[House Hearing, 115 Congress]
[From the U.S. Government Publishing Office]


 THE 2017 HURRICANE SEASON: A REVIEW OF EMERGENCY RESPONSE AND ENERGY 
                    INFRASTRUCTURE RECOVERY EFFORTS

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

                                HEARING

                               BEFORE THE

                         SUBCOMMITTEE ON ENERGY

                                 OF THE

                    COMMITTEE ON ENERGY AND COMMERCE
                        HOUSE OF REPRESENTATIVES

                     ONE HUNDRED FIFTEENTH CONGRESS

                             FIRST SESSION

                               __________

                            NOVEMBER 2, 2017

                               __________

                           Serial No. 115-72
                           
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                    COMMITTEE ON ENERGY AND COMMERCE

                          GREG WALDEN, Oregon
                                 Chairman

JOE BARTON, Texas                    FRANK PALLONE, Jr., New Jersey
  Vice Chairman                        Ranking Member
FRED UPTON, Michigan                 BOBBY L. RUSH, Illinois
JOHN SHIMKUS, Illinois               ANNA G. ESHOO, California
MICHAEL C. BURGESS, Texas            ELIOT L. ENGEL, New York
MARSHA BLACKBURN, Tennessee          GENE GREEN, Texas
STEVE SCALISE, Louisiana             DIANA DeGETTE, Colorado
ROBERT E. LATTA, Ohio                MICHAEL F. DOYLE, Pennsylvania
CATHY McMORRIS RODGERS, Washington   JANICE D. SCHAKOWSKY, Illinois
GREGG HARPER, Mississippi            G.K. BUTTERFIELD, North Carolina
LEONARD LANCE, New Jersey            DORIS O. MATSUI, California
BRETT GUTHRIE, Kentucky              KATHY CASTOR, Florida
PETE OLSON, Texas                    JOHN P. SARBANES, Maryland
DAVID B. McKINLEY, West Virginia     JERRY McNERNEY, California
ADAM KINZINGER, Illinois             PETER WELCH, Vermont
H. MORGAN GRIFFITH, Virginia         BEN RAY LUJAN, New Mexico
GUS M. BILIRAKIS, Florida            PAUL TONKO, New York
BILL JOHNSON, Ohio                   YVETTE D. CLARKE, New York
BILLY LONG, Missouri                 DAVID LOEBSACK, Iowa
LARRY BUCSHON, Indiana               KURT SCHRADER, Oregon
BILL FLORES, Texas                   JOSEPH P. KENNEDY, III, 
SUSAN W. BROOKS, Indiana             Massachusetts
MARKWAYNE MULLIN, Oklahoma           TONY CARDENAS, California
RICHARD HUDSON, North Carolina       RAUL RUIZ, California
CHRIS COLLINS, New York              SCOTT H. PETERS, California
KEVIN CRAMER, North Dakota           DEBBIE DINGELL, Michigan
TIM WALBERG, Michigan
MIMI WALTERS, California
RYAN A. COSTELLO, Pennsylvania
EARL L. ``BUDDY'' CARTER, Georgia
JEFF DUNCAN, South Carolina

                                 7_____

                         Subcommittee on Energy

                          FRED UPTON, Michigan
                                 Chairman
PETE OLSON, Texas                    BOBBY L. RUSH, Illinois
  Vice Chairman                        Ranking Member
JOE BARTON, Texas                    JERRY McNERNEY, California
JOHN SHIMKUS, Illinois               SCOTT H. PETERS, California
ROBERT E. LATTA, Ohio                GENE GREEN, Texas
GREGG HARPER, Mississippi            MICHAEL F. DOYLE, Pennsylvania
DAVID B. McKINLEY, West Virginia     KATHY CASTOR, Florida
ADAM KINZINGER, Illinois             JOHN P. SARBANES, Maryland
H. MORGAN GRIFFITH, Virginia         PETER WELCH, Vermont
BILL JOHNSON, Ohio                   PAUL TONKO, New York
BILLY LONG, Missouri                 DAVID LOEBSACK, Iowa
LARRY BUCSHON, Indiana               KURT SCHRADER, Oregon
BILL FLORES, Texas                   JOSEPH P. KENNEDY, III, 
MARKWAYNE MULLIN, Oklahoma               Massachusetts
RICHARD HUDSON, North Carolina       G.K. BUTTERFIELD, North Carolina
KEVIN CRAMER, North Dakota           FRANK PALLONE, Jr., New Jersey (ex 
TIM WALBERG, Michigan                    officio)
GREG WALDEN, Oregon (ex officio)

                                  (ii)
                             
                             
                             C O N T E N T S

                              ----------                              
                                                                   Page
Hon. Fred Upton, a Representative in Congress from the State of 
  Michigan, opening statement....................................     2
    Prepared statement...........................................     3
Hon. Bobby L. Rush, a Representative in Congress from the State 
  of Illinois, opening statement.................................     4
Hon. Greg Walden, a Representative in Congress from the State of 
  Oregon, opening statement......................................     5
    Prepared statement...........................................     6
Hon. Frank Pallone, Jr., a Representative in Congress from the 
  State of New Jersey, opening statement.........................     8
    Prepared statement...........................................     9

                               Witnesses

Patricia Hoffman, Principal Assistant Secretary, Office of 
  Electricity Delivery and Energy Reliability, Department of 
  Energy.........................................................    10
    Prepared statement...........................................    13
    Answers to submitted questions...............................   233
Ray Alexander, Director of Contingency Operations, Army Corps of 
  Engineers......................................................    17
    Prepared statement...........................................    19
    Answers to submitted questions...............................   244
DeAnn T. Walker, Chairman, Public Utility Commission of Texas....    23
    Prepared statement...........................................    25
Robert F. Corbin, Deputy Assistant Secretary, Office of Petroleum 
  Reserves, Department of Energy.................................    37
    Prepared statement...........................................    39
    Answers to submitted questions...............................   251
Frank Rusco, Director, Natural Resources and Environment, 
  Government Accountability Office...............................    45
    Prepared statement...........................................    47
Thomas A. Fanning, President and Chief Executive Officer, 
  Southern Company, on Behalf of the Electricity Subsector 
  Coordinating Council...........................................   101
    Prepared statement...........................................   103
    Answers to submitted questions...............................   255
Julio A. Rhymer, Sr., Executive Director and Chief Executive 
  Officer, Virgin Islands Water & Power Authority................   114
    Prepared statement...........................................   116
Chet Thompson, President and Chief Executive Officer, American 
  Fuel & Petrochemical Manufacturers.............................   125
    Prepared statement...........................................   127
Max E. McBrayer, Jr., Chief Supply Officer and Chief Financial 
  Officer, RaceTrac Petroleum, Inc., on Behalf of the National 
  Association of Convenience Stores and the Society of 
  Independent Gasoline Marketers of America......................   144
    Prepared statement...........................................   146
Ramon-Luis Nieves, Attorney at Law, Former Member, Senate of 
  Puerto Rico....................................................   155
    Prepared statement...........................................   157
Catherine B. Kennedy, Vice President, National Nurses United.....   170
    Prepared statement...........................................   172

                           Submitted Material

Letter of November 3, 2017, from Eugene Dacus, Director, Office 
  of Congressional Affairs, Nuclear Regulatory Commission, to Mr. 
  Upton, submitted by Mr. Olson \1\
Letter of October 31, 2017, from Ricardo L. Ramos Rodriguez, 
  Chief Executive Officer, Puerto Rico Electric Power Authority, 
  to American Public Power Association and Edison Electric 
  Institute, submitted by Mr. Olson..............................   213
Letter of November 1, 2017, from Susan N. Kelly, President and 
  Chief Executive Officer, American Public Power Association, to 
  Mr. Upton and Mr. Rush, submitted by Mr. Olson.................   215
Letter of October 31, 2017, from Sue Kelly, President and Chief 
  Executive Officer, American Public Power Association, and Tom 
  Kuhn, President, Edison Electric Institute, to Ricardo L. Ramos 
  Rodriguez, Chief Executive Officer, Puerto Rico Electric Power 
  Authority, submitted by Mr. Olson..............................   219
Letter of November 1, 2017, from Stephen J. Ubl, President and 
  Chief Executive Officer, PhRMA, to Mr. Upton and Mr. Rush, 
  submitted by Mr. Olson.........................................   220
Statement of Energy Information Administration, Department of 
  Energy, by John J. Conti, Acting Administrator, with 
  supplemental material, November 2, 2017, submitted by Mr. Olson 
  \2\
Letter of November 2, 2017, from Scott Whitaker, President and 
  Chief Executive Officer, AdvaMed, to Mr. Upton and Mr. Rush, 
  submitted by Mr. Olson.........................................   223
Letter of November 2, 2017, from Scott Gottlieb, Commissioner of 
  Food and Drugs, Food and Drug Administration, to Committee and 
  Subcommittee Leadership, submitted by Mr. Olson................   224
Statement of the GridWise Alliance, November 2, 2017, submitted 
  by Mr. Olson...................................................   226
Letter of October 31, 2017, from Judith Enck, Former EPA Region 2 
  Regional Administrator, and Ramon Cruz, Former Commissioner, 
  Puerto Rico Energy Commission, to Hon. Lisa Murkowski, Chair, 
  and Hon. Maria Cantwell, Ranking Member, Senate Committee on 
  Energy and Natural Resources, submitted by Mr. Olson...........   230

----------
\1\ The information has been retained in committee files and also 
  is available at  http://docs.house.gov/meetings/IF/IF03/
  20171102/106573/HHRG-115-IF03-20171102-SD010.pdf.
\2\ The information has been retained in committee files and also 
  is available at  http://docs.house.gov/meetings/IF/IF03/
  20171102/106573/HHRG-115-IF03-20171102-SD003.pdf.

 
 THE 2017 HURRICANE SEASON: A REVIEW OF EMERGENCY RESPONSE AND ENERGY 
                    INFRASTRUCTURE RECOVERY EFFORTS

                              ----------                              


                       THURSDAY, NOVEMBER 2, 2017

                  House of Representatives,
                            Subcommittee on Energy,
                          Committee on Energy and Commerce,
                                                    Washington, DC.
     The subcommittee met, pursuant to call, at 10:34 a.m., in 
room 2123, Rayburn House Office Building, Hon. Fred Upton 
(chairman of the subcommittee) presiding.
    Members present: Representatives Upton, Olson, Shimkus, 
Latta, Harper, McKinley, Kinzinger, Griffith, Johnson, Long, 
Bucshon, Flores, Mullin, Hudson, Walberg, Walden (ex officio), 
Rush, McNerney, Green, Doyle, Castor, Sarbanes, Welch, Tonko, 
Loebsack, Schrader, Kennedy, Butterfield, and Pallone (ex 
officio).
    Also present: Representative Bilirakis.
    Staff present: Ray Baum, Staff Director; Mike Bloomquist, 
Deputy Staff Director; Adam Buckalew, Professional Staff 
Member, Health; Allie Bury, Legislative Clerk, Energy/
Environment; Karen Christian, General Counsel; Kelly Collins, 
Staff Assistant; Zack Dareshori, Staff Assistant; Wyatt 
Ellertson, Professional Staff Member, Energy and Environment; 
Adam Fromm, Director of Outreach and Coalitions; Jordan 
Haverly, Policy Coordinator, Environment; A.T. Johnston, Senior 
Policy Advisor, Energy; Mary Martin, Chief Counsel, Energy and 
Environment; Alex Miller, Video Production Aide and Press 
Assistant; Brandon Mooney, Deputy Chief Counsel, Energy; Mark 
Ratner, Policy Coordinator; Annelise Rickert, Counsel, Energy; 
Dan Schneider, Press Secretary; Peter Spencer, Senior 
Professional Staff Member, Energy; Jason Stanek, Senior 
Counsel, Energy; Madeline Vey, Policy Coordinator, Digital 
Commerce and Consumer Protection; Hamlin Wade, Special Advisor 
for External Affairs; Everett Winnick, Director of Information 
Technology; Andrew Zach, Senior Professional Staff Member, 
Environment; Priscilla Barbour, Minority Energy Fellow; Jeff 
Carroll, Minority Staff Director; Rick Kessler, Minority Senior 
Advisor and Staff Director, Energy and Environment; John 
Marshall, Minority Policy Coordinator; Jon Monger, Minority 
Counsel; Alexander Ratner, Minority Policy Analyst; Tim 
Robinson, Minority Chief Counsel; Tuley Wright, Minority Energy 
and Environment Policy Advisor; C.J. Young, Minority Press 
Secretary; and Catherine Zander, Minority Environment Fellow.
    Mr. Upton. The Subcommittee on Energy will now come to 
order.
    And the Chair will recognize himself for an opening 
statement.

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

    So, this year's Atlantic hurricane season was 
unprecedented. Four named storms in close succession slammed 
into the Gulf, Puerto Rico, and the U.S. Virgin Islands. These 
hurricanes caused catastrophic damage and energy supply 
disruptions across the country. While Texas and Florida are 
further down the road to recovery, a humanitarian crisis is 
unfolding in Puerto Rico--a number of colleagues from this 
committee have been down there--and the U.S. Virgin Islands, 
where the majority of folks still remain without power for more 
than a month after Hurricane Maria made landfall.
    Today's hearing will review the emergency response and 
energy recovery efforts in the wake of those storms. It will 
help us begin to understand what went right and what went 
wrong, what lessons can be learned, and how we, as 
policymakers, can identify gaps, so that when the next 
hurricane hits, we will be better prepared.
    As a result of Hurricane Harvey, more than 275,000 
customers lost power in Texas, and severe flooding also 
affected the supply and delivery of transportation fuels, 
compounding response challenges and energy impacts across the 
Gulf. Hurricane Irma left more than a million customers without 
power across Puerto Rico and the Virgin Islands. More than 6 
million customers in Florida and another million in Georgia and 
South Carolina also lost power. Then, two weeks after Irma, 
Hurricane Maria delivered the knockout punch, wiping out the 
entire grid on Puerto Rico and the Virgin Islands. At peak, 
more than 3\1/2\ million folks were without power.
    As with most disasters, energy restoration is performed by 
Federal, State, and local authorities, who provide vital 
resources, infrastructure support, and logistical coordination, 
and by industry, which provides the expertise and manpower to 
restore energy supply and services.
    As we have witnessed nightly in the news, recovery on the 
islands has been painfully difficult and slow. Questions are 
mounting regarding the role of the Puerto Rico Electric Power 
Authority, PREPA, and its initial reluctance to request mutual 
aid from mainland electricity companies that were standing by 
ready to assist immediately after the storm. Rather than 
request mutual assistance, as Texas and Florida did in the 
preceding storms, PREPA took the unusual step to award a 
contract to a virtually unknown company which it then canceled. 
The deals that PREPA signed immediately following the storm are 
now the subject of an investigation by this committee, as they 
should be.
    Today we are going to hear from two witness panels which 
will provide perspective from the Federal level, the State 
level, and the industry responder level. As we have seen in 
recent weeks across the areas affected by the storms, each 
disaster creates its own set of problems. Today's witnesses can 
help us understand the factors that contribute to these 
problems and what we may do to ensure a more effective response 
going forward.
    It will also help us understand the challenges that they 
face as they move energy and product in the aftermath of 
devastating storms. While we have seen alarming devastation, we 
have also seen some aspects of the response go right. At this 
point, by most accounts, the Department of Energy's support 
functions have gone well. DOE's coordination of regulatory 
assistance, or waivers, during the disasters has gone well. 
Their informational assistance has been consistent and helpful 
to Government and industry alike.
    We will hear this morning about the Strategic Petroleum 
Reserve, which during Harvey served to provide emergency 
petroleum swaps to make up for the temporary loss of supply and 
keep prices at the pump somewhat stable.
    We will also receive an important update on the various 
restoration efforts to bring power back to the folks of Puerto 
Rico and the Virgin Islands. It will be particularly helpful to 
understand what have been the barriers to a more rapid 
recovery, what we are learning about coordination of emergency 
response and restoration on these Territories, and what is 
needed more from us, the Congress. How can we apply these 
lessons going forward? This hearing should help us answer some 
of those critical questions.
    [The prepared statement of Mr. Upton follows:]

                 Prepared statement of Hon. Fred Upton

    This year's Atlantic hurricane season was unprecedented--
four named storms in close succession slammed into the Gulf 
Coast, Puerto Rico and the U.S. Virgin Islands. These 
hurricanes caused catastrophic damage and energy supply 
disruptions across the Nation. While Texas and Florida are 
further down the road to recovery, a humanitarian crisis is 
unfolding in Puerto Rico and the U.S. Virgin Islands, where the 
majority of people still remain without power more than a month 
after Hurricane Maria made landfall.
    Today's hearing will review the emergency response and 
energy recovery efforts in the wake of these storms. It will 
help us begin to understand what went right and what went 
wrong. What lessons can be learned, and how we as policy makers 
can identify gaps, so that when the next hurricane hits, we are 
better prepared.
    As a result of Hurricane Harvey, more than 275,000 
customers lost power in Texas, and severe flooding also 
affected the supply and delivery of transportation fuels-
compounding response challenges and energy impacts across the 
Gulf Coast. Hurricane Irma, left more than 1 million customers 
without power across Puerto Rico and the Virgin Islands. More 
than 6 million customers in Florida and another 1 million in 
Georgia and South Carolina also lost power. Then, just two 
weeks after Irma, Hurricane Maria delivered the knockout punch, 
wiping out the entire grid on Puerto Rico and the Virgin 
Islands. At peak, more than 3.5 million people were without 
power.
    As with most disasters, energy restoration is performed by 
Federal, State, and local authorities, who provide vital 
resources, infrastructure support, and logistical coordination, 
and by industry, which provides the expertise and manpower to 
restore energy supplies and services.
    As we've witnessed nightly in the news, recovery on the 
islands has been painfully difficult and slow. Questions are 
mounting regarding the role of the Puerto Rico Electric Power 
Authority (PREPA) and its initial reluctance to request 
``mutual aid'' from mainland electricity companies that were 
standing-by ready to assist immediately after the storm. Rather 
than request mutual assistance as Texas and Florida did in the 
preceding storms, PREPA took the unusual step to award a 
contract to a virtually unknown company which it then canceled. 
The deals that PREPA signed immediately following the storm are 
now the subject of an investigation by this committee.
    Today, we will hear from two witness panels, which will 
provide perspective from the Federal level, the State level, 
and the industry responder level. As we've seen in recent weeks 
across the areas affected by the storms, each disaster creates 
its own set of problems. Today's witnesses can help us 
understand the factors that contribute to these problems and 
what we may do to ensure a more effective response going 
forward. They will also help us understand the challenges they 
face as they move energy and product in the aftermath of 
devastating storms. While we've seen alarming devastation, we 
have seen some aspects of the response go right. To this point, 
by most accounts, Department of Energy support functions have 
gone well. DOE's coordination of regulatory assistance (or 
``waivers'') during the disasters has gone well. Their 
informational assistance has been consistent and helpful to 
Government and industry alike.
    We'll hear this morning about the Strategic Petroleum 
Reserve, which during Harvey served to provide emergency 
petroleum swaps to make up for the temporary loss of supply. 
We'll also receive an important update on the various 
restoration efforts to bring power back to the people of Puerto 
Rico and the Virgin Islands. It will be particularly helpful to 
understand what have been the barriers to a more rapid 
recovery. What are we learning about coordination of emergency 
response and restoration on these Territories? What more is 
needed from Congress? How can we apply these lessons going 
forward?
    This hearing should help us begin to answer these critical 
questions.

    Mr. Upton. And I yield now to the ranking member of the 
subcommittee, my friend, the gentleman from Illinois, Mr. Rush.

 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, for holding 
this important hearing, examining the 2017 hurricane season and 
the emergency response and energy infrastructure recovery 
efforts surrounding these emergencies.
    Mr. Chairman, I hope this will not be a ``one and done'' 
hearing. Folks know in this year's historic and devastating 
hurricane season that there are many, many critical 
interrelated issues that must be addressed.
    While I appreciate having witnesses here to discuss the GAO 
report that we requested last year, the fact of the matter, Mr. 
Chairman, is that, as we speak, there are still many millions 
of American citizens living without electricity, and many are 
facing dire life-and-death conditions. It is over a month now 
that Hurricanes Harvey and Irma and Maria shattered their lives 
and devastated their livelihoods.
    Mr. Chairman, it is my hope that this hearing will shed 
light on what additional steps need to be taken quickly to 
restore power while also assuring those residents in Puerto 
Rico and the U.S. Virgin Islands specifically that their 
Government has not forgotten about them and that we will 
provide the exact same effort and the exact same attention to 
helping them as we would for any other American citizen.
    Mr. Chairman, as you know, more than six weeks after 
Hurricane Maria initially made landfall, nearly 70 percent of 
Puerto Rico and 80 percent of the U.S. Virgin Islands still, 
Mr. Chairman, still lack the power needed for basic everyday 
services, such as lighting their homes, treating drinking 
water, preserving food and medicine, or even making emergency 
calls, among other critical functions that are so necessary to 
normal and daily activities.
    While immediate attention must be focused, Mr. Chairman, on 
providing essential resources to protect the safety of 
individuals and help them cope in maintaining their lives, over 
the long term we must also help to rebuild the energy 
infrastructure in a way that makes it stronger and more 
resilient against extreme weather conditions.
    Mr. Chairman, Hurricanes Irma and Maria exposed the 
vulnerability of the Puerto Rico and U.S. Virgin Islands 
electric grids to extreme weather, while some communities 
expected to remain without power for even months on end. In 
fact, a study released last week by the Rhodium Group concluded 
that the outages caused by Hurricane Maria resulted in 1.25 
billion hours of electricity-supply disruption to households in 
Puerto Rico and the U.S. Virgin Islands, Mr. Chairman, making 
this sole event the Nation's largest blackout that was ever 
recorded. ``We can find no event in recorded U.S. history where 
there were as many people without power for as long as has 
occurred over the past month in Puerto Rico and the U.S. Virgin 
Islands,'' the report stated.
    Mr. Chairman, I look forward to engaging today's 
distinguished panel on the progress that has been made, the 
additional steps that must be taken to immediately get the 
power back on, as well as the ways that we build more resilient 
and sustainable infrastructure that is less vulnerable to an 
extreme weather condition that we have witnessed and that we 
certainly will witness in the future.
    Thank you, Mr. Chairman. I yield back the balance of my 
time.
    Mr. Olson [presiding]. The gentleman yields back.
    The Chair now calls upon the chairman of the full 
committee, Mr. Walden, for 5 minutes.

