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


            THE FISCAL YEAR 2019 DEPARTMENT OF ENERGY BUDGET

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

                                HEARING

                               BEFORE THE

                         SUBCOMMITTEE ON ENERGY

                                 OF THE

                    COMMITTEE ON ENERGY AND COMMERCE
                        HOUSE OF REPRESENTATIVES

                     ONE HUNDRED FIFTEENTH CONGRESS

                             SECOND SESSION

                               __________

                             APRIL 12, 2018

                               __________

                           Serial No. 115-117
                           
 [GRAPHIC NOT AVAILABLE IN TIFF FORMAT]                         


      Printed for the use of the Committee on Energy and Commerce

                        energycommerce.house.gov
                        
                        
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                    COMMITTEE ON ENERGY AND COMMERCE

                          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
                         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)
JEFF DUNCAN, South Carolina
GREG WALDEN, Oregon (ex officio)
  
                             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...........................................     7
Hon. Frank Pallone, Jr., a Representative in Congress from the 
  State of New Jersey, opening statement.........................     8

                               Witnesses

Rick Perry, Secretary, U.S. Department of Energy.................     9
    Prepared statement...........................................    12
    Answers to submitted questions \1\...........................   121

                           Submitted Material

Statement of 23 bipartisan Members of Congress...................    74
Letter to President Donald Trump from Members of Congress........    77
Statement of Representative David B. McKinley....................    81
Letter to Director Mick Mulvaney from Pacific Northwest 
  delegation.....................................................    85
Statement of the Utilities Technology Council....................    88
Statement of the R Street Institute..............................    90
Letter to President Donald Trump from Members of Congress........    92
Letter to President Donald Trump from the International 
  Brotherhood of Teamsters.......................................    94
Letter to President Donald Trump from the United Mine Workers of 
  America........................................................    96
Letter to President Donald Trump from the International 
  Brotherhood of Boilermakers, Iron Shipbuilders, Blacksmiths, 
  and Forgers and Helpers........................................    98
Letter to President Donald Trump from the Utility Workers Union 
  of America.....................................................   100
Letter to Secretary Perry from the Energy Industry Trade 
  Association....................................................   102
Letter to Secretary Perry from the Pennsylvania Public Utility 
  Commission.....................................................   107
Letter to Secretary Perry from FirstEnergy \2\
Response letter to Secretary Perry from PJM......................   113
Letter from NEI to Chairman Walden...............................   115

----------
\1\ The committee did not receive a response to Mr. Perry's 
  submitted questions for the record by the time of printing.
\2\ The information can be found at: https://docs.house.gov/
  meetings/IF/IF03/20180412/108114/HHRG-115-IF03-20180412-
  SD049.pdf.

 
            THE FISCAL YEAR 2019 DEPARTMENT OF ENERGY BUDGET

                              ----------                              


                        THURSDAY, APRIL 12, 2018

                  House of Representatives,
                            Subcommittee on Energy,
                          Committee on Energy and Commerce,
                                                    Washington, DC.
    The subcommittee met, pursuant to call, at 10:00 a.m., in 
room 2123 Rayburn House Office Building, Hon. Fred Upton 
(chairman of the subcommittee) presiding.
    Members present: Representatives Upton, Olson, Barton, 
Shimkus, Latta, Harper, McKinley, Kinzinger, Griffith, Johnson, 
Long, Bucshon, Flores, Mullin, Hudson, Cramer, Walberg, Duncan, 
Walden (ex officio), Rush, McNerney, Peters, Green, Doyle, 
Castor, Sarbanes, Tonko, Loebsack, Schrader, Kennedy, 
Butterfield, and Pallone (ex officio).
    Staff present: Mike Bloomquist, Staff Director; Samantha 
Bopp, Staff Assistant; Daniel Butler, Staff Assistant; Kelly 
Collins, Legislative Clerk, Energy/Environment; Wyatt 
Ellertson, Professional Staff, Energy/Environment; Adam Fromm, 
Director of Outreach and Coalitions; Jordan Haverly, Policy 
Coordinator, Environment; Ben Lieberman, Senior Counsel, 
Energy; Mary Martin, Chief Counsel, Energy/Environment; Drew 
McDowell, Executive Assistant; Brandon Mooney, Deputy Chief 
Counsel, Energy; Mark Ratner, Policy Coordinator; Annelise 
Rickert, Counsel, Energy; Dan Schneider, Press Secretary; Peter 
Spencer, Professional Staff Member, Energy; Jason Stanek, 
Senior Counsel, Energy; Austin Stonebraker, Press Assistant; 
Hamlin Wade, Special Advisor, External Affairs; Everett 
Winnick, Director of Information Technology; Andy Zach, Senior 
Professional Staff Member, Environment; Priscilla Barbour, 
Minority Energy Fellow; Jeff Carroll, Minority Staff Director; 
Jean Fruci, Minority Energy and Environment Policy Advisor; 
Tiffany Guarascio, Minority Deputy Staff Director and Chief 
Health Advisor; Zach Kahan, Minority Outreach and Member 
Service Coordinator; Rick Kessler, Minority Senior Advisor and 
Staff Director, Energy and Environment; Jourdan Lewis, Minority 
Staff Assistant; John Marshall, Minority Policy Coordinator; 
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.

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

    Mr. Upton. Good morning, everyone. So it has been 6 months 
to the day, Mr. Secretary, since you last appeared here and I 
certainly welcome you back. We all do. And at that October 12th 
hearing we talked about your efforts to refocus the 
Department's limited budget resources to address what you see 
as the most pressing challenges.
    You outlined a number of priorities which included 
promoting the Nation's energy security, strengthening the 
Nation's national security and nuclear deterrent, spurring 
innovation, and yes, cleaning up the legacy Cold War sites. The 
proposed $30.6 billion budget that we are discussing today 
reflects those priorities.
    There is $15 billion for the National Nuclear Security 
Administration which would continue critical spending for DOE's 
defense and national security programs at a level some $2 
billion higher than the previous administration spending. The 
budget maintains about $5.5 billion dollars for the Office of 
Science and its fundamental and basic research programs which 
is the seed bed for innovation. That is up somewhat from the 
previous administration spending. And there is $6.6 billion for 
the Office of Environmental Management, the highest level in 
some 15 years.
    Concerning the various energy programs, the budget provides 
$2.5 billion which represents a substantial cut, overall, from 
the previous spending across these programs. And I would 
encourage you to continue working with the committee to 
identify additional authorities that you need to be more 
effective and I know that you will do that.
    We also need to recognize that as our energy systems, 
market mechanisms, and Federal and State environmental policies 
become more entangled, existing and emerging hazards to energy 
systems may have far more reaching consequences than we may be 
accustomed to. For example, a successful cyber attack on 
certain business systems would certainly undermine confidence 
in energy trading systems even if it doesn't pose a threat to 
physical operations.
    A major cold event like January's bomb cyclone can lead to 
severe shortages in power or energy when people need it most 
or, as testimony at our second modernization hearing this year 
noted, factors that lead to the decline in our Nation's nuclear 
infrastructure can undermine long-term national security and 
the international leadership on nonproliferation and safety.
    So these energy policies and energy securities present 
serious challenges, no question, challenges that transcend our 
current market setup. It is essential for you as Secretary of 
Energy to survey energy and national security risks, to 
identify the implication of our existing energy policy and 
energy infrastructure, recommend appropriate action, and help 
us make more informed policy decisions. Your budget should 
provide the resources for you to do that work and your 
leadership should focus on tackling those large and 
consequential questions.
    I look forward to this morning's discussions and would 
yield for an opening statement to the ranking member of the 
Energy Subcommittee, Mr. Rush from Illinois.
    [The prepared statement of Mr. Upton follows:]

                 Prepared statement of Hon. Fred Upton

    It has been 6 months to the day since you last appeared 
here, Secretary Perry, and I welcome you back. At our October 
12 hearing, we talked about your efforts to refocus the 
Department's limited budget resources to address what you see 
as the most pressing challenges.
    You outlined several priorities, which included: promoting 
the Nation's energy security, strengthening the Nation's 
national security and nuclear deterrent, spurring innovation, 
and cleaning up the legacy Cold War sites.
    The proposed $30.6 billion budget we are discussing today 
reflects those priorities. There is $15 billion for the 
National Nuclear Security Administration, which would continue 
critical spending for DOE's defense and national security 
programs at a level some $2 billion higher than the previous 
Administration's spending.
    The budget maintains about $5.4 billion for the Office of 
Science and its fundamental and basic research programs, which 
is the seedbed for innovation. This is up somewhat from the 
previous Administration's spending. And there is $6.6 billion 
for the Office of Environmental Management--the highest level 
in 15 years.
    Concerning the various energy programs, the budget provides 
$2.5 billion, which represents a substantial cut overall from 
previous spending across these programs. This has raised 
questions and concerns from Congress, which I am sure you are 
prepared to discuss today.
    The questions the budget raises are important. Examining 
spending priorities in an era of constrained budgets, 
identifying ways to get more out of each taxpayer dollar spent, 
focusing resources on the most essential and pressing problems 
are critical for successful Secretarial management.
    This Committee's work on DOE modernization is intended to 
strengthen your ability as Secretary to manage and execute the 
Department's missions.
    Our most critical modernization priority right now is to 
make sure the Department can confront the emerging threats to 
our nation's energy security.
    This involves enhancing the Department's cybersecurity and 
emergency response capabilities, which are needed for a wide 
range of emerging threats to our energy systems.
    Your new office to focus on cybersecurity and energy 
emergencies makes sense. It is responsive to concerns this 
Committee has raised over the years that DOE's energy security 
functions were buried in programs with other priorities.
    While this action is a positive step, I think the 
Department and policy makers must do more to address emerging 
threats and other hazards to our energy systems--natural and 
man-made.
    This is why we are moving several bi-partisan bills to 
strengthen and clarify DOE's cyber security and emergency 
authorities through the Committee process. And I would 
encourage you to continue working with the Committee to 
identify additional authorities you need to be more effective.
    We also need to recognize that, as our energy systems, 
market mechanisms, and Federal and State environmental policies 
become more entangled, existing and emerging hazards to energy 
systems may have more far reaching consequences than we may be 
accustomed to.
    For example, a successful cyber-attack on certain business 
systems could undermine confidence in energy trading systems, 
even if it doesn't pose a threat to physical operations. A 
major cold event, like January's ``bomb cyclone,'' can lead to 
severe shortages in power or energy when people need it most. 
Or, as testimony at our second modernization hearing this year 
noted, factors that lead to the decline in our nation's nuclear 
infrastructure can undermine long term national security and 
international leadership on nonproliferation and safety.
    These energy policy and energy security present serious 
challenges--challenges that transcend our current market set 
up. It is essential for you, as the Secretary of Energy to 
survey energy and national security risks, to identify the 
implications of our existing energy policies and energy 
infrastructure, recommend appropriateaction--and help us make 
more informed policy decisions.
    Your budget should provide the resources for you to do this 
work. And your leadership should focus on tackling these large 
and consequential questions. I look forward to this morning's 
discussion.

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

    Mr. Rush. Good morning. I want to thank you, Mr. Chairman, 
and I want to welcome you, Mr. Secretary. And, Mr. Secretary, I 
really like how you entered into the room. You came over and 
shook hands on our side of the aisle, here, and your personal 
touch means a lot. And in this era of extremism on both sides, 
really, the human touch you exhibited means a lot to me and I 
want to thank you for it.
    Mr. Secretary, I look forward to working with your office 
to ensure that the Department moves the Nation's energy 
policies forward in a way that benefits all Americans and, 
indeed, benefits all communities. History has shown all of us 
the importance of having people with different perspectives and 
different life experiences at the proverbial table when 
important and consequential decisions are initially being 
considered.
    So when I talk about having diversity in leadership 
positions at DOE, it is not just for the sake of having 
diversity. But rather, it helps to ensure that specific groups 
or communities aren't being excluded whether it is intentional 
or not. When decisions are being made regarding which 
universities are awarded research grants, or which businesses 
can receive contracts, or even how a specific policy might 
impact a particular community, having a sense of diversity, 
having real diversity in demographics and in opinion, helps to 
make sure certain groups aren't being left out. So, Mr. 
Secretary, I look forward to meeting with you soon to discuss 
your thoughts on this very issue and to see how we might be 
able to work together to make sure that the Department is 
providing aid and resources to all communities in a way that is 
sustainable regardless of the administration that is in office.
    Mr. Secretary, besides the objective of making sure the 
Department elects inclusive policies I also have strong views 
in regards to the fiscal year 2019 budget proposal that was put 
forth by the administration. Specifically, this budget proposal 
will cut the Office of Energy Efficiency and Renewable Energy 
by 70 percent from fiscal year 2018 levels with over $600 
million of these reductions coming from energy efficiency 
programs.
    These proposed cuts are a nonstarter as far as I am 
concerned. They would severely and negatively impact low-income 
families throughout my home State of Illinois and the Nation by 
eliminating extremely popular and much-needed initiatives such 
as the Weatherization Assistance Program and the STAR ENERGY 
program. Additionally, the proposal would increase funding for 
the Office of Science, which funds the 17 national 
laboratories, by $869 million from fiscal year 2018 levels, 
eliminating the Advanced Research Program Agency, slash, 
Energy, or ARPA-E.
    The budget proposal would also get rid of all DOE loan 
programs including the Title XVII innovative clean energy 
projects loan program and the Advanced Technology Vehicles 
Manufacturing loan program. Mr. Secretary, this fiscal year 
2019 budget proposal reflects exactly the wrong vision for the 
nNation and it would take us backwards on critical issues like 
climate change, while also hampering American innovation and 
global competitiveness.
    Mr. Secretary, again I want to thank you for being here and 
I look forward to working with you to address these important 
issues going forward. With that, I yield back the balance of my 
time.
    Mr. Upton. The gentleman yields back. The chair would 
recognize the chair of the full committee for an opening 
statement, the gentleman from the good State of Oregon, Mr. 
Walden, for 5 minutes.
    Mr. Walden. Last time it was the great State of Oregon.
    Mr. Upton. I know.
    Mr. Walden. I don't know how we slid downhill.
    Mr. Upton. Michigan is the great State. Oregon is a good 
State.

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

    Mr. Walden. Oh, I see.
    I want to start of course by welcoming the Secretary and 
Mr. Vonglis, thank you both for being here. I believe it is the 
Secretary's second visit before our committee and we appreciate 
that. We like regular visitors here. We don't give, you know, 
Hilton Honor points or anything for your stays, but we do 
appreciate your being here and especially to discuss the fiscal 
year 2019 budget request from the President.
    As we have explored through the DOE modernization hearings, 
lots has changed at the Department of Energy over the 40 years 
since it was first created especially on the national security 
and energy front. And I know that is a passion of yours on 
cybersecurity, Mr. Secretary, and protecting our energy grid, 
our gas pipeline system and all from attack. Under your 
leadership, Mr. Secretary, the Department is undertaking a very 
ambitious set of reforms to strengthen our energy security, to 
reduce regulatory burdens, and to spur economic growth in 
America. Today's hearing will provide you with an opportunity 
to update the committee on the progress made toward achieving 
those goals and to discuss how the budget request will help 
further DOE's mission to advance the national economic and 
energy security of the United States.
    As we have discussed before, DOE and Congress must work 
cooperatively to adapt management and mission priorities to 
reflect the realities of today's world. At my direction, 
Chairman Upton and Vice Chairman Barton have been working with 
Mr. Rush and others in terms of how do we organize the 
Department of Energy for the next generation. And we appreciate 
that work that is underway and we also appreciate the work of 
your team, Mr. Secretary, to give us counsel and guidance from 
time to time as we work on legislation here to strengthen the 
physical security and cybersecurity of the Nation's electric 
grid and pipelines and streamline the process for reviewing LNG 
export applications.
    The Department of Energy has been a good partner and we 
appreciate the testimony and your assistance in fine tuning 
these bills. It is my expectation this constructive approach 
will continue to pay off as we dig deeper to address DOE's core 
missions of nuclear energy, environmental cleanup, and mission-
enabling science.
    The President's fiscal year 2019 budget requests $30.9 
billion for the Department to deliver on its commitments to the 
American people. Almost half that budget would go toward the 
Department's nuclear security mission, roughly a quarter would 
be spent on environmental management, the remaining amount 
would go toward DOE's energy and science programs. I am pleased 
to see that the budget also includes funding to fulfill the 
Department of Energy's legacy cleanup responsibilities 
including at the Hanford Site.
    Now it is located along the Columbia River, you and I both 
went there last August and I appreciated your doing that and 
touring McNary Dam as well. The cleanup work at Hanford 
requires deliberate, careful, and very clear oversight by the 
Department of Energy and we will continue to monitor the 
projects, particularly involving worker safety.
    As we talked before the hearing, Mr. Secretary, I would 
love to explore your views on what has happened recently there 
with some potential radiation emissions from dust and the 
effect on workers and the overall cleanup. While many technical 
and logistical challenges remain, we are beginning to see some 
progress and I trust your renewed focus on Hanford will 
accelerate the results of cleaning up that mess.
    I am pleased the budget includes funding to restart Yucca 
Mountain project--Mr. Shimkus also probably shares some 
happiness with that move--so the waste currently sited at 
Hanford and around the country will be permanently disposed of. 
That remains a big priority for this committee. We will get 
Yucca legislation to the floor. We passed it out here on a big 
bipartisan vote, we want to get it down to the President's 
desk.
    This year's budget request is notable in its emphasis on 
energy security, in particular in combating physical and cyber 
attacks to our nation's energy infrastructure. As the sector-
specific agency for cybersecurity for the energy sector, the 
Department of Energy must ensure unity of effort and serve as 
the day-to-day referral interface for the prioritization and 
coordination of activities across the government.
    As I said, I got a firsthand look at some of DOE's testing 
capabilities and unique facilities and advanced tools during a 
recent visit to the Idaho National Laboratory in Idaho Falls. 
Mike Simpson, my colleague from Idaho, and I were there. Your 
experts are working to protect our economy and safety of our 
citizens from hackers who are waging a continuous cyber war on 
our critical infrastructure in this country.
    Just last month for the first time ever, the Department of 
Homeland Security and the FBI jointly issued an alert formally 
accusing the Russian government of a widespread hacking 
campaign targeting a wide swath of our energy infrastructure 
including our grid, pipelines, and nuclear facilities. I 
commend you, Mr. Secretary, for taking this threat as seriously 
as you do and for your efforts to improve the Department's 
ability to detect and respond to these emergency threats.
    While the Department works to keep the lights on in the 
event of a cyber attack, it is also working to improve the 
resiliency and reliability of the electric grid in the face of 
a rapidly changing power generation mix. So, Mr. Secretary, we 
appreciate that. I will have questions for you about making 
sure that the Bonneville Power Administration remains a vibrant 
part of the Northwest infrastructure. I know the administration 
may have a different view on that but we will overcome that.
    So thank you, Mr. Secretary, delighted to have you here, 
and I yield back the balance of my time.
    [The prepared statement of Mr. Walden follows:]

