings, and has helped more than 6.7 
million families live in safer, more comfortable living conditions. 
This is a program that has proved its worth and effectiveness for more 
than 30 years. NASCSP looks forward to working with subcommittee 
members in the future as we attempt to create energy self-sufficiency 
and good jobs for millions of American families through these 
invaluable national programs.
                                 ______
                                 
    Prepared Statement of the National Association of State Energy 
                               Officials

    Mr. Chairman and members of the subcommittee, I am Phil Giudice of 
Massachusetts and chair of the National Association of State Energy 
Officials (NASEO). NASEO is submitting this testimony in support of 
funding for a variety of Department of Energy (DOE) programs. 
Specifically, we are testifying in support of no less than $125 million 
for the State Energy Program (SEP), which is equal to the 
authorization. SEP is the most successful program supported by the 
Congress and DOE in this area. This should be base program funding, 
which allows States to set their own energy priorities while 
contributing to national energy goals, with no competitive portion 
which focuses primarily on DOE's internal priorities. SEP is focused on 
direct energy project development, where most of the resources are 
expended. SEP has set a standard for State-Federal cooperation and 
matching funds to achieve critical Federal and State energy goals. As 
American Recovery and Reinvestment Act (ARRA) winds down over the 
remainder of this year, the base SEP funds are the critical linchpin to 
help States in building on these activities and expanding energy-
related economic development, much as SEP has done for 30 years. We 
also support the $320 million fiscal year 2012 budget request for the 
Weatherization Assistance Program (WAP). These programs are successful 
and have a strong record of delivering savings to low-income Americans, 
homeowners, businesses, and industry. We also support the budget 
request for the Energy Information Administration (EIA) of $124 
million. EIA's State-by-State data is very helpful. EIA funding is a 
critical piece of energy emergency preparedness and response, and there 
are significant new EIA responsibilities under EISA. NASEO continues to 
support funding for a variety of critical buildings programs, including 
Building Codes Training and Assistance, ENERGY STAR, the commercial 
buildings initiative/Better Buildings and residential energy efficiency 
at least at the fiscal year 2010 level. NASEO also supports funding for 
the Office of Electricity Delivery and Energy Reliability (OE), at 
least at the fiscal year 2010 funding level. Specific funding should be 
provided for the Division of Infrastructure Security and Energy 
Restoration of no less than $18 million, which funds critical energy 
assurance activities. We also strongly support the R&D function and 
Operations and Analysis function within OE. The industries program 
should be funded at least at the fiscal year 2010 level.
    Formula SEP funding provides a basis for States to share best 
practices among themselves. These best practices (even without stimulus 
funds) allow States to get a great deal accomplished. These types of 
activities include energy financing programs, revolving loans, utility-
based programs, energy service performance contracts, etc.
    In January 2003 (and updated in 2005), Oak Ridge National 
Laboratory (ORNL) completed a study and concluded, ``The impressive 
savings and emissions reductions numbers, ratios of savings to funding, 
and payback periods . . . indicate that the State Energy Program is 
operating effectively and is having a substantial positive impact on 
the Nation's energy situation.'' ORNL found that $1 in SEP funding 
yields:
  --$7.22 in annual energy cost savings;
  --$10.71 in leveraged funding from the States and private sector in 
        18 types of project areas;
  --annual energy savings of 47,593,409 million source BTUs; and
  --annual cost savings of $333,623,619.
    Energy price volatility makes the program more essential as 
businesses and States work together to maintain our competitive edge.

                    STIMULUS FUNDING IMPLEMENTATION

    We want to thank the subcommittee for the tremendous support 
provided in the stimulus package for a variety of State and local 
funding initiatives, including $3.1 billion for SEP, $5 billion for 
WAP, $3.2 billion for the Energy Efficiency and Conservation Block 
Grant and $300 million for the ENERGY STAR appliance rebate program. 
This is a major task. We have been working closely with DOE to 
implement these programs as quickly as possible. We have had regular 
calls with all the State energy officials to address implementation 
questions. We have also had a series of regional conference calls among 
the States, and we have seven regional coordinators helping to share 
``best practices'' among the States. NASEO is sharing best practices 
and providing information to officials at all levels of government in 
order to more effectively coordinate this effort. We are convinced that 
these funds are helping to engineer major positive changes in the U.S. 
economy that will improve all sectors of the economy. NASEO believes it 
is important to maintain base levels of appropriations for critical 
programs, such as SEP and WAP, in order to avoid a huge decrease in 
funding after a rapid stimulus increase.
    With respect to ARRA spending for SEP, of the $3.1 billion 
appropriated, virtually all the money is now under contract and work is 
being implemented. We and DOE are working through the barriers that 
slowed spending, including National Environmental Policy Act 
compliance, Davis-Bacon wage rates, Buy-American clauses, historic 
preservation, lead paint requirements and general procurement issues. 
It is important to stress that the key figures are the ``commitment'' 
and ``contracted'' amounts, because that is when people get hired and 
work commences. States generally do not pay until projects are actually 
completed and milestones are met. We do not pay-up front in most cases. 
In economics jargon, the Federal spending figure is actually a lagging 
indicator. Of the ARRA funds dedicated to SEP and Energy Efficiency and 
Conservation Block Grant, more than $1 billion has been dedicated to 
energy financing programs in cooperation with the private sector. This 
has the greatest long-term potential.
    Examples of Successful State Energy Program Activities.--The States 
have implemented thousands of projects. We have previously supplied to 
subcommittee staff examples of programs implemented under ARRA. Here 
are a few representative examples.
    Alabama.--The State has dedicated $25 million for an energy 
revolving loan fund for business and industry, and has dedicated 
millions for energy efficient school retrofit grants. The Walker County 
school project alone is saving $146,000 per year in energy costs with a 
$300,000 SEP investment.
    Alaska.--SEP-supported projects include the Village End-Use 
Efficiency Measures project, which assisted 31 remote villages. In the 
last year, more than 400 projects are now being implemented in order to 
reduce the terribly high-energy costs in these villages (they have 
historically paid, at a minimum, more than six times the national 
average for electricity costs).
    California.--The State is implementing a comprehensive residential 
and commercial ($18.8 million) building retrofit program, an energy 
finance program for municipalities, and State building retrofits 
through revolving loans (more than $25 million), clean-energy business 
financing, low-interest loans for local governments and ``Green Jobs'' 
workforce training ($20 million). Jobs associated with the residential/
commercial program total 1,200. The Energy Technology Assistance 
Program is creating more than 700 jobs.
    Hawaii.--This State is focused on energy efficiency and renewable 
energy projects intending to supplement existing efforts. For example, 
promotion of ENERGY STAR upgrades for hotels, technical assistance to 
develop green buildings and other energy efficient buildings, have been 
two major projects. Funds have supplemented the public benefits 
program, the county energy efficiency efforts and alternative fuel 
efforts. Electric vehicle development, including infrastructure 
expansion, has also been a focus.
    Illinois.--The SEP-supported Green Industry Business Development 
Program is supporting renewable energy and energy efficiency component 
manufacturers and manufacturers of recycled content products. One of 
the State's many school projects installed a geothermal heating and 
cooling system in four, Rantoul schools, which resulted in 145 local 
jobs and important training.
    Iowa.--This State has committed substantial funding to municipal 
energy-efficiency projects and green jobs initiatives. A good example 
has been Sun Prairie Vista Court Apartments where more than $110,000 is 
being saved annually and the owner contributed $1.7 million. They have 
also instituted an energy loan program. Funding has supplemented 
programs and projects conducted under the State-funded Iowa Power Fund. 
The energy office has also been very involved in preserving propane 
supplies to respond to emergencies.
    Kentucky.--$14 million has been dedicated to the Green Bank of 
Kentucky for energy efficiency financing for public buildings by 
utilizing revolving loans. In addition, funds were provided for an 
advanced energy efficient battery initiative, commercial office 
building energy efficiency retrofits, industrial facility energy 
efficiency retrofits, Home Performance with ENERGY STAR, utility smart 
grid activities, and $10 million for energy efficiency in K-12 schools. 
The school districts are targeting more than $14 million in savings for 
the program. The partnership with the University of Kentucky is also 
providing funds for ``circuit riders'' to work across the State on 
energy projects.
    Louisiana.--$25.7 million has been committed to energy efficiency 
retrofits in higher education buildings; $15.7 million is dedicated to 
retrofits of commercial buildings and energy efficiency for new and 
existing homes; and $10 million has been committed to renewable energy 
development. Their Home Energy Rebate Option (HERO) program provided 
energy-efficiency rebates of more than $1 million in 3 months for more 
than 400 homeowners. The commercial rebates are as high as $5,000 per 
facility.
    Maine.--The State's SEP-supported project fund helped match funding 
for Tex Tech (sports equipment manufacturer) in North Monmouth, that 
allowed the purchase of new biomass equipment saving $400,000 in fuel 
costs and retaining 40 local jobs. The State's new home energy 
efficiency retrofit program has now begun and is implementing 
residential retrofits.
    Mississippi.--$17 million was dedicated for energy efficient public 
buildings, including retrofits, performance contracting, and building 
energy codes; $10 million was allocated for renewable energy projects, 
smart meters on public facilities and support for community college 
workforce training. An additional $10 million was slated for businesses 
to implement energy efficiency or renewable energy upgrades. The 
Mississippi Job Protection through Energy Economic Development Program 
has provided grants to 55 companies for energy retrofits, with annual 
savings of almost $4 million. One example is the Laurel Machine and 
Foundry Company, where they are savings almost $100,000/year, and the 
company said that without these funds they would have closed and 32 
employees would have lost their jobs.
    Montana.--$22.3 million has been allocated to State universities, 
community colleges and other State facilities for energy efficiency 
projects; 89 projects are underway. The Montana Veterans Nursing Home 
in Columbia Falls has been the beneficiary of one of these projects, 
allowing the State to be repaid in only 3 months for the energy-
efficiency upgrade, including cost share. Additional funds have been 
dedicated to renewable energy demonstration projects, including CORE 
Wind Power for a 3 MW facility in Ronan, Algae Aqua Culture 
Technologies for biomass projects, the biodiesel blend project in the 
Hi-Line area and a Chester-based oilseed processor project.
    New Jersey.--$7 million has been committed to fund solar 
installations on multi-family buildings; $4 million for residential 
energy efficiency financing; $4 million for multi-family energy 
efficiency loans; $17 million for municipal energy efficiency 
incentives; $6 million for State building energy efficiency; and an 
additional $15 million for grants and loans for energy efficiency and 
renewable energy applications. Recently, 430 home energy retrofits were 
completed under their Home Performance with ENERGY STAR program.
    Rhode Island.--Funds have been provided for a green building 
initiative in State facilities, a commercial/industrial energy 
efficiency initiative, building code upgrades and energy efficient 
transportation:
  --$8.4 million has been allocated for renewable energy loans;
  --$2.3 million has been allocated for a residential energy-efficiency 
        initiative with approximately $7.5 million in leveraged funds 
        projected.
    Larger (utility-scale) renewable projects received $5 million. 
Sixty-nine renewable energy projects were funded in the past year 
alone.
    South Carolina.--In 2010, the South Carolina Energy Office awarded 
grants to 12 nonprofit organizations, colleges, and governments to 
reduce energy costs and implement alternative energy projects. The 
Columbia College solar water heating systems for the dormitories are 
one example of this initiative. Other projects include solar absorption 
cooling at Claflin University, solar water heating for Central Electric 
Power Cooperative customers and solar projects for Furman University.
    South Dakota.--$20.5 million has been dedicated to a State 
revolving loan for public buildings, with $3 million for a limited 
number of grants. Thirty-six projects are underway and activities 
include energy-efficiency retrofits, LEED ratings, on site generation, 
etc. The 100-year-old State capitol building was retrofitted, saving $2 
million per year for that project alone.
    Tennessee.--The State committed substantial resources to a 
comprehensive solar development program; 108 grants totaling $9 million 
have been awarded to a variety of solar projects, leveraging $24 
million in private funds. These projects includes both consumer 
projects as well as manufacturing development. The State has also 
expanded its energy efficiency programs.
    Texas.--$137.8 million has been allocated for public sector 
building energy efficiency, including revolving loans for schools, 
hospitals, municipalities, public colleges, etc., $52 million has been 
allocated for a competitive renewable energy grant program. 
Transportation efficiency programs have also been funded. Fifteen 
cities and one county recently installed energy efficient streetlights 
(with $7.8 million in SEP funds) that use one-thirtieth of the energy 
of the old technology. In Beaumont alone, 62 of the 168 traffic signals 
were replaced with energy-efficient technology.
    Washington.--More than $20 million was allocated for an energy 
efficiency and renewable energy loan and grant program, including a $2 
million grant to Port Townsend Paper Corp. for a biomass project that 
is supporting 398 full- and part-time jobs and leveraged $53 million in 
other funds. More than 10 times the amount of available funds was 
requested by potential recipients. Additional funding of $5 million was 
provided for energy-efficiency credit enhancements (supporting $50 
million in total project expenditures). Community-wide residential and 
commercial energy efficiency pilots received $14 million in grants. 
Other projects include an ``electric highway initiative establishing 
recharging locations on I-5, support for a 7.5 MW wind turbine at the 
Grays Harbor Paper mill in Hoquiam in cooperation with the Grays Harbor 
PUD and a $1 million project for a wood-fired boiler at Forks Middle 
School in the Quillayute Valley Schools district.
                                 ______
                                 
       Prepared Statement of the National Hydropower Association

    The National Hydropower Association (NHA) \1\ appreciates the 
opportunity to submit this statement regarding hydropower research and 
development (R&D) funding priorities for the fiscal year 2012 
appropriations budget cycle.
---------------------------------------------------------------------------
    \1\ NHA is a nonprofit, national trade association dedicated to 
promoting the Nation's largest renewable resource and advancing the 
interests of the hydropower and new ocean, tidal, conduit and in-stream 
hydrokinetic industries and the consumers they serve.
---------------------------------------------------------------------------
    NHA requests $100 million in the fiscal year 2012 Energy and Water 
Development Appropriations bill for the Department of Energy's (DOE) 
Waterpower Program to support initiatives across all hydropower 
technology sectors. The types of technologies covered are conventional 
hydropower, including pumped storage, as well as marine and 
hydrokinetic (MHK) technologies that access energy in ocean waves, 
tides, and the flowing water in rivers and man-made channels.
    A $100 million funding level, split equally between the 
conventional and MHK programs, is necessary to support a national goal 
to double U.S. capacity of renewable hydropower and the research needed 
to increase production and create more than 1.4 million cumulative new 
jobs all across the country. Investment in hydropower R&D will drive 
innovation across the economy and maintain American competitiveness and 
create jobs.
    Taking maximum advantage of our Nation's hydropower infrastructure 
by increasing efficiencies at existing hydro facilities and adding 
capacity at nonpowered dams are two near-term steps in the long-term 
effort to expand hydropower resources. However, development of some of 
this capacity requires necessary and needed R&D investment (both short 
and long term) in order to advance the state of the technology, study 
potential impacts, understand the extent of the developable resource, 
and more.
    In particular, Government funding is needed at the front end when 
private investments would not recoup the full value of the resulting 
social good. This is especially true in the case of basic R&D 
initiatives, where under-investment is prevalent.

            HYDROPOWER'S CURRENT AND POTENTIAL CONTRIBUTION

    As America's leading renewable electricity resource, hydropower 
currently provides approximately 7 percent of our Nation's electricity 
supply and two-thirds of America's renewable electricity.\2\ In 
addition, hydropower is positioned to meet 20 percent of President 
Obama's goal of 80-percent clean energy by 2035.
---------------------------------------------------------------------------
    \2\ Based on 2009 generation data. Energy Information 
Administration. http://www.eia.doe.gov/cneaf/electricity/epm/
table1_1.html.
---------------------------------------------------------------------------
    Looking to the future, NHA believes hydropower can double its 
contribution to the Nation's electricity portfolio, providing 
affordable, reliable, and sustainable baseload electricity through the 
responsible development and expanded use of conventional hydropower, 
pumped storage and new technologies, both MHK and conduit applications.
    Support for this forecast is evident. With approximately 100,000 MW 
of installed capacity today, recent studies have determined that 60,000 
MW of growth is possible by 2025 alone. Right now, there are projects 
with more than 88,000 MW of capacity before the Federal Energy 
Regulatory Commission (FERC). Applications for DOE Waterpower program 
funding opportunities in the past far outnumbered available funds--both 
for new MHK and conventional technologies. For example, in 2010 DOE 
awarded $32 million to seven projects to pursue upgrades to existing 
facilities, although dozens more projects submitted applications.
    In addition to the new generation this development will bring 
online, hydropower projects provide a host of ancillary services to the 
grid and environmental benefits. Hydropower facilities can quickly go 
from zero power to maximum output, making them exceptionally good at 
meeting rapidly changing demands for electricity throughout the day. In 
fact, because of its ability to be quickly dispatched, and its 
blackstart capability, hydropower was key in restoring power to the 
grid during the 2003 Northeast blackout. From a clean air perspective, 
hydropower generation in 2009 avoided more than 196 million metric tons 
of carbon emissions.\3\
---------------------------------------------------------------------------
    \3\ According to EPA Carbon Equivalencies Calculator http://
www.epa.gov/cleanenergy/energy-resources/calculator.html#results.
---------------------------------------------------------------------------
HYDROPOWER'S RESEARCH AND DEVELOPMENT NEEDS SPAN ALL INDUSTRY SECTORS--
     CONVENTIONAL, NEW HYDROKINETIC TECHNOLOGIES AND PUMPED STORAGE

    To realize the opportunity to increase hydropower generation that 
will strengthen our economy, environment and renewable energy supplies, 
continued and expanded funding support is needed to develop and deploy 
novel technologies, improve operational procedures, and provide 
rigorous analysis. Under a fully funded DOE Water Power program, all 
involved interests will have better access to information on the 
potential extractable energy from rivers and coastal waters; and 
technical support to harness this renewable resource through 
sustainable and cost-effective electric generation.
    Funding to support these goals should be directed to:
    Technology Development and Demonstration.--Improving hydropower 
technologies is the most important function of the Water Power program. 
Through previous funding, increases in efficiency and decreases in 
environmental impact have been realized. This investment must continue. 
New materials R&D and testing of better small- and low-head hydro 
technologies would bring down the costs of converting existing 
infrastructure for electricity generation and result in important 
upgrades and modernization of existing powerplants. Along these lines, 
initiatives that may be pursued include (but are not limited to):
  --Deployment support for projects, both MHK and conventional hydro;
  --Feasibility studies to identify additional low-cost, advanced-
        technology opportunities (Hydro Advancement Project); and
  --Development of operational tools, standard methods, and best 
        practices to maximize generation at existing and new 
        facilities.
    Resource Assessment/Environmental.--Innovation in the hydropower 
industry also goes beyond creating new technologies. The DOE program 
plays an important role in gathering baseline industry data, developing 
updated resource assessments and new growth analyses, studying project 
operations for maximization of both energy and environmental values, as 
well as studying new issues that may affect the industry--from 
potential effects of climate change on operations to addressing the 
energy storage needs to maintain a secure and functioning electric 
grid. Another key role for DOE is to determine the potential capacity 
on existing infrastructure. The work on the National Hydropower Assets 
Assessment Program is one example of a valuable tool that needs 
continued support. Also, the creation of a data clearing house of 
studies and funding for operations benchmarking would enable both the 
conventional and MHK industries to better forecast and model data and 
demonstrate the cost effectiveness of projects.
    Additional activities include:
  --Identify resources and address technology/policy needs to maximize 
        medium- to long-term opportunities;
  --Integrate resource assessments and cost curves with key pumped 
        storage and small hydro technology needs to identify critical 
        U.S. Army Corps of Engineers (COE) drivers; and
  --Provide market analysis to accurately quantify and monetize 
        hydropower ancillary services.
    Regulatory Analysis.--In addition to these areas, hydropower 
development faces a comprehensive regulatory approval process that 
involves many participants that includes FERC, Federal and State 
resource agencies, local governments, tribes, nongovernmental 
organizations, and the public. The system strives to promote 
development while protecting important environmental values. However, 
it can also contain redundancies and inefficiencies that unnecessarily 
slow the deployment of clean renewable hydropower and delay much-needed 
environmental enhancements and benefits. At a time when we need all the 
renewable, affordable, and reliable energy we can get, the United 
States needs an updated regulatory process that gets projects off the 
drawing board and puts people to work in a more efficient way. To 
support these efforts, programmatic funding could:
  --Engage regulators and environmental stakeholders to reduce license 
        time and cost;
  --Align energy generation and environmental priorities across river 
        basins to facilitate development; and
  --Generate data to more accurately correlate generation with 
        environmental impacts.

ASSOCIATED FUNDING SUPPORT FOR HYDROPOWER DEVELOPMENT WITHIN THE CIVIL 
             WORKS PROGRAMS OF THE ARMY CORPS OF ENGINEERS

    NHA is also working in partnership with Federal agencies to 
identify and pursue smarter and more efficient processes to develop 
hydropower projects on Federal facilities. A new Memorandum of 
Understanding signed recently by COE and FERC demonstrates an on-going 
and active commitment to work together and identify current challenges 
and opportunities to increase hydropower development.
    In this vein, NHA also calls for support of COE's own efforts to 
operate, maintain and upgrade its existing hydropower projects. NHA 
specifically supports the work COE is doing under its Hydropower 
Modernization Initiative (HMI) to develop a long-term capital 
investment strategy. One significant feature of the HMI is the Asset 
Investment Planning Tool, which was designed to:
  --analyze the condition of critical components and the consequences 
        of failure;
  --determine the value of additional hydropower and its cost;
  --quantify risk exposure for capital investments; and
  --create 20-year funding scenarios to allow for timely and cost-
        effective rehabilitation or replacement of hydropower 
        facilities and their components. To assist the Federal 
        Government in rehabilitating aging equipment, COE also is 
        pursuing increased use of non-Federal funds.