  OPENING STATEMENT OF HON. GREG WALDEN, A REPRESENTATIVE IN 
               CONGRESS FROM THE STATE OF OREGON

    Mr. Walden. I thank the gentleman and acknowledge his 
uniform today.
    The 2017 hurricane season has been among the worst in 
recent memory. Four major storms have wreaked havoc all over 
our Gulf Coast and, more recently, in Puerto Rico and the 
Virgin Islands. While fuel supplies and electricity have been 
restored on the mainland, a humanitarian crisis continues to 
unfold in Puerto Rico and the U.S. Virgin Islands, and I think 
you hear that from both sides of the aisle here. This is a 
real, real serious situation we all care deeply about.
    As we often do following natural disasters, it is not 
uncommon to see stories in the news about heroics and acts of 
personal sacrifice and great kindness. We trust that our 
policymakers can put aside their differences to do what is in 
the best interest of the country. We have already passed 
initial supplemental disaster relief funding this Congress, but 
we understand that much more is needed, and we will continue to 
work with the administration and our colleagues, so that our 
fellow citizens can get the additional resources they need to 
recover and to rebuild.
    In this committee we roll up our sleeves and we search for 
solutions to the various challenges that present themselves 
after a major disaster. We want to make sure that the agencies 
under our jurisdiction are well-prepared and that you all are 
responding appropriately, both now and that we learn from 
lessons of bad incidents and are ready and even better prepared 
for the next storm or the next disaster.
    If you are lacking certain authorities, let us know. We 
would like to expedite recovery. We want to know about these 
things, so that we can help fix them. We are all in this 
together.
    We want to be practical and we want to be forward-thinking. 
How can we help ensure the relevant Federal response is well-
coordinated with State, local, and industry responders? How do 
we ensure decisions are made to guarantee taxpayer funding 
provides the maximum benefit for those in need and that 
taxpayers aren't ripped off? If we need to rebuild, what can we 
do to make our infrastructure more resilient?
    Because of this committee's broad jurisdiction over public 
health, emergency telecommunications, and the supply and 
delivery of energy, we will be gathering facts, perspectives, 
and lessons learned. We have already heard from witnesses on 
our Oversight and Investigations Subcommittee hearing about 
HHS's public health preparedness for and responses to the 
hurricanes. We will soon examine the disaster response related 
to environmental hazards and telecommunications as well.
    But today we are focusing on emergency response and energy 
infrastructure recovery, both for fuel supply and the electric 
grid. This year we have already been confronted with several 
different challenging situations: historic flooding in Houston, 
possibly the greatest evacuation in Florida's history, an 
energy crisis in Puerto Rico and the U.S. Virgin Islands that 
could leave millions without power for estimated months to 
come.
    We may take for granted how lucky we are that we can flip a 
switch and the lights come on. For our citizens in Puerto Rico 
and the U.S. Virgin Islands, however, almost every aspect of 
their lives has been deeply disrupted. Hospitals without 
external generators cannot serve their patients. Getting that 
power restored is critical. Water treatment plants without 
power threaten the health of individuals that rely on them for 
safe water. And those who live in remote areas that do not have 
access to fuel are cut off even from the most basic of 
necessities.
    The witness panel today will provide important perspectives 
about the state of current fuel and electric supply recovery 
efforts, what worked, what could be done better under urgent 
circumstances of the hurricanes, and what may be considered in 
the future. I expect this will be an excellent hearing for us 
to identify vulnerabilities and assess what is needed to better 
prepare and respond to future storms and disasters.
    And with that, I want to thank you for being here today. I 
appreciate the testimony which you have already submitted that 
I have, and thanks for the good work you and your teams are 
doing out there. We really want to learn from you and be even 
better prepared when the next disaster hits.
    So, with that, Mr. Chairman, unless anybody else on our 
side seeks the remaining minute, I would yield back.
    [The prepared statement of Mr. Walden follows:]

                 Prepared statement of Hon. Greg Walden

    Let me welcome Secretary Perry to his first appearance 
before the Energy and Commerce Committee. I understand that 
yesterday DOE held a ceremony to celebrate its 40 years as a 
cabinet agency. A lot has changed in this country and in the 
world since Congress created the department--especially in the 
national security and energy security space, where DOE provides 
critical functions for the country.
    While the domestic and international energy posture is 
substantially different from what it was in the 1970s, I do not 
believe the importance of DOE's role serving the national and 
public interest has diminished.
    This past August, Secretary Perry joined me at an energy 
roundtable with local officials and energy leaders at the 
McNary Dam, on the Columbia River in Umatilla County, Oregon, 
which produces power for the Bonneville Power Administration. 
Of course, Secretary Perry could not leave Umatilla County 
without a famous Hermiston watermelon--the best in the world. I 
believe Secretary Perry also left with a greater appreciation 
of the tremendous, zero-carbon-emitting power resource we have 
that's helping grow the economy in Oregon and throughout the 
Northwest.
    The next day, I had the pleasure of accompanying Secretary 
Perry to DOE's Pacific Northwest National Laboratory and then 
to the Hanford Site, just up the Columbia River from my Oregon 
district.
    A couple of observations from that visit are pertinent for 
today: First, it was evident that abundant energy was critical 
to the historical success of Hanford's industrial operations, 
which built nuclear reactors and produced the plutonium vital 
to winning World War II and later maintaining the Nation's 
nuclear deterrent program.
    Second, Hanford's success, and subsequent cleanup 
operations, led to advances in engineering practices, research 
and development programs, and scientific activities necessary 
for the site's safe and secure operations. These advances led 
to the development of a world-class national laboratory. Today, 
the Pacific Northwest National Laboratory, in collaboration and 
partnership with DOE's 16 other national laboratories, provide 
scientific and technical breakthroughs to meet our national 
security and energy security needs-from securing our electric 
grid to advancing storage technologies.
    As we examine the DOE management and mission priorities 
today, we should keep in mind the benefits of the 
interconnected nature of the department's missions. But these 
missions across DOE's enterprise can be expensive and difficult 
to manage. And so, it is the responsibility of the secretary 
and the Congress to ensure the department is appropriately 
aligned to perform these missions in a cost-effective manner, 
and to the maximum benefit of the taxpayer.
    As Chairman Upton has indicated, the energy threats today 
are not the same as the threats of the 1970s, but they remain 
significant. This committee will work in the coming months and 
through this Congress to ensure the department's organization 
and missions are aligned with the energy security challenges of 
today.
    At my direction, Vice Chairman Barton has already started 
to facilitate, in coordination with the Energy Subcommittee, 
work to ensure DOE resources are focused on the core missions 
of nuclear and energy security, environmental remediation, and 
mission-enabling science and R&D programs. At the same time, 
the committee will be examining expired DOE authorizations-many 
of which expired over a decade ago, to ensure more fully 
appropriate program alignment.
    I look forward to your testimony, Secretary Perry, it will 
be helpful to both these efforts. I'd also like for you to 
address the recent questions that have arisen regarding your 
travel expenditures. In closing, I look forward to working 
closely with DOE and my colleagues as we ensure the agency is 
positioned appropriately for the energy security challenges 
that lie ahead.

    Mr. Upton [presiding]. I just might ask a question of the 
vice chair of the committee. Are you intending to wear that 
jersey on the House floor when we take the picture of the full 
House this afternoon?
    Mr. Olson. Mr. Chairman, that is not an issue. I tried to 
wear this about three weeks, and it was banned. So, this will 
not be in the picture----
    Mr. Upton. All right.
    Mr. Olson [continuing]. Much to your disappointment, I can 
tell.
    Mr. Upton. I just was curious because, then, we would 
always be able to find you forever, right, in that picture?
    [Laughter.]
    Mr. Walden. Now, Mr. Chairman, I yield back the balance of 
my time.
    Mr. Upton. Yes, the gentleman yields back.
    I recognize the ranking member of the full committee, Mr. 
Pallone from New Jersey, for an opening statement.

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

    Mr. Pallone. Thank you, Mr. Chairman, for convening today's 
hearing reviewing the disastrous 2017 hurricane season, which 
has wreaked havoc on many parts of our country.
    And I am grateful to former Senator Nieves of Puerto Rico 
and Mr. Rhymer of the Virgin Islands for coming here today. I 
guess they are on the second panel.
    But I am disappointed that the committee did not even 
receive a response to its outreach to the Puerto Rico Electric 
Power Authority, or PREPA. I have serious concerns not only 
about how PREPA has overseen the effort to restore power in 
Puerto Rico, but also, more broadly, on how PREPA has managed 
or, more accurately, mismanaged the grid in Puerto Rico over 
the years.
    Now, today we are focusing on the energy infrastructure 
recovery efforts. I must say that accounts from the areas 
affected by these storms paint a dire situation that completely 
contradicts the often rosy stories that come from the White 
House. The truth is that, taken together, Puerto Rico and the 
Virgin Islands are currently experiencing the largest blackout 
in American history, and this nightmare for our fellow citizens 
is far from over.
    The central question for us today should be, why is it 
taking so long to restore power in Puerto Rico and the Virgin 
Islands, and who is actually in charge of the effort to restore 
power to Puerto Rico? No one person or entity seems to be in 
charge, and it is fostering a chaotic and ineffective effort to 
restore power on the island. And I want answers, and so do many 
of my colleagues on both sides of the aisle.
    I am also troubled by the maze of contracts with numerous 
companies for overlapping missions, a patchwork that is failing 
to turn the lights back on in Puerto Rico. And that needs to 
change now. I am deeply concerned by the terms of the contract 
PREPA signed with Whitefish and Cobra Acquisitions, which went 
so far as to bar PREPA from holding the companies liable for 
delayed completion of grid repair work or letting the 
Government audit their work. Now, Governor Rossello has since 
taken steps to have the Whitefish contract canceled, but we 
need to learn more about how these contracts are being awarded 
and whether the bidding process is truly competitive. That is 
why Chairmen Walden and Upton and Ranking Members Rush, 
DeGette, and I have requested documents and a briefing from 
Whitefish, so we can learn more about how that troubling 
agreement materialized.
    Additionally, FEMA issued a statement that said it had no 
involvement in the development of this contract. Well, my 
question is, why not? The Federal Government should be engaged 
in the contracting process of large-scale rebuilding contracts 
for which U.S. taxpayers will ultimately foot the bill. The 
Federal Government needs to step up and take charge to expedite 
power restoration efforts. Missions like this are why we have a 
strong Federal Government. And simply put, the Trump 
administration needs to be doing more. If we can't get the 
power turned back on soon, more people are going to die. This 
is a humanitarian crisis, and our Government owes it to the 
citizens in these Territories to do everything it can to fix 
it.
    And while restoring power quickly is the most urgent 
concern, it is also crucial that the grid in Puerto Rico and 
the U.S. Virgin Islands be rebuilt with more modern energy 
technology focused on increased resiliency, energy efficiency, 
and renewable energy. Replacing the old grid as it stood before 
the storm will cost taxpayers more money and do nothing to make 
electricity in Puerto Rico more reliable or affordable.
    So, as Congress prepares the next emergency spending bill, 
we must make changes to the current law to enable the 
rebuilding to occur in a way that lays the groundwork for 
constructing a modern electricity grid in the Territories. 
Failing to invest wisely in Puerto Rico now will only cost all 
taxpayers more down the road. And we must consider innovative 
ways for turning around Puerto Rico's situation, including 
alternatives to PREPA for overseeing the rebuilding and 
operation of the grid, and all ideas, from privatization--which 
I am not really a fan of--but from privatization to creation of 
a new Federal Power Marketing Administration. All these things 
have to be up for discussion. And whatever road we go down must 
have buy-in from the Puerto Rican people and the Government.
    I don't know if anybody wants my minute that I still have. 
If not, Mr. Chairman, I will yield back.
    [The prepared statement of Mr. Pallone follows:]

             Prepared statement of Hon. Frank Pallone, Jr.

    Mr. Chairman, thank you, for convening today's hearing 
reviewing the disastrous 2017 hurricane season, which has 
wreaked havoc on many parts of our country. I am grateful to 
former Senator Nieves of Puerto Rico and Mr. Rymer of the 
Virgin Islands for coming here today, but disappointed that the 
committee did not even receive a response to its outreach to 
the Puerto Rico Electric Power Authority (PREPA). I have 
serious concerns not only about how PREPA has overseen the 
effort to restore power in Puerto Rico, but also more broadly 
on how PREPA has managed--or more accurately, mismanaged--the 
grid in Puerto Rico over the years.
    Today we are focusing on the energy infrastructure recovery 
efforts, and I must say that accounts from the areas affected 
by these storms paint a dire situation that completely 
contradicts the often rosy stories that come from the White 
House. The truth is that, taken together, Puerto Rico and the 
Virgin Islands are currently experiencing the largest blackout 
in American history. And, this nightmare for our fellow 
citizens is far from over.
    The central questions for us today should be: why it is 
taking so long to restore power in Puerto Rico and the Virgin 
Islands, and who is actually in charge of the effort to restore 
power to Puerto Rico? No one person or entity seems to be in 
charge, and it is fostering a chaotic and ineffective effort to 
restore power on the island. I want answers and so do many of 
my colleagues on both sides of the aisle.
    I am also troubled by the maze of contracts with numerous 
companies for overlapping missions-a patchwork that is failing 
to turn the lights back on in Puerto Rico. It needs to change 
now. I am deeply concerned by the terms of the contracts PREPA 
signed with Whitefish and Cobra Acquisitions, which went so far 
as to bar PREPA from holding the companies liable for delayed 
completion of grid repair work or letting the Government audit 
their work.
    Governor Rossell cents has since taken steps to have the 
Whitefish contract canceled, but we need to learn more about 
how these contracts are being awarded and whether the bidding 
process is truly competitive. That's why Chairmen Walden and 
Upton, and Ranking Members Rush, DeGette and I have requested 
documents and a briefing from Whitefish so we can learn more 
about how that troubling agreement materialized.
    Additionally, FEMA issued a statement that said it had no 
involvement in the development of this contract. My question 
is: why not? The Federal Government should be engaged in the 
contracting process of large scale rebuilding contracts for 
which U.S. taxpayers will ultimately foot the bill. The Federal 
Government needs to step up and take charge to expedite power 
restoration efforts.
    Missions like this are why we have a strong Federal 
Government--simply put, the Trump administration needs to be 
doing more. If we can't get the power turned back on soon, more 
people are going to die. This is a humanitarian crisis, and our 
Government owes it to the citizens in these Territories to do 
everything it can to fix it.
    While restoring power quickly is the most urgent concern, 
it is also crucial that the grid in Puerto Rico and the U.S. 
Virgin Islands be rebuilt with more modern energy technologies 
focused on increased resiliency, energy efficiency and 
renewable energy. Replacing the old grid as it stood before the 
storm will cost taxpayers more money and do nothing to make 
electricity in Puerto Rico more reliable or affordable.
    As Congress prepares the next emergency spending bill, we 
must make changes to current law to enable the rebuilding to 
occur in a way that lays the groundwork for constructing a 
modern electricity grid in the Territories. Failing to invest 
wisely in Puerto Rico now will only cost all taxpayers more 
down the road. And, we must consider innovative ways for 
turning around Puerto Rico's situation, including alternatives 
to PREPA for overseeing the rebuilding and operation of the 
grid. All ideas, from privatization to creation of a new 
Federal power marketing administration must be up for 
discussion. And, whatever road we go down, we must have buy-in 
from the Puerto Rican people and Government.
    Thank you. I look forward to hearing from our witnesses 
today.

    Mr. Upton. The gentleman yields back.
    At this point we are ready for the testimony. Thank you in 
advance or thank you for sending your testimony in advance. It 
will be made part of the record. We would like each of you to 
take no more than 5 minutes to summarize your testimony. At 
that point, when that is completed, we will be asking 
questions.
    We are joined first by Patricia Hoffman, the Acting 
Undersecretary for Science and Energy, Principal Deputy 
Assistant Secretary for the Office of Electricity Delivery and 
Energy Reliability, at the Department of Energy. Welcome. Thank 
you.

  STATEMENTS OF PATRICIA HOFFMAN, PRINCIPAL DEPUTY ASSISTANT 
     SECRETARY, OFFICE OF ELECTRICITY DELIVERY AND ENERGY 
 RELIABILITY, DEPARTMENT OF ENERGY; RAY ALEXANDER, DIRECTOR OF 
   CONTINGENCY OPERATIONS, ARMY CORPS OF ENGINEERS; DEANN T. 
WALKER, CHAIRMAN, PUBLIC UTILITY COMMISSION OF TEXAS; ROBERT F. 
    CORBIN, DEPUTY ASSISTANT SECRETARY, OFFICE OF PETROLEUM 
  RESERVES, DEPARTMENT OF ENERGY; AND FRANK RUSCO, DIRECTOR, 
 NATURAL RESOURCES AND ENVIRONMENT, GOVERNMENT ACCOUNTABILITY 
                             OFFICE

                 STATEMENT OF PATRICIA HOFFMAN

    Ms. Hoffman. Chairman Upton, Ranking Member Rush, and 
distinguished members of the subcommittee, I appreciate the 
opportunity today to discuss energy security and emergency 
response issues related to the 2017 hurricane season.
    The mission of the Office of Electricity Delivery and 
Energy Reliability is to develop innovative, cutting-edge 
solutions to ensure our Nation's energy infrastructure remains 
reliable, affordable, and resilient. In order to fulfill this 
mission, the Department of Energy leverages the technical 
capabilities of National Laboratories and partnerships with the 
key private sector stakeholders to focus on early-stage 
research and transformative projects.
    Our organization is also the lead for providing energy-
related expertise to the Federal Energy Management Agency, also 
known as FEMA, our interagency partners, and the 
administration, as part of the Department of Energy's emergency 
response activities. DOE serves as the lead organization for 
Emergency Support Function 12 under the National Response 
Framework and as the sector-specific agency for energy. As the 
lead for ESF-12, DOE is responsible for providing information 
and analysis about energy disruptions and to assist in 
facilitating the restoration of damaged energy infrastructure.
    During Hurricanes Harvey, Irma, Maria, Nate, we have worked 
with industry and the Federal, State, Territorial, and local 
partners to facilitate response and recovery. Overall, DOE has 
received 18 mission assignments and has deployed more than 110 
personnel to the response efforts. Each of these storms has 
presented unique challenges to the energy sector.
    With respect to Hurricane Harvey, we saw peak electricity 
outages of about 300,000 customers in Texas and Louisiana. 
While offshore and onshore, crude oil and natural gas 
productions were disrupted by the storm, the greatest impacts 
were to the midstream and downstream oil and refining sectors. 
At its peak, more than 4 million barrels per day of refining 
capacity, representing more than 20 percent of the U.S. 
refining capacity, was offline. It took several weeks for 
floodwaters to recede, but the refining systems in Texas and 
Louisiana have resumed normal operations. In addition, flooding 
closed two key injection points along the Colonial Pipeline, 
forcing the system to operate intermittently at reduced rates 
for several weeks before normal service was resumed.
    Hurricane Irma, the second category 4 hurricane to make 
landfall in the United States this year, caused approximately 8 
million electric customer outages from the Caribbean to the 
southeastern United States. At Irma's peak on September 11th, 
there were approximately 7.8 million customer outages in 
Florida. Three days later, on September 14th, power had 
restored to approximately 5 million customers, 64 percent of 
those customers. And five days later, restoration was at 98 
percent.
    DOE is also playing a significant role in supporting the 
restoration and recovery efforts in the U.S. Virgin Islands and 
Puerto Rico from Hurricane Maria. In Puerto Rico, the U.S. Army 
Corps does have the primary role in emergency restoration and 
rebuilding the infrastructure, but DOE has deployed personnel 
and equipment from the Western Power Area Administration to 
provide mutual assistance through a mission assignment from 
FEMA and is working to facilitate additional mutual assistance 
with industry.
    Days after Bruce Walker was confirmed as the Department of 
Energy's new Assistant Secretary for the Office of Electricity 
Delivery and Energy Reliability, he was on the ground in Puerto 
Rico assisting other DOE personnel in coordination with the 
Governor, PREPA, FEMA, and the Army Corps of Engineers. 
Recently, the Governor and PREPA have requested additional line 
workers and equipment necessary for the restoration of power.
    Secretary Perry and our DOE team look forward to a 
thoughtful conversation focused on our response and recovery 
efforts for this hurricane season, and a focus on reliability, 
affordability, and resilience of the electricity system from 
hurricanes as well as other extreme weather events.
    I would like to take a moment and thank the hard utility 
workers for their time and their efforts in responding to the 
hurricane season. But, like any event, there is always some 
hard lessons learned, and we look forward to improving our 
efforts.
    So, thank you, and I look forward to your questions.
    [The prepared statement of Ms. Hoffman follows:]
    
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    Mr. Upton. Thank you very much.
    Next, we're joined by Ray Alexander, the Director of 
Contingency Operations for the Corps of Engineers.
    Welcome.

                   STATEMENT OF RAY ALEXANDER

    Mr. Alexander. Chairman Upton, Ranking Member Rush, and 
members of the subcommittee, my name is Ray Alexander, Director 
of Contingency Operations, the U.S. Army Corps of Engineers. 
Thank you for the opportunity to testify today.
    The Corps conducts emergency response activities under two 
basic authorities, the Stafford Act and Public Law 84-99. Under 
the Stafford Act, we support FEMA under the National Response 
Framework as the lead Federal agency for Emergency Support 
Function 3, public works and engineering. ESF-3 provides 
temporary emergency power, roofing, and housing, debris 
management, infrastructure assessment, and critical public 
facility restoration.
    Under Public Law 84-99, we prepare for disasters through 
planning, coordination, and training with local, State, and 
Federal partners. We assist State and local entities to 
implement advanced measures that prevent or reduce storm event 
damages. We repair damage to authorized Federal projects and 
work with States and municipalities to rehabilitate and restore 
eligible non-Federal flood infrastructure to prestorm 
conditions.
    When disasters occur, Corps teams and resources are 
mobilized from across the command to assist local offices with 
their response to the event. As part of this mission, the Corps 
has more than 50 specially-trained teams supported by emergency 
contracts that perform the wide range of support missions I 
just described. These contracts are preawarded and can be 
quickly activated to execute many of these missions.
    This year the Corps has supported FEMA-led Federal response 
and recovery operations in multiple events, including 
Hurricanes Harvey, Irma, and Maria. FEMA directed 37 mission 
assignments to the Corps for Hurricane Harvey. Currently, the 
Corps has 195 employees deployed. The Corps assisted in 
temporary emergency power and continues to support the State of 
Texas in the development and implementation of a temporary 
housing project management plan. Debris teams led by subject 
matter experts continue to provide States and municipalities 
the technical assistance to define requirements and monitor 
debris removal and disposal operations in 15 counties.
    FEMA directed 81 mission assignments to the Corps for 
Hurricanes Irma and Maria. Currently, the Corps has over 1500 
personnel deployed. As of this morning, the Corps has completed 
over 1,000 assessments and over 500 temporary generator 
installations in the Caribbean. This includes 250 assessments 
and 150 installations in the U.S. Virgin Islands and over 750 
assessments and 400 installations in Puerto Rico. Under FEMA 
authority, we are assisting Puerto Rico with the operation and 
maintenance of critical non-Federal generators across the 
island as well.
    The Corps has completed over 14,000 temporary roofing 
installations in Florida and is on track to complete that 
mission by 4 November. We have also completed over 7,000 
temporary roofing installations in the Caribbean, including 
over 2500 in the U.S. Virgin Islands and 4700 in Puerto Rico. 
Roofing requirements have been extensive, requiring additional 
material and construction support, which initially slowed 
progress. We have adjusted. We have added additional capacity, 
and we are seeing daily improvements.
    Corps debris subject matter experts provided technical 
assistance to counties across Florida and Georgia in response 
to Hurricane Irma, and continue to provide oversight to five 
regions within the Florida Department of Emergency Management. 
The Corps is working to remove an estimated 1 million cubic 
yards of debris in the U.S. Virgin Islands and over 6 million 
cubic yards in Puerto Rico.
    The Corps works closely with the U.S. Coast Guard and the 
National Oceanic and Atmospheric Administration and local 
authorities to open harbors and navigation channels across all 
affected areas, critical to restoring commerce and the flow of 
commodities, and essential equipment to reach affected 
communities.
    The Corps worked closely with officials of Texas and 
Florida to manage local flood control reservoirs during a 
period of unprecedented rainfall. In Puerto Rico, Corps dam and 
levee teams inspected 17 priority dams and worked closely with 
the Puerto Rico Electrical Power Authority, PREPA, to stabilize 
a spillway feature, the Guajataca Dam. Additionally, the Corps 
cleared existing outflow conduits and placed emergency pumps to 
further reduce water levels in the dam, and restored flow to a 
critical treatment plant that supports the needs of over 30,000 
people.
    On September 30th, the Corps received a FEMA mission 
assignment under Stafford Act authority to assist PREPA in 
conducting emergency repairs to the power grid itself. We are 
partnering with PREPA. We have established a general officer 
and senior-executive-led task force to oversee work and provide 
technical assistance.
    The Department of Energy has embedded experts in our team 
and continues to assist in our efforts. Within two weeks of 
receiving this mission assignment, we awarded contracts for 
large-scale temporary power generation to stabilize the grid in 
San Juan and for additional line repair assets that will assist 
ongoing efforts by PREPA.
    The Corps remains fully committed and capable of executing 
other Civil Works activities across the Nation, despite our 
heavy involvement in these ongoing response and recovery 
operations. We also remain ready and poised to assist in future 
events, should they occur.
    This concludes my testimony, and I look forward to 
answering any questions you may have. Thank you.
    [The prepared statement of Mr. Alexander follows:]
    
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    Mr. Upton. Thank you very much.
    Next is DeAnn Walker, the Chair of the Public Utility 
Commission for Texas. You have got to be a happy woman today as 
well with the Astros.

                  STATEMENT OF DEANN T. WALKER

    Ms. Walker. Yes. Thank you very much for your invitation to 
appear here today.
    My name is DeAnn Walker. I am the chairman of the Public 
Utility Commission of Texas. I have happily held that seat 
since September 20th. So, I am new to this.
    I believe I have a unique perspective on restoration from 
hurricanes. The State Operations Center in Texas creates what 
they call a Tiger Team of utility personnel that is located 
within the State Operations Center to help with restoration, to 
coordinate with Federal/State officials throughout an event. I 
have now served three hurricanes in the State Operations 
Center. Hurricane Rita and Hurricane Ike, I was actually 
representing a utility in the State Operations Center. During 
Hurricane Harvey, I was working for Governor Abbott and was 
down in the State Operations Center working with the utilities 
to restore service.
    We believe that the electric industry and the 
infrastructure in Texas fared very well during Hurricane Harvey 
compared to past hurricanes. As has been stated, we had under 
350,000 at any one time. We had more than that, but the 
utilities were continually restoring service during that time. 
The longest we had any customers out was for two weeks, and 
that was in the Rockport area, which was the direct hit of the 
eye of Hurricane Harvey. So, it took the brunt of it. During a 
storm, the PUC, as I said, works with State, Federal, and local 
agencies to restore power.
    I wanted to focus the rest of my time on what we are taking 
as action items to better prepare for a new hurricane. Due to 
the amount of flooding that we had, some cities and towns, 
areas received 60 inches of rain throughout Hurricane Harvey. 
Many substations in our area flooded for the first time ever. 
So, we are looking at, and we moved in for the first time ever, 
mobile substations to help serve those customers. We are 
looking at whether or not it is prudent for the State as a 
whole, all of the utilities to get together and purchase these 
mobile substations to have on hand in such an event. We are 
also working with the utilities to elevate those substations 
when they rebuild them, so that we are taking care of hardening 
the system in the process of rebuilding.
    I have also asked the State to look at whether or not we 
can better utilize utilities within Texas to send equipment and 
personnel. We were drawing people from all over the United 
States under mutual assistance crews, which we greatly 
appreciate, but I would like us to look and see if we can rely 
on the Texans that we have. SPS in the Panhandle and El Paso in 
far west Texas never were called on to help, and obviously, 
they were closer than a lot of places.
    We have been working through the process with FEMA for how 
to interconnect their temporary housing, so that we could have 
one seamless process for all utilities to implement. We are 
trying to do that on the fly. I would like us to further 
address that process in the meantime before the next storm hits 
us.
    We also learned that not every utility is reporting outages 
consistently. In Texas we require that all utilities report 
outages to us and to DOE on a county- and ZIP-code-wide basis, 
but there is not consistency between the utilities on how that 
was being done. For instance, some of the flooded substations, 
once they had a plan to bring in the mobile substation, they 
took those outages and moved them to planned outages. So, they 
were no longer showing up as being impacted by the hurricane. I 
don't think that is an accurate representation. So, I have 
asked to look at that.
    There are many other things that we have started looking at 
to correct and to, hopefully, do better. I am running out of 
time. I wanted to, again, thank you for your time today.
    [The prepared statement of Ms. Walker follows:]
    
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    Mr. Upton. Thank you.
    Next, we are joined by Robert Corbin, Deputy Assistant 
Secretary for the Office of Petroleum Reserves, the U.S. 
Department of Energy.

