    [House Hearing, 114 Congress]
    [From the U.S. Government Publishing Office]

                THE FISCAL YEAR 2016 DEPARTMENT OF ENERGY BUDGET

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

                                    HEARING

                                   BEFORE THE

                        SUBCOMMITTEE ON ENERGY AND POWER

                                     OF THE

                        COMMITTEE ON ENERGY AND COMMERCE
                            HOUSE OF REPRESENTATIVES

                        ONE HUNDRED FOURTEENTH CONGRESS

                                 FIRST SESSION

                                   __________

                               FEBRUARY 11, 2015

                                   __________

                               Serial No. 114-10

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

          Printed for the use of the Committee on Energy and Commerce

                            energycommerce.house.gov
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                        COMMITTEE ON ENERGY AND COMMERCE

                              FRED UPTON, Michigan
                                     Chairman
    JOE BARTON, Texas                    FRANK PALLONE, Jr., New Jersey
      Chairman Emeritus                    Ranking Member
    ED WHITFIELD, Kentucky               BOBBY L. RUSH, Illinois
    JOHN SHIMKUS, Illinois               ANNA G. ESHOO, California
    JOSEPH R. PITTS, Pennsylvania        ELIOT L. ENGEL, New York
    GREG WALDEN, Oregon                  GENE GREEN, Texas
    TIM MURPHY, Pennsylvania             DIANA DeGETTE, Colorado
    MICHAEL C. BURGESS, Texas            LOIS CAPPS, California
    MARSHA BLACKBURN, Tennessee          MICHAEL F. DOYLE, Pennsylvania
      Vice Chairman                      JANICE D. SCHAKOWSKY, Illinois
    STEVE SCALISE, Louisiana             G.K. BUTTERFIELD, North Carolina
    ROBERT E. LATTA, Ohio                DORIS O. MATSUI, California
    CATHY McMORRIS RODGERS, Washington   KATHY CASTOR, Florida
    GREGG HARPER, Mississippi            JOHN P. SARBANES, Maryland
    LEONARD LANCE, New Jersey            JERRY McNERNEY, California
    BRETT GUTHRIE, Kentucky              PETER WELCH, Vermont
    PETE OLSON, Texas                    BEN RAY LUJAN, New Mexico
    DAVID B. McKINLEY, West Virginia     PAUL TONKO, New York
    MIKE POMPEO, Kansas                  JOHN A. YARMUTH, Kentucky
    ADAM KINZINGER, Illinois             YVETTE D. CLARKE, New York
    H. MORGAN GRIFFITH, Virginia         DAVID LOEBSACK, Iowa
    GUS M. BILIRAKIS, Florida            KURT SCHRADER, Oregon
    BILL JOHNSON, Ohio                   JOSEPH P. KENNEDY, III,
    BILLY LONG, Missouri                     Massachusetts
    RENEE L. ELLMERS, North Carolina     TONY CARDENAS, California
    LARRY BUCSHON, Indiana
    BILL FLORES, Texas
    SUSAN W. BROOKS, Indiana
    MARKWAYNE MULLIN, Oklahoma
    RICHARD HUDSON, North Carolina
    CHRIS COLLINS, New York
    KEVIN CRAMER, North Dakota
                        Subcommittee on Energy and Power

                             ED WHITFIELD, Kentucky
                                     Chairman
    PETE OLSON, Texas                    BOBBY L. RUSH, Illinois
      Vice Chairman                        Ranking Member
    JOHN SHIMKUS, Illinois               JERRY McNERNEY, California
    JOSEPH R. PITTS, Pennsylvania        PAUL TONKO, New York
    ROBERT E. LATTA, Ohio                ELIOT L. ENGEL, New York
    GREGG HARPER, Vice Chairman          GENE GREEN, Texas
    DAVID B. McKINLEY, West Virginia     LOIS CAPPS, California
    MIKE POMPEO, Kansas                  MICHAEL F. DOYLE, Pennsylvania
    ADAM KINZINGER, Illinois             KATHY CASTOR, Florida
    H. MORGAN GRIFFITH, Virginia         JOHN P. SARBANES, Maryland
    BILL JOHNSON, Ohio                   PETER WELCH, Vermont
    BILLY LONG, Missouri                 JOHN A. YARMUTH, Kentucky
    RENEE L. ELLMERS, North Carolina     DAVID LOEBSACK, Iowa
    BILL FLORES, Texas                   FRANK PALLONE, Jr., New Jersey (ex
    MARKWAYNE MULLIN, Oklahoma               officio)
    RICHARD HUDSON, North Carolina
    JOE BARTON, Texas
    FRED UPTON, Michigan (ex officio)

                                 C O N T E N T S

                                  ----------
                                                                       Page
    Hon. Ed Whitfield, a Representative in Congress from the
      Commonwealth of Kentucky, opening statement....................     1
        Prepared statement...........................................     4
    Hon. Bobby L. Rush, a Representative in Congress from the State
      of Illinois, opening statement.................................     5
    Hon. Fred Upton, a Representative in Congress from the State of
      Michigan, opening statement....................................     6
        Prepared statement...........................................     7
    Hon. Frank Pallone, Jr., a Representative in Congress from the
      State of New Jersey, opening statement.........................     8

                                   Witnesses

    Ernest J. Moniz, Secretary, U.S. Department of Energy............     9
        Prepared statement...........................................    11
        Answers to submitted questions \1\...........................    69

                               Submitted Material

    Chart entitled, ``DOE Budget for Applied Energy and ARPA-E,''
      submitted by Mr. Whitfield.....................................     3

    ----------
    \1\ Available at:http://docs.house.gov/meetings/if/if03/20150211/
      102942/hhrg-114-if03-wstate-monize-20150211-sd543.pdf.

                THE FISCAL YEAR 2016 DEPARTMENT OF ENERGY BUDGET

                                  ----------

                          WEDNESDAY, FEBRUARY 11, 2015

                      House of Representatives,
                      Subcommittee on Energy and Power,
                              Committee on Energy and Commerce,
                                                        Washington, DC.
        The subcommittee met, pursuant to call, at 1:00 p.m., in
    room 2322, Rayburn House Office Building, Hon. Ed Whitfield
    (chairman of the subcommittee) presiding.
        Present: Representatives Whitfield, Olson, Barton, Shimkus,
    Latta, McKinley, Pompeo, Kinzinger, Griffith, Hohnson, Long,
    Ellmers, Flores, Mullin, Hudson, Upton (ex officio), Rush,
    McNerney, Tonko, Engel, Capps, Doyle, Castor, Sarbanes,
    Yarmuth, Loebsack, and Pallone (ex officio).
        Staff Present: Nick Abraham, Legislative Clerk; Gary
    Andres, Staff Director; Charlotte Baker, Deputy Communications
    Director; Sean Bonyun, Communications Director; Leighton Brown,
    Press Assistant; Allison Busbee, Policy Coordinator, Energy &
    Power; Patrick Currier, Counsel, Energy & Power; Tom
    Hassenboehler, Chief Counsel, Energy & Power; Peter Kielty,
    Deputy General Counsel; David McCarthy, Chief Counsel,
    Environment/Economy; Brandon Mooney, Professional Staff Member,
    E & P; Mary Neumayr, Senior Energy Counsel; John Ohly,
    Professional Staff, O & I; Chris Sarley, Policy Coordinator,
    Environment & Economy; Peter Spencer, Professional Staff
    Member, Oversight; Jeff Carroll, Minority Staff Director; Rick
    Kessler, Minority Senior Advisor and Staff Director, Energy and
    Environment; and Ryan Schmit, Minority EPA Detailee.

      OPENING STATEMENT OF HON. ED WHITFIELD, A REPRESENTATIVE IN
               CONGRESS FROM THE COMMONWEALTH OF KENTUCKY

        Mr. Whitfield. I would like to call the meeting to order.
        Today's hearing is the review of the fiscal year 2016
    Department of Energy budget, and I would like to recognize
    myself 5 minutes for an opening statement.
        Today we are going to examine the Department of Energy's
    proposed budget for fiscal year 2016. I am delighted that
    Secretary Moniz is here with us today. I want to say to him
    that I have great respect and admiration for him. I must also
    say that I don't have a lot of respect and admiration for the
    administration's energy policies.
        But this proposed budget for 2016 is $29.9 billion, a 9
    percent increase over last year's appropriation. Interestingly
    enough, many people are making the argument that while DOE's
    budget request is growing, the Agency's role in setting the
    energy policy for the United States seems to be diminishing
    because EPA, through its regulations, seems to be dictating the
    energy policy more and more for America.
        Now, the potential damage goes well beyond the thousands of
    coal miners and tens of thousands of coal-fired power plant
    employees who have lost their jobs under this administration.
    Electric bills are on the rise, and reliability concerns are an
    increasing focus of a lot of different entities. And these are
    serious concerns. As a direct result of EPA's proposed
    regulations on new power plants, you cannot build a state-of-
    the-art coal-fired plant today in America, the type that is
    being built today in Japan, in Germany, in China, in India, and
    in many other countries around the world.
        Now, I understand that low natural gas prices play a part,
    but EPA has effectively put a moratorium on construction by
    requiring that new plants use carbon capture technology that
    has not been demonstrated as commercially viable for power
    generation in America. And we continue to see that the
    prospects for CCS power plant commercialization are slipping
    years into the future, according to the Department of Energy
    itself.
        So at a time when EPA is ratcheting up the regulatory
    demands on coal-fired electric generation, DOE is reducing the
    fossil energy research and development program that could help
    the sector find ways to comply.
        Just last week the agency stopped the FutureGen program
    even though EPA's regulatory agenda continues to require that
    new power plants install carbon capture and storage.
        Now, nothing speaks better about a budget than the budget
    itself, and this slide illustrates precisely what I would like
    it to say. This budget shows on the far left, that is the DOE
    budget for renewables and energy efficiency; and the rest of
    it, as you can see, all of them combined does not equal that.
        [Slide shown.]
        [GRAPHIC] [TIFF OMITTED] T5232.022

        Now the President of the United States goes around the
    country and the world talking about an all-of-the-above energy
    policy, but when you look at the budget of his Department of
    Energy, you see that his policy is about renewables and nothing
    else primarily. So that is a real disappointment.
        I might also just mention that I don't think the
    President's $38 million reduction in his request for funding at
    the Paducah Gas' diffusion site is a good sign. The DOE has now
    awarded the deactivation contract at this site. There is a
    mechanism to begin significant work, but consistent and
    adequate funding to begin cleanup is necessary.
        Overall, my issues with the proposed budget reflect my
    issues with the direction that this administration has taken on
    the energy policy, which is being climate-driven. And I think
    the budget, this slide, certainly reflects that.
        And with that, I would yield back the balance of my time.
        And I would like to recognize the gentleman from Illinois
    for his opening statement.
        [The prepared statement of Mr. Whitfield follows:]

                    Prepared statement of Hon. Ed Whitfield

        This afternoon we will examine the Department of Energy's
    proposed budget for fiscal year 2016. I welcome Secretary Moniz
    and look forward to hearing your thoughts on this proposed
    budget as well as your answers to our questions.
        DOE's proposed budget for 2016 is $29.9 billion dollars, a
    9 percent increase over last year's appropriation. DOE's budget
    request is growing, yet the agency's role in setting the
    nation's energy policy is shrinking. DOE has relinquished the
    lead to EPA, and much of DOE's actions amount to little more
    than a support role, in particular providing justification for
    EPA's efforts to handicap coal and other fossil fuels in the
    name of addressing climate change.
        The potential damage goes well beyond the thousands of coal
    miners and tens of thousands of coal-fired power plant
    employees who have lost their jobs under the Obama
    administration. Electric bills are on the rise, and reliability
    concerns are real and growing. Secretary Moniz, you will have
    the distinction of seeing more coal-fired generation shut down
    during your tenure than any other Secretary of Energy, and by a
    wide margin. While the President and the environmentalists may
    applaud you for that, I can assure you the citizens of Kentucky
    and other coal states would not.
        As a direct result of EPA's proposed regulations on new
    power plants, you cannot build a state-of-the-art coal fired
    power plant today in the United States--the type being built
    today in Japan, in Germany, in China, in India and other parts
    of the world. Low natural gas prices play a part, but EPA has
    effectively put a moratorium on construction by requiring that
    new plants use Carbon Capture technology that has not been
    demonstrated as commercially viable for power generation in
    this country. And, we continue to see that the prospects for
    CCS power plant commercialization are slipping years into the
    future, according to your agency.
        So, at a time when EPA is ratcheting up the regulatory
    demands on coal-fired electric generation, DOE is cutting back
    on the Fossil Energy Research and Development program that
    could help this sector find ways to comply. And, just last
    week, the agency put an end to the FutureGen program even
    though EPA's regulatory agenda continues to require that new
    power plants install carbon capture and storage.
        I believe that a good budget reflects reality, and that a
    bad one reflects wishful thinking. I'd like to point to a slide
    that shows the DOE budget for Applied Energy and ARPA-E. As in
    previous years, this DOE budget lavishes large sums on wind and
    solar energy and other renewables. The requested budget for the
    Office of Energy Efficiency and Renewable Energy (EERE) is more
    than all of the other Applied Energy Office and ARPA-E budgets
    combined. But despite all this funding, non-hydro renewables
    remain less than 10 percent of our nation's electricity supply,
    and they create serious cost and reliability concerns that are
    likely to preclude a significant increase. Wind and solar will
    always remain an intermittent and minor contributor relative to
    base load sources such as coal, nuclear, and natural gas.
    Granted, the Office of Energy Efficiency & Renewable Energy
    does some useful work that should continue, but its $2.7
    billion dollar budget is well out of proportion to the
    potential benefits and the realities of our nation's energy
    needs. I would prefer that proposed spending levels better
    reflected the reality of America's current and future energy
    mix.
        I might also add that I am extremely disappointed with the
    President's $38 Million reduction in request for funding at the
    Paducah Gaseous Diffusion site in Paducah, Kentucky. Since the
    DOE has now awarded the deactivation contract at the site,
    there is a mechanism to begin significant work, but consistent
    and adequate funding to begin cleanup is necessary. Now is not
    the time to slow down, but to push the project forward. I look
    forward to addressing this issue with you.
        I remain a strong critic of EPA's proposed rules for new
    and existing coal-fired power plants and I will have many
    questions about these and other regulations at EPA's upcoming
    budget hearing. But as long as these measures remain part of
    the administration's energy agenda, I believe that DOE research
    efforts should be directed towards assisting industry in
    meeting these requirements.
        Overall, my issues with the proposed budget reflect my
    issues with the direction the administration has taken on its
    climate driven energy policy.