                               CONCLUSION

    Unlocking the vast hydropower potential of our rivers, oceans, 
tides, and conduits requires funding the R&D initiatives that make 
innovative ideas a reality. The DOE Water Power program is an important 
source of support for the researchers, scientists, and developers 
working to grow hydropower's contribution to our country's clean-energy 
resources. Continued investment in this program is crucial to ensuring 
that innovative new technologies come to market and are able to 
generate the clean electricity America needs.
    And the hydropower industry itself is doing its part to support 
investment in new technologies and project improvements. Among the 
hundreds of millions of dollars invested each year in environmental 
enhancements at hydro facilities, companies are supporting the 
development of a new generation of turbines that improve fish passage, 
generate more power, utilize water more efficiently, and improve the 
oxygen content of the water released downstream of a facility, among 
many other inventive technological and operational advancements.
                                 ______
                                 
Prepared Statement of the New Mexico Institute of Mining and Technology

    Dear subcommittee members: I am appealing to you to help deter the 
proposed budget cuts to the Department of Energy's (DOE) Fossil Energy 
Research and Development Program. My specific concern is for the 
National Energy Technology Laboratory (NETL) and its programs (such as 
Strategic Center for Natural Gas and Oil, NETL), which will be affected 
by the proposed cuts. The NETL provides the sustenance for important 
programs in research, education, and technology transfer.
    The NETL is the only U.S. National Laboratory dedicated to fossil 
energy technology. It funds a wide range of energy and environmental 
research and development programs that will benefit the United States 
for years to come. The NETL truly plays a crucial role in keeping 
oilfield research alive in the United States, increasing in importance 
in recent years as research activities within the oil industry decline 
drastically. Major companies have dramatically reduced their research 
capabilities while the independent oil and gas producers have virtually 
none. It is possible that the United States could lose its leadership 
role in oil and natural gas research and technology unless the oil and 
gas programs of the NETL can be maintained.
    It has been proposed that NETL's Natural Gas/Oil Technology program 
will be reduced in fiscal year 2011-2012. If this comes to pass, 
research programs both here at New Mexico Tech and all over the country 
could be severely impacted. Research conducted at American colleges and 
universities to increase domestic oil and natural gas production, to 
assist independent oil and natural gas producers, and to provide 
education and training in the newest technologies, will suffer. Efforts 
to provide technology transfer to the independent oil and natural gas 
producers of our oil and gas-producing States will likewise be 
drastically curtailed.
    The independent producers of the United States are now responsible 
for most domestic oil and gas production, as the major oil companies 
have increasingly sold their domestic oil assets to independents. 
Research sponsored by the DOE through such entities as NETL is the only 
significant source of unbiased technical research and development for 
these companies. As research at the National Laboratories, and the 
petroleum engineering departments and research institutes all over the 
United States will be severely impacted without this funding, service 
companies cannot fill the void created by this loss of research effort.
    Thus, one of the most strongly affected groups will be the 
independent oil and gas producers of the United States, who are now the 
backbone of the domestic industry. For many years, the NETL has 
supported enhanced oil recovery research in support of our Nation's 
independent producers, as well as natural gas research and technology. 
The lack of NETL-funded energy research may not be significant to major 
oil companies, but it will certainly burden these local, relatively 
smaller, independent oil and gas producers.
    Another facet of technology transfer that must not be overlooked is 
information. The information most needed by small producers are:
  --production data;
  --well information;
  --surface leasing information; and
  --many user-friendly software packages.
    DOE funding enables outreach groups affiliated with universities to 
offer these data free online. This in turn allows small producers to 
substantially reduce their overhead, thus enabling them to compete in 
the oil and gas industry.
    Finally, if oilfield research is discontinued, the vast amounts of 
residual oil remaining to be recovered in United States oilfields (more 
than 300 billion barrels) will be abandoned. Most of this cannot be 
recovered without the technological breakthroughs currently being 
sought through research funded by NETL. Reduced domestic oil production 
could potentially compromise our Nation's economic growth and security, 
forcing more and more reliance on imports.
    In conclusion, science and industry have looked to the NETL for 
many years to help provide solutions for the survival of domestic oil 
and gas production. The continued existence of many of our research 
organizations and academic departments depends on continuation of 
Federal funding in order to carry out their multiple missions of 
education, technology transfer and research, which will ultimately 
benefit the Nation. Loss of the NETL's oil and gas research funding, on 
the other hand, will damage these missions and ultimately diminish our 
pre-eminence.
                                 ______
                                 
           Prepared Statement of the Nuclear Energy Institute

    The Nuclear Energy Institute \1\ (NEI) supports the 
administration's request for fiscal year 2012 funding for the Nuclear 
Regulatory Commission (NRC) ($1.038 billion) and the following 
Department of Energy (DOE) programs:
---------------------------------------------------------------------------
    \1\ The Nuclear Energy Institute is the industry's policy 
organization, whose broad mission is to foster the beneficial uses of 
nuclear technology in its many commercial forms. Its membership, more 
than 350 corporate members in 17 countries, includes every U.S. utility 
that operates a nuclear powerplant as well as international utilities, 
plant designers, architect and engineering firms, uranium mining and 
milling companies, nuclear service providers, universities, 
manufacturers of radiopharmaceuticals, universities, labor unions, and 
law firms.
---------------------------------------------------------------------------
      Light Water Reactor/Small Modular Reactor Licensing Technical 
        Support.--$67 million.
      Fuel Cycle Research and Development.--$155 million.
      Light Water Reactor Sustainability Program.--$21.3 million.
      Nuclear Energy Enabling Technologies.--$97 million.
      Integrated University Program.--$45 million.
      Next-Generation Nuclear Plant.--$49.5 million.
      Innovative Technology Loan Guarantee Program Office.--$36 billion 
        in new loan guarantee authority for nuclear power projects.
    In addition, the nuclear energy industry strongly opposes 
legislation to impose a proposed tax on electric consumers for the 
uranium enrichment facility decontamination and decommissioning fund.

            ENSURING A STRONG NUCLEAR REGULATORY COMMISSION

    An independent, credible regulatory agency is required for public 
confidence in commercial nuclear energy facilities. During the next few 
years, NRC will be challenged to continue its inspection and licensing 
activities while analyzing the Fukushima Daiichi nuclear accident and 
determine what changes, if any, may be necessary in NRC requirements. 
Continuity and stability of the five-member commission during this 
critical time will be essential to ensure NRC staff and licensees have 
clear guidance on implementation of the lessons learned. NRC functions 
most effectively when it has a full complement of five commissioners, 
and the nuclear energy industry believes the Congress' highest priority 
should be ensuring that vacancies on the Commission do not occur.
    The industry supports fiscal year 2012 funding at the NRC's 
requested level of $1.038 billion, which is a $28.7 million decrease 
below its fiscal year 2010 funding levels. The industry remains 
concerned, however, at the steep escalation in agency budgets and 
staffing levels over the last decade, from 2,763 staff in fiscal year 
2001 to 3,981 staff proposed in fiscal year 2012, and from $487 million 
in fiscal year 2001 to more than $1 billion proposed in fiscal year 
2012. The industry recommends, therefore, that any additional 
Fukushima-related work be funded by re-allocating resources and 
achieving greater efficiencies, without compromising safety oversight 
of existing plants and ongoing licensing activities on license renewal, 
power uprates, reactor design certifications, combined construction and 
operating licenses and small modular reactor licensing issues. The 
industry believes the NRC can absorb additional analysis of the 
Fukushima accident without diverting resources from other programs. If 
the NRC cannot do so, the commission should explicitly provide the 
subcommittee with the specific resource needs and what the agency can 
do to accommodate new activities within its current budget.
    The industry applauds the continued oversight of the NRC by the 
Congress to prioritize agency actions. The agency has made some 
progress, but should continue to achieve greater transparency in its 
budgeting to reveal planned staffing and resource needs by individual 
divisions. This is particularly true concerning the defense and 
national interest programs funded by the taxpayer in appropriated 
funds. In any one year, NRC should ensure that these programs are 
funded at the entire 10 percent of available funds. A firewall should 
exist between fee and fee-relief sources of funds so the user fee is 
not used as an additional source of funding for appropriated programs. 
This would demonstrate to the Congress, the public and the industry, 
which pays 90 percent of the NRC's budget, that the budget fairly 
reflects those activities that are licensee-specific.
    Once again, the administration has proposed terminating the 
Integrated University Program, which supports the Nation's universities 
and community colleges. This program is unique in supporting important 
nuclear science and engineering research and workforce training. It is 
a vital program that provides financial support for students and junior 
faculty. The program is managed jointly with DOE's Office of Nuclear 
Energy and DOE's National Nuclear Security Administration and has been 
authorized by the Congress. NEI supports $15 million for NRC to 
continue its participation in the program in fiscal year 2012 and 
recommends that NRC fund the program at that level, not at the $11.5 
million it has proposed for fiscal year 2011.

              DEVELOPMENT OF ADVANCED REACTOR TECHNOLOGIES

    DOE's Office of Nuclear Energy fiscal year 2012 budget as proposed 
by the administration is lower than what was appropriated in fiscal 
year 2010. NEI supports the fiscal year 2012 budget as it continues the 
new initiatives for the Office of Nuclear Energy requested in fiscal 
year 2011. NEI believes that the following programs deserve support and 
represent the highest priorities for the nuclear energy industry:
      Light Water Reactor Sustainability Program.--$21.3 million;
      Light Water Reactor Small Modular Reactor Licensing Technical 
        Support.--$67 million;
      Nuclear Energy Enabling Technologies.--$97 million;
      Integrated University Program.--$45 million; and
      Next-Generation Nuclear Plant.--$49.5 million.
    The Idaho National Laboratory (INL) is designated as the lead lab 
for nuclear energy. INL maintains an extensive research infrastructure 
and workforce that will become even more vital for postaccident 
analysis and response to the radiological clean-up at Fukushima 
Daiichi.

 URANIUM ENRICHMENT DECONTAMINATION AND DECOMMISSIONING FUND TAX UNDUE 
                          BURDEN ON CONSUMERS

    The administration's fiscal year 2012 budget calls for legislation 
to reinstate the uranium enrichment decontamination and decommissioning 
fund, with a proposed tax on electric consumers of $200 million a year 
for 10 years. Electric utilities have already paid twice for 
decommissioning and decontamination at uranium enrichment plants that 
were originally operated by the Energy Department--first as part of the 
price for uranium enrichment services from the facilities and again 
under provisions of the Energy Policy Act of 1992. Under the 1992 law, 
the tax on utilities was to end after 15 years or the collection of 
$2.25 billion, adjusted for inflation. The utilities paid this amount 
in full as specified by law. NEI will continue to oppose this proposal 
in legislation and appreciates the support of the subcommittee in 
rejecting this proposal in fiscal year 2010 and fiscal year 2011.

                INTEGRATED USED FUEL MANAGEMENT PROGRAM

    The Government has an obligation under the Nuclear Waste Policy Act 
to dispose of used nuclear fuel from commercial reactors and defense 
applications. The industry believes licensing should be completed. 
Also, numerous State and local governments and the National Association 
of Regulatory Utility Commissioners are actively opposing DOE's 
withdrawal of the application for the Yucca Mountain repository at NRC 
and in the courts. The project should proceed and be funded so that the 
technical review of the license application is completed. The industry 
opposes the fiscal year 2012 budget request by the NRC to terminate the 
licensing proceeding. We urge the subcommittee to request a specific 
plan and resources required for continuing the Yucca Mountain licensing 
process, assuming the courts rule the application cannot be withdrawn.
    Given that it has been terminated, consumer payments into the 
Federal Nuclear Waste Fund should be suspended for the period of time 
for which there is no waste management program against which to assess 
costs. The industry supports a three-part integrated used fuel 
management strategy that includes:
  --on-site storage at reactor sites and development of centralized 
        storage at volunteer locations;
  --research, development, and demonstration of advanced fuel cycle 
        technologies; and
  --development of a permanent repository.
    NEI supports the work of the Blue Ribbon Commission on America's 
Nuclear Future to develop recommendations on how the Nation should 
manage used nuclear fuel and high-level radioactive waste and looks 
forward to reviewing the draft report scheduled for release this 
summer.
    Given the importance of this report, the subcommittee should 
encourage the commission to complete its work as soon as possible.
    The nuclear energy industry consistently has supported research and 
development of the advanced fuel-cycle technologies proposed in the 
Fuel Cycle Research and Development program ($155 million). DOE's plans 
should be adjusted based on its review of the recommendations of the 
Blue Ribbon Commission that the Congress accepts.

   INDUSTRY SUPPORTS $36 BILLION FOR DEPARTMENT OF ENERGY INNOVATIVE 
                  TECHNOLOGIES LOAN GUARANTEE PROGRAM

    The nuclear industry appreciates the support provided by the 
subcommittee for the DOE loan guarantee program for nuclear energy 
plants and uranium fuel-cycle facilities. NEI urges members to maintain 
the appropriated funds for projects under development for fiscal year 
2011. The administration has requested an additional $36 billion in 
loan volume in fiscal year 2012. This would provide sufficient loan 
volume for projects already in due diligence at DOE, and would provide 
certainty to other projects in the development pipeline that financing 
support will be available. Absent some certainty that financing will be 
available, companies may slow development of these projects.
    Loan guarantees for nuclear energy projects are not a subsidy and 
there is no cost to the taxpayer. The use of loan guarantees will lower 
the overall cost of nuclear energy projects, ultimately reducing the 
cost of electricity to consumers. Companies granted loan guarantees by 
DOE for nuclear energy projects must pay a premium for use of the 
program, plus cover all administrative costs.
    Budget scoring is not required for nuclear energy loan guarantees, 
because simply approving loan ``volume'' is not an appropriation. It 
simply authorizes the agency to issue loan guarantees up to that 
amount. For most loan guarantee programs, in which the Federal 
Government pays the cost of the loan guarantee, the 1990 Federal Credit 
Reform Act (FCRA) requires authorization of loan volume in an 
appropriations bill. However, the Government Accountability Office 
determined that the clean energy loan guarantee program authorized by 
the 2005 Energy Policy Act should not be subject to this FCRA 
requirement, because the companies receiving the loan guarantee pay the 
cost to the Federal Government of providing that guarantee--not 
taxpayers.
    NEI continues to believe that the clean-energy loan guarantee 
program, although essential, is not yet a workable financing platform, 
and urges the subcommittee to exercise its oversight responsibilities 
on implementation by the executive branch, particularly on the issues 
of the credit subsidy cost that project sponsors are expected to pay.

                         ENVIRONMENTAL CLEAN UP

    NEI supports DOE's budget request of $6 billion for the 
Environmental Management Office.
                                 ______
                                 
               Prepared Statement of NuScale Power, Inc.

    Dear Madam Chairman and ranking member: On behalf of NuScale Power, 
Inc. of Corvallis, Oregon we request that the subcommittee approve the 
President's budget request of $67 million for small, modular reactors 
(SMRs) within the Office of Advanced Reactor Research Development and 
Demonstration. This request includes both the research portion for 
advanced SMRs, but especially the commercialization cost-share portion 
for up to two light water reactor SMR designs.
    SMR technologies build on a rich history of American innovation and 
world-class nuclear design, manufacturing, and operations. The 
President has recognized the need for nuclear power as part of a 
comprehensive energy, environment and employment strategy for this 
country, including new financial incentives. NuScale is ready to 
deliver:
  --NuScale Power uses a one-third-scale test facility on the Campus of 
        Oregon State University to document critical tests required to 
        comply with Nuclear Regulatory Commission (NRC) design 
        certification and licensing. The next phases of regulatory 
        approval are costly in the United States and require Federal 
        support.
  --Since last year NuScale Power has conducted extensive discussions 
        with various government operations centers managed by both 
        Department of Energy (DOE) and Department of Defense. We are in 
        the process of scoping both research and deployment 
        opportunities that have the potential to benefit the Federal 
        Government directly by lowering the facilities' long-term costs 
        and reducing their greenhouse gas impacts as an electric power 
        consumer.
  --NuScale Power is constructing a full-scale control room simulator 
        to specifically address digital instrumentation, control, and 
        human factors analysis that will be integrated in all of the 
        next-generation nuclear plants, regardless of size. NRC staff 
        has visited Corvallis to review these plans and provide input.
  --As confirmed by a panel of independent experts whose work was 
        presented to the NRC in September 2009, NuScale Power has 
        achieved safety margins that are 10 times safer than the next 
        generation of large nuclear plants. This translates into 
        improved public safety and better financial risk management by 
        using scalable technology.
  --NuScale Power's inherently safe technology has received 
        considerable attention since the natural disaster and ensuing 
        nuclear incident in Japan. We have developed a 9-page ``safety 
        illustration'' that can be viewed on our Web site. It shows how 
        our reactor and spent-fuel pool might have responded to similar 
        events. From what we know now, the results are very positive.
  --Finally, in addition to the President's leadership in requesting 
        funding for research, development, and demonstration of SMRs, 
        NRC and its staff have also continued to provide the on-going 
        licensing support efforts in their own separate budget request. 
        In an NRC briefing held on March 29, 2011, NRC staff outlined 
        for the Commission the planned approach to licensing SMRs. 
        Staff concluded by saying, ''It's not a matter of whether we 
        can license these plants but how we best proceed.'' This was 
        encouraging to us, and is a positive sign that the Congress can 
        move forward with taxpayer dollars to support the licensing 
        efforts.
    Our company experienced a temporary financial setback earlier this 
year, but we are receiving considerable interest in new funding from a 
consortium that includes American manufacturers, fabricators, 
suppliers, constructors, and investment firms. We have advised DOE that 
we will be in a position to compete for Federal cost-sharing dollars as 
early as fiscal year 2011 if the program is approved by the Congress.
    NuScale Power wants to thank you and your subcommittee members for 
the support you have provided SMRs thus far. We look forward to 
continued work with you and your staff.
                                 ______
                                 
Prepared Statement of Richard Newton Hill, Jr., Former President/Owner 
                        of Hill Equipment Corp.

  ONE-HALF OF 1 PERCENT OF THE ENERGY IN THE OCEAN WAVES IS ENOUGH TO 
             PROVIDE THE ENTIRE WORLD'S ENERGY REQUIREMENTS

    I wish to introduce and obtain a grant for my wave-and-tide 
actuated renewable energy pump.

                       USE AND DISCLOSURE OF DATA

    This abstract includes data that shall not be disclosed outside the 
Government and shall not be duplicated, used, or disclosed--in whole or 
in part--for any purpose other than to evaluate this abstract in 
particular U.S. Patent Application continuation-in-part (CIP) 12220244. 
However, if an award is made as a result of--or in connection with--the 
submission of this data, the Government shall have the right to 
duplicate, use, or disclose the data to the extent provided in the 
resulting award. This restriction does not limit the Government's right 
to use information contained in this data if they are obtained from 
another source with restriction.
    Patent application CIP No. 12220244 is a continuation of U.S. 
Patent Application 10/600701. Patent Application 10/600701 was ready 
for issuance until this CIP was filed.
    I will explain my way of harnessing the energy in the ocean waves. 
You simply hang a great ballast weighted piston on a chain or cable 
attached to a float or ship. As the float or ship rises and falls the 
ballast-weighted piston located at or near the sea floor and enclosed 
in a pipe is raised and lowered, causing a pumping action that then can 
be converted into any form of energy you want. All other attempts up to 
this time, involve mounting fragile and/or complex structures at or 
near sea level to do the work. This gives you the task of dealing with 
changing tides and wave conditions and systems that do not hold up in 
the adverse conditions of the ocean. If you place the ballast weighted 
piston inside a tube, say going up 100 ft. high from the ocean floor, 
in say 200 ft. of water, you now have a simple, robust pump with an 
approximate vertical 100 ft. tide and wave range of operation. 
Alternatively, to use the same example, a hole could be drilled or 
excavated 100-200 feet deep in the ocean floor and the cylinder is 
placed in this hole. The pump, under this arrangement, then can be 
brought right up to the shoreline if needed.
    The initial steps are:
Phase I
    Provide feasibility studies, which will include modeling.
    Build a laboratory/shop model prototype pump.
    Determine how much energy can be captured by my invention off the 
shores of the United States and its possessions.
    Determine how much energy can be captured by my invention off the 
shores of other countries.
    Determine the best design for the buoy or float and other 
components. Wave action is the result of molecular excitation and for 
practical purposes extends about 15 feet below the surface.
    Selection of materials for buoy, pump cylinder, and piston.
    Submit results to the Department of Energy for justification of 
additional funding.
Phase II
    Build a hydroelectric power generating pilot plant approximately 
one-third the size of a full-scale electric powerplant capable of 
generating approximately 20 MW. This will be a permanent installation, 
will feed power into the power grid and be used to test any future 
modifications before they are put into general use. The renewable 
energy pumps will be placed in holes drilled in the ocean floor and/or 
on the ocean floor bed. The water they pump will be delivered to an 
enclosed dammed area and thence run through turbines to create 
electricity as the water flows back to the sea.
Phase III
    Build a full-scale hydroelectric powerplant with accompanying pumps 
and dam based on the experience of phases I and II.
    I have determined five additional significant uses for this pump:
      Seafood Farming.--Pump water to a levied area and raise fish or 
        shrimp, etc. When ready for harvest, you would let the water 
        out and scoop up the fish or shrimp by hand or mechanically, 
        eliminating the need for shrimp and fish trawlers, while 
        guaranteeing a harvest or catch every time. This is similar to 
        what is being done in some South American countries now, using 
        their high tides to capture the water behind levees, and is the 
        reason these countries can compete here in the United States 
        with local fishermen.
      Land Reclamation From the Sea, Etc.--Again, a levee would be 
        thrown up with the pump on the ocean or sea side. The suction 
        would run under the levee and excavate the water behind the 
        levee, leaving dry land.
      There Exists ``Dead'' Areas in the Sea, Depleted of Oxygen.--
        Pumps could be placed in these areas to circulate oxygen 
        enriched sea water in and eliminate the ``dead'' areas.
      Oil Contaminant Reclamation.--At surface level, a containment 
        barrier, as is used today, would be put in place. A skimmer 
        funnel would be placed inside the containment area just below 
        the surface, its' suction leading back down to one or more 
        pumps. The contaminants could be pumped up to a Tender where 
        further skimming would transpire. A final phase may be 
        introducing the oil/sea water mix into boiling brine. The water 
        would be absorbed into the brine and the difference in the 
        specific gravity between oil and brine will allow for a clean 
        cut in removing the oil. Alternatively, the contaminants could 
        be moved to a refinery or pumped to a levied area on shore for 
        further processing, containment, confinement, and removal. A 
        similar process, but with the suction at the bottom of the 
        ocean, can be developed for crude such as Bunker ``C'', which 
        have a tendency to remain on the seabed floor and eventually 
        wash ashore in balls of oil/sea water contaminants.
      Make the Deserts Bloom.--Pump the ocean water over or tunnel 
        through mountain ranges, such as the Sierra Mountains on our 
        west coast, spread the ocean water out on the desert floor. 
        Hydroelectric power would be created, first to provide booster 
        pumps, if needed, to assist moving the water over the 
        mountains, then on the downside, the energy would again be 
        reclaimed in the form of hydroelectric power, etc. The 
        resultant evaporation from the desert floor would form clouds 
        and the prevailing winds would carry the moisture eastward, 
        causing rain to fall, ``Making the Deserts Bloom'', as the 
        clouds meet the Rocky Mountains. If this proves feasible on our 
        western deserts, then Morocco with the Atlas Mountains and the 
        Sahara should become a top priority for me and the world to 
        relieve the economic and political tensions building there and 
        affecting us, bringing stability to that portion of the world. 
        The Sahara is equal or larger in size than the entire United 
        States. Hydroelectric power would again be created. Salt water 
        basins could be created to concentrate and extract minerals 
        from the sea as well as removing man made pollutants from the 
        world's oceans. The world populations demand for potable or 
        fresh water and food is projected to exceed the entire amount 
        of fresh water and food available by the year 2020, making this 
        the most important task to achieve as it will alleviate this 
        projected problem. When fully deployed, the additional moisture 
        added to the atmosphere will act like a ``radiator'' for the 
        Earth, moderating the Earth's climate as well as providing a 
        cleansing effect on the atmosphere by way of ``washing'' more 
        pollutants out of the air.