                 Prepared statement of Hon. Greg Walden

    I'd like to begin by welcoming Secretary Perry to his 
second appearance before the Energy and Commerce Committee to 
discuss the President's Fiscal Year 2019 Budget Request for the 
Department of Energy. As we've explored through our ``DOE 
Modernization'' hearings, a lot has changed since Congress 
created the department over 40 years ago--especially on the 
national security and energy security front.
    Under the Secretary's leadership, the department is 
undertaking ambitious reforms to strengthen our energy 
security, reduce regulatory burdens, and spur economic growth. 
Today's hearing will provide the secretary with an opportunity 
to update the committee on the progress made toward achieving 
the goals he set for the department, and to discuss how the 
budget request will help further DOE's mission to advance the 
national, economic, and energy security of the United States.
    As we've discussed before, DOE and Congress must work 
cooperatively to adapt its management and mission priorities to 
reflect the realities of today. At my direction, Chairman Upton 
and Vice Chairman Barton have begun this work, and it's 
starting to bear fruit. Over the last few months, the committee 
has held legislative hearings on bipartisan bills to enhance 
DOE's emergency response capabilities, strengthen the physical 
security and cybersecurity of the nation's electric grid and 
pipelines, and streamline the process for reviewing LNG export 
applications. DOE has been a good partner, contributing 
testimony and technical assistance to help fine-tune these 
bills. It's my expectation that this constructive approach will 
continue to pay off as we dig deeper to address DOE's core 
missions of nuclear energy, environmental cleanup, and mission-
enabling science.
    The President's FY 2019 budget requests $30.9 billion 
dollars for the Department of Energy to deliver on its 
commitments to the American people. Almost half of the budget 
would go toward the department's nuclear security mission, 
roughly a quarter would be spent on environmental management, 
and the remaining amount would go toward DOE's energy and 
science programs.
    I'm pleased to see that the budget also includes funding to 
fulfill DOE's legacy cleanup responsibilities, including the 
Hanford Site, which is located just across the Columbia River 
from my constituents. The secretary and I toured Hanford 
together last year. The cleanup work at Hanford requires 
deliberate oversight by DOE and we will continue to monitor the 
projects, particularly when involving worker safety. While many 
technical and logistical challenges remain, we're beginning to 
see some progress and I trust that Secretary Perry's renewed 
focus on Hanford will accelerate these results. I'm pleased the 
budget includes funding to restart the Yucca Mountain project, 
so the waste currently sitting at Hanford, and around the 
country, will be permanently disposed.
    This year's budget request is notable in its emphasis on 
energy security, in particular, combating physical and cyber-
attacks to our nation's energy infrastructure. As the sector-
specific agency for cybersecurity for the energy sector, DOE 
must ensure unity of effort and serve as the day-to-day federal 
interface for the prioritization and coordination of activities 
across government.
    I got a firsthand look at some of DOE's testing 
capabilities, unique facilities, and advanced tools during my 
recent tour of Idaho National Laboratory, where our experts are 
working to protect our economy and the safety of our citizens 
from the hackers who are waging cyberwar on our critical 
infrastructure. Just last month, for the first time ever, the 
Department of Homeland Security and the FBI jointly issued an 
alert, formally accusing the Russian government of a widespread 
hacking campaign targeting a wide swath of our energy 
infrastructure, including our grid, pipelines, and nuclear 
facilities. I commend the Secretary for taking this threat 
seriously, and for his efforts to improve the department's 
ability to detect and respond to these emerging threats.
    While the department works to keep the lights on in the 
event of a cyber-attack, it is also working to improve the 
resiliency and reliability of the electric grid in the face of 
a rapidly changing power generation mix. Congress has provided 
the secretary with a variety of tools to address grid 
reliability, including Emergency Order authority under Section 
202(c) of the Federal Power Act to avert a power crisis. While 
this authority has been rarely used in the past, DOE has 
already received two requests within the past 12 months, 
including a potentially precedent-setting request involving 
struggling coal and nuclear plants in the Midwest.
    As I've stated before, I support an all-of-the-above 
approach, and feel strongly that a diverse generation mix is 
essential to our nation's energy security. I look forward to 
continue working with Secretary Perry as he weighs these 
important issues.

    Mr. Upton. The gentleman yields back. The chair would 
recognize the ranking member of the full committee, the 
gentleman from New Jersey, Mr. Pallone, for 5 minutes.

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

    Mr. Pallone. Thank you, Mr. Chairman.
    Secretary Perry, welcome back. I hope you feel welcome, 
because judging by President Trump's fiscal year 2019 budget, I 
think here in Congress we have more confidence in you and your 
Department than in the President. I say that because we 
recently passed a bipartisan omnibus appropriations bill that 
not only increased funding for many DOE programs above the 
President's budget request, but also increased funding above 
2017 enacted levels.
    And I am glad that Congress is going on record that it will 
not accept these severe cuts being proposed by the President. I 
don't envy the position you are in today, having to defend a 
Department of Energy budget that slashes funding for clean 
energy research, walks away from popular efficiency programs 
that save consumers money, eliminates programs that fund 
cutting-edge energy research, and helps low-income families 
weatherize their homes.
    And this budget also slashes federal investments in DOE 
programs that help mitigate carbon emissions which are, as the 
science clearly shows, the main drive of climate change. The 
President's budget proposes a particularly crippling 70 percent 
cut to DOE's Office of Energy Efficiency and Renewable Energy 
and that office has succeeded in growing clean energy 
technology deployment, developing cost-saving energy efficiency 
programs, and promoting advanced vehicles and alternate fuels. 
If we put the brakes on clean energy research, development, and 
deployment, we risk falling behind countries like China that 
are prioritizing clean energy investments that are spurring new 
industries and creating jobs and this is not a way to grow and 
expand our economy, in my opinion.
    I am also very concerned about the budget cuts to 
efficiency programs. My frustration is compounded by the fact 
that this administration has been slow-walking the publication 
of four product efficiency standards that were completed over a 
year ago. I simply do not understand why you would block the 
completion of these standards which are cost effective and will 
save consumers money. The standards have also been fully 
negotiated. The U.S. District Court has ordered DOE to finally 
publish these standards, but the Trump administration is 
currently wasting taxpayer money to appeal the order. The law 
requires the DOE to publish these standards and it should be 
done immediately.
    The budget proposal also makes several misguided changes to 
the structure of the power marketing administrations, PMAs. It 
directs the Federal Government to sell off a large portion of 
the transmission system in several PMAs; it also requires the 
PMAs to charge consumers for electricity based on the rates of 
comparable private utilities instead of simply recouping costs. 
And both of these actions, I think, are ill-conceived and will 
lead to higher electricity bills for those who purchase 
electricity from a PMA and that is clearly bad for consumers.
    Another proposal I find especially foolish is the 
President's plan to abolish the Northeast Gasoline Supply 
Reserve which was launched after several gasoline shortages 
during Superstorm Sandy. The administration's reasoning for 
this shortsighted proposal that the reserve, and I quote, has 
not been utilized since its establishment. By that logic, we 
might as well discard the Federal Government's stockpile of 
smallpox vaccines because the vaccines have not been used since 
the stockpile was created. And I have introduced legislation to 
authorize the reserve. I would prefer to work with you, Mr. 
Secretary, to perfect and move that legislation, but I 
certainly will fight any attempt to eliminate the reserve.
    And, finally, I must address the recent request the 
Department received from FirstEnergy and Murray Energy to use 
section 202(c) of the Federal Power Act to keep the companies' 
cash-strapped coal and nuclear plants operational. Mr. 
Secretary, judging by your recent statements and those of 
Assistant Secretary Walker, it sounds like you appreciate that 
section 202(c) is for serious grid emergencies as explicitly 
designed in the statute and not designed to bail out power 
plants that are losing money.
    So this request by FirstEnergy, in my opinion, is like 
calling 911 because your credit card got declined. It has 
united Republicans, Democrats, energy companies and 
environmental groups, regulators, and consumers in opposition 
because it is clearly and simply not just inappropriate but, I 
think, illegal.
    So again thank you for testifying before our committee 
today. I know you were here before and, believe me, we 
appreciate the fact that you as a Cabinet member don't hesitate 
to come here. Thank you.
    I yield back, Mr. Chairman.
    Mr. Upton. The gentleman yields back. And I would just echo 
many of the positive comments from both sides of aisle that we 
do appreciate your presence here and your frequent visits to 
Capitol Hill and ability to reach out again to both sides. And, 
Mr. Secretary, you are recognized to give an opening statement 
and then we will proceed with questions.

    STATEMENT OF THE HONORABLE RICK PERRY, SECRETARY, U.S. 
                      DEPARTMENT OF ENERGY

    Secretary Perry. Thank you, Mr. Chairman. And Chairman 
Walden, thank you for your comments. And Ranking Member Rush 
and along to each of you, it is my privilege to be back in 
front of you again. And, Mr. Rush, just as a side comment, I 
hope that we all can reflect a real civility and, frankly, 
brotherly and sisterly love as we go forward in this process. 
And it is my honor to get to serve this country once again in 
this role that I have today and it is a great privilege to be 
interacting with each of you as public servants. You all 
sacrifice to serve this country and I am greatly appreciative 
of that.
    This budget represents a request to the American people 
through their representatives in Congress to fund the 
priorities of this Department. It underscores DOE's commitment 
to stewardship, accountability, service; I hope that our 
interactions with you and other committees of Congress over the 
past year have underscored that commitment. Our DOE leadership 
team has appeared before congressional committees 23 times in 
2017 and we are proud of the strong relationship that we have 
built on the Hill.
    When I first appeared before this committee last year, I 
committed DOE to advancing several key objectives. I noted that 
we needed to accelerate our exascale computing capability; to 
modernize our nuclear arsenal; to continue to address the 
environmental legacy of the Cold War; advance domestic energy 
production; better protect our energy infrastructure. This 
fiscal year 2019 $30.6 billion budget request for the 
Department seeks to advance these and other goals.
    Mr. Chairman, DOE's supercomputing and other advanced 
technology capabilities play a crucial role in combating 
threats to our energy and national security infrastructure. As 
this committee knows from its strong bipartisan support of the 
21st Century Cures legislation, these supercomputing assets are 
also critical to finding cures for cancer, cardiovascular 
disease, and other health challenges.
    In the Precision Medicine Initiative section of the Cures 
Act, section 2011, you encouraged the Secretary of Health and 
Human Services to coordinate with the Secretary of Energy to 
identify and address the technology needs for the initiative. 
So last week I met with HHS Assistant Secretary for Health and 
the Surgeon General to discuss how we can work together to 
address these goals and further utilize our capacity to address 
similar health problems faced by American veterans.
     Mr. McNerney, you and I had talked about this with a 
little more specificity and I hope to be able to come up and 
sit down with you because I know that you have a very real 
interest in this particular area and I just think there is 
extraordinary opportunity here.
    On a parallel track, DOE has been working with the VA to 
utilize information from millions of cancer patients' records 
to determine optimal treatment. We are now bringing these tools 
to bear on veterans' health issues ranging from traumatic brain 
injury to suicide prevention, prostate cancer, cardiovascular 
disease; in addition, we recently announced a major RFP to 
accelerate our efforts to regain American leadership in 
supercomputing. The machines we will build and will deploy will 
be 50 to 100 times faster than any of our current computers and 
will hold immense potential to help to answer the most 
challenging questions in science and medicine and national 
security.
    Regarding national security let me say that the United 
States Government has no greater or more solemn duty than to 
protect its citizens. Because nuclear deterrents are critical 
to our defense, last year we promised a much-needed upgrading 
of our arsenal. This year we requested an 8.3 percent increase 
to align ourselves with the President's Nuclear Posture Review 
and the National Security Strategy. We also focused on 
addressing the environmental legacy left at the Department's 
sites and this year we are requesting additional funds for that 
obligation.
    We also have a duty to advance American energy 
independence. Thanks to ingenuity, innovation, we are on the 
cusp of realizing that objective. In the coming years we will 
produce an abundance of energy from a diverse number of 
sources. Not only are we becoming energy independent, we are 
exporting to our friends, our allies, and our partners. Just 
last year we became a net exporter of natural gas and today we 
are exporting LNG to 27 countries on five different continents.
    And as our economy expanded and the energy development 
reached new heights, our environment became cleaner. From 2005 
to 2017, we led the world in reducing carbon emissions cutting 
them by 14 percent over that time. The lesson is clear, we 
don't have to choose between growing our economy and caring for 
our environment and that is the heart of the new energy realism 
that I recently described.
    To drive further, energy innovations we are requesting 
continued funding for our energy program offices as well as 
more funding for research in fossil fuels and nuclear power 
including small nuclear reactors, the modular reactors. At the 
Department we have a duty to ensure our energy actually 
delivers to its place of use without interruption. Our national 
and economic security depend on a diversity of fuel sources and 
the ability to deliver electricity where and when consumers 
need it.
    My greatest focus as the Secretary of Energy is to ensure 
that our grid is not only reliable but that it is resilient. 
That is why last year I promised to step up our efforts to 
protect and maintain America's energy infrastructure in the 
face of all hazards. The devastation caused by the 2017 
hurricanes highlighted the importance of improving grid 
reliability and resilience in the face of natural disasters. We 
also need to protect it from manmade attacks including cyber 
attacks. So this year we have requested funding increases to 
strengthen cybersecurity as well as the Department's cyber 
defenses. We are also seeking to establish a new Office of 
Cybersecurity, Energy Security, and Emergency Response which 
will be led by a new assistant secretary.
    Now since many of our nation's greatest energy 
breakthroughs have come through the work of our national 
laboratories, we need to ensure their ability to innovate. 
Meeting the people driving our innovation agenda and imploring 
them to reach even higher are some of the reasons I am 
committed to visit each of our national labs. Thus far, I have 
visited 13 of those 17 labs and also visited other key DOE 
sites. At each site one thing was made abundantly clear, those 
who work for the Department are patriots committed to serving 
the American people.
    In the end it will be you, our elected representatives, who 
will decide how to best allocate the resources of our 
hardworking taxpayers. My pledge to you is that we will do our 
best to use those resources wisely and in pursuit of the vital 
goals that I have just outlined. Thank you and it is my 
privilege again to be in front of you and attempt to answer 
your questions.
    [The prepared statement of Secretary Perry follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
    