     OPENING STATEMENT OF HON. BOBBY L. RUSH, A REPRESENTATIVE IN
                  CONGRESS FROM THE STATE OF ILLINOIS

        Mr. Rush. I want to thank you, Mr. Chairman.
        And I want to welcome you, Secretary Moniz. I also want to
    commend you for the outstanding work that you are doing across
    the board, but I want to specifically commend you for the
    legacy that you are working to establish at the Department of
    Energy in regards to transitioning the agency to be more
    attuned to the needs of all segments of the diverse American
    population.
        Through the Minorities in Energy Initiative, which
    celebrated its 1-year anniversary back in November of last
    year, the more recent Job Strategy Council, which you
    established this past January, I am extremely encouraged by
    these policies which seek to position DOE as a proactive,
    forward-thinking agency that can be part of the solution rather
    than part of the problem.
        Your staff, Mr. Secretary, recently got back to my office
    with constructive feedback on the workforce development bill
    that I introduced in the last Congress, and I was very
    encouraged to see that many of the policies and programs
    outlined in the bill align seamlessly with many of the
    proposals that you have initiated within the Agency.
        Of course, as we both understand, the steps that have been
    taken are only the beginning stages of a longer process that
    would take time, effort, and resources to fully implement and
    become effective. The problem of underserved communities being
    historically left out of the energy sector both in the private
    and public realm did not happen overnight, and the policies
    needed to address these issues will not take hold overnight.
        The good news, Mr. Secretary, is that today there is a
    focus on trying to proactively promote diversity and inclusion
    within all sections of the industry, and there is widespread
    support for policies that can help accomplish this goal. On
    this subcommittee alone, members on both sides of the aisle
    have expressed interest in moving forward with legislation
    designed to target women, minorities, veterans, and other
    underrepresented groups, and to help train and prepare them for
    the energy and manufacturing jobs of the present and of the
    future.
        Industry groups, labor unions, community colleges, and
    universities, all understand that it is a win-win situation to
    help prepare a more than willing labor force for the well-
    paying jobs and careers that can be found in all sectors of the
    energy industry.
        In America's new energy renaissance, where a skilled
    workforce is mandatory for building new infrastructure, to
    installing wind turbines or solar panels, to designing the
    latest technological advances in drilling, the possibilities
    for the American worker are becoming more and more abundant.
    And ensuring that all segments of the American population are
    given access and equal opportunity to participate in this
    American energy renaissance will only serve as a benefit to
    industry, to communities, and to the American economy as a
    whole.
        So, Mr. Secretary, I say thumbs up to your agency, thumbs
    up to your plans, thumbs up to your budget. Let's get this good
    work that the American people have called us to do, let's start
    working on it immediately, if not sooner.
        Thank you, and I yield back.
        Mr. Whitfield. Thank you, Mr. Rush.
        At this time I would like to recognize the chairman of the
    full committee, Mr. Upton, for 5 minutes.

       OPENING STATEMENT OF HON. FRED UPTON, A REPRESENTATIVE IN
                  CONGRESS FROM THE STATE OF MICHIGAN

        Mr. Upton. Mr. Secretary, welcome back.
        I know that today's discussion is just one of the many that
    DOE is conducting as we look forward to working together to
    create a 21st Century energy policy.
        You know, the areas of disagreement between Republicans and
    this administration often get the most attention. But while
    those differences remain, I am one who always looks for areas
    of agreement, areas of common ground on an energy policy that
    can benefit all Americans. We have seen a tremendous increase
    in oil and natural gas production here in the U.S. And across
    North America. We are already seeing the benefits of abundant
    and affordable energy, whether it be at the gas pump, our power
    bills, and with the creation of new jobs. But for more
    Americans to see even better benefits, we need to move beyond
    decades-old energy scarcity policies. We need to maximize the
    benefit of North American energy, and at this committee we call
    it the building of the architecture of abundance.
        The first step is to upgrade and modernize our energy
    infrastructure. The new energy coming on line is of no use if
    we can't deliver it to consumers and businesses. We need a
    modern and more resilient infrastructure to safely and
    responsibly maximize our growing oil and gas output.
        Our bipartisan pipeline safety legislation was an important
    milestone. Yes, it was. But there is more work to do. We also
    need to ensure that our electric grid can meet the challenges
    of the future, from everything from advanced grid technologies,
    to protecting against weather events or physical or
    cybersecurity threats.
        Our energy abundance is also proving to be a powerful jobs
    creator, not only in places like Texas and North Dakota, where
    production is booming, but also in Michigan and other
    manufacturing States, where low energy prices are fueling
    growth and attracting new jobs.
        According to one study, modernizing North America's energy
    infrastructure could, in fact, support an average of 432,000
    jobs per year through 2035. Despite the recent decline in oil
    prices, there continues to be many job opportunities for
    trained workers; but the key word here is trained.
        One industry study estimates that there will be 600,000
    career opportunities for men and women and minorities in energy
    in the years ahead. We need to ensure that necessary education
    and job training is available for all Americans.
        Our energy potential makes us more secure here at home and
    more powerful abroad. We can diminish the political influence
    of other energy exporters like Russia and Iran, and help many
    of our allies, who would much rather buy their energy from the
    U.S. But it will only happen if energy security and
    geopolitical benefits become a part of our policy
    decisionmaking.
        Dr. Moniz, we have a wonderful opportunity of working
    together to fulfill our tremendous energy potential.
        And I yield back.
        Mr. Whitfield. The gentleman yields back.
        [The prepared statement of Mr. Upton follows:]

                     Prepared statement of Hon. Fred Upton

        Secretary Moniz, welcome back to the committee. I hope that
    today's discussion is just one of many with DOE on creating a
    21st century energy policy. The areas of disagreement between
    Republicans and the Obama administration often get most of the
    attention. But while our differences remain, I'm one who will
    always look for areas of agreement--areas of common ground on
    an energy policy that can benefit all Americans.
        We have seen a tremendous increase in oil and natural gas
    production here in the U.S. and across North America. We are
    already seeing the benefits of abundant and affordable energy--
    at the gas pump, in our power bills, and with the creation of
    new jobs.
        But for more Americans to see even more benefits, we need
    to move beyond decades-old energy scarcity policies. We need to
    maximize the benefits of North American energy. At the
    committee, we call this building the Architecture of Abundance.
        The first step is to upgrade and modernize our energy
    infrastructure. The new energy coming online is of no use if we
    can't deliver it to consumers and businesses. We need a modern
    and more resilient infrastructure to safely and responsibly
    maximize our growing oil and gas output. Our bipartisan
    pipeline safety legislation was an important milestone, but
    there's more work to do. We also need to ensure that our
    electric grid can meet the challenges of the future, everything
    from advanced grid technologies to protecting against weather
    events or physical and cyber security threats.
        America's energy abundance is also proving to be a powerful
    jobs creator. Not only in places like Texas and North Dakota
    where production is booming, but also in Michigan and other
    manufacturing states where low energy prices are fueling growth
    and attracting new jobs. According to one study, modernizing
    North America's energy infrastructure could support an average
    of 432,000 jobs per year through 2035.
        Despite the recent decline in oil prices, there continues
    to be many job opportunities for trained workers. But the key
    word here is ``trained.'' One industry study estimates that
    there will be 600,000 career opportunities for women and
    minorities in energy in the years ahead. We need to ensure the
    necessary education and job training is available to all
    Americans.
        Our energy potential makes us more secure at home and more
    powerful abroad. We can diminish the political influence of
    other energy exporters like Russia and Iran, and help many of
    our allies who would much rather buy their energy from the
    United States. But it will only happen if energy security and
    geopolitical benefits become a part of our policy decision-
    making.
        Let's not lose sight of the opportunity to turn America
    into an energy superpower and the bipartisan efforts that will
    help us get there. Dr. Moniz, we have a unique opportunity to
    work together as we look to fulfill our tremendous energy
    potential.

        Mr. Whitfield. At this time I would like to recognize the
    gentleman from New Jersey, Mr. Pallone, the ranking member, for
    5 minutes.

    OPENING STATEMENT OF HON. FRANK PALLONE, JR., A REPRESENTATIVE
                IN CONGRESS FROM THE STATE OF NEW JERSEY

        Mr. Pallone. Thank you, Chairman Whitfield and Ranking
    Member Rush.
        I just want to welcome Secretary Moniz back to the
    committee. This is not the easiest time to be the Nation's top
    energy official, but I would venture to say that you are
    proving yourself to be one of the better secretaries we have
    seen.
        The President's fiscal year 2016 budget would fund the
    Department of Energy at $29.9 billion, an increase of $2.5
    billion, or up 9.2 percent from fiscal year 2015 level. And the
    budget would increase funding for important national
    priorities, including energy efficiency and renewable energy.
    Additional policy and funding priorities which are designed to
    improve electric grid reliability, reduce methane pollution,
    and enhance U.S. economic and energy security include energy
    infrastructure, technology and research to accelerate energy
    technologies through the development of transformational
    technologies.
        The President's budget would also fund cleaner fossil fuels
    as well as post- and pre-combustion carbon capture and
    compression technologies. And very importantly, the budget
    would adequately fund the Department's critical defense-related
    activities and add $305 million to strengthen DOE's protections
    and defenses against cyber attacks and improve energy sector
    cybersecurity.
        I support this budget because it takes the next logical
    steps in an already highly coherent energy strategy, which has
    greatly diversified our energy sources, generated significant
    efficiency gains and substantial reductions in demand, and, of
    course, lowered prices at the pump to levels that American
    drivers and households have not seen in many years.
        Closer to home, I want to particularly commend the work
    done last year, and would continue under this budget, with
    regard to the Northeast Regional Refined Product Reserve. My
    district in New Jersey was one of the hardest to have been hit
    by Superstorm Sandy, and the lack of access to gasoline made a
    terrible situation even worse. The gasoline reserve will help
    ensure we are ready in the future. In my opinion, the gasoline
    reserve and the Department's efforts to address the resiliency
    and reliability of our electric grid, natural gas transmission
    and distribution systems, and other energy infrastructure, are
    critically important to not just my district, but also to the
    Nation as a whole.
        In short, this budget continues to build towards a true,
    all-of-the-above energy strategy that addresses supply, demand,
    and security. It builds on the progress made toward realizing
    the goal of creating a low-carbon, clean-energy economy that
    can be the engine of growth for decades to come, and so I
    support it enthusiastically, and I look forward to hearing more
    from the Secretary.
        I yield back, Mr. Chairman. Thank you.
        Mr. Whitfield. The gentleman yields back the balance of his
    time.
        That concludes the opening statements. And so at this time,
    Secretary Moniz, you are recognized for 5 minutes for your
    statement.
        And welcome again. We appreciate your being here.