                         BACKGROUND OF INVENTOR

    Richard Newton Hill, Jr., hereafter called ``inventor'', attended 
UCLA, majoring in physics and the Georgia Institute of Technology, 
majoring in chemical engineering. The inventor went to work as an 
oilfield roughneck, drilling for oil on offshore drilling rigs in the 
Gulf of Mexico off the coast of Louisiana for about 5 years then worked 
another 5 years as a sales engineer selling construction, marine, 
industrial and oilfield equipment in the Louisiana and gulf coast 
regions. In 1967, the inventor launched his own business, Hill 
Equipment Corp., selling, repairing, fabricating and inventing 
equipment for the construction, marine, industrial, aerospace and 
oilfield industries, including the National Aeronautics and Space 
Administration (NASA), Michoud, New Orleans, Louisiana for the 
manufacture of the NASA space shuttle.
    The inventor is currently writing three books, has filed outside 
witness testimony with the U.S. Congress Subcommittee on Commerce, 
Justice, Science, and Related Agencies regarding allegations of the 
sabotage of the Space Shuttle Columbia and the assassination of 
President John F. Kennedy. This and related information can be viewed 
at the inventor's Web sites--www.sabotagecolumbia.info and 
www.sabotagecolumbia.com.
    The inventor is well versed in the technical feasibility of his 
invention' and there is nothing proposed that is not now technically 
feasible.
                                 ______
                                 
     Prepared Statement of the Society for Industrial and Applied 
                              Mathematics

    We are Dr. Lloyd Nicholas Trefethen, president, and Dr. Reinhard 
Laubenbacher, vice president for Science Policy, of the Society for 
Industrial and Applied Mathematics (SIAM). On behalf of SIAM, we are 
submitting this written testimony for the record to the Subcommittee on 
Energy and Water Development of the Senate Committee on Appropriations.
    SIAM has approximately 13,000 members, including applied and 
computational mathematicians, computer scientists, numerical analysts, 
engineers, statisticians, and mathematics educators. They work in 
industrial and service organizations, universities, colleges, and 
government agencies and laboratories all over the world. In addition, 
SIAM has more than 400 institutional members--colleges, universities, 
corporations, and research organizations. SIAM members come from many 
different disciplines, but have a common interest in applying 
mathematics in partnership with computational science toward solving 
real-world problems.
    First, we would like to emphasize how much SIAM appreciates your 
subcommittee's continued leadership on and recognition of the critical 
role of the Department of Energy (DOE) Office of Science and its 
support for mathematics, science, and engineering in enabling a strong 
U.S. economy, workforce, and society. DOE was one of the first Federal 
agencies to champion computational science as one of the three pillars 
of science, along with theory and experiment, and SIAM deeply 
appreciates and values DOE activities.
    Today, we submit this testimony to ask you to continue your support 
of the DOE Office of Science in fiscal year 2012 and beyond. In 
particular, we request that you provide the Office of Science with 
$5.42 billion, the level requested in the fiscal year 2012 budget 
request. SIAM is aware of the significant fiscal constraints facing the 
administration and the Congress this year, but we note that, in the 
face of economic peril, Federal investments in mathematics, science, 
and engineering create and preserve good jobs and help to maintain U.S. 
pre-eminence in innovation, upon which our economy depends.

          THE ROLE OF MATHEMATICS IN MEETING ENERGY CHALLENGES

    The Nation faces critical challenges in energy, including in energy 
efficiency, renewable energy, improved use of fossil fuels and nuclear 
energy, future energy sources, and reduced environmental impacts of 
energy production and use. As DOE and the research community design a 
long-term strategy to tackle these issues, the tools of mathematics and 
computational science (theory, modeling, and simulation) have emerged 
as a central element in designing new materials, predicting the impact 
of new systems and technologies, and better managing existing 
resources. Already, mathematical and computing researchers in 
universities, national laboratories, and industry are providing 
insights that propel advances in such fields as nanotechnology, 
biofuels, genomics, climate modeling, and materials fabrication.
    To tackle many of these challenges, DOE must be able to understand 
complex systems such as the U.S. power grid, the dispersion of nuclear 
radiation after a disaster, and the Earth's climate system. These and 
other complex systems have high levels of uncertainty, lack master 
plans, and are susceptible to breakdowns that could have catastrophic 
consequences. Understanding complex systems helps mitigate these risks 
and facilitate the development of controls and strategies to make 
systems more efficient.
    These issues were addressed in a May 2008 report by an independent 
panel of mathematicians that reviewed the challenges and strategic 
plans of all units of DOE in order to better define the goals for the 
DOE Applied Mathematics Program, which is located within the Office of 
Advanced Scientific Computing Research (ASCR) in the Office of 
Science.\1\ In light of the broad need for complex systems 
understanding, the panel recommended that DOE focus on three strategies 
for addressing the gaps in our understanding:
---------------------------------------------------------------------------
    \1\ Applied Mathematics at the U.S. Department of Energy: Past, 
Present and a View to the Future. A Report by an Independent Panel from 
the Applied Mathematics Research Community, May 2008. Available on line 
at http://brownreport.siam.org/Document%20Library/Brown_
Report_May_08.pdf.
---------------------------------------------------------------------------
  --Predictive modeling and simulation of complex systems.
  --Mathematical analysis of the behavior of complex systems.
  --Using models of complex systems to inform policy makers. (This 
        includes advancing the mathematics that supports risk analysis 
        techniques for policy-making involving complex systems that 
        include natural and engineered components, and economic, 
        security, and policy consequences.)
    While progress has been made in these areas since the 2008 report, 
further research is necessary to fully understand these systems and 
address our energy challenges.

                 DEPARTMENT OF ENERGY OFFICE OF SCIENCE

    Activities within ASCR play a key role in supporting research that 
begins to fulfill the needs described above. Particularly critical 
programs include: the Applied Mathematics program, the Scientific 
Discovery through Advanced Computing (SciDAC) program, and programs to 
maintain the pipeline of the mathematical workforce. SIAM supports the 
$466 million requested for ASCR for fiscal year 2012. SIAM appreciates 
that the requested increase for fiscal year 2012 is more balanced among 
ASCR programs and not entirely directed to investments in computing 
hardware as it was in the fiscal year 2011 request. Without investments 
in algorithm research, software development, and partnerships between 
mathematicians, disciplinary researchers, and computer and 
computational scientists, we cannot realize the full benefit of new 
high-performance computers or effectively develop the next generation 
of such computers.
    The applied mathematics and computational science and engineering 
work supported by the Applied Mathematics Program is a necessary 
element for many of the flagship efforts of the Office of Science and 
other units of DOE. Therefore, partnerships within the Department are 
critical for applying mathematics to key challenges in effective 
creation and use of a variety of energy sources. SIAM supports ASCR 
plans to initiate new partnerships with other DOE offices such as the 
Office of Electricity Delivery and Energy Reliability, the Office of 
Nuclear Energy, and the Office of Environmental Management. SIAM also 
supports the proposed activity on uncertainty and climate change within 
the Biological and Environmental Research Office, which will help to 
quantify the uncertainty in the predictions of current climate models, 
as well as the proposed activity on Computational Materials and 
Chemistry by Design within the Basic Energy Sciences Office.

        SUPPORTING THE PIPELINE OF MATHEMATICIANS AND SCIENTISTS

    Investing in the education and development of young scientists and 
engineers is a major step that the Federal Government can take to 
ensure the future prosperity and welfare of the United States. 
Currently, the economic situation is negatively affecting the job 
opportunities for young mathematicians--at universities, companies, and 
other research organizations. It is not only the young mathematicians 
who are not being hired who will suffer from these cutbacks. The 
research community at large will suffer from the loss of ideas and 
energy that these graduate students, postdoctoral fellows, and early 
career researchers bring to the field, and the country will suffer from 
the lost innovation.
    Maintaining the pipeline of the mathematical workforce with 
programs that fund research and students is especially important 
because of the foundational and cross-cutting role that mathematics and 
computational science play in sustaining the Nation's economic 
competitiveness and national security, and in making substantial 
advances on societal challenges such as energy. DOE programs support 
the educational and professional development of the researchers who 
will, at universities, companies, and the national laboratories, tackle 
the research problems (such as the complex system modeling described 
above) needed to change energy usage in this country. These young 
mathematicians and computational scientists are the drivers and 
employees of the clean-energy economy.
    Within the Office of Advanced Scientific Computing Research, the 
Computational Science Graduate Fellowship program is a highly 
successful and model program that enables students to receive robust 
training in mathematics and also learn to interface with a wide variety 
of other fields. We request that strong support for this program 
continue, as well as ongoing support for postdoctoral fellows at DOE 
national laboratories and universities. In addition, we endorse DOE's 
proposed continuation in fiscal year 2012 of the Office of Science 
Early Career Research Awards and Graduate Fellowships programs.

                    FISCAL YEAR 2011 APPROPRIATIONS

    Before concluding, we want to make a brief comment on the 
resolution of appropriations for fiscal year 2011. The 18-percent cut 
proposed for the Office of Science for the remainder of fiscal year 
2011 in H.R. 1 would devastate research that is critical for the 
country's energy and economic future while costing thousands of jobs at 
national laboratories and research universities across the country. 
SIAM urges you to provide at least the fiscal year 2010 level of 
funding for the Office of Science in fiscal year 2011.

                               CONCLUSION

    The programs in the Office of Science, particularly those discussed 
above, are important elements of DOE's efforts to fulfill its mission. 
They contribute to the goals of dramatically transforming our current 
capabilities to develop new sources for renewable and low-carbon energy 
supplies and improve energy efficiency to ensure energy independence 
and facilitate DOE's effort to increase U.S. competitiveness by 
training and attracting the best scientific talent into DOE 
headquarters and laboratories, the American research enterprise, and 
the clean-energy economy.
    We would like to conclude by thanking you again for your ongoing 
support of the DOE Office of Science and the actions you have already 
taken to enable DOE and the research and education communities it 
supports, including thousands of SIAM members, to undertake the 
activities that contribute to the health, security, and economic 
strength of the United States. The DOE Office of Science needs 
sustained annual funding to maintain our competitive edge in science 
and technology, and therefore we respectfully ask that you continue 
your support of these critical programs.
    We appreciate the opportunity to provide testimony to the 
subcommittee on behalf of SIAM and look forward to providing any 
additional information or assistance you may ask of us during the 
fiscal year 2012 appropriations process.
                                 ______
                                 
           Prepared Statement of Southern Company Generation

    Mr. Chairman and members of the subcommittee: Southern Company 
operates the U.S. Department of Energy's (DOE) National Carbon Capture 
Center (NCCC) (http://nationalcarboncapturecenter.com) at the Power 
Systems Development Facility (PSDF) in Wilsonville, Alabama for DOE's 
National Energy Technology Laboratory (NETL) and several industrial 
participants.\1\ The PSDF was conceived as the premier advanced coal 
power generation research and development (R&D) facility in the world 
and has fulfilled this expectation. NETL responded to the need for 
cost-effective carbon dioxide (CO2) capture technologies by 
establishing the NCCC which is collaborating with technology developers 
world-wide in accelerating development of lower-cost CO2 
capture technology for application to coal-fueled powerplants.
---------------------------------------------------------------------------
    \1\ Current PSDF participants include Southern Company, the 
Electric Power Research Institute (EPRI), American Electric Power, 
Luminant, NRG, Peabody Energy, Arch Coal, Inc., and Rio Tinto.
---------------------------------------------------------------------------
    I would like to thank the Senate for its past support of the NCCC 
and request the subcommittee's continued support of the DOE's Fossil 
Energy R&D core budget at recently enacted levels of $404 million per 
year. The Obama administration's fiscal year 2012 budget request of 
$291 million per year for DOE coal R&D is inadequate to provide the 
robust Fossil Energy program needed to enable development of a range of 
advanced technologies necessary to assure continued use of coal. At a 
time when our country's economy is recovering, we need to assure 
continued utilization of domestically produced, low-cost, coal-based 
power generation. DOE's Fossil Energy R&D efforts have produced 
significant results to advance coal-based power. DOE's core R&D 
budgets, combined with investments by the private sector assure a 
sustainable technology base on which to address the environmental and 
economic challenges facing continued coal utilization. The continued 
operation of the NCCC in partnership with DOE will benefit the Nation 
by responding to the need for developing cost-effective CO2 
capture technology for coal-fueled power generation by teaming with 
technology developers funded through the DOE Fossil Energy program and 
accelerating the progress of those technologies toward commercial 
deployment by testing and evaluation at the NCCC.
    The NCCC offers a flexible applied R&D test facility which provides 
commercially representative flue gas and syngas and the necessary 
infrastructure in which developers' technologies are installed and 
tested to generate data for performance verification under industrially 
realistic operating conditions. This effort can bridge gaps between 
fundamental R&D and large-scale commercial demonstration and provides 
for a seamless transition for promising CO2 technologies to 
migrate from laboratory into commercial applications. The DOE program 
for CO2 capture in coal-fueled powerplants is divided into 
three areas:
  --postcombustion capture for conventional pulverized coal plants;
  --pre-combustion capture for coal gasification powerplants; and
  --oxy-combustion processes which produce a more CO2-rich 
        flue gas than conventional combustion for easier CO2 
        capture.
    The NCCC's CO2 capture efforts address all three areas.
    Southern Company also supports the goals of the Clean Coal 
Technology Roadmaps developed by DOE, EPRI, and the Coal Utilization 
Research Council (CURC). These Roadmaps identify the technical, 
economic, and environmental performance that advanced clean-coal 
technologies can achieve over the next 20 years. Over this time period, 
coal-fired power generation efficiency can be increased to more than 50 
percent (compared to the current fleet average of 32 percent) while 
producing de minimis emissions and developing cost-effective 
technologies for CO2 management.

                                SUMMARY

    The United States has historically been a leader in energy 
research. Adequate funding for fossil energy research and development 
programs, including environmental and climate change technologies will 
provide our country with secure and reliable energy from domestic 
resources while protecting our environment. Current DOE Fossil Energy 
Research and Development programs for coal, if adequately funded, will 
assure that a wide range of electric generation options are available 
for future needs. The Congress faces difficult choices when examining 
near-term effects on the Federal budget of funding energy research. 
However, continued support for advanced coal-based energy research is 
essential to the long-term environmental and economic well being of the 
United States. Prior DOE clean-coal technology research has already 
provided the basis for $100 billion in consumer benefits at a cost of 
less than $4 billion. Funding the administration's budget request for 
DOE coal R&D and long-term support of the Clean Coal Technology Roadmap 
can lead to additional consumer benefits of between $360 billion and 
$1.38 trillion.\2\ But, for benefits to be realized, the critically 
important R&D program in the Clean Coal Technology Roadmap must be 
conducted.
---------------------------------------------------------------------------
    \2\ EPRI Report No. 1006954, ``Market-Based Valuation of Coal 
Generation and Coal R&D in the U.S. Electric Sector'', May 2002.
---------------------------------------------------------------------------
    One of the key national assets for achieving these benefits is the 
NCCC. The fiscal year 2012 funding for the NCCC needs to be about $45.4 
million to operate (and modify as needed) the facilities to test 
technologies that are critical to the goals of the DOE Carbon 
Sequestration Technology Roadmap and to the success of the development 
of cost-effective climate change technologies that will enable the 
continued use of coal to supply the Nation's energy needs. Any budget 
cuts (for example from $404 million to $291 million per year) in the 
DOE Fossil Energy Core R&D budget could proportionately impact the 
NCCC. A key feature of the NCCC is its flexibility to test new carbon 
capture technologies for coal-based power generation systems in an 
integrated fashion. The NCCC can evaluate solvent, sorbent, and 
membrane CO2 capture technologies as they are integrated 
into actual syngas (from gasification) or flue gas from actual 
powerplant operations. Integrated operation allows the effects of 
system interactions, typically missed in un-integrated, laboratory-
based, component development programs, to be understood. Testing at the 
NCCC allows the maintenance, safety, and reliability issues of a 
technology to be investigated at a cost that is far lower than the cost 
of commercial-scale testing. The NCCC is large enough to produce data 
to support commercial-scale demonstration plant designs, yet small 
enough to be cost-effective and adaptable to a variety of technology 
research needs. Moreover, by operating a unique, but central R&D test 
facility, available to all CO2 technology developers, 
redundancy in testing sites and equipment is minimized and cost-
effective use of R&D funds is achieved. The major accomplishments at 
the NCCC/PSDF to date and the current test program planned by DOE and 
the NCCC's industrial participants are summarized below.

                         PRIOR ACCOMPLISHMENTS

    The PSDF test-bed has operated successfully for many years in 
support of DOE's advanced coal program. The two significant 
achievements were in a gasifier suitable for use with low-rank fuels, 
and hot gas filtration to improve energy efficiency. These two 
technologies have progressed to commercialization with integrated 
gasification combined cycle (IGCC) powerplant being built at Kemper 
County, Mississippi, and Dong Guan, China. Skilled staff from 
disciplines essential for a successful research program has gained 
experience by designing and operating the test equipment and by working 
with vendors to develop and improve their technologies. The NCCC/PSDF 
has developed testing and technology transfer relationships with more 
than 50 vendors to ensure that test results and improvements developed 
at the NCCC/PSDF are incorporated into future plants. In some 
instances, testing has eliminated technologies from further 
consideration. Such screening is valuable in that it concentrates R&D 
effort on those technologies most likely to succeed and is an essential 
part of managing the DOE's financial resources. Major subsystems tested 
and some highlights of the test program at the NCCC/PSDF include:
  --the transport reactor;
  --Advanced particulate control systems;
  --Filter Safe-Guard Device; and
  --Coal feed and ash removal subsystems:
    --Syngas cooler enhancements; and
    --Sensors and controls automation improvements.
    These components were integrated into a Transport Integrated 
Gasification (TRIGTM) system and successfully tested at the 
NCCC/PSDF. The TRIGTM process is now being scaled-up for 
commercial deployment. However, the pilot-scale test components remain 
in place and form the basis of a highly flexible, unique testing 
infrastructure to enable pre-combustion (i.e., Gasification based) 
CO2 capture technologies to be evaluated.

          NATIONAL CARBON CAPTURE CENTER CURRENT TEST PROGRAM

    Building on success with TRIGTM, the NCCC/PSDF facility 
has now refocused its mission on supporting the development and scale-
up of cost-effective, commercially viable carbon capture technologies 
for coal-fueled powerplants through collaboration with the DOE and 
third-party technology developers. Most of the current CO2 
capture technologies are being developed at laboratory- or bench-scale 
under ideal conditions. Continued R&D under realistic field conditions 
are needed to validate laboratory results and identify technical issues 
that are not present under ideal conditions. In collaboration with 
technology developers, the NCCC makes available coal-derived syngas and 
flue gas to carry out applied R&D on components or small pilot-scale 
systems to bridge gaps between fundamental R&D and large-scale 
commercial demonstration and provides for a seamless transition for 
promising technologies to migrate from laboratory into commercial 
applications.
    The NCCC is a unique applied R&D test facility that consists of two 
major sets of infrastructure to support CO2 capture 
technology development. One is the existing pilot-scale coal 
gasification facility that produces syngas for pre-combustion 
CO2 capture technology evaluation and the other is the newly 
constructed Post-Combustion Carbon Capture Center (PC4) which enables 
testing of capture technologies on flue gas from an adjacent pulverized 
coal powerplant. Both are readily adaptable to test a variety of 
technologies at multiple scales, providing data for scale-up to 
commercial applications. This flexibility in conjunction with real-
world operating conditions, allows the NCCC to support developers in 
advancing the CO2 capture technologies that are critical to 
continued use of coal for power generation. Jointly with the DOE, NCCC 
has developed a Technology Screening Process which is a key evaluation 
tool to assess and prioritize technologies for testing at the facility. 
This process also ensures that final technology selection will form a 
balanced portfolio that promotes the advancement of both near-term and 
long-term candidate technologies.
    Postcombustion.--Today's postcombustion capture technology is 
estimated to increase the cost of electricity (COE) by up to 80 
percent.\3\ For both new and existing powerplants, postcombustion 
capture technology must be made more efficient and cost-effective by 
reducing parasitic power and capital cost requirements. In 
postcombustion capture, CO2 is separated from the flue gas 
in a conventional coal-combustion powerplant downstream of the 
pulverized coal boiler. Many postcombustion capture technologies need 
to be proven and integrated in an industrial powerplant setting. 
Activities at the NCCC for postcombustion capture technology include:
---------------------------------------------------------------------------
    \3\ ``Cost and Performance Baseline for Fossil Energy Plants, 
Volume 1: Bituminous Coal and Natural Gas to Electricity, Final 
Report''; NETL, May 2007.
---------------------------------------------------------------------------
      Post-Combustion Carbon Capture Center.--This test facility is 
        being built to accommodate tests of a wide-range of capture 
        technologies from flue gas. The test facility includes three 
        major test areas:
    --a pilot solvent test unit to test developers' next-generation 
            CO2 absorption solvents;
    --a second test bay to support evaluation of fully integrated test 
            systems supplied by technology developers; and
    --a bench-scale test area to accommodate up to four small test 
            skids of emerging, advanced technologies such as sorbents 
            or membrane systems.
      Pilot Solvent Test Unit.--This facility is designed and 
        construction and commissioning were recently completed. Testing 
        is underway with a reference solvent and will begin later this 
        year on alternative advanced solvents with potential 
        improvements in loading capacity, kinetics, or lower heats of 
        regeneration.
      Advanced Technology.--Compact membrane contactors and solid phase 
        CO2 sorbents, currently being investigated by DOE-
        NETL and private companies, will be assessed and installed. 
        NCCC will provide such technologies a scaled-up testing 
        platform as development progress warrants.
    Pre-Combustion.--In pre-combustion capture, CO2 is 
separated from the syngas produced by a coal-gasification process, 
prior to the combustion of the syngas in gas turbine for power 
generation. CO2 capture for IGCC is estimated to increase 
COE greater than 35 percent.\3\ Reducing parasitic power and capital 
cost requirements is also needed for development of efficient and cost-
effective pre-combustion technology. R&D activities at NCCC for pre-
combustion capture technology for application to gasification-based 
power generation include:
      Advanced CO2 Capture Systems.--New solvents and gas-
        liquid contacting devices are being assessed on syngas. New 
        CO2 separation technologies (sorbents or membranes) 
        are being scaled-up and tested based on fundamental R&D 
        progress by third-party developers.
      Water Gas Shift Enhancements.--Water Gas Shift (WGS) catalyst 
        test results have been conducted which reveal that parasitic 
        steam consumption can be reduced, which in turn increases the 
        net power output of an IGCC plant and reduces COE with 
        CO2 capture. Results have been supplied to catalyst 
        suppliers and findings are being implemented at a commercial 
        IGCC plant currently under construction. Testing of various WGS 
        catalysts will continue.
      Advanced Syngas Cleanup.--New advanced syngas cleanup systems are 
        being tested for reducing hydrogen sulfide, hydrochloric acid, 
        ammonia, and mercury to near-zero levels.
    Oxy-Combustion.--The NCCC is also evaluating the potential benefits 
of oxy-combustion CO2 capture using the pressurized 
transport reactor operating in oxygen combustion mode. Preliminary 
screening studies have been conducted with favorable results. Detailed 
system studies, modeling, and additional economic analysis are being 
conducted to evaluate the commercial feasibility of this technology.
    Gasification.--In developing a cost-effective advanced coal 
powerplant with CO2 capture, all process blocks within the 
powerplant must be optimized in addition to the capture block. 
Including CO2 capture in an advanced coal powerplant will 
increase the plant COE, so opportunities to reduce cost in every part 
of the process will be explored. With highest priority being given to 
low-cost CO2 capture process development, projects that 
reduce overall capital and operating costs will also be included in the 
NCCC test plan to partially offset incremental cost increases from 
CO2 capture addition. These cost reduction projects include 
technology development for syngas cleanup, particulate control, fuel 
cells, sensors and controls, materials, and feeders.