    Mr. Upton. Well, thank you, Mr. Secretary. At this point we 
will move to questions from both sides. We appreciate again 
your presence here.
    I want to first ask, going back to what Chairman Walden 
said, the great State of Michigan, one of the reasons why it is 
such a great state is because of the Great Lakes. And I would 
like to talk to you briefly about the Straits of Mackinac which 
you know that we both deeply care about. About a week and a 
half ago, we learned that two high voltage transmission cables 
that run under the straits near the Mackinac Bridge were 
destroyed by a ship's anchor and was taken out of service. 
Enbridge's Line 5 which carries not only crude oil, light 
crude, and also propane, also runs under the straits only a 
short distance away, was also struck by that same anchor and 
the pipeline was damaged. It was a near miss. It could have 
been catastrophic for sure.
    And even though the strike on Line 5 did not cause an oil 
spill, that is something we all worry about. Earlier, Governor 
Snyder and I reached an agreement with Enbridge who maintains 
that line to look at a number of options to replace that line. 
In my view, it needs to be directionally drilled in terms of a 
new line that needs to replace the existing line. I know that 
they are looking at a number of different options, and 
particularly with the events of the last 2 weeks it prompts us 
to try and expedite that process even faster.
    A couple questions I have as I work with the governor's 
office and others, can you help us in looking at a replacement 
for this line as it relates to the permitting that would be 
required and other efforts within the administration to replace 
that Line 5 with a safer option than we have today?
    Secretary Perry. Yes. Well, the short answer is yes. But if 
I could just expand a moment, I think it is really important 
for us to recognize that our infrastructure not only in some 
cases as this one, I would suggest, is aging, but also the 
expansion of that infrastructure to be able to take advantage 
of this new energy resource, if you will. Twelve years ago 
there was a fellow traveling around the country making a pretty 
good living giving a speech about peak oil, and the world has 
so changed and America is in such a different position and 
being able to move those resources safely and efficiently is 
really important to the economy and to the national security of 
this country.
    Mr. Upton. Well, you might remember that there was an 
Enbridge pipeline break a number of years ago and when that 
happened we actually passed the Upton-Dingell bill and it 
passed with maybe one vote against it in the Congress. We 
upgraded all of the safety standards and fines for new 
pipelines, and one of the provisions in that bill in fact was 
that any new pipeline built that goes underneath a body, a 
significant body of water, major river, et cetera, certainly 
the Straits of Mackinac, would have to be buried underneath 
that lake or riverbed and not be trenched or simply laid on the 
top.
    So what I have been pushing Enbridge to do, and I know the 
governor is on board as well, is to actually go underneath and 
use that technology that is available today so that we can get 
this thing replaced. One other question relating to that, can 
you ask your department of energy and reliability to actually 
study what would happen if this line went out for some type of 
duration? It leads to a major refinery over in Detroit and then 
that oil is refined and wholesaled throughout the Midwest. And 
I would like to know what the impact might be particularly on 
the consumers, and if you could help us get that, that would be 
good.
    Secretary Perry. I would be happy to do that, Mr. Chairman. 
Your common, or let me put it this way, I think our common 
sense, collectively, tells us that if we lose a major line to a 
refinery like that, that it is going to have a negative impact 
not only on the consuming public, but also I will suggest, and 
it is one of the things I think you are very wise to ask us to 
take a look at this, on the national security side of it.
    I don't know where that fuel goes in its final stages, but 
you all have major military bases in that part of the country 
and it could have a negative impact on their ability to have 
fuel available for the security of this nation.
    Mr. Upton. The last question I have is while we are talking 
about pipeline safety I want to turn to the recent news 
regarding cyber attacks on pipelines and as you know that there 
was a published report just in the last week or two as to a 
cyber attack on one of our pipelines here. I know that that is 
almost a daily occurrence.
    Why is it so important that DOE take a strong role in 
coordinating the federal response? You may know that I have a 
bill, H.R. 5175, the Pipeline and LNG Facility Cybersecurity 
Preparedness Act, which would enhance DOE's ability to 
coordinate pipeline security and emergency response. Can you 
work with us as we move that bill forward?
    Secretary Perry. Yes, sir. Obviously, the world has really 
changed from the standpoint of, and it is not just a few times. 
It is thousands of times a day that there are bad actors out 
there whether they are nation states or whether they are just a 
single individual with ill intent in mind that are trying to 
penetrate into systems all across this country, some of them 
that could have catastrophic impact on our ability to deliver 
energy.
    It is the reason that we have asked for these additional 
funds to stand up this office that we refer to as CESER or 
Cybersecurity. I want to thank Joe Barton for the work that he 
has done on reorg to help us from the standpoint of modernizing 
the agency to look at the changes that have just happened, 
let's say, in the last decade in this country relative to the 
new energy resources we have available, the infrastructure that 
we are going to need, and the security and resiliency of that 
infrastructure, obviously including the grid that is out there.
    Mr. Upton. Thank you much. I would yield to the ranking 
member, Mr. Rush.
    Mr. Rush. Well, thank you, Mr. Chairman. Mr. Secretary, 
again I want to thank you for agreeing to meet with me in the 
near future to discuss ways that we can ensure that the 
Department of Energy reflects the nation's diversity not only 
within the mid-level staff levels, but also within the highest 
levels of the decision making process and positions. With your 
help, Mr. Secretary, I want to ensure that we have diverse 
perspectives structurally in the most critical areas, and these 
areas include within your office, the Institutional Review 
Board, the Energy Advisory Board, the Senior Executive Service, 
now, and of course at the highest levels of the national labs.
    That said, Mr. Secretary, what is the justification for 
cutting the Office or Energy Efficiency and Renewable Energy by 
70 percent from fiscal year 2018 levels? As you know, energy 
efficiency is one of the few issue items that enjoys widespread 
bipartisan support here in the Congress. Initiatives like the 
Weatherization Assistance Program are extremely popular not 
only with policymakers here, but really all across the country 
as it helps to conserve energy while also lowering utility 
bills for low-income families. Why is the administration 
proposing to cut or completely eliminate these critical 
programs?
    Secretary Perry. Mr. Chairman, Ranking Member, thank you. 
Let me address, you asked two questions. On the focus on 
minorities and minorities at the DOE, I think we are focused on 
that. Twenty seven percent of our entire enterprise is made up 
by minorities. I think it is really important to bring to the 
committee's attention that we also have a focus on small 
business contracting at the laboratories so that women-owned 
and minority-owned businesses have the expertise to be able to 
make their way through the myriad contracting issues that are 
there.
    One of the other things I am really proud of is that we 
have a program at the DOE to promote diversity in the STEM area 
back in both high schools and colleges to be able to get young 
diverse members of our society pointed in the right direction, 
engineering, math, science, technology, those, and I am really 
proud of what DOE is doing in that line. And I want to come and 
sit down with you in your office and talk more about this and 
the ways that we can do better.
    Let me shift over to the EERE and to your concerns. And I 
heard Mr. Pallone's concerns as well dealing with EERE and the 
reductions there and I want to try to explain them in this way 
and then have one comment at the end of that. One of the things 
that we have seen is that as technology has become more mature, 
for instance, both solar and wind, and I try to remind folks 
that while I was the Governor of Texas we produced more wind 
energy than any other state in the Nation, passed up every 
state in the country and produced more wind energy than five 
countries and I am committed to having that diverse portfolio, 
but those are now becoming mature in the sense of their market, 
marketability and going to the market and being commercialized.
    So the dollars that have historically been spent to bring 
those up to the place where they can be mature, we don't feel 
like those dollars need to be expended now. Are there other 
areas that we need to be focused on and yes, grid integration 
is a great example of it, energy storage, kind of beyond 
batteries, if you will. Another DOE area that we are focusing 
on is in hydrogen R&D. Those are early stage and that is where 
you are going to see us focused with the dollars.
    So, we will always have a give-and-take back-and-forth 
about are you spending enough here, are you spending enough 
there, and I respect that. As a former appropriator, as a 
former agency head, and then as a CEO as the governor, I really 
respect the authorizers, the appropriators, and the 
administrative or the executive side of this. I know what my 
job is, and my job is to work with you, which I will do on a 
daily basis to find that appropriate ground. But I will promise 
you this that where you appropriate and where you authorize we 
will work to make you very proud that we manage it absolutely 
the most efficient way that it can be.
    Mr. Rush. I yield back, Mr. Chair.
    Mr. Upton. The chair would recognize the gentleman from 
Oregon, a good state, Mr. Walden.
    Mr. Walden. We are a good state now, thanks. Thank you, Mr. 
Chairman. And, Mr. Secretary, again thank you for being here. 
Before I say anything we should also draw attention to the fact 
it is Mr. Walberg's birthday today so happy birthday--from 
Michigan, the great State of Michigan.
    Mr. Secretary, I want to start by talking about Bonneville 
Power Administration. I appreciate your most recent comments 
about respecting the will of the authorizers, which is what we 
are. So along those lines, this idea of selling off the 
electric transmission assets and abandoning cost-based rates 
proposal has been roundly rejected by virtually every member of 
the Pacific Northwest congressional delegation. It is the one 
idea--bad idea--that unites all of us in the Northwest. I am 
afraid this move could do nothing but harm my constituents, 
drive up electricity costs, hurt consumers across the region; 
so can you assure me the DOE will leave Bonneville alone unless 
Congress provides explicit authorization--that authorization 
word again there, Mr. Secretary.
    Secretary Perry. Yes, sir.
    Mr. Walden. Thank you. Now moving along, as you know the 
Hanford Site is just across the river from many of my 
constituents. And not only are safe and secure operations a 
concern, and I appreciate your commitment not only to that and 
the lab nearby but also the help to do the cleanup here, the 
Committee right now is working with the GAO to identify some 
options for improving operational performance. Will you work 
with us on this as we develop findings?
    Secretary Perry. Yes, sir.
    Mr. Walden. Thank you. Let me ask a broader question. As we 
look at modernizing the Department we are focusing on emergency 
and security issues, but also how the Department can better 
expend its limited resources. We are also cognizant of the 
Department's vast technological capabilities which can help 
accelerate innovation across national security, energy, 
manufacturing, even medicine as you have referenced in your 
testimony, but we also have to watch our taxpayers' wallets. 
Can you speak to your support of DOE's science, technology, 
computing facilities and how best to enable innovation in the 
private sector while tentatively managing limited taxpayer 
resources?
    How are you going to balance all that because your labs are 
doing amazing work. It is phenomenal. And for our committee 
members, if you haven't interacted with these labs we should 
figure out a way to do that and get some briefings. It is 
really terrific, the work that is being done there. So, Mr. 
Secretary, what can you tell us about how to balance all that 
and where you are headed in terms of the direction of the labs 
and, yes.
    Secretary Perry. Technology transfer is, I think, one of 
the real goals of this agency from the standpoint of working 
with the labs and we are consolidating the EERE's tech-to-
market functions over in the Office of Technology Transfer. And 
just as a bit of a background I have a fairly substantial 
amount of experience with that. We created some programs while 
I was the Governor of Texas, the Emerging Technology Fund which 
basically is taking a very, very early stage technology and 
getting it to the market.
    So I have had some experience of dealing with that as the 
Governor of Texas which, I am not going to say this is apples-
to-apples, but the point is we have in place the Office of 
Technology Transfer and it is looking at how to coordinate best 
practices across the complex and to, whether it is agreement 
provisions and abilities to consider equities and licensing, 
there is a host of areas.
    And I don't want to drill down all that deep, but the point 
is we are sensitive to one of our goals in a limited budget 
situation is to be able to help these technologies get to 
maturation, if you will, or at least to the point where they 
are ready to be commercialized in the private sector.
    Mr. Walden. All right, good. And in conclusion for my few 
minutes here, this work on reorganizing and modernizing the 
structure of your agency is something that I take seriously. It 
is a goal for our committee and I know Mr. Barton is leading 
that effort and working with Mr. Rush and others to get that 
done.
    So we take it seriously here, we want you to know that. We 
look forward to a partnership to look at how to reauthorize and 
modernize the agency. Our committee has a pretty good track 
record looking at other agencies, and like the FCC we 
reauthorized for the first time since 1990, your agency is one 
that goes back before that. And so we look forward to 
continuing to work with you on that effort and so we want to 
move forward.
    I will thank the chairman for this hearing and return the 
balance of my time.
    Mr. Upton. The gentleman yields back. The chair recognizes 
the gentleman from New Jersey, Mr. Pallone.
    Mr. Pallone. Thank you, Mr. Chairman. Mr. Secretary, how 
many LNG export applications to Non-Free Trade Agreement 
countries are currently pending before the DOE, if you will?
    Secretary Perry. There is 19, correct? I think there is 19.
    Mr. Pallone. Do you believe that----
    Secretary Perry. Let me, I will get you the----
    Mr. Pallone. Yes. I will accept that. And if you want to 
get back to me if you think it is slightly wrong, please do. Do 
you believe that the DOE should continue to have a role in 
approving the LNG export applications, yes or no?
    Secretary Perry. Yes, sir.
    Mr. Pallone. And does the EPA, now I am talking about the 
EPA, does the EPA play any role in DOE's public interest 
determination process, yes or no?
    Secretary Perry. I am sure they do, but I am no expert on 
how the EPA functions, sir.
    Mr. Pallone. OK. Well, whether or not you agree that the 
U.S. Government should be promoting exports of American LNG 
that is an activity that would clearly fall within the mission 
of your Department or maybe the Department of Commerce. But as 
you know, I think late last year EPA Administrator Scott Pruitt 
traveled to Morocco to pitch that country on buying LNG from 
the U.S. Obviously I am very concerned that that doesn't fall 
within the EPA's mission. Do you think that this falls within 
EPA's mission?
    Secretary Perry. Mr. Pallone, I am going to leave that up 
to you. I try to stay in my lane as best I can. So again as I 
shared with you, I don't know what EPA's statutory 
responsibility and authorizations are relative to promoting 
energy sales and/or what else might have been going on that I 
don't know about on that trip. So I think it would be a little 
inappropriate for me to be making a public or private 
observation about that.
    Mr. Pallone. All right. Well, let me just ask. I think I 
know your answer, but did you or your Department have any role 
in Mr. Pruitt's Morocco trip?
    Secretary Perry. Again there may have been some staff-to-
staff level conversations that I am not privy to, but from the 
standpoint of Secretary-to-Secretary I don't recall any 
conversations relative to an EPA trip to Morocco.
    Mr. Pallone. All right, thank you. I just wanted to point 
out that when Administrator Pruitt testified before this 
committee late last year he used the phrase ``core mission'' 
many times and argued that he was working to take EPA back to 
focusing on its basic responsibilities. And I found it strange 
that Administrator Pruitt thinks that visiting foreign 
countries to promote the sale of fossil fuels from private 
companies falls within the EPA's core mission. I don't think it 
does.
    But let me ask you a second question, Mr. Secretary. I note 
that the Department has established a web page and email 
address to accept public comments and requests regarding 
emergency must-run orders under the Federal Power Act, section 
202(c). And I am supportive of efforts to expand public 
participation in government processes, however, I don't see 
anything on that web page that indicates that these comments, 
whether as-is or redacted, will be posted for the public to 
see.
    If you want me to repeat this I will, but I am basically 
trying to get a commitment from you to posting the comments you 
receive on your website or at the very least providing this 
committee in real time the comments you received on this matter 
for all of us here to review. Is that something you can commit 
to?
    Secretary Perry. Yes, sir. And I think we have a place for 
public comments because this 202(c) is just now being analyzed 
and I don't think we even have a process in place yet for the 
public----
    Mr. Pallone. You do have on the website a page and email 
address to accept public comments and requests regarding the 
Federal Power Act section 202, but I just want to make sure 
that they will be posted for the public to see. That is what I 
am asking.
    Secretary Perry. Yes, sir. We will.
    Mr. Pallone. All right, thank you so much. I yield back.
    Mr. Upton. The chair recognizes the vice chair of the 
Energy Subcommittee, the gentleman from Texas, the good State 
of Texas. Oh, Mr. Barton, I am sorry. Mr. Barton, I recognize 
Mr. Barton, the vice chair of the full committee.
    Mr. Barton. All right. Well, you sometimes are too many 
Texans, right?
    Mr. Upton. Mr. Barton, whose picture is right above you on 
the right, is recognized for 5 minutes.
    Mr. Barton. As Mr. Upton's is right up there.
    First of all, welcome, Mr. Secretary.
    Secretary Perry. Yes, sir.
    Mr. Barton. I think you and I should acknowledge at the 
beginning that our basketball team got hammered by Mr. Upton's 
team in the Sweet 16.
    Mr. Upton. One point.
    Mr. Barton. One, we got beat 27 points. My lord, they put 
it to us. So I know I can't speak for Secretary Perry, but I 
wasn't real happy that afternoon.
    Mr. Upton. Thinking about Houston that was the three-
pointer there.
    Mr. Barton. Yes, the game before you barely won, you put 
the wood to us. Anyway, we are glad to have you, Mr. Secretary.
    Secretary Perry. Yes, sir.
    Mr. Barton. I am tempted to go down the rabbit hole that 
Mr. Pallone introduced about your colleague at the EPA, but I 
don't think so. I will say on my own behalf that any Cabinet 
Secretary that encourages things that are of strategic interest 
to the United States of America in his overseas travels is not 
necessarily a bad thing. And I am glad to learn that Mr. 
Pallone agrees that there are limits to what EPA should be 
involved with. So in that sense it was a good exchange.
    I want to ask a few budget questions, but I am going to ask 
one policy question. You probably can't read this. This is 
today's business section of the Wall Street Journal. It says 
oil hits highest price since 2014. I am sure you read that 
before you came up here. And inside it has another article 
about Treasury bonds are beginning to inch up and tension in 
the marketplace over that.
    What, if anything, should the Department of Energy under 
your stewardship do with the Strategic Petroleum Reserve to try 
to, I am not going to say manage the market, but make sure oil 
prices don't go too high in the near term, if anything?
     Secretary Perry. Well, Mr. Chairman, I think one of the 
things that DOE needs to do and can do from the standpoint of 
making sure that there is a ready supply of energy, whether it 
is renewables, whether it is hydro, whether it is nuclear, 
whether it is coal, whether it is natural gas, the Strategic 
Petroleum Reserve, I think you bring up a really interesting 
opportunity for this body and for Congress and the 
administration to have, and obviously the public to have an 
open conversation about is the SPRO the way that it is 
structured today the proper structure? Is there enough, too 
much? Is the operation of it on a yearly basis, the cost of the 
upkeep of that in our best interest?
    I will leave that to all of us, collectively, to have that 
conversation. But it was put in place after World War II and 
there may be, and after the shortage of the '70s when we saw 
the need for that really exploding, if you will. And I think 
the question now is that with the resources that the United 
States has with the new innovation, with the new energy 
portfolio that we have, does the Strategic Petroleum Reserve 
need to stay in its current form? I am not ready to sit here 
and tell you I know the answer to that, but I think it is 
important the issue that you brought up that we need to have 
that conversation.
    Mr. Barton. The GAO has done a study of the Strategic 
Petroleum Reserve and it basically says we need to do more 
study. You and I are going to meet next week and I think we are 
also going to have the staff begin to meet also with our 
friends on the minority side and that will be something that we 
bring up.
    I have a few quick just dollar questions since this is----
    Secretary Perry. I will try to give you yes or no answers, 
sir.
    Mr. Barton. Yes. Do you support us funding Yucca Mountain, 
us, the government, funding Yucca Mountain? I hope you say yes.
    Secretary Perry. The dollars that you all are going to 
appropriate we will spend efficiently and appropriately, yes.
    Mr. Barton. OK, finally. We have a Northeast Home Heating 
Oil Reserve that I put into a bill with Congressman Markey back 
in, oh, about 10 years ago. We spend $10 million a year on it. 
It has never been used. Is that maybe something we could save a 
little money on?
    Secretary Perry. Well, certainly, when you have dollars 
sitting in an account that is not being used it is----
    Mr. Barton. Something to look at.
    Secretary Perry. Yes.
    Mr. Barton. OK. And you have $159 million in your budget 
for something called Legacy Management. Do you happen to know 
what that is?
    Secretary Perry. Yes, sir. Those are areas that older 
facilities that, on the cleanup side that is over in EM.
    Mr. Barton. I am very proud that you knew what it was.
    Secretary Perry. Yes, sir. The Cold War cost a lot of money 
as did the Manhattan Project. Still costing us a lot of money 
but it was worth it, sir.
    Mr. Barton. Let's see if we can save some money there.
    Thank you, Mr. Chairman. And thank you, Mr. Secretary.
    Mr. Upton. The gentleman's time is expired.
    The gentleman from California, Mr. McNerney.
    Mr. McNerney. I thank the chairman.
    Mr. Secretary, I really appreciate your interest in 
veterans issues and particularly using science and computing 
power to make advances in PTSD and traumatic brain injuries and 
other veteran-centric issues and I look forward to any 
collaboration----
    Secretary Perry. Yes, sir.
    Mr. McNerney [continuing]. Between us in the future. There 
is two issues I want to bring up today. One is resiliency of 
the electric grid, especially in the face of the wildfires we 
had in California, and other threats that we are seeing and 