                 STATEMENT OF ROBERT F. CORBIN

    Mr. Corbin. Chairman Upton, Ranking Member Rush, and 
distinguished members of the subcommittee, it is an honor to 
appear before you today to discuss the Strategic Petroleum 
Reserve.
    The Strategic Petroleum Reserve, or SPR, was established 
under the authority of the Energy Policy and Conservation Act 
in December 1975. At that time U.S. oil production was in 
decline, oil price and allocation controls separated the U.S. 
oil market from the rest of the world, and the global commodity 
market for oil as we know it now did not exist.
    Today the global oil market has changed the environment in 
which the SPR operates. Although domestic oil production has 
increased dramatically in recent years, the global oil market 
is the largest commodity market in the world, making U.S. 
consumers subject to global commodity price fluctuations. 
Regardless of U.S. oil import levels, a severe global oil 
supply disruption today would impact domestic petroleum product 
prices.
    In the event of a serious interNational oil supply 
disruption, offsetting disrupted supplies with SPR crude oil in 
concert with other countries that hold strategic oil stocks can 
help reduce an increase in interNational oil prices and the 
resulting adverse economic impacts that could otherwise occur.
    The SPR maintains and operates four major oil storage 
sites, two in Texas and two in Louisiana. The SPR's current 
crude oil inventory is approximately 670 million barrels stored 
in 60 underground salt caverns with a design capacity of 713.5 
million barrels. The SPR is designed to provide the capability 
to draw down and deliver crude oil from the storage sites to 
designated distribution points, a design drawdown rate of 4.415 
million barrels per day. The SPR can physically begin to draw 
down crude oil in as little as two days of notification, and 
taking into account the time required to meet sales 
requirements and draw down and deliver crude oil within 13 days 
of a presidential finding. SPR operating costs are less than 25 
cents per barrel of design capacity per year, the lowest 
reported cost among oil stock-holding Nations.
    As a member of the InterNational Energy Agency, or IEA, the 
U.S. has two primary oil stock-holding obligations. As a net 
oil importer, the U.S. must maintain oil stock-holding 
inventories equal to at least 90 days of net petroleum imports. 
As of June 30th, 2017, the U.S. held 149 days of net petroleum 
imports.
    The U.S. must also be able to contribute a proportionate 
share to an IEA collective action in response to an oil supply 
disruption, based on its percentage share of IEA oil 
consumption. As of June 30th, 2017, the U.S. must contribute 
43.2 percent of all barrels released during any IEA collective 
action.
    As global oil trade increases, the potential role of the 
SPR to help mitigate global supply disruptions expands, 
regardless of the level of U.S. net oil imports. Without the 
ability to replace disrupted oil supplies in the global market, 
global oil prices could increase significantly and the U.S. and 
global economy could be harmed.
    SPR infrastructure has performed capability to ensure the 
SPR has been able to respond to every emergency release 
situation presented throughout its history. However, SPR 
facilities are aging. A significant amount of infrastructure 
components are at or beyond their design life, and equipment 
will be further stressed due to nine consecutive years of 
congressionally mandated crude oil sales.
    Congress, recognizing the need to modernize SPR 
infrastructure, included provisions in the Bipartisan Budget 
Act of 2015 to address this concern by authorizing the drawdown 
and sale of up to $2 billion worth of SPR crude oil over a 4-
year period to carry out an SPR modernization program. In 
response, the SPR has initiated a major capital asset 
acquisition project to modernize aging SPR infrastructure for 
systems upgrades and equipment replacement to ensure the SPR 
can meet mission requirements for the next several decades.
    Hurricane Harvey severely impacted U.S. Gulf Coast crude 
oil infrastructure, closing refineries, ports, and supply 
pipelines. Many impacted refiners were operable following the 
passage of Harvey, but in some cases were unable to secure 
crude oil feedstock to recommence or continue operations, 
resulting in multiple requests for emergency exchanges of SPR 
crude oil. After assessing prevailing supply conditions and 
consulting with other Federal agencies regarding the status of 
crude oil infrastructure, the SPR received approval from the 
Secretary of Energy to execute six emergency exchange 
agreements. First deliveries of crude oil were provided on 
August 30th, just two days after the initial request was 
received. Deliveries to the remaining companies also commenced 
within days after those requests were received and continued 
until deliveries totaling 5 million barrels were completed on 
September 28th. These emergency exchanges helped alleviate the 
loss of crude oil supply, allowing the affected refiners to 
begin and/or continue operations that otherwise would have been 
halted due to the impacts of Hurricane Harvey.
    This concludes my statement. Thank you for the opportunity 
to speak with you today about the SPR, and I look forward to 
answering any of your questions.
    [The prepared statement of Mr. Corbin follows:]
    
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    Mr. Upton. Thank you very much.
    Lastly, on the first panel we are joined by Frank Rusco, 
Director of the Natural Resources and Environment from the GAO. 
Welcome.

                    STATEMENT OF FRANK RUSCO

    Mr. Rusco. Chairman Upton, Ranking Member Rush, and members 
of the subcommittee, thank you for the opportunity to discuss 
our past and ongoing work on energy resilience and particularly 
the effectiveness of the Strategic Petroleum Reserve in 
responding to domestic petroleum supply disruptions caused by 
extreme weather and other events.
    The SPR was created at a time when global oil supply was 
dominated by OPEC and oil markets were characterized by long-
term contracts with fixed prices. At that time a global oil 
supply disruption, as occurred during the Arab oil embargo, had 
the effect of physical oil shortages and in the United States 
and elsewhere long lines at the gas pump. It made sense at the 
time for the SPR to be comprised of crude oil centrally held in 
cheap salt dome storage in Louisiana and Texas, near the 
Nation's largest refining centers.
    Today global oil markets are robust, and prices change to 
accommodate supply and demand, so that physical shortages and 
long lines are less of an issue. In addition, the use of the 
SPR has been primarily in response to domestic supply 
disruptions, particularly those caused by extreme weather 
events, rather than global supply shortages. My remarks will 
focus on how well the SPR is able to respond to these domestic 
supply disruptions.
    The SPR has been partially successful in responding to 
domestic supply disruptions in instances when Gulf Coast 
refineries and pipelines are operational but crude oil supplies 
to these refineries have been disrupted. For example, this year 
following Hurricane Harvey the SPR was able to supply several 
refineries with crude oil by pipeline while shipping ports were 
closed.
    However, the SPR has been less effective in responding to 
reductions in petroleum products in the rest of the country, as 
has occurred multiple times when hurricanes have shut down 
refineries or shut down power to other petroleum 
infrastructure. In this latter cases, including following 
Hurricane Harvey when as much as 34 percent of the Gulf Coast 
refining capacity was shut in, the real supply problem was 
gasoline, diesel, and jet fuel, and the SPR has only a small 
reserve of gasoline in the Northeast and no other petroleum 
product reserves. As a result, the SPR cannot provide needed 
petroleum products to Florida, the Eastern Seaboard, and other 
regions typically supplied by Gulf Coast refiners.
    DOE has recognize the desirability of having regional 
reserves of petroleum products. For example, in 2014, DOE 
identified five regions that are vulnerable to petroleum 
product supply disruptions. These include the West Coast, which 
is vulnerable to earthquakes and tsunamis, parts of six 
Midwestern States vulnerable to earthquakes, a number of States 
vulnerable to extreme cold weather, and the entire coast from 
Texas up to Massachusetts that is vulnerable to hurricanes.
    With the exception of the small gasoline reserves held in 
the Northeast, there are no other petroleum product reserves 
held by the SPR in any of these vulnerable regions. Further, 
while DOE has recognized these vulnerabilities and conducted 
some studies of alternatives to the current composition and 
configuration of strategic reserves, it has not completed these 
studies. As a result, DOE cannot determine the efficacy of 
creating regional petroleum product reserves.
    In contrast to how the SPR is configured, most other 
countries with strategic reserves have chosen to hold 
significant quantities of petroleum products in addition to 
crude oil, and some have chosen to spread these reserves out 
across their countries to be closer to centers of demand. For 
example, Germany chooses to hold about 55 percent of its 
strategic stocks as petroleum products. France spreads its 
reserves across seven geographic zones that enable it to 
distribute petroleum products to distribution networks all over 
the country.
    The United States has benefitted from European strategic 
stocks of petroleum products during past hurricane damage to 
Gulf Coast refining and production infrastructure. For example, 
in response to Hurricane Katrina in 2005, as prices of gasoline 
rose across the United States, shipments of gasoline from 
Europe began arriving on the East Coast within days. This 
mitigated the economic effects of the hurricane-caused refinery 
and oil production shutdowns.
    As DOE undertakes a modernization program of its existing 
systems, this committee and others have requested that we 
undertake an evaluation of the SPR, its size, composition, 
location of reserves, and options for improving its 
effectiveness. We will report our findings in the next few 
months.
    Thank you. This concludes my oral remarks. I will be happy 
to answer any questions you may have.
    [The prepared statement of Mr. Rusco follows:]
    [
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
    
