[House Hearing, 116 Congress]
[From the U.S. Government Publishing Office]


                 SOLVING THE CLIMATE CRISIS: MANUFACTURING 
                       JOBS FOR AMERICA'S WORKERS

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

                                HEARING

                               BEFORE THE

                        SELECT COMMITTEE ON THE
                             CLIMATE CRISIS
                        HOUSE OF REPRESENTATIVES

                     ONE HUNDRED SIXTEENTH CONGRESS

                             FIRST SESSION

                               __________

                              HEARING HELD
                           SEPTEMBER 10, 2019

                               __________

                            Serial No. 116-9

[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]

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   Printed for the use of the Select Committee on the Climate Crisis
   
   
                              __________
                               

                    U.S. GOVERNMENT PUBLISHING OFFICE                    
38-471                      WASHINGTON : 2020                     
          
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                 SELECT COMMITTEE ON THE CLIMATE CRISIS
                     One Hundred Sixteenth Congress

                      KATHY CASTOR, Florida, Chair
BEN RAY LUJAN, New Mexico            GARRET GRAVES, Louisiana,
SUZANNE BONAMICI, Oregon               Ranking Member
JULIA BROWNLEY, California           MORGAN GRIFFITH, Virginia
JARED HUFFMAN, California            GARY PALMER, Alabama
A. DONALD McEACHIN, Virginia         BUDDY CARTER, Georgia
MIKE LEVIN, California               CAROL MILLER, West Virginia
SEAN CASTEN, Illinois                KELLY ARMSTRONG, North Dakota
JOE NEGUSE, Colorado

                              ----------                              

                Ana Unruh Cohen, Majority Staff Director
                  Marty Hall, Minority Staff Director
                        climatecrisis.house.gov
                           
                           
                           C O N T E N T S

                              ----------                              

                   STATEMENTS OF MEMBERS OF CONGRESS

                                                                   Page
Hon. Kathy Castor, a Representative in Congress from the State of 
  Florida, and Chair, Select Committee on the Climate Crisis:
  Opening Statement..............................................     1
  Prepared Statement.............................................     3
Hon. Garrett Graves, a Representative in Congress from the State 
  of Louisiana, and Ranking Member, Select Committee on the 
  Climate Crisis:
  Opening Statement..............................................     3
Hon. Ben Ray Lujan, a Representative in Congress from the State 
  of New Mexico, and Member, Select Committee on the Climate 
  Crisis:
  Prepared Statement.............................................     5

                               WITNESSES

Josh Nassar, Legislative Director, United Auto Workers
  Oral Statement.................................................     6
  Prepared Statement.............................................     8
Tarak Shah, Former Chief of Staff and Under Secretary for 
  Secretary and Energy, U.S. Department of Energy
  Oral Statement.................................................    11
  Prepared Statement.............................................    13
Edward Stones, Global Business Director, Energy and Climate 
  Change, Dow
  Oral Statement.................................................    19
  Prepared Statement.............................................    20
Zoe Lipman, Director, Vehicles and Advanced Transportation 
  Program, BlueGreen Alliance
  Oral Statement.................................................    25
  Prepared Statement.............................................    27

                       SUBMISSIONS FOR THE RECORD

Report, Taking the High Road: Strategies for a Fair EV Future, 
  submitted for the record by Ms. Castor.........................    46

                                APPENDIX

Questions for the Record from Hon. Kathy Castor to Josh Nassar...    52
Questions for the Record from Hon. Kathy Castor to Tarak Shah....    52
Questions for the Record from Hon. Ben Ray Lujan to Tarak Shah...    55
Questions for the Record from Hon. Mike Levin to Tarak Shah......    56
Questions for the Record from Hon. Kathy Castor to Edward Stones.    56
Questions for the Record from Hon. Kathy Castor to Zoe Lipman....    57
Questions for the Record from Hon. Mike Levin to Zoe Lipman......    62