ARPA-E funding. Regarding resilience, does the DOE have any 
tools to help ensure resilience despite some of the gaps we 
have in our current law? Are there any tools that we can use 
that you can use to help us make our grid more resilient to 
these things in California and elsewhere?
    Secretary Perry. Obviously the test grid, if you will, at 
Idaho National Lab is one of the resources that we have 
available where we can literally go in and break that grid and 
to see what happens and how to address it.
    Mr. McNerney. Well, what I am really thinking about is 
Federal tools to work between the DOI and the Forest Service to 
ensure rights of way so that brush can be cleared in Federal 
lands, those kind of things.
    Secretary Perry. I am sorry. I was going down a different 
path here.
    Mr. McNerney. Sure.
    Secretary Perry. Let me get back to you. I don't off the 
top of my head know that we have any resources available for 
that specific----
    Mr. McNerney. Or authorities.
    Secretary Perry. Or authority, yes, sir.
    Mr. McNerney. Thank you.
    Secretary Perry. But I will get back to you.
    Mr. McNerney. Well, the current budget proposal reduces 
funding for resilience and reliability from $89 billion in 2017 
to $61 billion in 2019. And we have seen an increase in some of 
these threats, wildfires, hurricanes, storms and so on, so that 
budget direction seems to be going the wrong way. I think we 
need increase in that so that is a point of recommendations.
    Secretary Perry. Yes, sir. Mr. McNerney, I don't want to 
quibble with you about the issue of is it a reduction of 
dollars or, one of the things that we have done, I believe, in 
that particular line item is that we bifurcated it. And that is 
where cybersecurity, and we split that historic line item up 
and are creating this new office of cybersecurity emergency 
response and that has an 8.3 percent, yes sir, I think that is 
right. It has a substantial increase over on that side and you 
may be seeing the EERE budget that is lower.
    But the commitment to resiliency and to reliability from my 
perspective has actually increased. And so let me come over and 
sit down with you and we can look at this a little closer to 
make sure that--I know what you want to do and I want to get to 
the same place that you are. I think the membership wants to 
get from the standpoint of making sure that we have the 
resiliency, the reliability in our grid.
    Mr. McNerney. And of course then that applies to the whole 
country not just to California.
    Secretary Perry. Yes, sir.
    Mr. McNerney. Regarding ARPA-E, this program is designed to 
help keep the United States at the forefront of energy 
innovation. Energy innovation, I think that is a key element in 
ensuring our strong market position on energy issues. How 
determined is the administration in eliminating this program?
    Secretary Perry. It shows up on the budget. I am a good 
enough historian to understand that we are going to do what the 
Congress wants to do on this. As a former CEO of the State of 
Texas I put some budgets forward from time to time that 
actually had zero line items in them. And----
    Mr. McNerney. That is kind of the same answer you gave 6 
months ago so.
    Secretary Perry. Yes, sir. And that was not particularly 
well received by the appropriators.
    Mr. McNerney. OK. Mr. Secretary, do you support robust 
funding for fusion energy research and development?
    Secretary Perry. Yes, sir.
    Mr. McNerney. Thank you. Your predecessor was deeply 
involved in the negotiations for the Iran nuclear agreement. 
This administration has considered scrapping that agreement. 
Are you involved in those deliberations?
    Secretary Perry. Well, being on the National Security 
Council, yes, sir, to some degree. I would not put myself as 
the lead negotiator, but certainly am involved with the 
conversations generally in rooms that we can't be having 
conversations with here.
    Mr. McNerney. Can you disclose your opinion on that?
    Secretary Perry. Well, I think like any of our deals 
whether it is NAFTA, whether it is JCPOA, whether it is the 
negotiations that are ongoing with Saudi Arabia for a civil 
nuclear agreement, we need to get the best agreement that we 
can get. I think one of our main responsibilities is to, in the 
nonproliferation area is to make sure that the fewer 
individuals who have access to those types of materials that 
can be made into weapons we need to restrict that so.
    Mr. McNerney. The agreement is already in place.
    Secretary Perry. I understand that, but so is NAFTA and we 
are renegotiating NAFTA. So I think the administration's point 
is can we re-engage and get a better deal. I don't have a 
problem in the world with that no matter what it might be, 
whether it is NAFTA, whether it is JCPOA. We have people 
renegotiating LNG deals that they signed 3 years ago.
    Mr. McNerney. I think the chairman is going to cut us off 
here so thank you.
    Secretary Perry. I know. Yes, sir. Thank you.
    Mr. McNerney. Thank you, Mr. Secretary.
    Mr. Upton. The chair recognizes now the vice chair of the 
powerful Energy Subcommittee, Mr. Olson, from the great State 
of Texas.
    Mr. Olson. I thank the chair.
    And, Secretary Perry, a big old Texas howdy.
    Secretary Perry. Howdy.
    Mr. Olson. It is great to have you back before the panel. 
As a personal note, I am glad you did not leave DOE for VA as 
was rumored. Houston Texans are happy to have your hat hang 
where it is hanging today.
    Secretary Perry. Yes, sir.
    Mr. Olson. I want to talk about section 202(c) of the 
Federal Power Act. I was one of the members of last Congress to 
lead an effort to amend section 202(c). That change was signed 
into law. The intent was limited. Talking about ``continuance 
of war'' or a ``sudden increase in demand for electric energy, 
or a shortage of electric energy,'' there have been proposals 
to help failing coal and nuclear plants through section 202(c). 
I support coal and nuclear power and I believe we have to have 
a diverse grid. Hurricane Harvey showed that dramatically.
    In my district, as you know, NRG's Parish power plant has 
four coal generators and four natural gas generators. Fifty 
inches of rain or more wiped out that coal, made it wet. They 
ramped up natural gas production at that facility. Forty miles 
south is the South Texas Nuclear power plant in Bay City. That 
never had a flicker despite having the brunt of Harvey's force. 
Could you please talk about your view of section 202(c) and the 
powers it gives you?
    Secretary Perry. Yes, sir. And if I may, I would like to go 
back and just if I could very quickly clarify a conversation 
with Mr. Pallone where we talked about the email address on the 
202(c) comments. And we have an address that is on our website 
that is the destination for correspondence for this and future 
applications. So it is not a formal comment period because 
there has been no formal comment opened up so I just wanted to 
clarify that.
    The 202(c) is in place and I think you did a very good job, 
Mr. Olson, of basically laying out why a 202(c) could be used 
in this case. When we look at national security in particular, 
if you are in New York City and Wall Street were to lose power, 
I think anyone would say that puts our national security in 
jeopardy. We have military bases in a lot of different places 
around the country that rely upon their energy from the grid. 
Losing power to that grid would put our national security at 
risk.
    So this administration looks at the national grid and the 
resiliency of it as well as the reliability of it as a national 
security issue. Having a very broad portfolio of renewables, of 
natural gas, of coal, of nuclear, of hydro, those are, we 
think, instrumental in being able to send the message across 
this country that whether it is in your private life or whether 
it is in your public life and I am talking about national 
security at that particular point in time versus why should 
anyone be put in the situation of having to choose between 
turning the lights on and keeping my family warm.
    And this administration believes strongly that if we don't 
have a diverse portfolio and to try to keep these plants online 
obviously doing it with as much sensitivity as we can to the 
environment, and again in my opening remarks I made a comment 
that with 14 percent decrease in carbon emissions in this 
country that is leading the world. So the innovation and the 
technology that we have coming out of this country, but it is 
imperative that we don't allow political decisions to be made 
relative to our electrical, or excuse me, our power security in 
this country.
    Mr. Olson. Yes, sir. One further question on India, I went 
there last week on a mission to talk about LNG being exported 
to the great nation of India and they were gushing, guess who 
is coming this week or the next couple days, Secretary Rick 
Perry. You get there and find out that Prime Minister Modi has 
a very aggressive plan to clean up their extremely dirty air 
and that is with renewables, mostly wind and solar.
    But the energy minister and their foreign secretary stated 
over and over that LNG natural gas is the economy of the now. 
The future is renewables. As you know, we have had a private 
contract between Cheniere and a company, a group called GAIL, 
there in India to export approximately seven metric tons of 
liquefied natural gas over the next 20 years. We agree that to 
make this viable and to make that transition they want to make 
they have to have better battery power, better storage and 
better power lines, and also make wind viable. So I want you to 
take that technology message to them. We are going to help you. 
And so any comments about your trip to India?
    Secretary Perry. Yes, sir. Two weeks ago, the first 
molecules of U.S. natural gas arrived at GAIL. I think the 
issue for them is to build out their infrastructure to be able 
to move that gas around. Not unlike, Mr. Chairman, what we have 
in this country. Yes, we are way ahead of them, but the point 
is if you are really going to be able to satisfy the economic 
needs and satisfy the national security needs of your people 
you are going to have to have the distribution system as well.
    So that is another area. U.S. pipeline technology, U.S. 
pipeline companies, I think there is a real opportunity in not 
just India, but India is obviously a huge market in our ability 
to deliver U.S. innovation, U.S. natural resources into that 
country are a great opportunity and that is the real driving 
factor of why we are headed that way.
    Mr. Olson. Namaste. I yield back.
    Mr. Upton. The chair recognizes the gentleman from 
California, Mr. Peters.
    Mr. Peters. Thank you, Mr. Chairman.
    And I thank you, Mr. Secretary, for being here. I have the 
exact quote I will just read to you. When I asked you about the 
budget that was proposed by the President you said I didn't 
write this budget, my job is to defend it which from time to 
time is counter to what I think is good. So I know you are here 
to do a job, but maybe we can----
    Secretary Perry. Yes, sir.
    Mr. Peters [continuing]. Get some of your personal opinions 
on this. The budget makes cuts to the Office of Science which 
includes an important project named the International Thermal 
Nuclear Experimental Reactor which is sometimes referred to as 
ITER. Here is a program where the United States is one in an 
international partnership developing energy of the future by 
proving we can make fusion work. The U.S. contributes 9 percent 
of the project funding, but 80 percent of it is spent in the 
United States and we have access to one hundred percent of the 
intellectual property. And perhaps most important, when the 
technology is proven we can be part of the group that has 
ownership with monetizing capabilities instead of being a 
country that has to buy into the group.
    So with all these benefits, why does the budget cut 
contributions to ITER?
    Secretary Perry. Mr. Peters, I think the basic messaging 
here on the reduction in that line item was, this is my 
observation just being a manager and having been in 
negotiations before, it was really poorly managed. And I think 
you know that. You all have been briefed on it. The previous 
management of ITER was very, very poor. They wasted a lot of 
money.
    And they have new management in there. Mr. Bigot came over 
and we sat down and discussed this. I was impressed with his 
focus, his understanding, his recognition of the poor 
management before. We have as a matter of fact out of your 
district a couple of projects that are being funded, the 
Solenoid, $75 million, and I think another aspect of the 
project that is ongoing that General Atomics is the deliverer, 
the manufacturer of, and we certainly support that and are 
funding that.
    But with that said, if this committee and if Congress in a 
whole get comfortable along with obviously the administration, 
that it is headed in the right direction, we will make sure 
that the U.S. dollars that are expended there are expended 
properly and that there is good oversight and that we have the 
proper outcomes that we would be looking for.
    Mr. Peters. I appreciate the comment about the management. 
That is fair. Now that we have improved that, I certainly hope 
we appreciate the leverage that we get out of this potential.
    Secretary Perry. Yes, sir. Thank you.
    Mr. Peters. And so just outside my district, San Diego Gas 
& Electric built and it runs the largest lithium ion battery in 
the world as part of its grid operations. It is proving that 
projects like this can be a valuable part of the grid 
particularly for resiliency and safety. How does the DOE budget 
ensure new technologies for grid resiliency can be implemented 
and tested properly?
    Secretary Perry. And that goes right to the heart of our 
both Office of Science, Paul Dabbar, who is now the assistant 
secretary there I have great faith in his focus, and 
particularly we are supporters of, I have said before, the 
battery storage, the holy grail of electric power. I believe 
that. DOE and DOE labs working with private sector 
organizations like your constituents or right outside of your 
district are going to be key to that. So I am confident that 
what is happening in our national labs, the funding of those is 
appropriate to meet the needs of the battery challenges that 
face us.
    Mr. Peters. Thank you. And just with respect to NAFTA, do 
you think that the disruption of NAFTA will have a negative 
impact on energy prices for Americans and supplies for U.S. 
energy companies who sell to Mexico and Canada, even the way we 
talk about it right now?
    Secretary Perry. Not necessarily. I think generally 
speaking people are able to divorce the rhetoric with reality. 
For instance, Ray Washburne, who is the head of OPIC, he and I 
have had conversations with my counterpart in Mexico and 
private sector operators in the U.S. and their Mexican counter 
partners, if you will, to invest in Mexico's energy 
infrastructure. So I feel confident. I think there is an 
extraordinary opportunity there.
    Mr. Peters. I am going to run out of time. I appreciate 
what you say about rhetoric. I have got to tell you that NAFTA 
is so important----
    Secretary Perry. Yes, sir.
    Mr. Peters [continuing]. To our country and to my district 
in particular and I understand the talk about improving it. I 
think we had more leverage when we were dealing with 11 other 
countries. We could offer more to Mexico. But I certainly don't 
want to go backwards and some of the talk is, it looks like 
rhetoric is turning into policy and it concerns me. I just want 
to express that to you.
    Secretary Perry. Mr. Peters, just as an aside, every time I 
see Ambassador Lighthizer I tell him we have got to get a deal. 
Get a good deal, but we have got to get a deal.
    Mr. Upton. Mr. Latta?
    Mr. Latta. Thank you, Mr. Chairman. And, Mr. Secretary, 
thanks very much for being with us again today. I really 
appreciate seeing you. And I think it is really important, 
because also in reading your testimony about cybersecurity it 
is a big issue and in recent weeks we have read news stories 
about malicious agents working to undermine the safety and 
security of our nation's energy infrastructure. According to 
the Department of Homeland Security, this includes Russian 
cyber attacks that have remotely targeted the power grid, 
energy, nuclear, and commercial facilities in critical 
manufacturing sectors. More recently, we have seen cyber 
attacks against the electronic communication systems of several 
American pipeline companies. DHS is still working to determine 
who is responsible for these specific attacks.
    And I believe from your response from the chairman of the 
subcommittee, the gentleman from Michigan, that you would agree 
that more needs to be done to address these attacks on our 
energy infrastructure. Is DOE working with DHS to identify the 
vulnerabilities that were exploited through these attacks and 
rectifying them and, if so, can you tell us what might be done 
and what is being done?
    Secretary Perry. Well, there is nothing more essential to 
America's national interest and for that matter our national 
security than our energy supply. The Department of Energy plays 
a very important role with that. We are the specific agency 
that deals with the energy side of particularly grid security, 
but we are also working with the other sectors, or not the 
other sectors but the other agencies as well, DHS, Department 
of Transportation, and DHS and Transportation Department leads 
cybersecurity support to pipelines. DOE works closely with them 
and other departments and we have some other stakeholders to 
protect the energy sector including the secure transport of our 
oil and gas. So we recognize the real challenges there.
    One of the reasons that we are asking for the additional 
dollars to stand up this office of cybersecurity that we refer 
to as CESER, C-E-S-E-R, is so that we can focus the resources, 
use our national labs, working with these other agencies of 
government, to assure the American people that we have done 
everything within reason possible to protect the American 
people from these cyber attacks that are only increasing in 
intensity and frequency.
    Mr. Latta. Thank you. Given the nature of these threats, I 
believe it is more important than ever that Congress acts. That 
is why I have worked with my colleague, Representative 
McNerney, to introduce two bipartisan pieces of legislation to 
address the threat of cyber attacks. These two bills, H.R. 
5239, the Cyber Sense Act, and H.R. 5240, the Enhancing Grid 
Security Through Public-Private Partnerships Act, was the 
subject of a legislative hearing held in this subcommittee last 
month.
    Under H.R. 5239, the Secretary of Energy would be directed 
to establish a voluntary cyber sense program to identify and 
promote cyber secure products intended for these in the bulk 
power system. And do you believe that this policy would help 
improve the safety and security of our energy infrastructure 
and address these threats?
    Secretary Perry. It certainly on its face sounds like it. 
We will work with you in any way that we can to flesh out any 
details and information that we have privy to.
    Mr. Latta. I really appreciate that. Thank you. And along 
with Representative McNerney, I am also the co-chair of the 
Grid Innovation Caucus here in the House. The purpose of this 
caucus is to discuss the challenges facing the electric grid 
and to come up with ways that we can enhance its capabilities 
and securities. In addition to guarding against the threat of 
cyber attacks, will you go into more detail about other ways in 
which DOE is trying to improve the electric grid's capabilities 
to protect it from these cyber attacks?
    Secretary Perry. Yes, sir. We will work with you in----
    Mr. Latta. Well, I really appreciate it. Thank you very 
much, Mr. Chairman. I yield back the balance of my time.
    Mr. Upton. The gentleman from Pennsylvania is recognized.
    Mr. Doyle. Thank you, Mr. Chairman.
    Mr. Secretary, welcome back.
    Secretary Perry. Mr. Doyle.
    Mr. Doyle. Like many on this panel, I am greatly concerned 
by the premature closures of nuclear plants around this 
country. John Hanger who was former Secretary of the DEP in 
Pennsylvania and head of the Public Utility Commission in my 
state put it succinctly. He said there are now 18 nuclear units 
that have closed or are scheduled for closure in the last 5 
years. Three are in my State of Pennsylvania, Beaver Valley I 
and II, and Three Mile Island. Those three nuclear units 
generated 22 terawatt hours of energy in 2017, all the wind and 
solar in Pennsylvania generated 4 terawatt hours in 2017. This 
is putting my State at the edge of a clean air climate 
disaster.
    Secretary Perry, I echo his concerns and would add that 
these nuclear plants not only provide good family supporting 
jobs, but also affordable, reliable, and greenhouse gas-free 
electricity. I just saw an interesting study that has come out 
by a think tank The Third Way that takes a look at the effect 
of these retirements of the nuclear portfolio and how it 
affects our ability to meet our climate change goals to reduce 
greenhouse gases below, 80 percent below 2005 levels by 2050. 
It would be virtually impossible for us to make that up, 
because as every nuclear plant retires even if we start greatly 
upping our renewables, they would have to make up for that loss 
before we start to add more carbon-free energy to our cycle. So 
I think it is a real problem.
    I know FirstEnergy recently filed this 202(c) request with 
your Department and I saw you quoted as saying that that may 
not be the most appropriate and efficient way to deal with 
this, but it is not the only way. And while I applaud your 
caution on the 202(c) request, I am curious what other options 
you think are on the table. Is this something that can be 
settled at DOE or in Congress or at FERC? What are the other 
ways that this might be dealt with?
    Secretary Perry. Mr. Doyle, let me just say you are 
absolutely correct, very prescient in your observation about 
this country and the ability to deliver the energy needs with 
the premature in particular taking offline of coal and nuclear 
plants. I, like you, share a great concern about our ability to 
stay economically viable, but more importantly from a national 
security standpoint of taking care----
    Mr. Doyle. And an environmental standpoint if we are ever 
going to meet our goals for climate change.
    Secretary Perry. Absolutely. So to address the specific 
question, if you will recall, I want to say 6, 7 months ago, we 
put a 403 request in to the Federal Energy Regulatory 
Commission, to FERC, which we thought was an appropriate way to 
address this. They obviously did not. The 202(c) is an option. 
I would like to work with you and members of Congress on any 
other options that are out there that are reasonable that get 
the result of which we need in the result from my perspective 
is a diverse portfolio. And let me just add, I think it is 
really important for this country to have a nuclear, civil 
nuclear program in place. Too many previous administrations 
made some decisions that from my perspective put particularly 
the nuclear energy industry in jeopardy and we now see the 
results of that whether it was regulations, whether it was not 
supporting them in various----
    Mr. Doyle. Mr. Secretary, I would be happy to work with you 
on ideas to ensure that we keep our nation's leading source of 
carbon-free power online.
    Let me ask you another question. Existing energy markets 
they don't seem to consider the environmental attributes of 
nuclear power, but there are some States like New York and 
Illinois that have implemented strategies focused on ensuring 
that the environmental benefits of nuclear are recognized. 
Other States, including mine in Pennsylvania, are considering 
similar strategies, but I understand that some parties are 
proposing rule changes at PJM that could punish these States by 
making it more difficult for certain plants or units to 
participate in the markets. Do you think that is good policy?
    Secretary Perry. I think any policy that restricts your 
diversity of your energy portfolio is not necessarily good 
policy. I think it is shortsighted.
    Mr. Doyle. I see my time is up. Thank you, Mr. Chairman.
    Mr. Upton. Mr. Shimkus?
    Mr. Shimkus. Thank you. Mr. Secretary, welcome. Since you 
appeared before us, our nation's nuclear waste management has 
passed a few notable anniversaries. December marked the 35th 
anniversary of passage of the Nuclear Waste Policy Act of 1982 
which formalized the Federal Government's nuclear waste 
management program, as well as the 30th anniversary when 
Congress designated Yucca Mountain in Nevada the site as the 
location of our nation's first repository. Of greater 
consequence, January 31st marked the 20th anniversary from the 
year in which DOE was legally required to take title to spent 
nuclear fuel for disposal at Yucca Mountain. Since then 