    Mr. Upton. Well, thank you all. At this point we will move 
to questions from the dais.
    Mr. Alexander, you said in your testimony that the Corps is 
overseeing the work that is done by PREPA in Puerto Rico. I 
would like to ask the question, how has that gone? Because this 
subcommittee has tried to contact PREPA both by email and 
phone. They are not answering. There is no heartbeat that we 
are getting back. So, how has that oversight gone?
    Mr. Alexander. Sir, perhaps I misstated. We have a task 
force--again, general officer, senior-executive-led--that is 
overseeing our mission to restore the grid, as assigned by 
FEMA. What we are doing with PREPA, though, is we are working 
in coordination and collaboration with them, so that we can 
have well-defined, focused areas of operation. So, we are not 
working in each other's area and we ensure that there are no 
gaps. We are only working with PREPA; we are not working for 
PREPA, but we are working in coordination with PREPA.
    The oversight of the Corps' mission assignment we believe 
is going well. Again, we were assigned this mission on 30 
September. Within 18 days, we were able to award three major 
contracts, one for temporary power generation, two 30-megawatt 
power plants to be put in the vicinity of the Palo Seco Power 
Plant near San Juan, and restore the power grid around San 
Juan. Those generators have arrived. They have been installed, 
and we have additional load on the grid in the greater San Juan 
area as of several days ago.
    The other two contracts focused on line repair, 
transmission distribution/line repair. A larger contract to 
Fluor, a $240 million contract. They have boots on the ground 
today. They are conducting assessments. They are starting to 
have crews arriving. I believe, as I said in my testimony, we 
are ramping up quickly, 620 by the end of this weekend, and 
that number will double by mid-November.
    And then, we also have a company named PowerSecure. They 
are fully engaged and will be--they, too, have assessment teams 
on the ground. Their equipment is actually en route by sea now 
on a MARAD, Ready Reserve Fleet vessel that should arrive at 
Ponce port on 3 November.
    Mr. Upton. Did the Corps have any advance knowledge of 
working with PREPA prior to the contract that they established 
with Whitefish and Cobra? Were you aware of that contract 
before it was signed?
    Mr. Alexander. No, sir, we were not. We were engaged in our 
temporary power mission under the Stafford Act, and we have 
been working that since the 6th of September. The news that 
PREPA had independently committed in a contract to another 
company, we were not consulted; we were not aware.
    Mr. Upton. You indicated in your written testimony that the 
temporary housing plan includes establishing--this is as it 
relates to Texas--20,000 travel trailers and 4,000 mobile 
housing units. I presume that most of those are for folks that 
were actually displaced, homeowners or families that were 
displaced. Do you know what that number is for Puerto Rico? 
It's 20,000 for Texas. Do you know what the number would be for 
Puerto Rico?
    Mr. Alexander. No, I do not, sir.
    Mr. Upton. Ms. Hoffman, I have met with a number of 
pharmaceutical/medical device companies, many with very large 
operations in Puerto Rico. We are all aware of the critical 
need to get those facilities back online. It is a public health 
priority because it is so critical for patients to ensure that 
their products that are being manufactured there don't go into 
a shortage. How are you incorporating medical manufacturing in 
an approach to restore the grid in Puerto Rico?
    Ms. Hoffman. So, thank you.
    Critical infrastructure, critical loads on an electric 
system is very important, utilities. In our conversation with 
the utilities, with FEMA and the interagency partners, we 
discussed what are some of those priority restoration efforts 
and helping with the communications, so that we understand 
where some of those needs are and where some of the activities 
should be with respect to restoration processes. So, those 
coordinations occur with FEMA and with the local utilities in 
the Territory itself.
    Mr. Upton. OK. Thank you. My time has expired.
    I recognize the ranking member of the subcommittee, Mr. 
Rush, for 5 minutes.
    Mr. Rush. I want to thank you, Mr. Chairman.
    Mr. Alexander, I am kind of curious, not ``kind'', I am 
very curious about your Army Corps of Engineers' lack of 
information about this Whitefish contract. You, the Army Corps 
of Engineers, were unaware of this contract, is that correct?
    Mr. Alexander. Yes, sir.
    Mr. Rush. The Governor says he was unaware of this 
contract.
    Mr. Alexander. I'm sorry, sir, did you say----
    Mr. Rush. The Governor of Puerto Rico has stated publicly 
that he was unaware of this contract.
    Mr. Alexander. The Governor of Puerto Rico said he was 
unaware?
    Mr. Rush. Right.
    Mr. Alexander. Sir, I am not privy to that. I do not know.
    Mr. Rush. Are you aware that this contract is being 
canceled or has been canceled?
    Mr. Alexander. Sir, I understand that the Governor has 
given the direction to terminate that contract. Whitefish and 
other contractors, they are completing the task, the last task 
they have been assigned. So, they are still working on the 
island.
    Mr. Rush. Do you have any information about who executed 
that contract?
    Mr. Alexander. No, I do not.
    Mr. Rush. Do you trust PREPA? Do you trust them?
    Mr. Alexander. Sir, I have no reason not to. Again, we are 
working in collaboration with them on restoring the power.
    Mr. Rush. Do you have any estimate in terms of how much 
additional dollars the cancellation of this contract will cost 
the American people?
    Mr. Alexander. No, I do not.
    Mr. Rush. All right. Secretary Hoffman, the economic 
consulting firm Rhodium Group concluded that Maria cost 1.25 
billion hours of electricity supply disruption to households, 
which they say is the longest disruption in recorded history. 
Do you concur with their finding?
    Ms. Hoffman. I will have to look at the information, but it 
is a significant duration for outage for Puerto Rico.
    Mr. Rush. And what is the best estimate on when power will 
be fully restored to both the U.S. Virgin Islands and Puerto 
Rico?
    Ms. Hoffman. So, that is information that the Governor as 
well as PREPA is looking at, as well as partnerships with the 
Army Corps of Engineers, on the supplies that are needed, the 
resources that are required for restoring power. Some initial 
indications are that for, I would say 50 percent--I believe the 
Army Corps has estimated that 50 percent of the island will be 
restored by the end of December, and that the significant 
portion of the restoration will occur later on.
    Mr. Rush. Mr. Alexander, can you give us some insight on 
your opinions about the timeline, the estimated timeline? There 
might be some others on the panel that might also have some 
idea about the estimated timeline for Puerto Rico and, also, 
the U.S. Virgin Islands.
    Mr. Alexander. Sir, as for Puerto Rico, we estimated 30 
percent of the prestorm load on the grid would be restored by 
30 October. We did achieve that metric on time before the 30th. 
I believe we are up over 31, 32 percent today. Our estimate is 
50 percent prestorm load restored by 30 November. And then, as 
we go on into the new year, we are estimating 75 percent by 31 
January.
    Mr. Rush. Anyone else want to add?
    [No response.]
    All right. Mr. Alexander, is the Corps currently involved 
in discussions with PREPA, or any other Government entity in 
Puerto Rico, to ensure that when the grid is repaired, it will 
meet construction--it will be a way to account some of the 
lessons learned from this ongoing catastrophe for the American 
taxpayers' dollars are not being wasted?
    Mr. Alexander. Sir, we are focused on executing the mission 
we have been assigned, which is the restoration of the grid to 
prestorm conditions, the load, and we are coordinating with 
PREPA as we do that. We actually, though, are working with the 
Department of Energy on what a more resilient grid might look 
like, as they lead the effort to develop recommendations and 
cost estimates. But, for now, we are executing our mission 
under the Stafford Act, which does not allow for any permanent 
construction or enhancement of the existing grid.
    Mr. Rush. I yield back, Mr. Chairman.
    Mr. Upton. The Chair will recognize the vice chair of the 
subcommittee, the gentleman from Houston, Texas, Mr. Olson.
    Mr. Olson. I thank the Chair.
    And welcome to all five witnesses. A special pony up to the 
new chairwoman of the PUC of Texas, Ms. DeAnn Walker. My 
daughter Kate is a junior at SMU, your alma mater, and she 
loves it.
    My first two questions are for you, Mr. Alexander, one 
about Harvey and one about Irma. First of all, Harvey. As you 
know, sir, I live in Fort Bend County, Texas. When Fort Bend 
floods, it floods. We have had four major floods in the past 3 
years. Our drainage district works hard 24/7, 365, to make sure 
our drainage ditches are maintained. After the first major 
flood in 2015, the Army Corps told our drainage district they 
need a Section 404 permit under the Clean Water Act to maintain 
the ditches. The maintenance of a drainage ditch is supposed to 
be exempt from the permitting process under Section 404. But 
the Corps disputed the exemption and referred the district to 
the EPA. The EPA agreed it is maintenance work and the county 
should be good to go. But here we are, 2 years and four floods 
later, with Fort Bend County still unable to fix this critical 
problem. And now, Harvey has made a bad problem much, much 
worse.
    These repairs can't wait. Texas and Fort Bend need to 
rebuild after Hurricane Harvey. Things are being made worse 
with erosion and piles of silt. We don't need red tape at the 
Corps hindering the maintenance project that should be exempt 
under Section 404(f)(1)(C) of the Clean Water Act.
    My question is, will you guarantee me that your office will 
work with my staff and local Fort Bend County officials, under 
Judge Bob Hebert, to get this fixed ASAP, so Texans can protect 
their livelihoods?
    Mr. Alexander. Sir, thank you. I acknowledge your concerns. 
I am generally aware of this issue in Fort Bend. While I do not 
have all the specific details here with me today, I can assure 
you and can guarantee you that the Corps remains committed to 
working with our partners and your office to resolve this 
issue.
    Mr. Olson. Great. ASAP, please.
    The next question about Hurricane Irma that follows up on 
comments and questions from my colleague from Illinois, Mr. 
Rush. Sir, have you ever talked to someone on the ground in 
PREPA? Have you, yourself, talked to someone on the ground 
PREPA about the situation in Puerto Rico?
    Mr. Alexander. No, sir, I have not.
    Mr. Olson. Wow, have not. OK.
    The second round of questions is for you, Ms. Walker. First 
of all, I want to thank you for your service to our State. I 
appreciate your work in guiding us through Harvey. And I know 
Drew Vincentchild at the PUC. You have been our PUC Chair for 
41 rather intense days, I do believe. And as you know, for a 
city like Houston, I want you to talk about how Harvey as being 
a storm event with heavy rain as opposed to wind and storm 
surge, and how does that change the impacts you have to 
address? And what was the biggest surprise you had to recovery? 
Can we help with that surprise to mitigate that, either DC or 
NGOs? How can we address your concerns/surprises after 
Hurricane Harvey with our grid there in Fort Bend County, 
Texas?
    Ms. Walker. Well, as you noted, wind damage is very 
different than flooding damage, and Houston did have the 
flooding damage during this hurricane. The biggest surprise was 
the amount of rain. There was substations such as Memorial 
substation that took on water that had never taken on water in 
the 50 years that it had been there. And so, we were having to 
come up during the storm with ways to address all of the 
flooding, moving crews. Frankly, they were using aquatic 
equipment that they had never used before to get to things 
because of the flooding.
    Houston, also, downtown experienced heavy flooding. I 
believe I heard that 83 of the downtown buildings lost power, 
and I think some still are without power. Luckily the medical 
center did not. We have reinforced the medical center time and 
time again since Hurricane Allison. It wasn't a hurricane, but 
since Allison.
    And so, I am not sure of anything that you all can pass 
here that would help us. We continue to learn from each storm. 
Each storm is different. Hurricane Ike was a wind event. It 
took, out of 2.2 million, it took out 2 million. It was a much 
different storm.
    Mr. Olson. Again, being a Member who lives in the area, I 
have to thank you so much because, when Harvey hit my house 
twice in two days, we never ever, ever lost power. So, thank 
you for that.
    I yield back.
    Ms. Walker. Thank you.
    Mr. Upton. The Chair recognizes the ranking member of the 
full committee, Mr. Pallone.
    Mr. Pallone. Thank you, Mr. Chairman.
    Obviously, in addressing the panel, I have to say it, 
express my concern that the Federal response so far is nowhere 
near where it needs to be. Reports indicate nearly 70 percent 
of Americans on the island are without electricity. The New 
York Times recently described the situation of Puerto Rico, 
quote, ``like going back in time''. Most of my questions are of 
Mr. Alexander and the Corps.
    Mr. Alexander, who is in charge of the effort to restore 
power in Puerto Rico and the Virgin Islands? Is it the Army 
Corps or another agency?
    Mr. Alexander. Sir, again, our mission assignment from FEMA 
is to restore the grid to prestorm condition in coordination/
collaboration with PREPA.
    Mr. Pallone. That is fine. I just wanted to get----
    Mr. Alexander. OK.
    Mr. Pallone. You answered my question.
    Is there a strategic plan for these Federal restoration 
efforts?
    Mr. Alexander. Sir, if you look at strategic beyond the 
prestorm restoration, that is being looked at by Energy and 
other departments and the interagency----
    Mr. Pallone. So, the DOE is more responsible for a long-
term plan, is that what you are saying?
    Mr. Alexander. For full, permanent grid restoration 
enhancement, yes, sir.
    Mr. Pallone. And you are more involved in trying to get 
things up and going?
    Mr. Alexander. Sir, we are involved in trying to restore 
the grid in different sectors as expeditiously as possible with 
concentration initially on San Juan and, then, out to seven 
larger municipalities on the island, and then, finally, 
preparing and transitioning to PREPA for permanent service.
     Mr. Pallone. All right. Now how many companies--yes, I 
understand the Corps has several contracts with private 
companies for restoration work--how many companies has the 
Corps contracted with to perform the grid-rebuilding work in 
Puerto Rico?
    Mr. Alexander. Sir, we have contracted with three 
companies.
    Mr. Pallone. And will the Army Corps provide the committee 
with copies of those contracts, so that we can get an 
understanding of their scope? Would you be willing to do that 
through the chairman?
    Mr. Alexander. Sir, I will have to speak to our contracting 
authority and see what is permissible because it is 
acquisition-sensitive material.
    Mr. Pallone. All right. If you can, we would appreciate it. 
I know I am acting through the chairman in asking you for it.
    We have heard varying reports as to how long it will take 
to restore power to the citizens of Puerto Rico. By some 
accounts, it will be many more months until power is fully 
restored. So, Mr. Alexander, when did the Army Corps receive 
its mission to repair Puerto Rico's grid from FEMA?
    Mr. Alexander. On 30 September.
    Mr. Pallone. And Hurricane Maria made landfall in Puerto 
Rico on September 20th. Do you know why it took FEMA 10 days to 
give the Army Corps its mission?
    Mr. Alexander. Sir, we were not involved in deliberation. 
We were executing our temporary emergency power at that time.
    Mr. Pallone. All right. Just on that issue, does the Army 
Corps mission assignment provide--well, I guess you did answer 
that. You basically said, if I understood, that the short-term 
repairs in San Juan and these other areas is under your 
jurisdiction, but the long-term and fully reconstruction of a 
more efficient and resilient grid, that would be more DOE, 
correct?
    Mr. Alexander. Yes, sir.
    Mr. Pallone. All right. So, then, let me turn to Ms. 
Hoffman, to the DOE witness. If the Army Corps is not 
responsible for making long-term improvements, is the DOE 
taking the lead on this effort?
    Ms. Hoffman. So, the Department of Energy is looking at 
strategies for long-term improvements with respect to 
strengthening the grid. So, ideas such as energy storage, 
microgrids or minigrids, options for rerouting power, better 
situational awareness, all those activities are activities that 
we are looking at. But, once again, the actual financing and 
implementation is the responsibility of the utilities or the 
governance structure that will be decided for Puerto Rico.
    Mr. Pallone. But you stated in your testimony that DOE is 
leveraging the National Labs to develop long-term solutions to 
improve resiliency. What is the status of that effort?
    Ms. Hoffman. So, the National laboratories, we have been in 
active discussion with the Grid Modernization Lab Consortium in 
looking at areas such as planning activities, situational 
awareness, looking at analysis-type activities, as well as 
hardening activities. What this is going to have to be done as 
is mirrored up with the existing rebuilding process and looking 
at how some of the innovative solutions can be married in and 
built upon the existing rebuilding. So, that is going to take 
time and it is going to have to run in close coordination. So, 
we have seven technical experts in Puerto Rico working with the 
Army Corps to understand the timing and the extent of where 
their activities are going and opportunities for the future.
    Mr. Pallone. All right. Thank you so much.
    Thank you, Mr. Chairman.
    Mr. Upton. The Chair will recognize the gentleman from 
Illinois, Mr. Shimkus.
    Mr. Shimkus. Thank you, Mr. Chairman.
    I want to try to go to three different directions real 
quick. But, Mr. Alexander, I am a former military officer. 
Someone has to be in charge. So, I think it is very troubling 
that we have you all there trying to restore the grid and you 
are not in consultation with PREPA. The basic question is, if 
you are going to call and yell at someone to get the job done, 
does anyone know who we are going to call? Mr. Alexander?
    Mr. Alexander. Sir, my job is really----
    Mr. Shimkus. Yes, you have been very good at trying to 
answer this tactfully. But who do we call?
    Mr. Alexander. FEMA.
    Mr. Shimkus. We call FEMA?
    Mr. Alexander. FEMA.
    Mr. Shimkus. OK. Do we get our answer?
    Mr. Alexander. It is the authority we are operating under.
    And I will say this: from our Chief of Engineers to our 
South Atlantic Division commanding general, and to a number of 
colonels that are on the ground in Puerto Rico, they 
collaborate and meet with PREPA on a daily basis.
    Mr. Shimkus. OK. Thanks. So, I think we probably should 
have FEMA here. That is who we should have had, FEMA, as far of 
this committee hearing. So, maybe we will do that as a 
followup.
    Because, obviously, we all know the history behind PREPA 
and the bankruptcy and their questionable practices and their 
ability even to provide power before the storm.
    Does anyone know why it took--and Puerto Rico is separate 
because it is an island; it is far away; it is hard. Other 
States usually have, with the utilities have mutual assistance 
agreements. And you will see folks flow. Does anyone know if 
PREPA had a mutual assistance agreement with any stateside 
utility? Does anyone know that?
    Ms. Hoffman. It is my understanding that PREPA had not 
asked for mutual assistance agreements. Early on in the storm 
they just did ask for it.
    Mr. Shimkus. Yes, I have been told it took five weeks, 
PREPA took five weeks to ask anybody for help.
    Ms. Hoffman. Yes, a letter was submitted two days ago, I 
believe, for mutual assistance. But, generally, the industry is 
very forward-leaning in discussing with the utilities and 
activating mutual assistance----
    Mr. Shimkus. Well, we see it all the time.
    Ms. Hoffman. Yes.
    Mr. Shimkus. I mean, the trucks are on the road, whether 
there is an ice storm, whether there is in my neck of the woods 
a tornado, whether it is hurricanes. I have members of my 
congregation who are utility workers, and they are gone. That 
is a disappointing statement.
    I also wanted to put on the record, I think we wanted the 
Nuclear Regulatory Commission to submit a letter for this 
hearing because the hurricanes did come through some of our 
locations where we have nuclear power plants, and we think that 
would help build the record of the resiliency, baseload power, 
the importance of that. And I would ask that, if we finally get 
a letter from the NRC, Mr. Chairman, that we are allowed to 
submit that for the record.\1\
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    \1\ The information has been retained in committee files and also 
is available at  http://docs.house.gov/meetings/IF/IF03/20171102/
106573/HHRG-115-IF03-20171102-SD010.pdf.
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    And the last point, I really want to go to Mr. Rusco and 
maybe Mr. Corbin. The crude oil world has changed significantly 
since the establishment of the SPRO. I have been here a long 
time, 20 years, and I think one thing is for sure: we have 
always bought high and sold low. Is that a safe statement in 
the history of the SPRO, in the purchase of crude oil? Mr. 
Rusco, do you want to answer that?
    Mr. Rusco. I think that, just by the nature of when it was 
established, you know, it was established after a crisis. 
Usually, when DOE has had authority to expand, it is----
    Mr. Shimkus. Quickly.
    Mr. Rusco [continuing]. After a crisis. And so, it has been 
at higher prices.
    Mr. Shimkus. So, we have a history of buying high and 
selling low?
    Mr. Rusco. At least buying high.
    Mr. Shimkus. And your testimony talked about refined 
products. In the world really now the need is for immediate 
refined product, not base crude oil. In the old days when we 
were worried about deploying forces to Europe and sea lanes 
being closed, and importation of crude oil, a SPRO made sense. 
Am I right, based upon your testimony today, that you are 
saying maybe regional systems--well, actually, regional systems 
which DOE was supposed to analyze, and that there would be more 
focus on refined product?
    Mr. Rusco. I think that it is fair to say that most other 
countries that have strategic reserves have chosen to do that, 
for the reasons that you state, yes.
    Mr. Shimkus. Thank you. I hope my colleagues will follow up 
on some of those questions. I have run out of time. I yield 
back.
    Mr. Upton. The Chair recognizes the gentleman from 
California, Mr. McNerney.
    Mr. McNerney. Well, I thank the chairman, and I thank the 
witnesses this morning.
    Mr. Alexander, you mentioned prevention as a part of the 
mission. Within the Stafford Act framework, can the electric 
structure of Puerto Rico be rebuilt to improve grid resilience 
and using sustainable technology?
    Mr. Alexander. Sir, the Stafford Act allows us to restore 
the grid to prestorm conditions, meeting U.S. Code, electrical 
code, in order to satisfy life, health, safety requirements. 
Some have interpreted that to mean we are making a more 
resilient or betterment on the system, but that is not the 
case.
    Mr. McNerney. OK. Ms. Hoffman, has there been a credible 
estimate of the cost difference between rebuilding a system 
that is resilient and just rebuilding the old system to look 
like it did before?
    Ms. Hoffman. There has not been a complete cost estimate, 
taking into consideration the amount of work that has been done 
and that is being planned to be accomplished from the Army 
Corps of Engineers. So, there has been discussion around 
different advanced solutions, but that needs to be baselined 
with the work and the building planout. So, that needs to be 
evaluated still.
    Mr. McNerney. So, it could be that building a system that 
is resilient and sustainable wouldn't cost much more than just 
rebuilding the old system up to code?
    Ms. Hoffman. I think the analysis has to be completed.
    Mr. McNerney. OK. Thank you.
    The Office of Electricity has worked on a State Energy Risk 
Assessment Initiative that helps States understand the risks to 
their infrastructure. Did the Virgin Islands and Puerto Rico 
have a risk profile before the hurricanes?
    Ms. Hoffman. I would have to go back and look into that. I 
am not sure whether they did do a risk profile with the State 
assessments.
    Mr. McNerney. Thank you.
    Mr. Stafford, is it true that the National Science 
Foundation facility at the radiotelescope has an infrastructure 
that supported FEMA operations subsequent to the hurricane?
    Mr. Shimkus. You said ``Stafford''.
    Mr. McNerney. Oh, Mr. Alexander? Excuse me. Thank you, my 
colleague from Illinois.
    Go ahead.
    Mr. Alexander. Sir, now that I know it was me you were 
talking to, could I ask you, please, to repeat the question?
    Mr. McNerney. Sure. Is it true that the National Science 
Foundation facility radiotelescope infrastructure survived well 
enough to serve as a FEMA operations center?
    Mr. Alexander. Sir, I am not aware of that.
    Mr. McNerney. OK. I was going to ask you what 
differentiated that facility that survived from facilities that 
did not survive. Does anyone have a clue to that question?
    Mr. Alexander. I do not.
    Mr. McNerney. No?
    Ms. Walker, you highlighted the inconsistencies in tracking 
outages in the system. Would better tracking of outages be 
beneficial? Or how would it be beneficial?
    Ms. Walker. It helps us determine where to deploy services, 
such as, we call them pods, but water, food, whether or not 
outages are going to be restored quicker, and we know how many 
in the area have outages. We are able to, then, deploy the 
needs for that community better with that knowledge; also, 
working with the Corps of Engineers on deploying temporary 
generators. It just helps us to understand where to deploy for 
those needs.
    Mr. McNerney. Do you have the authority to require 
utilities to report outages?
    Ms. Walker. Yes, we do.
    Mr. McNerney. Is that authority a State authority or is it 
a Federal authority?
    Ms. Walker. It is a State.
    Mr. McNerney. Thank you.
    Ms. Hoffman, how does the DOE go about helping utilities 
prioritize which lines, substations, and so on, should be put 
online first?
    Ms. Hoffman. So, thank you very much for the question.
    The utilities have a restoration plan as they look at their 
outage management system. They look at prioritization for 
transmission lines to get the most customers on as soon as 
possible and, then, work down into the distribution system. But 
they first must do damage assessments and assess really the 
extent of the damage on the system, and accelerating that 
damage assessment really helps a utility outline the 
restoration process.
    What the Federal Government does is look at where the 
critical infrastructure is and are there any special needs with 
respect to storing large loads or storing critical 
infrastructure, whether it be telecommunication facilities, 
hospitals. And so, that is an ongoing discussion. But it gets 
melded with a utility's restoration plan and the utility's 
commitment with respect to how they are doing the restoration.
    Mr. McNerney. I yield.
    Mr. Upton. The Chair recognizes the gentleman from Ohio, 
Mr. Latta, for 5 minutes.
    Mr. Latta. Well, thanks very much, Mr. Chairman, and for 
calling this hearing today. And thanks to our witnesses for 
being here.
    Ms. Hoffman, if I could ask you my first question, you 
noted that one of the reasons for the rapid electrical recovery 
in Florida was the nearly $3 billion in grid resiliency 
improvements since 2006. Could you elaborate as to what those 
improvements were, and will DOE be working with Florida going 
forward to identify additional hardening practices?
    Ms. Hoffman. So, thank you, sir, for the question.
    The investments by Florida really have stimulated from 
activities that looked at, first, situational awareness, so 
looking at advance meter and infrastructure to provide the 
situational awareness that we have been talking about. Because, 
once you have that awareness, you can do an outage management 
system. You can actually look at how you can advance and 
preposition crews for a restoration process. It also has 
allowed for advanced switching to be able to minimize the 
amount of customers without power; versus taking down a whole 
feeder system, you can really isolate damage on a system and 
look at restoration opportunities.
    Other things that the utilities have done is hardening 
their infrastructure by looking at stronger poles, looking at 
concrete poles, steel poles, versus your traditional wooden 
poles. But all these capabilities are pulled together with an 
advanced kind of communications and control system, but a 
situational awareness system that can help with the restoration 
process.
    Mr. Latta. OK. You are talking about the different types of 
poles. Are there other things that they were doing on 
hardening, did you say?
    Ms. Hoffman. So, with respect to substations--and this 
would probably go more for Sandy, but also looking at hardening 
substations and being able to----
    Mr. Latta. And how do they go about hardening the 
substations?
    Ms. Hoffman. Pardon?
    Mr. Latta. How do they go about hardening the substations?
    Ms. Hoffman. So, when hardening the substations, you really 
look at increased capabilities with respect to duration, being 
able to support prevention of damage from wind, but also from 
flooding. So, it goes back to supporting infrastructure, so 
that you don't see the flooding damage that can occur.
    Mr. Latta. OK. Thank you.
    Ms. Walker, if I could turn to you, can you elaborate on 
working with the Federal agencies after Hurricane Harvey? And 
could you see any improvements that need to be made between 
Federal, State, local, industry, all working together out 
there? Or what is your view as to what happened, and is there 
anything that can be improved on?
    Ms. Walker. I think there are improvements that we can 
make. My view is that the time to make those is before the next 
storm. I found myself in the State Operations Center addressing 
issues that I think are better to try to handle after the storm 
and get ready for the next one. Some have to do with the 
interconnection for the FEMA temporary housing. Some had to 
do----
    Mr. Latta. Could you elaborate on that, on the temporary 
housing, because I know I've seen different press reports on 
that, but would you elaborate on the temporary housing of FEMA?
    Ms. Walker. Once they bring in temporary housing, it is not 
set, usually, right at the meter that the house is on. So, the 
utilities have to set a new pole. There are processes in Texas 
for each utility, and my guess is throughout the country for 
each utility, on how those processes are to interconnect the 
new customer, a new facility.
    And we would like to streamline that for all utilities in 
Texas. We had five major utilities impacted by Harvey and, 
then, multiple coops and municipalities. And so, we are hoping 
to have one process for FEMA to have to go through, instead of 
multiple different processes. So, that is an example.
    Mr. Latta. OK. Any other examples you can think of that 
would be how to improve things out there?
     Ms. Walker. We understood, or I understood, during 
Hurricane Harvey that there were issues, chokepoints, as they 
were called during Hurricane Ike, related to the processes, 
inspection processes, for cities to get homes reconnected once 
they are rebuilt, once they are remodeled. And so, I think that 
is something we can address going forward, how those 
inspections are done, who does them, to make sure we have 
enough people on the ground.
    It was during recovery. It is not, to me, the time to try 
to be addressing things like that. And I just think that that 
is something we can look at going forward.
    Mr. Latta. OK. Well, thank you very much, Mr. Chairman. My 
time is just about expired, and I yield back.
    Mr. Olson [presiding]. The gentleman yields back.
    The Chair now calls upon the gentleman from Pennsylvania, 
Mr. Doyle, for 5 minutes.
    Mr. Doyle. Thank you, Mr. Chairman.
    Ms. Hoffman, welcome back to our committee. It is always 
nice to have another Penn-Stater here at the committee.
    Let me ask you, in your testimony you explained DOE's role 
in restoration and recovery efforts in those areas affected by 
recent hurricanes. A DOE piece from 2015 published in Power & 
Energy Magazine that is still on your energy.gov site explained 
that, and I quote, ``Both the frequency and intensity of these 
disaster events have been trending higher in recent years, with 
7 of the 10 costliest storms in U.S. history occurring in the 
last 10 years. These weather disaster events represent one of 
the most significant threats posed by climate change.'' Now 
that was published in 2015. And since that time, we have 
witnessed the most extreme month of hurricanes that has ever 
been recorded earlier this year.
    So, I want to ask you, how is the Department of Energy 
responding to this increasing threat of climate change and 
extreme weather events?
    Ms. Hoffman. So, the Department of Energy is looking at all 
hazards, including extreme weather, as we look at investment 
opportunities or research opportunities for advancing our 
electric grid. And so, a lot of our research focuses on 
advanced technologies, energy storage capabilities, advanced 
minigrids or microgrids, as they are called. We are looking at 
advanced capabilities that the utility industry can build and 
invest in for hardening and improving the infrastructure.
    Mr. Doyle. Yes, I mean, exactly. In fact, that article goes 
on to detail the SmartGrid R&D Program which is designed to 
improve grid resilience and, also, modernizing the grid through 
the adaptation and integration of advanced technologies.
    So, in your testimony you explain your recommendation for 
the rebuild as being formed in consultation with the National 
Labs. And a presentation from my NREL earlier this year 
explained the importance of distributed generation, calling it 
``a large factor in developing resiliency with clean energy 
technologies and solutions''.
    So, my question is, is the Department, in making 
recommendations to those that are helping rebuild the grid in 
Puerto Rico, which will essentially be a brand-new system, are 
you urging deployment of distributed systems and renewables?
    Ms. Hoffman. So, distributed generation, combined heat and 
power, which is probably the most efficient form of distributed 
generation, is an option that should be considered in any sort 
of restoration improvement process. But one of the things that 
we are going to have to think about moving forward is how are 
we going to repair systems if another emergency happens. As you 
look at Puerto Rico, which had, I believe, over 8,000 solar 
panels there, what is the process in which the Department of 
Energy and the restoration activities in the next event, how 
are we going to orchestrate the repair of those systems?
    As you look at an efficient restoration process, there is 
an advantage to restoring the core electric grid. So, 
microgrids might a good balance between the two of looking at 
siting generation closer to load, but I think it has to be an 
individual evaluation with respect to the state of the system 
and the opportunities from that point of view.
    Mr. Doyle. Thank you.
    Let me just ask anybody on the panel, does anyone have a 
comment regarding FEMA's resistence to authorizing 
reconstruction aid? My understanding is this makes local 
governments and local utilities ineligible for long-term 
grants. And I am also concerned, because Puerto Rico is only 
eligible for emergency services, that these contracts don't end 
up following Federal procurement rules and we end up with 
situations like Whitefish Energy. Has any of your agencies 
weighed in on this topic? Is there an expected timeline for 
action on this? Anyone?
    [No response.]
    I mean, FEMA authorized in 10 days in Houston, in Texas, 
and I believe in a couple of weeks in the Virgin Islands. But, 
yet, still, for some reason, this hasn't been fully authorized. 
They claim they are working on it; they are close to it. Could 
anyone explain what this holdup is and why it has taken so 
long?
    [No response.]
    I think you are right when someone said we should have had 
FEMA up here. FEMA should be sitting on this panel, too, 
because it seems like a lot of the questions we have need to be 
answered by them.
    Well, let me ask it. Do any panelists have suggestions for 
any highly beneficial action we could take to help expedite the 
rebuilding efforts in a prudent, sustainable manner? Can you 
give any suggestions to this committee on what we should be 
doing that we are not doing right now?
    Ms. Hoffman. Sir, if I may add some comments?
    Mr. Doyle. I am glad to see Penn State stepping up to the 
plate here and at least answering a question.
    [Laughter.]
    Ms. Hoffman. As we look forward to investing in resilience, 
I know it is something that the Administrator of FEMA is 
looking at, as well as the Department. It is, how do we build 
in resilience and how do we think about that upfront investment 
ahead of a disaster, and looking at what funds are available, 
to really think about investing for resilience?
    Mr. Doyle. The idea that our citizens are going to go 
another three months without electricity is just 
unconscionable, I think.
    I yield back.
    Mr. Olson. The gentleman yields back.
    The Chair now calls upon the gentleman from Ohio, Mr. 
Johnson, for 5 minutes.
    Mr. Johnson. Thank you, Mr. Chairman.
    I appreciate the opportunity to ask of this panel. A very, 
very important hearing that we are having today because we saw 
the effects of the hurricanes and how the destruction that 
occurred during and afterwards, how that affected not only the 
areas that were hit, but other regions of the country as well, 
since so much of our energy resources reside there on the Gulf 
Coast.
    So, Mr. Corbin, how much does the Northeast Gasoline Supply 
Reserve cost on an annual basis? Let's get that question out of 
the way first.
    Mr. Corbin. Thank you for the question, Mr. Johnson.
    For the Northeast Gasoline Supply Reserve, the average 
storage contracts, which are for leased commercial storage for 
the product, are approximately $19.60 per barrel per year. And 
when you include overhead costs, to include quality assurance 
and administration of your IT/sales platform, in the event you 
have to release the gasoline, it comes to a little over $20 per 
barrel per year, sir.
    Mr. Johnson. OK. So, is the higher per-barrel cost of 
storing gasoline versus crude oil a good use of taxpayer 
dollars, do you think?
    Mr. Corbin. That is really not for me to decide, whether 
that is a good use of the taxpayer dollars.
    Mr. Johnson. But you have got an opinion?
    Mr. Corbin. I will say, Mr. Johnson, that in terms of the 
cost of storage for refined products, the United States has, 
out of 14 countries that participated in benchmarking studies 
that are stock-holding countries, the U.S. has by far the 
highest cost for gasoline storage out of the 14 countries.
    Mr. Johnson. OK. All right.
    Also, Mr. Corbin, continuing on, the SPR is almost entirely 
located in the Gulf Coast region of the United States, limiting 
its ability to respond to disruptions in other parts of the 
country, particularly if we were to have a repeat of what we 
saw recently. For example, the West Coast has relatively few 
pipelines that are connected to the SPR, meaning that some 
petroleum products must be shipped by truck, barge, or other 
domestic methods or by tankers even from foreign countries. 
These modes of transport, obviously, are slower and more costly 
and limit the usefulness of the Strategic Petroleum Reserve. 
So, how would expanding, in your opinion, how would expanding 
the number of SPR locations across the country enhance the 
effectiveness of the SPR?
    Mr. Corbin. First, I would just like to make a correction 
to your statement, sir. There are no pipelines that directly 
connect the SPR to the West Coast of the United States.
    The SPR, as I mentioned in my testimony, our crude oil is 
stored in underground salt caverns in two sites in Texas, two 
in Louisiana. Salt cavern storage is very inexpensive. We have 
the lowest operating cost of any stock-holding country in the 
world for our crude oil. There are no salt domes along the West 
Coast of the United States. There are some outside of the 
immediate Gulf Coast area, but they are not significant. So, 
crude oil storage would be problematic on the West Coast.
    Mr. Johnson. So, you are basically saying--I don't mean 
just the West Coast; I mean other regions of the country as 
well. I mean, the question centered on the West Coast. So, you 
are saying, in your opinion, developing other storage areas for 
the SPR around the country in different regions would be 
problematic?
    Mr. Corbin. For crude oil storage. Now, in discussions that 
were mentioned by Mr. Shimkus earlier, and talked about refined 
product storage, the U.S. Government currently has two refined 
products reserves, the Northeast Gasoline Supply Reserve and 
the Northeast Home Heating Oil Reserve. They are both very 
small, 1 million barrels apiece. They are intended to meet 
regional supply disruptions.
    There are challenges associated with product reserves, 
regardless of the model that is used. Both of the product 
reserves that are currently in existence, they are, 
essentially, Government-owned refined product in leased 
commercial storage facilities. In any product reserve with that 
model, there is an initial refined product acquisition cost 
associated with it. In studies that we did in PADD 5, which is 
the West Coast, and in the Southeast U.S., my staff found that 
there is little to no spare commercial storage capacity. And as 
I mentioned previously, the leased commercial storage costs are 
high.
    Mr. Johnson. OK. All right.
    Mr. Chairman, I yield back.
    Mr. Olson. The gentleman yields back.
    The Chair now calls upon the gentlelady from Florida, Ms. 
Castor, for 5 minutes.
    Ms. Castor. Thank you, Mr. Chairman. And I want to thank 
Chairman Upton and Ranking Member Rush, and the professional 
staff, for bringing this hearing to be. And thanks to all of 
our witnesses.
    There is a very serious tension that the Congress has to 
address as soon as possible. On the one hand, we need to 
restore power in Puerto Rico and the U.S. Virgin Islands as 
quickly as possible, but, on the other hand, Congress has an 
overarching responsibility to protect the taxpayer from future 
losses by building a more resilient, modern, distributed grid 
with better technology, technology, by the way, that has 
largely been funded by the taxpayers that we see in our 
National Laboratories that is used by utilities and businesses 
all across the country.
    Senator Ramon Luis Nieves, who is in the audience and is 
going to testify on the next panel, is a former chairman of the 
Puerto Rican Senate Committee on Energy. He says the current 
grid is obsolete, the grid before the storm, before the 
hurricanes. He said in his testimony, ``Appropriating taxpayer 
money just to repair an old 20th century grid would be a waste 
of resources.'' In fact, Ken Buell, the Director of Emergency 
Response and Recovery with the U.S. Department of Energy, 
stated that, ``We really should think in terms of rebuilding at 
this point, not just repairing the old grid.''
    The problem that we have all got to grapple with is PREPA 
is largely in debt. They do not have the wherewithal now to 
take the lead on this. They have governance problems. Gosh, 
what else do we have to know after this Whitefish contract 
controversy? I think we have a very significant responsibility 
to protect the taxpayers here.
    A few weeks ago, there was a congressional briefing 
provided by the Department of Homeland Security, FEMA, and the 
U.S. Army Corps of Engineers was there. They also relayed that 
they only have the authority now to go in and make repairs, and 
not do the kind of rebuilding of a modern grid that needs to 
happen.
    In fact, Mr. Alexander, in your testimony you say that your 
mission right now is to repair the power system to its prestorm 
condition, is that correct?
    Mr. Alexander. Yes, ma'am.
    Ms. Castor. Ms. Hoffman, what kind of direction do you need 
from the Congress to begin to go beyond a planning stage and do 
something that your very own Director of Emergency Response and 
Recovery has said needs to be done? And do you agree that you 
need that authority to go beyond repairing?
    Ms. Hoffman. So, I think there has to be an ability for the 
Department of Energy to work closely with PREPA in planning and 
actively engaging and discussing what some of those advanced 
technologies solutions are. So, the forum has to be codified, 
so that there can be active engagement and discussion of what 
are the opportunities. I know that PREPA has their own plans 
and their own activities, but how do we really take the 
advancements and provide that?
    Ms. Castor. So, you think, yes, it would be helpful for 
Congress to provide additional clarity, so that you can move 
forward to do what, on a bipartisan basis, what experts have 
advised that needs to be done in Puerto Rico?
    Ms. Hoffman. Yes.
    Ms. Castor. And the Virgin Islands? OK.
    Ms. Hoffman. Yes.
    Ms. Castor. We have got to do this with a sense of urgency, 
though. Mr. Alexander, how do we do this? As you keep going on 
to repair, what kind of advice, what kind of clarity do you 
need from the Congress in maybe the next emergency aid package, 
maybe in something that would allow you to go beyond just 
repairing the old, obsolete grid and moving forward on 
something that would protect the taxpayers?
    Mr. Alexander. So, while we recognize that the prestorm 
grid was not in good condition, the current authorities under 
the Stafford Act, and the mission assigned from FEMA, limits us 
to restoring to prestorm condition, meaning U.S. Code. I think 
this is, ultimately, a policy decision. Do we need to relook at 
the Stafford Act? As written, it was----
    Ms. Castor. And Colleagues, let me--thank you very much--in 
previous emergency aid packages for Superstorm Sandy and for 
Katrina, it has been the Congress that has been able to go 
beyond the Stafford Act that limits the Government to just 
going and repairing what was, and building in, instead, a new 
resiliency, whether it is in housing or defense installations 
and things like that, those previous emergency aid package. We 
have never had a blackout and destruction of an electric grid 
the scale of this ever before in the country, and that is why 
this is something new this committee needs to work on together 
with our colleagues in the Senate and, hopefully, with DOE, as 
they have expressed they are already doing some of this 
planning. But, to put this into action, it is going to be our 
responsibility to actually pass that authorization in the next 
emergency aid package or before.
    And I yield back my time.
    Mr. Olson. My friend's time has expired.
    The Chair now calls upon the gentleman from the 
Commonwealth of Virginia, Mr. Griffith, for 5 minutes.
    Mr. Griffith. Thank you very much, Mr. Chairman. I 
appreciate it,
    Ms. Hoffman, during a hearing before this committee, 
Secretary Perry mentioned that microgrids could be a solution 
to quickly restore electricity after future natural disasters. 
I am also interested in how microgrid technology could be used 
to provide power to rural and rural mountainous areas of the 
country. Do you believe Puerto Rico could benefit from 
microgrids and, if so, how?
    Ms. Hoffman. So, thank you very much for the question.
    Microgrids provide an opportunity to bring generation 
closer to the load and be able to manage supply and demand on a 
more local basis. In Puerto Rico you have the generation on one 
side of the island and, of course, the load on the other side 
of the island. So, ultimately, you really would like to be able 
to create a minigrid or a microgrid. It would be able to 
balance that in a different form. But that does require 
generation, and it does require load management and advanced 
communications and controls to be able to manage that on a more 
localized basis. So, you look at things such as energy storage 
and other generation that can be meshed very well with a local 
distribution system.
    Mr. Griffith. Now would you see that as exclusive of the 
current type of system or would you see it as an ancillary 
except in times of disaster?
    Ms. Hoffman. So, ideally, I would love to think about how 
you build off of the existing system and capitalize on the 
existing investment, where it is electrically feasible. And 
then, once again, that requires close coordination with the 
existing infrastructure. Whenever utilities look at isolation 
or separation of the grid and look at microgrids, they are 
looking at utilizing the existing assets and being able to 
build upon those assets with new technology and new 
capabilities.
    Mr. Griffith. And if you are suddenly cut off, as we have 
seen in Puerto Rico, from your supply of either electricity or 
the fuel to produce that electricity, doesn't that require that 
the microgrid also have some kind of a fuel source that it can 
tap into in cases of emergency?
    Ms. Hoffman. Absolutely. You need a fuel source. You need 
redundancy. You need to be able to ensure reliability of the 
microgrid. Whether it is a utility-owned or a private-sector-
owned, you have to have that redundancy and capability for your 
customers.
    Mr. Griffith. I appreciate that.
    What are the current limitations associated with the 
microgrid technology, if any?
    Ms. Hoffman. So, some of the current limitations are really 
looking at microgrid controllers to be able to have an ability 
from a standards form to be able to look at control of the 
microgrid, looking at cybersecurity. Regardless of who owns the 
electric grid and how the electric grid is developed, you have 
to be secure. You also have to have the capability to 
dynamically manage supply and demand. So, looking at some of 
the advanced control solutions and things along those lines, as 
well as the generation technology.
    Mr. Griffith. Now let me ask you this: can you envision 
that a microgrid might be as small as, say, just a power source 
that would handle a hospital and its needs or a factor and its 
needs for short periods of time, as a part of the system as a 
whole, but, then, also, in times of emergency be able to take 
care of those needs where we have seen problems in Puerto Rico 
and other places?
    Ms. Hoffman. So, absolutely. We have seen microgrids at 
university campuses, at hospitals. So, it can be as small as 
one wants to define a microgrid, but also can be larger from a 
minigrid point of view, if you want to support multiple 
services in a locality.
    Mr. Griffith. And I would assume that, based on what we 
have already discussed, that if you had, if for some reason in 
the natural disaster your fuel source was damaged, but the rest 
of the equipment was still good, that it would be easier to 
drop in the fuel, for the Federal Government to come in after 
the disaster and drop in the fuel than it would if you drop in 
a whole new system, isn't that correct?
    Ms. Hoffman. I think that has to be evaluated on a system 
basis, to be fair.
    Mr. Griffith. OK.
    Ms. Hoffman. I mean, you are bringing in a lot of fuel, and 
it kind of comes down to what really is it required for a cost-
effective restoration. What we are talking about is getting the 
power back on for as many customers as possible as efficiently 
and as effectively as possible. And so, in some cases that may 
be putting in, re-establishing a grid system and a grid 
network. In other cases in a localized community that is very 
far and isolated, it may be putting onsite generation there and 
creating a minigrid in the near term until lines and power can 
be restored from a main grid point of view.
    Mr. Griffith. And I appreciate that. Of course, in my neck 
of the woods where we have a lot of coal and some natural gas, 
but a lot of coal, we think that might be an answer for us, and 
maybe for others, to have that fuel source available and have 
the big microgrid ready to go.
    With that, Mr. Chairman, I appreciate it very much and 
yield back.
    Mr. Olson. The gentleman yields back.
    The Chair now calls upon the gentleman from Iowa, Mr. 
Loebsack, for 5 minutes.
    Mr. Loebsack. Thank you, Mr. Chair.
    Thanks to the panel today for your excellent testimony, and 
we have had a lot of great questions.
    I guess I want to join in with everyone else in expressing 
the fact that I was heartbroken by the devastation of these 
most recent storms. I think it is unfortunate that we are 
probably going to see a lot more of this down the road. So, we 
are going to be faced with these issues, I think, across the 
country.
    And many of us represent districts that have already been 
affected over the years by this kind of devastation. I 
represented Cedar Rapids, Iowa, for 6 years. Back in 2008, we 
had the Flood of the Century or the flood of whatever number of 
centuries, and the river crested at 31 feet, 9 feet over the 
previous record. There was $2.5 billion damage done immediately 
in Cedar Rapids, the economic loss of probably the same. And 
they have been through a lot, like a lot of communities around 
this country, and just most recently what we have seen in 
Puerto Rico and Texas and Florida.
    I do want to, I guess, address my concerns more to Mr. 
Alexander than anybody with respect to the Corps. You know, the 
Corps I know ranks the projects, and we are going to have a lot 
of projects coming up, what we have seen recently, projects for 
reconstruction, for flood mitigation. I run the benefit/cost 
ratio, and it has to be at least 1-to-1, as you know.
    Cedar Rapids was 1.2-to-1. We authorized the project to go 
forward in 2014, but we haven't seen any movement on it in 
terms of funding. And this is going to happen in these other 
instances, too. We are going to have a lot of challenges, sort 
of where to prioritize, where to put the money.
    But I have a lot of concerns with this benefit/cost ratio. 
It seems awfully bureaucratic to the folks who are living in 
these communities when they want to prevent floods in the 
future. Can you address that issue and give us any hope at all 
that, not just Cedar Rapids, Iowa, but these communities that 
are going to be faced with flood mitigation down the road might 
get some relief and actually see some projects built?
    Mr. Alexander. Sir, I am familiar with benefit/cost ratios 
and prioritizing and racking and stacking of projects, and the 
needs are many, but the budget is limited. But my focus is on 
contingency operations. And so, to adequately address your 
question, I would have to refer to our Civil Works personnel. 
So, I could have my staff coordinate with them.
    Mr. Loebsack. Yes, I suspected that might be the case, but 
I am going to go ahead and submit a question on the last. Then, 
if you can get us an answer from the relevant person at the 
Corps, that would be great. Again, I just want to bring up this 
issue more than anything else, because going forward this is 
going to cost, as we know, billions of dollars for 
reconstruction in these communities. And a lot of them are 
going to face the same questions that Cedar Rapids faced since 
2008, and a lot of other communities around the country, and it 
is something that we are going to have to pay close attention 
to and we are going to have to resolve that issue, because 
folks are going to be depending upon those reconstruction funds 
to make sure that they can go forward with their communities.
    So, thanks to all of you.
    And thank you, Mr. Chairman. With that, I will yield back.
    Mr. Olson. The gentleman yields back.
    The Chair now calls upon the patient gentleman from West 
Virginia, Mr. McKinley, for 5 minutes.
    Mr. McKinley. Very patient, very patient. Thank you, Mr. 
Chairman.
    Mr. Olson. Very patient.
    Mr. McKinley. Mr. Chairman, given the aftermath and all the 
discussion here we have had about the natural disasters we have 
had in Florida, Texas, Louisiana, Puerto Rico, I really want to 
applaud the Department of Energy's efforts to refocus the 
narrative and the discussion about reliability and resiliency, 
because really it underscored how serious that problem is if we 
don't address it. So, thank you for what you are doing, and for 
Secretary Perry, for focusing on that, because I think that 
could have some impact.
    But my question, a little along the same line, has to do 
with the petrochemical industry in the Houston and Louisiana, 
all of the Gulf Coast, where we were so hard hit when that 
Category 4 hit there that it wiped out or shut down 17--I think 
there are 23 crackers down in that area--17 of them were shut 
down. One of them is still out. Sixty percent of our production 
of polyethylene and propylene were lost for a period of time. 
It showed how vulnerable we are in that area.
    And I know that, in contact with folks that have reached 
our office, because of that slowdown, because of the lack of 
cracker facilities to be able to provide the ethylene and 
propylene around the country, companies all across America that 
use their plastic resins are slowing down as a result. One 
company, particularly, in my district was working seven days a 
week. It is now down to five because it can't get the plastics.
    So, this thing is serious about it. What we have done, or 
what I think DOE maybe has an interest--and I would like to 
hear more from you--is that, rather than taking a page from the 
Strategic Petroleum Reserve of having it all in one location, 
what if we were to locate an ethane storage up in the northern 
Appalachian area, right where the Marcellus and the Utica shale 
formations are located, so that we could have a secondary 
supply, a secondary source, to be able to provide that, the 
petrochemical supplies of material for around the country?
    Do you have a thought about that from DOE's position, here 
they may be on having a secondary? It is not replacing Houston 
by any stretch. It is just having something that is in another 
location, so it is not vulnerable to the weather.
    Ms. Hoffman. So, Congressman, you bring up an important 
issue. It is location, location, location. Diversity is very 
important. And as we look at any sort of, whether it is fuel 
product, chemical product, having and thinking about having 
flexibility in where that product is developed also looks at 
our security and resilience for the Nation. So, I understand 
that in the Appalachian area there is a lot of natural gas 
resources and a byproduct of natural gas and the ability is 
ethane. And so, I know that the Secretary had a roundtable 
discussion and is looking at the opportunity. But it brings up 
the important point that we need to think about diversity and I 
wanted to say ``generation diversity,'' but product diversity 
in the United States.
    Mr. McKinley. Following up on that is that, during last 
year's appropriation process, our office had introduced an 
amendment to the appropriation bill to see that a study was 
undertaken to confirm whether or not there was an interest or 
possibility and potential for having it in the Marcellus and 
the Utica shale formations. That has been since, I think it was 
May. Do you have a sense? Can you give me a status on how far 
along, if it has been undertaken yet, to make a determination 
of the feasibility of locating a secondary ethane storage?
    Ms. Hoffman. So, I understand the Department is undertaking 
a study in this area, and it is my understanding that this 
study will be completed in 2018.
     Mr. McKinley. Do you have an idea when in 2018? In 
December or is that going to be in September or October?
    Ms. Hoffman. I don't have that.
    Mr. McKinley. OK.
    Ms. Hoffman. I will get back to you on that answer.
    Mr. McKinley. If you could back to me, I would appreciate 
it.
    And I yield back. Thank you.
    Mr. Olson. The gentleman yields back.
    The Chair now calls upon the gentleman from the Bay State, 
the Bay Line State--I'm sorry--the Old Line State, Mr. 
Sarbanes, for 5 minutes. I apologize.
    Mr. Sarbanes. All those names work.
    Thanks to the panel.
    I wanted to ask you, Mr. Alexander, to step back in terms 
of the Corps' relationship to these disasters that have been 
occurring with more frequency, and give me a sense of how much 
the Corps' mission and effort and sort of the deployment of its 
various projects has changed over the last few years in either 
response to the disasters that we are seeing, these natural 
disasters, or in anticipation that the frequency of them is 
going to increase. Is that an analysis that is happening? Can 
you cite some trends in terms of the Corps' projects around 
this, the kind of requests that come in that are related to 
resiliency and adaptation, and so forth, in addition to just 
efforts to respond to things that happen? So, if you could give 
that kind of 30,000-foot perspective, that would be helpful.
    Mr. Alexander. Thank you, sir.
    First, every year following a storm season, we do an after-
action review and we identify lessons learned, and we work to 
develop and establish best practices, so that we can improve 
ourselves and train accordingly. How can we work with State and 
local governments to help them prevent and work toward 
mitigation of a disaster?
    We are always looking at how we can improve our critical 
infrastructure. We have an aging infrastructure, as you know. 
So, that is a separate issue. We acknowledge that 
infrastructure needs to be resilient in order to withstand 
storms such as this, flooding on the Mississippi, tornadoes out 
in the Midwest. We are looking, as we move forward and develop 
and study projects and future projects, we are looking at ways 
to ensure that a greater degree of resilience is incorporated 
in those designs.
    Mr. Sarbanes. Are you seeing an increase? Is there a marked 
increase or at least something measurable in the kinds of 
proposals that are coming into the Corps that relate to these 
extreme weather events, either responding to something that has 
happened or projects that are anticipating increased exposure 
from these events? And has the Corps' kind of scoring system 
for projects been adjusted in any way relative to what has been 
happening with these kinds of disasters and weather events?
    Mr. Alexander. I am not in a position to adequately address 
your question. I can say, I mean, we do every year; we have 
requests for additional flood damage mitigation projects. How 
can we increase the resilience in levee systems and support and 
mitigate flooding in low-lying areas, flood plains, things of 
that nature?
    Mr. Sarbanes. I would appreciate it, if it were possible, 
to go back to the Corps, and maybe after the analysis following 
this hurricane season has been completed, to see if you could 
give us some information about trends over the last few years 
in terms of the number of projects that fall into that kind of 
a basket and, as I said, whether the Corps is putting that 
analysis and thinking into a strategic plan for the Corps going 
forward that may lead to creating different sets of priorities 
for project based on some of these issues. So, if that is 
something, certainly getting that analysis--I assume we can get 
some report on the analysis that is done on an annual basis--
that would be helpful, but, then, any additional perspective 
you can bring on those kinds of trends would be helpful.
    Mr. Alexander. Yes, sir, we will.
    Mr. Sarbanes. Thanks. I yield back.
    Mr. Olson. The gentleman yields back.
    The Chair now calls upon the gentleman from Missouri, Mr. 
Long, for 5 minutes. Welcome back, Billy.
    Mr. Long. Thank you, Mr. Chairman.
    And, Ms. Hoffman, 10 or so years ago, my hometown of 
Springfield, Missouri, we received a devastating ice storm 
where there were folks out of power for 10, 12 days, two weeks, 
whatever, and the utility companies came in from all over to 
help us in that situation. I know the recent situation in 
Florida, from the Washington, DC, area here in Maryland, 
Virginia, and Springfield, Missouri, again sent crews down to 
Florida to help in that situation. So, I know what it is like 
whenever people--neighbors helping neighbors, so to speak.
    You note in your testimony that mutual assistance provided 
by electric companies, public utilities, and electric 
cooperatives across the country played an important role in 
restoring power so quickly in Florida. Could you discuss the 
logistics of bringing in as many as 60,000 workers from across 
the country to quickly assess and restore, or assess 
restoration locations, and how this effort is being coordinated 
by industry?
    Ms. Hoffman. So, thank you very much for the question. And 
I think it is an impressive network, and the aggressive posture 
that the utility industry has had, as well as the lessons 
learned from Katrina and past events, that the utilities have 
really taken it upon themselves to have a leadership position 
in developing a mutual assistance network. This is a network 
where utilities talk among each other, request mutual 
assistance, and it is organized to provide mutual assistance to 
utilities that request it. And this is across the United 
States. There is different coordination and different entities 
that are responsible for a mutual assistance request in 
different areas of the country.
    The utilities that provide mutual assistance, they talk 
about the management structure; they talk about laydown 
procedures with respect to equipment and equipment necessary. 
And there is a huge coordination with respect to supplies and 
the availability of resources.
    Mr. Long. OK. What role do State or Federal emergency 
operations officials have in monitoring the use of mutual 
assistance and to ensure that it is applied to the most 
critical areas?
    Ms. Hoffman. So, this is real interesting, and I thank you 
for bringing up the point. What we deal with is, first and 
foremost, the utilities are in a leadership position, as they 
should be, for providing response and recovery. The Federal 
agency and the Federal Government and the Department of Energy, 
what we do is help understand when is it outside the ability of 
a utility to be able to manage their response and recovery 
efforts, and what are the resources that are required, the gaps 
that are needed in providing support. So, whether it is 
transportation issues, access issues. And so, that is the 
activities that the Department of Energy and the Federal 
Government help with. And that is whether it is hours of 
service waivers, whether it is weight restriction waivers, 
whether it is understanding if there is a priority, whether it 
is a heavy load like a chemical facility or a pharmaceutical or 
a hospital, what some of those restoration needs are.
    Mr. Long. Speaking of the Federal Government, what does the 
Federal Government do to remove regulatory roadblocks to 
recovery and repair efforts, and are there areas that we can 
improve in those?
    Ms. Hoffman. So, the efforts that the Federal Government 
does and looks at are from a waiver point of view. So, looking 
at access to any sort of damaged area, to making sure that the 
utilities--I guess where I would go with this answer is I will 
be very pointed here. It is that utilities nowadays are very 
much seen as emergency responders. Typically, that has been the 
health and the safety side of things. But now, as you look at 
critical infrastructure and as you look at the needs moving 
forward, telecommunications and electricity are primary for 
providing an effective restoration process and life and safety. 
And so, access for utilities in a damaged infrastructure 
environment, being able to be forward-leaning in getting 
utility resources there, are absolutely critical as we move 
forward. And it is going to be more critical as we look at 
onsite generation and being able to restore power.
    Mr. Long. OK. Thank you.
    And will the Department of Energy be working with the 
States and Territories impacted by these recent hurricanes to 
assess grid resiliency efforts and identify ways to improve 
grid resiliency?
    Ms. Hoffman. Yes.
    Mr. Long. OK. I wish we had time today for an EMP 
discussion with all of you, but perhaps another day. It seems 
like our time is taken up today with talking about the Astros 
all the time.
    Mr. Chairman, I yield back.
    Ms. Hoffman. I look forward to future conversations on 
that.
    Mr. Olson. The conversation is a problem, my friend, about 
the Astros? Is that a big problem?
    The gentleman yields back.
    The Chair now calls upon the gentleman from New York 20, 
including the State capital of Albany, Mr. Tonko, for 5 
minutes.
    Mr. Tonko. Thank you, Mr. Chair.
    While we hear about restoration working along in some of 
our States, many of our fellow Americans in Puerto Rico and the 
United States Virgin Islands remain in the middle of the most 
serious blackout in United States history. Restoring services 
is absolutely critical, but we also need to acknowledge the 
risks of this happening again and the need to support the 
development of a more resilient grid moving forward.
    Over the last decade, extreme weather and fire events have 
cost the Federal Government well over $350 billion, according 
to the Office of Management and Budget. A GAO report last week 
estimated that these costs will likely rise in the future, due 
to the effects of climate change. This is not a choice between 
pay now or pay later. It is a pay now by supporting research, 
hardening infrastructure, and making meaningful investments to 
adapt to and mitigate climate change, or pay now in 
multibillion-dollar emergency spending packages. The fiscally 
sensible approach is to acknowledge the risk posed by extreme 
weather and to make the necessary investments that will 
mitigate it.
    We just passed the 5-year anniversary of Superstorm Sandy 
hitting the Northeast. We have seen a lot of effort in New York 
to build a more resilient grid, but the experience of Sandy 
shows that rebuilding takes time. And it is clear that lessons 
learned from one disaster can make future response and recovery 
more effective. We have been learning from Sandy. We are 
learning from Harvey, from Irma, and from Maria, and the 
learning will continue until we address some of the 
preventative measures.
    So, Ms. Hoffman, your testimony mentioned that Florida 
Power & Light has made major investments since 2006 to build a 
more storm-resilient grid. Similar work has been done in New 
York State in regard to Sandy. How can a smarter, modernized 
grid be more resilient?
    Ms. Hoffman. So, thank you, Congressman, for the question.
    A smarter grid allows for advanced communications and 
controls. It allows for rerouting power. It allows for an 
accelerated situational awareness.
    So, let's first talk situational awareness and the ability 
to have smart meters and you are able to have better visibility 
into your system, be able to isolate damage, be able to reroute 
power. And so, having that ability allows you to be forward-
leaning on placement of resources, to have a very effective 
restoration process, well-planned, well-distributed with 
respect to priorities and how a restoration process can be 
done.
    With respect to being able to reroute power, you can really 
look at isolating customers and being able to make sure that 
you can restore most of, a large number of customers quickly, 
as well as prevent damage to additional customers 
unnecessarily.
    Mr. Tonko. Thank you.
    And, Ms. Walker, can you explain how grid modernization 
efforts in Texas, advanced meters, and others, aided in a more 
rapid recovery there?
    Ms. Walker. Yes, sir. Thank you for the question.
    The advanced meter systems that we have--we have them 
through most of the ERCOT region--were very helpful. It 
notified the utilities of when those customers were out. So, 
they knew where those customers were located. It also helped, 
as Ms. Hoffman said, in rerouting and knowing where they needed 
to send their crews, and being able to reroute electricity to 
serve people in a more timely fashion. So, we found that it was 
very helpful to have the advanced meter systems and the new 
technologies.
    Mr. Tonko. Thank you.
     And DOE's quadrennial energy review heavily focused on 
critical infrastructure interdependencies. I am particularly 
concerned by the harrowing statistics of Puerto Ricans without 
access to safe drinking water. Water, telecommunications, 
hospital, and public safety infrastructure are dependent on 
electricity.
    So, Ms. Hoffman, is a more resilient grid system, perhaps 
one that includes microgrids, distributed generation, and 
storage, important for supporting rapid response and recovery 
in regard to and in interaction with these other critical 
infrastructure needs?
    Ms. Hoffman. So, thank you, Congressman.
    Using a microgrid in a smart fashion around critical 
infrastructure is absolutely important. As you look at 
telecommunications, as you look at water and wastewater 
treatment plants, it is really how do we harden those areas to 
allow for them to either sustain or be able to recover quickly. 
And having generation closer to these critical loads, through 
the form of a microgrid, is absolutely important. I know that 
ConEd and areas in New York are also looking at how do they 
harden their infrastructure.
    And I do want to say I appreciate NIPA and their efforts in 
going down to Puerto Rico as well and supporting the recovery 
efforts.
    Mr. Tonko. Thank you.
    Has there been any interaction with EPA and DOE in regard 
to this interdependency on infrastructure?
    Ms. Hoffman. Sorry, you said EPA?
    Mr. Tonko. Yes. Any efforts with drinking water, DOE, and 
the infrastructure, the electric utility?
    Ms. Hoffman. Thank you very much. I understand.
    Through the Electric Sector Coordinating Council and 
through our responsibility as a sector-specific agency, we have 
had coordination discussions with the telecommunication sectors 
and some of the other critical infrastructure sectors to think 
about how do we really move forward from a restoration process, 
from a hardening process, from an advanced technology process, 
from a coordination process, and moving forward and 
strengthening our economy.
    Mr. Tonko. Thank you so much.
    Mr. Chair, I yield back. And congratulations.
    Mr. Olson. Thank you. The gentleman's time has expired.
    The Chair now calls upon the gentleman from Florida, Mr. 
Bilirakis, for 5 minutes.
    Mr. Bilirakis. Thank you, Mr. Chairman. Thanks for allowing 
me to sit on the committee.
    And then, also, I want to congratulate you on the Astros' 
victory. They are a model. They really accomplished quite a bit 
this year, and I like the way they rebuilt their team.
    So, anyway, can I have an extra 2 minutes because of that?
    Mr. Olson. As long as you want to talk like that, you can 
have 10 minutes.
    [Laughter.]
    Mr. Bilirakis. All right, but I am going to root for 
another team next year. You know that.
    But, in any case, I wanted to talk about--Ms. Walker, if I 
can ask you a couple of questions? I understand that there is a 
site prioritization when utilities are being restored and in 
the midst of a response resources are often spread thin. If 
there are two hospitals--this is a question--if there are two 
hospitals in a given area, how do utilities determine which 
facility is responded to first?
    Ms. Walker. Well, in Texas the hospitals by statute are 
required to have backup generation. So, they do have that 
requirement. I am not sure how they are decided which one they 
respond to first. I know that for CenterPoint Energy during 
Hurricane Ike that that was the first areas that the company 
went to, was to the hospitals. So that all of the personnel 
were trying to restore service to those. So, I am not for sure 
and I would have to look into how they would decide between 
two.
    Mr. Bilirakis. Thank you.
    What role do utility companies play in crafting a State's 
disaster response plan and determining which sites are 
prioritized?
    Ms. Walker. They have complete power to come up with their 
plan on how to restore power. The Commission does have levels 
that we ask them to look at, which are the critical structures 
such as hospitals. By statute, they also have to respond to 
nursing homes. We clearly have them respond to refineries and 
things in the ship channel. So, there is a tier, but the 
utilities are responsible for setting their own priorities.
    Mr. Bilirakis. Thank you.
    How much flexibility does a utility company have in 
determining which sites are restored first?
    Ms. Walker. They have a lot in Texas. They do work, and 
Texas recovery is at the local level, so they do work also with 
their counties and their cities to make those determinations. 
But the utilities in Texas have a significant amount of 
determination on how they restore power.
    Mr. Bilirakis. Thank you.
    The next question to the panel, what challenges still exist 
for Florida and what are your post-storm recommendations? What 
DOE resources are available to the communities like mine 
impacted by Irma? Who would like to being first?
    Ms. Hoffman. I will start. Florida had a very effective 
restoration process. They had the arrangements from a mutual 
assistance point of view. They looked at, and their investments 
in the infrastructure have helped with, hardening their 
systems. Their advanced control and metering has advanced their 
capabilities. At this stage in the game, Florida really looked 
at their codes and standards from a perspective of a Category 3 
hurricane. As we are looking at Category 4 hurricanes and 
additional hurricanes, I think now it comes down to, what are 
some of the additional new capabilities to mitigate a Category 
4 and higher-level hurricanes that they are going to have to 
consider?
    I think from a fuel distribution point of view, that was 
the one area of looking at distributing fuel. Gasoline was a 
challenge in Florida, but I think it was also partly that the 
necessary evacuation that occurred had a run-on on gasoline 
stations. And so, it looks at, they did advance by having 
generation hookup. So, from an electrical point of view, they 
advanced capabilities there. But if I had one area, it is 
probably look at the distribution network with respect to 
gasoline.
    Mr. Bilirakis. The fuel issue, yes, definitely. We were 
very fortunate in the Tampa Bay area, I think as you know, to 
dodge the Category 3 or 4, but God forbid we have one.
    So, anyone else want to comment? I don't have much time. I 
know I asked for an additional couple, but I was just kidding. 
But does anyone else want to comment on that? Any suggestions?
    [No response.]
    That is great input. I really appreciate that.
    Thank you very much, Mr. Chairman. I yield back.
    Mr. Olson. The gentleman is always welcome here. He yields 
back.
    The Chair now calls upon the man who is working very hard 
for a bipartisan agreement to allow me to wear this jersey on 
the House floor later today, Gene Green from Houston, Texas, 5 
minutes.
    [Laughter.]
    Mr. Green. I thank my colleague and neighbor for yielding 
to me.
    For our colleague from Florida, I know there were some 
problems with gasoline supplies there, and maybe you can tell 
me, does Florida import all your gasoline and diesel? I didn't 
know if you had any refineries in Florida. OK. Well, that is OK 
because we want to keep selling you the stuff we produce in 
Texas and Louisiana.
    But, anyway, being a native Houstonian and going through 
lots of storms and hurricanes over the years, Harvey was 
probably the toughest, even compared to Hurricane Carla who hit 
us in 1960, 1961. But every 8 years we have a tropical storm or 
a hurricane. In 2008, we had Hurricane Ike, which damaged our 
infrastructure because it was a wind storm, the storm surge, 
but the wind. By the time Harvey got to Harris County, it was 
mostly rain. And our biggest problem was typically so much rain 
that it overflowed a lot of our sanitary sewer systems in the 
west side of Houston, and even Houston facilities and our 
smaller cities and how that did.
    But, somewhere along the way when we have these thousand-
year storms that are happening so often, and the average 
rainfall in Houston is 49 inches a year and you get 52 inches 
in five days, I don't know how we can deal with it. We just 
have to dig more reservoirs, spend more money to contain that 
water, because water is a precious commodity and we need to do 
it, instead of letting it go into the Gulf of Mexico.
    This is the first storm that I have had where I have had 
fatalities in our district. We lost eight people in our 
district. Two of them were breadwinners in their family, 
because they thought they could go through this high water in 
an underpass.
    But the sad one was that we lost a family of six in our 
district on Greens Bayou, northeast Houston. The bayou, we have 
been working on it for decades to build detention ponds 
upstream, but the family turned off into the bayou, literally, 
because they thought it was the road. And it was widely 
publicized the family was missing, but we didn't find them 
until after the water went down down in Greens Bayou, northeast 
Harris County.
    But, as far as for the utilities, we didn't have that big a 
problem. But, as we are sitting here, we will get another 
hurricane or a tropical storm. And so, that is what I am 
concerned about.
    It is important we try to learn from these lessons of these 
storms. We are in the middle now of building back houses, 
shops, and communities, but we know we have to do better on the 
flood infrastructure, both working with the Corps of Engineers 
and in Harris County. We have a Harris County Flood Control 
District. We tax ourselves to keep from flooding in Harris 
County, so we can partner with the Corps. But it is essential 
that we fund the Corps of Engineers, FEMA, and other related 
agencies in our next supplemental.
    I am concerned about Puerto Rico because their electric 
grid was in pretty bad shape even before. And some of us were 
talking on the Energy Subcommittee a week ago about this may 
give us the opportunity for the United States to actually 
provide an electric system in Puerto Rico, because I understand 
they are still burning fuel oil.
    Again, coming from Texas, we can put all the windmills up 
and all the solar, which you can't get wind and solar. We would 
be glad to have an LNG export/import facility there, because, 
one, it would be much cleaner than fuel oil. It would probably 
be cheaper, too, because the price of natural gas is relatively 
cheap.
    I would just like to ask--like I said, I have driven around 
Puerto Rico, but I don't live there and I don't represent it, 
but I know they need help in getting literally the whole grid 
back up. Is that something that we could look at through the 
Department of Energy to see if we could redo the grid in Puerto 
Rico to where it would be brought up to what we would consider 
standards?
    Ms. Hoffman. I think it is an opportunity to look at all 
technologies and different solutions for investment in Puerto 
Rico, and looking at how we can harden the system. But 
everything should be on the table of what advancements can be 
done with respect to their energy infrastructure. Forty-seven 
percent of Puerto Rico electricity comes from petroleum, 34 
percent from natural gas, 17 percent from coal, and 2 percent 
of renewable energy. And so, there is a lot of opportunities to 
think about the generation mix as well as the location of 
generation, and the use of the transmission and distribution 
system, as well as demand/response and customer engagement.
    Mr. Green. Yes. Well, I know in Texas we have had success 
with the wind power, not only in west Texas, but south Texas, 
and it gives us that type of opportunity to have a different 
fuel supply, although it is hard today to heat with low-price 
natural gas. That is why some of our coal plants are problems.
    Ms. Walker, in your testimony you said that the PUCT's 
initial assessment of the Texas utilities is that they did an 
outstanding job of responding to the storm. And I know over the 
years we have had partnerships with other States and other 
communities, that we will send our utility workers up there 
when they have a problem. When there are ice storms in Dallas, 
we will take care of that. But I don't remember seeing that 
much in the Houston or southeast Texas area.
    Ms. Walker. Mutual assistance?
    Mr. Green. Yes.
    Ms. Walker. There probably wasn't that much because the 
damage was very different and the cause of the outages was very 
different. Usually, the mutual assistance comes in to repair 
wind damage, the poles going own, the wires going down. Houston 
and Beaumont was flooding. And so, most of that was due to the 
substations being out. And so, once we were able to get these 
mobile substations in or the waters recede and get those 
substations back up and running, we were able to restore the 
customers.
    The outages in those areas really weren't very long-
lasting. They were more like a thunderstorm. And Houston and 
CenterPoint Energy and Entergy were continually restoring 
customers. And so, their numbers were very low on an ongoing 
basis, although they ultimately restored a lot of people.
    Mr. Green. And that is why it worries me, because here in 
Puerto Rico I think they are still only about 30 percent of the 
power that has been restored. So, it is really a case that we 
need to work on.
    So, thank you, Mr. Chairman. I yield back.
    Mr. Olson. The gentleman's time has expired.
    Seeing no members seeking to ask questions, the Chair wants 
to thank our five witnesses. Thank you, thank you, thank you 
for coming here today.
    I remind our witnesses that every member can submit 
questions for the record for 10 days. Once you get that, you 
have 10 days to respond.
    Mr. Rush. Mr. Chairman, I request, I would like to make a 
statement.
    Mr. Olson. Yes, sir, you have a minute, Bobby.
    Mr. Rush. A minute? Thank you, Mr. Chairman.
    Mr. Chairman, I must say, with all due respect, as we 
conclude this panel and are getting ready and prepare to 
introduce the next panel, with all due respect, Mr. Chairman, I 
simply smell a rat here. I really smell a rat.
    PREPA's lack of response to this subcommittee's efforts to 
invite them to attend and provide witness testimony to this 
subcommittee is most disgusting and extremely disrespectful. 
Mr. Chairman, that said, I strongly request that we use our 
subpoena authority to demand that PREPA come to this 
subcommittee and disclose to Members of Congress who are 
members of the subcommittee what were the facts involved in its 
awarding this $300 million contract, which I call the sweetest 
of sweetheart deals, to repair and reconstruct Puerto Rico's 
electrical infrastructure.
    And I also believe, Mr. Chairman, that as has been stated 
by Members of both sides during this panel, that FEMA should 
also be invited to be at the same witness table. Mr. Chairman, 
we ought to get to the bottom of this, and we have got to know 
what happened, when did it happen, and who is responsible for 
this absurd sweetheart deal that is going to result in numerous 
people paying an extraordinary additional amount of millions of 
dollars because of the delay in the withdrawal of this 
contract.
    So, I really request that we use our subpoena authority to 
make sure that PREPA stop disrespecting the United States 
Congress.
    Thank you. I yield back.
    Mr. Olson. And, my friend, I share your concerns. It sounds 
kind of odd, what happened there, but I will talk to the chair 
for the subcommittee, Mr. Upton, and the full committee, Mr. 
Walden, about the subpoena issue.
    But, right now, a point of personal privilege before the 
first panel leaves, and this is maybe at the risk of offending 
Ms. Castor. But, Commissioner Walker, I hope you are going to 
SMU Saturday, joining my daughter and my wife to watch SMU beat 
the tar out of Central Florida.
    [Laughter.]
    The panel is dismissed.
    OK. Second panel, are you all ready? And just like before, 
we will start out with opening statements from all of the 
panelists, followed by questions from members.
    And I recognize Thomas Fanning. Tom is the President and 
CEO of Southern Company. He is here on behalf of the 
Electricity Subsector Coordinating Council.
    Tom, you have 5 minutes for an opening statement.