        STATEMENT OF THE HON. ERNEST J. MONIZ, SECRETARY, U.S.
                          DEPARTMENT OF ENERGY

        Secretary Moniz. Thank you.
        And Chairman Upton and Whitfield, and Ranking Members
    Pallone and Rush, members of the committee, I really appreciate
    the opportunity to come and discuss our budget with you, and I
    also appreciate your flexibility with regard to scheduling of
    the hearing.
        Over the last 6 years, as has already been said, the U.S.
    has become the world's number one producer of oil, liquid
    fuels, natural gas; and now, in fact, our net imports of crude
    oil end products is below 5 million barrels a day, quite a
    remarkable place to have come in this period.
        The EIA estimates that just in gasoline alone, the average
    household will be saving $750 in 2015, and there are other
    savings as well in the energy sector.
        I have submitted an extensive submission for the record, so
    I am going to be very, very brief in these remarks so that we
    can move to questions. I will just emphasize a few points. One
    is, this economic growth that we are enjoying, the energy boom
    that we are enjoying, has come even as we continue to decrease
    greenhouse gas emissions.
        Secondly, that we are committed to an all-of-the-above
    energy strategy, and we will continue to do that through a
    whole raft of lower-cost, clean energy technologies, in fossil
    energy, energy efficiency, sustainable transportation,
    renewable energy, nuclear energy, and, well, energy efficiency
    I mentioned.
        I will also add that in addition to focusing on the supply-
    and-demand sides of the equation, that we are, as you know,
    very, very much focusing on energy infrastructure, and we hope
    to have our quadrennial energy review available within weeks,
    as opposed to months of time. And, of course, with your
    framework focusing on infrastructure, we look forward to that
    discussion.
        I will just end with noting, as Mr. Pallone did, that, of
    course, our role is not limited to energy. One of our very
    important roles as well is in providing a good piece of the
    backbone for the American basic research community through our
    science budget. We have requested $5.34 billion for science,
    about 5 percent over the appropriation.
        I do want to say that the science program continues to be
    very successful in, for example, completing large projects. I
    was at Brookhaven on Friday dedicating a huge light source, a
    billion dollar project, on budget and ahead of schedule. And in
    this budget request, we will build yet additional facilities.
        In addition, we have, of course, a major national defense
    responsibility, specifically nuclear security; and there again
    we have I think a strong request of $11.6 billion for the
    National Nuclear Security Administration, approximately a 10
    percent increase over the fiscal year 2015 appropriation, very
    importantly continuing a science-based approach to the
    deterrent and helping to control dangerous nuclear materials
    globally.
        Finally, environmental management, our fiscal year 2016
    budget request is for $5.8 billion, approximately equal to the
    2015 appropriation, although up significantly from our request
    of last year.
        It is worth noting, because we clearly have some very
    challenging projects there, but it is worth noting that over
    the years DOE has cleaned up over 85 percent of its sites and
    90 percent of the land area, but again significant challenges
    remain, and we think we can make good progress in fiscal year
    2016.
        I think those really are the remarks I would just make to
    open up the discussion because I think our ability to discuss
    this will be much more valuable.
        Thank you, sir.
        Mr. Whitfield. Mr. Secretary, thank you very much, and we
    appreciate that opening statement.
        [The prepared statement of Secretary Moniz follows:]
        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Mr. Whitfield. At this time, we will begin the questions,
    and I would recognize myself for 5 minutes.
        Mr. Secretary, I am not going to talk today about proposed
    regulations on existing coal plants, but I do want to focus for
    a moment on the proposed regulations for the new coal power
    plants. And I want to do that because in December of 2010, the
    Department of Energy reported that it had seven potential CCS
    demonstration projects for coal power plants.
        Three of those plants were estimated to startup in 2014,
    three in 2015, and one in 2016. Now, I am assuming that EPA and
    DOE had a lot of conversation with each other because, as you
    know, EPA in their proposed regulations for the new plants set
    guidelines, and they focused on the Kemper plant in
    Mississippi, a proposed plant in Texas, one in California, and
    one in Canada. And the one in Texas has not began operation,
    has not even started construction, nor in California. There is
    a small one up in Canada.
        But the Kemper plant, of which these emission standards
    were developed, looking at the projected emissions from Kemper,
    this is a plant that is 2 years behind schedule, billions of
    dollars over budget. And of those projects that DOE talked
    about in 2010, three of those projects have been cancelled,
    three of the remaining four projects are now estimated to begin
    operation in 2019 or 2020, if at all. And yet EPA sets a
    standard, an emissions standard, based on projected emissions
    from some pie-in-the-sky CCS plant that is built so that you
    can use CCS for enhanced oil recovery.
        And this morning I had a meeting with the Applied Energy
    vice president at the University of Kentucky, who had just come
    back from China, where they are tearing down old coal plants
    but building new coal plants using supercritical technology
    like the one at the Turk plant over in Texarkana, Arkansas,
    which is the newest plant in the U.S., which was built before
    this proposed regulation comes out.
        So here we are in America, finding ourselves not able to
    build a new plant using the best technology because of some
    fathomable emission standard set by EPA. And I was just
    curious, has EPA, Ms. McCarthy or others, have they talked to
    you all about this and the state of commercially viable CCS
    technology?
        Secretary Moniz. Mr. Chairman, so first of all, as with
    lots of rules across the government activities, the Department
    of Energy does often provide technical support when it is not
    our responsibility to implement a certain rule or regulation.
        With regard to carbon capture and sequestration, I think it
    is very important to keep in perspective the proposed rule and
    what our demonstration projects are, because they are different
    levels of ambition in a certain sense.
        First of all, there is no question that all of the
    technologies have been demonstrated, including in an integrated
    fashion, for example in the Boundary Dam project in Canada to
    which you referred, and for both coal plants and for industrial
    plants, there are other large projects coming onboard.
        But I think a very important point is we are, as is
    appropriate for the Department of Energy, our projects are
    really trying to push the edge. So all of our projects are
    looking at 90 percent capture, et cetera. If you look at the
    rule as proposed, for example, building an ultra supercritical
    coal plant with carbon capture, with that proposed rule, would
    require only 30 percent capture. That is a very, very different
    level of challenge than the projects that we are putting
    together.
        We will be seeing--you are absolutely right that some of
    the projects are delayed. We will be seeing a good portfolio
    deployed, but you are also correct that some of the projects
    will not come online, and partly it is because of litigation
    and other issues, and the ARRA funding deadline coming in this
    year.
        But, again, the key point is if one were to go out right
    now to build an ultra supercritical plant, and they exist, and
    use conventional capture there, one is talking only about 30
    percent.
        Mr. Whitfield. Well, I might just say that the experts in
    the utility industry say that it could not be done in a
    commercially viable way where they can be competitive. And I
    think the EPA in its extreme regard of this regulation is
    really diminishing our opportunity to be competitive and have a
    reliable electricity source.
        At this time I would like to recognize----
        Secretary Moniz. I would be happy to come by and talk about
    some of this in more specific detail in terms of, especially
    the ultra supercritical route.
        Mr. Whitfield. Yes, well, we will take you up on that.
        At this time I recognize the gentleman from Illinois, Mr.
    Rush, for 5 minutes.
        Mr. Rush. I want to thank you, Mr. Chairman.
        Mr. Secretary, I have a lot of questions that I want to
    cover, but unfortunately I do not have the time to do it all
    this afternoon, so I will be reaching out to your office to
    schedule a meeting where we can more fully discuss some of the
    priorities that I have already outlined.
        That said, Mr. Secretary, my office is contacted frequently
    by business owners and entrepreneurs who would like to access
    DOE loans, grants, and/or anything technology transfers from
    the national labs. Many of these entrepreneurs tell us they
    cannot access these resources either because they don't know
    the right people, don't have the right connections, they don't
    fully understand the process, or in some cases they might just
    be intimidated by the very same process.
        Mr. Secretary, in addition to helping women, minorities,
    veterans, and other underrepresented groups access employment
    in the private sector through outreach and skills training, I
    would also like to work with you to establish outreach policies
    to educate the public on accessing DOE loans, grants, and
    technological transfers.
        It is important that we demystify these processes so that
    all Americans can benefit from these extraordinary resources
    that DOE possesses. Do you agree, and do you have any
    preliminary thoughts on how we might educate the public to make
    these resources, these loans, grants, transfers, more
    accessible?
        Secretary Moniz. Thank you, Mr. Rush.
        And thank you again for your support of the Minorities in
    Energy program, including being there at the beginning and the
    1-year anniversary.
        In terms of the access to the labs and the transparency,
    you know, that is a very important issue. We are working on
    that. Actually, we can provide you some background material,
    for example, on some of the Web sites that we have created, for
    example, looking at financing opportunities for business. But
    we have more to go, a longer way to go.
        Just today, literally this morning, we were able to
    announce a new group that we are putting together, a new
    office. It is called the Office of Technology Transitions. And
    that office's role is precisely to address the transparency and
    access to technologies that are in our laboratories that we
    want to get out as well, and have a larger customer base for it
    if you like.
        Importantly, and I do want to note this very clearly, in
    the 2005 Energy Policy Act, the Congress authorized a 0.9
    percent of applied energy R&D fund for commercialization. Up to
    now, that has been satisfied by the existing cost-shared CRADA
    agreements. Today I announced that we are going to move forward
    and actually create that as a separate fund, a technology
    commercialization fund, that will be run out of this Office of
    Technology Transitions by our technology transfer coordinator.
    It will seek at least 50 percent matching funds--it can always
    be waived in special circumstances--but that would be the norm,
    and making that system transparent. Allowing access to medium
    and small business as well as large businesses will be part of
    the goal.
        Mr. Rush. Mr. Secretary, you have done such a remarkable
    job during your tenure in establishing the Minorities in Energy
    Initiative and the Jobs Strategy Council. Do you think that we
    should look at some of your best practices and begin to codify
    some of those in law? That is the first question.
        And the second question, if you have an opportunity to
    answer this, is do you think that this $29.9 billion budget
    that you are seeking, is that enough to do the work that you
    are required to do in this particular area?
        Secretary Moniz. Well, I think the budget request is a very
    good one, and one in which we can move forward in the areas
    that you have said, but it will take, frankly, continued
    commitment at the top of the Department, and I don't mean only
    me. I mean a lot of other of the leadership of the Department.
        And as far as best practices go, there are several to draw
    upon. One, we mentioned earlier the tremendous development in
    the oil and gas sector, for example, in the United States. And
    here I will say working together with API, the Petroleum
    Institute, it has been terrific in that we have had, I think,
    now about a half-dozen workshops jointly focusing on attracting
    minorities into the many job opportunities in that area. That
    is one example.
        Another example, a person we brought on board last June
    named Dave Foster is really the point person on the whole jobs
    strategy. And so combining Minorities in Energy, women in clean
    energy, job strategy, the situation in our energy world right
    now, the very fortunate one, I hope we can make some real
    progress in the next 2 years. We need the talent.
        Mr. Whitfield. The gentleman's time is expired.
        At this time I recognize the gentleman from Michigan, Mr.
    Upton, for 5 minutes.
        Mr. Upton. Thank you again, Mr. Chairman.
        On Monday, as you know, Mr. Secretary, this committee
    released a legislative framework for compiling a solutions-
    based energy package in this Congress. And it consisted really
    of four areas: Modernizing infrastructure, 21st Century energy
    workforce, energy diplomacy, and efficiency and accountability.
    And we do want to make sure that we coordinate this closely
    with our Senate counterparts, and also working with the
    Department of Energy. And we welcome the constructive
    engagement in those areas, and appreciate the discussions we
    have had thus far.
        Also, know that the Department is preparing for the release
    of the first quadrennial energy review, QER, focusing on energy
    transmission, storage, and distribution. And we further
    understand that the effort will include some legislative
    proposals to Congress, which should complement the effort
    underway before this committee. And while we have not yet
    received your recommendations, we look forward to working with
    you, reviewing those in a timely manner to find agreement of
    common interest. I appreciate that willingness.
        Recognizing that the legislative process is about give and
    take, we hope that you will be open to our ideas as we seek
    solutions to permitting challenges and infrastructure
    bottlenecks to resolve those. We also think that it is
    important to think about ways how we can use our energy
    resources, and the Department's role in securing resource
    development as a source for global good.
        And I know that you have been personally involved for many,
    many months, in discussions with our allies in Eastern Europe
    and around the world, our partners in Canada and Mexico, and I
    wonder if you might expound on those in the remaining time that
    I have? Some of those----
        Secretary Moniz. Certainly. Thank you.
        And first of all, let me again assure you publicly of what
    we have discussed privately, that we look forward to working on
    the framework that you have put forward. All of those issues
    are very dear to what we are doing, especially the
    accountability of Congress that was in that fourth part.
        Mr. Upton. You don't have to worry about us.
        Secretary Moniz. With regard to the international events, I
    will mention two of those, yes. One is Ukraine, you effectively
    alluded to, and our people, led by our emergency response
    people, but bringing in others, Red Cross, FEMA; Canadians have
    been very helpful, we have sent teams over to Ukraine now three
    times. Our teams, I want to emphasize, did not write the Energy
    Winter Contingency Plan for Ukrainians, but led them through
    the process of how to do that; and they wrote an energy
    contingency plan.
        It also identified correctly the problem that there was
    going to be with coal, for example, this winter, and some other
    problems. So that has been very, very well appreciated. The
    Ukrainian Government is asking us now to do more, which we had
    a fact-finding group go there a week before last. They would
    like training, they would like to know how to manage emergency
    response. They want to know about energy modelling. These are
    all, I think, very helpful tools for them. But that is where I
    think we will need some discussion with the Congress and other
    parts of the administration as to how we can respond to that.
        With regard to North America, in December we had a very,
    very, very positive trilateral energy ministerial with Canada
    and Mexico. One result is we agreed that we should do it every
    year at least, which is progress. But, for example, we signed
    an MOU that we have already launched the work on through our
    Energy Information Administration on data, energy data
    integration. We really don't have a lot of data integration
    across the borders, or in some cases the same data. It seems to
    be different. So that is just one example.
        I will mention a very interesting example. In the
    trilateral, our Mexican colleagues, Minister Joaquin Coldwell
    in particular, gave us an extensive briefing on energy reform
    in Mexico. And while there has been a lot of focus on the
    hydrocarbon part, they want to emphasize the reform on the
    electricity sector is equally ambitious, and will open up many
    more collaborative possibilities. In fact, they said more
    electricity integration is something that Mexico would like to
    work with us very, very closely.
        So I think those are two areas of some of our international
    work, different in character, but both very important.
        Mr. Upton. Great. Thank you.
        Yield back.
        Mr. Whitfield. The gentleman yields back.
        At this time I recognize the gentleman from California, Mr.
    McNerney, for 5 minutes.
        Mr. McNerney. Thank you, Mr. Chairman.
        I want to thank you, Mr. Secretary, for coming in. It is
    always a pleasure to have you testify in front of the committee
    here.
        Secretary Moniz. Thank you.
        Mr. McNerney. As I look over the budget numbers, I am very
    happy to see a large increase in the electricity delivery and
    energy reliability categories. One of my colleagues, Ms.
    Ellmers, and I are working together on grid technology. And I
    just want to ask what the Department can do to translate all
    that it has learned about smart grid investment grants and
    smart grid demonstration projects into actionable information
    for electricity providers.
        Secretary Moniz. Thank you.
        I can assure you also the quadrennial energy review coming
    out will have a major focus, of course, on the electricity
    grid, as does our budget. We have a $356 million proposal for
    the whole-grid modernization approach, so that will have many,
    many aspects.