                               CONCLUSION

    The collaboration among DOE Fossil Energy core R&D, technology 
developers, and private industry supported National Carbon Capture 
Center is making great strides toward advancing the next generation of 
CO2 capture technologies. These technologies hold the 
promise of reducing the costs of CO2 capture to levels 
necessary to assure that affordable, reliable coal-based electric power 
can be produced for America's economy, while also meeting all of the 
environmental challenges associated with coal use. The Congress should 
sustain the DOE Fossil Energy R&D budgets at historical levels.
                                 ______
                                 
                    Prepared Statement of Symbiotics

    On behalf of America's independent power producers and hydropower 
developers, I respectfully request the full appropriation in fiscal 
year 2012 of funds authorized in section 242 and section 243 of the 
Energy Policy Act of 2005 (Public Law 109-58). Full funding for the 
Hydroelectric Production Incentives and Hydroelectric Efficiency 
Improvements authorized in Public Law 109-58 is critical for getting 
new hydropower projects into production.
    Currently, there are numerous projects across the United States 
that are under construction, or nearing the construction phase, that 
would be eligible to receive these important incentives if they are 
appropriated for fiscal year 2012. These projects need the incentives 
to remain competitive for private financing. Without these production 
and efficiency incentives, many of the projects under development will 
become uneconomical and may never be built.
    As you may know, the provisions in section 242 and 243 of the 
Energy Policy Act of 2005 were critical in facilitating the financing 
necessary to make many hydroelectric projects economically feasible 
while pursuing the permitting processes. The subsequent appropriation 
of these funds would enable developers across the country to complete 
their projects. This would allow for the production of clean 
electricity that would be more cost effective than other forms of 
renewable energy including wind and solar. Furthermore, it would help 
our Nation achieve energy independence and foster significant new job 
creation.
    Since passage of the Energy Policy Act of 2005, appropriation of 
section 242 and 243 funds was unnecessary because no projects existed 
that were capable of utilizing them. Now, hydropower developers and 
producers are far enough in the development process that these funds 
could be used. In fact, the hydropower projects that are currently 
being developed represent the first new nonmunicipal hydro projects to 
come on line in more than two decades. Full appropriation of section 
242 and 243 funds would provide the critical assistance to get these 
vital projects into production.
    Symbiotics appreciates the opportunity to submit testimony for the 
record.
                                 ______
                                 
          Prepared Statement of Technology International, Inc.

    The development and acceptance by the industry of technology 
development designed to minimize drilling risks needs to be supported 
by the United States Government to assure the safety of offshore 
drilling, especially in the deep water Gulf of Mexico.
    Surface seismic surveys provide the initial reservoir information 
for well planning deepwater wells. Seismic techniques are increasingly 
being developed to better image potential drilling hazards, such as 
unstable shallow gas pockets and abnormal high pressures ahead of the 
bit using so-called ``look-ahead'' seismic. Accurate, high-resolution 
seismic data often are not available for critical deepwater development 
projects because of inherent limitations of surface seismic technology 
and difficulties in getting an accurate characterization of formations 
where salt layers are present. Using borehole seismic technology 
throughout the drilling process can play an important role in 
generating more accurate, higher-resolution seismic data for reducing 
the often substantial risks and uncertainty associated with deepwater 
drilling.
    Borehole seismic systems with a surface noise source and a downhole 
receiver are currently commercially available. However, these systems 
are expensive, cumbersome to deploy, have difficulty working in a salt 
environment, they do not provide the ability to ``look ahead of the 
drill bit'', and the information available at the surface for real-time 
decisionmaking is constrained by the bandwidth of the measurement while 
drilling communications link, making this type of seismic while 
drilling (SWD) less practical in deep Gulf of Mexico applications. SWD 
with a downhole noise source, currently not available, could 
effectively overcome these limitations. Seismic while drilling would 
help reduce uncertainty and risk, and improve safety in the deepwater 
well construction process.
    A workshop sponsored by the Department of Energy (DOE) funded 
Research Partnership to Secure Energy for America (RPSEA) included 
invited 125 industry experts, selected based on their individual 
technical qualifications. The workshop was held on July 22, 2010, at 
the Houston Area Research Council facility in Houston, where a diverse 
group of technologies that would help minimize drilling risks were 
identified and evaluated. Afterwards, a poll was taken of the workshop 
participants to identify those technologies that would be of greatest 
value for Gulf of Mexico drilling in deep water and should be the 
industry's highest priority. Two areas selected as highest priority to 
prevent another Gulf of Mexico well blowout were early detection of gas 
influx and better SWD data. Looking ahead of the bit, SWD using a 
downhole source is practical, and will, after sufficient funding 
becomes available, provide real-time seismic images used to accurately 
determine pressures ahead of the drill bit. The availability could be 
accelerated if DOE were to provide ``emerging technology funding'' to 
RPSEA to make ``look ahead'' seismic technologies available to the 
deepwater operators within 12-18 months.
                                 ______
                                 
   Prepared Statement of the Universities Research Association, Inc.

    Chairman Feinstein, Ranking Member Murkowski, members of the 
subcommittee, on behalf of Universities Research Association, Inc. 
(URA), I appreciate this opportunity to comment on the administration's 
fiscal year 2012 budget submission for the Department of Energy (DOE). 
URA, a nonprofit organization comprised of 86 member universities, 
serves together with the University of Chicago through the Fermi 
Research Alliance, LLC, as the DOE contractor for the management and 
operation of the Fermi National Accelerator Laboratory (Fermilab). I 
write to express our grave concern for the future of fundamental 
research in the physical sciences in light of the proposed 2012 budget.
    Scientific research is critical to innovation, which is fundamental 
to job creating, economic growth, and global competitiveness. Studies 
have demonstrated unequivocally double-digit percent returns on the 
Nation's investments in fundamental discovery research. Once in an 
unquestioned lead role across all fields of research, we now face 
significant competition from other countries, like China, that have 
understood the importance of investment in science and technology for 
economic growth.
    The President continues to place a priority on DOE in his fiscal 
year 2012 budget request, proposing $29.5 billion which represents an 
increase of $3.1 billion (11.8 percent) more than the fiscal year 2010 
enacted level. Within the President's proposed overall freeze on 
nonsecurity discretionary spending, this is a significant commitment by 
the administration. For DOE, as the Nation's premier funding agency for 
the physical sciences, it is welcome news that the President proposes 
$5.42 billion for the basic research carried out by the DOE Office of 
Science. The President would increase funding for fundamental research 
by about 9 percent more than the fiscal year 2010 level.
    However, the lack of balance within the research programs of the 
Office of Science is troubling. For example, the President proposes a 
24-percent funding increase for the Office of Basic Energy Sciences; a 
22-percent increase for the Office of Biological and Environmental 
Research; and a 21.5-percent increase for Advanced Scientific Computing 
Research. In contrast, High Energy Physics is essentially frozen at the 
fiscal year 2010 enacted level ($797.2 million, an increase of $6.4 
million or 0.8 percent), and Fusion Energy Sciences is reduced below 
the fiscal year 2010 funding request to $399.7 million (a reduction of 
$18 million or 4.3 percent).
    This is a particularly critical time for High Energy Physics as 
Fermilab, the Nation's only national laboratory devoted to research in 
particle physics, transitions from the highly successful running of the 
Tevatron Collider to new projects at the Intensity Frontier of particle 
physics. The Tevatron will shut down at the end of fiscal year 2011, as 
originally planned, now that the Large Hadron Collider in Europe has 
become the focus of research at the Energy Frontier. Fermilab is ready 
to begin new experiments that will put the United States at the 
forefront of studies of neutrinos, a key area of study to understand 
the Standard Model and how the universe began. The delay in completing 
the fiscal year 2011 appropriations bills, in turn, has delayed the 
start of the new undertakings critical to the future of the laboratory.
    High Energy Physics has blazed the path of international 
cooperation on large scientific projects with scientists collaborating 
on the planning, design, construction, and operation of facilities all 
over the world. The field hosts thousands of researchers each year at 
the various experiments and serves as a premier training ground for 
American university students to develop the next generation of 
scientists, engineers, and technicians to carry out discovery science 
and innovation. High Energy Physics, and Fermilab in particular, has 
long reached out to K-12 students to engage their interest in the 
science, technology, engineering, and mathematics fields, which are 
important to the future economic competitiveness of the Nation.
    The America COMPETES Act, reauthorized by the Congress only this 
past December, affirms a bipartisan commitment to double the science 
budgets of DOE and the National Science Foundation over the next 10 
years. The current budget situation is indeed critical. But the growth, 
prosperity, and employment increase needed to deal with it over the 
long term are not achievable without the vibrant economy made possible 
through the innovation and research in which the physical sciences play 
a key role.
    As a university-based organization in partnership to operate and 
manage Fermilab, we urge the subcommittee to support funding for High 
Energy Physics within an overall balanced research program in the basic 
physical sciences within the Office of Science. We urge that the 
subcommittee approve, at a minimum, the President's request for High 
Energy Physics and specifically that it approve the $56 million 
associated with the planned new experiments at Fermilab.
                                 ______
                                 
   Prepared Statement of the University Corporation for Atmospheric 
                                Research

    On behalf of the University Corporation for Atmospheric Research 
(UCAR) and the university community involved in Earth sciences research 
and education, I submit this written testimony for the record of the 
Senate Committee on Appropriations, Subcommittee on Energy and Water 
Development. UCAR is a consortium of 76 research universities that 
manages and operates the National Center for Atmospheric Research 
(NCAR) on behalf of the National Science Foundation and the university 
community.
    This Nation must deal with critical national and global energy 
challenges. At a time when we need more research, technological 
innovation, and solutions, I am deeply troubled by the level of cuts 
that the U.S. House of Representatives has proposed for DOE in fiscal 
year 2011, especially the truly destructive cuts proposed for the DOE 
Office of Science (DOE OS), whose basic research is among the most 
valuable and cross-cutting in the world. While I understand that the 
Congress faces difficult budget choices in reining in a growing 
deficit, it would be a mistake for the Congress to balance the budget 
on the back of DOE's research and development. I urge the subcommittee 
to fund the fiscal year 2012 budget request for the DOE OS at $5.42 
billion and the Office of Energy Efficiency and Renewable Energy (EERE) 
at $3.2 billion.
    DOE programs and initiatives in science and education directly 
support university and laboratory communities, funding the work of 
preeminent scientists in our field. Without DOE support, our capacity 
to understand and advance numerous fields of science, including the 
atmospheric sciences, would be seriously compromised. DOE is central to 
the country's economic and technological world leadership and to our 
ability to secure an economically and environmentally sustainable 
future for ourselves and our children. This is why the bipartisan 
National Commission on Fiscal Responsibility and Reform recommended 
that, even amidst major agency spending cuts, the Nation must continue 
to ``expand high-value research and development in energy and other 
critical areas''.
    With the following, I highlight several science research and 
education programs that represent DOE's critical contributions to 
American leadership in science and technology.

                   CLIMATE AND EARTH SYSTEM SCIENCES

    The Office of Biological and Environmental Research (BER) within 
DOE OS makes fundamental contributions to the Nation's premier Earth 
system models and data analysis infrastructure that provide the 
scientific foundation for future decisionmaking on environmental 
change. Without them we would not know the level of risk that cities, 
States, and businesses face from long-term weather trends and what 
societal preparation and adaptation might be needed.
    In particular, BER provides indispensable support to the Community 
Earth System Model (CESM), a joint DOE-NCAR effort that is a 
comprehensive and sophisticated model for analyzing Earth's past, 
present, and future. CESM is a major contributor to national and 
international assessments of environmental change. And while CESM is 
housed and managed at NCAR, it is an open-source climate model, 
involving scientists across the Nation and around the world in making 
contributions and improvements.
    Thanks in part to BER support, CESM and the Nation's other climate 
models are becoming more realistic, incorporating more precise and 
complex natural and human processes that are shaping the global 
climate. For example, the Climate Science for Sustainable Energy Future 
program, a joint effort between NCAR and DOE's Lawrence Berkeley 
Laboratory, is embedding the socioeconomic and energy technology 
components of integrated assessment models into the CESM model in order 
to better understand how the planting of biofuel crops will affect the 
atmosphere, soil, water, and agriculture. These new capabilities will 
allow the climate science community to address societally relevant 
questions in a way that has not been possible in the past.
    New in fiscal year 2012, BER-supported scientists will study 
methods to rapidly integrate new sub-models, datasets, and other model 
components into global Earth system models. Another focus will be 
enabling Earth system models to effectively use future computer 
architectures, such as the new IBM Blue Gene/Q being commissioned at 
Argonne National Laboratory. BER scientists will also expand arctic 
climate research activities and develop new observation capabilities 
for clouds, aerosols, and the terrestrial carbon cycle in this globally 
important and climatically sensitive region. A new Atmospheric 
Radiation Measurement Climate Research Facility site to be developed in 
the Azores will provide critical long-term observations for marine 
clouds and aerosols. Such new research efforts strengthen existing BER 
atmospheric process studies and modeling and are critical for the 
advancement of this scientific field.
    In order to develop more accurate, increasingly realistic, and 
higher-resolution Earth system models, with better environmental 
predictive capabilities for businesses and communities, I urge you to 
fund BER within the DOE OS at the requested $717.9 million for fiscal 
year 2012.

                 ADVANCED SCIENTIFIC COMPUTING RESEARCH

    Also within DOE OS, Advanced Scientific Computing Research (ASCR) 
delivers leading-edge computational and networking capabilities to 
scientists nationwide, enabling advances in computer science and the 
development of specialized software tools necessary to answer major 
scientific questions being addressed by OS and the larger university 
community.
    ASCR's continued progress is of particular importance to 
atmospheric scientists involved with Earth system model development. 
Representing the complex processes and interactions of the Earth's 
systems, while efficiently harnessing the enormous amount of computing 
power necessary, requires very advanced software engineering, computer 
science, and numerical techniques. Because the climate simulations 
using the CESM (described above) are too computationally intensive to 
be run at NCAR alone, they are outsourced to the DOE's Leadership 
Computing Facilities. At Oak Ridge National Laboratory, a new 2.33 
petaflop system is available to the scientific community, and Argonne 
National Laboratory (ALCF) has proposed building a 10 petaflop IBM Blue 
Gene/Q supercomputer next year. The fiscal year 2012 request supports 
continued operations of existing supercomputing systems as well as the 
new ALCF 10 petaflop system.
    DOE's computing capacity is essential to the country. Each major 
upgrade unlocks reams of new detail and data on the characteristics of 
our current and future Earth system. A failure to maintain and continue 
to upgrade these Leadership Computing Facilities would seriously 
undermine the steady progress of the scientific enterprise in this 
area.
    The results of this research and other research like it are brought 
to the broader scientific community through the Scientific Discovery 
through Advanced Computing (SciDAC) program. SciDAC facilitates the 
transfer of basic research into computational science applications 
through direct partnerships between applied mathematicians and computer 
scientists.
    I urge you to fund ASCR within DOE OS at the President's full 
fiscal year 2012 budget request of $465.6 million.

           WORKFORCE DEVELOPMENT FOR TEACHERS AND SCIENTISTS

    DOE OS's education programs, such as the Workforce Development for 
Teachers and Scientists (WDTS) program, are essential to maintaining 
U.S. leadership in science, technology, engineering, and mathematics 
(STEM). WDTS supports, educates, and trains the Nation's STEM workforce 
and facilitates the development of the knowledge and expertise that 
will prepare us to address future energy and environmental challenges.
    WDTS has launched the DOE OS Graduate Fellowship Program to support 
U.S. graduate students pursuing degrees in areas of basic science and 
engineering. The goal of the program is to encourage talented students 
to pursue research-focused graduate studies in physics, chemistry, 
biology, mathematics, computer science, engineering, and environmental 
science.
    Programs like WDTS have produced tens of thousands of leading 
scientists, engineers, and technicians who have dedicated their careers 
to working on the great challenges of the day, including climate 
change, while pursuing answers to many of the most important scientific 
questions in physics, chemistry, biology, environmental and atmospheric 
science, and other areas of basic science. Their work will be critical 
to our Nation's continued leadership in the 21st century.
    I urge you to fund the WDTS program within the DOE OS at the 
President's full fiscal year 2012 budget request of $35.6 million.

               RENEWABLE ENERGY RESEARCH AND DEVELOPMENT

    Federal investment in the scientific research and technology 
development involved with renewable energy is one of the most important 
investments we can make in our Nation's future and our ability to build 
resilience to economic and environmental challenges. Renewable energy 
conveys numerous cross-cutting benefits to society, including reducing 
our dependence on foreign oil, driving innovation in the energy 
economy, decentralizing the energy market, providing new high-tech 
jobs, reducing the human toll on the environment, and improving air 
quality and public health outcomes.
    Our national research universities, along with DOE laboratories and 
an emerging private sector, are driving the country's growth in 
renewable energy and increasing the efficiency of new technologies. One 
example of such collaboration includes an expanding NCAR partnership 
with DOE's National Renewable Energy Laboratory and the regional 
utility company, Xcel Energy, to develop sophisticated wind energy 
forecasts for operational use. These provide critical information to 
select the most productive locations for new wind turbine farms, better 
integrate wind-generated electricity into the power grid, and make 
critical decisions about powering down traditional coal- and natural 
gas-fired plants when sufficient winds are predicted. To reduce the 
costs of integrating wind and solar energy into the electrical grid and 
to make renewable energy more cost effective, significant improvements 
in weather forecasting technologies are required and additional weather 
observations are needed in the lower atmosphere.
    Given the critical importance to the Nation of developing 
economically and environmentally sustainable technologies for producing 
energy, I urge the subcommittee to fully fund the fiscal year 2012 
budget request of $3.2 billion for EERE.
    I want to thank the members of the subcommittee in advance for 
supporting, through DOE, basic and cutting-edge scientific research and 
for promoting education and workforce development in the environmental 
and other Earth sciences. By doing so, you are advancing the Nation's 
economic recovery and sustaining our global scientific leadership.
                                 ______
                                 
             Prepared Statement of West Virginia University

    This testimony is submitted on behalf of West Virginia University 
on topics including fossil energy coal, oil, and natural gas research 
and development programs; Office of Electricity Programs; and new 
initiatives. In our testimony, we make the following recommendations 
for fiscal year 2012 appropriations:
  --Restore the fuels program to $20 million for coal conversion 
        research.
  --Restore the fuel cells program to $50 million.
  --Support both modeling and simulation, and experimental research 
        programs for coal systems.
  --Restore funding for oil and natural gas programs, and increase 
        budget to $80 million.
  --Do not repeal section 999 program in Energy Policy Act (EPAct) 
        2005.
  --Maintain core Coal Research Program at $404 million.
  --Initiate programs in water availability, energy security, and rare 
        earth minerals.

                              INTRODUCTION

    Both the Department of Energy (DOE) Strategic Plan and the DOE 
Quadrennial Technology Review Framing Document cite a projected long-
term dependency of our Nation on fossil fuels for electric power and 
transportation fuels. Time frames of 25 years and longer are considered 
in these projections. It is imperative that the United States place 
strategic importance on the use of our Nation's coal, oil, and natural 
gas resources to meet our energy needs. This testimony is directed 
toward key programs in coal, oil, and natural gas research.

                             FUELS PROGRAM

    Consider transportation fuels. Patrolling oil transit routes adds 
an estimated $80 billion annually to our defense costs. In 2008, we 
spent $388 billion on imported petroleum products, 57 percent of our 
balance-of-trade deficit. Production of liquid transportation fuels 
from a mixture of 60-percent coal and 40-percent biomass could provide 
3 million barrels per day of gasoline equivalent by 2020. A coal-plus-
biomass fuels program would create new jobs through increased coal 
production that could reach to upwards of 50 percent from our current 
levels. Coal-to-liquid plants located in widely dispersed geographic 
locations would support additional jobs and reduce the risks of supply 
interruptions from events such as major hurricanes in the Gulf of 
Mexico. These plants would bolster our national, energy, and economic 
security through utilizing and producing indigenous fuels. Coal-plus-
biomass fuels meet the requirements of the Energy Policy Act of 2007 
regarding their CO2 footprint, compared to conventional 
petroleum, and have been shown to be net sinks regarding CO2 
emissions (National Academy of Sciences, 2010).
    We recommend restoring funding for the fuels program to a level of 
$20 million for coal conversion research using feedstocks such as coal 
and biomass for the production of liquid transportation fuels, 
chemicals, and synthetic natural gas. Funding should be directed toward 
simulation modeling and pilot plant testing on eastern, mid-content, 
and western coals, biomass characterization and feeding, and 
transformational research to reduce the energy penalty costs of 
conversion processes and plant capital costs, which are currently a 
deterrent to building a coal fuels and chemicals industry.

                           FUEL CELLS PROGRAM

    Solid oxide fuel cells (SOFC) operating on coal-based syngas can 
form a key component of the administration's goal of having 80 percent 
of our Nation's electricity generated by clean-energy technologies. 
SOFC technology can be deployed in both central station and distributed 
generation modes. A successful collaboration of government and industry 
under the Solid State Energy Conversion Alliance (SECA) is reducing the 
cost of SOFC. The SECA fuel cell program is a critical element of 
fossil energy's technology portfolio. Integrated gasification fuel cell 
(IGFC) systems are highly efficient with near-zero atmospheric 
emissions of CO2 and air pollutants, and use minimal amounts 
of water compared to traditional pulverized coal power generation 
systems. We disagree with the administration's recommendation to defund 
the fuel cell program and recommend continuation at a level of $50 
million.

                        MODELING AND SIMULATION

    The emphasis on computational modeling in the DOE program is 
attractive for evaluating new concepts at scales ranging from molecular 
interactions through system simulations. Information gained from 
modeling will be useful in moving new concepts from scientific research 
discoveries into scalable component technologies, with added benefits 
of attendant time and cost savings afforded by performing numerous 
inexpensive computer experiments versus numerous costly laboratory 
experiments. However, experimental research is an integral part of 
modeling and simulation in that experimental data are essential for 
validating the predictions of model studies. Modeling is also useful in 
directing attention to targeted areas where further engineering 
research is needed to solve operational problems. With successful 
modeling, we can reduce development times for scaling up promising 
technologies by factors of 10-to-15, versus a more conservative scale-
up program in which the size of the system is increased by factors of 
3-to-5, for example.
    Industrial research often discovers unanticipated mechanisms in 
pilot and commercial-scale field research on actual systems that are 
not/cannot be predicted from modeling alone or laboratory-scale 
research. It is essential that the DOE Coal Program continues to 
support pilot-scale and commercial-scale experimental and demonstration 
research to allay the valid concerns of technology developers who must 
invest billions of dollars to prove the cost and performance viability 
of new systems. Close collaboration between computer modelers and 
industrial developers is recommended to ensure the effective use of 
funding in both the modeling and experimental aspects of developing and 
deploying new technologies.