STATEMENTS OF THOMAS A. FANNING, PRESIDENT AND CHIEF EXECUTIVE 
    OFFICER, SOUTHERN COMPANY, ON BEHALF OF THE ELECTRICITY 
SUBSECTOR COORDINATING COUNCIL; JULIO A. RHYMER, SR., EXECUTIVE 
 DIRECTOR AND CHIEF EXECUTIVE OFFICER, VIRGIN ISLANDS WATER & 
 POWER AUTHORITY; CHET THOMPSON, PRESIDENT AND CHIEF EXECUTIVE 
 OFFICER, AMERICAN FUEL & PETROCHEMICAL MANUFACTURERS; MAX E. 
    MCBRAYER, JR., CHIEF SUPPLY OFFICER AND CHIEF FINANCIAL 
 OFFICER, RACETRAC PETROLEUM, INC., ON BEHALF OF THE NATIONAL 
     ASSOCIATION OF CONVENIENCE STORES AND THE SOCIETY OF 
 INDEPENDENT GASOLINE MARKETERS OF AMERICA; RAMON-LUIS NIEVES, 
  ATTORNEY AT LAW, FORMER MEMBER, SENATE OF PUERTO RICO; AND 
  CATHERINE B. KENNEDY, VICE PRESIDENT, NATIONAL NURSES UNITED