        Part of it will be developing more of the essential
    technologies, like the high-power electronics, wide-band gap
    semi-conductors, et cetera, et cetera. Part of it will be a
    system analysis. Part of it will be further integration. You
    alluded to the data. So, for example, with the ARRA funding,
    one of the major programs was to really deploy well over 100
    syncrophasors to really let us know what is going on in the
    high-voltage grid. Now integrating that information into
    actionable, precautionary actions will be part of this.
        But also another part of it is--actually, we have two
    different programs, but one specifically here--we also propose
    a State planning grant program. It is about $27 million we
    propose for grants to States to plan for reliability and how
    they will be doing integration. That, of course, in turn could
    lead to subsequent proposals for actual projects to implement
    microgrids, distributed generation, other kinds of IT-based
    technologies.
        Mr. McNerney. I am looking forward to working with your
    Department on that and with my colleagues.
        Fusion, what do we have in the next budget for fusion
    energy? And you know, this is an area I think a lot of good
    future potential, but it is not in the immediate future.
        Secretary Moniz. I regret I have the same answer as last
    year, which is that I am recused from fusion. That recusal ends
    in May, so if you would like to ask me the question in June, we
    could come back. But seriously, perhaps our deputy secretary or
    our under secretary could come and visit you about that.
    Because I am recused from all decisionmaking in the fusion
    program.
        Mr. McNerney. OK. Fair enough.
        So about the smart grid technologies, what do you think are
    some of the barriers to improving our grid technology and
    reliability then, given where we are today?
        Secretary Moniz. Well, on the high voltage side, the high
    voltage grid, I think one of the issues, as I already
    described, was this issue of now being able to use the new data
    that we are getting from these new kinds of sensors. But a lot
    of the action is really going to be on the distribution side. I
    think that is where a lot of the imbedded intelligence has to
    be. That is key to starting to bring in distributed generation,
    maybe distributed storage.
        Mr. McNerney. So you think we are going to have to put
    incentives out there for the local distribution networks to
    move forward on this?
        Secretary Moniz. And so, that is a very good point. I was
    going to end with, of course, we can help on the technology
    side; but the regulatory authority for that, of course, will
    rest with the States. So that is where we need a potential
    State-Federal partnership. That is where those planning grants
    can come in, where we will give a grant to States, to the State
    Energy Offices, to see what they need to do for their smart
    grid, and then we will see if there is some possibility of our
    working with them to implement it.
        Mr. McNerney. Well, I am also happy to see energy
    efficiency and renewable energies move forward with this
    budget. Very important for our Nation's energy mix to have
    those as a significant and reliable part.
        Secretary Moniz. Thank you.
        Mr. McNerney. I just want to ask the chairman to consider
    that developing carbon sequestration technology is going to be
    beneficial to the coal industry, because as climate change
    progresses there is going to be a larger outcry to stop
    producing carbon dioxide. So this is something that is going to
    benefit the coal industry. We are not out to hurt the coal
    industry with carbon sequestration technology.
        I yield back.
        Mr. Whitfield. Thank you.
        The gentleman yields back.
        At this time I recognize the gentleman from Illinois, Mr.
    Shimkus, for 5 minutes.
        Mr. Shimkus. Thank you, Mr. Chairman.
        Mr. Secretary, welcome.
        Secretary Moniz. Thank you.
        Mr. Shimkus. Are these the DOE labs that have high-level
    nuclear waste: Oak Ridge, Savannah River, Idaho Labs, and
    Hanford? Are there any more, in significant amounts?
        Secretary Moniz. In significant amounts, I think those are
    the main ones, actually and principally, Idaho, Hanford, and
    Savannah River, yes.
        Mr. Shimkus. While I was at Oak Ridge they----
        Secretary Moniz. Oak Ridge also has, yes.
        Mr. Shimkus. You have promised me numerous times that you
    as Secretary would continue to follow the law of the land. Is
    that still true?
        Secretary Moniz. It always has been true.
        Mr. Shimkus. Great. OK, good, we are on the right track
    here.
        Secretary Moniz. And the Constitution.
        Mr. Shimkus. So, in your budget justification, you have $3
    billion to move to a pilot interim storage plan. Do you agree
    that that would require a change in law? Do you not?
        Secretary Moniz. Certainly not to begin to discuss consent-
    based processes, et cetera.
        Mr. Shimkus. But the Nuclear Waste Policy Act is a law
    signed----
        Secretary Moniz. So we----
        Mr. Shimkus. So the use of this money would not be with the
    intent of the law, because the law says that--it doesn't give
    the DOE the authority or the responsibility to go into a pilot
    interim storage.
        Secretary Moniz. To site such a facility would require
    further legislation.
        Mr. Shimkus. Thank you.
        Secretary Moniz. I would note, of course----
        Mr. Shimkus. Well, let me just go on.
        Secretary Moniz. OK.
        Mr. Shimkus. So you have $3 billion. You also mentioned
    $5.7 billion is outlined to maybe do this, which would require
    a change in law, but--and I made this point, I think, last
    year--the administration needs to appreciate that there is a
    change occurring in the State of Nevada.
        We recently had one Member elected who said that if it was
    proven that Yucca Mountain would be safe, then he would support
    it. That is public record. Now that the NRC has finished its
    safety and evaluation report, it said that Yucca once closed
    would be safe for a million years.
        So we are in a new world now than we were before. And just
    for public record, $3 billion or $5.7 billion could be very
    helpful in the State of Nevada transitioning to--restarting and
    opening Yucca Mountain, and also an interim, pilot interim
    storage site. So I just put that on the record.
        We have also heard that it is also required by DOE under
    the law to do the environmental impact statement. Is that not
    correct?
        Secretary Moniz. We have----
        Mr. Shimkus. The answer is yes.
        Secretary Moniz. We have responded to every request and
    order from the NRC, including providing the information that
    they needed for the----
        Mr. Shimkus. But you are not doing it?
        Secretary Moniz. We have no----
        Mr. Shimkus. It is your responsibility under the law to do
    the environmental impact statement. And what is going on now is
    the NRC is going to do it with the money remaining because of
    the failure of DOE to the final EIS.
        Secretary Moniz. No. We have responded completely to NRC's
    request.
        Mr. Shimkus. OK. We will just agree to disagree.
        As the NRC moves forward with adjudication of the license
    application, assuming that the funds are made available for the
    purpose, will you commit to following the law and defending the
    application DOE has submitted?
        Secretary Moniz. I must point out that the NRC also pointed
    out that we do not have the authorities in terms of land and
    water, for example, for Yucca Mountain. Which goes right back
    to the consent-based process. Without a consent-based process,
    we continue to think----
        Mr. Shimkus. But the question is, under the law you are
    required to defend the application. Are you willing to follow
    the law and defend the application?
        Secretary Moniz. I will have to check with the exact
    aspects of the law on that. I know the DOE was required to
    submit the application.
        Mr. Shimkus. OK. The last time we tried to visit Yucca, DOE
    gave us a lot of trouble. We are going back this year. I hope
    you will give us all opportunity and make it easy for us to get
    there and get the door open.
        Secretary Moniz. I wasn't aware of that. I apologize for
    that.
        Mr. Shimkus. No, no. OK. And then finally in your budget,
    FutureGen 2.0, obviously that money was pulled. That was the
    retrofitting of the plant in Meredosia and then the carbon
    capture sequestration issue in Morgan County, Illinois.
        I just make that point obviously because it is Illinois,
    and that is a traditional DOE project from the original
    FutureGen to now FutureGen 2.0 to pulling it away. It just adds
    to what--those of us from coal areas of the country are
    concerned that as we ramp up these environmental rules and
    regulations, we really shut down coal-fired generation, and
    that is major base load activity, which we as a country just
    can't sustain the loss of that power.
        So with that, thank you, and I look forward to working with
    you.
        Secretary Moniz. Mr. Chairman, may I just comment?
        Mr. Whitfield. Yes.
        Secretary Moniz. Make two comments if I may? I think it
    might be helpful. One is, first of all, in your opening
    statement, Mr. Shimkus, in terms of the four DOE sites, I would
    just note, of course, those do not have commercial spent fuel.
    It is high level waste.
        Mr. Shimkus. Which doesn't make it any less safe. Where is
    that supposed to go?
        Secretary Moniz. So if I may just say that there is no
    resolution yet.
        Mr. Shimkus. Well, no. There is a resolution. It is
    supposed to go to Yucca Mountain. That is where it is supposed
    to go.
        Secretary Moniz. Last fall we completed a study, and it is
    on our Web site, requested by the Blue Ribbon Commission, in
    terms of looking at the issue of whether there should be
    separate pathways. That remains a decision to be reached.
        With regard to FutureGen, let me just say that I think the
    FutureGen project, an oxycombustion plant with deep saline
    aquifer storage, is very, very important; and unfortunately,
    that funding was from the Recovery Act. The date of expending
    the funds is upon us, so the project could not meet that, and
    with regret we are in the structured closeout.
        I do want to say we will preserve the IP, and we will
    preserve the asset of the pour space that we have purchased in
    Illinois.
        Mr. Shimkus. Thank you. I will just say the Blue Ribbon
    Commission is not an elected body, and they were told
    specifically not to consider Yucca Mountain.
        Mr. Whitfield. At this time I will recognize the gentlelady
    from California, Ms. Capps, for 5 minutes.
        Mrs. Capps. Thank you, Mr. Chairman.
        It is always a pleasure, Mr. Secretary, to have you come
    before our committee.
        Secretary Moniz. Thank you.
        Mrs. Capps. And today was no different.
        And I want to start with a premise which I hope we can all
    agree upon. And that is the fact that climate change is real,
    and it is a serious threat to our Nation and to our planet.
    While we are already seeing and paying for the impacts of
    climate change, we do still have a chance to mitigate some of
    the long-term damages.
        We need to act now, however, to reduce carbon pollution and
    move toward a clean, sustainable energy future. This will
    require significant American innovation and investment. And I
    know the Department of Energy and this administration is
    committed to it. While this is not easy, I believe we have some
    of the best innovators in the world, and that we are up to that
    challenge, but they cannot do it on their own.
        The Federal Government does play an essential role in
    driving the research in development of these technologies, and
    this is something I have seen firsthand in my district.
        And I want to ask you about two of the projects that come
    out of your administration that are being developed through the
    University of California in Santa Barbara, have applications
    there.
        One of them that was one of the first, Frontier Energy
    Research Centers, designated by your Department in 2009. And
    since then, this center has made very significant advances in
    key energy technology, some of which we use every day, like
    photovoltaics and LEDs. In your testimony you say that the
    Energy Research Center's program is DOE's flagship--this is a
    quote--flagship investment in basic science that underpins
    future energy technologies. Music to my ears.
        Why is this program so important to DOE's efforts on
    climate change, and do you see this commitment remaining strong
    in the future?
        Secretary Moniz. Thank you.
        The EFRCs I think have been a tremendous success. I might
    say for the committee that originally there were 46 funded in
    2009, partly with Recovery Act funds. But it is worth saying
    this again, in a bipartisan spirit, that the setup for the
    EFRCs came from an exemplary process run by the Department of
    Energy during the Bush administration, several years of
    convening workshops of 1,500 scientists to define the key
    science challenges that underpin future energy technologies.
        They have been tremendously successful. With the ARRA
    funding falloff, regrettably we have had to lower the total
    number. But in fiscal year 2016, we are proposing a 10 percent
    increase to be able to get a few more of those operating. They
    have been tremendously successful, and I think are very
    important for the future of clean energy in this country.
        Mrs. Capps. And that leads me right into my second
    question, because while some marketplace applications are
    already there, it is so essential that these come out of the
    lab setting, out of research institutions, and get into our
    economy and help to build that economy in the right direction.
    And that is why I was so pleased to see the increase in your
    budget.
        ARPA-E provides essential research and development funding
    from the government, but the part we need to stress even more
    is the generation of private funds that have already and will
    continue to drive our economy. Will you elaborate on this?
        What is the ratio between I call it startup funds that come
    from the Federal Government, and how does that impact the
    private sector? Because that is what motivates me when I see it
    becoming an economic driver right in my congressional district.
        Secretary Moniz. First of all, the ARPA-E program is
    another example of, I think, a tremendously successful program.
    And we have requested an increase from $280 to $325 million.
        By the way, the ARPA-E Summit is going on as we speak out
    at the convention center, and I was there this morning. And it
    is just remarkable technologies. And I would like to say here
    that we have some first discussions going on about potentially
    bringing to the Congress an exhibit of some of the ARPA-E
    technologies. I think it would be a great science fair for us
    to have here.
        In terms of the impact, the fifth anniversary of the first
    ARPA-E contract will be coming up in March. So now that we are
    at the 5-year mark, what we are seeing is a lot of these
    projects getting into the marketplace. Big leverage in terms of
    investment. I know one class of projects just drew in $800
    million of financing. But, also, five of the projects now have
    been essentially bought by much larger strategic investors. For
    example, a big American defense firm just took that. So these
    are becoming into the marketplace 5 years. That is a pretty
    good track record.
        Mrs. Capps. Chairman, I am going to yield back.
        But I think that was a very practical suggestion. It would
    be interesting to work with the Science Committee to see if
    there could be some kind of demonstration here----
        Secretary Moniz. Yes.
        Mrs. Capps [continuing]. On Capitol Hill for what we are
    doing.
        Secretary Moniz. If I may just, we had last fall, I
    thought, a very successful--I think some of you may have come--
    a very successful lab day, where we showed results out at the
    laboratories. And I think now it would be nice to complement
    that with an ARPA-E day.
        Mr. Whitfield. Thank you, Mr. Secretary.
        And at this time I recognize the gentleman from Texas, Mr.
    Olson, for 5 minutes.
        Mr. Olson. I thank the chair and welcome Dr. Moniz.
        I want to start with a few thank yous, my friend. Thank you
    for going to India this past March and making exports of U.S.
    energy a top priority between India and America. Thanks for
    that. Very important back home.
        Also, thank you for the role your Department played in the
    Petra Nova project in the Parish power plant in my district,
    the first true carbon capture enhanced oil recovery operation
    in America that will be viable. Thank you for that.
        Secretary Moniz. And under construction.
        Mr. Olson. Yes, sir.
        Secretary Moniz. All right.
        Mr. Olson. My first question is about our national security
    infrastructure. It has been under attack. Last April, snipers
    shot up a Silicon Valley substation. In 19 minutes, they fired
    off rounds almost causing a blackout in Silicon Valley. Twenty-
    three pipeline companies have had cyber attacks. Your 2016
    budget doesn't address these attacks. You spend six times more
    on solar than secure power lines and secure pipelines. And I am
    sorry to put you on the clock, but in 1 minute, can you tell us
    your views on protecting our energy infrastructure, what is
    your role?
        Secretary Moniz. Yes. There are several things to say about
    that. It is a very important problem.
        Number one, the quadrennial energy review, first
    installment, on infrastructure will have a significant focus on
    resilience against multiple threats; extreme weather, cyber,
    physical, geomagnetic storms, which actually have occasionally
    hit the system. That is one point.
        Second point is, first of all, I want to thank the
    Congress. In the fiscal year 2015 budget, there was funding
    included for us to build out our emergency response center for
    the energy system so that we will have better situational
    awareness about threats to our system. We will be implementing
    that this year.
        Third, we have a substantial cybersecurity crosscut in the
    budget.
        Fourth, we convened, under the deputy secretary--it has
    been going on now for a few years--a very high level, a CEO-
    level electric utility group specifically on cybersecurity. And
    including the fact that we have granted security clearances to
    a select number of leaders so that we can go deeper into the
    threat space.
        Mr. Olson. Well, thank you. And thank you, that was 1
    minute exactly.
        My next question is about EPA working with you and FERC.
    EPA's regulations are closing many base-load power plants,
    mostly coal plants. And those that remain open may have to go
    offline at times for retrofits. Our grid will look very
    different in 2020. And there could be local brownouts, local
    blackouts. Some have complained that EPA is seeking advice on
    the impact of its rules after the fact and in a very ad hoc
    way.
        My question, sir, is will you object to creating a process
    where EPA consults with FERC and DOE as new air rules are
    written? Yes or no?
        Secretary Moniz. Well, the answer is ``yes'' in the sense
    that it happens. We provide technical assistance, and that is