                      OIL AND NATURAL GAS PROGRAMS

    We recommend restoration of the Oil and Natural Gas Programs in the 
Office of Fossil Energy at a funding level of $80 million for fiscal 
year 2012. We further recommend maintaining the program on offshore and 
unconventional onshore oil and natural gas research funded under 
section 999 of the EPAct.
    Shale Research.--National Energy Technology Laboratory (NETL)-
developed technologies for directional drilling and hydraulic 
fracturing of formations can be applied to produce the plentiful 
natural gas reserves of the Marcellus and similar shale formations. 
Much work remains to be done, however, to validate estimates of how 
much gas can be recovered, to develop the geological sciences needed to 
understand these underground reservoirs, to effectively treat produced 
water, to protect groundwater supplies, and to allay the concerns of 
residents affected by drilling and fracking operations. We recommend 
that $40 million be directed to shale gas research programs and to 
related technology transfer programs to provide information on 
environmentally safe drilling practices. The Utica shale formation is 
also a national resource for which little is known and research on this 
formation is also recommended. With the administration's focus on using 
natural gas for transportation fuels in addition to current markets for 
chemicals production and home applications, it is necessary to ensure 
adequate supplies of natural gas since existing wells will deplete at 
approximately the same rate that Marcellus shale production is 
increasing, according to Environmental Protection Agency projections.
    Oil Research.--Funding of $25 million is recommended for advanced 
oil research to support programs such as the large-scale storage of 
carbon dioxide in enhanced oil recovery applications, and the 
development of new resources such as the Baaken shale and similar 
formations that are now commercially viable, which is accredited to the 
new drilling technologies. Research should be directed toward pilot 
tests, noncore studies, and advanced research and development for next-
generation technologies.
    Methane Hydrates Research.--The remaining $15 million in our 
recommendation should be directed toward continuation of the methane 
hydrates program within the Office of Fossil Energy. This resource is 
extensive and will provide a needed supplement to our natural gas 
resource base if it can be successfully developed.
    Section 999 Program.--DOE Secretary Chu recently met with the 
Federal Advisory Committee Act committee providing guidance to the 
section 999 Offshore and Unconventional research program funded by 
royalties from offshore production of oil and natural gas. He asked 
that the program direct some of its activities to ensuring the safety 
of offshore drilling operations to avoid events such as the Macondo 
well accident of the past year. The section 999 program also provides 
support for small operators by funding collaborative research with 
national universities and for technology transfer programs. The past 
and present administrations have recommended that this program be 
repealed. We request support of the subcommittee in not repealing this 
program, especially in view of the need for increased safety in 
offshore drilling operations.

            CORE FOSSIL ENERGY SCIENTIFIC RESEARCH PROGRAMS

    The United States needs a strong core program of scientific 
research in fossil fuels. We recommend maintaining the core Coal 
Research Program at $404 million annually in addition to supporting the 
oil and natural gas program at the $80 million level discussed above.
    Fossil fuels are mainstays of our national energy demand for the 
foreseeable future. Our economic prosperity and national security are 
linked through investment in scientific research. More than one-half of 
our economic growth since World War II can be traced to science-driven 
technological innovation. Today's investments in fossil energy research 
will lead to tomorrow's discoveries that will build a better America.
    NETL, as a fossil energy field laboratory, has a long history of 
support for external entities such as industry and universities. As a 
national laboratory, NETL must also increase its level of program 
support for onsite scientific research. Significant past 
accomplishments include the drilling technologies described above and 
materials developed to reduce criteria pollutants from coal-based power 
systems. Present activities include developing excellence as a 
computational modeling and simulation center and serving as a regional 
engine for economic development through programs with local 
universities to stimulate advanced research that leads to spin-off 
industries under programs such as the Regional University Alliance 
(RUA). Within the funds provided, NETL should be encouraged to continue 
these scientific research and economic development programs.
    Core research programs should be expanded through the designation 
of additional funding to include an enhanced focus on water-related 
issues. Ground water contamination from Marcellus shale production can 
be addressed under the Oil and Natural Gas Programs described above. 
Additional funding should be identified to address a broader array of 
water issues associated with energy production. Powerplants need to 
reduce the amount of water both used and consumed in their operations. 
These needs are especially acute in areas of water shortages, such as 
the arid Western States. Production of fuels and chemicals will require 
additional water supplies. Coal conversion plants in China are 
producing liquid transportation fuels at a ratio of three barrels of 
water per barrel of fuel, a level we can attain in the United States 
through the investment of core research funds.

                            ENERGY SECURITY

    Fossil energy contributes approximately 70 percent of the 
electricity to the national grid. We recommend the programs in the 
Office of Electricity Delivery and Energy Reliability (OE) include 
components addressing the role of fossil energy in maintaining energy 
supply. Analytical tools should be developed to monitor energy supply 
and reduce risks from upsets in the fuel supply chain and energy 
production infrastructure. The role of the Office of Fossil Energy in 
the Future Smart Grid should be integrated into planning and analysis 
activities. Programs currently at NETL in areas such as energy 
efficiency of appliances can be used as a base to develop the next 
generation of ``smart grid ready'' appliances. We recommend an 
enhancement of the Office of Fossil Energy's role in energy security 
areas, given its expertise in these areas.

                              RARE EARTHS

    Advanced materials will increasingly rely on rare earth elements. 
The Office of Fossil Energy has a long history of extraction expertise, 
tracing back from its origins as a part of the U.S. Bureau of Mines, 
and its work in coal cleaning and advanced separations technology that 
can be applied to helping ensure a supply of rare earth minerals 
through improved recovery and processing technologies. We recommend 
that the DOE engage the Office of Fossil Energy in programs to maintain 
our supply of rare earth elements.
                                 ______
                                 
    Prepared Statement of Wilkes University, College of Science and 
                              Engineering

    I am writing to provide support and a recommendation for the 
Subcommittee on Energy and Water Development to fund a Department of 
Energy (DOE) research program on Potential Impacts of Hydraulic 
Fracturing and Shale Gas Development on Drinking Water Resources and 
Environmental Systems (e.g., streams and rivers). I am an aquatic 
ecologist and Dean of the College of Science and Engineering at Wilkes 
University (Wilkes-Barre, Pennsylvania). In the interest of 
transparency, I also need to point out that I am a principal 
investigator on a 1-year water quality research project with DOE 
National Energy Technology Laboratory (NETL), Morgantown, West 
Virginia, at will be addressing short-term (1 year) concerns regarding 
surface water quality, watersheds, and aquatic ecology relative to 
selected sites and Marcellus gas development in northeastern and 
northcentral Pennsylvania; our project will also provide information 
based on the best science to the people in the region.
    It should be noted that I am not opposed to shale gas development 
in Pennsylvania (or elsewhere), but do believe this development needs 
to proceed with the necessary protection of public health and 
environmental safeguards for natural resources that are important to 
the State economy and quality of life (hunting, fishing, boating and 
canoeing, recreational use of natural areas, tourism, etc.). These 
safeguards of environment and public health must be based on good 
science (i.e., research that is sorely needed at present), 
comprehensive scientific data relative to regionally unique geology, 
ecology, and hydrology, and best engineering and industrial operations 
and practices by the energy companies.
    It has been my impression over the past year as a participant in 
various meetings, conferences, coordination with DOE, and exchanges 
with energy representatives that some of the leaders in energy 
development (e.g., Range Resources and Chesapeake Energy) are trying to 
implement best operational and engineering practices. Nevertheless, an 
independent research program by Federal agencies such as DOE is 
necessary for evaluating the outcome and appropriateness of these 
practices. Energy companies, concerned with community issues of safe 
drinking water and protection of aquatic resources, may be operating 
with good intentions, but there is no comprehensive research effort by 
a Federal agency to test and evaluate proposed best industrial 
practices (e.g., centralizing water reuse facilities, testing private 
drinking water wells beyond current regulations, providing equipment 
for environmental monitoring of water quality) on their actual 
effectiveness to protect human and environmental health. In short, 
there is little to no impartial, science-based validation of proposed 
best practices before they are widely implemented.
    I wish to make the following points in my testimony:
  --the important role that DOE must play in such a research program;
  --the need for new research on shale gas development due to the 
        unique geology and hydrology of the Appalachian region (i.e., 
        methods developed for Texas and Alaska do not necessarily apply 
        in Pennsylvania or New York);
  --relationship of DOE research to Environmental Protection Agency's 
        (EPA) research plan on hydraulic fracturing and drinking water 
        alone; and
  --the benefits of a broad-based research program to gain public 
        acceptance, avoid lawsuits and extreme costs of clean-up, and 
        avoid wide-scale public rejection.
role and relevance of a department of energy research program for shale 

                            GAS DEVELOPMENT

    The DOE National Laboratory System (including NETL) is ideally 
suited to address issues of public health and environmental integrity 
of natural resources from a holistic perspective. DOE is the primary 
Federal agency conducting research on technology to support commercial 
development of energy resources and is charged with promoting the 
energy security needs of our country. Almost all of the DOE national 
labs have a unique capability for environmental research. Before coming 
to Wilkes University in 1991, I spent 7 years as an environmental 
research scientist at DOE's Idaho National Engineering Laboratory (with 
EG&G Idaho, the prime contractor) and over a 2-year period, I was a 
research data facilitator for seven national labs from coast to coast. 
I am familiar with this research mission of the DOE national labs and 
know that its current research budget for the environmental aspects and 
potential impacts from shale gas development is very limited. The 
advantage that DOE has is its interdisciplinary approach to energy 
research, cost effectively matching technology with best engineering 
practice, to best protect human health and environmental integrity.

         UNIQUE GEOLOGY AND HYDROLOGY OF THE APPALACHIAN REGION

    Hydraulic fracturing for shale gas is not a new technology and it 
has been used in other regions of the United States. However, the 
geology and hydrology of the Appalachian region of the Marcellus Play 
differs considerably from these other regions (e.g., Texas, Oklahoma, 
and Alaska) where hydrofracing has been implemented with considerably 
less public concern about human health and the environment. Based on 
the experience of Wilkes University faculty geologists and hydrologists 
in northeastern Pennsylvania, our region is extremely variable and 
complex in its geology and groundwater hydrology. There are localized 
faults and fractures in various geologic and hydrologic structures that 
can affect quality of water supply even without the disruptive effects 
of drilling. In addition, Pennsylvania has one of the highest rural 
populations in the United States and many people rely on private 
drinking water wells. Furthermore, there are no State standards for 
casing and most private wells in Pennsylvania do not have casing, or at 
best have inadequate casing. Only good data, designed to ask the 
appropriate research questions, will avoid the ensuing problems of this 
unusual but critical set of circumstances:
  --local and regional faults and fractures in various geologic strata;
  --complex geology and hydrology;
  --high rural populations; and
  --lack of standards on well casings.
    Without an organized Federal research program in this regard, the 
public outcry and resistance will only increase. Clean-up costs where 
obvious accidents may occur could be enormous. An ounce of prevention 
(good research and data on the effectiveness of best practices) is 
worth a pound of cure.

      RELATIONSHIP OF THE DEPARTMENT OF ENERGY'S RESEARCH TO THE 
            ENVIRONMENTAL PROTECTION AGENCY'S RESEARCH PLAN

    At this time, it appears that the Congress has provided some modest 
research funds for EPA's Draft Hydraulic Fracturing Study Plan that was 
posted for peer review by its (http://water.epa.gov/type/groundwater/
uic/class2/hydraulicfracturing/index.cfm) Science Advisory Board on 
February 8, 2011. While this plan is a good start, it is inadequately 
funded for research and monitoring over the necessary longer time 
period of gas development, and it is focused totally on drinking water. 
Also, EPA is a regulatory agency, and its research will take that 
direction. In contrast, if funding is available (i.e., via this 
Subcommittee on Energy and Water Development) to DOE, then this 
agency's unique interdisciplinary mix of technological research with 
outstanding research expertise in environmental and ecological systems 
would complement EPA's expertise and regulatory focus. In short, DOE is 
well-positioned to support both technological advances and improvements 
to gas development and to assess its performance and outcome for 
effectiveness with research on critical environmental and ecological 
endpoints.

         BENEFITS OF A SHALE GAS RESEARCH PROGRAM TO THE PUBLIC

    Recent articles in the New York Times and the Philadelphia Enquirer 
highlight the growing distrust of the public regarding public health 
and protection of natural resources--for example see: (http://
www.nytimes.com/2011/02/27/us/27gas.html?_r=1&ref=us) and (http://
www.philly.com/philly/news/20110403_Shale-
gas_regulation_near_river_divides_Pa_.html?viewAll=y&c=y), 
respectively. In some cases, public reaction amounts to fear of the 
unknown; in other cases, significant environmental or public health 
concerns are real and valid. Nevertheless, the concern by the public 
(and the scientific community) can only be addressed by an adequate 
research program aimed at an integrated approach to groundwater 
concerns (including drinking water wells), and the ecological health of 
streams and rivers, and natural areas (e.g., issues with forest and 
wildlife habitat fragmentation). The DOE national laboratory system is 
well suited to take on this challenge in an effective fashion and work 
with other Federal agencies in a collaborative fashion.

                             RECOMMENDATION

    For these reasons, I strongly recommend that the Subcommittee on 
Energy and Water Development fund critically needed DOE research to 
help ensure public health and to safeguard environmental and ecological 
resources. A minimum DOE research budget of $10 million a year for at 
least 5 years is recommended. Thank you for considering my testimony.

                       DEPARTMENT OF THE INTERIOR

                         Bureau of Reclamation

         Prepared Statement of the APS Four Corners Power Plant

    Dear Chairman Feinstein and Senator Alexander: I am writing to 
request your support for continued funding in fiscal year 2012 for the 
Upper Colorado River Endangered Fish Recovery Program and the San Juan 
River Basin Recovery Implementation Program as authorized by Public Law 
106-392. These two successful ongoing cooperative partnership programs 
involve the States of Colorado, New Mexico, Utah, and Wyoming, Indian 
tribes, Federal agencies and water, power, and environmental interests. 
I request your support for an appropriation for fiscal year 2012 of 
$6,248,000 to the Bureau of Reclamation (BOR) within the budget line 
item entitled ``Endangered Species Recovery Implementation Program'' 
for the Upper Colorado Region, consistent with the President's 
recommended budget. Substantial non-Federal cost-sharing funding is 
occurring pursuant to Public Law 106-392, as amended.
    The requested Federal appropriations are critically important to 
these efforts moving forward. The past support of your subcommittee has 
greatly facilitated the success of these multi-State, multi-agency 
programs. I thank you for the subcommittee's past support and request 
the subcommittee's assistance for fiscal year 2012 funding to ensure 
BOR's continuing financial participation in these vitally important 
programs.
                                 ______
                                 
                   Prepared Statement of Aurora Water

    Dear Chairman Feinstein and Senator Alexander: I am writing to 
request your support for continued funding in fiscal year 2012 for the 
Upper Colorado River Endangered Fish Recovery Program and the San Juan 
River Basin Recovery Implementation Program as authorized by Public Law 
106-392. These two successful ongoing cooperative partnership programs 
involve the States of Colorado, New Mexico, Utah and Wyoming, Indian 
tribes, Federal agencies and water, power and environmental interests. 
I request your support for an appropriation for fiscal year 2012 of 
$6,248,000 to the Bureau of Reclamation (BOR) within the budget line 
item entitled ``Endangered Species Recovery Implementation Program'' 
for the Upper Colorado Region, consistent with the President's 
recommended budget. Substantial non-Federal cost-sharing funding is 
occurring pursuant to Public Law 106-392, as amended.
    The requested Federal appropriations are critically important to 
these efforts moving forward. The past support of your subcommittee has 
greatly facilitated the success of these multi-State, multi-agency 
programs. I thank you for the subcommittee's past support and request 
the subcommittee's assistance for fiscal year 2012 funding to ensure 
BOR's continuing financial participation in these vitally important 
programs.
                                 ______
                                 
           Prepared Statement of the BHP Navajo Coal Company

    Dear Chairman Feinstein and Senator Alexander: I am writing to 
request your support for continued funding in fiscal year 2012 for the 
Upper Colorado River Endangered Fish Recovery Program and the San Juan 
River Basin Recovery Implementation Program as authorized by Public Law 
106-392. These two successful ongoing cooperative partnership programs 
involve the States of Colorado, New Mexico, Utah, and Wyoming, Indian 
tribes, Federal agencies and water, power and environmental interests. 
I request your support for an appropriation for fiscal year 2012 of 
$6,248,000 to the Bureau of Reclamation (BOR) within the budget line 
item entitled ``Endangered Species Recovery Implementation Program'' 
for the Upper Colorado Region, consistent with the President's 
recommended budget. Substantial non-Federal cost-sharing funding is 
occurring pursuant to Public Law 106-392, as amended.
    The requested Federal appropriations are critically important to 
these efforts moving forward. The past support of your subcommittee has 
greatly facilitated the success of these multi-State, multi-agency 
programs. I thank you for the subcommittee's past support and request 
the subcommittee's assistance for fiscal year 2012 funding to ensure 
the BOR's continuing financial participation in these vitally important 
programs.
                                 ______
                                 
   Prepared Statement of the Central Utah Water Conservancy District

    Dear Chairman Feinstein and Senator Alexander: I am writing to 
request your support for continued funding in fiscal year 2012 for the 
Upper Colorado River Endangered Fish Recovery Program and the San Juan 
River Basin Recovery Implementation Program as authorized by Public Law 
106-392. These two successful ongoing cooperative partnership programs 
involve the States of Colorado, New Mexico, Utah, and Wyoming, Indian 
tribes, Federal agencies and water, power, and environmental interests. 
I request your support for an appropriation for fiscal year 2012 of 
$6,248,000 to the Bureau of Reclamation (BOR) within the budget line 
item entitled ``Endangered Species Recovery Implementation Program'' 
for the Upper Colorado Region, consistent with the President's 
recommended budget. Substantial non-Federal cost-sharing funding is 
occurring pursuant to Public Law 106-392, as amended.
    The requested Federal appropriations are critically important to 
these efforts moving forward. The past support of your subcommittee has 
greatly facilitated the success of these multi-State, multi-agency 
programs. I thank you for the subcommittee's past support and request 
the subcommittee's assistance for fiscal year 2012 funding to ensure 
BOR's continuing financial participation in these vitally important 
programs.
                                 ______
                                 
              Prepared Statement of the City of Farmington

    Dear Chairman Feinstein and Senator Alexander: I am writing to 
request your support for continued funding in fiscal year 2012 for the 
Upper Colorado River Endangered Fish Recovery Program and the San Juan 
River Basin Recovery Implementation Program as authorized by Public Law 
106-392. These two successful ongoing cooperative partnership programs 
involve the States of Colorado, New Mexico, Utah, and Wyoming, Indian 
tribes, Federal agencies and water, power, and environmental interests. 
I request your support for an appropriation for fiscal year 2012 of 
$6,248,000 to the Bureau of Reclamation (BOR) within the budget line 
item entitled ``Endangered Species Recovery Implementation Program'' 
for the Upper Colorado Region, consistent with the President's 
recommended budget. Substantial non-Federal cost-sharing funding is 
occurring pursuant to Public Law 106-392, as amended.
    The requested Federal appropriations are critically important to 
these efforts moving forward. The past support of your subcommittee has 
greatly facilitated the success of these multi-State, multi-agency 
programs. I thank you for the subcommittee's past support and request 
the subcommittee's assistance for fiscal year 2012 funding to ensure 
BOR's continuing financial participation in these vitally important 
programs.
                                 ______
                                 
 Prepared Statement of the Colorado River Basin Salinity Control Forum

    This testimony is in support of funding for the title II Colorado 
River Basin Salinity Control Program. The Congress has designated the 
Department of the Interior, Bureau of Reclamation (BOR), to be the lead 
agency for salinity control in the Colorado River Basin. This role and 
the authorized program were refined and confirmed by the Congress when 
Public Law 104-20 was enacted. A total of $17,500,000 is requested for 
fiscal year 2012 to implement the needed and authorized program. 
Failure to appropriate these funds will result in significant economic 
damage in the United States and Mexico.
    In recent years, the President's requests have dropped to below $10 
million. The Colorado River Basin Salinity Control Forum (Forum) finds 
this unacceptable. BOR has requests for funding of many very cost-
effective proposals through its Basinwide Program that far exceed this 
funding level. In the judgment of the Forum, this amount is 
inappropriately low. Water quality commitments to downstream United 
States and Mexican water users must be honored while the Basin States 
continue to develop their Colorado River Compact-apportioned waters. 
Concentrations of salts in the river cause about $353 million in 
quantified damage in the United States with significantly greater 
unquantified damages. Damages occur from:
  --A reduction in the yield of salt-sensitive crops and increased 
        water use for leaching in the agricultural sector;
  --A reduction in the useful life of galvanized water pipe systems, 
        water heaters, faucets, garbage disposals, clothes washers, and 
        dishwashers, and increased use of bottled water and water 
        softeners in the household sector;
  --An increase in the use of water for cooling, and the cost of water 
        softening, and a decrease in equipment service life in the 
        commercial sector;
  --An increase in the use of water and the cost of water treatment, 
        and an increase in sewer fees in the industrial sector;
  --A decrease in the life of treatment facilities and pipelines in the 
        utility sector;
  --Difficulty in meeting wastewater discharge requirements to comply 
        with National Pollutant Discharge Elimination System permit 
        terms and conditions, and an increase in desalination and brine 
        disposal costs due to accumulation of salts in groundwater 
        basins; and
  --Increased use of imported water for leaching and the cost of 
        desalination and brine disposal for recycled water.
    The Forum, therefore, believes implementation of the program needs 
to be accelerated to a level beyond that requested by the President in 
the past.
    The program authorized by the Congress in 1995 has proven to be 
very successful and very cost effective. Proposals from the public and 
private sector to implement salinity control strategies have far 
exceeded the available funding and BOR has a backlog of proposals. BOR 
continues to select the best and most cost-effective proposals. Funds 
are available for the Colorado River Basin States' cost sharing for the 
level of Federal funding requested by the Forum. Water quality 
improvements accomplished under title II of the Colorado River Basin 
Salinity Control Act also benefit the quality of water delivered to 
Mexico. Although the United States has always met the commitments of 
the International Boundary and Water Commission's (Commission) Minute 
No. 242 to Mexico with respect to water quality, the United States 
section of the Commission is currently addressing Mexico's request for 
better water quality at the International Boundary.
    Some of the most cost-effective salinity control opportunities 
occur when BOR can improve irrigation delivery systems at the same time 
that the U.S. Department of Agriculture's (USDA) program is working 
with landowners (irrigators) to improve the on-farm irrigation systems. 
Through the USDA Environmental Quality Incentives Program, adequate on-
farm funds appear to be available and adequate BOR funds are needed to 
maximize the effectiveness of the effort. These salinity control 
efforts have secondary water conservation benefits at the point of use 
and downstream at other points of use.

                                OVERVIEW

    In 2000, the Congress reviewed the program as authorized in 1995. 
Following hearings, and with administration support, the Congress 
passed legislation that increased the ceiling authorized for this 
program by $100 million. BOR has received cost-effective proposals to 
move the program ahead and the Basin States have funds available to 
cost-share up-front.
    The Colorado River Basin Salinity Control Program was originally 
authorized by the Congress in 1974. The title I portion of the Colorado 
River Basin Salinity Control Act responded to commitments that the 
United States made, through Minute No. 242, to Mexico concerning the 
quality of water being delivered to Mexico below Imperial Dam. Title II 
of the act established a program to respond to salinity control needs 
of Colorado River water users in the United States and to comply with 
the mandates of the then newly legislated Clean Water Act. Initially, 
the Secretary of the Interior and BOR were given the lead Federal role 
by the Congress. This testimony is in support of adequate funding for 
the title II program.
    After a decade of investigative and implementation efforts, the 
Basin States concluded that the Salinity Control Act needed to be 
amended. The Congress revised the act in 1984. That revision, while 
leaving implementation of the salinity control policy with the 
Secretary of the Interior, also gave new salinity control 
responsibilities to the USDA and to the Bureau of Land Management 
(BLM). The Congress has charged the administration with implementing 
the most cost-effective program practicable (measured in dollars per 
ton of salt removed). The Basin States are strongly supportive of that 
concept as the Basin States cost share 30 percent of Federal 
expenditures up-front for the salinity control program, in addition to 
proceeding to implement salinity control activities for which they are 
responsible in the Colorado River Basin.
    The Forum is composed of gubernatorial appointees from Arizona, 
California, Colorado, Nevada, New Mexico, Utah, and Wyoming. The Forum 
has become the seven-state coordinating body for interfacing with 
Federal agencies and the Congress to support the implementation of the 
program necessary to control the salinity of the river system. In close 
cooperation with the Environmental Protection Agency (EPA) and pursuant 
to requirements of the Clean Water Act, every 3 years the Forum 
prepares a formal report analyzing the salinity of the Colorado River, 
anticipated future salinity, and the program elements necessary to keep 
the salinities at or below the concentrations in the river system in 
1972 at Imperial Dam, and below Parker and Hoover Dams.
    In setting water quality standards for the Colorado River system, 
the salinity concentrations at these three locations have been 
identified as the numeric criteria. The plan necessary for controlling 
salinity and reducing downstream damages has been captioned the ``Plan 
of Implementation.'' The 2008 Review of water quality standards 
includes an updated Plan of Implementation. The level of appropriation 
requested in this testimony is in keeping with the agreed-upon plan. If 
adequate funds are not appropriated, significant damages from the 
higher salt concentrations in the water will be more widespread in the 
United States and Mexico.