                 STATEMENT OF THOMAS A. FANNING

    Mr. Fanning. Thank you. Thank you for inviting me to 
testify today.
    My name is Tom Fanning. I am the chairman, president, and 
CEO of Southern Company. I am also the immediate past chairman 
of the Edison Electric Institute, the association that 
represents all U.S. investor-owned electric companies. However, 
I am addressing you today in my role as one of three co-chairs 
of the Electricity Subsector Coordinating Council. We 
collaborate closely with our colleagues from public power 
utilities and rural electric cooperatives on the ESCC.
    I am pleased to address the subcommittee and to share the 
steps the electric power industry is taking to make energy 
infrastructure smarter and more resilient, allowing us to 
continue delivering affordable and reliable power.
    The 2017 hurricane season highlights the critical 
importance of cooperation and coordination among electric 
utility companies, the Government, and other key infrastructure 
industries to ensure fast, efficient recovery for customers.
    The electric sector faces constantly-evolving threats to 
the energy grid. The industry's risk mitigation strategy 
emphasizes a defense-in-depth approach. We focus on 
preparation, prevention, response, and recovery, with an 
emphasis on the isolation of and enhanced protections for 
critical assets.
    While this hearing is focused on storm response and 
recovery, it is important to note that our companies do not 
build the energy grid or our security responses to meet only 
one type of threat. We must prepare and plan for them all, 
whether manmade or natural, malicious or unintentional, 
relating to the cyber or physical security, or a combination of 
threats.
    Weather is an unavoidable part of our business. In the 
aftermath of such events, the industry works to identify gaps, 
compile lessons learned, and disseminate best practices. As an 
industry, we strive to be better today than we were yesterday 
and to be better tomorrow than we are today.
    Since Superstorm Sandy 5 years ago this week, the electric 
power industry has combined efforts across all segments of the 
industry and has worked with the Government partners to 
streamline restoration efforts and to improve preparation for 
and response to major threats that cause significant outages.
    The benefits of this coordination were visible over the 
past several months as the industry and Federal Government 
worked to prepare for and respond to the hurricanes. There is 
an understandable urge to compare storms, but the reality is 
that each storm is different. The common threads, however, are 
the need for resilient infrastructure, a plan for response and 
recovery, and the awesome nature of our industry's ability to 
respond to emergencies.
    Before I close, I would like to underscore the importance 
of the ESCC. During the most recent storms, the ESCC held daily 
coordination calls among impacted companies and Government 
officials to address critical operational issues such as 
identifying specialized equipment needs, removing temporary 
flight restrictions for both manned and unmanned aircraft to 
assist with aerial damage assessments, coordinating how 
industry could re-enter and access disaster areas, and 
coordinating response efforts with the oil and natural gas, 
telecommunications, transportation, and water and wastewater 
sectors.
    Energy Secretary Rick Perry was on every call and was 
frequently joined by other officials such as Homeland Security 
Acting Secretary Elaine Duke. These calls were essential to 
identify and address critical issues in the response and 
recovery efforts.
    The reliability and resiliency of the energy grid are of 
paramount importance. Our customers expect the lights to go on 
when they flip a switch. When the power goes out, our customers 
expect that it will be on soon.
    The electric power sector will continue to strive to meet 
those expectations through a multilayered strategy, to invest 
in smart energy infrastructure, continuous enhancement of our 
industry/Government partnership, and the grit of the amazing 
men and women who make the energy grid work day-in and day-out.
    The subcommittee is showing great leadership with its focus 
on preparedness, and we look forward to working with you on 
this critical topic.
    Thank you again for the opportunity to testify on behalf of 
the ESCC, and I look forward to your questions.
    [The prepared statement of Mr. Fanning follows:]
    
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    Mr. Olson. Thank you, Mr. Fanning.
    And now, the Chair is glad to call upon Mr. Julio Rhymer, 
the Executive Director of the Virgin Islands Water & Power 
Authority, that suffered devastation from two hurricanes, Irma 
and Maria. A 5-minute opening statement, Mr. Rhymer. Thank you.

               STATEMENT OF JULIO A. RHYMER, SR.

    Mr. Rhymer. Good evening, Mr. Chair, other honorable 
members of the Subcommittee on Energy.
    My name is Julio A. Rhymer, Sr. I am an Executive Director 
and Chief Executive Officer of the Virgin Islands Water & Power 
Authority.
    On behalf of the Governor of the Virgin Islands, the 
honorable Kenneth E. Mapp; the Virgin Island Delegate to 
Congress, Honorable Stacy Plaskett; the members of the 32nd 
Legislature of the Virgin Islands, and the Governing Board of 
WAPA, I thank you for the invitation to provide testimony on 
the energy challenges facing the U.S. Virgin Islands as a 
result of the passage of Hurricanes Irma and Maria.
    As you all are aware, in September of 2017, the Virgin 
Islands faced the phenomenon of two back-to-back Category 5 
hurricanes within two weeks. According to the Saffir-Simpson 
Wind Scale, a Category 5 hurricane has sustained winds of 
greater than 157 miles per hour. There were cases in Hurricane 
Irma that winds were sustained at above 190 miles an hour.
    WAPA's transmission and distribution facilities were, plain 
and simple, destroyed by the catastrophic winds of two 
hurricanes. Due to Hurricane Irma's impact on September 6th, 
2017, the St. Thomas, St. John, Water Island, and Hassel Island 
electrical transmission distribution system suffered 
significant damage. The St. Thomas system sustained damages of 
approximately 80 percent; St. John, approximately 90 percent; 
Water Island, 90 percent, and Hassel Island, 90 percent.
    Approximately two weeks later, on Tuesday, September 19th, 
2017, Hurricane Maria caused damage to almost 60 percent of the 
transmission and distribution system on St. Croix. The islands 
of St. Thomas, St. John, Water Island, and Hassel Island did 
not receive any significant damage from a result of Hurricane 
Maria.
    To date, the Authority has approximately 536 linemen and 
other related off-island personnel in the Territory, restoring 
WAPA's electrical infrastructure. With the assistance of FEMA, 
naval vessels and cruise ships have been brought in to provide 
sleeping quarters for the off-island crews, since many hotels 
and guesthouses throughout the Territory remain closed after 
sustaining major damages during these two hurricanes.
    By far, the biggest challenge that I would like to focus on 
today is funding the day-to-day operations and hardening of the 
system in the event of future storms. Without question, these 
hurricanes have decimated WAPA's finances. While we appreciate 
the assistance that has been, and will be, forthcoming to 
rebuild the systems that were damaged, one of our primary 
concerns as the Authority is the ability to meet prestorm 
expenses. Prior to hurricanes, the Authority's revenues were 
approximately $25.6 million per month. Since the hurricanes 
events, and since we are unable to provide electrical service 
and bill customers, revenues have dropped below $2 million per 
month.
    WAPA has reoccurring expenses such as payroll, insurance, 
plant operation and maintenance, debt service, and previously-
executed contracts, and financing agreements it must pay. To 
address this dramatic shortfall, the Authority has sought, 
through the government of the Virgin Islands, a community 
disaster loan. Any support or assistance that you can offer in 
this regard is appreciated.
    One of the evident takeaways from the two Category 5 
hurricanes, and significant damages to this regional system 
Territorywide, is that there is an urgent need for WAPA to 
rebuild its transmission and distribution systems, but to 
harden it to a point where it is resilient to wind storms. WAPA 
believes it would significantly reduce its post-storm hurricane 
period by undergoing more of its critical infrastructure and by 
moving away from wooden poles and introducing composite poles 
on the major distribution circuits.
    WAPA must also address its grid, since it is too 
susceptible to damage from wind storms. WAPA had a proposed 
plan to construct a series of microgrids on each island. Each 
microgrid would be a localized group of electrical facilities 
that would either work in tandem with the generating facilities 
or an option for disconnection where they can stand alone. In 
the event the power and the main grid is interrupted for any 
reason, the microgrid would function as a small facility 
generating its own power at this point.
    Currently, you have in the works a microgrid on the island 
of St. Croix that is actually going to go out for bid, and that 
will provide, basically, power through solar and battery 
storage to our airport facilities, a waste treatment facility, 
a correctional facility, and, basically, a police station at 
this point. What we are actually attempting to do here, as a 
utility moving forward, is to harden our system, No. 1, and, 
basically, make it more resilient by having microgrids.
    I would like to thank you for the opportunity to appear 
before the Subcommittee on Energy. I am available to answer any 
question that you may have on this matter.
    [The prepared statement of Mr. Rhymer follows:]
    
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    Mr. Olson. Thank you, Mr. Rhymer. And I heard what Irma 
didn't destroy, Maria drowned.
    Mr. Rhymer. Yes, it did.
    Mr. Olson. The Chair now calls upon Mr. Chet Thompson. Chet 
is the President and CEO of the American Fuels & Petrochemical 
Manufacturers.
    Mr. Thompson, you have 5 minutes for an opening statement.

                   STATEMENT OF CHET THOMPSON

    Mr. Thompson. Thank you, Mr. Vice Chairman, Ranking Member 
Rush, and members of the subcommittee. Thank you for having me 
here today.
    My name is Chet Thompson. I am the President and CEO of the 
American Fuel & Petrochemical Manufacturers. AFPM represents 
the refining and petrochemical industries. Our members 
represent 120 refineries, 140 petrochemical facilities. That 
represents 98 percent of U.S. production capacity. More than 
half of that capacity is located along the Gulf Coast.
    Hurricane Harvey impacted our facilities in the fuel supply 
chain very hard. Hurricane Irma impacted the fuel supply chain, 
but largely in Florida, while Nate's impact on our assets was 
rather minimal.
    But, more importantly, the combination of Hurricanes 
Harvey, Irma, and Maria were devastating to the people of the 
Gulf Coast, particularly those in Houston and the Beaumont 
area, Florida, and Puerto Rico. Many of those impacted are part 
of our extended oil and gas family. Our hearts and prayers 
continue to go out to those still struggling to recovery, and 
we stand by them and will help them any way we can.
    As a result of this personal impact on us, the subject of 
today's hearing is particularly important to our industry. So, 
I would like to limit my time this afternoon only to three key 
points of my written testimony.
    First, by and large, the U.S. refining and petrochemical 
industries weathered the storm fairly well and proved to be 
very resilient. This did not happen by accident. Rather, it was 
the result of lots of hard work and preparation, and with the 
help of an incredibly dedicated workforce and Federal, State, 
and local first responders. They are the true heroes coming out 
of these events.
    If you wanted to draw the storm up that could wreak the 
most havoc on our industry, Harvey was it. Harvey hit Corpus 
Christi as a Category 4 storm, moved right up the east coast, 
stalled largely over Houston, which is the epicenter of the 
refining and petrochemical industries. It dumped over 60 inches 
of rain in some locations and more than a trillion gallons of 
water across Texas and Louisiana.
    At its peak, Harvey knocked 24 of our refineries offline. 
That represents 25 percent of all U.S. refining capacity. It 
had a similar impact on our petrochemical members. It knocked 
60 percent of U.S. petrochemical capacity down. That is 80 
percent of the capacity found in the Gulf Region.
    Harvey also had a significant impact on the entire fuel 
supply chain. It shut down ports, pipelines, terminals, rail, 
and certainly gasoline stations. Our facilities couldn't get 
feed into their plants, and we certainly couldn't get products 
out.
    This had the potential to be catastrophic for the fuels and 
petrochemical supply chains, but in the end it wasn't. Just two 
weeks after Harvey made landfall, 20 of the 24 facilities that 
went down had restarted. And the petrochemical facilities made 
substantial progress during this period as well.
    Again, this was not by accident. Facilities were prepared 
for the storms. They had applied many of the lessons learned in 
the aftermaths of previous storms like Katrina and Rita. For 
example, our facilities developed more sophisticated 
preparedness plans, improved storm monitoring, hardened 
critical infrastructure, elevated pumps and generators, 
procured spare parts so we could be ready to move with recovery 
efforts after the storm. We upgraded our IT systems to help us 
locate employees and ensure that they had the assistance they 
needed. All of this made a difference. We came back online much 
faster than we did after prior storms.
    The second point I would like to make, the Federal and 
State response was significantly improved compared to previous 
storms. One of the lessons we have learned is that we have to 
better coordinate Federal, State, and local governments. So, 
over the last few years, we have been working hard in that 
regard, working closely with DOE and DHS to improve our 
relationships.
    The results during Harvey, in particular, were excellent. 
We were in constant contact before, during, and after the 
storms. The improved coordination was most evident in the quick 
review and approval of fuel waivers, unlike in prior storms, 
helping us get fuel to where it was needed quickly and 
efficiently. Our Federal and State partners, particularly 
Secretary Perry, Administrator Pruitt, Governors Abbott and 
Scott, deserve kudos for these improvements.
    If I had to identify the one area that could be improved, 
it would be better communication by our Government to consumers 
about the fuel supply chain and the challenges that often 
accompany events like hurricanes. For example, the Government 
could help us explain the timelines for bringing facilities 
back online and getting products back to the distributors and 
the marketers. And it could also help us discourage panic 
buying that always seems to accompany these types of events.
    Third and finally, as always, our companies will work with 
Federal and State authorities to identify and apply lessons 
learned. Although we did fare fairly well, no doubt there are 
going to be things we can learn and improve upon to make future 
responses even better. We would caution anyone to resort to any 
knee-jerk reactions or conclusions, particularly those based on 
a few isolated events, before full assessments are in.
    So, I know I am running out of time. I thank everyone for 
my time and the opportunity to speak today.
    And again, I would like to express our thanks and 
appreciation for our incredible workforce and our first 
responders. They certainly deserve our appreciation.
    So, thank you, and I am happy to answer any questions.
    [The prepared statement of Mr. Thompson follows:]
    
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    Mr. Olson. Thank you, Mr. Thompson.
    The Chair now calls upon Mr. Max McBrayer. Max is the Chief 
Supply Officer for RaceTrac Petroleum, Incorporated.
    You have 5 minutes, sir.

               STATEMENT OF MAX E. MCBRAYER, JR.

    Mr. McBrayer. Thank you. Mr. Vice Chairman, Mr. Ranking 
Member, and members of the subcommittee, thank you for the 
opportunity to testify today on the retail community's response 
efforts to 2017 hurricane season.
    My name is Max McBrayer. I am the Chief Supply Officer and 
the Chief Financial Officer of RaceTrac Petroleum, Inc. I am 
testifying today on behalf of the National Association of 
Convenience Stores and the Society of Independent Gasoline 
Marketers of America. RaceTrac is a family-owned business, 
headquartered in Atlanta, Georgia, operating more than 450 
convenience stores across 12 States and employing nearly 9,000 
team members.
    The 2017 hurricane season had a devastating effect on 
America's fuels infrastructure and markets. During Hurricane 
Harvey, flooding damaged more than a quarter of the U.S. 
refining capacity and shut down fuel pipelines. This put severe 
strain on the domestic fuel supply. Hurricane Irma led to an 
increased demand for fuel in Florida, further straining the 
fuels market and causing prices to rise sharply.
    Natural disasters directly and severely affect the retail 
fuels market. Margin on fuel sales range between 2 and 20 
cents, and retailers must constantly react to changes in supply 
and demand to ensure their prices remain competitive.
    During any severe weather event, wholesale fuel prices 
become more volatile as the market tries to assess and 
anticipate supply availability. When these unwelcome changes 
occur, retailers respond to meet their cost.
    Due to the infrastructure damage, compliant fuel 
inventories became strained, leading to escalating wholesale 
prices. Retail market prices generally reflect rapid increase 
in the wholesale prices. In this instance, fuel retailers made 
individual decisions on whether to increase prices and risk 
losing customers or potentially take losses by keeping prices 
low and not covering the increased wholesale cost.
    Despite the tough situations, the fuel market was supported 
by the actions of both the Federal Government and the State 
governments. The governments worked with us to deal with the 
issues before, during, and after the hurricanes.
    Communication and coordination initiatives were 
particularly important. For example, the Governors of Texas and 
Florida held conference calls with industry and Government 
stakeholders where they listened to concerns and rendered 
prompt assistance.
    In Florida specifically, the Governor's office waived 
certain restrictions for highways, helped ensure that ports 
prioritized fuel shipments, coordinated escorts for fuel trucks 
and ships, easing the movement of product to the retail fuel 
locations.
    At the Federal level, disaster response efforts spanned a 
number of agencies, which ultimately issued more than 30 
waivers to help deal with fuel supply issues. Of particular 
importance to RaceTrac was the waiving of hours-of-service 
limitations for drivers providing assistance to affected areas. 
These waivers were the difference between getting fuel to our 
customers in a reasonably affordable and timely manner and not 
being able to supply customers with the fuel they needed.
    In response to State petitions, Federal agencies also eased 
restrictions on the type of product that retailers could sell. 
For example, EPA temporarily waived certain reformulated 
gasoline requirements under the Clean Air Act.
    Despite the major disruptions to the fuel distribution 
system after the hurricanes, the impact on consumers and the 
economy was still less than what occurred with Hurricanes 
Katrina and Rita in 2005. This is because the Government worked 
with the private sector to respond appropriately.
    There are still important lessons to be learned, however. 
For instance, there is no good coordinated effort to make sure 
that consumers were informed of the status of fuel supplies via 
social media. As the hurricanes approached, we believe that 
much of the panic about fuel availability caused a significant 
and totally unnecessary pull on the available fuel supply. The 
panic lessened when information on the fuel supply was shared 
with the public. In addition, bottlenecking at ports and fuel 
terminals was a problem that the Government could have done 
more to alleviate.
    Finally, in the hurricanes' aftermath, truck drivers and 
other employees found it difficult to get to affected areas 
quickly. Anything that can be done to remove hurdles for fuel 
transportation would speed up recovery efforts in the wake of 
future hurricanes.
    RaceTrac believes the collaboration between the public and 
the private sectors was critical to the successful response 
efforts. We are proud to have been able to serve the 
communities that we operate in.
    And I thank you for the opportunity to provide this 
testimony.
    [The prepared statement of Mr. McBrayer follows:]
    
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    Mr. Olson. Thank you, Mr. McBrayer.
    The Chair now calls upon the honorable Ramon Luis Nieves, 
who is now an attorney at law, was a former distinguished 
member of the Senate of Puerto Rico.
    You have 5 minutes for an opening statement, sir.