    with both EPA and FERC.
        Mr. Olson. How about we create a formal process review of
    EPA, FERC, and you? Object to that? Because right now that
    doesn't exist. It is sort of informal. How about a formal
    process of review----
        Secretary Moniz. Well, I think we have to review specifics.
    But I think it happens now in the sense that certainly any rule
    that goes through OIRA and then goes out for agency comment, in
    addition to our direct technical consultation there. So I think
    I would have to look in terms of what enhancement would be
    being looked at. But I am certainly happy to have that
    discussion.
        Mr. Olson. OK. Thank you.
        One final question about a bill I had last Congress. It is
    a bipartisan bill with myself, Mr. Green, and Mr. Doyle. It
    guarantees that if a power plant is ordered to briefly run and
    exceed its permits during an emergency situation, that--this is
    under Section 202(c) of the Federal Power Act--other regulators
    can't interfere and shut them down.
        Your predecessor, Mr. Chu, said, ``Good bill.'' He supports
    it. I asked you last time you were here. You had just got here
    and hadn't looked at it. So you have had some time. Support the
    bill?
        Secretary Moniz. I am going to have to look at the bill.
    But this is about engaging----
        Mr. Olson. Power crisis permits----
        Secretary Moniz. Federal Power Act----
        Mr. Olson. Yes. We can find some----
        Secretary Moniz [continuing]. Authority.
        Mr. Olson [continuing]. Back in Texas--well, across the
    country, where there has been a power crisis, there has been a
    heat wave, a cold snap, there has been--plants have been
    ordered to stay online, exceed their emission permits. They
    have been sued. This bill stops that. This says if it is a true
    crisis, you can exceed your permits for 60 days and review it.
        Again, common sense, keep the power up, keep people cold in
    the summer and hot in the winter. Do you support the concept of
    having one voice, the power regulator decide what will run,
    what won't run?
        Secretary Moniz. Well, again, I think we will have to
    follow this up. But certainly the DOE has Federal Power Act
    authorities to order plants to run, at least for some period of
    time, to make sure reliability is there in a crisis. It is
    obviously something you don't want to use a lot. Frankly, it
    was used the last time I was here at the end of the 1990s in
    California. Secretary Richardson had to order some plants to
    run to avoid blackouts.
        Mr. Olson. And that is fine. But they have been sued. The
    power generator said keep that plant up and running. They were
    sued. Mirant in San Francisco got sued for doing what the
    regulators said to do. That is what this bill tries to stop.
    Let them keep the power up without penalty.
        Secretary Moniz. We will look at this and get back to you.
        Mr. Whitfield. The gentleman's time has expired.
        At this time I recognize the gentleman from Pennsylvania,
    Mr. Doyle, for 5 minutes.
        Mr. Doyle. Thank you, Mr. Chairman. Mr. Secretary, welcome.
    It is always a pleasure to have you here in front of the
    committee.
        Mr. Secretary, as you know, I have a keen interest in the
    National Energy Technology Lab for many reasons, but most
    especially because of the outstanding work that NETL is doing
    in implementing the mission of DOE's Office of Fossil Energy.
    The work of the NETL is critical to the people of southwestern
    Pennsylvania, as well as many other States in our entire
    Nation.
        Recently, a commission has been created. It is currently
    working to examine missions and effectiveness of DOE national
    labs, including the NETL. And, in fact, the commission is in
    Pittsburgh today as we speak, preparing to make
    recommendations, including privatizing the lab, which I think
    would be a huge mistake and unacceptable.
        Can you share with us your perspective on the efficacy of
    the NETL and what you see as the future for our national labs?
    Are there specific areas of concern that you have or have been
    brought to your attention? And I would like to say that I know
    we have had you in Pittsburgh several times, and we certainly
    appreciate it. But your schedule hasn't permitted you to
    actually visit the NETL in Pittsburgh.
        Secretary Moniz. Right.
        Mr. Doyle. And I would like to contact your office and
    reach out to you and see if we might be able to schedule a
    visit----
        Secretary Moniz. OK. Yes.
        Mr. Doyle [continuing]. To the lab in Pittsburgh. But could
    you talk a little bit about this commission?
        Secretary Moniz. Yes.
        Mr. Doyle. And any concerns you may have?
        Secretary Moniz. OK. I have been to the Morgantown site,
    but--I think I have another scheduled in Pittsburgh.
        Mr. Doyle. I am sure the gentleman from West Virginia
    appreciates that----
        Mr. McKinley. That is right. He was there. He was there.
        Mr. Doyle. But it doesn't do much for us in Pittsburgh.
        Mr. McKinley. That is right. So that is right. Yes.
        Secretary Moniz. The----
        Mr. Doyle. I mean West Virginia is so friendly to the
    administration, I can understand why you are there first and
    not in Pittsburgh.
        Secretary Moniz. OK. So NETL. Look, NETL is our fossil fuel
    laboratory--just no ifs, ands, or buts about it--and has done
    very, very good work in the carbon capture sequestration arena,
    in methane hydrates, and in some of the hydraulic fracturing
    environmental impact work, et cetera, et cetera. So its future
    is--we have a new director, of course, relatively new director.
    And I think she will do a great job.
        First of all, you mentioned privatize. And I don't know
    what this congressional commission will recommend. But I have
    made it very, very clear that we have no plans to change the
    organizational structure of NETL as the one of our 17
    laboratories that is a----
        Mr. Doyle. Right.
        Secretary Moniz [continuing]. That is a Federal
    organization.
        Mr. Doyle. I appreciate hearing you say that. Can you tell
    me--we know NETL has been playing a role in identifying and
    developing and deploying numerous technologies that increase
    efficiencies and reducing the environmental concerns from coal-
    fired plants, which is a big source of our electricity in
    States like Pennsylvania and others.
        Secretary Moniz. Right.
        Mr. Doyle. But if we are going to be serious about moving
    fossil energy research and development forward, I do have some
    concerns about the proposed DOE budget in 2016 for fossil
    energy. It seems to me that we need to establish scaled
    demonstrations of technologies that show our industry partners
    and the Nation that we have a serious commitment to this,
    specifically in areas of advanced combustion systems,
    gasification, advanced turbines, coal biomass to liquids, fuel
    cells, and rare Earth elements research. And much of this
    research, I should note, is being done in Pittsburgh at the
    NETL.
        I would really like to hear about your commitment to fossil
    energy R&D and where you see the role of this in America's
    energy portfolio and, also, to talk a little bit about the
    current status of DOE's CCS research, development, and
    demonstration efforts and what your agency is doing to develop
    a sustainable future for coal.
        Secretary Moniz. OK. There is many parts to that question.
        First of all, in terms of the commitment to advancing clean
    fossil fuel technology, clean coal technologies, again, I think
    we are demonstrably very committed. We are--we had a discussion
    earlier on the large integrated CCS projects, and I anticipate
    a good five of those will be fully successful and operating.
        We have right now opened an $8 billion loan guarantee
    program in fossil. And I can't talk about individual projects,
    but we are pretty happy with the proposal stream. I might
    note--this is not DOE, but in the fiscal year 2016 budget,
    there is the proposal for new tax credits, investment tax
    credits for CCS and a tax credit for sequestering
    CO2 . So that is very strong.
        Then, of course, we have our R&D program, which is in
    fossil energy and also in ARPA-E. We shouldn't forget ARPA-E
    also has programs in methane detection, carbon capture, et
    cetera.
        So it is a very, very broad program. You mentioned also
    rare earth elements. That is the study that the Congress asked
    for, I believe is within a 2 or 3 months probably about
    addressing the questions about whether or not coal ash, et
    cetera, is a viable source of rare warths. And I don't know the
    answer. If the answer is yes, then we should discuss how to
    implement.
        Mr. Doyle. Thank you, Mr. Chairman. I look forward to
    following up with you on the Pittsburgh visit.
        Secretary Moniz. Great.
        Mr. Whitfield. At this time I recognize the gentleman from
    Ohio, Mr. Latta, for 5 minutes.
        Mr. Latta. Well, thank you, Mr. Chairman.
        Thanks very much, Mr. Secretary, for being with us today. I
    appreciate your testimony.
        If I could talk a little and ask a few questions about the
    American Medical Isotopes Reduction Act of 2012. As part of
    that, the Department of Energy is to develop a program to
    assist in the establishment of the domestic production
    capabilities for medically vital isotopes like Mo-99--I think
    it is also pronounced ``moly 99.'' And that is used in nuclear
    medicine to perform life-saving procedures related to both
    heart disease and staging of cancer, two of the largest killers
    in our country.
        The motivation behind all of this was to address the fact
    that foreign production facilities that are scheduled to cease
    production in 2016. In the Western Hemisphere, the only place
    that is producing it is in Canada and, I believe, that they are
    going to be going out, unless something changes, I think, in
    2016 when that occurs.
        Then, as you look around the world where there might be
    production, in Europe I think there is five different
    facilities and one in Russia. I think there is one in--or two
    in South Africa and also in Australia. But, also, what this
    produces has a shelf life of only about 66 hours. So to get it
    from point A to point B to this country is vital to make sure
    that it is not degrading during that period of time, that it is
    not only 50 percent effective when it gets here.
        So I guess the first question is: When the supplier in
    Canada ceases its isotope production in 2016, what is the DOE
    doing to ensure that there isn't a shortage that would affect,
    I think, the United States using probably 50 percent of the
    world's isotope?
        Secretary Moniz. Well, as we continue to develop
    capabilities, one of the important developments in the last
    week was that Canada announced that it will maintain the
    capability until 2018 if required. So they have made that
    announcement. And without getting into too many specifics, we
    would work with them to see that that 2018 date could be met.
    And in the 2018 timeframe, then I think we are much more
    assured of continued isotope.
        Mr. Latta. Well let me ask this. OK. If we go from 2016 to
    2018, but at the same time is there the thought that the United
    States ought to be manufacturing it right here in the United
    States? And if that is the case, how long would it take from
    start to finish to be able to produce a facility that could
    produce that isotope?
        Secretary Moniz. Sir, I am going to have to get back to
    that in terms of exact timeline. I just don't have that----
        Mr. Latta. OK.
        Secretary Moniz [continuing]. On my fingertips, I am
    afraid. But we will get back to you on that.
        Mr. Latta. Because at the same time, if you could also get
    back on the whole question really if it is going to be longer
    than 2018, is there a way that this could be expedited to make
    sure that we don't have that----
        Secretary Moniz. Yes.
        Mr. Latta [continuing]. Shortage in the United States then?
        Secretary Moniz. Yes.
        Mr. Latta. It would be very, very helpful.
        Secretary Moniz. No. It is a very important point. And we
    will get back to you.
        Mr. Latta. Thank you.
        Switching gears a little bit, what legislation would be
    most helpful to the NRC to be able to quickly licensed a DOE
    developed gen-4 reactor? What is out there that we should be
    doing to get to that next level?
        Secretary Moniz. Well, I can't speak in detail for the NRC.
    But I think that their appropriated funding is quite modest, I
    believe. And it is a question of staff to get educated, trained
    in terms of alternative technologies.
        For some technologies, like the light water-based, small
    modular reactors, that is not as big a step away from the
    current regulatory basis. But if you start going into fast
    reactors or some of the more exotic molten salt reactors, you
    put your finger on a very important point. They need to get
    staffed up and ready to regulate such things.
        So it would be staff--presumably paid for either out of
    appropriations or out of some way of having the industry
    support them through some fee. I really don't know in detail,
    but that is, I presume, the only two sources that are possible.
        Mr. Latta. If I could just go back to your opening
    statement--because I didn't really see it in your written
    statement. And I tell you we take so many notes up here. But
    you were mentioning about the energy boom in this country.
    Would you attribute that energy boom especially to the
    advancements we have had in fracking in this country to be able
    to bring up that natural gas and oil that we have right now?
        Secretary Moniz. Oh, quite clearly. For gas and oil,
    hydraulic fracturing has been critical. We are still increasing
    our production in the Gulf of Mexico. But the big increases,
    certainly in gas, have been from hydraulic fracturing.
        Mr. Latta. Thank you very much, Mr. Chairman.
        My time has expired, and I yield back.
        Mr. Whitfield. The gentleman yields back.
        At this time I recognize the gentleman from New York, Mr.
    Tonko, for 5 minutes.
        Mr. Tonko. Thank you, Mr. Chair.
        And, Secretary Moniz, thank you for being here this
    afternoon. And more importantly, thank you for leading the
    Department with such vision and intellect. And your team is
    great to interact with.
        Secretary Moniz. Thank you.
        Mr. Tonko. I appreciate that.
        In general, I express my strong support for the research,
    development, and demonstration funding that is included in the
    budget request for this year. Innovation is indeed the fuel
    that will drive progress and create new industries and,
    therefore, new jobs.
        Mr. Secretary, wind and solar technologies are advancing at
    a rapid and steady pace. I fully support the increase in R&D
    for these and other renewable technologies. We hear a lot about
    wind and solar. We hear less about geothermal energy.
        I see that in the fiscal year 2016 effort, the
    administration is proposing a significant increase for work in
    this area, including funding for research and demonstration
    sites, dubbed FORGE. Could you expand, please, a bit on the
    goals for this funding and on the promise that this technology
    holds?
        Secretary Moniz. Well, first, in terms of the promise,
    engineered geothermal systems, hot rock systems, roughly
    speaking, have been looked at as having a promise in the United
    States of perhaps as much as 100 gigawatts of power. That came
    out of the 2005 report that the Department commissioned led by
    MIT, I might say. Not by me.
        So we are talking certainly many 10s to 100 gigawatts as
    the kind of range of potential. However, the scientific base
    has not been adequately laid. And that is what the FORGE
    project is to do, to have a highly instrumented experimental
    facility that can better do things like direct control
    fractures, et cetera, that are a huge part of how you engineer
    a geothermal system--an engineered geothermal system.
        Mr. Tonko. Thank you.
        And I am pleased to see that there is a proposed increase
    in funding for great modernization for the Office of
    Electricity Delivery and Energy Reliability.
        As you know, the electricity sector is undergoing a
    significant transformation, driven by a number of factors. I
    believe there is a Federal role in helping to smooth out those
    bumps in the road, so to speak.
        So, you mentioned the energy storage and integration work
    that the Department is doing in partnership with Southern
    California Edison. The budget proposal includes funds for State
    energy and reliability and the assurance grants. That is a new
    program.
        Will these grants be used for projects similar to the one
    that we have had with Southern California Edison?
        Secretary Moniz. Well, they certainly could be. But they
    will be broadly based and to individual States to determine.
    They will be planning grants, not project grants. But our hope
    is that the planning grants will lead to project grants. For
    example, in the QER we will specifically talk about how the
    State assurance plans that we have proposed could be
    essentially part of the--almost the requirements for then
    accessing other funds for projects.
        Mr. Tonko. Thank you. There are many aspects of the
    Department's portfolio that directly or indirectly address
    climate change. I would like to hear a bit more about DOE's
    proposed work to reduce methane emissions associated with
    natural gas development and delivery. It is an important
    emission that needs to be addressed. So is the Department going
    to explore some new activities here with those emissions?
        Secretary Moniz. Yes. In particular, we hosted five
    stakeholder round tables specifically on methane strategy last
    year. What I want to note is that our focus at DOE is not so
    much on the production end, it is on the mixed stream, if you
    like, so then the transmission pipes and then getting to the
    distribution systems.
        On the transmission pipe in particular, compressors are a
    big issue. We are looking at standards for compressors. And we
    are also funding new technologies for leak detection, for
    example. In fact, this morning at ARPA-E I saw a very elegant
    one. The ARPA-E, I believe, has right now 13 methane detection
    projects going on.
        Mr. Tonko. Now, are you doing this in partnership with the
    industry, the work on the emissions?
        Secretary Moniz. Well, the ARPA-E projects, many of them
    are being done by industry, typically small companies and some
    by universities.
        Mr. Tonko. And is it an effort that will require new
    technology, or is it just making an effort to----
        Secretary Moniz. No. It is new----
        Mr. Tonko [continuing]. Improve the technology we have?
        Secretary Moniz. It is novel technology to try to get
    effective, sensitive, inexpensive technologies. For example,
    the one I saw this morning out at the ARPA-E involved a novel
    use of carbon nanotubes to detect methane with high
    specificity.
        Mr. Tonko. OK. I yield back.
        Mr. Whitfield. The gentleman's time has expired. At this
    time I recognize the gentleman from West Virginia, Mr.
    McKinley, for 5 minutes.
        Mr. McKinley. Thank you, Mr. Chairman.
        I would like to follow up on the remarks that the
    congressman from Pennsylvania was talking about with NETL.