                             JUSTIFICATION

    The $17,500,000 requested by the Forum on behalf of the seven 
Colorado River Basin States is the level of funding necessary to 
proceed with BOR's portion of the Plan of Implementation. In July 1995, 
the Congress amended the Colorado River Basin Salinity Control Act. The 
amended act gives BOR new latitude and flexibility in seeking the most 
cost-effective salinity control opportunities, and it provides for 
utilization of proposals from project proponents, as well as more 
involvement from the private as well as the public sector. The result 
is that salt loading is being prevented at costs often less than one-
half the cost under the previous program. The Congress recommitted its 
support for the revised program when it enacted Public Law 106-459. The 
Basin States' cost sharing up-front adds 43 cents for every Federal 
dollar appropriated. The federally chartered Colorado River Basin 
Salinity Control Advisory Council, created by the Congress in the 
Salinity Control Act, has met and formally supports the requested level 
of funding. The Basin States urge the Energy and Water Development 
Subcommittee to support the funding as set forth in this testimony.

                     ADDITIONAL SUPPORT OF FUNDING

    In addition to the funding identified above for the implementation 
of the most recently authorized program, the Forum urges the Congress 
to appropriate funds requested by the administration to continue to 
maintain and operate salinity control facilities as they are completed 
and placed into long-term operation. Reclamation has completed the 
Paradox Valley unit which involves the collection of brines in the 
Paradox Valley of Colorado and the injection of those brines into a 
deep aquifer through an injection well. However, the only means of 
disposing of the brine collected is this injection well. This well has 
a limited life expectancy. Funds are needed now to allow for planning 
of alternatives as the end of the life expectancy of this injection 
well is approached. The continued operation of this project and the 
Grand Valley Unit will be funded primarily through the Facility 
Operations activity.
    The Forum also supports funding to allow for continued general 
investigation of the Salinity Control Program as requested by the 
administration for the Colorado River Water Quality Improvement 
Program. It is important that Reclamation have planning staff in place, 
properly funded, so that the progress of the program can be analyzed, 
coordination between various Federal and State agencies can be 
accomplished, and future projects and opportunities to control salinity 
can be properly planned to maintain the water quality standards for 
salinity so that the Basin States can continue to develop their 
Colorado River Compact-apportioned waters.
                                 ______
                                 
           Prepared Statement of the Colorado River District

    Dear Chairman Feinstein and Senator Alexander: I am writing to 
request your support for continued funding in fiscal year 2012 for the 
Upper Colorado River Endangered Fish Recovery Program and the San Juan 
River Basin Recovery Implementation Program as authorized by Public Law 
106-392. These two successful ongoing cooperative partnership programs 
involve the States of Colorado, New Mexico, Utah and Wyoming, Indian 
tribes, Federal agencies and water, power and environmental interests. 
I request your support for an appropriation for fiscal year 2012 of 
$6,248,000 to the Bureau of Reclamation (BOR) within the budget line 
item entitled ``Endangered Species Recovery Implementation Program'' 
for the Upper Colorado Region, consistent with the President's 
recommended budget. Substantial non-Federal cost-sharing funding is 
occurring pursuant to Public Law 106-392, as amended.
    The requested Federal appropriations are critically important to 
these efforts moving forward. The past support of your subcommittee has 
greatly facilitated the success of these multi-State, multi-agency 
programs. I thank you for the subcommittee's past support and request 
the subcommittee's assistance for fiscal year 2012 funding to ensure 
BOR's continuing financial participation in these vitally important 
programs.
                                 ______
                                 
           Prepared Statement of the Colorado Water Congress

    Dear Chairman Feinstein and Senator Alexander: I am writing to 
request your support for continued funding in fiscal year 2012 for the 
Upper Colorado River Endangered Fish Recovery Program and the San Juan 
River Basin Recovery Implementation Program as authorized by Public Law 
106-392. These two successful ongoing cooperative partnership programs 
involve the States of Colorado, New Mexico, Utah and Wyoming, Indian 
tribes, Federal agencies and water, power, and environmental interests. 
I request your support for an appropriation for fiscal year 2012 of 
$6,248,000 to the Bureau of Reclamation (BOR) within the budget line 
item entitled ``Endangered Species Recovery Implementation Program'' 
for the Upper Colorado Region, consistent with the President's 
recommended budget. Substantial non-Federal cost-sharing funding is 
occurring pursuant to Public Law 106-392, as amended.
    The requested Federal appropriations are critically important to 
these efforts moving forward. The past support of your subcommittee has 
greatly facilitated the success of these multi-State, multi-agency 
programs. I thank you for the subcommittee's past support and request 
the subcommittee's assistance for fiscal year 2012 funding to ensure 
BOR's continuing financial participation in these vitally important 
programs.
                                 ______
                                 
                   Prepared Statement of Denver Water

    Dear Chairman Feinstein and Senator Alexander: On behalf of Denver 
Water, I am writing to request your support for continued funding in 
fiscal year 2012 for the Upper Colorado River Endangered Fish Recovery 
Program and the San Juan River Basin Recovery Implementation Program as 
authorized by Public Law 106-392. These two successful ongoing 
cooperative partnership programs involve the States of Colorado, New 
Mexico, Utah, and Wyoming, Indian tribes, Federal agencies and water, 
power, and environmental interests. I request your support for an 
appropriation for fiscal year 2012 of $6,248,000 to the Bureau of 
Reclamation (BOR) within the budget line item entitled ``Endangered 
Species Recovery Implementation Program'' for the Upper Colorado 
Region, consistent with the President's recommended budget. Substantial 
non-Federal cost-sharing funding is occurring pursuant to Public Law 
106-392, as amended.
    The requested Federal appropriations are critically important to 
these efforts moving forward. The past support of your subcommittee has 
greatly facilitated the success of these multi-State, multi-agency 
programs. I thank you for the subcommittee's past support and request 
the subcommittee's assistance for fiscal year 2012 funding to ensure 
BOR's continuing financial participation in these vitally important 
programs.
                                 ______
                                 
      Prepared Statement of the Dolores Water Conservancy District

    Dear Chairman Feinstein and Senator Alexander: I am writing to 
request your support for continued funding in fiscal year 2012 for the 
Upper Colorado River Endangered Fish Recovery Program and the San Juan 
River Basin Recovery Implementation Program as authorized by Public Law 
106-392. These two successful ongoing cooperative partnership programs 
involve the States of Colorado, New Mexico, Utah, and Wyoming, Indian 
tribes, Federal agencies and water, power, and environmental interests. 
I request your support for an appropriation for fiscal year 2012 of 
$6,248,000 to the Bureau of Reclamation (BOR) within the budget line 
item entitled ``Endangered Species Recovery Implementation Program'' 
for the Upper Colorado Region, consistent with the President's 
recommended budget. Substantial non-Federal cost-sharing funding is 
occurring pursuant to Public Law 106-392, as amended.
    The requested Federal appropriations are critically important to 
these efforts moving forward. The past support of your subcommittee has 
greatly facilitated the success of these multi-State, multi-agency 
programs. I thank you for the subcommittee's past support and request 
the subcommittee's assistance for fiscal year 2012 funding to ensure 
BOR's continuing financial participation in these vitally important 
programs.
                                 ______
                                 
     Prepared Statement of the Grand Valley Water Users Association

    Dear Chairman Feinstein and Senator Alexander: I am writing to 
request your support for continued funding in fiscal year 2012 for the 
Upper Colorado River Endangered Fish Recovery Program and the San Juan 
River Basin Recovery Implementation Program as authorized by Public Law 
106-392. These two successful ongoing cooperative partnership programs 
involve the States of Colorado, New Mexico, Utah, and Wyoming, Indian 
tribes, Federal agencies and water, power, and environmental interests. 
I request your support for an appropriation for fiscal year 2012 of 
$6,248,000 to the Bureau of Reclamation (BOR) within the budget line 
item entitled ``Endangered Species Recovery Implementation Program'' 
for the Upper Colorado Region, consistent with the President's 
recommended budget. Substantial non-Federal cost-sharing funding is 
occurring pursuant to Public Law 106-392, as amended.
    The requested Federal appropriations are critically important to 
these efforts moving forward. The past support of your subcommittee has 
greatly facilitated the success of these multi-State, multi-agency 
programs. I thank you for the subcommittee's past support and request 
the subcommittee's assistance for fiscal year 2012 funding to ensure 
BOR's continuing financial participation in these vitally important 
programs.
                                 ______
                                 
           Prepared Statement of the Jicarilla Apache Nation

    Dear Chairman Feinstein and Senator Alexander: On behalf of the 
Jicarilla Apache Nation, I am writing to request your support for 
continued funding in fiscal year 2012 for the Upper Colorado River 
Endangered Fish Recovery Program and the San Juan River Basin Recovery 
Implementation Program as authorized by Public Law 106-392. These two 
successful ongoing cooperative partnership programs involve the States 
of Colorado, New Mexico, Utah and Wyoming, Indian tribes, Federal 
agencies and water, power and environmental interests. Jicarilla Apache 
Nation has been a participant in the San Juan River Basin Recovery 
Implementation Program since its inception in 1992, and I want to 
stress that the continuation of the Program is of the utmost importance 
to the Nation and the economic viability of the region. Therefore, I 
request your support for an appropriation for fiscal year 2012 of 
$6,248,000 to the Bureau of Reclamation (BOR) within the budget line 
item entitled ``Endangered Species Recovery Implementation Program'' 
for the Upper Colorado Region, consistent with the President's 
recommended budget. Substantial non-Federal cost-sharing funding is 
occurring pursuant to Public Law 106-392, as amended.
    The requested Federal appropriations are critically important to 
these efforts moving forward. The past support of your subcommittee has 
greatly facilitated the success of these multi-State, multi-agency 
programs. I thank you for the subcommittee's past support and request 
the subcommittee's assistance for fiscal year 2012 funding to ensure 
BOR's continuing financial participation in these vitally important 
programs.
                                 ______
                                 
Prepared Statements of the Lower Brule Rural Water System; Oglala Sioux 
  Rural Water Supply System; Rosebud Rural Water System; and the West 
                  River/Lyman Jones Rural Water System

                        FISCAL YEAR 2012 REQUEST

    The Mni Wiconi Project beneficiaries respectfully request $26.238 
million in appropriations for construction and $11.754 million for 
operation and maintenance (OMR) activities for fiscal year 2012, a 
total request of $37.992 million:

                     FISCAL YEAR 2012 TOTAL REQUEST
------------------------------------------------------------------------
                                                              Amount
------------------------------------------------------------------------
Construction............................................     $26,238,000
OMR.....................................................      11,754,000
                                                         ---------------
      Total.............................................      37,992,000
------------------------------------------------------------------------

    The construction request includes $0.960 million for Bureau of 
Reclamation (BOR) oversight, and the operation, maintenance, and 
replacement (OMR) request includes $1.447 million for BOR oversight.

                           CONSTRUCTION FUNDS

    Construction funds would be utilized as follows:

------------------------------------------------------------------------
                                                   Construction request
                  Project area                       fiscal year 2012
------------------------------------------------------------------------
Oglala Sioux Rural Water Supply System:
    Core.......................................                  ( \1\ )
    Distribution...............................              $10,848,000
West River/Lyman-Jones Rural Water Supply......                5,475,000
Rosebud Rural Water Supply.....................                9,915,000
                                                ------------------------
      Total....................................               26,238,000
------------------------------------------------------------------------
\1\ Complete.

    As shown in the table below, the project will be 89 percent 
complete at the end of fiscal year 2011. Construction funds remaining 
to be spent after fiscal year 2011 will total $49.568 million within 
the current authorization (in October 2010 dollars). Additional 
administrative and overhead costs of extending the project, additional 
construction costs, and inflation at 3.89 percent over the next 2 years 
will increase remaining project costs to $83.217 million after fiscal 
year 2011.

------------------------------------------------------------------------
 
------------------------------------------------------------------------
Total Federal construction funding (October 2010            $464,669,000
 dollars)...............................................
                                                         ===============
Estimated Federal construction funding spent through        $415,101,000
 fiscal year 2011.......................................
                                                         ===============
Percent spent through fiscal year 2011..................           89.33
                                                         ===============
Amount remaining after 2010:
    Total authorized (October 2010 dollars).............     $49,568,000
    Adjusted for extension to fiscal year 2013 and other     $78,607,000
     costs..............................................
    Adjusted for annual inflation.......................     $83,217,000
Completion fiscal year (Statutory fiscal year 2013;                 2013
 Public Law 110-161)....................................
Years to complete.......................................               2
Average annual required for fiscal year 2013 finish with     $41,609,000
 re-authorization.......................................
Average annual required for fiscal year 2013 finish          $26,238,000
 without re-authorization...............................
------------------------------------------------------------------------

    Cost indexing over the last 5 years has averaged 3.89 percent for 
pipelines, primarily due to a 7.7-percent reduction in 2009 during 
recession. The increase in pipeline costs last year was 6.17 percent. 
Pipelines are the principal components yet to be completed (see chart 
below). Assuming average 3.89-percent inflation in construction costs 
over the remaining 2 years, average funding of $26.238 million is 
required to complete the project within the existing authorization, and 
$41.609 million is required to complete the project if re-authorized to 
finish the project as planned.




    The extension of the project from 2008 to 2013 did not provide for 
budgeting of BOR oversight, administration and other ``overhead'' 
costs, which will total $27.157 million by the end of 2013. These costs 
have been and will be incurred at the expense of construction elements, 
and a $29.039 million re-authorization of the construction ceiling is 
needed to recover those overhead costs, due primarily to the slow pace 
of budgeting by the administration. The administration's budget for 
construction for fiscal year 2012 is $16 million, far less than the 
$26.238 million needed, and threatens to extend the project beyond 2013 
with continued increases in overhead costs and depletion of funds that 
would otherwise be applied to finishing construction.
    The request will create an estimated 210 full-time equivalent (FTE) 
construction jobs and 94 OMR jobs in an area of the Nation with the 
lowest per capita income and deepest poverty.
    Poverty is the harbinger of the severe healthcare crisis facing the 
Indian people in the Northern Great Plains. The present value of extra 
costs of healthcare during the lifetime of each 24,000 members of the 
Indian population in the Mni Wiconi Project is estimated at $1.12 to 
$2.25 billion (in 2010 dollars). The costs are based on extraordinarily 
high rates of mortality due to heart disease, cancer and diabetes. The 
Mni Wiconi Project has the direct effect of employing part of our 
unemployed and underemployed Indian population and creates the 
necessary infrastructure for more employment in indirect commercial and 
industrial development. This will reduce poverty, mortality and the 
national cost burden of Indian healthcare.

                 OGLALA SIOUX RURAL WATER SUPPLY SYSTEM

Core System
    The Oglala Sioux Tribe has completed the core system. The 
completion of the Oglala Sioux Rural Water Supply System (OSRWSS) core 
system was an historic milestone and permits greater focus in remaining 
years of the project on completion of the distribution systems.

Distribution System
    The Pine Ridge Indian Reservation will receive significantly more 
water from the OSRWSS core system in fiscal year 2011. Major segments 
of the main transmission system will be completed across the 
Reservation and connect many of the larger communities with safe and 
adequate drinking water. OSRWSS pipelines now deliver water from the 
Missouri River to the communities of Georgetown, Wanblee, Crazy Horse 
School, Lakota Fund Housing and Potato Creek Community and the large 
number of rural homes between the communities. The communities of 
Hisle, Kyle, Manderson, Red Shirt, Porcupine and Wounded Knee can be 
served with Missouri River water by the end of 2011.
    Fiscal year 2012 will be another historic year, but considerable 
work remains to distribute the water supply throughout the reservation. 
More than 40 percent of the project's population resides on the Pine 
Ridge Indian Reservation, and only 78 percent of the distribution 
system will be complete at the end of 2011. The reservation public 
received its first Missouri River supply in 2009 after waiting 15 years 
for construction of core facilities to the Reservation.
    Project funds in fiscal year 2012 will continue building the on-
reservation transmission system. Funding will be used for transmission 
and service line development east of Pine Ridge Village between 
Wakpamni, Batesland, and Allen and south toward the Nebraska State 
line. This area has been deferred in the past due to funding 
constraints. The supervisory control and data acquisition (SCADA) 
facilities will be installed with state-of-the-art electronic 
equipment.
    As set forth above, activity on the Pine Ridge Indian Reservation 
in fiscal year 2012 continues to focus on constructing the transmission 
system that serves as the ``backbone'' of the Project on the 
Reservation from the White River in the northeast corner of the 
Reservation to Pine Ridge Village. The tribe will continue to focus on 
the disinfection requirements to blend Missouri River water and high-
quality groundwater without creating harmful contaminants. State-of-
the-art designs are being implemented for water quality control, and 
the Project will serve as a model for other projects requiring these 
facilities.
    The Oglala Sioux Tribe is supportive of the funding request of 
other sponsors.

               WEST RIVER/LYMAN-JONES RURAL WATER SYSTEM

    West River/Lyman-Jones Rural Water System (WR/LJ RWS) projects for 
fiscal year 2012 include standby generation facilities, conversion of 
community water systems, storage reservoirs, SCADA, and cold storage 
additions.
    The upper Midwest and specifically the Mni Wiconi project area 
regularly experience power outages as the result of winter weather 
conditions. Regulatory authorities in South Dakota have recommended 
standby generation as the result of statewide power outages experienced 
during the winters of 2005-2006 and 2009-2010. BOR has concurred in the 
addition of standby generation to the Mni Wiconi plan of work. WR/LJ 
has outlined a 3-year standby generation project schedule.
    The WR/LJ project includes four areas in which area ranchers are 
served by a common well of limited capacity and unacceptable water 
quality. The construction of WR/LJ facilities to serve them as 
individual members of WR/LJ will provide the pipeline capacity and 
water quality meeting Mni Wiconi project design standards.
    Water storage needs include an elevated tower in the Reliance 
service area, a ground storage reservoir in Mellette County and 
supplemental storage in the Elbon service area.
    SCADA capability provides accurate and efficient transmission of 
data and allows remote control of pumping and storage facilities. The 
WR/LJ SCADA system will be completed using the requested funding.
    Storage facilities at the Murdo and Philip operations centers will 
complete the building components of the WR/LJ project.
    Previous Federal appropriations to the Mni Wiconi project have made 
possible the delivery of much needed quality water to members of the 
West River/Lyman-Jones RWS and to the livestock industry in the project 
area. This would not have been possible without State and Federal 
assistance.

           ROSEBUD SIOUX RURAL WATER SYSTEM--FISCAL YEAR 2012

    Funding for fiscal year 2012 will be used to complete two major 
projects begun in fiscal year 2011 and further work on the Rosebud 
Sioux Rural Water System (RSRWS or Sicangu Mni Wiconi) distribution 
system. In fiscal year 2011 work began on the water supply for the 
Rosebud Adult Correctional Facility (ACF). The ACF is a major project 
that will be constructed in 2011 and in operation in August 2012. The 
intent of locating the facility on Rosebud is that incarcerated 
individuals are closer to the family and culture and the recidivism 
rate will be lower and the local economy also benefits. The Mni Wiconi 
Project is responsible for delivering water to the ACF and providing 
adequate volumes to meet peak demands. An elevated storage tank appears 
to be the only feasible option available.
    The other major project initiated in fiscal year 2011 requiring 
fiscal year 2012 funds is the Sicangu Village Supply Project. Because 
of unexpected quality and quantity limitations of the aquifer in 
southern Todd County, high-quality surface water from OSRWSS will be 
conveyed by a transmission pipeline to a new elevated storage reservoir 
at Sicangu Village. The elevated reservoir is currently under contract 
and will be completed this summer. Sicangu Village is an expanding 
housing area and the local wells cannot meet demands of expansion. The 
transmission line and elevated reservoir will provide a reliable supply 
of high-quality water to the development corridor along Highway 83 
between Mission and Sicangu Village. It was hoped that this area of the 
Rosebud Reservation would not need to be connected to the Mni Wiconi 
Project because of the presence of the Ogallala aquifer. The estimated 
demands for the area were, however, included in system planning and it 
now appears this foresight was beneficial because portions of the 
aquifer have high nitrates and other areas are not as high yielding as 
originally thought.
    Distribution system projects will extend service to two schools in 
southern Todd County and meet domestic needs in other areas of the 
Primary Service Area (Todd and Mellette Counties). It was hoped to 
connect the Lakeview and Littleburg schools to the system in fiscal 
year 2011, but fiscal year 2011 funds are not sufficient. The wells 
that supply water to both of the schools have high nitrates. The Mni 
Wiconi Project will ensure that future generations on the Rosebud 
Reservation, both Indians and non-Indians alike, will be supplied with 
water that meets safe drinking water standards.
    The other distribution system expansion planned for 2012 is the 
completion of the East Todd Project. The initial phase of this project 
was completed by the Tribal Force Account Program in late 2009 and 
rights-of-way have now been obtained to undertake the remainder of the 
project. This project also serves an area where water quality has been 
declining due to elevated nitrate levels.
    The ongoing effort to connect rural homes to transmission and 
distribution lines will also continue in 2012. This work is undertaken 
through the Tribal Force Account Program. The Force Account Program not 
only provides a reliable source of high-quality water to rural homes, 
it also provides employment to numerous tribal members and helps 
circulate dollars on the reservation thereby stimulating the local 
economy.