American taxpayers have been paying billions of dollars to 
manage spent nuclear fuel in 121 communities around the 
country.
    Secretary Perry, I would like to run through a few numbers 
with you quickly, and you probably know some of these and we 
can just kind of stick to the numbers because I have another 
question I want to get to.
    Secretary Perry. Yes, sir.
    Mr. Shimkus. As of the end of fiscal year 2017, what is the 
approximate amount rate payers paid into the Nuclear Waste Fund 
to construct/oversee our nuclear waste management program?
    Secretary Perry. It is approaching $40 billion. I think it 
is about $37, $37.7 billion.
    Mr. Shimkus. And those are rate payers, people from states 
that had nuclear power that have paid in to solve this problem.
    Secretary Perry. That is correct.
    Mr. Shimkus. How much did the value of the Nuclear Waste 
Fund increase during fiscal year 2017?
    Secretary Perry. Almost $2 billion, I think $1.7 billion is 
the specific.
    Mr. Shimkus. That is the accrued interest on the base of 
the account.
    Secretary Perry. Right.
    Mr. Shimkus. As of the end of fiscal year 2017, what is the 
total cumulative liability cost including future payments 
because Yucca Mountain is not yet open?
    Secretary Perry. Just a touch over $34 billion.
    Mr. Shimkus. So that is payments that we are liable for 
because we are not complying with law.
    Secretary Perry. That is correct.
    Mr. Shimkus. And you are saying then the $30-plus billion.
    Secretary Perry. Yes.
    Mr. Shimkus. How much did American taxpayers pay in legal 
costs during the fiscal year 2017 because Yucca Mountain is not 
open?
    Secretary Perry. $700 million.
    Mr. Shimkus. So for my colleagues, we move this bill, this 
an issue I am fighting with appropriators and budgeteers. This 
is money that taxpayers are paying that is really not on the 
books and it accrues to almost $800 million. What was the total 
increase in fiscal year 2017 in taxpayer liability in both 
actual payments as well as future projected liabilities?
    Secretary Perry. That one grew substantially, $3.3 billion.
    Mr. Shimkus. If you break this total cost down to a daily 
cost to taxpayers that escalated during just last year how much 
are taxpayers liable for on a daily basis?
    Secretary Perry. $9 million per day.
    Mr. Shimkus. That is a day. That is money that we could do, 
help our national defense, Title I programs, anything. That is 
just being paid because we are not complying with the law. So 
when people wonder why I get so focused, these are some of the 
reasons why. Last question in this area, how much was provided 
to the Department in fiscal year 2017--and I think I can add 
2018 now--from the Nuclear Waste Fund for DOE to move forward 
with our Nuclear Waste Program and ultimately reduce our 
taxpayers' legal payments?
    That is a zero, I am assuming. Not a one, it is a zero.
    Secretary Perry. That is a zero.
    Mr. Shimkus. OK. And that is our liability as authorizers 
to push our appropriators to do what----
    Secretary Perry. And, I think, Mr. Shimkus, that is the 
reason that the administration requested $110 million for the 
legal process to go forward, to be able to get the answer of 
whether or not this facility is in fact what you all in 
Congress have said it is.
    Mr. Shimkus. Yes. So the appropriation money is really to 
do the final adjudication with the Nuclear Regulatory 
Commission with you as an intervener with the State of Nevada 
to clarify the science. And that is the last part before we can 
then really start moving and addressing this.
    With my 30 seconds left, I won't read the whole question 
but you have talked about the DOE and the great work it does. 
Obviously I am also very much engaged in the renewable fuel 
debate in this country. DOE has done a lot of good work on a 
study, I have quoted it before, the Co-Optima study. Are you 
familiar with it and what is your thoughts on it?
    Secretary Perry. Say it again, sir?
    Mr. Shimkus. The Co-Optima study?
    Secretary Perry. I am not.
    Mr. Shimkus. It is the high octane, it basically is 
addressing the high octane issue. We have a hearing tomorrow.
    Secretary Perry. I will get up to speed on it and get back 
with you and have a conversation.
    Mr. Shimkus. Not a problem, I appreciate your time. Thank 
you.
    Secretary Perry. Yes, sir.
    Mr. Upton. The gentlelady from Florida.
    Ms. Castor. Thank you, Chairman Upton. Good morning, 
Secretary Perry. Yesterday in our Oversight Committee we had 
Bruce Walker, your Assistant Secretary of Electricity Delivery 
and Energy Reliability who gave us an update on restoration of 
the grid in Puerto Rico. And I think everyone was very 
heartened by what he had to say and what the Department is 
doing to build a more resilient grid, a more modern grid, 
tapping the expertise of our national laboratories and working 
with private sector partners and researchers there on the 
ground.
    And now Congress has provided the funds and overridden some 
of the language in the Stafford Act that says you have to just 
rebuild what was there, which if we did that that would not 
protect the taxpayers. So thank you and we will be watching for 
the modeling he said is necessary to do something very 
innovative there.
    But then we get the budget request. And I am very concerned 
about how anti-consumer the administration's budget request is 
by eliminating our weatherization initiatives and energy 
efficiency initiatives that really help put money back in the 
pockets of consumers. This will hurt real people out there in 
the world. And then it is a budget request that sidelines 
science with devastating proposed cuts to clean energy 
research, smart grid R&D, and energy storage.
    And I think in doing this kind of budget request really 
cedes America's leadership and it says to consumers you are 
going to have to pay more. And you know how competitive we are 
out in the world, it just doesn't meet the challenges that we 
currently face with the cost of the changing climate and 
watching the transformation in the energy sector.
    The EIA has said wind, solar, and hydro now account for 18 
percent of the energy generation in America. Solar is the 
fastest growing source of new energy worldwide because of its 
declining cost. And yet, and you have said it yourself in 
testimony energy storage is the Holy Grail and yet what you 
said certainly doesn't match the budget request because 
developments and innovations in energy storage are absolutely 
crucial for modernizing our electric system.
    The U.S. just hit a major milestone. We now have capacity 
to store 1 billion watts of power for an hour and while the 
U.S. is still leading in energy storage development, everyone 
says China is likely to pass us in the next 5 years. So it is 
very troubling your budget proposes to cut energy storage R&D 
by almost 75 percent.
    And let me read to you directly from your budget request, 
so folks, get a handle on this. You want to discontinue support 
for engagements with States, utilities, and storage providers 
for conducting grid-scale field tests and trials. Discontinue 
support for engagement with State and Federal regulatory 
officials on efforts to understand regional market barriers to 
energy storage deployment. Discontinue support to States and 
regional entities on procurement, commissioning, and techno-
economic analysis of deployed systems. Eliminate support for 
new collaborative test bed and field trials. Discontinue 
support for development of enhanced tools and data to U.S. 
industry for development and use of grid-scale batteries. And 
this goes on.
    But why, you talk about energy dominance, but this is like 
waving white flags. Why would you propose such devastating cuts 
for a technology that would only increase the use of clean 
energy especially when our U.S. industries are in the fight of 
their life with China? So how do you explain that?
    Secretary Perry. Ms. Castor, thank you for recognizing the 
great job that was done by particularly the private sector down 
in Puerto Rico. They were men and women who left their families 
for long periods of time. I was on a call yesterday with the 
subsector council and just said thank you as you have today. So 
thank you for recognizing that.
    Let me just briefly address your concerns here particularly 
on the issue of--and again I don't want to go back over what I 
talked with Mr. Rush about, but we see a lot of the dollars 
that have flowed into this area before particularly on wind and 
solar as areas where they are being substantially more mature. 
The cost of those have gone down. I think each one of them 65 
percent at least over previous year to date costs. So we have 
seen some substantial decreases in the cost of getting those 
technologies to the marketplace.
    And I think we are going through a shifting to battery 
storage and beyond batteries, if you will, which is a new focus 
in the fiscal year 2019 budget that we are going to be within 
EERE we are taking a holistic approach to energy storage. Early 
stage R&D is focused on controllable loads, on hybrid systems, 
new energy storage technologies, and again, this process is 
about finding the right balance and we are going to work with 
you to find that right balance.
    I not only recognize but respect your position here and you 
are absolutely correct. We have a huge challenge with China not 
just in this area but in a host of other ones. Supercomputing 
is one of them that I will suggest to you is at the top of that 
list. If we don't get that one right we are in trouble.
    Mr. Upton. Thank you.
    The gentleman from West Virginia, Mr. McKinley.
    Mr. McKinley. Thank you, Mr. Chairman. And thank you, Mr. 
Secretary, for particularly for your interest in preventing the 
premature closing of our country's coal and nuclear power 
plants.
    But let me speak to a broader audience. This committee has 
held numerous hearings on this topic of grid reliability over 
the past few years. During that time, your last 10 years, 531 
coal-fired units and 11 nuclear plants have been closed. Their 
output has been replaced with gas plants, but unfortunately 
only half of those plants have a firm supply for gas, meaning 
without a supply contract in a cold spell gas is understandably 
diverted from creating electricity for home residential 
heating. And according to NERC, in the past 3 years America has 
experienced over 4,000 forced outages of power plants across 
America due to a lack of fuel. Ninety four percent of those 
outages were gas-driven power plants.
    So this should not, unfortunately, these statistics don't 
give me the confidence that closing more coal units and nuclear 
power plants is a dependable option for national security. And 
you have been talking about national security throughout your 
presentation today. For example, nationally, in January, NETL 
reported without the resilience of coal the East Coast would 
have suffered severe electrical shortages, leading, likely, to 
widespread blackouts.
    And earlier this year, ISO concluded the possibility that 
power plants won't be able to get the fuel they need to run is 
the foremost challenge to a reliable power grid in New England. 
According to PJM, the PJM's market, it can also be shown that 
the demand for the grid could not have been met without coal. 
These are all quotes that are coming from major sources, major 
reliable sources.
    So taking these reports in consideration, can you just 
imagine what our grid stability was going to look like with 
dependability and resilience if we have fewer coal and nuclear 
plants? Mr. Secretary, you and I have had numbers of 
conversations about it and this committee has been saying all 
along that our fuel security is a national security issue.
    So, Mr. Chairman, I would like to submit for the record a 
series of documents, a letter that we have from 23 bipartisan 
members of Congress asking you to invoke 202(c). I have another 
letter that is written to the President, bipartisan support for 
some kind of implementation to save our aging coal and nuclear 
power plants. And we have four other letters of support from 
labor unions across the country and interest in saving and 
implementing 202(c).
    [The information appears at the conclusion of the hearing.]
    Quite frankly, Mr. Secretary, I believe it is time. You 
tried the 403. Some form of 202(c) or some other emergency act 
is necessary if we are going to have national security. So I am 
calling on you to use whatever legal power you have so that we 
can meet the challenges that our manufacturers need and our 
communities need all across America with having a reliable grid 
system.
    So I would like to have your thoughts. Last Thursday I was 
with the President and he specifically said, I think in a crowd 
in West Virginia, I think we can work something out on 202(c). 
I know he has had conversations with you about that. Can you 
share the extent of not your private conversations, where do 
you think we are going with 202(c) or some component of that? 
Thank you.
    Secretary Perry. Mr. McKinley, I hope that your remarks 
have been televised and we can put them up because you have 
succinctly made the point for exactly what has to happen in 
this country from the standpoint of being able to protect the 
resiliency and the reliability of our electrical grid. And if 
you do not have sufficient coal and nuclear plants, the day is 
coming when particularly in the Northeastern part of the United 
States because of other restrictions that they have on energy 
flowing into that part of the world that the national security 
of this country is jeopardized.
    I don't think that is appropriate in any way. Political 
decisions that put people's lives in jeopardy are inappropriate 
and I think this President understands that. He has had 
multiple conversations with me and others in his administration 
to find a solution to that. That is exactly what we are working 
on today. There are a numberm, as you said 202(c) is one of 
those, there may be other options which we need to look at as 
well.
    Mr. McKinley. Are we getting close to a decision?
    Secretary Perry. Expedition is of importance.
    Mr. McKinley. Thank you. Thank you, Mr. Secretary, and I 
yield back.
    Mr. Upton. The gentleman's time is expired.
    The gentleman from Maryland, Mr. Sarbanes.
    Mr. Sarbanes. Thank you, Mr. Chairman.
    Thank you, Secretary Perry, for being here. Last October 
when you were here we talked about these ongoing threats to our 
national security, a little bit different from what you were 
just speaking about, which is the national security associated 
with maintaining a kind of diversified portfolio of energy 
sources. This is more about the cyber attacks that are coming 
in and we already know that there has been hacking attempts by 
the Russians against our elections last year.
    But we now know last month the Department of Homeland 
Security, FBI, publicly accused the Russian Government cyber 
actors of a multi-stage intrusion campaign that is going after 
the energy infrastructure. And I assume, I know that you view 
that as intolerable those kinds of attacks on our energy 
security framework, presumably.
    Secretary Perry. Oh, absolutely. Yes, sir.
    Mr. Sarbanes. And in the budget for fiscal year 2019 there 
is $96 million proposed for a new office to address cyber 
threats coming in against the energy sector and I appreciate 
that attention being given. I think we need a little bit more 
knowledge here in Congress to be able to respond appropriately 
to the proposal with respect to cybersecurity in combating 
these cyber threats. And last October you may recall I asked 
whether you would be willing to come and do a briefing on that 
specific topic. We haven't had that yet so I would like to 
reiterate that request for a briefing.
    We can try to work with the committee. Obviously 
Congressman Latta, McNerney, and others have a real interest in 
this. I am sure the chairman does as well. So I just wanted to 
ask if you would be willing to work with the committee and our 
office to try to get that kind of a briefing together.
    Secretary Perry. Yes, sir. We will work with the committee.
    Mr. Sarbanes. Thank you very much. I want to talk now about 
a proposed cut in the budget. It is a 70 percent cut to the 
Office of Energy Efficiency and Renewable Energy for fiscal 
year 2019. This program, the EERE program, as many colleagues 
of mine have been pointing out, has been a very smart return on 
investment for taxpayers, a net benefit of $230 billion when 
you look at what has resulted from it.
    I wanted to talk a little bit about what it means in my own 
district. One of the programs inside the EERE program or 
initiatives was the SunShot Initiative and that has been 
targeted for a 67 percent cut. This initiative was one where 
the Department of Energy would set a goal of capturing the 
potential of solar technology, which everybody acknowledges is 
critical in making solar electricity more affordable, by 2020. 
In Baltimore we actually worked with the Department of Energy 
to bring that potential to low-income homeowners so that all 
communities would be able to take advantage of low cost solar 
and energy.
    So it has meant a great deal to Baltimore. Over the last 
few years we have been able to put in 53 rooftop solar 
installations for low-income homeowners. There is 990 
additional ones planned over the next 2 years and with DOE's 
continued support the Baltimore Shines model, which is our 
local sort of version of the SunShot Initiative, if you will. 
This can really be a model across the country and we think can 
lead in terms of what it means to have diversified financing 
for low-income solar installation.
    So the basic question here is does your Department remain 
committed to the goals of the SunShot Initiative which seems to 
be like the terminology of it or the name of it is being pushed 
aside. It is hard to keep track of where your commitment is and 
the Department's commitment is to this solar technology 
advancement is. And will you maintain the same commitment 
within the Solar Energy Technologies Office that has been a 
hallmark up to this point and further commit to making sure 
that low-income communities are in a position to take advantage 
of these low-cost energy and skilled job opportunities which 
are available within the solar technology industry?
    Secretary Perry. Yes, sir. Mr. Sarbanes, let me work with 
you. I am not that knowledgeable with that specific program 
from a granular standpoint and I want to be able to give you an 
appropriate answer so I will follow up.
     Mr. Sarbanes. I appreciate that. I think if you look 
inside the Department's data on this it is quite impressive and 
we can help present some of that back to you as well.
    Secretary Perry. Yes, sir.
    Mr. Sarbanes. Thank you.
    Mr. Upton. Mr. Kinzinger?
    Mr. Kinzinger. Thank you, Mr. Chairman. If I can get Mr. 
Flores' attention for a second, yes, there you go. Thanks.
    Mr. Secretary, thank you for being here. As you may or may 
not know I have four nuclear power plants in my district which 
is the most of any in the country. It is eight reactors. 
Obviously that is many locations for spent fuel storage and so 
nuclear is extremely important not just for our domestic energy 
production, but one of the things last time you were here you 
and I talked a little about was energy as a tool of national 
security and the importance of that and the role that that 
plays.
    Just this week you made the point that every molecule of 
American gas that goes into Europe is a molecule that they 
don't have to get from Russia and be held hostage. I know you 
are aware the Russians are building or considering about 55 
nuclear projects around the globe and for China that number is 
closer to 200 projects. Does your sentiment about Russian 
natural gas apply to nuclear power as well, sir?
    Secretary Perry. Yes, sir. It does. And I think it goes 
right to the heart of the agreement with Saudi Arabia that is 
being negotiated now, the 123 Agreement, in the standpoint of 
if we do not succeed in that effort the alternatives are China 
or Russia. Number one, neither of those countries care about 
nonproliferation, and the other one is we will lose the 
opportunity to develop our supply chain and our intellectual 
chain that will further put America at a disadvantage. And not 
just in the civil nuclear side, but sometime down the road on 
our ability to protect this country from a weapons standpoint. 
So this is a critical time in American history relative to 
supporting nuclear energy, civil nuclear energy.
    Mr. Kinzinger. Thank you. And I appreciate that your budget 
request prioritizes nuclear energy research, nuclear security, 
and of course Yucca Mountain. However, I remain deeply 
concerned about the state of our domestic nuclear industry as 
we have talked about. I have introduced legislation with my 
friend, Mr. Doyle, to make common sense reforms at the NRC to 
provide existing plants some relief, but without a strong 
domestic industry how do we expect American technology and, 
more importantly, safety culture and nonproliferation standards 
to compete with state-run power companies like Russia and 
China. So, overall, what is the DOE currently doing or planning 
to do to support our domestic industry and reaffirm our global 
leadership?
    Secretary Perry. Well, obviously the administration is the 
message is clear not just on the nuclear side but coal as well 
and it is not just those two. This administration is committed 
to a broad portfolio of renewables of gas, of hydro, coal, and 
nuclear.
    Mr. Kinzinger. And while I believe that H.R. 1320 is part 
of the solution, there are several options to put the domestic 
nuclear industry on steadier ground and increase our global 
competitiveness. Can you elaborate as much as you can on DOE's 
Light Water Reactor Sustainability Program which is looking at 
extending existing licenses from 60 to 80 years?
     Secretary Perry. Yes, sir. We will continue to promote 
those technologies as best we can. We think that again this 
plays into the diverse portfolio and new technologies whether 
it is clean coal technologies, whether it is--I was on the West 
Coast at Livermore Lab 2 weeks ago looking at technologies that 
are making our wind turbines more efficient. So there is a host 
of innovation rather than regulation is the real motto here 
from our perspective.
    And whether it is in the nuclear side of things, whether it 
is in the fossil fuels, whether it is in the renewables, the 
national labs and the dollars that you all are authorizing for 
these national labs will go a long way toward making America 
more competitive in the global energy marketplace.
    Mr. Kinzinger. Thank you. And, lastly, do you believe that 
wholesale energy markets can do a better job at valuing the 
unique resource attributes of nuclear power, and if so how can 
DOE and Congress help to reform these energy markets? What role 
can we play in doing so?
    Secretary Perry. Well, I think one of the roles that DOE 
needs to play in this is to rebalance that obviously previous 
to this administration coming into place there were some thumbs 
on the market and at least we should take that pressure off of 
the direction that those markets were headed. Obviously there 
were some political considerations in the previous 
administration that they were not fond of coal, they were not 
fond of nuclear, and both of those industries paid a price for 
it. They had their favorites in the arena and they supported 
those. What we are looking at is to rebalance, if you will, to 
take the thumb off of the market scale.
    But with that in mind, the more important issue is one of 
national security. Being able to know without a doubt that the 
energy supply will be there when we need it whether it is from 
a cyber attack that stops the transmission of gas somewhere, 
whether it is a hurricane that hits the, God forbid, not again, 
the northeastern part of this country, the national security 
side of this is even more important than the economic side of 
it.
    Mr. Kinzinger. Thank you, Mr. Secretary. I appreciate you 
being here and I yield back.
    Mr. Olson [presiding]. Time has expired.
    Mr. Tonko for 5 minutes of questions.
    Mr. Tonko. Thank you, Mr. Chair.
    Welcome, Secretary Perry, and thank you for returning 
before the committee. Over the past year I haven't agreed with 
all of your decisions or priorities. I thought the notice of 
proposed rulemaking was incredibly misguided, but overall, and 
it might surprise you to hear me say this, I think you have 
done a fine job as Secretary.
    Secretary Perry. Yes, sir.
    Mr. Tonko. As far as I am aware there have been no major 
scandals or extravagant waste of taxpayer dollars. You have 
visited many national labs and it seems like you believe in the 
mission of the agency, all of which is more than I can say for 
some of your cabinet counterparts.
    With that said, I am concerned by a number of the proposed 
cuts in fiscal year 2019's requests. Many of them have been 