 
  SOLVING THE CLIMATE CRISIS: MANUFACTURING JOBS FOR AMERICA'S WORKERS

                              ----------                              


                      TUESDAY, SEPTEMBER 10, 2019

                          House of Representatives,
                    Select Committee on the Climate Crisis,
                                                    Washington, DC.
    The committee met, pursuant to call, at 2:06 p.m., in Room 
1334, Longworth House Office Building, Hon. Kathy Castor 
(chairwoman of the committee) presiding.
    Present: Representatives Castor, Bonamici, Brownley, 
Huffman, Levin, Casten, Graves, Griffith, Palmer, Carter, and 
Miller.
    Ms. Castor. The committee will come to order. Without 
objection, the chair is authorized to declare a recess of the 
committee at any time.
    Today, we will discuss expanding job opportunities for 
America's workers in clean vehicle and clean energy technology 
manufacturing. As we transition to a low carbon economy, we 
need to make sure that the tools for that transition, such as 
electric vehicles, energy efficient products, and wind turbines 
are made right here in the good old USA.
    I now recognize myself for 5 minutes for an opening 
statement.
    First of all, I would like to say welcome back to 
Washington, everyone. This is going to be a busy week when it 
comes to climate action. We have a number of votes this week on 
the floor of the House to ban dangerous offshore oil drilling, 
to protect the Arctic Refuge. I believe it is Mr. Huffman's 
bill that was voted on last night to clean up diesel pollution, 
and to boost energy efficiency.
    And our committee is ramping up its work as well. We just 
released a public request for information, which you can find 
on our website at climatecrisis.house.gov. The committee is 
soliciting scientifically based proposals to reduce carbon 
emissions and to build more resilient communities across 
America. We want to hear your ideas. We want to hear from 
experts and advocates so that we can help--so that you all can 
help build our congressional climate action plan that will be 
released in the coming months.
    Of course, I wish Representative Carter was here, because 
we really were thinking about him and his coastal Georgia 
district as Hurricane Dorian strengthened and charted its 
destructive path. Hurricane Dorian is just the latest reminder 
of the need for solutions that reduce carbon pollution and 
prepare our communities for the growing dangers of the climate 
crisis. Our neighbors on the East Coast are recovering from 
Hurricane Dorian, and the climate refugees fleeing the Bahamas 
right now need our support.
    But I hope everyone had a productive August work period. I 
am grateful to Congressman Neguse who hosted our first field 
hearing in Boulder, Colorado. I think Rep. Graves would agree 
it was a fascinating time, especially at the National Renewable 
Energy Lab, and to hear from experts from that community that 
are right in the heart of coming up with solutions to tackle 
the climate crisis. So I am grateful to Rep. Neguse.
    Last month, I also got to visit Representative Casten in 
the Chicago area. He hosted me to talk about climate resilience 
and clean energy in Illinois. And then I went to Detroit and 
Dearborn, Michigan, to learn more about the transition to 
electric vehicles. I saw the latest cutting-edge technology at 
Ford and at General Motors, and what that means for the auto 
industry, for workers, and their communities. It was a 
fascinating trip.
    And one of the things I kept hearing on these trips is that 
people see addressing the climate crisis as an opportunity to 
lead the world in new technologies and create millions of new 
jobs, but they also want them to be the kind of quality, family 
sustaining jobs that build the American middle class.
    There used to be about 20 million manufacturing jobs in 
America. That was 1979. Today, there are only 12.4 million 
manufacturing jobs in the United States. So pursuing policies 
that create jobs while providing solutions to the climate 
crisis are critical. Meeting the Paris climate goals means we 
are going to see a $23 trillion clean energy market emerge 
between now and 2030. So we have a choice: We can build on 
America's competitive edge in innovation, we can help America's 
workers tap into that market, or we could let China eat our 
lunch. I think we will all choose the former. That is why we 
are here.
    When Congress passed the Recovery Act, we provided $88.5 
billion in funding to clean energy businesses. That funding 
supported 100,000 clean energy projects and provided hundreds 
of thousands of jobs for American workers. And we can do more, 
much more. We need millions of workers to design, build, and 
manufacture wind turbines, solar panels, electric cars, new 
mass transit, energy efficient projects, and new industrial 
facilities.
    But last month, we actually saw the manufacturing sector 
contract for the first time since 2009. But when we have a 
President who denies climate change, who thinks that wind 
turbines cause cancer, and who undermines consumers and 
businesses by undoing energy saving rules for cars and light 
bulbs, America is missing out on a huge economic opportunity. 
And we can't stand for that.
    We need to pass long-term policies that support 
manufacturing in America. Clean energy technology should move 
from American labs to American production facilities to the 
enormous global market that will be willing to pay top dollar 
for innovative solutions to the climate crisis. I believe we 
can do this. I know we can do this. We must do this.
    I look forward to hearing from our witnesses on how we can 
make a prosperous clean energy future a reality for American 
workers. Thank you.
    And I yield 5 minutes to the ranking member.
    [The statement of Ms. Castor follows:]