                OPERATION, MAINTENANCE, AND REPLACEMENT

    The Sponsors will continue to work with BOR to ensure that their 
budgets are adequate to properly operate, maintain, and replace 
respective portions of the core and distribution systems. The Sponsors 
will also continue to manage operation, maintenance, and replacement 
expenses to ensure that the limited funds can best be balanced between 
construction and OMR. Unfortunately the administration's budget for 
fiscal year 2012 ($10.058 million) is under-stated for the first time 
in the history of the project. The project needs $11.754 million. BOR's 
budget for 2012 will cause the project to fall into a state of 
disrepair and will threaten the considerable investment of the United 
States from 1994 to date.
    The project has been treating and delivering more water each year 
from the OSRWSS Water Treatment Plant near Fort Pierre as construction 
is advanced in the Rosebud, WRLJ and Oglala service areas. Completion 
of significant core and distribution pipelines has resulted in more 
deliveries to more communities and rural users. The need for sufficient 
funds to properly operate and maintain the functioning system 
throughout the project has grown as the project has now reached 89-
percent completion. The OMR budget must be adequate to keep pace with 
the system that is placed in operation.
    The Lower Brule Rural Water System (LBRWS) is essentially complete 
with all major components such as the water treatment plant, booster 
stations, and tanks/reservoirs in full operation. As a result, LBRWS's 
operation and maintenance portion of the budget has reached a baseline 
amount to which only slight adjustments along with inflation should be 
made each year. The portion of the LBRWS OM&R budget that is somewhat 
variable is the Replacement Additions and Extraordinary (RAX) 
maintenance items. LBRWS will continue to work with BOR and the other 
sponsors to prioritize their needs and ensure that their system is 
operating to the standards that have been established over the past 
several years. With that in mind, the LBRWS request for OMR for fiscal 
year 2012 is $1,550,000.
    The RSRWS expanded significantly in 2010 and surface water now 
reaches Todd County. To accomplish this, two additional high-capacity 
pumping stations were added to the system. The new pumping stations 
increase operational costs for both energy, maintenance and personnel. 
In addition, energy costs increases have significantly impacted Rosebud 
for electrical costs and vehicle expenses. With the oldest parts of the 
system in service for 15 years replacement costs covered under RAX are 
also becoming more significant. RAX funds must be included in the Mni 
Wiconi Project appropriations because they are not funded through BOR's 
RAX program.
    OSRWSS will incur unanticipated core OMR expenses in fiscal year 
2012 to replace valves, remove sludge at the water treatment plant and 
supplement American Recovery and Reinvestment Act (ARRA) funds for 
chlorine booster stations and generators/transfer switches. The 
unanticipated costs are $661,000, which will improve facilities that 
benefit all project sponsors.
    The Mni Wiconi Project tribal beneficiaries (as listed below) 
respectfully request appropriations for OMR in fiscal year 2012 in the 
amount of $11.754 million.

                          FISCAL YEAR 2011 OMR
------------------------------------------------------------------------
                      Project area                            Request
------------------------------------------------------------------------
Oglala Sioux Rural Water Supply System:
    Core................................................      $3,380,000
    Distribution........................................       3,100,000
Lower Brule.............................................       1,550,000
Rosebud RWS.............................................       2,277,000
Reclamation.............................................       1,447,000
                                                         ---------------
      Total.............................................      11,754,000
------------------------------------------------------------------------

                          TRUST RESPONSIBILITY

    Public Law 100-516, the Mni Wiconi Project Act, provides that:

    ``. . . United States has a trust responsibility to ensure that 
adequate and safe water supplies are available to meet the economic, 
environmental, water supply, and public health needs of the . . . 
Indian Reservation[s] . . .''

    The field staff and the Regional Office of BOR have been extremely 
helpful in advancing this project, but there has been concern that BOR 
mid-managers and Office of Management and Budget (OMB) are making 
unilateral decisions that harm the trust relationship. The following 
are specific instances:
  --BOR has re-distributed funds allocated to the Oglala Sioux Tribe to 
        West River/Lyman Jones without the urging of West River/Lyman 
        Jones to further BOR performance objectives. While OSRWSS has 
        consistently carried funds over from one fiscal year to 
        another, there has never been an instance or a threat of an 
        instance of not spending funding appropriated in a given year 
        in that year or the year that follows. The rate of completion 
        of the OSRWSS project is decelerated and the rate of other 
        projects has been accelerated without the urging of recipients 
        of re-distributed funding;
  --To our complete satisfaction on construction, BOR has yielded to 
        the leadership of the Indian and non-Indian sponsors to permit 
        their collaborative development of annual construction funding 
        allocations and budgets. On the other hand, BOR has imposed its 
        structure and budget specifics in lieu of Indian leadership on 
        the formulation of annual OMR allocations and budgets;
  --OMB has budgeted funds to BOR for its Rural Water Program without 
        separation of construction and OMR accounts, and the 
        constraints on the total budget have fallen heavily on the 
        funds available to complete construction. OMR budgeting has 
        been held relatively constant with higher percentages of 
        construction completion, and construction budgeting has 
        decreased. The fixed level of OMR funding has constrained the 
        activities needed on the Indian distribution systems. The 
        construction budget is diminishing at a time when acceleration 
        of construction is needed to deliver the benefits of the 
        project to the Indian people. At a minimum, the construction 
        budget should be a priority and should be held at a level 
        needed to complete the project on the statutory schedule in 
        2013 while providing an adequate OMR budget;
  --Mid-levels managers have often view the project as a BOR project, 
        rather than as an Indian project as provided by Public Law 100-
        516, and their vision is affected.
    Improvement of the relationship and performance has been observed 
over the last year as BOR has responded to this concern.
                                 ______
                                 
   Prepared Statement of Matthew H. Mead, Governor, State of Wyoming

    Dear Chairman Feinstein and Senator Alexander: I am writing to 
request your support and assistance in insuring continued funding for 
the Upper Colorado River Endangered Fish Recovery Program and the San 
Juan River Basin Recovery Implementation Program. These two successful 
ongoing cooperative partnership programs involve the States of 
Colorado, New Mexico, Utah and Wyoming, Indian tribes, Federal agencies 
and water, power and environmental interests. Wyoming joins the other 
participating States and non-Federal partners in requesting your 
support for an appropriation for fiscal year 2012 of $6,248,000 to the 
Bureau of Reclamation (BOR) within the budget line item entitled 
``Endangered Species Recovery Implementation Program'' for the Upper 
Colorado Region. Recognizing the need for fiscal responsibility, I must 
also point out, with respect to the fish recovery programs, that it 
will cost the program participants including, Wyoming, much more in 
terms of Endangered Species Act (ESA) costs if these programs do not 
continue.
    The Upper Colorado and San Juan recovery programs are national 
models of collaborative conservation partnerships working to recover 
endangered species while meeting water use and water development 
demands in compliance with the Federal ESA, State law, and interstate 
compacts in the Intermountain West.
    Since 1988, the two programs, collectively, have provided ESA 
section 7 compliance (without litigation) for more than 2,160 Federal, 
tribal, State, and privately managed water projects depleting more than 
3.7 million acre-feet of water per year. The Department of the Interior 
recognized these programs with its nation-wide Cooperative Conservation 
Award in April 2008 as outstanding collaborative partnerships 
accomplishing substantial on-the-ground conservation results. 
Substantial non-Federal cost-sharing funding exceeding 50 percent is 
occurring pursuant to their authorization in Public Law 106-392, as 
amended.
    The requested Federal appropriations are critically important to 
these efforts moving forward. The past support of your subcommittee has 
greatly facilitated the success of these multi-State, multi-agency 
programs. On behalf of the citizens of Wyoming, I thank you for that 
support and request the subcommittee's assistance for fiscal year 2012 
funding to ensure BOR's continuing financial participation in these 
vitally important programs.
                                 ______
                                 
     Statement of the New Mexico State Engineer and the New Mexico 
                      Interstate Stream Commission

                                SUMMARY

    This statement is submitted in support of fiscal year 2012 
appropriations for the Colorado River Basin Salinity Control Program of 
the Department of the Interior's Bureau of Reclamation (BOR). The 
Congress designated BOR to be the lead agency for salinity control in 
the Colorado River Basin by the Colorado River Basin Salinity Control 
Act of 1974, and reconfirmed BOR's role by passage of Public Law 104-
20. A total of $17,500,000 is requested for fiscal year 2012 to 
implement the authorized salinity control program of BOR. Recent years 
have followed a trend of inadequate funding for the needs of the 
program. An appropriation of $17,500,000 for BOR's salinity control 
program is necessary to restore the program to the level needed to 
protect water quality standards for salinity and to prevent unnecessary 
levels of economic damage from increased salinity in water delivered to 
the Lower Basin States of the Colorado River. In addition, funding for 
operation and maintenance of existing projects and sufficient general 
investigation funding is required to identify new salinity control 
opportunities.

                               STATEMENT

    The water quality standards for salinity of the Colorado River must 
be protected while the Basin States continue to develop their compact 
apportioned waters of the river. The salinity standards for the 
Colorado River have been adopted by the seven Basin States and approved 
by the Environmental Protection Agency. While currently the standards 
have not been exceeded, salinity-control projects must be brought on-
line in a timely and cost-effective manner to prevent future effects 
that could result in unnecessary damages from higher levels of salinity 
in the water delivered to the Lower Basin States of the Colorado River.
    The Colorado River Basin Salinity Control Act was authorized by the 
Congress and signed into law in 1974. The seven Colorado River Basin 
States, in response to the Clean Water Act of 1972, formed the Colorado 
River Basin Salinity Control Forum (Forum), a body comprised of 
gubernatorial representatives from the seven States. The Forum was 
created to provide for interstate cooperation in response to the Clean 
Water Act and to provide the States with information necessary to 
comply with sections 303(a) and (b) of the act. The Forum has become 
the primary means for the Basin States to coordinate with Federal 
agencies and the Congress to support the implementation of the salinity 
control program for the Colorado River Basin.
    BOR studies show that quantified damages from the Colorado River to 
United States water users are about $353 million per year. Unquantified 
damages are significantly greater. Damages are estimated at $75 million 
per year for every additional increase of 30 milligrams per liter in 
salinity of the Colorado River. Control of salinity is necessary for 
the States of the Colorado River Basin, including New Mexico, to 
continue to develop their compact-apportioned waters of the Colorado 
River.
    Timely appropriations for the funding of the salinity control 
program are essential to comply with the water quality standards for 
salinity, prevent unnecessary economic damages in the United States, 
and protect the quality of the water that the United States is 
obligated to deliver to Mexico. The Basin States and Federal agencies 
agree that increases in the salinity of the Colorado River will result 
in significant increases in damages to water users in the Lower 
Colorado River Basin. Although the United States has always met the 
water quality standard for salinity of water delivered to Mexico under 
Minute No. 242 of the International Boundary and Water Commission 
(IBWC), the United States through the United States section of IBWC is 
currently addressing a request by Mexico for better quality water. 
Continued strong support and adequate funding of the salinity control 
program is required to control salinity-related damages in the United 
States and Mexico.
    The Congress amended the Colorado River Basin Salinity Control Act 
in July 1995 (Public Law 104-20). The salinity control program 
authorized by the Congress by the amendment has proven to be very cost-
effective, and the Basin States are standing ready with up-front cost-
sharing. Proposals from public and private sector entities in response 
to BOR's requests for proposals and funding opportunity announcements 
have far exceeded available funding appropriated in recent years. Basin 
States cost-sharing funds are available for the $17.5 million 
appropriation request for fiscal year 2012. The Basin States' cost-
sharing adds 43 cents for each Federal dollar appropriated.
    Public Law 106-459 gave BOR additional spending authority for the 
salinity control program. With the additional authority in place and 
significant cost-sharing available from the Basin States, it is 
essential that the salinity control program be funded at the level 
requested by the Forum and Basin States to protect the water quality of 
the Colorado River. Some of the most cost-effective salinity control 
opportunities occur when BOR improves irrigation delivery systems 
concurrently with on-farm irrigation improvements undertaken by the 
U.S. Department of Agriculture's Environmental Quality Incentives 
Program (EQIP). The Basin States cost-share funding is available for 
both on-farm and off-farm improvements. The EQIP funding appears to be 
adequate to accomplish the on-farm work. Adequate funding for BOR's 
off-farm work is needed to maintain timely implementation and 
effectiveness of salinity control measures.
    Maintenance and operation of BOR's salinity control projects and 
general investigations to identify new cost-effective salinity control 
projects are necessary for the continued success of the salinity 
control program. Investigation of new opportunities for salinity 
control is critical while the Basin States continue to develop and use 
their compact-apportioned waters of the Colorado River. The water-
quality standards for salinity are dependent on timely implementation 
of salinity control projects, adequate funding to maintain and operate 
existing projects, and sufficient general investigation funding to 
determine new cost-effective opportunities for salinity control.
    Continued funding primarily through BOR's Facility Operations 
activity to support maintenance and operation of the Paradox Valley 
Unit and the Grand Valley Unit is critically needed. General 
Investigation funding through BOR's Colorado River Water Quality 
Improvement Program needs to be restored to a level that supports the 
need for identification and study of new salinity control opportunities 
to maintain the levels of salinity control needed to meet water quality 
standards and control economic damages in the Lower Colorado River 
Basin.
    I urge the Congress to appropriate $17.5 million to BOR for the 
Colorado River Basin Salinity Control Program, plus adequate funding 
for operation and maintenance of existing projects and adequate funding 
for general investigations to identify new salinity control 
opportunities. Also, I fully support testimony by the Forum's Executive 
Director, Don Barnett, in request of this appropriation, and the 
recommendation of an appropriation of the same amount by the federally 
chartered Colorado River Basin Salinity Control Advisory Council.
                                 ______
                                 
 Prepared Statement of the Northern Colorado Water Conservancy District

    Dear Chairman Feinstein and Senator Alexander: On behalf of the 
Boards of Directors of the Northern Colorado Water Conservancy District 
and Municipal Subdistrict, Northern Colorado Water Conservancy 
District, I am writing to request your support for continued funding in 
fiscal year 2012 for the Upper Colorado River Endangered Fish Recovery 
Program and the San Juan River Basin Recovery Implementation Program as 
authorized by Public Law 106-392.
    These two successful, ongoing cooperative partnership programs 
involve the States of Colorado, New Mexico, Utah and Wyoming, Indian 
tribes, Federal agencies, and water, power and environmental interests. 
I request your support for an appropriation for fiscal year 2012 of 
$6,248,000 to the Bureau of Reclamation (BOR) within the budget line 
item entitled ``Endangered Species Recovery Implementation Program'' 
for the Upper Colorado Region consistent with the President's 
recommended budget. Substantial non-Federal, cost-sharing funding is 
occurring pursuant to Public Law 106-392, as amended.
    The requested Federal appropriations are critically important to 
these efforts. The past support of your subcommittee has greatly 
facilitated the success of these multi-State, multi-agency programs. I 
thank you for the subcommittee's past support and request the 
subcommittee's assistance for fiscal year 2012 funding to ensure BOR's 
continuing financial participation in these vitally important programs.
                                 ______
                                 
       Prepared Statement of the Orchard Mesa Irrigation District

    Dear Chairman Feinstein and Senator Alexander: I am writing to 
request your support for continued funding in fiscal year 2012 for the 
Upper Colorado River Endangered Fish Recovery Program and the San Juan 
River Basin Recovery Implementation Program as authorized by Public Law 
106-392. These two successful ongoing cooperative partnership programs 
involve the States of Colorado, New Mexico, Utah, and Wyoming, Indian 
tribes, Federal agencies and water, power, and environmental interests. 
I request your support for an appropriation for fiscal year 2012 of 
$6,248,000 to the Bureau of Reclamation (BOR) within the budget line 
item entitled ``Endangered Species Recovery Implementation Program'' 
for the Upper Colorado Region, consistent with the President's 
recommended budget. Substantial non-Federal cost-sharing funding is 
occurring pursuant to Public Law 106-392, as amended.
    The requested Federal appropriations are critically important to 
these efforts moving forward. The past support of your subcommittee has 
greatly facilitated the success of these multi-State, multi-agency 
programs. I thank you for the subcommittee's past support and request 
the subcommittee's assistance for fiscal year 2012 funding to ensure 
BOR's continuing financial participation in these vitally important 
programs.
                                 ______
                                 
               Prepared Statement of PNM Resources, Inc.

    Dear Chairman Feinstein and Senator Alexander: I am writing to 
request your support for continued funding in fiscal year 2012 for the 
Upper Colorado River Endangered Fish Recovery Program and the San Juan 
River Basin Recovery Implementation Program as authorized by Public Law 
106-392. These two successful ongoing cooperative partnership programs 
involve the States of Colorado, New Mexico, Utah, and Wyoming, Indian 
tribes, Federal agencies and water, power, and environmental interests. 
I request your support for an appropriation for fiscal year 2012 of 
$6,248,000 to the Bureau of Reclamation (BOR) within the budget line 
item entitled ``Endangered Species Recovery Implementation Program'' 
for the Upper Colorado Region, consistent with the President's 
recommended budget. Substantial non-Federal cost-sharing funding is 
occurring pursuant to Public Law 106-392, as amended.
    The requested Federal appropriations are critically important to 
these efforts moving forward. The past support of your subcommittee has 
greatly facilitated the success of these multi-State, multi-agency 
programs. I thank you for the subcommittee's past support and request 
the subcommittee's assistance for fiscal year 2012 funding to ensure 
BOR's continuing financial participation in these vitally important 
programs.
                                 ______
                                 
          Prepared Statement of the San Juan Water Commission

    Dear Chairman Feinstein and Senator Alexander: I am writing to 
request your support for continued funding in fiscal year 2012 for the 
Upper Colorado River Endangered Fish Recovery Program and the San Juan 
River Basin Recovery Implementation Program as authorized by Public Law 
106-392. These two successful ongoing cooperative partnership programs 
involve the States of Colorado, New Mexico, Utah and Wyoming, Indian 
tribes, Federal agencies and water, power and environmental interests. 
I request your support for an appropriation for fiscal year 2012 of 
$6,248,000 to the Bureau of Reclamation (BOR) within the budget line 
item entitled ``Endangered Species Recovery Implementation Program'' 
for the Upper Colorado Region, consistent with the President's 
recommended budget. Substantial non-Federal cost-sharing funding is 
occurring pursuant to Public Law 106-392, as amended.
    The requested Federal appropriations are critically important to 
these efforts moving forward. The past support of your subcommittee has 
greatly facilitated the success of these multi-State, multi-agency 
programs. I thank you for the subcommittee's past support and request 
the subcommittee's assistance for fiscal year 2012 funding to ensure 
BOR's continuing financial participation in these vitally important 
programs.
                                 ______
                                 
          Prepared Statement of the Southern Ute Indian Tribe

    Dear Chairman Feinstein and Senator Alexander: On behalf of the 
Southern Ute Indian Tribe, I am writing to request your support for 
continued funding in fiscal year 2012 for the Upper Colorado River 
Endangered Fish Recovery Program and the San Juan River Basin Recovery 
Implementation Program as authorized by Public Law 106-392. These two 
successful ongoing cooperative partnership programs involve the States 
of Colorado, New Mexico, Utah and Wyoming, the Southern Ute Indian 
Tribe, the Ute Mountain Ute Indian Tribe, the Navajo Nation, the 
Jicarilla Apache Nation, Federal agencies and water, power, and 
environmental interests. The tribe requests your support for an 
appropriation for fiscal year 2012 of $6,248,000 to the Bureau of 
Reclamation (BOR) within the budget line item entitled ``Endangered 
Species Recovery Implementation Program'' for the Upper Colorado 
Region, consistent with the President's recommended budget. Substantial 
non-Federal cost-sharing funding is occurring pursuant to Public Law 
106-392, as amended.
    The requested Federal appropriations are critically important to 
these efforts moving forward. The past support of your subcommittee has 
greatly facilitated the success of these multi-State, multi-agency 
programs. The tribe thanks you for the subcommittee's past support and 
requests the subcommittee's assistance for fiscal year 2012 funding to 
ensure BOR's continuing financial participation in these vitally 
important programs.
                                 ______
                                 
   Prepared Statement of the Southwestern Water Conservation District

    Dear Chairman Feinstein and Senator Alexander: We are writing to 
request your support for continued funding in fiscal year 2012 for the 
Upper Colorado River Endangered Fish Recovery Program and the San Juan 
River Basin Recovery Implementation Program as authorized by Public Law 
106-392. These two successful ongoing cooperative partnership programs 
involve the States of Colorado, New Mexico, Utah and Wyoming, Indian 
tribes, Federal agencies and water, power, and environmental interests. 
We request your support for an appropriation for fiscal year 2012 of 
$6,248,000 to the Bureau of Reclamation (BOR) within the budget line 
item entitled ``Endangered Species Recovery Implementation Program'' 
for the Upper Colorado Region, consistent with the President's 
recommended budget. Substantial non-Federal cost-sharing funding is 
occurring pursuant to Public Law 106-392, as amended.
    The requested Federal appropriations are critically important to 
these efforts moving forward. The past support of your subcommittee has 
greatly facilitated the success of these multi-State, multi-agency 
programs. Thank you for the subcommittee's past support and request the 
subcommittee's assistance for fiscal year 2012 funding to ensure BOR's 
continuing financial participation in these vitally important programs.
                                 ______
                                 
  Prepared Statement of the State of New Mexico, Office of the State 
                           Engineer, Santa Fe

    Dear Chairman Feinstein and Senator Alexander: I am writing to 
request your support and assistance in insuring continued funding for 
the Upper Colorado River Endangered Fish Recovery Program and the San 
Juan River Basin Recovery Implementation Program. These two successful 
ongoing cooperative partnership programs involve the States of 
Colorado, New Mexico, Utah, and Wyoming, Indian tribes, Federal 
agencies and water, power, and environmental interests. The State of 
New Mexico requests your support for an appropriation in the 
President's recommended budget for fiscal year 2012 of $6,248,000 to 
the Bureau of Reclamation (BOR) within the budget line item entitled 
``Endangered Species Recovery Implementation Program'' for the Upper 
Colorado Region.
    The Upper Colorado and San Juan recovery programs are national 
models of collaborative conservation partnerships working to recover 
endangered species while meeting water use and water development 
demands in compliance with the Federal Endangered Species Act (ESA), 
State law, and interstate compacts in the Intermountain West.
    Since 1988, the two programs, collectively, have provided ESA 
section 7 compliance (without litigation) for more than 2,160 Federal, 
tribal, State and privately managed water projects depleting more than 
3.7 million acre-feet of water per year. The Department of the Interior 
recognized these programs with its nationwide Cooperative Conservation 
Award in April 2008 as outstanding collaborative partnerships 
accomplishing substantial on-the-ground conservation results. 
Substantial non-Federal cost-sharing funding exceeding 50 percent is 
occurring pursuant to their authorization in Public Law 106-392, as 
amended.
    The requested Federal appropriations are critically important to 
these efforts moving forward. The past support of your subcommittee has 
greatly facilitated the success of these multi-State, multi-agency 
programs. On behalf of the citizens of New Mexico, I thank you for that 
support and request the subcommittee's assistance for fiscal year 2012 
funding to ensure BOR's continuing financial participation in these 
vitally important programs.
                                 ______
                                 
                Prepared Statement of The Navajo Nation

    Dear Chairman Feinstein and Senator Alexander: The Navajo Nation is 
an active participant in, and strong supporter of, the San Juan River 
Recovery Implementation Program. On behalf of the Navajo Nation, I am 
writing to request your support for continued funding in fiscal year 
2012 for the Upper Colorado River Endangered Fish Recovery Program and 
the San Juan River Basin Recovery Implementation Program as authorized 
by Public Law 106-392. These two successful ongoing cooperative 
partnership programs involve the States of Colorado, New Mexico, Utah, 
and Wyoming, Indian tribes, Federal agencies and water, power, and 
environmental interests. I request your support for an appropriation 
for fiscal year 2012 of $6,248,000 to the Bureau of Reclamation (BOR) 
within the budget line item entitled ``Endangered Species Recovery 
Implementation Program'' for the Upper Colorado Region, consistent with 
the President's recommended budget. Substantial non-Federal cost-
sharing funding is occurring pursuant to Public Law 106-392, as 
amended.
    The requested Federal appropriations are critically important to 
these efforts moving forward. The past support of your subcommittee has 
greatly facilitated the success of these multi-State, multi-agency 
programs. The Navajo Nation thanks the subcommittee for its past 
support and requests the subcommittee's assistance for fiscal year 2012 
funding to ensure BOR's continuing financial participation in these 
vitally important programs.
                                 ______
                                 