        And I just wanted to get maybe a little bit more specific
    with this. Because just in the next 2 years, Mr. Secretary,
    when you think about the facility in both Morgantown and
    Pittsburgh, maintaining the level of research, personnel, and
    all of their attributes of what they are doing, on a scale of 1
    to 10, what do you think it is going to look like 2 years from
    now? Be the same?
        Secretary Moniz. Well, I think in terms of scale it will
    probably be very, very, very much the same. Yes.
        Mr. McKinley. Is it like a 10? You think that there will
    be--it will be on the high level, that we can anticipate that
    that facility isn't going to change much in the next 2 years?
        Secretary Moniz. Again, it is not going to change in terms
    of organizational structure. It is going to, I think, be very
    comparable in size. But hopefully, when you look inside, you
    will see change, of course, as projects evolve. One of the
    things that we are doing right now----
        Mr. McKinley. OK. I just wanted to get----
        Secretary Moniz. Yes. OK.
        Mr. McKinley [continuing]. We can have a conversation----
        Secretary Moniz. Like I said, but the large-scale
    computation at NETL is being upgraded.
        Mr. McKinley. OK. Thank you.
        I noticed the other day that the administration--through
    DOE you had invested in some more projects in carbon capture in
    China. Is that accurate?
        Secretary Moniz. I am not aware of any specific project,
    no. We--in the----
        Mr. McKinley. There were clean coal projects there. I think
    it was carbon capture is what it was. But that leads to my next
    question.
        Secretary Moniz. I could be wrong. But I can look into
    that.
        Mr. McKinley. If you could.
        Secretary Moniz. But we do have--in the October agreement
    of Presidents Obama and Xi, it did say in there something that
    still remains to be designed that we would work together on a
    specific sequestration project instrumented.
        Mr. McKinley. So having said that, though, when I read
    that, it tipped off, then, where else--if we are investing
    money in clean coal or whatever energy projects in China, where
    else are we investing money----
        Secretary Moniz. No.
        Mr. McKinley [continuing]. Outside the United States?
        Secretary Moniz. If I may clarify. So we have a clean
    energy research center with China. It is $10 million a year.
    That is spent in American laboratories and universities, et
    cetera. It is matched by the Chinese, and both of our
    contributions are matched by industry.
        Mr. McKinley. OK. Well, that is really where I was going,
    is to find out are we investing in bricks and mortar or are we
    investing in research? And you are saying it is in research. So
    if it is in research, will we own the intellectual rights to
    that based on the research we have done? Or will it be
    something shared with the Chinese? Let me leave it at that.
    Will we own the rights?
        Secretary Moniz. The IP issues are very much a part of the
    discussion of every project.
        Mr. McKinley. OK.
        Secretary Moniz. There is a lot of progress on that.
        Mr. McKinley. OK. Next----
        Secretary Moniz. So we are protecting our IP rights.
        Mr. McKinley. What about other governments? Are we
    investing in other countries around? Because we seem to have
    ceded Africa to the Chinese in developing energy that we----
        Secretary Moniz. We----
        Mr. McKinley [continuing]. Backed off.
        Secretary Moniz. First of all, we have a very similar
    matching funds arrangement with India on some joint projects,
    including biofuels, et cetera.
        With Africa, the main investment--again, we tend to provide
    a lot of support, but the main investment comes from AID. So it
    is Department of State funds.
        Mr. McKinley. If I could, I am fearing I am going to run
    out of time.
        I think that the--everyone has, on the other side of the
    aisle, they have been quick to dodge and talk about there is no
    war on coal, but there is obviously a war on coal.
        Secretary Moniz. I disagree.
        Mr. McKinley. And it made people very nervous all around
    the United States about this. That is why these elections have
    consequences, and you have seen what has happened in some
    States as a result of it.
        So I am just curious, because we have got a trade agreement
    coming up. And I have this very strong suspicion that there
    some climate change issues are going to be part of that. Can
    you give me any indication--have you shared anything with the
    administration, or have they talked to you about what
    conditions--it has already been telegraphed a little bit--when
    he went to China and set that deal with China that they could
    increase their CO2 emissions until 2030, while we
    were supposed to decreased ours by 2015, and then went to India
    and cut a deal with India that they would use less coal and
    more nuclear.
        That, to me, was telegraphing that he is going to export
    his war on coal to other Nations. I am concerned about what
    else could happen with the various trade agreements that are
    going to come up. Do you see any component of fossil fuel--the
    emissions of greenhouse gases or anything else going to be in
    any trade agreement?
        Secretary Moniz. I certainly don't know that. I can say
    that when Ambassador Froman has asked me or us for information,
    it has been mainly on oil and natural gas.
        Mr. McKinley. OK. Because I think we ought to be very wary.
    He has already indicated what he has done with two other
    countries. And to add a host of other Nations, 19 other Nations
    into it, I would be very nervous about supporting any trade
    agreement as long as there is a potential of cutting back on
    the use of fossil fuels.
        Apparently, I am running out of time.
        Mr. Whitfield. The gentleman's time has expired.
        Mr. McKinley. He is going to yell at me here.
        Mr. Whitfield. At this time, I recognize the gentlelady
    from Florida, Ms. Castor, for 5 minutes.
        Ms. Castor. Thank you, Mr. Chairman.
        Welcome, Mr. Secretary.
        Secretary Moniz. Thank you.
        Ms. Castor. The Obama administration's energy policies are
    really paying off for American consumers. As the economy
    recovers and more people are working, unemployment is down, to
    have gas prices at the lowest level in 6 years is a great thing
    for so many families and businesses.
        I never thought that I would see gas prices below $2 again.
    But they have these Web sites now where you can go and find the
    lowest--the gas station in your neighborhood. And I just
    checked back in Tampa. I still found one below $2, although
    most are at $2 or a little bit more. So the energy information
    group under your purview said that that is going to save
    consumer families $750 a year.
        Secretary Moniz. Average household savings.
        Ms. Castor. The average household savings. So that comes at
    a great time. And it is part of the strategy, part of what we
    have seen on reduced demand for energy and increased supply. In
    recent years, the U.S. has experienced a natural gas boom, now
    one of the largest natural gas producers in the world.
        And then when you look at savings, the fuel economy is
    remarkable. It has improved year after year for vehicles in the
    U.S. The difference in miles per gallon or your fuel economy
    between 20 miles per gallon and 30 miles per gallon is $518 per
    year for consumers, or about $2,600 over 5 years. And now
    consumers have many more choices when it comes to vehicles. We
    have recently purchased a new car, and the sky is the limit on
    how many different kinds of hybrids, electrics. So I think the
    administration has been right on track.
        Then when you add in wind and solar energy--have tripled
    since 2008. The country is changing how it uses energy. The
    progress, when you sample it, is really impressive. This is a
    study, the Bloomberg New Energy Finance Report. Progress in
    clean energy has really been immense. It says wind and solar
    have achieved liftoff, and the renewable energy story keeps
    getting better, too. In 2007, according to Bloomberg and the
    Business Council for Sustainable Energy, renewable energy
    provided just 7 percent of the Nation's total. But by 2014, it
    had nearly doubled, to 13 percent. That is a real success
    story.
        And then we have seen great improvement in energy
    efficiency, too. This is the most cost effective area. But I am
    still not convinced that we have unleashed the power of
    consumers to really conserve energy and use the existing and
    emerging technology to help them save money and help us all
    conserve energy.
        What is in your budget specifically on energy efficiency
    that will help partner with businesses, the technology
    companies, and unleash the power of consumers to control their
    thermostat or for businesses to do better in saving costs?
        Secretary Moniz. So we do have in the budget a proposed
    increase for building technologies. And those building
    technologies can be everything from external skins of buildings
    and windows to things like smart thermostats and smart
    everything there.
        But I want to emphasize that besides the budgetary
    approach, let me just mention two other things that we do to
    address the demand side. One is, of course, efficiency
    standards. Setting standards for appliances, electric motors,
    et cetera, and keeping at the technology, not at, but maybe it
    is only a little bit behind, at least, the technology frontier.
    That is very important.
        It is not appreciated so much that if we take all of the
    efficiency standards that have come into effect during this
    administration and those that we project for the next 2 years,
    and then we ask for the cumulative impact to 2030, the
    projection is about $450 billion--that is a B--of energy
    savings for consumers and about 3 gigatons of CO2
    avoidance. That is one approach.
        And then finally, the third approach, besides technology
    and standards, is just convening. So we do something called a
    better buildings challenge, for example. All we do is we
    convene companies that volunteer to meet a 20 percent energy
    intensity reduction by 2020. We give them some branding, and
    they agree to share best practices with others. It is really
    fantastic. Some companies reach their 2020 goals in like 3
    years and then double down. So it is a broad-based approach to
    efficiency.
        Ms. Castor. I will add that to my list.
        Mr. Whitfield. The gentlelady's time has expired.
        At this time, I recognize the gentleman from Illinois, Mr.
    Kinzinger, for 5 minutes.
        Mr. Kinzinger. Thank you, Mr. Chairman. Mr. Secretary,
    thank you for being here and giving us your time. And thank you
    for your service to the country.
        I just have a few questions I am going to get right into.
        Do you believe that the Federal Government should use a
    coordinated process to assess the impact of policy decisions on
    national security and foreign policy?
        Secretary Moniz. Yes. In many ways, that is what the
    quadrennial energy review is all about, trying to get an
    integrated coherent approach.
        Mr. Kinzinger. OK. And would you agree that Federal
    decisions for everything from rule making to project reviews
    and export licenses impact energy diplomacy?
        Secretary Moniz. Well, I would say selectively. I think we
    would need to talk about examples.
        Mr. Kinzinger. Well, I believe it is vital that we ensure
    the United States' role as a leader in the nuclear technology
    export market, that it is maintained. China and India have
    increased their nuclear generation capabilities twentyfold, and
    Russia has recently taken the lead in the $500 billion nuclear
    technology export market. In fact, just yesterday it was
    announced that Russia and Egypt signed an accord with one
    another that puts Russia in charge of creating a nuclear plant
    in Egypt.
        Let me ask you about the DOE's role in enhancing U.S.
    manufacturing and competitiveness through your nuclear export
    control policies. Would you agree that strong nuclear exports
    will not only contribute to strengthening domestic job growth,
    but that it will also benefit U.S. influence over international
    nuclear safety and security?
        Secretary Moniz. Yes.
        Mr. Kinzinger. OK. It is an interesting sidenote, too,
    because I think it is--for every $1 billion in exports in this,
    it is something like 10,000 jobs are created, which is--and
    especially for my district, it is huge, too.
        Secretary Moniz. May I just add to reinforce that, also,
    frankly, the United States, I would say, is the gold standard
    in terms of nonproliferation norms in energy commerce. So
    maintaining a strong role in that commerce is very important in
    that point, too.
        Mr. Kinzinger. Yes. And I agree with you. But my concern,
    though, is, as you see, all these other countries, especially
    Russia, proliferate their nuclear exports. We may have the gold
    standard. We may negotiate gold standard agreements. But the
    Russians don't necessarily have the same standards we do, which
    is why I think that is so important.
        Ensuring peaceful use of civilian nuclear technology is a
    core mission and responsibility of yours as the Secretary of
    Energy. What are you doing to ensure that the U.S. is a leader
    in the peaceful use of civilian nuclear technology?
        Secretary Moniz. Well, for one thing, I think there is no
    doubt about it, I think we have, first of all, advocate for
    that and help. I mean we shouldn't lose sight of the fact that
    we do have quite a bit of nuclear technology being built
    elsewhere. I mean, in China, for example, there may be like 18
    Westinghouse AP1000s, for example. And just recently in the
    President's trip to India, there was real progress made in
    terms of implementing that agreement.
        And frankly, again, I and others in the administration,
    when we visit many Eastern European countries, for example, we
    certainly advocate strongly for the value of U.S.-based
    technology.
        Mr. Kinzinger. And I know many of us do when we do our own
    traveling, too.
        Secretary Moniz. Right.
        Mr. Kinzinger. You have been working on the first revision
    of the nuclear export procedures. That would be the first
    revision in more than 25 years. My only concern is this has
    been in progress for a little more than 3 years already. Why is
    it taking so long for the Department to reform its nuclear
    export procedures?
        Secretary Moniz. I think it is fair to say that we will be
    finishing that process very, very shortly.
        Mr. Kinzinger. OK. Good. And according to the GAO report
    issued as part of the committee's ongoing nuclear oversight
    last year, DOE does not have a clear timely, efficient review
    process. Some reviews can take more than a year, depriving the
    U.S. Companies from entering into commercial negotiations. Will
    you commit today that you will ensure that the Department is
    addressing fully the GAO report recommendations?
        Secretary Moniz. We have done and will do all that we can
    to expedite these. I just wanted to caution that, while we are
    perhaps the signatory in the end, it is a multi-agency review
    process and----
        Mr. Kinzinger. And that can get messy. But I just want to
    make sure, at least at your level, it is receiving senior
    attention.
        Secretary Moniz. Yes.
        Mr. Kinzinger. So hopefully that is the case.
        And then lastly, what is the DOE's plan to ensure that
    Federal agencies continue to use private sector funding and
    expertise to meet their energy efficiency goals through energy
    saving performance contracts, or ESPCs? And what is the biggest
    barrier to increasing the use of ESPCs by the Federal
    Government?
        Secretary Moniz. Well, the ESPCs certainly have been very
    effective. And I will be honest, I have lost a little track of
    how many commitments we have--I think we are over $2 billion
    now in terms of ESPC contracts. One of the issues there is, and
    of course, you know, the President has asked us to double that
    to $4 billion, which is going to be a real push.
        But one of the issues is that more and more the projects
    take on a different character than the initial projects. A lot
    of the low-hanging fruit, in a certain sense, in terms of
    direct energy savings may have been--have been done. And now it
    is a question of things like deeper retrofits that have to be
    done. So that is a little bit of an issue we are dealing with
    in going forward.
        Mr. Kinzinger. Understood. Thank you. Thank you for being
    here.
        And I will yield back.
        Mr. Whitfield. At this time, I recognize the gentleman from
    New Jersey, Mr. Pallone, for 5 minutes.
        Mr. Pallone. Mr. Chairman, I would just as soon we continue
    with the other Democrats because I think we are going to have
    votes.
        Mr. Whitfield. At this time, the gentleman from Iowa for 5
    minutes, Mr. Loebsack.
        Mr. Loebsack. Thank you, Mr. Chair.
        And I thank the ranking member for going out of order. I
    appreciate that.
        And thank you, Mr. Secretary, for being here.
        I am very excited to be on the larger Energy and Commerce
    Committee, and on this subcommittee in particular. I am not new
    to Congress, but I am new to the committee and the
    subcommittee. And thank you very much again for being here
    today. And I have really enjoyed the testimony and the
    questions from folks from all over the country.
        I am from Iowa. Of course, there is a lot going on on the
    energy front in Iowa, as you might imagine. In your testimony,
    you state that DOE loans and grants have helped to support two
    commercial-scale cellulosic ethanol facilities, one of these
    located in my home State of Iowa. And as you know, these are
    critical for the country going forward.
        We often talk about corn ethanol. That is first generation
    ethanol. Cellulosic is second generation, and that seems to get
    a little more political support nowadays, although I am still a
    firm supporter, as you might imagine, of corn ethanol.
        But what percentage of funds would be set aside for these
    programs, or can you elaborate a little bit on what might be
    set aside for these particular second generation ethanol
    endeavors?
        Secretary Moniz. Well, there are a variety of approaches.
    And by the way, coming to the committee, if you would like a
    briefing, a broader briefing on DOE, we would be happy to
    arrange that for you.
        Mr. Loebsack. Thank you. I appreciate that.
        Secretary Moniz. Like, for example, with the loan program,
    then there is no specific set-aside for biofuels. That would be
    competing within a broader pool there.
        But if you look at some of our direct programs, one of the
    directions that we are going in now, in addition to the
    cellulosic ethanol, is moving towards drop-in fuels because
    those are--especially the military is very interested in that.
    It is a more complex process.
        We have--I believe it is something like $45 million in this
    budget request specifically for a project with the Department
    of Defense and the USDA in terms of looking towards--I think
    toward three projects for drop-in biofuels. So that is an
    example of what we are doing.
        Mr. Loebsack. OK. Thank you.
        And you mentioned, as you did in your testimony, about the
    investments in biofuels more generally. I don't want to
    implicate you in the whole renewable fuels standard debate.