mentioned already, EERE, the Office of Science, grid 
modernization programs, and the elimination of ARPA-E. In the 
past you have stated support for ARPA-E and DOE's innovation 
budget. Last year you testified that energy innovation is a 
part of DOE's core mission and I think you might agree that 
cuts of the magnitude that have been proposed are not good for 
the future of America's global energy leadership.
    So I would encourage you to push back on OMB to ensure 
innovation continues to be a top priority of the agency. 
Specifically, now that Congress has appropriated fiscal year 
2018 funding for programs that the previous request proposed 
eliminating, I expect we won't see a repeat of last year's 
impoundment of ARPA-E funds or a delay of weatherization 
funding to states which they are expecting on July 1.
    But I want to focus on a different issue. Mr. Secretary, 
are you familiar with this recent National Energy Technology 
Laboratory report entitled, ``Reliability, Resilience and the 
Oncoming Wave of Retiring Baseload Units''? It is dated March 
18th, or March 13th, excuse me, 2018 and it was posted on DOE's 
website on March 27th.
    Secretary Perry. I am not an expert at it, but I am 
certainly familiar with it.
    Mr. Tonko. OK. Are you aware of any DOE political officials 
that discussed this report as it was being developed by NETL?
    Secretary Perry. I am not.
    Mr. Tonko. Would you be willing to share any communications 
between DOE officials and NETL about the report with the 
committee?
    Secretary Perry. I would be happy to.
    Mr. Tonko. Thank you. The reason I ask is because this 
report is cited numerous times in FirstEnergy's section 202(c) 
request which was submitted just 2 days after the report was 
published on DOE's website. I want to take issue with how the 
report represents the data to conclude coal made the grid more 
resilient during the bomb cyclone.
    I think most economists and grid operators agree on what 
happened. There was greater electricity demand, prices 
increased, and that allowed marginal power generators to come 
online. In PJM those are coal plants that under normal 
circumstances are not economically competitive. We saw 
electricity markets at work. When demand increased, more 
expensive generators could operate. This is evidence of coal's 
cost, not its resilience. In fact, according to PJM, at times 
coal plants experienced higher failure rates than other 
resources.
    This notion that the only thing standing between us and 
blackouts is aging coal plants is just not accurate. What we 
might agree about, but I suspect for different reasons, is the 
premature closure of a significant amount of clean energy 
resources would be bad for air pollution as well as our short 
and long-term emissions reduction goals. If that is the case, 
we should look at what has been done by States, States such as 
my home State of New York, to preserve and compensate zero 
emissions generation. Or if you prefer an in-market solution, 
consider what New York's ISO is working on to develop to price 
carbon within the market.
    These options are not without their flaws or opponents, but 
they do represent a serious path forward to address some of the 
issues you have been discussing this past year. But ultimately 
these are policy decisions for States or for Congress. Acting 
under the pretense of an emergency to justify unilateral agency 
action is not good for consumers or the people responsible for 
operating our grid.
    So, Secretary Perry, do you have any thoughts on the role 
or appropriateness of States taking action to support zero 
emission generators through clean energy standards or similar 
programs?
    Secretary Perry. No, sir. I encourage States to get 
involved with making their states more competitive. I certainly 
did that when I was the Governor of Texas and we saw a 
reduction, almost 20 percent of total carbon footprint, over 60 
percent of both CNOx and SOx during that 
period of time. So the point is, states can have a real role in 
this.
    With that said, from my perspective this issue that we are 
facing and I recognize--and by the way thank you for your kind 
remarks. My wife doesn't even agree with me all the time, so--
--
    Mr. Tonko. OK. Well, I need to meet her then.
    Secretary Perry. Yes, sir. I am going to show her this, if 
you don't mind. But the point is that there are real national 
security implications here. And I will finish with this. As the 
Governor of Texas I brought in ERCOT, which is our big Electric 
Reliability Council that oversees our generation in Texas. And 
I think it was late spring of one year we had had a very hot 
summer, which we typically do in Texas, and we had had some 
brownouts. We were trying to manage the system.
    And I shared with them, I said, listen, you are the expert 
here, but I don't want to get a phone call from citizens of 
this state because you weren't prepared and you didn't put in 
place the needed generation capacity to be able to deliver 
electricity to a city like Dallas that has had 15 straight days 
of 105-plus degree temperature and a grandmother has died. I 
said that is not a conversation that I am going to accept, and 
the same is true as the Secretary of Energy.
    And the administration is focused on making sure that we 
have the resiliency and the reliability of our grid, and I want 
to work with you. I will work with the states as well to find 
the solutions to this. But I don't think we have time to be 
studying this anymore to the standpoint of oh, let's just kick 
the can down the road. I think we are facing with these plants 
being scheduled, some of them prematurely, to come offline, I 
just don't want a call from somebody in Upstate New York 
because the power has gone out because we didn't have the 
political courage to put into place a strategy that made sure 
that a citizen of New York is never going to have to make the 
decision of whether or not we are going to turn the lights on 
or are we going to keep our family warm.
    Mr. Tonko. I have exhausted my time. I would just say that 
New York did make certain that they had their power supplies 
met and with zero emissions being the guiding force. So I think 
that is the difference here.
    But I yield back, Mr. Chair.
    Mr. Olson. Time is expired.
    Mr. Griffith, 5 minutes for questions, please.
    Mr. Griffith. Thank you, Mr. Secretary. I appreciate you 
being here. All my questions have gone out the window because 
of comments that have been made of recent or at least a lot of 
them have.
    You were very kind to the previous administration to say 
they put their thumbs on the scale when they were looking at 
various energy sources. In my district which has got natural 
gas, predominantly coal, we felt like it wasn't a thumb on the 
scale, we felt like it was a boot on our necks. We had 
thousands of jobs lost, families disrupted, communities losing 
businesses left and right, hospitals closing down because they 
no longer had the big employer at the coal mine to pump in the 
insurance into the hospital and the money coming in there. It 
was devastating.
    And so I was kind of surprised, one, that Mr. McKinley 
missed the NETL report in his detail. He kept going. I guess he 
had to have some time for questions and so he left that one 
out. But further that Mr. Tonko doesn't understand. And he is a 
good man, but he doesn't understand. It would be easy for 
people who were that desperate like a thirsty man in the desert 
who finally discovers an oasis to consume that NETL report and 
put out the request for 202(c) relief within 2 days because the 
coal community has been desperate until you all have come along 
and not wanting to put your finger on the scale at all but 
wanting to make sure that there is an all-of-the-above strategy 
for the United States, and I thank you. Would you like to make 
any comment before I go on?
    Secretary Perry. Go right ahead, sir.
    Mr. Griffith. All right. So I appreciate that and I do have 
this to say although it is not your Department. He indicated 
that, the fact that we had to use the coal and it cost more 
that that was the markets at work. It is also Federal 
regulation. Because what we need to do is we need to look at 
the New Source Review rules, because when a coal-fired power 
plant and lots of other businesses that use coal for power go 
in and they want to make one little change, even if it makes 
that plant more efficient, they have to then comply with all 
kinds of regulations.
    I have a facility in my district which is not a power 
plant, another facility that I toured a number of years ago and 
they had a kink in their conveyor belt because at one time 
there had been a part of their paint shop on the end of the 
conveyor belt. They no longer had that paint shop or that 
painting capacity, I think it was lacquer, but they left the 
kink. And so we walked over the conveyor belt once and then we 
walked over it a second time where it just went out into empty 
space, and the owner said that because he had to meet those EPA 
regulations it was easier just to leave the kink in the 
conveyor belt than to make his process more efficient. We need 
to make some changes there and I hope you would agree with that 
even though I know it is EPA's turf.
    Secretary Perry. Right. Mr. Griffith, I think you bring in 
a very high level way what this administration is focused on. 
The President has given clear directives to people like myself, 
Scott Pruitt, Secretary Zinke from a regulatory standpoint that 
getting rid of regulations where the costs outweigh the 
benefits is one of the real goals. And it has been, I think, 
very successful to date.
    And the key here is having some common sense applied, being 
able to recognize that we have overregulated this country and 
those overregulations have cost this country a huge amount of 
jobs and untold wealth.
    So you were spot on from the standpoint of the single most 
important thing I learned as a governor that tax policy is 
important. You don't overtax, but businesses know how to deal 
with that. It is when you have a regulatory environment that is 
strangled where you will lose your businesses. It is one of the 
reasons we were able to bring a lot of businesses out of 
California to Texas, no offense to anybody from California that 
is here. But the point is they were overregulating and 
businesses want to get out of that environment.
    So the regulation side of what you are talking about is 
incredibly important. It is not just about being able to 
address the national security side of things, the issues that 
we talk about whether it is a 202 or whether it is some other 
avenue towards making sure we have a reliable portfolio, but 
the regulatory environment in this country has to be addressed.
    Mr. Griffith. And I could not agree more. And I appreciate 
all the work that you all are doing in the administration to 
get this straightened out because it really has, I think, hurt 
our country.
    That being said, let me switch to more positive things. Ms. 
Castor complimented you on the testimony of one of your folks 
at the O&I subcommittee yesterday related to Puerto Rico. I 
think that they are doing great work down there and we 
appreciate it, but I think we can also use that as a test bed 
for other areas that might get isolated in a disaster and look 
at doing microgrids and other things that we can move this 
country forward to make sure that we have our grid resilient. 
We have a perfect example. We are going to spend a lot of money 
there anyway. Let's spend it doing experiments to see how we 
can build the system for the rest of the country as well.
    And with that, I know you agree but I have to yield back.
    Secretary Perry. Yes, sir.
    Mr. Olson. Time is expired.
    Mr. Loebsack, 5 minutes for questions.
    Mr. Loebsack. Thank you, Mr. Chair.
    Great to see you again, Mr. Secretary.
    Secretary Perry. Sure, thank you.
    Mr. Loebsack. We don't have a lot in common, Iowa and 
Texas, but we do have wind energy in common.
    Secretary Perry. I have spent a lot of time in your home 
state, sir.
    Mr. Loebsack. I am aware of that too. That is right. Seems 
like ages ago, but I am aware of that. Thank you. But I am 
happy about your support for wind energy. As you know that 
constitutes about 37, 38 percent of the electricity generated 
in the State of Iowa so it is really a great program. And thank 
you for coming back to this committee. I do appreciate the 
accountability that you demonstrate here. I think all of us do 
on a bipartisan basis.
    As you know of course my home State of Iowa does lead the 
Nation in biofuels production. It is an integral part of our 
economy, the farm economy, and right now the farm economy is 
suffering. We have concerns about trade issues too, we don't 
need to get into that today. But that is certainly a bipartisan 
concern that we have in the State of Iowa, what is happening on 
that front. And I am sure that you are aware of the recent 
press reports about the waivers that the EPA has granted the 
small refineries to release them from their obligations under 
the Renewable Fuel Standard program including, actually, some 
of the Nation's largest and most profitable refiners.
    And as you can imagine, the biofuels community has 
significant concerns about the apparent increase in the 
awarding of these waivers by the EPA and about the implications 
for the biofuels industry, the corn market and of course the 
farmers who depend upon the market and the workers in the 
industry, all the John Deere and a lot of other, the implement 
companies that are all related to this as well economically. 
And the small refinery waiver process as you know requires the 
EPA to consult with the DOE and with you, the Secretary of 
Energy in particular, in review of the exemption petitions and 
unfortunately there is not a lot of transparency, if any, in 
this process.
    So I do want to ask you, has the EPA consulted with the DOE 
on their issuance of these waivers as required by law?
    Secretary Perry. Yes, sir. I would suggest to you they 
have. I don't know the intensity and that may be the wrong 
word, but the depth of those negotiations and what--I know that 
they use us as the agency to advise them about how this would 
impact the energy sector. So, but for clarity purposes, EPA is 
who hands out those.
    Mr. Loebsack. Right. But they are required by law to 
consult with DOE, with the Secretary of Energy, right?
    Secretary Perry. But they do consult with us. Yes, sir.
    Mr. Loebsack. Does your office recommend that EPA adopt any 
small refinery waivers this year, and if so what waivers did 
you recommend?
    Secretary Perry. Let me go back and get the details of that 
for you so that I can give you specific and correct 
information.
    Mr. Loebsack. Yes and I really do appreciate that because 
what I am going to ask you then, moving forward, just yesterday 
your counterpart at the USDA, Secretary Sonny Perdue, indicated 
that he believes the EPA is misusing the hardship waivers. And 
as you know our governor is in town today too and she is trying 
to get through to the President to talk to him about the RFS.
    Secretary Perry. Yes, sir.
    Mr. Loebsack. Do you agree with Secretary Perdue that the 
EPA has misused the hardship waivers?
    Secretary Perry. I can't speak to that because I don't know 
the details of the issue. If I could just add one side of the 
story, one of the things that we are working on is to find some 
other, it would be, number one, I know my Iowa corn farmers 
pretty well and they really don't care where this ethanol goes 
as long as it gets to go somewhere.
    Mr. Loebsack. I just had a meeting with a number of them 
last weekend.
    Secretary Perry. Yes, sir. And I respect that having been a 
former agricultural commissioner of the State of Texas. We are 
in conversations with my counterpart in Mexico and we were 
talking to him as late as this last month about being able to 
move U.S. ethanol into Mexico into their fuel mix because they 
are in the process of we understand that they are going to be 
mandating some ethanol.
    Mr. Loebsack. And I really appreciate that. And we have to 
keep in mind too that we are talking about a lot of production 
of corn here in the country and of course around the world and 
ethanol is obviously one use of that corn. There is no 
question. But we have to make sure in those NAFTA 
renegotiations that we don't get our corn market in Mexico cut 
off as well.
    So I just have some questions. I don't have time to go 
through them here, but I do want to submit these questions for 
the record having to do with the total number of refinery 
waiver applications that the DOE evaluated for the last 5 
years. So a number of those and I would like to submit those 
for the record, Mr. Chair.
    Secretary Perry. So we will have them ready for you.
    Mr. Loebsack. And thanks for your time today. I appreciate 
it. And we look forward to your answers to our questions.
    Secretary Perry. Yes, sir.
    Mr. Loebsack. Thanks, Mr. Secretary. I appreciate it. I 
yield back.
    Mr. Olson. Thank you.
    Mr. Johnson, 5 minutes of questions.
    Mr. Johnson. Thank you, Mr. Chairman.
    Mr. Secretary, good to see you again.
    Secretary Perry. Thank you, sir.
    Mr. Johnson. I sure enjoyed our trip down to Piketon a few 
months ago.
    Secretary Perry. Yes, sir.
    Mr. Johnson. You and I had extensive discussions when we 
were there and, like you, I support an all-of-the-above energy 
policy and I know you believe that as well. My district in 
Eastern and Southeastern Ohio, and you and I have talked about 
that a little bit as well, is no stranger to the benefits of a 
diverse generation with our abundance of both coal and natural 
gas. Many of the coal plants in the 6th District of Ohio, along 
the Ohio River are not only a reliable source of power but they 
are the strong economic drivers for the communities in which 
they exist. The people rely on them there for good paying jobs.
    So I worry about the recent retirements and announced 
retirements of coal plants especially as Federal and State laws 
and regulations have played a major role in affecting these 
plants over the years. I know you have repeatedly expressed 
similar concerns and have pushed FERC on these issues. So my 
first question, are you satisfied with FERC's work to date on 
this issue and do you believe FERC and the RTOs and the ISOs 
are taking the right approach to these issues?
    Secretary Perry. Well, relative to the 403 that we sent up, 
I would have to be on the opposing side of, I wouldn't have 
sent them our recommendations if we didn't think they were 
correct. So, that is the only dealings that I have had with 
them to date.
    Mr. Johnson. Sure.
    Secretary Perry. So my first experience of picking up that 
potato was it was pretty hot.
    Mr. Johnson. Yes, yes. Well, second question, you state 
that the fiscal year 2019 DOE budget will help improve grid 
resilience and support generation diversity. Can you provide 
examples on how DOE will work towards these objectives?
    Secretary Perry. Well, obviously having grid diversity has 
to do with having resource diversity. One of our challenges is 
that in the course of the last decade the resources have 
changed drastically. You think back to 2005, just as Hurricane 
Katrina was coming into the Gulf Coast there was a fellow 
giving a speech about peak oil. Fast forward 10 years and the 
United States is in the process of becoming the number one oil 
and gas producing country in the world. I mean that literally 
happened in a decade, the explosion of renewables and the grid 
being able to manage all of that and so the technology to 
manage the grid. And I put that into the resiliency side and 
the reliability side.
    So the challenges that are out in the world today and how 
quickly they came is a great testament to our national labs and 
the innovation that comes out of those national labs and our 
private sector working together in many cases. So the way we 
look at this is we have been blessed with a lot of resources. 
How you manage those resources both with innovation and with 
common sense, common sense part of this from my perspective is 
don't restrict resources getting into your grid that could put 
your national security in jeopardy, for instance.
    So all of this is, it is quite a challenge, Mr. Johnson, as 
you know, but I am quite confident we are up to it and we will 
find the solutions that challenge us as a country.
    Mr. Johnson. Yes. Well, thank you, Mr. Secretary.
    Shifting gears just a little bit, when we were at Piketon, 
you and I, and I appreciate your support of all the stuff that 
is going on down at Piketon as well. I appreciate that very 
much. You have made reference to an Appalachian plan which 
relates to infrastructure to take advantage of our natural gas 
resources and other industrial resources in West Virginia and 
Ohio. Can you elaborate quickly what that vision looks like?
    Secretary Perry. Yes, sir. As the Governor of Texas I used 
to fret greatly in August and September about a Category 5 
hurricane coming up the Houston Ship Channel, Mr. Olson, and 
creating havoc in the petrochemical footprint in the State of 
Texas which would have negative effect all over this country. 
Having a duplication of that somewhere made a lot of sense to 
me and why not put it where the resource is which is in the 
Appalachian region. You are sitting on top of the Marcellus, 
the Utica.
    So if government will not be an impediment from a 
regulatory standpoint in particular, the private sector will 
come and fund that. This isn't a matter of coming to Congress 
and saying hey, will you put millions of dollars into this. 
Just don't get in the way.
    Mr. Johnson. There you go.
    Secretary Perry. And help those States, West Virginia, 
Pennsylvania, Ohio, Kentucky, put that plan together. We are in 
the, I am not going to say nascent but we are in the early 
stages of conversation coordinating with those states, 
coordinating with other agencies to be able to lay out a plan 
hopefully before this year is out so that there is a clear 
opportunity for this country to have a duplication of that 
petrochemical footprint in the Gulf Coast of Texas in the 
Appalachian region. The economic impact would be stunning. More 
importantly, the national security side of it would be far-
reaching.
    Mr. Johnson. Makes perfect sense.
    Thank you, Mr. Chairman. I yield back.
    Mr. Olson. The gentleman yields back.
    Mr. Schrader, 5 minutes for questions.
    Mr. Schrader. Thank you, Mr. Chairman. And thank you, Mr. 
Secretary, for being here. It is nice to have a normal and 
competent member of the administration before the committee 
here.
    I would like to go back to Chairman Walden's comments 
regarding the Power Marketing Administrations. As you might 
imagine that is a bipartisan issue in my part of the country. 
On page 14 of your testimony you state budget proposes a sale 
of transmission assets of the Western Area Power 
Administration, Bonneville Power Administration, and 
Southwestern Power Administration and to reform the laws 
governing how the PMAs establish power rates, et cetera.
    Frankly, as a member of Congress in the Pacific Northwest, 
very concerned about the administration's continued insistence 
we sell off transmission assets at the Bonneville Power 
Administration and require them to sell power at market rates. 
Mr. Chairman, I guess I would like to enter into the record the 
bipartisan letter the Pacific Northwest delegation sent to OMB 
Director Mr. Mulvaney opposing this proposal in the 2019 
budget.
    Mr. Olson. Without objection, so ordered.
    (The information appears at the conclusion of the hearing.]
    Mr. Schrader. Thank you. The BPA is a nonprofit Federal 
wholesale utility and power marketer that receives no 
congressional appropriations. I repeat that, no congressional 
appropriations, and must recover its costs with revenues it 
earns like the private sector from selling wholesale power and 
transmission services. BPA provides approximately half the 
electricity used in the Pacific Northwest and operates three-
quarters of the region's high voltage transmission grid. 
Selling off these transmission assets would fragment the grid, 
be devastating to the region, and provide a meager one-time 
asset that would not have any long-term beneficial effects with 
regard to our economy.
    By requiring BPA to sell power at market rates would 
essentially be the death knell of BPA. BPA serves the public 
interest and has other obligations and as such BPA markets its 
power at cost. Historically, it has provided some of the lowest 
cost electricity in the Nation, natural gas having put some 
pressure on it obviously at this point. And that coupled with 
BPA's increased court-mandated spill and fish recovery 
operations, which account now for a third of the rates that 
Pacific Northwest folks pay and that Treasury consequently does 
not have to pay, has put additional cost pressures on the 
agency and driven their costs up some.
    Requiring BPA to sell its power at market rates would drive 