    Prepared Statement of the Tri-County Water Conservancy District

    Dear Chairman Feinstein and Senator Alexander: The Board of the 
Tri-County Water Conservancy District is writing to request your 
support for continued funding in fiscal year 2012 for the Upper 
Colorado River Endangered Fish Recovery Program and the San Juan River 
Basin Recovery Implementation Program as authorized by Public Law 106-
392. These two successful ongoing cooperative partnership programs 
involve the States of Colorado, New Mexico, Utah, and Wyoming, Indian 
tribes, Federal agencies and water, power, and environmental interests. 
We request your support for an appropriation for fiscal year 2012 of 
$6,248,000 to the Bureau of Reclamation (BOR) within the budget line 
item entitled ``Endangered Species Recovery Implementation Program'' 
for the Upper Colorado Region, consistent with the President's 
recommended budget. Substantial non-Federal cost-sharing funding is 
occurring pursuant to Public Law 106-392, as amended.
    The requested Federal appropriations are critically important to 
these efforts moving forward. The past support of your subcommittee has 
greatly facilitated the success of these multi-State, multi-agency 
programs. We thank you for the subcommittee's past support and request 
the subcommittee's assistance for fiscal year 2012 funding to ensure 
BOR's continuing financial participation in these vitally important 
programs.
                                 ______
                                 
   Prepared Statement of the Upper Gunnison River Water Conservancy 
                                District

    Dear Chairman Feinstein and Senator Alexander: I am writing to 
request your support for continued funding in fiscal year 2012 for the 
Upper Colorado River Endangered Fish Recovery Program and the San Juan 
River Basin Recovery Implementation Program as authorized by Public Law 
106-392. These two successful ongoing cooperative partnership programs 
involve the States of Colorado, New Mexico, Utah and Wyoming, Indian 
tribes, Federal agencies and water, power, and environmental interests. 
I request your support for an appropriation for fiscal year 2012 of 
$6,248,000 to the Bureau of Reclamation (BOR) within the budget line 
item entitled ``Endangered Species Recovery Implementation Program'' 
for the Upper Colorado Region, consistent with the President's 
recommended budget. Substantial non-Federal cost-sharing funding is 
occurring pursuant to Public Law 106-392, as amended.
    The requested Federal appropriations are critically important to 
these efforts moving forward. The past support of your subcommittee has 
greatly facilitated the success of these multi-State, multi-agency 
programs. I thank you for the subcommittee's past support and request 
the subcommittee's assistance for fiscal year 2012 funding to ensure 
BOR's continuing financial participation in these vitally important 
programs.
                                 ______
                                 
         Prepared Statement of the Utah Water Users Association

    Dear Chairman Feinstein and Senator Alexander: I am writing to 
request your support for continued funding in fiscal year 2012 for the 
Upper Colorado River Endangered Fish Recovery Program and the San Juan 
River Basin Recovery Implementation Program as authorized by Public Law 
106-392. These two successful ongoing cooperative partnership programs 
involve the States of Colorado, New Mexico, Utah and Wyoming, Indian 
tribes, Federal agencies and water, power and environmental interests. 
I request your support for an appropriation for fiscal year 2012 of 
$6,248,000 to the Bureau of Reclamation (BOR) within the budget line 
item entitled ``Endangered Species Recovery Implementation Program'' 
for the Upper Colorado Region, consistent with the President's 
recommended budget. Substantial non-Federal cost-sharing funding is 
occurring pursuant to Public Law 106-392, as amended.
    The requested Federal appropriations are critically important to 
these efforts moving forward. The past support of your subcommittee has 
greatly facilitated the success of these multi-State, multi-agency 
programs. I thank you for the subcommittee's past support and request 
the subcommittee's assistance for fiscal year 2012 funding to ensure 
BOR's continuing financial participation in these vitally important 
programs.
                                 ______
                                 
          Prepared Statement of the Wyoming Water Association

    Dear Chairman Feinstein and Senator Alexander: I am writing to 
request your support for continued funding in fiscal year 2012 for the 
Upper Colorado River Endangered Fish Recovery Program and the San Juan 
River Basin Recovery Implementation Program as authorized by Public Law 
106-392. These two successful ongoing cooperative partnership programs 
involve the States of Colorado, New Mexico, Utah and Wyoming, Indian 
tribes, Federal agencies and water, power, and environmental interests. 
I request your support for an appropriation for fiscal year 2012 of 
$6,248,000 to BOR within the budget line item entitled ``Endangered 
Species Recovery Implementation Program'' for the Upper Colorado 
Region, consistent with the President's recommended budget. Substantial 
non-Federal cost-sharing funding is occurring pursuant to Public Law 
106-392, as amended.
    The requested Federal appropriations are critically important to 
these efforts moving forward. The past support of your subcommittee has 
greatly facilitated the success of these multi-State, multi-agency 
programs. I thank you for the subcommittee's past support and request 
the subcommittee's assistance for fiscal year 2012 funding to ensure 
BOR's continuing financial participation in these vitally important 
programs.


       LIST OF WITNESSES, COMMUNICATIONS, AND PREPARED STATEMENTS

                              ----------                              
                                                                   Page

Alexander, Senator Lamar, U.S. Senator From Tenneessee:
    Opening Statement of.........................................
      126........................................................
    Questions Submitted by.....................................119, 188
    Statements of................................................ 3, 93
Altira Group, LLC, Prepared Statement of the.....................
  224............................................................
American:
    Association of Petroleum Geologists, Prepared Statement of 
      the........................................................
      224........................................................
    Gas Association, Prepared Statement of the...................
      226........................................................
    Geological Institute, Prepared Statement of the..............
      229........................................................
    Public Power Association, Prepared Statement of the..........
      230........................................................
    Society:
        For Microbiology, Prepared Statement of the..............
          232....................................................
        Of:
            Agronomy, Prepared Statement of the..................
              235................................................
            Plant Biologists, Prepared Statement of the..........
              237................................................
    Wind Energy Association, Prepared Statement of the...........
      238........................................................
Anadarko Petroleum Corporation, Prepared Statement of............
  241............................................................
APS Four Corners Power Plant, Prepared Statement of the..........
  308............................................................
Aurora Water, Prepared Statement of..............................
  308............................................................

BHP Navajo Coal Company, Prepared Statement of the...............
  308............................................................
Board of:........................................................
    Commissioners, Fifth Louisiana Levee District, Prepared 
      Statement of the...........................................
      201........................................................
    Levee Commissioners for the Yazoo-Mississippi Delta, Prepared 
      Statement of the...........................................
      202........................................................
    Mississippi Levee Commissioners, Prepared Statement of the...
      203........................................................
Bob Lawrence & Associates, Inc., Prepared Statement of...........
  241............................................................
Bryant, Dr. Steven, Prepared Statement of........................
  255............................................................

Castle, Hon. Anne, Assistant Secretary for Water and Science, 
  Bureau of Reclamation, Department of the Interior..............
  18.............................................................
    Prepared Statement of........................................
      19.........................................................
Center for Advanced Separation Technologies, Prepared Statement 
  of the.........................................................
  243............................................................
Central Utah Water Conservancy District, Prepared Statement of 
  the............................................................
  309............................................................
Chu, Hon. Steven, Secretary, Office of the Secretary, Department 
  of Energy......................................................
  125............................................................
    Prepared Statement of........................................
      130........................................................
    Summary Statement of.........................................
      128........................................................
City of:
    Farmington, Prepared Statement of the........................
      309........................................................
    Morro Bay, California, Prepared Statement of the.............
      205........................................................
Coal Utilization Research Council, Prepared Statement of the.....
  245............................................................
Cochran, Senator Thad, U.S. Senator From Mississippi, Prepared 
  Statement of...................................................
  4..............................................................
Colorado:
    Oil & Gas Association, Prepared Statement of the.............
      248........................................................
    River:
        Basin Salinity Control Forum, Prepared Statement of the..
          309....................................................
        District, Prepared Statement of the......................
          311....................................................
    Water Congress, Prepared Statement of the....................
      312........................................................
Connor, Hon. Michael L., Commissioner, Bureau of Reclamation, 
  Department of the Interior.....................................
  25.............................................................
    Prepared Statement of........................................
      27.........................................................
    Questions Submitted to.......................................
      77.........................................................
Cook, Dr. Donald, Deputy Administrator for Defense Programs, 
  National Nuclear Security Administration, Department of Energy.
  91.............................................................
Crop Science Society of America, Prepared Statement of the.......
  235............................................................
Cummins Inc., Prepared Statement of..............................
  249............................................................

D'Agostino, Hon. Thomas P., Under Secretary for Nuclear Security 
  and Administration, National Nuclear Security Administration, 
  Department of Energy...........................................
  91.............................................................
    Prepared Statement of........................................
      97.........................................................
    Summary Statement of.........................................
      95.........................................................
Darcy, Hon. Jo-Ellen, Assistant Secretary of the Army (Civil 
  Works), Corps of Engineers--Civil, Department of the Army, 
  Department of Defense--Civil...................................
  1..............................................................
    Prepared Statement of........................................
      6..........................................................
    Questions Submitted to.......................................
      59.........................................................
    Summary Statement of.........................................
      5..........................................................
Denver Water, Prepared Statement of..............................
  312............................................................
Diesel Technology Forum, Prepared Statement of the...............
  251............................................................
Dolores Water Conservancy District, Prepared Statement of the....
  312............................................................
Donald, Admiral Kirkland, Deputy Administrator for Naval 
  Reactors, National Nuclear Security Administration, Department 
  of Energy......................................................
  91.............................................................

Edison Electric Institute, Prepared Statement of the.............
  256............................................................
Electric Drive Transportation Association, Prepared Statement of 
  the............................................................
  258............................................................
Energy:
    Committee of ASME's Technical Communities, Prepared Statement 
      of the.....................................................
      259........................................................
    Efficiency Coalition, Prepared Statement of the..............
      261........................................................
Environmental Council of the States, Prepared Statement of the...
  199............................................................
EnviroScience, Inc., Prepared Statement of.......................
  206............................................................
Executive Committee of the Fermi National Accelerator Laboratory 
  Users Organization, Prepared Statement of the..................
  262............................................................

Federation of American Societies for Experimental Biology, 
  Prepared Statement of the......................................
  265............................................................
Feinstein, Senator Dianne, U.S. Senator From California:
    Opening Statements of....................................1, 91, 125
    Questions Submitted by..................................65, 77, 112
Fuel Cell and Hydrogen Energy Association, Prepared Statement of 
  the............................................................
  266............................................................

Gas:
    Technology Institute, Prepared Statement of the..............
      268........................................................
    Turbine Association, Prepared Statement of the...............
      271........................................................
GE Energy, Prepared Statement of.................................
  273............................................................
Graham, Senator Lindsey, U.S. Senator From South Carolina, 
  Questions Submitted by.........................................
  192............................................................
Grand Valley Water Users Association, Prepared Statement of the..
  313............................................................
GSI Environmental Inc., Prepared Statement of....................
  276............................................................

Harkin, Senator Tom, U.S. Senator From Iowa, Questions Submitted 
  by.............................................................
  180............................................................
Harrington, Anne, Deputy Administrator for Defense Nuclear 
  Nonproliferation, National Nuclear Security Administration, 
  Department of Energy...........................................
  91.............................................................
Hill, Jr., Richard Newton, Former President/Owner of Hill 
  Equipment Corp., Prepared Statement of.........................
  290............................................................

Inouye, Senator Daniel K., U.S. Senator From Hawaii, Questions 
  Submitted by...................................................
  196............................................................
Izaak Walton League of America, Prepared Statement of the........
  207............................................................

Jicarilla Apache Nation, Prepared Statement of the...............
  313............................................................
Johnson, Senator Tim, U.S. Senator From South Dakota, Questions 
  Submitted by..............................................75, 89, 178

Landrieu, Senator Mary L., U.S. Senator From Louisiana, Questions 
  Submitted by...................................................59, 75
Lautenberg, Senator Frank R., U.S. Senator From New Jersey, 
  Questions Submitted by.........................................
  180............................................................
Little River Drainage District, Prepared Statement of the........
  218............................................................
Lower Brule Rural Water System, Prepared Statement of the........
  213............................................................

McConnell, Senator Mitch, U.S. Senator From Kentucky, Questions 
  Submitted by.............................................62, 123, 192
Mead, Matthew H., Governor, State of Wyoming, Prepared Statement 
  of.............................................................
  318............................................................
Mississippi Valley Flood Control Association, Prepared Statement 
  of the.........................................................
  209............................................................
Missouri River Association of States and Tribes, Prepared 
  Statement of the...............................................
  212............................................................
Moss Landing Harbor District, California, Prepared Statement of 
  the............................................................
  215............................................................
Murkowski, Senator Lisa, U.S. Senator From Alaska, Questions 
  Submitted by...................................................
  63.............................................................
Murray, Senator Patty, U.S. Senator From Washington, Questions 
  Submitted by..............................................59, 89, 172
Murray, Reed, Program Director, Central Utah Project Completion 
  Act 
  Office.........................................................
  18.............................................................

National:
    Association:
        For State Community Services Programs, Prepared Statement 
          of 
          the....................................................
          278....................................................
        Of State Energy Officials, Prepared Statement of the.....
          280....................................................
    Hydropower Association, Prepared Statement of the............
      283........................................................
Nature Conservancy, Prepared Statement of the....................
  219............................................................
Navajo Nation, Prepared Statement of the.........................
  323............................................................
New Mexico:
    Interstate Stream Commission, Prepared Statement of the......
      319........................................................
    Institute of Mining and Technology, Prepared Statement of the
      285........................................................
    State Engineer, Prepared Statement of the....................
      319........................................................
Northern Colorado Water Conservancy District, Prepared Statement 
  of the.........................................................
  320............................................................
NuScale Power, Inc., Prepared Statement of.......................
  289............................................................
Nuclear Energy Institute, Prepared Statement of the..............
  286............................................................

Oglala Sioux Rural Water Supply System, Prepared Statement of the
  313............................................................
Ohio Lake Management Society, Prepared Statement of the..........
  216............................................................
Orchard Mesa Irrigation District, Prepared Statement of the......
  321............................................................

PNM Resources, Inc., Prepared Statement of.......................
  321............................................................

Reed, Senator Jack, U.S. Senator From Rhode Island, Questions 
  Submitted by...................................................
  76.............................................................
Rosebud Rural Water System, Prepared Statement of the............
  313............................................................

San Juan Water Commission, Prepared Statement of the.............
  321............................................................
Society for Industrial and Applied Mathematics, Prepared 
  Statement of the...............................................
  292............................................................
Soil Science Society of America, Prepared Statement of the.......
  235............................................................
Southern:
    Company Generation, Prepared Statement of....................
      294........................................................
    Ute Indian Tribe, Prepared Statement of the..................
      322........................................................
Southwestern Water Conservation District, Prepared Statement of 
  the............................................................
  322............................................................
State of New Mexico, Office of the State Engineer, Santa Fe, 
  Prepared Statement of the......................................
  322............................................................
Stockton Port District, California, Prepared Statement of the....
  216............................................................
Symbiotics, Prepared Statement of................................
  297............................................................

Technology International, Inc., Prepared Statement of............
  298............................................................
Tester, Senator Jon, U.S. Senator From Montana, Questions 
  Submitted by.................................................117, 183
Tri-County Water Conservancy District, Prepared Statement of the.
  323............................................................

Universities Research Association, Inc., Prepared Statement of 
  the............................................................
  299............................................................
University Corporation for Atmospheric Research, Prepared 
  Statement of 
  the............................................................
  300............................................................
Upper Gunnison River Water Conservancy District, Prepared 
  Statement of the...............................................
  324............................................................
Utah Water Users Association, Prepared Statement of the..........
  324............................................................

Van Antwerp, Lieutenant General Robert L., Chief of Engineers, 
  Corps of Engineers--Civil, Department of the Army, Department 
  of Defense--Civil..............................................
  13.............................................................
    Prepared Statement of........................................
      14.........................................................
    Questions Submitted to.......................................
      65.........................................................
Ventura Harbor, Ventura Port District--California, Prepared 
  Statement of the...............................................
  222............................................................

West River/Lyman Jones Rural Water System, Prepared Statement of 
  the............................................................
  313............................................................
West Virginia University, Prepared Statement of..................
  302............................................................
Wilkes University, College of Science and Engineering, Prepared 
  Statement of...................................................
  305............................................................
Wyoming Water Association, Prepared Statement of the.............
  324............................................................


                             SUBJECT INDEX

                              ----------                              

                      DEPARTMENT OF DEFENSE--CIVIL

                         Department of the Army

                       Corps of Engineers--Civil

                                                                   Page

Additional Committee Questions...................................    58
America's Great Outdoors Initiative and Civil Works Recreation...    11
American Recovery and Reinvestment Act...........................    12
Aquatic Ecosystem Restoration....................................     9
California-Specific Questions....................................    73
Coastal Restoration and Protection--Louisiana Coastal Area.......    61
Completion of the Levee System for the Greater New Orleans Area..    59
Construction Program.............................................    15
Dam Safety.......................................................    67
Direct Program...................................................    14
Dredging Needs on the Mississippi................................    61
Efficiency and Effectiveness of the Corps of Engineers Operations    16
Emergency Response...............................................    17
Fiscal Year 2012 Discretionary Funding Level.....................     7
Harbor Maintenance Trust Fund....................................11, 65
Infrastructure Recapitalization..................................    10
Inland Waterway Trust Fund.......................................11, 62
Investigations Program...........................................    14
Levee:
    Certification................................................72, 75
    Vegetation...................................................    70
Lower-Priority Programs..........................................    12
National Defense.................................................    17
New:
    Investments in Fiscal Year 2012..............................     9
    Starts.......................................................    69
Operation and Maintenance Program................................    15
Panama Canal.....................................................    76
Planning:
    Improvements.................................................    11
    Program Modernization........................................    16
Proposed Legislation.............................................    16
Reimbursable Program.............................................    16
Research and Development.........................................    17
Small Ports......................................................    68
Summary of Fiscal Year 2012 Program Budget.......................    14
Veterans Curation Project........................................    12

                          DEPARTMENT OF ENERGY

Additional Committee Questions...................................   171
Advanced Cable and Conductors Program (Formerly High Temperature 
  Superconducting Program).......................................   177
American Recovery and Reinvestment Act...........................   189
Biofuels.........................................................   180
Blue Ribbon Commission on Nuclear Waste..........................   189
Clean Renewable Energy Bonds.....................................   178
Cleanup Budgets for the Nuclear Weapons Complex..................   199
Contracts Management.............................................   190
Coordination of Power Marketing Administrations and the 
  Department of Energy Policy....................................   186
Department of Energy Fiscal Year 2012 Program Office Highlights..   138
Deep Underground Science and Engineering Laboratory at Homestake.   155
Deepwater Offshore Wind Technologies.............................   159
Distributed Wind...............................................182, 184
Energy Research and Subsidies....................................   151
Enriched Uranium Tails at Paducah................................   147
Environmental:
    Impact of Fracking...........................................   151
    Management...................................................   172
Fiscal Responsibility............................................   132
Fossil Energy....................................................   192
Fracking.........................................................   158
Fuel Cells.......................................................   183
Geothermal Funding...............................................   162
Global Energy Race...............................................   150
H-Canyon.........................................................   193
High-Priority Experiments........................................   156
Highlights of the Fiscal Year 2012 Budget Request................   132
Hydrogen.........................................................   194
    Technologies.................................................   145
    And Fuel:
        Cell Technologies........................................   176
        Cells....................................................   182
Leading in the Global Clean-Energy Economy.......................   131
Loan:
    Guarantee Program............................................   172
        Credit Subsidies.........................................   167
    Guarantees for Advanced Technology Automobiles...............   157
Mechanical Insulation Program....................................   187
Mississippi River Level..........................................   157
Nuclear:
    Energy and Energy Security...................................   153
    Fuel Rods and Dry Cast Storage...............................   170
    Safety and Security..........................................   132
Oak Ridge Cleanup................................................   189
Office of Environmental Management Budget and Nuclear Cleanup....   164
Rural Implementation.............................................   186
Savannah River Site Pensions.....................................   195
Science Labs.....................................................   191
Small Modular Reactors...........................................   169
Solar:
    Energy Technology Program....................................   177
    Technology Prices/Subsidies..................................   146
Spent Nuclear Fuel Storage.......................................   166
State Environmental Agency Directors Support Fiscal Year 2012 
  Funding Appropriation for U.S. Department of Energy's Nuclear 
  Cleanup Work...................................................   199
Strategic Petroleum Reserve....................................154, 192
Supporting Groundbreaking Science................................   131
Water Power Program..............................................   174
Western Area Power Administration Transmission...................   184
Yucca Mountain...................................................   163
    Nuclear Waste................................................   154

                National Nuclear Security Administration

Additional Committee Questions...................................   112
Export Control Regulations.......................................   119
Four-Year Effort.................................................   115
Implementing the President's Nuclear Security Agenda.............    98
Improving the Way National Nuclear Security Administration Does 
  Business.......................................................    99
Investing in the Future..........................................    97
Material Consolidation...........................................   116
Naval Reactors Facility, Idaho National Laboratory...............   120
Small Modular Reactors Program...................................   122
Technological Surprise...........................................   116
Uranium Downblending.............................................   122

                       DEPARTMENT OF THE INTERIOR

                         Bureau of Reclamation

Additional Committee Questions...................................    58
Administrative Cost Savings and Management Efficiencies..........    31
Aging Infrastructure.............................................    80
Allocations Without Earmarks.....................................    39
Bay-Delta Interagency Plan.......................................    82
CALFED...........................................................    85
California Bay-Delta Restoration Fund............................    32
Cedar Rapids, Iowa...............................................    52
Central:
    Utah Project Completion Act..................................    24
    Valley Project Restoration Fund..............................32, 84
Chickamauga Lock.................................................    35
Climate Change...................................................    81
Continuing Authorities Program...................................    47
Fiscal:
    Responsibility...............................................    21
    Year 2012 Planned Activities.................................    32
Funding:
    Decisions....................................................    50
    Harbor Deepening.............................................    45
Harbor Maintenance Trust Fund....................................    33
Highlights of the Fiscal Year 2012 Request for Water and Related 
  Resources......................................................    28
Hydropower.......................................................    23
Imperial, Coachella, and Metropolitan Water......................    87
Indian Water Rights:
    Settlement...................................................    77
    Settlements..................................................    31
Inland Waterway Trust Fund.......................................    36
Investing in the Future..........................................    21
Kennebec River...................................................    43
Lake Powell/Lake Mead............................................    87
Levee Certification..............................................42, 52
Mississippi River and Tributaries Project........................    40
Mni Wiconi.......................................................    79
Needs Assessment.................................................    79
Odessa Subarea Special Study.....................................    89
Operation and Maintenance........................................    80
Passaic River Basin..............................................    49
Policy and Administration........................................    31
Principles and Guidelines........................................    80
Quagga Mussel....................................................    88
Rural Water......................................................79, 89
San Joaquin River Restoration....................................    86
    Fund.........................................................    32
Secure Water.....................................................    81
South of Delta Water Allocations.................................    83
Title XVI Program................................................    82
2010 Accomplishments.............................................    20
Upper Mississippi River Navigation...............................    53
Water and Related Resources......................................    28
Yellowstone Intake Diversion Dam.................................    42

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