        Secretary Moniz. Thank you.
        Mr. Loebsack. Certainly. That is for another cabinet member
    probably or two.
        But with the uncertainty of the blending guidelines out
    there, what does that mean for investments in the biofuels
    field, if you will? Do you have any thoughts about that?
        Secretary Moniz. Well, I think, as in all of the energy
    technologies, certainly having some stability and a clear
    projection, I think, is very important.
        So here, I think one of the issues that remains to be
    resolved--and you are right, I am not involved in the RFS--is
    the question of the vehicles. Is 10 percent really a blend
    wall? What is the future in terms of more flex fuel vehicles?
    So I think we often just focus on the fuel, but it is really
    the fuel-vehicle system, I think, that we need to address.
        Mr. Loebsack. Not to mention the infrastructure part of it
    as well?
        Secretary Moniz. And then comes the infrastructure issue.
    And that is where, of course, the alternative, for example,
    biomass-derived drop-in fuels----
        Mr. Loebsack. Right.
        Secretary Moniz [continuing]. Would resolve that, but at
    the cost of it being a much more complex process.
        Mr. Loebsack. Exactly.
        Finally, Iowa is one of the leading wind producing States,
    as you know. Wind energy producing States. About 27 percent or
    so of our electricity in Iowa is generated through wind.
        What kind of investments can we see set aside, if any, for
    the future as far as the wind industry is concerned? If you
    could elaborate on that a little bit.
        Secretary Moniz. Well, the programs continue to look at
    stretching the technology. For example, the materials for
    bigger blades, for example, is very important. One of the
    directions there is in the competitively awarded Manufacturing
    Institute on Composite Materials that we announced in January.
    That is one example. There is work in terms of different direct
    drive, for example, turbines for larger, higher efficiency
    machines.
        By the way, there is also, it is kind of low-brow, but when
    you go to the bigger blades you do have to worry about
    transportation logistics. And that is another issue.
        Mr. Loebsack. I might just say when you come to Iowa next,
    just go down Interstate 80, and you will see lots of those
    blades being transported across the State.
        Secretary Moniz. Yes.
        Mr. Loebsack. They have TPI Composites in Newton in my
    district.
        Secretary Moniz. Yes.
        Mr. Loebsack. We have Siemens in Fort Madison in my
    district.
        Secretary Moniz. Yes. Yes. That is great. Yes.
        And the last thing I will say is probably--it is probably
    slightly less relevant for Iowa, but we are looking at offshore
    wind as well in terms of trying to capture particularly a
    deepwater resource. But that will take a while to get into an
    economically competitive range.
        Mr. Loebsack. Thank you, Mr. Secretary.
        And thank you, Mr. Chair.
        Mr. Whitfield. We have a vote on the floor, and there is
    going to be three votes. And there is about 6 minutes left in
    the first vote.
        I am going to go to you, Mr. Griffith, for your 5 minutes.
    And then I would ask the other members who have not asked
    questions how many of you want to come back. My understanding
    is the Secretary has a 4 o'clock meeting. He has to leave here,
    at the latest, at 3:45.
        Secretary Moniz. Yes. A quarter of, yes.
        Mr. Whitfield. So how many of you would like to come back
    to ask questions?
        OK. Well, I will tell you what, then, we will go with you,
    Mr. Griffith. And I guess that would terminate the questions
    for the Secretary, unless you all want to come back. So why
    don't I recognize Mr. Griffith for 5 minutes.
        Mr. Griffith. Thank you, Mr. Chairman. I do appreciate it.
        Mr. Secretary, I heard you say something in your opening
    comments about a trilateral group that met regarding North
    American energy grid, and indicated that Mexico wanted to hook
    their grid into our grid. This immediately raised some concerns
    which I hope you can allay for me. And that would be that while
    workers in central Appalachia, and particularly in the 9th
    District of Virginia, which I happen to represent, are being
    laid off in the mines because of EPA policy, not DOE policy,
    but because of EPA policy, we have a situation where if we hook
    our grid into Mexico's, they could theoretically be sending
    electricity to the United States made with either Texan coal or
    Mexican coal or somewhere else they get it.
        I would note that Texas did approve a project, it appears
    based on the reports that I have got, in 2013 to send coal.
    Some people claim that it is not as good as coal that we would
    allow to be burned in the United States. But more importantly--
    and I am quoting from an article in, if I am reading this
    right--heartland.org by Cheryl Chumley, ``U.S. Environmental
    Protection Agency restrictions on coal power make Mexico the
    most viable market for U.S. coal mines near the Mexican border.
    Mexico has relatively few restrictions on coal power plants
    relative to the heavy EPA regulations of U.S. coal power
    plants.
        And then there is the concern that in the Coahuila--and I
    hope I pronounced that correctly--region of Mexico, which
    borders Texas, that the Los Zetas, formerly drug gang, now coal
    mining gang as well, have taken over the coal industry. And
    they produce about 95 percent of Mexico's coal.
        So I just worry, if they hook in into our grid and then we
    have a shortage because we have had the EPA debilitate the
    ability to use coal in this country, that we will be using coal
    that is burned at lower standards, lower grade coal, where we
    have extortion and other things operating in the mines and a
    safety record for the workers that is abysmal. And I would have
    to ask you to be cautious on that.
        And I think you would agree with me that--we may not agree
    on how much coal ought to be used, but that when coal is used
    to provide American electricity, it ought to be done under
    American work standards and under American energy standards,
    and that we should not be allowing Mexico to backdoor the use
    of coal, particularly dirty coal, when we have lots of clean
    coal that my folks would like to be mining and are now finding
    themselves unemployed. You would agree with that, would you
    not?
        Secretary Moniz. With all of our international
    engagements--trade engagements, environmental and labor
    standards are critical, yes.
        Mr. Griffith. And the problem is, is that if you start
    wheeling that electricity in, it will have been made under
    their standards, and there is no way you can control that.
    Isn't that accurate?
        Secretary Moniz. Well, I think you have raised an issue
    that we need to be on top of. I do think that it is important
    to recognize, look, this is just an early start of a
    discussion. But to recognize that Mexico is also taking some
    pretty strong environmental positions. That is a discussion
    that will have to evolve. I mean, it is a good point.
        Mr. Griffith. All right. I appreciate that.
        I will tell you that I think the DOE does some good things.
    I am worried about the EPA. And I have got a much longer
    question, but my time is running out because I got diverted
    with the Mexican issue.
        But it appears that the EPA has asked in their budget
    request--and I am quoting now--evaluating and capturing these
    compliance strategies requires the Agency to tap into technical
    and policy expertise not traditionally needed in EPA regulatory
    development, for example, nuclear, wind, solar, hydroelectric,
    and demand side energy efficiency, and to understand and
    project systemwide approaches and trends in areas such as
    electricity transmission, distribution, and storage.
        I just have to you tell you, I often think that the EPA
    thinks that they don't need Congress. It sounds like, from the
    language in their budget request, they don't think they need
    the Department of Energy. What say you?
        Secretary Moniz. I can assure you that we--EPA and other
    agencies, FERC, others, do call upon us for technical analysis.
        Mr. Griffith. Well, but I don't have any problem with them
    calling on you for technical analysis. It seems like they want
    to set up their own technical abilities to do that analysis.
    And don't you think that would be wasteful spending on our part
    to approve that for the EPA when we already have your fine
    agency doing that work? And isn't it just another example of
    EPA overreach?
        Secretary Moniz. I appreciate the endorsement of our
    excellent work.
        Mr. Griffith. And I appreciate you, Mr. Secretary, as well.
        I have other questions that I am afraid I will have to
    submit for the record because our time is up.
        Secretary Moniz. Yes. Do that.
        Mr. Griffith. And we do have votes waiting.
        Secretary Moniz. Thank you.
        Mr. Griffith. But thank you so much for being here today,
    and I appreciate your good work.
        Mr. Whitfield. Mr. Griffith's time has expired. You have
    something, Mr. Flores?
        Mr. Flores. We will submit our questions for the record.
    Thank you for being here.
        Secretary Moniz. Thank you.
        Mr. Whitfield. Mr. Secretary, I have been told that some
    members did want to come back. I am sure we won't be back over
    here until 3:20 or so. Are you available until 3:45?
        Secretary Moniz. Yes. If we could think of 3:45 as an end
    date--end time, that would be great.
        Mr. Whitfield. Well, I tell you, if you wouldn't mind just
    waiting here for a few minutes. I am going to go to the floor
    to vote. I am going to ask the four or five members if they can
    come back, oK. If not, I will call----
        Secretary Moniz. OK.
        Mr. Whitfield [continuing]. And we will conclude the
    hearing. But thank you.
        Secretary Moniz. OK.
        Mr. Whitfield. Thank you, and thank you for being
    available.
        Secretary Moniz. Thank you.
        Mr. Whitfield. Yes. The correct term is recess subject to
    the call.
        [Whereupon, at 2:50 p.m., the subcommittee recessed,
    subject to the call of the Chair.]
        Mr. Whitfield. We will reconvene the hearing. And at this
    point I would recognize the gentleman from Texas, Mr. Barton,
    to resume his question and answer.
        Mr. Barton. Mr. Chairman, I am more than willing to, but I
    think Mr. Johnson is ready to go. I will let him ask his, and
    then I will ask mine.
        Mr. Whitfield. OK.
        Mr. Johnson from Ohio is recognized for 5 minutes.
        Mr. Johnson. Thank you very much, Mr. Chairman. And, Mr.
    Secretary, thanks for joining us again. It is always good to
    see you here.
        My line of questions deal with LNG exports and particularly
    around some of the diplomatic and global, international,
    implications of America getting into that market in a big way.
    In your opinion, will U.S. LNG exports improve the efficiency
    and transparency of international natural gas markets?
        Secretary Moniz. I think in general the more LNG that goes
    into the global market the more opportunity there is for market
    development.
        Mr. Johnson. OK. So I take that is a yes in terms of
    efficiency and transparency? That you think----
        Secretary Moniz. It is the whole LNG global market.
        Mr. Johnson. Right. OK. Do the EIA 2012 LNG export analysis
    and the 2014 update, the NERA economic consulting analysis and
    the NETL analysis, all commissioned by DOE, does that give DOE
    the sufficient data needed to make the public interest
    determination about LNG exports?
        Secretary Moniz. Last year when we modified the process, we
    said that we do have that set of analyses for up to 12 BCF per
    day. We are currently at 5.7, so we are still quite some
    headroom there. But we said we would need to commission, and we
    have done so, new analyses for going from 12 to 20 should that
    be called upon. We are still awaiting the contracted second
    study.
        Mr. Johnson. OK. When do you expect the Cove Point terminal
    to receive its final DOE approval?
        Secretary Moniz. I believe Cove Point has received its
    final approval. Anybody know? Well, I will check that.
        Mr. Johnson. Maybe we can mutually verify.
        Secretary Moniz. We will verify either way. But I would
    emphasize that the--I mean, we have no applications available
    right now for our final approval----
        Mr. Johnson. It was our understanding that, what I was
    expecting, was that you were waiting for FERC to reject their
    opponent's request for rehearing, but FERC is not under a time
    limit; therefore, they are waiting. So the question is are we
    waiting for FERC to do a rehearing? Does anybody know?
        Secretary Moniz. Again, I may be getting confused, but I
    thought we had approved Cove Point. OK. I am sorry? You are
    correct apparently, that we do not have a final approval, we
    are waiting for the EIS then from FERC.
        Mr. Johnson. So FERC does not have a time limit for their
    rehearing. Is there a policy requirement that DOE wait for FERC
    to deny the request for rehearing, or is it just DOE practice?
    Because I liked your first answer. I want it approved.
        Secretary Moniz. So we need to have the EIS in order to
    have the information on environmental impact for the public
    interest determination.
        Mr. Johnson. Is that what would come out of the rehearing
    process?
        Secretary Moniz. If FERC is having a rehearing that is what
    would come of it.
        Mr. Johnson. That is the problem. FERC is not under a
    timeline to do a rehearing, so it just sits there.
        Secretary Moniz. Look, I will go look into the status of
    that.
        Mr. Johnson. Could you, please?
        Secretary Moniz. Yes, I will. And it is just that again we
    need to have the adequate information for our making a public
    determination. Because we decided long ago, the Department
    before I was even at the Department, that we certainly didn't
    want to do a parallel environmental impact statement. So
    typically what we simply do is adopt the FERC statement.
        Mr. Johnson. OK. Shifting gears just a little bit, I want
    to commend you personally for including the $100 million in the
    fiscal year 2016 budget for the continued domestic uranium
    enrichment research and development and demonstration
    activities in Piketon, Ohio. This is a critical domestic need,
    national security--we have talked about that--to produce our
    own enriched uranium.
        The fiscal year 2015 CRomnibus contained language that
    directs the DOE to report to Congress by April 30 of this year
    with an accounting on the current and future availability of
    low-enriched uranium to meet our national security needs. Can
    you give us a status report on that report, and will the
    Department meet the 30 April deadline?
        Secretary Moniz. There is a very active multi-agency
    process going on right now with the aim to meet that target.
        Mr. Johnson. OK. Thank you very much.
        Mr. Whitfield. The gentleman's time is expired.
        At this time I recognize the gentleman from Kentucky, Mr.
    Yarmuth, for 5 minutes.
        Mr. Yarmuth. Thank you very much, Mr. Chairman.
        Mr. Secretary, thank you for being here. I just want to
    begin by applauding your willingness to bring the demonstration
    research to the committees. One of the things that obsesses me
    now is to try to figure out how we can make policy when things
    in the world are changing so rapidly. And we were talking
    earlier about the grid. And I read somewhere not too long ago
    where somebody has invented a way to transmit energy through
    sound waves, electricity through sound waves. And I am thinking
    if that is something that is actually viable and scaleable,
    then we might have a whole different alternative to the grid.
        So the things that I, as a matter of fact, I have thought
    it would be good for us to keep bringing futurists to the
    committee to talk so we can make decisions in context. So
    anyway, I appreciate that and look forward to it.
        One of the things that I have been so excited about in the
    energy field is that the Federally funded clean energy
    manufacturing initiatives have made a huge difference around
    the country, and specifically in my district. We have, because
    of the Federal initiatives, we have like 4,000 new jobs at Ford
    Motor Company manufacturing plant.
        We have several thousand new jobs at a GE appliance plant
    because they are producing now energy-efficient appliances that
    have benefitted from Federal tax credits. They brought a line
    of hybrid water heaters back from China, 420 jobs. So these
    types of programs can have a phenomenal benefit for the
    community. Can you talk about the initiatives going forward,
    what you are proposing in the budget, to continue that kind of
    initiatives to promote energy efficient manufacturing?
        Secretary Moniz. Well, there are many things. For one
    thing, for the Manufacturing Institute Initiative we are
    proposing to have full funding of two new institutes in the
    fiscal year 2016 budget. That would be very exciting. Those are
    competitively awarded. And typically in the competition so far,
    the States have stepped up very, very strongly in terms of
    matching those funds. So that is one very important initiative.
        And by the way, to go back to some earlier discussions,
    with those institutes we are also making sure we integrate
    training programs with them so that, you know, you can get a
    workforce in the area, et cetera.
        On things like the Ford plant you mentioned, I believe was
    part of the loan program in the ATVM. We still have $16 billion
    of authority left in that program, and we are encouraging
    especially suppliers for the auto industry to come forward. And
    we also have, of course, calls out for fossil renewables and
    efficiency and nuclear. And when you put those all together,
    those could really, really help move the needle, I think, as
    have the previous loans in terms of jobs and cutting-edge
    manufacturing.
        Mr. Yarmuth. There is one thing that I have been meaning to
    ask somebody, so you are a good person to ask. Several months
    ago--well, it is probably a year ago now--General Wesley Clark
    was speaking to a group that I was part of, and talking about
    he has been doing a lot of work in the energy field
    internationally and been travelling back and forth to China.
        And one of the things he was concerned about, he talked
    about a company in Washington State that had actually developed
    a process for baking coal, not for energy, but to get very
    valuable minerals. They had been able to do that. And they were
    looking for some venture capital, I think it was $75 million,
    and couldn't find it. So ultimately, a Chinese company came in
    and bought the technology that had been developed in the United
    States. Is that the type of situation that that loan program or
    maybe some other DOE initiatives might be able to accommodate?
        Secretary Moniz. I would have to see it in more detail.
    From what the sound of it, I don't think the loan program would
    do it. The loan program needs to push the technology envelop in
    an emissions-reducing technologies. Now, I don't know what the
    minerals are. For example, earlier we mentioned that there is a
    study going on right now that should be ready 2, 3 months, I
    would guess, on the question of whether or not coal or the coal