                 STATEMENT OF RAMON-LUIS NIEVES

    Mr. Nieves. Thank you, Chairman Olson, Ranking Member Bobby 
Rush, members of the subcommittee.
    My name is Ramon-Luis Nieves. I had the privilege to serve 
the people of Puerto Rico as senator of San Juan and chairman 
of the Committee on Energy. I currently practice law in the 
State and Federal courts of Puerto Rico.
    I want to thank the subcommittee for this opportunity to 
discuss Puerto Rico's energy challenges. As a resident of San 
Juan, I have personally suffered the problems associated with 
the lack of electricity for more than 40 days. The currently 
energy crisis is destroying our economy and our way of life.
    Nobody denies the challenges of repairing the collapsed 
energy grid of Puerto Rico, but I submit to you that most of 
the challenges to turn the lights back on in Puerto Rico are 
neither natural nor geographic. They are manmade.
    The Puerto Rico Electric Power Authority, PREPA, was 
already a bankrupt, fragile, and useless entity before 
Hurricane Maria made landfall. The Power Authority's grid was 
obsolete, lacking adequate maintenance.
    The recent Whitefish debacle is exhibit A of the governance 
issues plaguing PREPA. As we evaluate energy options for Puerto 
Rico, we must be particularly alert about disaster contractors 
who may try to take advantage and profit off of our people's 
misery.
    But I didn't take two flights from San Juan to complain 
about PREPA. I come before you with proposals to help us 
transform Puerto Rico's energy model.
    Energy equals life. As most Puerto Ricans sadly understood 
after Hurricane Maria, the lack of a strong, resilient, and 
smart energy system has the potential of killing people and 
destroying the economy. The actual death toll not of Hurricane 
Maria, but of Hurricane PREPA has not been properly disclosed 
by the government of Puerto Rico.
    While working hard to turn the lights back on as soon as 
possible, policymakers must also think long term. A plan to 
transform Puerto Rico's energy model, supported by significant 
Federal support funding, is the right course of action.
    Technology and innovation are transforming the energy 
industry. Puerto Rico must break free from PREPA's centralized 
energy model. The people of Puerto Rico deserve an energy model 
whereby more and more customers are able to opt for distributed 
generation or go off the grid in their homes and business.
    Policymakers are agreeing with the idea of a new energy 
model based on several regional microgrids. Microgrids for key 
Government security and health installations, such as 
hospitals, will also help recovery efforts after future storms 
and hurricanes.
    The mandate to regulate microgrids is already in our law 
books. Act No. 133 from last year the last bill that I 
sponsored in the Senate, to include microgrids as a mandate. 
However, a Federal mandate to include microgrids in a new 
energy model for Puerto Rico will certainly help.
    PREPA has also pointed out that the Stafford Act restricts 
to rebuild the grid as it was. Perhaps you may be able to 
change that by amending Federal law.
    PREPA's old, and now collapsed, grid is not able to deal 
with the technical challenges of an energy model that embraces 
renewable power. However, as I have said, countless 
policymakers agree that just repairing the old, obsolete energy 
grid of Puerto Rico will be a colossal waste of taxpayer 
dollars. PREPA is broke. So, the Federal Government is the only 
entity able to finance this key project.
    Let's talk about PREPA's governance. The Whitefish scandal 
is a sad example of the shameful and incompetent governance 
that characterizes PREPA. PREPA awarded a no-bid $300 million 
contract to an unknown company with just two employees. The 
Government recently requested PREPA to cancel the contractual 
agreement, but 40 days after Hurricane Maria, and hundreds of 
deaths later, PREPA did what it should have done from the 
start, request the mutual aid offered by private and public 
electric companies. But where was PREPA's governing board? 
Nobody really knows, but I submit to you that this Whitefish 
business is very harmful to Puerto Rico's credibility.
    Very quickly, since my time is almost up, PREPA collapsed 
under its $9 million debt. Congress, the administration, and 
the oversight board must create a financial solution for 
PREPA's debt. Aggressive restructuring of the debt, combined 
with new Brady-type bonds and continued oversight over PREPA, 
could be a way to solve this monumental problem.
    And just to finish up, the most efficient way to transform 
the energy model of Puerto Rico is by giving the proper 
resources to Puerto Rico's independent energy commission. An 
independent and strong regulator is key for our recovery. In 
order to guarantee the Federal funds to build a new energy grid 
are properly used and allocated, I propose that the 
Revitalization Coordinator of Puerto Rico under PROMESA and the 
Puerto Rico Energy Commission be given sole authority over 
PREPA. PREPA shall cease to exist in its present form.
    Just to wrap up, thank you for the opportunity. The people 
of Puerto Rico urgently need to turn their lights back on, but 
we also demand the resources to create a new energy model for 
our island. Our lives depend on it.
    Thank you.
    [The prepared statement of Mr. Nieves follows:]
    
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    Mr. Olson. Thank you, Senator Luis Nieves.
    We saved the best for last, ma'am. Our final opening 
statement is going to be from Ms. Cathy Kennedy, and she is the 
Vice President of the National Nurses United.
    Ma'am, you have 5 minutes for an opening statement. 
Welcome.

               STATEMENT OF CATHERINE B. KENNEDY

    Ms. Catherine Kennedy. Vice Chairman Olson, Ranking Member 
Rush, and members of the subcommittee, good afternoon, and 
thank you for inviting National Nurses to take part in this 
hearing.
    My name is Catherine Kennedy of Carmichael, California, and 
I have been a registered nurse for 37 years. I currently serve 
as the Vice President of National Nurses United, which is the 
largest union of RNs in the country. I submit the testimony 
today on NNU's behalf.
    From October the 4th through the 18th, I served on a 
voluntary deployment to Puerto Rico with NNU's Registered Nurse 
Response Network to assist with Hurricane Maria's disaster 
relief. Fifty nurses deployed with R&R into Puerto Rico among 
300 skilled union members organized by AFL-CIO.
    NNU nurses very much appreciate your holding this hearing 
and providing us the opportunity to share our account of the 
public health crisis that we witnessed. NNU's full report on 
the conditions of Puerto Rico is attached to my written 
testimony.
    The lack of electricity is endangering people's lives and 
leading to preventable death and illness. I was the lead RN for 
the healthcare teams on the deployment. I helped to organize 
nurses into teams and, with a map of the island, we tracked the 
public health assessment of each community that we visited, 
evaluating whether people had access to food, water, and 
healthcare, their basic living conditions, and medical needs. 
Time and time again, we saw that lack of power exacerbated the 
disaster or created new ones.
    Basic medical services were down in many areas and not 
fully functioning in others. An acute public health crisis has 
developed. Without electricity, people with chronic illnesses, 
such as diabetes and hypertension, cannot refrigerate their 
medications. For example, in Loiza, nurses worked with elderly 
residents who had to put their insulin in bowls of tepid water, 
trying to keep this lifesaving medication cool enough to use.
    Pharmacies could not refrigerate their medications, either. 
They also cannot access computer systems which store 
prescription orders. Therefore, patients were scrambling to 
find doctors to write new prescriptions, so they can give them 
to the pharmacies. But many doctors' offices were closed, 
partly because the grid is still down and accessing reliable 
generators and fuel for them was nearly impossible.
    Pharmacies also cannot access insurance information. So, 
patients are being asked to pay full price for medications. 
Most people don't have cash, and if they had money in the bank, 
they can't access it because the ATMs and the banking process 
systems are also down.
    As long as the power grid is down, hospitals cannot 
function at full capacity. Generators are prone to failure, and 
fuel is hard to access. With generators, hospitals can't 
perform certain procedures or tests which use a large amount of 
energy. And at one hospital we know that they could not perform 
MRIs as long as they relied only on generators.
    Without reliable power, the problems of accessing food and 
water are amplified. The simple act of purchasing food and 
water, when it is available, is nearly impossible. Stores can't 
take credit cards, and ATMs don't work. Bank services that 
normally take minutes now take hours.
    The people of Puerto Rico are unable to refrigerate and 
cook their food. They must rely on canned and processed foods, 
which are high in sodium. Access to food in rural communities 
is especially difficult. As long as there is no power, people 
will be reliant on relief organizations to provide food and 
water for them.
    Electricity is also needed to run wastewater treatment 
plants and to restore the functioning of water utilities. 
Without clean running water, nurses have witnessed the 
beginnings of multiple outbreaks of waterborne diseases, 
including leptospirosis, an animal-borne bacterial disease that 
can be fatal if not treated in time.
    Then, there are problems accessing FEMA aid. People can't 
access FEMA's online notices and aid application. For those 
that are able to apply for aid, they are told that necessary 
followup communication will be sent either by text or email. 
People don't have power right now. They are not going to 
receive any followup for their FEMA applications.
    NNU urges Congress to use its oversight and appropriation 
authority to ensure that FEMA and other U.S. agencies respond 
to this crisis effectively. It is unacceptable that citizens of 
the richest country on earth have been denied necessary 
humanitarian aid and left to die. With a growing climate 
crisis, relief to Puerto Rico must come in the form of 
responsible measures that can build a sustainable energy 
future.
    Thank you again for giving NNU the time to share the 
stories of the people and places in Puerto Rico that we cannot 
and must not forget. Thank you.
    [The prepared statement of Ms. Kennedy follows:]
    