              Opening Statement (As Prepared for Delivery)

                    Rep. Kathy Castor (D-FL), Chair

           U.S. House Select Committee on the Climate Crisis

  Solving the Climate Crisis: Manufacturing Jobs for America's Workers

                           September 10, 2019

    I'm glad to see everyone back in Washington. We have a number of 
climate action votes on the House floor this week to ban dangerous 
offshore drilling, protect the Arctic Refuge, clean up diesel 
pollution, and boost energy efficiency.
    Our committee is also ramping up its work. We just released a 
public request for information, which you can find on our website--
climatecrisis.house.gov. We want to hear your ideas and your 
recommendations for our Congressional climate action plan.
    Hurricane Dorian is just the latest reminder of the need for 
solutions that reduce carbon pollution and prepare our communities for 
the growing dangers of the climate crisis. Our neighbors on the East 
Coast recovering from Hurricane Dorian and the climate refugees fleeing 
the Bahamas right now need our support.
    I hope everyone had productive visits back to their districts. Last 
month, I also got to visit some of our colleagues in their districts. 
Representative Casten hosted me to talk about climate resilience and 
clean energy in Illinois. And I also went to Detroit to learn more 
about what the transition to electric vehicles means for the auto 
industry, workers and their communities.
    One thing I kept hearing on these trips is that people see 
addressing the climate crisis as an opportunity to lead the world in 
new technologies and create millions of new jobs. But they also want 
them to be the kind of quality, family-sustaining jobs that built the 
American middle class.
    There used be about 20 million manufacturing jobs in America. That 
was in 1979. Today, there are only 12.4 million manufacturing jobs in 
the United States. Pursuing policies that create jobs while providing 
solutions to the climate crisis will be critical.
    Meeting the Paris climate goals means we're going to see a $23 
trillion-dollar clean energy market emerge between now and 2030. So we 
have a choice. We can build on America's competitive edge in 
innovation. We can help American workers tap into that market. Or we 
can let China eat our lunch.
    When Congress passed the Recovery Act, we provided $88.5 billion in 
funding to clean energy businesses. That funding supported 100,000 
clean energy projects and provided hundreds of thousands of jobs for 
American workers.
    We can do more--much more. We need millions of workers to design, 
build, and manufacture wind turbines, solar panels, electric cars, new 
mass transit, energy efficient products, and state-of-the-art 
industrial facilities.
    But last month we actually saw the manufacturing sector contract 
for the first time since 2009. When we have a president who denies 
climate change, who thinks that wind turbines cause cancer, and who 
undermines consumers and businesses by undoing energy saving rules for 
cars and light bulbs, America is missing out on a huge economic 
opportunity.
    We need to pass long-term policies that support manufacturing in 
America. Clean energy technology should move from American labs to 
American production facilities to the enormous global market that will 
pay top dollar for innovative solutions to the climate crisis.
    I believe we can do this. And I believe we must do this. I look 
forward to hearing from our witnesses on how we can make a prosperous 
clean energy future a reality for American workers.