    combustion products are a viable source of rare Earth minerals.
        So that is the kind of thing that, if it looks positive,
    then we will come back and work with the Congress to see about
    a program there.
        Mr. Yarmuth. Great. Thank you very much. I yield back.
        Mr. Whitfield. At this time I recognize the gentleman from
    Texas, Mr. Barton.
        Mr. Barton. Thank you. Thank you Mr. Chairman.
        And thank you, Mr. Secretary. We appreciate your access to
    the subcommittee and the full committee. You have always been
    one of the most accessible Obama administration officials, and
    it is appreciated sincerely.
        I want to ask about the situation in the world oil markets.
    As you know, not too many months ago the price of oil was over
    $100 a barrel. Now it is below $50. Massive layoffs in the
    service industry in the oil patch and drilling programs. I
    talked to an independent producer in Texas this past week. They
    had 15 rigs operating a year ago. They have two today. And they
    are not completing the wells. They are just drilling them. They
    are not fracking them. They are just drilling the wells.
        I introduced H.R. 702 last week to repeal the existing ban
    on crude oil exports. I have heard you in other venues say
    reasonably positive things about that. I would like your
    position and the Department's position, and if you are able to
    give it the administration's position, if you all would support
    the outright repeal of the existing ban on crude oil.
        My bill also requires a study of the Strategic Petroleum
    Reserve. You know, we have got a fairly large SPR these days.
    And so we want to repeal the ban and then take a look at what
    the future is for the SPR. I would encourage your comments on
    those two issues.
        Secretary Moniz. Well, Mr. Barton, as you know, the crude
    export policy issue is one for the Department of Commerce to
    address. They did issue this clarification recently about
    lightly processed condensates.
        Mr. Barton. Well, they are granting permits on a case-by-
    case basis, which is appreciated, but that is not a substitute,
    in my opinion, for a comprehensive policy. And it is much more
    cumbersome, it takes a lot longer, and it is not universal, as
    you well know.
        Secretary Moniz. That again, that is an issue that at the
    policy level Department of Commerce would address. I do always
    put in context that we do still import seven million barrels of
    oil per day. And I think that is an issue. That plus, of
    course, current low prices would severely impact, I think, what
    actually, you know, would be the ground truth. But obviously we
    have had some analyses done.
        EIA, for example, has published a piece that says the
    exports would probably have zero or a small negative effect on
    gasoline prices, for example, mainly because the Brent price
    tends to correlate with our product prices. So we will continue
    to do analysis that supports a decision.
        Mr. Barton. I know the Department of Commerce has to make
    these decisions, but I would assume if the President were
    thinking about making a change in law, since it is crude oil
    exports, he would consult with the Secretary of Energy. And you
    happen to be the Secretary of Energy. If the Secretary of
    Commerce were here, I would ask his position, but he is not
    here.
        Secretary Moniz. Her, her.
        Mr. Barton. And you are. I would also point out that we
    export about four million barrels per day of refined products,
    which is up considerably. So we have got a situation where the
    patient is half pregnant. We are exporting the refined
    products, but not allowing the crude. And it does give our
    refiners somewhat of a captive market for the domestic crude
    oil. And if we just went free market totally, I think everybody
    would be better off.
        Obviously, it would squeeze the profit margin of the
    refineries, because they would not be able to maintain that
    captured discount, which has fallen. It has been over $25 a
    barrel, but right now it is I think around $5 a barrel. So as
    the world prices come down, that discount that the domestic
    refineries are receiving is coming down too.
        In my last 37 seconds, FutureGen, the Department I think
    made the correct decision, sadly, not too long ago to stop
    funding that project. What is your position on the next step in
    terms of clean coal technology, carbon capture sequestration,
    or perhaps even carbon capture and conversion?
        Secretary Moniz. Well, first of all, I want to agree with
    your characterization that it was sadly, because getting an
    oxycombustion plant done would be a very good demonstration,
    but the ARRA funding deadline made it not viable. We remain
    very committed to that. We still have a bunch of projects
    coming, including in Texas the Petra Nova project, for example,
    will be coming on. There is the Summit project. And also the
    industrial facilities, the air products project, for example,
    also in Houston is operating.
        So we are going to keep pushing forward. And two things
    looking forward. In addition to our research on, you know, new
    capture technologies, et cetera, two issues going forward: One
    is we do have the active solicitation for $8 billion of loan
    guarantee for fossil projects with emissions reductions. And we
    have a--I can't talk about specifics--but we do have a very
    encouraging proposal stream.
        And, secondly, in the fiscal year 2016 budget, not from DOE
    but from Treasury, is the tax credit proposal for CCS. So a $2
    billion ITC for construction, including C02 infrastructure, and
    a sequestration----
        Mr. Barton. So you are still supportive of research into
    the technologies, bottom line?
        Secretary Moniz. Both research and deployment
    encouragement.
        Mr. Whitfield. We have four members still that would like
    to ask questions. I am going to ask each of you to cut it to 3
    minutes, if possible, because I know the Secretary is leaving.
    He will tell me when he has to go to get to his White House
    meeting, but--Mr. Sarbanes, you are recognized.
        Mr. Sarbanes. Thank you. Thank you for being here, Mr.
    Secretary.
        Could you maybe just give me 1 minute of my 3 minutes
    speaking to what you see as the benefits that are already being
    realized from the efforts, heroic efforts, of the Department of
    Energy over the last few years to just generally diversify the
    energy portfolio of the country. I have an impression that the
    falling gas prices in part can be linked to that general
    commitment to diversification because of the concerns and
    anxiety it produces overseas from OPEC and others.
        But if you could speak to that briefly and any other broad
    benefits you see from the diversification effort, which I think
    has been really terrific over the last few years.
        Secretary Moniz. Well, first of all, the diversification
    effort would go forward irrespective of where the oil price was
    going because this is a long-term investment, number one.
        Number two, very critical, and I would refer you to a
    little paper on our Web site called Revolution Now that shows,
    I think, the big story. The four technologies, including solar
    and LEDs, the vehicle batteries, it shows the tremendous cost
    reduction of those technologies going forward and the
    associated large deployment increase. That is the huge story.
    And that is, in the end, key to what we do trying to push the
    envelop and get the cost down for these technologies.
        Mr. Sarbanes. Great. Let me switch gears to another topic,
    which increasingly according to all the surveys that are coming
    back in the recent period, the American public is now very
    focused on the effects of climate change. And it appears with
    each passing day, more and more are convinced that we need to
    step up and address this in a sustained fashion. And I think
    that is right.
        In your testimony, you talk about the sequestration of over
    nine million metric tons of CO2 through DOE-
    supported projects. You talk about the efficiency standards
    that have been issued in calendar year 2014, and what that will
    mean between now and 2030; that since 2009, you are projecting
    that you will have a 2.2 billion metric ton of carbon emission
    reduction up through 2030. Just speak to how these efforts the
    Department of Energy has undertaken can leverage even more
    meaningful steps more broadly out there in the country to meet
    the challenge that we have in terms of addressing climate
    change.
        Secretary Moniz. Well, first of all, for that example, I
    mean, efficiency is the number one short payback approach
    typically. We do have, we support the R&D to develop
    technologies, but in this case with appliances, et cetera, it
    is more we put out a well-understood standard cost benefit
    analysis, and our companies are plenty innovative enough to
    meet and beat those standards.
        Mr. Sarbanes. Great. Thank you very much.
        Mr. Whitfield. Gentleman's time is expired.
        Mr. Long is recognized.
        Mr. Long. Thank you, Mr. Chairman.
        And thank you, Mr. Secretary for being here.
        What do you attribute these precipitous drop in gasoline
    prices to? What do you think are the main couple of factors
    that have led to this big drop in gas prices?
        Secretary Moniz. Well, I think the main issue is the
    combination of production, especially U.S. production. U.S.
    production of oil went up 1.6 million barrels per day just last
    year.
        Mr. Long. Due to what?
        Secretary Moniz. Due to the technology that had been
    developed over the years in terms of hydraulic fracturing and
    horizontal drilling, opening up the shale plays, also some deep
    water, but the shale plays mainly. So, we had very, very strong
    production. We have produced an extra several million barrels
    per day at the same time that you have economic softness, for
    example, in Europe and a lot of slowed growth in the Far East
    as well. Supply and demand.
        Mr. Long. Yes. Supply and demand. I mean, to me common
    sense dictates, tells me, but I don't have your knowledge. I am
    not in your position. But when we talk about fracking and
    things, and there was a gentlelady on the other side of the
    aisle that spoke earlier that was very happy that gas prices
    have dropped so precipitously, which we are all thrilled.
        The first time I went home after the big drop I filled up,
    I thought the pump had stopped. It was like $30 short of where
    it used to ring up. And we are all pleased with that. But I
    think that fracking has been very effective in increasing the
    amount of production in this country, and I just wanted to make
    sure that I was on the right wavelength with that.
        You also, and to your credit, pointed out when Mr. Olson
    from Texas was talking about the carbon sequestration plant
    down there, and you corrected him and said it is not running.
    We have had hearings before where they are not running. Do we
    have any that are up and running? And if so, why not? And are
    they going to be viable? Because everyone brags about carbon
    sequestration, which would be a great thing, but I haven't
    found any that are operating. You see these projections of when
    they are going to be on line in 2015 and 2017 and 2019, and
    where are we on that?
        Secretary Moniz. Well, again, there are plants operating.
    There is a natural gas reforming facility in Texas that is
    operating, putting carbon underground. I might add, and again
    in terms of an integrated coal plant, the Boundary Dam plant in
    Canada, is fully operational.
        Mr. Long. The one in Texas that he was referring to----
        Secretary Moniz. The Petra Nova is under construction. It
    will be a few years until it is fully operating. The Kemper
    plant in Mississippi is nearing end of construction. The ADM
    ethanol plant capturing CO2 is nearing completion in
    Illinois. So we have a lot.
        And by the way, we have also had from the Great Plains
    plant in North Dakota--it is a gasification facility--it has
    supplied 20 megatons of CO2 for enhanced oil
    recovery in Canada. So there is a lot of activity going on.
        Mr. Long. So we can look forward to the Keystone being
    complete when we get that down here.
        Thank you.
        Mr. Whitfield. Mr. Engel, you are recognized for 3 minutes.
        Mr. Engel. Thank you, Mr. Chairman.
        Thank you, Mr. Secretary, for waiting. I am going to try to
    condense everything into 3 minutes.
        I want to first be on the record in supporting flex-fuel
    cars. I don't understand why every car built in America isn't
    flex-fuel. I am told you can do it for under $100 a car, and I
    think we should be doing it.
        I want to tell you that I appreciate the President's
    budget. It makes a strong commitment to clean energy. I think
    it is important. Climate change is real. There is already
    enough CO2 in the atmosphere to ensure that the U.S.
    will have more episodes of climate disruption. Superstorm Sandy
    in my district in New York, Hurricane Katrina, snow in Boston
    and Buffalo. We really need to take action.
        I have had many long conversations with Con Edison in New
    York about improvements they can make to better protect their
    critical energy infrastructure. And I know that the Department
    of Energy also made recommendations to industry and governments
    to enhance response preparedness, restoration, and resilience
    to future storms. So can you provide me with an update on DOE's
    efforts to implement its recommendations, including updates on
    the northeast gas reserve? How have communications been
    improved? What has been done to facilitate access to fuel and
    other supplies? And have you identified any existing laws that
    need to be amended or laws that need to be promulgated? That is
    my first question.
        My second question involves Indian Point. I have been
    opposed--I have been for closing Indian Point. It is just north
    of New York City. I am convinced it would never be approved at
    its current location if it were to be built today for a myriad
    of reasons. And your predecessor, Dr. Chu, expressed a need to
    look at whether the Indian Point reactors should remain, and I
    am wondering if you could commit to do the same?
        Secretary Moniz. Well, on the first question, first of all,
    more broadly in terms of emergency response, the northeast
    situation is clearly a major one in terms of climate. I just
    want to note that other examples would include, for example,
    the propane issues last year in the upper Midwest. And in all
    these cases we are--first of all, we are greatly increasing
    through the EIA--the EIA is, by the way, a really important
    agency--our database and our communications with State energy
    offices, so that we have good situational awareness.
        Secondly, the Congress did support in fiscal year 2015 our
    expansion of our emergency response capacity at DOE.
        Thirdly, with regard to the petroleum reserve and the
    product reserve--of course, in the northeast now we have both a
    heating oil and a gasoline reserve, a million barrels each, and
    we are performing fuel resiliency studies for other parts of
    the country as well. That gasoline reserve is fully up and
    operational. And there are 700,000 of the million barrels are
    in the New York Harbor area.
        Mr. Whitfield. The gentleman's time is expired.
        Mr. Engel. Mr. Chairman, just give me 10 seconds.
        Could we communicate on Indian Point? I am not opposed to
    nuclear power at all. I just worry about that power plant.
        Secretary Moniz. Maybe we can have that discussion----
        Mr. Engel. Thank you.
        Mr. Whitfield. At this time I recognize the gentleman from
    Oklahoma for 3 minutes.
        Secretary Moniz. Yes, I need to leave in 3.
        Mr. Whitfield. How much time do you have left, Mr.
    Secretary?
        Secretary Moniz. About 3.
        Mr. Mullin. I will literally have one question for you.
    With the rate that our coal-fired power plants are coming off
    line due to the administration's rules on clean air and the war
    on coal, has there been any study at all to know if the
    capacity of our pipeline right now is going to be able to
    supply adequate supply to our power plants? Obviously, we know
    they are going to have to take up the blunt of the load. And I
    believe we are going to have shortage of electricity heating
    our power grid. What I don't want to see is rolling blackouts.
        Secretary Moniz. Right. So, first of all, I want to just
    emphasize I don't accept the war on coal characterization.
        Mr. Mullin. That wasn't my words. That came out of the
    administration's. I mean, anyway, we can debate that at a
    different time.
        Secretary Moniz. And there are many, many factors that have
    influenced the reduction in coal plants, and by the way, I
    might say nuclear plants as well. I have also----
        Mr. Mullin. I understand that, but we have a lot of plants
    coming off line in 2016.
        Secretary Moniz. So on the gas side there was a paper--we
    will be happy to supply it to you--it was published just days
    ago. It was part of an analytical work in our QER. And what it
    says fundamentally is there will be some need for some regional
    build-out of additional gas pipe, but not nearly as much as is
    being discussed. For one reason, in the last years we have had
    a tremendous build-out of gas pipelines, in fact, enough to
    carry twice as much gas as we actually use.
        Mr. Mullin. But getting it to the power plants. We are
    seeing 4 years it is taking to get a permit, on average, to get
    a line built to the power plants. We have units coming down at
    an alarming rate coming 2016.
        If we are downing these things, then what is DOE's answer
    to the shortage we are going to have in 2 years? Because we
    can't even get the lines permitted in that amount of time.
        Secretary Moniz. OK. Again, I think this is a more detailed
    discussion I would be happy to follow-up on. But to emphasize,
    there has been this huge build-out. Those pipes are
    underutilized. So there is a lot we can do just by using the
    unused capacity of these pipes.
        Mr. Mullin. The volume capacity is set by you guys of how
    much due to highly populated areas and rural areas. But so
    there is going to have to be some fluctuation there. We can
    discuss this at further length, because this is obviously
    vitally important.
        So thank you for your time.
        Secretary Moniz. Yes, it is.
        Mr. Whitfield. Time is expired.
        Mr. Flores, do you have one question you want to ask?
        Mr. Flores. I do. I will just submit mine for the record.
        Mr. Whitfield. OK. Mr. Secretary, thank you. So sorry.
        We appreciate it and we look forward to working with you.
    And thank you so much.
        Secretary Moniz. And we have a number of things to get back
    with, various numbers.
        Mr. Whitfield. That concludes today's hearing. The record
    will remain open for 10 days. And that is the end of the
    hearing.
        [Whereupon, at 4:00 p.m., the subcommittee was adjourned.]
        [Material submitted for inclusion in the record follows:]
        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        [Secretary Moniz's answers to submitted questions have been
    retained in committee files and are available at: http://
    docs.house.gov/meetings/if/if03/20150211/102942/hhrg-114-if03-
    wstate-monize-20150211-sd543.pdf.]

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