them into the red, make them unable to meet their obligations 
to the Treasury, actually costing taxpayer money, strand the 
Federal Government with a very expensive, nonfunctioning asset 
and put fFederal taxpayers on the hook for the fish mitigation 
costs which come to the tune of almost a billion, or I think a 
little over a billion dollars a year.
    There has been overwhelming bipartisan, bicameral 
opposition as the chairman of the full committee testified to, 
opposition to the administration's proposal. Eight members of 
this committee including my fellow Northwest colleagues, Ms. 
McMorris Rodgers and Chairman Walden, sent a letter to our 
budget committee this year that I referenced asking them to 
reject the proposal, yet once again it seems like we are here.
    So our region already produces some of the cleanest power 
that we have talked about, very affordable. We repay the 
Treasury with interest. So if you can explain to me what 
problem the administration is actually trying to solve with 
this proposal.
    Secretary Perry. Mr. Schrader, let me just remark that 
maybe it is my best addition here would be I am reminded of a 
Kenny Rogers song where he talked about you need to know when 
to hold 'em and know when to fold 'em.
    Mr. Schrader. I understand and appreciate that response and 
appreciate your----
    Secretary Perry. Congress has been very clear about this 
issue. I will be more than happy to carry the message back.
    Mr. Schrader. Thank you very much, Mr. Secretary. Thank you 
for being here.
    Secretary Perry. Yes, sir.
    Mr. Olson. The gentleman yields back.
    Dr. Bucshon, 5 minutes of questions.
    Mr. Bucshon. Welcome, Secretary Perry, from Southwest 
Indiana.
    Secretary Perry. Yes, sir.
    Mr. Bucshon. This committee has spent most of this Congress 
examining the country's electrical grid and throughout our 
hearings experts have stressed to us the importance of a 
reliable and resilient electrical grid. There are many sources 
of energy that can power the grid. However, coal-fired 
electricity is one of the most reliable fuel secure and 
affordable energy sources. This was evident during the 2014 
polar vortex and again most recently with the bomb cyclone. It 
was the reliable baseload power plants such as coal and nuclear 
that prevented blackouts in many regions of the country.
    Even with its reliability, coal-fired plants continue to 
retire at alarming numbers, and I know Mr. Johnson just 
mentioned this. Since 2010 more than one-third of the Nation's 
coal-fired power plants have shut down or announced plans to 
close. That is the equivalent of shutting down the entire 
electricity supply for Indiana, Ohio, Illinois, and Kentucky. 
Thirty nine coal power plants, power generating units have been 
forced to close in my home State of Indiana alone.
    The 8th District of Indiana which I represent is home to 
all the coal mines in the State of Indiana which is responsible 
for more than 70 percent of the State's energy. Without 
traditional baseload energy sources such as coal being properly 
valued in wholesale markets plants continue to be at risk of 
retiring, leaving many of my constituents at risk of losing 
their jobs, seeing higher electrical bills, and providing less 
reliable energy to power our homes.
    This is why I have introduced H.R. 5270, the Electricity 
Reliability and Fuel Security Act, which would create a 
temporary tax credit covering a small portion of the cost to 
operate and maintain existing coal-fired power plants. I 
believe the temporary tax credit which would last for 5 years 
is necessary to avoid more coal retirements while Congress, the 
administration, and grid operators work together to ensure the 
grid remains reliable and resilient.
     Secretary Perry, do you think that you would be supportive 
of this legislation and the other efforts that Congress, DOE, 
FERC, and the grid operators are taking to properly value coal 
to prevent more power plant retirements and provide our nation 
with a more reliable and secure grid?
    Secretary Perry. Yes, sir. Mr. Bucshon, I think it is 
important that we put into place some processes that assure 
this country has a reliable and resilient grid and coal is 
going to be a part of that and coal is going to be a part of 
the future energy supply of the world. By 2040, the estimate is 
at 77 percent of the energy produced in the world will still be 
fossil fuel, coal will be playing a major part of that.
    Our goal and our part to play in this is that U.S. coal 
imports are up 61 percent from a year ago, we are going to 
continue. When I go to India we are not just going to be 
talking about LNG. We are going to be talking about coal and 
clean coal technology that is developed in this country. We 
want them, they are going to burn coal and we want them to use 
our technology to be able to remove the emissions that are 
harming the environment in that part of the world and globally 
as well.
    So any reasonable approach to making sure that we have a 
reliable energy source in this country we are going to be 
working with and we certainly think your legislation is 
reasonable and heads in that direction.
    Mr. Bucshon. Thank you very much for being here, Secretary.
    Secretary Perry. Yes, sir.
    Mr. Bucshon. Thanks for your work.
    Mr. Chairman, I yield back.
    Mr. Olson. The gentleman yields back.
    The chairman calls upon the gentleman from Texas, Mr. 
Flores, for 5 minutes of questions.
    Mr. Flores. Thank you, Mr. Chairman. Mr. Secretary, I think 
you and I are equally supportive of LNG and we recognize the 
incredible importance of LNG exports not only in terms of our 
balance of trade and economic opportunity, but also the 
geopolitical position that it places us in vis-a-vis some of 
the threats that we face around the world.
    I know that you have taken some good steps to improve DOE's 
permitting process when it comes to LNG to clear the backlog of 
the applications that were pending that you inherited from the 
last administration, but I also understand that FERC is 
understaffed and that they are overwhelmed with their own 
backlog. Is there anything that you as the Secretary of DOE can 
do to help FERC with their backlog?
    Secretary Perry. I would be more than happy to have this 
conversation with the chairman and we are more than happy to 
assist them in any way we can.
    Mr. Flores. OK. It was my understanding you might be in a 
position to move some folks from Sandia temporarily to FERC to 
help with that. Anyway, if you can answer that supplementally 
for us that would be great. So, now with LNG out of the way, 
the next area that I am particularly focused on today is 
nuclear, particularly advanced nuclear technologies. The alma 
mater that you and I share, which I am pleased to represent, is 
a partner on some of DOE's university engineering university 
programs. I understand that the administration is conducting a 
wide range in review of nuclear policy, but while we await the 
outcome of that broader review what are the most important 
policies that Congress can advance now in the short term, in 
the near term?
    Secretary Perry. I am sorry?
    Mr. Flores. What are the most important policies that 
Congress can advance in the near term while we wait for the 
administration to finish its overall nuclear review policy?
    Secretary Perry. Well, certainly I think that making sure 
that the resources are appropriate on this national nuclear 
policy review, and we have for too long, I guess, Mr. Flores, 
this country has kind of put nuclear, our arsenal on the back 
burner, if you will.
    Mr. Flores. Right.
    Secretary Perry. The mid '90s and the Peace dividend and 
the world was going to live happily ever after and that is not 
the case. And we came to our senses, if you will, or the world 
became a little clearer in view and we saw that maybe we need 
to make sure that we have a nuclear arsenal that is modern. 
These things, they age just like any other infrastructure. 
Being able to modernize it, being able to look at new systems, 
whether it is delivery or whether it is the actual arsenal 
itself, is very much an important role that you in Congress are 
going to play from being able to fund it for one thing.
    Mr. Flores. Sure.
    Secretary Perry. We have a new administrator of the NNSA, a 
very capable individual who I think you will find very good to 
work with, very knowledgeable, and a good partner in this.
    Mr. Flores. When we look at the nuclear technology of the 
future, advanced nuclear reactors and small modular reactors, 
any time you have a first-mover technology like that there are 
some challenges in terms of trying to help, that our nuclear 
innovators face in terms of trying to get them off the ground 
so that they can move forward and get it into a position to be 
a commercially viable power generation source.
    I would ask you if you would have your staff work with us 
so we can try to figure out what those challenges are and what 
Congress can do to develop the statutory framework to be able 
to address those challenges.
    Secretary Perry. Yes, sir. We think SMRs are incredibly 
important going into the future, the application that they can 
play particularly in for our national security. If the concern 
is about keeping these devices secure, obviously being on a 
United States military base is as secure a site as you can 
have. So, SMRs are going to play a very, very important role in 
the diversity of our portfolio energy production-wise going 
forward.
    Mr. Flores. OK. Well, thank you, Mr. Secretary. I have 
reached the end of my time. I do have additional questions that 
we will submit supplementally and I look forward----
    Secretary Perry. Yes, sir.
    Mr. Flores [continuing]. To working with you as we address 
our nation's energy policy. I yield back.
    Mr. Olson. Time has expired.
    Mr. Cramer, 5 minutes for questions.
    Mr. Cramer. Thank you, Mr. Chairman.
    Thank you, Mr. Secretary, for being with us again. Thank 
you for your excellent leadership at the very important agency. 
Before I drill down into what is most important to me today is 
specifically the fossil energy research and development budget, 
I want to associate myself with Mr. Peters' comments about 
ITER. Even though San Diego is a long ways from North Dakota, 
his point about leveraging that resource, I think was made 
well. And I also want to associate myself with the fact that I 
do feel like there is a greater confidence given recent changes 
in leadership.
    Secretary Perry. Yes, sir.
    Mr. Cramer. And I appreciate your attention to that and 
your vast knowledge of it, so thank you for that. With that, I 
do want to get to the more concerning topic for me and that is 
the administration seems to be sort of sliding away from a 
commitment to at least if not pilot scale, commercialization 
gap with demonstration projects in the fossil energy R&D, 
particularly as it relates to where I think the folks ought to 
be and that is carbon capture and utilization and storage of 
CO2 from coal-fired power plants.
    Now we know and we appreciate in North Dakota your role, 
your agency's role in partnering with the Energy & 
Environmental Research Center at the University of North Dakota 
and some of our utilities, particularly Minnkota Power, in 
looking for some opportunity, testing some opportunity for 
Allam cycle or, and some of these technologies that will 
bridge, bridge coal, coal's past, and coal's future as a clean 
resource. But without the gap being filled or at least 
supplemented by the taxpayers, I don't know that we can get 
there, quite honestly, and yet we need it so badly.
    Specifically, the administration's fiscal year 2019 budget 
proposal moves away from the research and development of carbon 
capture in reducing its R&D roughly 75 percent relative to 
fiscal year 2018. And of course both in '17 and '18, the 
Congress itself has had to sort of step it up. So given the 
fossil energy R&D request as a whole was increased relative to 
the President's request of fiscal year 2018, can you explain 
why the Department shifted so dramatically from carbon capture 
R&D?
    Secretary Perry. Yes, sir. Here is my observation is that 
the fiscal year 2019 budget will not impact the current 
activities that the Department has funded up in your part of 
the world. Plain CO2 reduction, Regional Carbon 
Sequestration Partnership, that is going to continue on; a 
feasibility study on the Tundra project, that one is in that 
money stream for fiscal year 2019. The CarbonSAFE, S-A-F-E, 
activities, those are funded as well.
    Additionally, on the carbon capture issue, last year in 
about May, I was in China for the Clean Energy Ministerial and 
we were able to get CCUS placed into that. Now obviously these 
are not dollars that are going to be spent in North Dakota and 
I understand that. But I think from the standpoint of the 
commitment of the agency to the carbon capture, utilization, 
sequestration--and actually yesterday Chairman Alexander in the 
Senate was talking about being able to find obviously using our 
national labs, using our universities that we have 
relationships with a use for carbon dioxide.
    And again there is no eureka moment here, but, those are 
the exciting technologies and opportunities that we think are 
out there in the future that we are going to be looking at 
funding and, I hope you know that our commitment is very strong 
to that. Senator Hoeven, my former governor colleague, he and I 
talked at some length yesterday about the opportunities that we 
can work on together with North Dakota and DOE.
    Mr. Cramer. In my remaining seconds let me, first of all, 
strongly encourage you and invite you to North Dakota as it now 
warms up and thaws out to come and see the work at the 
University of North Dakota.
    Secretary Perry. Yes, sir.
    Mr. Cramer. Secondly, I want to ask for your assistance in 
advocating with us for the 45Q tax credit which was slightly 
improved in the most recent bill but not very useful until we 
reconcile IRS and EPA rules so that it is more useful for these 
types of projects. It is essential. And then there is another 
credit, the refined coal credit that I think just has to be 
extended so we can build this bridge again between basic 
research and commercialization. We are at the cusp and we run 
the risk of losing all those opportunities. As you said, 
innovation not regulation is our motto. I like it. Let's live 
with it. Thank you.
    Thank you, Mr. Chairman.
    Mr. Olson. Time is expired.
    Mr. Green from Texas, 5 minutes for questions. Are you 
ready, Mr. Green?
    Mr. Green. Yes, Mr. Chairman.
    I want to welcome the Secretary. My other job is I am the 
ranking member on the Health Subcommittee and we just finished 
a hearing upstairs, Mr. Secretary. And you and I have known 
each other since we could actually play basketball in the state 
capital. I want to thank Chairman Upton and Ranking Member Rush 
for having this hearing today and Secretary Perry for taking 
the time to testify with us.
    DOE has many important missions in ensuring the adequate 
funding for the agencies essential. The President's budget 
fiscal year 2019 is a 3.8 cut from the fiscal year 2018 enacted 
level. Much of these cuts hit clean energy programs, grid 
operations, and next generation energy technologies. I am 
concerned that these cuts in these programs could have grave 
consequences to the environment at a time when many nuclear 
plants are going offline. Currently, there are four planned 
deactivation of nuclear plants in Ohio and Pennsylvania which 
generate 40 million megawatts of electricity, and PJM, more 
than all the power from wind and solar combined in PJM.
    FirstEnergy Corporation recently filed a 202 request 
stating that immediate aid was needed for all coal and nuclear 
plants within PJM, not just their own. I have worked with many 
of my colleagues on this committee over the decades to updates 
to the Federal Power Act throughout the years including changes 
to the section 202(c). The current request concerns me in many 
ways. Section 202 has been used in the past for immediate 
crises from the California energy crisis in 2000 to the East 
Coast blackouts in 2003. The mechanism has historically been 
used on a short-term basis.
    At a Bloomberg event recently, when asked to define an 
emergency you responded that you flip a light switch on and 
nothing happens. I agree with that characterization. Can you 
elaborate on that quote and what is in your mind and 
constitutes an emergency that justifies the use of 202(c)?
    Secretary Perry. Yes, sir. I think the observation is a 
very simplistic one that I use, but I think it cut right to the 
core. When you have a use for your energy, whether it be a Wall 
Street financial institution, whether it be at the Federal 
Reserve and the computers that are there, whether it is on a 
military base to secure this country's liberties and freedoms, 
or if it is in your home and you have an all-electric home and 
it is a chill factor of minus 20 in the Northeast somewhere and 
you call for that power and it is not there that is an 
emergency.
    And that is exactly the point that I was trying to make in 
a very simplistic approach, but I think it did make the point 
that if you don't have this electricity, if you don't have this 
reliable source, then we have a real challenge and a real 
problem in this country and that is the reliability and the 
resiliency issue of this grid. And being able to guarantee to 
the American people that that will be there is one of our 
roles, you as a United States Congressman and me as the 
Secretary of Energy.
    So from my perspective, having a diverse portfolio is one 
of the things that we did in your home state over the course of 
the, particularly in the 2000s when they deregulated the energy 
market and we had this diverse, we developed more wind energy 
than any other state in the Nation, the gas that came online, 
the other incentives that the state, and I think Mr. Tonko was 
talking about giving states some of this responsibility and I 
totally agree with that.
    But my point is the time for study is over, again from my 
perspective. We have got to act on this because I don't want to 
wake up next winter with a polar vortex that is bigger than the 
one that we had before and having taken some nuclear plants and 
some coal plants offline and not having that energy available 
to protect the citizens' safety and/or their security.
    Mr. Green. Can you elaborate on the potential tools at DOE 
you feel could be better suited to securing a valuable 
emissions-free nuclear plants, for example?
    Secretary Perry. Yes, sir. Well, this one is going to be a 
bit of a bank shot, but I think it makes the point, Gene, that 
we are in the process of, previous administrations, not just 
the last administration but if you go all the way back probably 
20-25 years, previous administrations have not put into place, 
didn't respect the nuclear power industry. I think they 
overregulated them. They put a lot of cost on them through 
regulations. The last administration took away our ability to 
process high-assay uranium for the purposes of civil nuclear. 
That was started by the administration before the Obama 
administration but they shut that down and then the private 
sector has no place for that fuel.
    My point with all of this is we are at a critical place 
here today that if we don't send some messages whether it is 
making a good agreement with the Saudi Arabians to help them 
develop their civil nuclear program so that American 
contractors are going to have the supply chain to do that, that 
our universities don't have the incentives to put young men and 
women into the nuclear engineering field, all of that is going 
to come to a head and we are going to be at a critical position 
and I think it is sooner than we realize.
    And if we don't have a civil nuclear program that is 
robust, it will soon have an impact on our ability to keep our 
weapons programs at the place because we won't have the 
intellectual capability coming up through our national labs to 
do this. You bring up an incredibly important issue, Mr. Green.
    Mr. Green. Well, reliability is really important, like you 
said, when you turn on the light switch and they can't or the 
air conditioner or the heater, most of our problems in Texas 
when it gets real warm in the summer. Back we were joking 
yesterday, without air conditioning and elevators there would 
not be a Houston, Texas because of the heat from, literally, 
1st of May to the end of September.
    While I disagree with the recent notice of public review 
directed to FERC in the section 202 filing, I do think it is 
important we look at planned retirements across the country. 
While not rising to the level of immediate emergency, this is 
an issue both DOE and Congress should address putting forward. 
Obviously in Texas we have two nuclear power plants. Now we 
have an abundance of natural gas, and of course producing more 
wind power that was created during your administration when you 
were governor than any other State in the Union. So, and 
hopefully we will do some solar.
    But in the Northeast they don't have the ability to do that 
oftentimes with wind or solar so it is basically older 
production whether it be coal or nuclear power. And that is why 
we need to see how we can do it because those folks, we don't 
want those folks freezing in the dark. But anyway I want to 
follow what the Department of Energy does and hopefully our 
committee will work with you on making sure that reliability is 
important, but we also need to see as best we can how we get it 
done.
    Secretary Perry. Yes, sir.
    Mr. Olson. My friend's time is expired.
    I will call upon the gentleman from Oklahoma for 5 minutes 
for questions.
    Mr. Mullin. Man, Texans do stick together. No, I am 
kidding. Anyways, hey, thank you, Mr. Chairman.
    Mr. Green. Well, Mr. Chairman, Oklahoma also steals 
football players from A&M and University of Texas and my alma 
mater University of Houston.
    Mr. Mullin. No, we don't steal. We recruit better. I mean 
obviously they want to go to, you know, a climate that they can 
live in. Anyway, hey, thank you.
    And, Secretary Perry, I want to remind you of a time you 
met my son in Leader McCarthy's office. My boy wasn't very big 
at the time and he was talking to you. He was kind of like most 
little boys, he was looking around and you grabbed him by the 
shoulders and you set him on the chair and you said, young man, 
look at me in the eyes when you talk to me. And I had told my 
son that since the day he was born, and I really appreciate 
that. That meant a lot.
    Secretary Perry. I hope I did it in a very respectful way.
    Mr. Mullin. Oh, you did a hundred percent, but that is how 
we raise our kids. We are in Oklahoma too, and you look him in 
the eye and if he is not looking you in the eye I had probably 
thumped him in the head. It is just, that is called respect. So 
I appreciate that. That meant a lot to me.
    I want to talk to you obviously about Yucca Mountain and 
DOE's requirements. Can you summarize DOE's legal requirements 
pertaining to Yucca Mountain's licensing application?
    Secretary Perry. Yes, sir. This body as authorizers and the 
appropriations process has, and I think the President's budget, 
$110 million for the licensing to go forward. And I look at 
that as a way to get following the law. The law says that we 
will do this. There is an additional $10 million in that 
appropriation request for temporary storage as well.
    Mr. Mullin. Is DOE required to create the Office of Civil 
Radioactive Waste Management to manage all these activities?
    Secretary Perry. Yes, by law.
    Mr. Mullin. In your last organizational chart for DOE was 
this office included in it?
    Secretary Perry. I can't answer that. You may know the 
answer to that.
    Mr. Mullin. Yes, I do, obviously. The answer to that is no. 
And as you alluded to a while ago, you are required by law to 
have that. Can you explain maybe why it was left out?
    Secretary Perry. Well, here would be my stab at that is 
that just because it is not named and doesn't have a line item 
does not mean that its duties are not covered in the agency.
    Mr. Mullin. Do you know who is covering that then? And I 
say that because we really aren't seeing any----
    Secretary Perry. Can I get back with you and answer these 
questions after I have had some time to dig down into it and 
get you the proper answers?
    Mr. Mullin. Yes, absolutely.
    Secretary Perry. Yes.
    Mr. Mullin. Because what I am trying to fish for here is if 
it is from the appropriation process, if that is why the office 
isn't manned, if that is why the duties of that office aren't 
being done, then for the Committee's purpose we need to know 
and we need to know what is keeping it from happening. And like 
I said, if it is from the appropriation perspective we also 
need to know what it is going to take to do that.
    I think Mr. Shimkus alluded to how much it was costing the 
taxpayers right now just from the lawsuits that are taking 