    Mr. Graves. Thank you, Madam Chair. And I also want to 
thank Mr. Neguse and those of you that had the opportunity to 
come to Colorado. The National Renewable Energy Lab was 
fascinating. It was. I could stay there for days, I think, and 
meet with those folks. It really was an impressive trip. And, 
of course, the other facilities, the UCAR facility, the ESRL 
facility and others in Colorado were all great, the ones that I 
had the chance to attend, but I did have to miss a few. But 
thanks again for hosting that hearing over there.
    So today, we are talking about manufacturing jobs and the 
concept here is that if you create a new sector, if you create 
a new industry, that perhaps you have hundreds of thousands or 
millions of jobs in economic activity that go along with it. 
But as I said in the Boulder hearing, we have got to get it 
right, but we have got to get it right. And part of that 
getting it right is being very thoughtful about the policies 
that we are carrying out to ensure that the policies are truly 
benefiting the United States.
    Now, the chair brought up some of the bills that are on the 
floor this week. And this is a perfect example of where 
policies are not thought out, that are actually going to 
undermine the very intent of the objectives they are purported 
to advance. And I will talk about this all day long, and my 
friend, Mr. Huffman, I will--I will have a discussion with you 
or anybody else about this.
    So, for example, this week, we are pushing legislation 
affecting Alaska, the Gulf of Mexico, and the Atlantic that 
prevent energy production in the United States. When this was 
attempted previously, when policies were pushed to stop energy 
production, what happened was that we simply--we didn't stop 
using oil and gas; we just imported more from other countries. 
And so what it did is it created jobs in other countries. It 
caused us to export dollars and, effectively, jobs to other 
countries.
    And so while I do share the chair's optimism and objectives 
to ensure that we provide clean energy solutions for Americans, 
I think we also have to be very thoughtful about the policies. 
California stopped trying to count the green jobs--article in 
Politico just recently--they stopped trying to count green jobs 
that were being created. In fact, the article goes through and 
undermines some of the Presidential candidates' assertion on 
job numbers, because they were unable to tease out or determine 
which jobs were created as a result of this green economy 
versus jobs that were otherwise created.
    Much of the energy technologies that we have developed 
right here in our energy labs in the United States have been 
pirated by other countries, especially China, taking, stealing 
our intellectual property, then turning around and selling it 
to us, undermining the very innovators that came up with these 
ideas, these concepts, and in many cases, shuddering these 
domestic businesses.
    For example, Tesla recently announced that they are opening 
up a manufacturing facility in China as opposed to 
manufacturing vehicles only in the United States, giving us the 
chance to export vehicles to China. In Mr. Stones' testimony, 
he talks about how, in 1997, we actually had a $19 billion 
trade surplus in the chemical sector that ended up flipping 
because of, I assume, policies that were not properly thought 
out, resulted in the loss of 200,000 jobs in the United States.
    And so many cases, efforts that are attempting to create 
jobs, result in the complete opposite. And, in fact, even in 
the committee memo briefing us for this hearing, it talks about 
the fact that converting or transitioning to electrical 
vehicles results in mining in China, which, of course, isn't 
good for the environment. I believe there was a study that was 
recently done that found that for every 1 pound of battery, you 
have 50 to 100 pounds of mining activities.
    And so we need to be very thoughtful and ensure that the 
policies that we are advancing are creating jobs, not just 
anywhere, but right here in the United States, making sure that 
we are advancing efforts to improve our environment, helping to 
reduce greenhouse gas emissions, helping to ensure the 
competitiveness of the U.S. economy, helping to ensure 
competitive energy prices, and ensuring that we are not simply 
creating jobs in other countries as opposed to in the United 
States. And that, I think that there are many, many examples we 
could cite, including the one cited in Mr. Stones' testimony, 
that indicate that we could be making the wrong decisions in 
some cases.
    So with that, Madam Chair, looking forward to witness 
testimony. I do want to make note that we have an aviation 
briefing on NextGen that was scheduled weeks ago that I do need 
to head over to, but I am going to try and participate in as 
much as I can here.
    Thank you. I yield back.
    Ms. Castor. Thank you.
    Without objection, members who wish to enter opening 
statements into the record may have 5 business days to do so.