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    Mr. Olson. Thank you, Mrs. Kennedy.
    And now is the fun time, questions from the Members. And 
the Chair will yield to himself for 5 minutes of questions.
    My first questions are for you, Mr. Thompson. First of all, 
I have to say congratulations. I mean, I was there for 
Hurricane Ike, Tropical Storm Allison. I was there for 
Hurricane Harvey. Most of our capacity was in that storm. You 
guys came roaring back. So, congratulations for getting that 
turned around so quickly.
    I have talked to a lot of people. You guys have gotten much 
better preparing for hurricanes or sort of natural disaster. 
Yes, we are going to take a hit; we know it. I have heard like 
with Katrina, Rita, and Ike, you all learned how to not fully 
shut down our refinery, but keep it warm, so to speak, not the 
complete shutdown, but keep it going where it is that risk of 
some sort of breach. But, once the storm clears, get that thing 
up like that.
    So, I just want you to talk about how you prepare a 
refinery that is directly in the path of a storm like Harvey to 
make sure to get that thing back online as quickly as possible.
    Mr. Thompson. Well, thank you for the question, and I 
address some of this in my opening remarks. Most of this, of 
our ability to weather the storms, one was our credible 
workforce. We literally had thousands of people that were 
riding out these facilities. When their own families and houses 
were in peril, they were helping keeping our facilities 
literally above water and ready to go.
    Also, lots of preparation. We have been working on storm 
for years, working with the National Petroleum Council, working 
with DOE and DHS. This was not something that we prepared for 
just a few weeks ago.
    We took all the lessons learned from prior storms and we 
put them in the action. We hardened our infrastructure. We 
elevated what we could elevate. We have much better storm-
tracking capabilities now. So, we could identify exactly where 
the storm was going and identify when we had to bring the 
systems down.
    Safety is the No. 1 responsibility. So, our facilities will 
come down when safety demands it. And so, for those facilities 
where they realized that they weren't going to be hit as hard, 
they could remain warm and ready to go. Some of the facilities, 
indeed, had to come all the way down.
    So, I would just end by saying a lot of hard work, a lot of 
dedication. And again, we can't applaud our employees enough.
    Mr. Olson. And lessons learned, which I know it just goes 
with the territory. You will have some leaks, some chemical 
leaks, you know, whatever. For example, we have these big tanks 
that have floating tops. And the water got so high, almost 5 
feet of rain overcame the capability, and you had some small 
leaks.
    So, my question is, what are you all doing to prevent and 
respond to these spills before they happen? Because I know it 
is amazing what happened. I mean, it was such a stellar 
performance. But how do you make it even better going forward?
    Mr. Thompson. Well, I can assure that every company, those 
impacted and those that even weren't directly impacted are 
assessing how we responded to the storm, what went well, what 
didn't go well. We, as a trade association, bring our members 
together. We share information. And we will work to improve. 
Very storm, we learn from the prior one to get better.
    Mr. Olson. Thank you.
    A question for you, Mr. McBrayer. I mean, I was driving 
around pretty much for a week after Harvey hit and you could 
find gasoline. Some shops were shut down. My question is, was 
that because of power, because of lack of supply, lack of the 
gasoline, or lack of the employees being able to get to work 
because of all the floods? So, what was going on there? 
Because, again, you could find it, but some stations weren't up 
and running and, as you mentioned, there was some price gouging 
because of all sorts of rushes because people are panicking 
that there will be no gasoline.
    Mr. McBrayer. All of the things that you mentioned, Mr. 
Vice Chairman, are correct. Some of it is due to the fact that 
we rely upon the employees who are living in the affected area. 
And like any good employer, we are more concerned about their 
life at home and being sure that they are prepared to meet the 
needs of their family before they return to work.
    We do have some problems with the electrical supply. 
Getting generators into our stores, specifically, was quite 
challenging in the Houston area because of the amount of 
flooding in the roadways. There are some stores that just 
choose not to buy at the costs that tend to go up during these 
disasters.
    But most everyone is working hard because in our business 
we build 50-year assets. We are there for a long time. And so, 
our long-term mentality is to provide what our guests, our 
consumers, need, and to work hard to do that.
    It is a site-by-site issue as to what the problems are and 
what we may need to do. We have stores in the south Houston 
area with some water in tanks. We have had stores that were 
completely flooded out that are still yet to reopen. But you 
have to assess your assets one at a time and do things you can 
quickly in order to bring them back online.
    Mr. Olson. One further question, Mr. Fanning. You brought 
up UAVs, and that is a big deal, hard back home. A town called 
Missouri City had some levies, not so much oil production, but 
levies that may be breaching. They were fine, the UAVs, they 
could see it and, then, they were grounded. So, how about the 
role of UAVs in these disasters for oil and all the operations 
with the petrochemical industry? Because those things are 
working and, for some reason, they were shut down because there 
was some kind of danger. And that was just not right to do 
because of that breach; they may have prevented a breach 
because they saw it with the UAVs. So, any idea about oil and 
gas operations, refining, storage, whatever, that UAVs could 
help out?
    Mr. Fanning. Yes. Well, we don't impact oil and gas 
particularly. But, in response to any storm, there should be a 
comprehensive plan that is undertaken, really driven by the 
local authorities.
    I was listening to your prior panel. Very interesting, in 
that every utility works with--for example, in Georgia, they 
would work not only with the Federal agency FEMA, but with 
GEMA. Within that context, all critical infrastructure is 
evaluated with respect to the approaching threat. And 
therefore, we develop a set of priorities and, essentially, a 
response regime as to how to provide the best benefit going 
forward.
    I can't speak to Missouri or whatever the impact is there, 
but I would assume that they have taken those things into 
account.
    Mr. Olson. Thank you. I am aware of my time.
    The Chair now recognizes the gentleman from Illinois, the 
ranking member, Mr. Rush, for 5 minutes.
    Mr. Rush. I want to thank you, Mr. Chairman.
    Ms. Kennedy, your testimony has been very, very amazing 
testimony. I am amazed at the breadth of the tragedies that are 
occurring, even as we speak, in Puerto Rico. And I amazed at 
the lack of proper attention by those in our Government in 
determining their response to this American tragedy in Puerto 
Rico.
    There are some who are disputing the official death toll. 
Some say that, oh, 51 casualties due to the hurricane. But, 
yet, the Puerto Rican Department of Public Safety confirmed 
that over 900 bodies have been authorized for cremation since 
Hurricane Maria tore through their island on September the 
20th. And that 900 figure includes deaths related to lack of 
oxygen and other fatalities that appear to be due to the power 
outage. Yet, some say that those fatalities should just be 
considered natural deaths.
    Do you concur with this definition from your experiences? 
You have spent time there. Do you believe that the death toll 
from Hurricane Maria is actually 51 or is it closer to 900, or 
is it somewhere in between?
    Ms. Catherine Kennedy. Well, thank you for the question.
    We were there from October the 4th through the 18th. And as 
I said in my testimony, what the nurses saw was that, when you 
get outside of San Juan, that they were pretty much cut off 
from electricity, from communication, from anything. So, when 
you ask me what was the death toll, do I believe whether it is 
51 versus 911, or somewhere in between, personally, I think it 
is more of the higher.
    What we saw was people were desperate. We were considered 
almost the first ones that they even saw as it relates to food 
or water, or any kind of communication. And through word of 
mouth, they did say that the neighbor passed, whether it was 
through leptospirosis or natural causes--you mentioned the lack 
of electricity and without oxygen. So, yes, I think it is 
rather on the high side.
    Mr. Rush. Mr. Nieves, do you have any further insight into 
the actual number of fatalities and the reason for those 
fatalities?
    Mr. Nieves. Yes. Basically, I really agree with Ms. 
Kennedy. The official death toll of 59 up until now is very 
superficial and misleading. By personal experience, I have 
talked with dozens of family, friends, that have told me, ``Oh, 
my grandmother died. She passed because she didn't have 
electricity in her nursing home.'' A lot of elderly people that 
do not have electricity are simply dying.
    And so, how can you relate that to Hurricane Maria? It is 
very difficult because it didn't happen that day. But the death 
toll is, in my view, in the hundreds.
    Mr. Rush. So, even today, as we sit here in this committee 
room, there are people who are still dying in Puerto Rico 
simply because they have no electricity, even today?
    Mr. Nieves. Yes. As I said in my testimony, people are 
dying today not because of Hurricane Maria, but because of 
Hurricane PREPA, because they don't have electricity in their 
homes and care centers.
    Ms. Catherine Kennedy. I would agree. Without electricity, 
without power, you know, there are stories where patients 
actually go to San Juan when the electricity is up, and they 
take their nebulizers and plug them in, so that they can do the 
breathing treatments. Or they may sit in clinics where they 
have access to oxygen and use the oxygen there throughout the 
day, and then, they go home where there is no electricity and 
they are without oxygen, without anything.
    Mr. Rush. Thank you, Mr. Chairman. I yield back.
    Mr. Olson. The gentleman yields back.
    The Chair now calls upon the gentleman from Illinois, Mr. 
Shimkus, for 5 minutes.
    Mr. Shimkus. Thank you, Mr. Chairman.
    It is great to have you here. I want to direct some of my 
questions to Mr. Fanning.
    Mr. Fanning, if the electricity went out in Atlanta, 
Georgia, who would get called?
    Mr. Fanning. Initially, Paul Bowers, President of Georgia 
Power Company, but that is a pretty clear deal.
    You know what is interesting in these storms, we have, 
essentially, people that run the storm activity. They are fully 
empowered to work with whatever State, local, Federal 
government, to get the lights on as fast as we can. They have a 
clear sense of priority and they get the job done.
    Mr. Shimkus. Again, Puerto Rico is an island. It is very 
difficult, and I kind of wish the administration would have 
deployed the 82nd Airborne and just had a parachute jump into a 
lot of communities that don't have access. At least there would 
be a meal ration. And the military has even solar packs that 
they take in Afghanistan. If there was one thing I wish they 
would have done more than anything, it is really deployed.
    But you also heard in the first panel that the fact that 
there was no request for help until five weeks later. That is 
not normal. I mean, you represent the Electricity Subsector 
Coordinating Council.
    Mr. Fanning. That is right.
    Mr. Shimkus. Isn't that something that you all do as part 
of that?
    Mr. Fanning. Absolutely. In fact, I would argue, especially 
this year--the Electricity Subsector Coordinating Council was 
originally formed to focus on cyber and physical security. We 
have added to that, given the success we have demonstrated on 
those issues, this notion of storm response.
    Following Sandy, the electric utility industry reorganized 
what we call regional mutual assistance groups. And so now, 
under the kind of structure of the ESCC, we bring together, 
really for the first time, an enhanced collaboration, not only 
of investor-owned utility responses, but also collaboration/
coordination with municipal utilities, cooperative utilities.
    We offer that up and we participate in a series of 
restoration activities, Federal Government, local, and with 
each other. And we do that, also, interdependent with the other 
kind of industries that you all were talking about in the last 
segment. And that is telecom, so important; water and sewer; 
health care.
    Believe it or not, we go beyond the notion of offering 
assistance just for the restoration of electrons. In Houston, 
particularly, my company got called on for two things that had 
nothing to do with electricity.
    One was for the humanitarian rescue effort. Within 20 
minutes of a phone call, we sent forward pilots and drones to 
help identify where survivors and other people may be.
    Secondly, through Alabama Power, we delivered machinery 
that was able to operate in very high water conditions that 
were used to help rescue people.
    Mr. Shimkus. Thank you.
    And PREPA, or the Puerto Rican Electric Power Authority, 
they are not involved in this group, are they?
    Mr. Fanning. So, PREPA works under the aegis of the 
American Public Power Association, which is, essentially, a 
municipal organization. We offered help, but PREPA, the State 
of Puerto Rico, for whatever reason, elected to pursue a 
different path, not pursue the mutual assistance rubric and 
really go through bilateral----
    Mr. Shimkus. Yes, and let me go to the elected 
representative, Mr. Nieves. When we look back now on lessons 
learned and how we want to move forward, would you agree that 
we probably should look at ways in which the whole community 
can be helpful and develop these memorandums of understanding 
where we can get joint use and quick response? That would be 
probably a pretty good lesson learned in this?
    Mr. Nieves. Well, the thing is, the fact is that the 
American Public Power Association, and I understand that at 
least the Electric Institute offered since day one mutual 
assistance to PREPA, but PREPA pursued another way. So, it is 
not a lack of an agreement, but it was a lack of will from 
PREPA's part. And then, we have the Whitefish situation.
    Mr. Shimkus. Yes, yes. And I am sure we are going to have 
time to continue to look at that. But, believing your 
testimony, which I do, that is, I would call that criminal 
negligence. And I am sorry for that.
    My time has expired, Mr. Chairman. I yield back.
    Mr. Olson. The gentleman yields back.
    The Chair now calls upon the gentlewoman from Florida 14, 
Ms. Castor, for 5 minutes.
    Ms. Castor. Thank you, Mr. Chairman.
    Thank you all very much for being here.
    The more we hear directly from folks like you that are in 
the U.S. Virgin Islands and Puerto Rica, the more disturbing it 
gets. I think you can sense the outrage building from this 
committee over the Puerto Rico Electric Power Authority.
    Mr. Nieves, are you surprised that PREPA did not respond to 
this committee and, in essence, refused to appear here?
    Mr. Nieves. I am sad to say that I am not surprised. When I 
used to Chair the Senate's Energy Committee, one of the things 
that we found is their total lack of transparency. So, to me, I 
assume this is a lack of respect for this committee that PREPA 
is not here on this group.
    Ms. Castor. And were you surprised to hear Mr. Alexander, 
who is the lead for the U.S. Army Corps of Engineers in 
repairing the grid in Puerto Rico, were you surprised to learn 
that he hasn't even been able to have a conversation with 
PREPA.
    Mr. Nieves. Sadly, I am not surprised.
    Ms. Castor. So, how do we justify taxpayer dollars now 
going to repair a grid in Puerto Rico, trying to work with 
PREPA after they refused to interact with the committee? They 
are not working with the Army Corps of Engineers. They are 
wasting taxpayer money through this Whitefish contract that has 
outraged so many people. And yet, the need is so great on the 
island. How do you recommend that we move forward? We are going 
to have to address the PREPA situation in law as soon as 
possible, I would assume.
    Mr. Nieves. Yes. First of all, we have to really understand 
and consider at the end of the day, given PREPA's governance 
problems, we need to think that people are dying. Our economy 
is dying. So, how do we work around that, or PREPA's lack of 
governance and transparency?
    My suggestion, and that I did in my testimony, is that 
since Congress already passed the PROMESA act, and the 
oversight board named a Revitalization Coordinator that has 
been appointed to take over PREPA, that Congress finds a way, a 
mandate, a specific mandate, that Federal taxpayer money to 
create a new energy grid be under the supervision of the 
Revitalization Coordinator of the board and the Puerto Rico 
Energy Commission, which is an independent, non-political, 
nonpartisan, and highly technical body. So, you can bypass 
PREPA and the government of Puerto Rico. So, that could be a 
way to get around it.
    Ms. Castor. And this has to be, we have to have a sense of 
urgency to do this, because they are talking about the next 
emergency bill maybe will be in December, hopefully. I mean, 
there is a lot of things on the agenda for Congress in 
December. But time is of the essence here.
    Mr. Nieves. Yes.
    Ms. Castor. And, Colleagues, we simply have to find a way 
to at least begin to plan to build in some resiliency, get the 
power on, but begin to lay the groundwork for a modern electric 
grid, and address the ineptitude of the Puerto Rico Electric 
Power Authority. Lives hang in the balance.
    We have the experts at our fingertips. We have the 
technology to do this. Does Congress have the capacity to act 
with a sense of urgency, knowing how our fellow citizens are 
suffering there? So, that is a challenge for us.
    So, I thank you all very much for being here.
    And I yield back my time.
    Mr. Olson. The gentlelady yields back.
    The Chair now calls upon the gentleman from Mississippi, 
Gregg Harper, for 5 minutes.
    Mr. Harper. Thank you, Mr. Chairman. Congratulations to the 
Astros.
    Mr. Olson. Thank you.
    Mr. Harper. And I know it was a great series.
    I want to thank each of you for being here. This is still 
something that just is stunning, the hurricanes we have had to 
deal with this season. And certainly what has happened in 
Puerto Rico has concerned us all.
    So, Mr. Fanning, I know you mentioned that it is more than 
just power or restoration of power. It is also telecom, water 
and sewer issues. Can you talk for a moment and tell us how 
utilities use their communications network to recovery and 
respond from hurricanes and other weather-related events, and 
how reliable do those communications networks need to be?
    Mr. Fanning. Yes. Thank you, Congressman, and thank you for 
your service to the great State of Mississippi.
    Mr. Harper. Thank you.
    Mr. Fanning. The best example of that is Katrina, as you 
well know. I think Katrina and the national story gets told 
around New Orleans in the breaching of the dam. The truth is, 
in Mississippi, when Katrina came through, every light was out 
around Mississippi Power.
    And when you went in to try to restore that activity, the 
streets were unrecognizable. You couldn't even use, 
essentially, GPS to find your way around. All of the telecom 
was out as well.
    We have to have an interconnected effort between telecom 
and electricity in order to most efficiently respond to these 
sorts of disasters. Southern Company, as a matter of its own 
resilient strategy, has our own dedicated telecom company 
called Souther Linc, in which we can bring in mobile cells on 
wheels, towers essentially, to set those things up.
    As I am working within the context of the ESCC as it 
relates to Puerto Rico, early on--and this is where the ESCC 
was not asked to help in a mutual assistance effort--but, 
still, we were working with different parts of the economy to 
try to bring help to that island.
    I called personally John Donovan. He is roughly the No. 2 
guy at AT&T, as I understand it. And also, at--hold on--at 
Verizon, Lowell McAdam, who is the CEO there, to link together 
our efforts in bringing help down there. And we assured each 
other that, between telecom and electricity, we would provide 
every level of support, whether it was even asked for or not, 
to try to get that situation rectified.
    Congressman, it is critical. If we are going to communicate 
with people in the field, if we are going to have people in the 
field without telecom, we need some way to kind of communicate 
to get the stuff back on. It is absolutely critical.
    Mr. Harper. So, you provided assistance in that area, even 
though it was not requested by PREPA?
    Mr. Fanning. That is right. And in fact, I will give great 
kudos to the folks at FEMA, whether it is Brock Long who has 
done a heck of a job. I was on the floor of FEMA during a 
weekend during this situation. Another guy that works in DHS, 
Chris Krebs; in the White House, Tom Bossert, all of these 
people have been champions in trying to aid the situation 
without a whole lot of encouragement.
    Mr. Harper. Got you.
    You know, Southern Company is right in the middle of what I 
guess we would call the hurricane belt. But Southern Company 
has a long and good track record of restoration after a 
hurricane, not only in your home service area, but helping your 
neighbors, certainly through the ESCC and others.
    Have you seen changes based on lessons after Katrina that 
you are using today to improve that?
    Mr. Fanning. Oh, sure. We have this mantra I had in my 
opening statement. We want to be today better than yesterday; 
tomorrow better than today. And no matter how good we think we 
are, we can always be better, me included.
    And we are accountable for always improving. When you think 
about some of the testimony, life-and-death matters that are at 
stake here, you know, it isn't just about electrons; it is 
about restoring hope to communities and people's ways of life.
    And so, we always work hard to think about what we can do 
better. I think the latest iteration, whether it is Harvey, 
whether it is Irma, the ESCC has demonstrated a much better 
capability of working across not only investor-owned utilities, 
munis, and coops, but also across cross-sector industries, 
telecom, finance----
    Mr. Harper. Right.
    Mr. Fanning [continuing]. Water, et cetera. And so, those 
are particularly good things.
    The other thing is this whole notion--and we have heard a 
lot about new technology being brought to bear. Good heavens, 
we deployed that in terms of resiliency as a strategic 
objective of America, whether it is cybersecurity, protection 
against terrorists from a physical standpoint, but also against 
natural disasters.
    Mr. Harper. Fine. Thank you, Mr. Fanning.
    My time has expired. I yield back, Mr. Chairman.
     Mr. Olson. The gentleman yields back.
    The Chair now calls upon the gentleman who made sure that 
Texans signed Justin Verlander to get us through the playoffs 
here, Gene Green, Texas 29.
    [Laughter.]
    Mr. Green. I wish I could claim, except going to a couple 
of the games. But thank you, Mr. Chairman.
    Mr. Thompson, you talk about how quickly refined production 
was back online after Harvey. And I would like to commend the 
job industry did in our district, because in east Harris County 
we have five refineries. I sat down and met with Lyondell 
refinery and, also, with Shell. And a lot of folks don't 
understand you just can't turn switches off and on and get them 
back up. But now the price of gas is going down because all 
those refineries are back up. I know in our area--and I assume 
over in Beaumont-Port Arthur also--I know a lot of my 
constituents worked around the clock to get that back up.
    One of the concerns I had, though, was the issue with the 
tanks. In east Harris County, we have the tanks that are--we 
keep building them because it is either holding crude or 
product or whatever. The engineering of them now is a floating 
roof. Because of the amount of water that hit the top of that, 
it actually turned that top over, and water went into whatever 
product was there. It could have been crude oil; it could have 
been refined products, and emissions from that, but also 
overflowing. Because when you get 52 inches of rain anywhere, 
you are going to have a problem.
    Has the industry looked at what we are going to do? I know, 
talking with the two companies, they said, we are going to have 
to look at it because how do we plan for 52 inches of rain. But 
see if engineering-wise there is a way we don't repeat that 
problem if we have another--well, not if; it is when we are 
going to have another storm because on the Texas Gulf Coast--I 
am a native Houstonian; we have lived through them, and we will 
get through this, too, but it is not pretty. But we need to 
learn from our mistakes if we have another 52-inch rain in 
those plants.
    Has there been talk about how, across from API--because, 
like I said, just talking with two companies, they said they 
had to look at it and see what is going on.
    Mr. Thompson. Thank you for the remarks.
    Yes, our industry, as I have said open remarks, we fared 
fairly well. We proved to be resilient. We weren't perfect by 
any stretch of the imagination. We were better prepared than we 
were in prior storms. We have installed a lot of floating 
roofs, which you know are better for the environment. In the 
normal States, emissions are much lower.
    But we weren't prepared for 60 inches of rain at times. And 
so, some tanks did have some failures. But the key is that was 
the exception and not the rule----
    Mr. Green. Yes.
    Mr. Thompson [continuing]. For sure. And I can assure you 
that this is already a No. 1 topic of conversation, about to 
prevent this going forward, and there will be lots of 
discussion. And I am sure there will be engineering to make 
sure these problems don't happen going forward, to the best we 
can.
    Mr. Green. OK. Can you talk a little bit about the 
difference in how quickly the refining sector came back up 
online, and the difficulty, how long it took for the 
petrochemical sector in Houston?
    Mr. Thompson. Yes. Well, certainly the refining industry 
came back online a little bit more quickly. A lot of that was 
from preparation. The petrochemical side, we knocked out, as 
you know, 60 percent of the national capacity, 80 percent in 
the Gulf. About 75 percent of that capacity has returned to the 
industry. Some of our facilities, they were under lots of water 
and it has taken a lot of time to get those facilities back up. 
Repairs have had to be made, and that just takes time. But we 
are well on our way. We think we have turned the corner and, 
hopefully, we will be back up to full capacity soon.
    Mr. Green. And I also know that you can tell that at the 
price at the pump because the prices went up 25-30 cents a 
gallon, but now it is back down, maybe not in Washington, but 
at least in southeast Texas it has gone back down to maybe a 
little higher than it was, but still it is not $2.49; it is 
$2.19 that you can get on the side of the road now.
    Mr. Thompson. And certainly we are getting back closer to 
prehurricane levels, but one thing I will point out is, since 
that time, the price of crude oil is certainly higher.
    Mr. Green. Yes.
    Mr. Thompson. And so, some of that is being reflected at 
the pump as well.
    Mr. Green. Yes.
    I yield back, Mr. Chairman. Thank you.
    Mr. Olson. The gentleman yields back.
    The chairman now calls upon the House's best birdwatcher, 
the man from the Commonwealth of West Virginia----
    Mr. Griffith. Virginia.
    Mr. Olson. I am sorry. Virginia. I am confused.
    [Laughter.]
    Mr. Griffith. You have been in the chair a long time.
    [Laughter.]
    I appreciate it.
    Mr. Olson. Five minutes, my friend.
    Mr. Griffith. Thank you very much.
    Mr. Fanning, Mr. Harper touched on this a minute or two 
ago, but making sure we have lines of communication up. The 
National Infrastructure Advisory Council, noting this absolute 
criticality that communications play in grid resilience, 
suggested that electric utilities may need some dedicated 
spectrum space. What do you think?
    Mr. Fanning. Well, listen, there is a number of solutions 
that go to that very important problem. Even to be provocative, 
in the circumstance of a national emergency, should you have 
dedicated internet access? There is a lot of things that you 
need to clear the way for.
    Let me just give great kudos. So many people today I think 
lose faith in Government and the institution and the people 
that run it, and all that. I can say without equivocation that, 
in response to these events, whether it is in the White House 
with Tom Bossert, whether it is Energy Secretary Perry, one of 
the things that we can do is to work with these folks. And 
these folks can clear the way to get the work done.
    So often, I think the question goes to who is in charge. 
You know who really knows how to get stuff done are the line 
crews and the supervisors and the people that have the boots on 
the ground to get this done. And when there are barriers, what 
we have got to do is work in this effective public/private 
partnership to get whatever barriers exist cleared away. The 
Government in this case has been fabulous during Harvey and 
Irma particularly.
    Mr. Griffith. I appreciate that, and thank you for your 
answer.
    Mr. Rhymer, I was very pleased, as I was listening to your 
testimony, to hear you talk about microgrids and what you all 
are planning on doing. I particularly like the way you 
described how you are going to have them interact with the full 
system, and then, if they need to be standalone--I thought that 
was very good and I appreciate it. I hope you all success in 
that, and I look forward to seeing it at some point when it is 
working, because I think that is helpful. Not just in the 
islands, but in mountains and other regions of the United 
States those kinds of concepts can be very, very helpful. So, 
thank you for that.
    Mr. Rhymer. Thank you.
    Mr. Griffith. Mr. Nieves--did I say that close to right? 
Thanks.
    I appreciated your stark comments. It seems that there have 
been a lot of problems with the electric utility in Puerto Rico 
for some time, based on your comments. I am just wondering, you 
know, the Federal Government is going to be asked to come in 
there and spend a lot of money. I understand that and think 
that is right. But, if we do so, are you willing--do you think 
that the Government there, particularly the electric utility, 
is going to be willing to introduce some of these novel 
concepts like microgrids, and working on ways to use Puerto 
Rico as a land of experiments where we can try different 
things? They won't all necessarily work, but things that we can 
do to try to make the grid better long time, and try out some 
of these new ideas that are out there that have been talked 
about for years, but we have never had an opportunity.
    And for all the tragedy that is taking place in Puerto 
Rico, for which I am very sorry and worry about figuring out 
what we can do, we may have the opportunity to do something 
better. Do you think that the utility company would be willing 
to embrace some of that?
    Mr. Nieves. Well, my proposal during testimony is that, if 
the Federal Government is going to step up and allocate 
considerable resources to not just repair the old grid, but to 
create a new grid, you cannot do that alone. You have to also 
establish a specific mandate in the law saying we are 
appropriating this ``X'' amount of dollars to build a new grid 
for Puerto Rico, but with these specifications.
    And I respectfully submit that macrogrids could work; 
regional microgrids for Puerto Rico could really work to create 
a strong, resilient system. That might as well be ordered by 
Federal law.
    Under Puerto Rico local law that I worked on last year when 
I was a senator, we authorized microgrids. And the Puerto Rico 
Energy Commission is right now working on an expedited 
regulation to put them in place. But I really submit that ``X'' 
amount of dollars appropriated by our Federal Government have 
to be with a specific Federal mandate.
    Mr. Griffith. And I appreciate that and would agree that we 
are going to have to do some different things there. One of the 
things that I think might help is if we have the utility 
accountable to shareholders. I don't know how you would spin 
that off with the assets they have. But I noticed from your 
comments that one of the problems was that you had, while it 
was a semi-regulated monopoly, it was a nonprofit. And it is 
amazing, when you are trying to figure out ways to make 
yourself more efficient, you come across ways to make at least 
a little bit of profit, even if it is not required to be much 
profit. Anyway, it is a thought to think about, and I hoped 
that you would consider that as well.
    And my time is way over. So, I have to yield back. Thank 
you.
    Mr. Nieves. Thank you.
    Mr. Olson. The gentleman from the Commonwealth of Virginia 
yields back.
    The Chair now calls upon the gentleman from Amsterdam, New 
York, Mr. Tonko, for 5 minutes.
    [Laughter.]
    Mr. Tonko. Thank you, Mr. Chair.
    Mr. Rhymer, your testimony mentioned that the Water & Power 
Authority had used FEMA hazardous litigation grants to bury 
infrastructure underground, making it more resilient. When did 
you receive those grants?
    Mr. Rhymer. We received those grants approximately in 2010-
2011.
    Mr. Tonko. OK.
    Mr. Rhymer. And we have underground a portion of St. Thomas 
and a portion of St. Croix. We are currently seeking additional 
hazardous litigation grants currently to underground St. John 
in the Cruz Bay area and additional parts of St. Thomas and St. 
Croix.
    Mr. Tonko. OK. And is there any other FEMA money you are 
asking to secure beyond that burying of cable? Anything with 
your microgrids? Are you requesting----
    Mr. Rhymer. Well, we are seeking to get litigation grants 
for the microgrid stuff, renewable energy stuff that actually 
adds to the microgrid. We are also looking to do some hardening 
of the system in terms of administration, in terms of the 
buildings. Like the line department building is completely 
destroyed. So, basically, we need to have that building be 
resilient.
    Mr. Tonko. Thank you.
    New York State and the utilities there benefitted greatly 
from mutual assistance in the aftermath of Superstorm Sandy. 
And now, it is our turn to be called upon. It is your turn to 
be called upon in making things better.
    Mr. Fanning, do you believe the utility industry's mutual 
assistance efforts work well?
    Mr. Fanning. Oh, they are outstanding.
    Mr. Tonko. I know islands present unique challenges to 
mobilizing workers and equipment, but can you think of specific 
reasons why mutual assistance would be resisted?
    Mr. Fanning. No.
    Mr. Tonko. OK. Mr. Nieves, you testified that Puerto Rico's 
grid had limitations certainly in the amount of renewable 
resources that could be integrated into its energy mix. What 
were the reasons for that?
    Mr. Nieves. Yes. According to a 2014 report that PREPA 
received, the grid, as it stood before Maria, could only 
integrate up to 580 megawatts of renewable power. Renewable 
power has certain technical issues that the grid that we had 
could not really tolerate without jeopardizing the system.
    Mr. Tonko. Is it a matter of better interconnect devices? 
There is technology already shelf-ready, I would believe, that 
might be able to help----
    Mr. Nieves. That is correct.
    Mr. Tonko [continuing]. Your situation?
    Mr. Nieves. Well, PREPA's grid was not a smart grid. It was 
not a grid that could really accommodate a system whereby 
customers are also generating power, renewable power, so they 
are not just passive customers of our energy model. So, 
according to that report from Siemens, PREPA's grid only can 
tolerate up to that amount of renewable power, which is really 
unacceptable, and a really small amount.
    Mr. Tonko. And, Ms. Kennedy, thank you for making it so 
clear that Puerto Ricans are still dealing with a life-and-
death situation. Can you further explain the health impacts you 
have seen due to a lack of safe water in Puerto Rico?
    Ms. Catherine Kennedy. Sure. Like I said, we were there for 
about two weeks. One of the things that the nurses had to go 
out and do was really within the community to take a look at 
what kind of resources were available. Time and time again, it 
was the lack of clean running water.
    One of the things that the nurses saw was that people were 
very desperate. So, they were actually drinking from river 
water. Water that came down they would save from their roofs. 
As you know, with hurricane, you have rodents and, of course, 
bacteria. So, the prospect of leptospirosis was imminent. And 
clearly, there were people that were infected, but, again, if 
treated properly, then, I mean, it wouldn't be life 
threatening. But these were things that we saw for the last two 
weeks.
    Mr. Tonko. Right. I have also seen some photos shared with 
me by family members in my district. They cause grave concern.
    I believe--and I think Ms. Kennedy would agree--that we 
need to have a serious discussion about waiving cost-sharing 
requirements, especially for critical public health 
infrastructure such as our water systems. It is a public health 
and public safety situation.
    I would also express that Puerto Rico can learn a great 
deal from New York's REV Initiative. It was in response to the 
Superstorm Sandy situation. And that State, our State, my home 
State, has worked to understand changes in the traditional 
utility business model and how to plan for a more decentralized 
grid.
    My concern is that, if we build back to this failed system 
that you cite, it is a very troublesome investment made by any 
level of Government and the private sector, and we need to do 
better than that and encourage smart, flexible, and reliable 
grid for a cleaner and stronger energy future.
     And with that, I yield back. And congratulations on last 
night.
    Mr. Olson. Thank you, thank you, thank you.
    The gentleman yields back.
    The Chair now calls upon the gentleman from our neighbor to 
the north, Oklahoma, Mr. Mullin, for 5 minutes.
    Mr. Mullin. Chairman, you are in almost a giddy form today. 
I wonder why.
    [Laughter.]
    Mr. Olson. Guilty as charged.
    Mr. Mullin. The best thing is the third baseman for the 
Dodgers, I guess, can shave and cut his hair now, right?
    Hey, I appreciate you guys coming up here and informing 
Members of Congress. It is very important for us to have a 
working relationship in a situation like this.
    It has been a long day, and I appreciate your all's 
patience. But I feel like we are going to continue to learn 
from these lessons. What we don't want to do is get in the 
habit of repeating them.
    Mr. Fanning, if you don't mind, I would like to start with 
you. The physical work of the restoration I know falls mainly 
on industries, but what role does the Federal Government play 
in this?
    Mr. Fanning. Oh, they play an exceedingly important role. 
As I described earlier, when I think about the role of the 
ESCC, I describe it kind of in three levels. The first is to 
harmonize the efforts of the Federal Government. This is truly 
a public/private partnership, particularly in a super-regional 
kind of disaster where we absolutely----
    Mr. Mullin. When you talk about a private/private 
partnership----
    Mr. Fanning. Right.
    Mr. Mullin [continuing]. Does the partnership end when the 
Federal dollars are put in and, then, the utility companies 
reap the benefits of it? Or do the Federal dollars, since it is 
a partnership, get paid back?
    Mr. Fanning. Listen, the partnership exists whether there 
is a disaster or not.
    Mr. Mullin. Sure.
    Mr. Fanning. This is our, what we call, playbook.
    Mr. Mullin. Right.
    Mr. Fanning. This is our regime in which we respond to 
cyber, physical security, or natural disasters. And what it 
describes here is, frankly, not only the unity of effort, the 
``what's'' of a restoration effort, but also the unity of 
message and the ``how's'' around a restoration effort. That has 
to be coordinated and harmonized between the Federal Government 
and not only electricity in this case, but, as we said before, 
the lifeline sectors. In cyberwarfare, it is going to be in the 
context of finance, telecom, electricity. Broadly, it would 
include transportation and water, and then, there are other 
priorities going from that.
    Don't ever forget the need to harmonize, also, State and 
local government efforts, the boots on the ground that 
ultimately will impact our ability to deliver.
    Mr. Mullin. So, when we are talking about a partnership, 
are we talking about just in financial support or, as you are 
describing, all the above from the logistics behind it, from 
the Federal Government stepping out and getting some of the red 
tape out, letting you guys go to work, getting some waivers in 
place?
    Mr. Fanning. Yes, Congressman, absolutely right. In fact, 
somebody else mentioned this National Infrastructure Advisory 
Council made a recommendation to the President to form 
something called a SICC, Strategic Infrastructure Coordinating 
Council, of electricity----
    Mr. Mullin. We have acronyms for everything around here.
    [Laughter.]
    Mr. Fanning. Yes. Yes, I know it.
    Electricity, finance, telecom. And what we will do is bring 
CEOs together, so me and others representing the electricity 
sector, finance, telecom, to put together a common set of 
regulatory permissions, legislative initiatives, harmonizing 
technology systems, information-sharing, and physical 
coordination. If we can get that done, that is an enormous 
activity.
    The other thing that I think we need to do is inform 
policymakers like you all. And that is why I applaud this 
effort. Because there is so much noise around these kinds of 
disasters or potential disasters, we have to take action before 
they get here. If all we are doing is reacting to the latest 
disaster----
    Mr. Mullin. Thank you.
    Mr. Fanning [continuing]. We are way behind the ball.
    Mr. Mullin. Yes.
    Mr. Fanning. We have got to pitch, not catch.
    Mr. Mullin. No, I agree with that. But look at that; wasn't 
that neat. You get a little zing in there for our chairman. 
Wow. That was thinking on your feet.
    [Laughter.]
    I agree with that. We would love to move to a point of 
being more proactive than reactive, and take the lessons 
learned. So, I actually applaud the idea of putting together 
that committee, so to say, where we can say, ``Hey, look, this 
is our lessons. These are what we need. These are the 
roadblocks that need to be dropped. This is why it happens.'' 
And let's move forward, so we can react faster.
    Mr. Fanning. And, Congressman, I think it needs to be CEO-
led. Eighty-seven percent of the critical infrastructure is 
owned by private industry.
    Mr. Mullin. Right.
    Mr. Fanning. We have to work together.
    Mr. Mullin. Mr. McBrayer, I have got just a short time 
here. The EPA issued several fuel waivers----
    Mr. McBrayer. Yes.
    Mr. Mullin [continuing]. Along the way for diesel and 
gasoline that maybe didn't meet the standards, but was able to 
get delivered. Was it effective? Was that helpful?
    Mr. McBrayer. I think it was effective and helpful at the 
time. I think one of the things we have to adjust to as it 
relates to getting fuel to folks who are your constituents, our 
consumers, is that, at least in the Southeast, we are 
transitioning from summer-grade gasoline to winter-grade 
gasoline on September 15th every year. Because of the nature of 
the two specifications, winter-grade gasoline is less costly 
than summer-grade gasoline. So, whether your inventory is in 
your store or whether you are a placeholder for inventory in a 
terminal, the financial incentive is to diminish the amount of 
supply that you have going into September 15 and 16 because you 
are going to take in many cases a 10-to-15-cent devaluation of 
that inventory, basically, at 12:01 a.m. on the 16th.
    One of the things I would ask from a Federal perspective is 
to take a look at that date. Is that really the only date that 
we can in the Southeast convert from the lower-RVP to the 
higher-RVP gasoline? Or is there a way to allow that date to 
move from time or time, or be fixed, so that folks like 
RaceTrac and other members of our association are not forced by 
the changing cost to diminish inventories in a time where 
hurricanes are more likely to occur?
    Mr. Mullin. Thank you. That is a great point.
    And, Mr. Chairman, thank you for entertaining a little bit 
more time there. I yield back.
    Mr. Olson. And seeing only Astros fans, but no further 
Members seeking to ask questions, I would like to thank all of 
our witnesses again for being here today.
    I have a unanimous consent and our nine documents for the 
record.
    No. 1 is the PREPA letter to EEI and APPA.
    No. 2 is an APPA letter to the Energy and Commerce 
subcommittee on mutual aid.
    No. 3 is an APPA and EEI letter to Mr. Ricardo L. Ramos 
Rodriguez.
    No. 4 is a letter from a farmer to the Energy and 
Commerce's Energy Subcommittee.
    No. 5 is the EIA supplemental testimony with 
attachments.\1\
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    \1\ The information has been retained in committee files and also 
is available at  http://docs.house.gov/meetings/IF/IF03/20171102/
106573/HHRG-115-IF03-20171102-SD003.pdf.
---------------------------------------------------------------------------
    No. 6, AdvaMed letter.
    No. 7, letter from the FDA.
    No. 8, GridWise Alliance document.
    No. 9, letter to Senators Murkowski and Cantwell from the 
former EPA official and Puerto Rico Energy Commissioner.
    Without objection, so ordered.
    [The information appears at the conclusion of the hearing.]
    Mr. Rush. Mr. Chairman, I want to restate or reiterate my 
request that PREPA be subpoenaed and that we have FEMA before 
this subcommittee in the near future.
    Mr. Olson. As I told my friend, I will carry that message 
to Chairman Upton and Chairman Walden.
    Pursuant to committee rules, I will remind members that 
they have 10 business days to submit additional questions for 
the record. As to the witnesses, submit their response in 10 
business days upon receipt of those questions.
    And one final comment, a point of personal privilege. You 
guys have, it looks like, 23\1/2\ hours to get to Houston for 
our big parade for our Astros.
    [Laughter.]
    Without objection, the subcommittee is adjourned.
    [Whereupon, at 2:31 p.m., the subcommittee was adjourned.]
    [Material submitted for inclusion in the record follows:]
    
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