place from the storage that we are supposed to taking care of 
as the United States Government and so I want to be able to 
help you. I want to work with you on it. So if you could please 
get back to my office.
    Secretary Perry. Yes, sir.
    Mr. Mullin. Let us know how we can help you because that 
was really the line of the questions what I was going to, and I 
will actually yield back the remainder of my time.
    Mr. Olson. Thank you to my friend from Oklahoma.
    Mr. Walberg, 5 minutes for questions, sir.
    Mr. Walberg. Thank you, Mr. Chairman.
    And thank you, Mr. Secretary, for always being open to be 
here and answer the questions. Thank you for the energy you put 
into being the Secretary of Energy as well. It is encouraging 
for those of us in the northern climes to know that that is 
actually happening.
    I have the privilege of representing the energy district of 
the State of Michigan. Over 30 percent of all energy produced 
in Michigan is produced in my district. It is a fleet of all-
of-the-above and some of that fleet sits right on one of the 
Great Lakes, Lake Erie, and so we are definitely concerned with 
cybersecurity. The challenge is not only that we are able to 
turn the lights on at any time but the environmental issues 
that go on thinking of the proximity there in the Great Lakes.
    You recently formed the new Cybersecurity, Energy Security, 
and Emergency Response office. I think that certainly shows 
that you believe that elevating cybersecurity functions to a 
Senate-confirmed assistant secretary level will help 
intergovernmental and interagency communications and 
multidirectional information sharing with the Department of 
Energy's ability to appropriately and quickly address cyber-
related emergencies, and I thank you for that.
    My concern is the sustainability of the Department of 
Energy's leadership on this important issue. Cybersecurity was 
not a surpassing concern back in 1977 when the Department was 
organized. It certainly is today. In my bill with my colleague 
and Ranking Member Rush, H.R. 5174, we specify functions 
related to cybersecurity and emergency response that we believe 
should be specifically led by a Senate-confirmed assistant 
secretary. Will you work with us to ensure that we can elevate 
that, Secretary, to law?
    Secretary Perry. Yes, sir.
    Mr. Walberg. I appreciate that. Over the past 7 months you 
have had a lot of experience in dealing with emergency action 
in your Department. During appearances before the Committee in 
January, your Deputy Secretary and Undersecretary for Energy 
said that expectations for DOE's emergency response exceeded 
its authorities, if I recollect correctly. From your experience 
to date, do you think there may be some additional tools or 
authorities DOE could use to help improve the ability of the 
agency's deployment of resources in an emergency?
    Secretary Perry. Yes, sir. I think it is always a 
thoughtful conversation to have to discuss with Congress and 
other agencies to make sure, we complement when we need to 
complement. But if there is a direct line of authority that it 
is very clear, very precise so that no one gets confused about 
particularly during an emergency situation who is in charge.
    Mr. Walberg. I appreciate that and we would definitely want 
to work together with you on that. We want to examine things 
like surge funding or some other mechanism to enable DOE to 
have access to resources so the Department can respond more 
rapidly. So we hope that you can work with us on that.
    Secretary Perry. Yes, sir. Thank you.
    Mr. Walberg. Thank you, Mr. Chairman. I yield back.
    Mr. Olson. The gentleman yields back.
    The gentleman from South Carolina, Mr. Duncan, for 5 
minutes.
    Mr. Duncan. Thank you, Mr. Chairman.
    And, Mr. Secretary, thank you for being here. I just want 
to lend my support at the outset here for the Nuclear Waste 
Policy Amendments Act that Chairman Shimkus and Markwayne 
Mullin from Oklahoma have mentioned. Getting Yucca Mountain 
back on track is imperative because we have a lot of waste 
sitting around this country and some of that is sitting at a 
place you visited back in February.
    And I want to thank you for visiting the Savannah River 
Site and Savannah River National Laboratory this year. SRS is 
an integral part in the Department of Energy's industrial 
complex responsible for environmental stewardship and cleanup, 
waste management, and disposition of nuclear materials, along 
with a lot of other missions, ongoing missions that Savannah 
River Site has and I thank you for recognizing the important 
role of SRS through the DOE's fiscal year 2019 budget. I 
believe it provided for about $1.7 billion, $287 million above 
enacted 2017 levels.
    I am on the Cleanup Caucus and we are concerned about 
environmental management and cleaning up the tank farms at 
sites like Savannah River Site, Hanford, and others. And the 
South Carolina Department of Health and Environmental Control 
describes the liquid waste management at SRS as the single 
greatest environmental risk in South Carolina. There are more 
than 30 years of nuclear weapons material that has been 
produced in South Carolina sitting in those tank farms and the 
ongoing environmental management efforts are there.
    We also have the ability through the Defense Waste 
Processing Facility at SRS to vitrify that high level nuclear 
waste, turn it to glass so that it no longer poses a threat to 
leakage through those tanks and into the ground and aquifers. 
So the DOE's fiscal year 2019 budget requests an additional 74 
million for SRS cleanup programs from the 2016 levels, emphasis 
on the liquid tank waste cleanup project.
    What are DOE's top cleanup priorities for the site and how 
is your particular attention as Secretary going to facilitate 
tangible cleanup progress in South Carolina?
    Secretary Perry. Obviously we have a court-mandated 
requirement that we are very sensitive to in making sure that 
we have the resources to be able to do that. We have had the 
discussion substantially over the last year since I have been 
at DOE over the issue of how to deal with the plutonium and 
clean that up.
    While I was out there I saw some good progress that is 
being made from the standpoint of the vitrification process 
that is going on there and the tanks that are going to be used 
to store that, being able to move the plutonium out of South 
Carolina. And we are already doing that with the D&D process, 
but to get that substantially more robust to be able to move 
that waste out of there on an expedited schedule is obviously 
high on our priority list, if not the highest priority there.
    Mr. Duncan. Well, I appreciate that, Mr. Secretary. And 
whether it is at Hanford with their waste facility trying to 
vitrify the waste that is coming out of their tank farms, 
ultimately this high level radioactive waste needs to go to 
Yucca Mountain and right now the vitrified waste is sitting on 
a concrete slab under a metal building at Savannah River Site. 
It is actually down in the concrete as you saw.
    Secretary Perry. Yes, sir.
    Mr. Duncan. Let me shift gears but stay at Savannah River 
Site because we have the MOX facility down there. We are under 
obligation under the Non-Proliferation Treaty with countries 
like Russia to do something with the Nation's plutonium that is 
coming out of the nonproliferation aspects and I believe the 
MOX facility at SRS is the right thing to do with that 
plutonium. Currently, we are committed to rid the world of 
about, I think, enough plutonium to make 17,000 nuclear 
weapons.
    So I would love to see the continuation of construction at 
the MOX program and eventually completion. We have already 
spent a ton of money down there and I truly believe we can 
bring more efficiency to the project and it can be completed in 
a third of time and for almost half the additional cost than 
what the NNSA predicts. You indicated in your testimony that 
the 2019 budget continues termination activities for the MOX 
but provides $220 million for use toward orderly, safe closure 
for the project. What do you envision for the future of this 
site, the MOX facility, and if not MOX, what do you determine 
to be the most efficient and effective way to remove the 
plutonium from South Carolina?
    We didn't ask for the plutonium to come there. It is stored 
on site. It is not a long-term storage facility. It was brought 
there in order to be turned into mixed oxide fuel to be used in 
nuclear reactors around the country. That is what the purpose 
was.
    Secretary Perry. Yes, sir.
    Mr. Duncan. We spent a lot of money. Where are we going 
from here?
    Secretary Perry. Yes, sir. And I will try to be as brief as 
I can. The issue on the reason that got started was an 
agreement with the Russians. The Russians have unilaterally 
walked away from that agreement. They said they would come back 
to the table if we met certain requirements and you know what 
those are, and they are unacceptable. They are asking us to do 
things that this country is not going to do to come back and 
sit down at the table.
    So the way I look at that is they have walked away and we 
have to look at our options. This is a facility that is 
obscenely over budget. And again I don't want to rehash and 
relitigate all these numbers, but the fact is there is an 
alternative and the alternative is dilute and dispose which we 
are using now as a matter of fact shipping plutonium out of 
South Carolina to WIPP at this particular point in time. We 
think that is----
    Mr. Duncan. The EPA has said that WIPP is not an acceptable 
site. Yucca might be. The thing is, Russia has walked away but 
the facts of the matter are we have plutonium sitting in South 
Carolina that has come out of that nonproliferation agreement. 
WIPP is not going to be ready. Yucca, we are struggling around 
here to fund that. MOX is absolutely the right facility and I 
would love to sit down with you and talk with you about that at 
some point.
    Mr. Chairman, thanks for the leniency and I yield back.
    Secretary Perry. You are on.
    Mr. Olson. The time is expired.
    Mr. Long, 5 minutes for questions.
    Mr. Long. Thank you, Mr. Chairman.
    And thank you, Secretary Perry, for being here today.
    Secretary Perry. Yes, sir.
    Mr. Long. Texas A&M University, where is that located?
    Secretary Perry. Where is it located?
    Mr. Long. Yes.
    Mr. Olson. College Station, Texas.
    Secretary Perry. It is, some would say that----
    Mr. Long. I don't believe I yielded to you, did I?
    Secretary Perry. Some would say it is of the epicenter of 
the world, but we will just leave it at it is in Brazos County, 
Texas.
    Mr. Long. College Station, Texas?
    Secretary Perry. In the city of College Station.
    Mr. Long. And that is the only campus?
    Secretary Perry. No, sir. It is the main campus.
    There are----
    Mr. Long. I didn't ask you about the main campus. I said 
where is it located?
    Secretary Perry. Oh, it is in College Station, Texas on 
Highway 6 and it goes both ways.
    Mr. Long. That is the only campus?
    Secretary Perry. It is the only main campus.
    Mr. Long. Where are the other campuses?
    Secretary Perry. The other campuses are----
    Mr. Long. Outside of this country, I will cut to the chase.
    Secretary Perry. They are in a lot of different places. 
John Dalton----
    Mr. Long. Like Qatar?
    Secretary Perry. And there is one in the country of Qatar 
right out of Doha.
    Mr. Long. I was in Qatar 10 days ago.
    Secretary Perry. Yes, sir.
    Mr. Long. And walked in and they are all Aggie there, trust 
me.
    Secretary Perry. Sure.
    Mr. Long. They are very, very happy with their affiliation 
and the students are doing great. Your picture was right there 
on the wall as I walked in and they are Aggie through and 
through. So I was pleased to see your picture on the wall when 
we went in and toured Texas A&M in Qatar just the other day.
    Speaking of universities, I would like to speak about 
another university. In recent hearings with your senior 
Department of Energy leadership I asked about the Department of 
Energy's support of the University of Missouri's MURR Nuclear 
Reactor. The MURR reactor trains nuclear engineers, some of who 
are funded through Department of Energy's Nuclear Energy 
University Program.
    Private companies in coordination with the University are 
seeking approval to produce lifesaving medical isotopes in 
partnership with the National Nuclear Security Administration, 
NNSA. And the University is currently studying a partnership 
with the NNSA to convert the reactor to use low-enriched 
uranium instead of highly enriched uranium or HEU. I have got 
to tell you I was disappointed to see that the Integrated 
University Programs were defunded in your fiscal year 2019 
budget, but I hope you see the value in these activities as we 
do at the University of Missouri.
    Will you please talk about the importance of our nuclear 
research infrastructure and how the Department of Energy 
supports this critical work particularly in its university 
programs?
    Secretary Perry. Yes, sir. I think you are making reference 
to the research reactor there at the University of Missouri and 
it is in medical isotopes and the manufacture of medical 
isotopes and there are a number of places across the country 
that we are partnering with that. It is for precision medicine 
for some of the things that we talked about with Mr. McNerney. 
On our ability to practice precision medicine these facilities 
are really going to be important.
    Mr. Long. They are very important.
    Secretary Perry. We want to work with you and----
    Mr. Long. All right, thank you. With the ever-increasing 
cyber threats to the grid, I am pleased that the steps have 
been taken to create CESER, the Office of Cyber-, Energy 
Security, and Emergency Response and I look forward to that 
office getting up and running. In your opinion, since your 
confirmation has the electric grid become more or less 
responsive to cybersecurity threats?
    Secretary Perry. Well, I think the threat has increased but 
that shouldn't shock anyone. I think the threat potential is 
greater today than it was a year ago. Are we more resilient? I 
can't answer that with great definition. What I think is that 
we are exposed in certain areas. We need to be all hands on 
deck. That is the reason we are asking for the cyber office to 
be stood up.
    With that said, our national labs are making some, I think, 
good inroads in both the defensive and offensive ways to deal 
with those that would attack our electrical grid.
    Mr. Long. Let me ask you one more question and I will be 
about out of time at the end of this probably, but the fiscal 
year 2019 budget calls for $96 million in funding for the 
CESER, or for CESER. Can you explain a little bit about the 
program and how this money will be used to ensure we are 
securing our grid from the continuous cyber threats that we 
face?
    Secretary Perry. Well, the focus is on the cyber threats 
from both state actors, and we are talking about a year ago, 
Russia with Petya. We saw the impact on that. We have seen what 
has happened in Ukraine with two attacks on their power grid. 
The Iranians are who attacked the Aramco Electrical or their 
control panels. So nation state attacks are very real. As late 
as this last week we had conversations about, what can we 
expect with the Syrian issue. Should we be on more heightened 
alert? And I would suggest to you yes.
    So the issue is this Office of Cybersecurity, our national 
labs working with the private sector, working with 
universities, I don't think it has ever been more important for 
us to be able to maintain the national security of this country 
relative to our grid, both as we have talked about at length 
here today about the resources to be able to keep the power to 
that grid, but also to protect that grid from cyber attacks is 
as important as it has ever been in our country's history.
    Mr. Long. Thank you. And thanks for being here today. It 
has been a long hearing and I am sure you are kind of tired. 
And I yield back.
    Mr. Olson. Time is expired.
    The gentleman from Massachusetts has 5 minutes for 
questions, Mr. Kennedy.
    Mr. Kennedy. One more to go, Mr. Secretary. Thank you. 
Thank you for your patience. Thank you for spending so much 
time with us and I will echo the comments of our colleagues, 
thank you for being so accessible, grateful that you are here.
    As our nation makes the transition from a 20th to 21st 
century energy economy we know that innovative sources of power 
will be an important part of that generation mix. Wind power is 
a steadily growing portion of the energy sector that provides 
clean power to millions of Americans and creates thousands of 
jobs across our country. Your home State of Texas, Mr. 
Secretary, during your tenure as governor wind power resources 
and energy grew by leaps and bounds. It is my understanding 
that according to ERCOT, wind made up 17 percent of the fuel 
mix in 2017.
    So I wanted to ask you, I think, a pretty general question 
to start. Do you agree, Mr. Secretary, that wind energy is an 
important part of our nation's power sector?
    Secretary Perry. Yes, sir.
    Mr. Kennedy. So despite this growth, and I appreciate the 
answer, we have only one offshore wind project coming online in 
the United States. Other nations such as the U.K, Germany, and 
China have developed these projects in their own waters. My 
home State of Massachusetts proposes to be a leader in this 
effort. In my district we have made significant investments in 
Fall River and in Dartmouth and just across the border, the 
district in New Bedford, to become a national leader in 
offshore wind. Just recently, the Department of Interior 
announced proposed sales of two areas off the coast of 
Massachusetts to develop offshore wind.
    Yet, unfortunately, Mr. Secretary, America risks being left 
behind as our allies and peers lead the growth of an industry 
that remains largely dormant here despite the potential to 
boost the economy and create jobs. Even more concerning, I know 
you have already touched on this a bit, is this year's budget 
request from the Trump administration that included a 72 
percent cut in the DOE Office of Energy Efficiency and 
Renewable Energy.
    I am not going to make you comment on that again. I think 
you have been pretty clear about where you stand on that cut. 
But I do want to ask you how DOE is going to continue to 
support research and development of offshore wind.
    Secretary Perry. Mr. Kennedy, we discussed, this is an 
industry that is becoming mature. And so the private sector, 
the states, if, in my home state one of the reasons we had that 
big wind energy growth was that the state invested in the CREZ 
lines. We didn't subsidize the specific projects, but we 
basically said we are going to build these lines if you all 
will commit to building all these farms out. They did and you 
know what the results are. So I think not only the state but 
the private sector has the place to play this.
    Here is what I will tell you that the DOE is going to 
continue to play a role in this, this is important. And again 
we were in Livermore this last week and the technology that is 
coming out of there, and this is on again rotor technology that 
makes these turbines substantially more efficient so that, then 
that gets commercialized and goes into the private sector where 
it makes it even more of a commercialized product in the market 
and more competitive.
    Mr. Kennedy. More viable.
    Secretary Perry. So my point is we are going to continue to 
be a partner, maybe not as big as we were when wind and solar 
was more in its infancy, we are shifting over to batteries and 
beyond battery to hydrogen fuels and some of the more immature 
but may have great potential energy sources in the future. So I 
am a big believer in wind and I hope that Massachusetts and 
other states that want to see a diverse portfolio, I don't 
think it is a good idea to have Russian molecules of gas in 
Boston Harbor. But if you can't get it from the West you are 
going to get it from somewhere and I think that is another 
debate or discussion that we can have into the future about how 
we make sure that this entire country has got an infrastructure 
that will allow for all of our citizens to enjoy this energy 
revolution that is occurring in America.
    Mr. Kennedy. And, Mr. Secretary, I appreciate that. I would 
agree with you it obviously gets complex as you try to look at 
the local resources and the voices of the local community. We 
do have a vibrant local community that is, I think, ready and 
willing to make this investment in coordination with our 
Federal Government partners, DOI, DOE, and I would ask just for 
you to keep it on your radar and as we to be a partner as we 
have seen and as we saw under your stewardship in Texas to see 
the growth of wind industry there.
    Just to finish this to make sure that the point is clear 
and I think it is, in 2017 the Clean Energy States Alliance, a 
coalition of state energy agencies, released three reports on 
the future of offshore wind in the Northeast, the reports which 
were actually partially funded by DOE that projected that 
offshore wind projects in the Northeast have the potential to 
add more than 35,000 jobs in the region.
    My colleagues, Niki Tsongas and Bill Keating, just 
introduced a bill that would create a grant program to support 
offshore wind job training including partnerships with colleges 
and universities and nonprofits and unions and local 
governments. Investment in that wind energy is more than just a 
clean energy future especially in my district, sir. It 
represents jobs, economic development, opportunity, education, 
and a whole new industry base and expertise that is homegrown.
    I know the DOE mission is to ``ensure America's energy 
security and prosperity by addressing its energy, 
environmental, and nuclear challenges through transformative 
science and technological solutions.'' So I would hope that you 
would continue to focus on how we can partner with you, 
understanding there has got to be a private sector component to 
this and a state component to this.
    Secretary Perry. Yes, sir.
    Mr. Kennedy. But I think we have seen there is a 
willingness to do so and we are going to need your help.
    Secretary Perry. And, Mr. Kennedy, one of the things that I 
will offer you and to make the introduction, the university in 
Texas that probably has as good of wind energy history and 
experience and expertise is Texas Tech in Lubbock, Texas. And 
getting the states to work with each other that may be a great 
opportunity. There used to be a real good Boston to Austin 
connectivity so Boston to Lubbock might be OK too.
    Mr. Kennedy. I appreciate that, sir. As long as we aren't 
talking football we are in good shape.
    Secretary Perry. Yes, sir.
    Mr. Kennedy. Thank you, sir.
    Mr. Olson. Time has expired.
    Seeing that no further members wishing to ask questions, I 
would like to thank Secretary Perry for coming this afternoon. 
And I trust, sir, that the proceedings you talked with before 
did not happen here today. You know what I am talking about, 
correct?
    Secretary Perry. That is correct.
    Mr. Olson. And you are cleared now to depart the pattern 
with a proud, loud Aggie whoo.
    And before we conclude I would like to ask unanimous 
consent to submit the following documents for the record: 
Letters from the Utilities Technology Council; a statement from 
the R Street Institute; three letters to the President from 
Members of Congress; a letter to the President from the 
International Brotherhood of Teamsters; a letter to the 
President from United Mine Workers of America; a letter to the 
President from the International Brotherhood of Boilermakers, 
Iron Shipbuilders, Blacksmiths, and Forgers and Helpers; a 
letter to the President from the Utility Workers Union of 
America; a letter to Secretary Perry from the Energy Industry 
Trade Association; a letter to Secretary Perry from the 
Pennsylvania Public Utility Commission; a letter to Secretary 
Perry from FirstEnergy \*\; a response letter from PJM to 
Secretary Perry; a letter from NEI to Chairman Walden.
    Without objection, so ordered.
    [The information appears at the conclusion of the hearing.]
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    \*\ The information has been retained in committee files and can be 
found at: https://docs.house.gov/meetings/IF/IF03/20180412/108114/HHRG-
115-IF03-20180412-SD049.pdf.
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    Mr. Olson. Pursuant to committee rules, I remind members 
that they have 10 business days to submit additional questions 
for the record and ask that the witnesses submit their response 
within 10 business days upon receipt of the questions. Without 
objection, the subcommittee is adjourned.
    [Whereupon, at 1:21 p.m., the subcommittee was adjourned.]
    [Material submitted for inclusion in the record follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

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