                       Submission for the Record

                      Representative Ben Ray Lujan

                 Select Committee on the Climate Crisis

                           September 10, 2019

    The manufacturing sector is the lifeblood of the American economy--
responsible for nearly 13 million American jobs. These represent good-
paying jobs and economic growth that directly benefit working 
Americans. Consider that for every $1.00 we spend on manufacturing, 
$1.82 is added to the economy. Clearly, this is an industry that must 
be healthy for the economy to grow.
    Still, according to the EPA, the manufacturing sector is 
responsible for approximately a quarter of the nation's greenhouse gas 
emissions. This means that when Congress looks at addressing the 
climate crisis, Congress must look at how the manufacturing sector can 
innovate and evolve to reduce greenhouse gas emissions while 
maintaining competitiveness.
    Unfortunately, since the most recent recession, we have not seen 
manufacturing jobs bounce back as happened after previous economic 
downturns. And this slow recovery has only been made worse by this 
administration's disastrous trade policy. Congress must do more to 
ensure our manufacturing sector is resilient.
    Fortunately, these is a solution that is both green and supports 
working Americans. Within in the work of this Committee, we have a 
great opportunity to revive our manufacturing industry through 
sustainability.
    Countries all over the world are looking at how they can address 
the climate crisis, and when it comes to manufacturing, they are going 
to need the right technologies. To meet this rising demand for 
sustainable industry, we must step up as a Country and do what we do 
best--innovate. And that leads to the creation of good, homegrown 
American jobs that support a sustainable manufacturing industry.
    I appreciate the leadership of my colleague Representative Casten, 
who is leading the bipartisan, bicameral Clean Industrial Technology 
Act of 2019 which aims to do just that.

    And with that, at this time I would like to welcome our 
witnesses.
    First, Josh Nassar, is the legislative director for the 
United Autoworkers and is responsible for implementing the 
union's policy agenda and legislative strategy. Previously, Mr. 
Nassar was the assistant legislative director for the Service 
Employees International Union.
    Tarak Shah is an energy policy consultant who has worked on 
Federal clean energy and climate policy. From 2014 to 2017, Mr. 
Shah served as the chief of staff and senior adviser to the 
Under Secretary for Science and Energy at the U.S. Department 
of Energy. Prior to his time at DOE, he served as special 
assistant to the Assistant Secretary of Defense for Operational 
Energy Plans and Programs at the United States Department of 
Defense.
    Edward Stones is the global business director, Energy and 
Climate Change, for the Dow Chemical Company, and leads Dow's 
energy conservation and greenhouse gas reduction efforts. Since 
1997, Mr. Stones has held several roles in manufacturing, 
finance, business development, and investor relations.
    And Zoe Lipman directs the Vehicles and Advanced 
Transportation Program for the BlueGreen Alliance. Prior to 
joining BGA, Ms. Lipman led the National Wildlife Federation's 
program on fuel economy and electric vehicles.
    Welcome.
    Without objection, the witnesses' written statements will 
be made part of the record.
    With that, Mr. Nassar, you are now recognized to give a 5-
minute presentation of your testimony.

 STATEMENTS OF JOSH NASSAR, LEGISLATIVE DIRECTOR, UNITED AUTO 
WORKERS; TARAK SHAH, FORMER CHIEF OF STAFF, UNDER SECRETARY FOR 
 SCIENCE AND ENERGY, U.S. DEPARTMENT OF ENERGY; EDWARD STONES, 
 GLOBAL BUSINESS DIRECTOR, ENERGY AND CLIMATE CHANGE, DOW; AND 
  ZOE LIPMAN, DIRECTOR, VEHICLES AND ADVANCED TRANSPORTATION 
                  PROGRAM, BLUEGREEN ALLIANCE

                    STATEMENT OF JOSH NASSAR

    Mr. Nassar. Thank you very much, Chairwoman Castor, Ranking 
Member Graves, and members of the select committee for this 
opportunity. I am proud here to speak on behalf of the 1 
million members and retirees of the UAW.
    There is no membership organization that cares and has more 
direct consequences from the decisions made here in the auto 
industry than our members. So these issues are extremely 
important to us.
    I first want to talk about the quality of auto jobs that we 
see right now. We are proud of the fact and our members are 
proud of the fact that we really help establish manufacturing 
jobs that can be middle-class jobs, and countless families are 
able to retire in dignity, you know, and earn a good living 
through manufacturing for many decades. Unfortunately, that is 
less and less the case today.
    We have seen over the past 15 years adjusted for inflation 
that actually wages have dropped by more than 20 percent for 
both auto assembly and for parts. Twenty percent--over 20 
percent. So, for us, when we are looking at what is going on, 
we first have to acknowledge that we have a lot of work to do 
with the auto jobs that exist right now, and I think, you know, 
there are many reasons for that.
    I think, you know, many of these reasons are not directly 
related to this committee, but I would say they include trade 
policies that really, you know, reward offshoring of jobs, same 
with tax policies and such, and also antilabor policies. We 
really have weak labor laws, and our labor laws need to be 
strengthened. So those are some of the factors.
    So what are we going to do here and how is this relevant to 
this work of this select committee? So I think, first of all, 
we have to get ahead of the curve, and the reality is, is that 
the entire globe is going towards more efficient vehicles, and 
we have to stay competitive within that race.
    I think for us, we look at the, you know, the proposal that 
is put forward, the preferred alternative by the administration 
on CAFE GHG standards, and we think that is a step backwards. 
We urge the administration to not move forward with the 
preferred alternative because we really think that standards 
have a role to play because they really encourage investment 
and they also keep the industry moving ahead. And what we can 
see is that many, many jobs have actually been created because 
of this.
    So, for us, I mean, there are a few other things. One is 
that the transition to EVs is important. It is going to take 
time. Right now, EVs and plug-ins are 2 percent of the market 
right now. So we have a chance to do this in a thoughtful way, 
and the reality is that there are going to be lost jobs from 
this transition, because the traditional engine, you know, 
requires quite a bit of work and a fair amount of jobs will be 
lost.
    So what are we going to do to make sure that the jobs for 
the batteries and all the new technologies are made in the 
U.S.? Right now, we are not doing a whole lot to make sure that 
is the case. And according to experts, it is supposed to be 
that more and more of the production is going to go to China 
over the next few years, and projections are that only roughly 
14 percent within a few years will be manufactured in the 
United States. It is a very small percentage.
    We have also seen some investments by auto companies in 
next generation vehicles, but there has also been offshoring of 
them. There have been announcements of moving EV production 
from--you know, from General Motors and other manufacturers. So 
that is a problem.
    The reality is that we can't have a situation anymore where 
we are just relying on the corporate sector to invest in 
America and ensure that those new jobs are made here. We are 
going to need proactive policy. We are going to need trade 
policies that really look to, you know, enhance those 
technologies. We are also going to need to move our, you know, 
environmental policy forward, and we really have to make sure 
that there are conditions where, if companies are getting tax 
breaks for, let's say, electric vehicles, we want to make sure 
those are good jobs and they are jobs that are right here in 
the United States.
    So there is a lot of work to do. We look forward to working 
with this committee. And because this is a race that we can't 
afford to lose, I think it is very important that we focus on 
solutions today.
    And I really appreciate this opportunity. Thank you very 
much. Look forward to answering your questions.
    [The statement of Mr. Nassar follows:]

                        Testimony of Josh Nassar

                       Legislative Director, UAW

   Before the U.S. House of Representatives, Select Committee on the 
                             Climate Crisis

  Solving the Climate Crisis: Manufacturing Jobs for America's Workers

                           September 10, 2019

    Madam Chair Castor, Ranking Member Graves and members of the Select 
Committee on the Climate Crisis, today I will testify on behalf of the 
one million active and retired members of the International Union, 
United Automobile, Aerospace, and Agricultural Implement Workers (UAW). 
Thank you for the opportunity to share our views on this important 
topic. It is an honor to speak before this distinguished committee.
    Today, I will focus on the automotive sector and its impact on 
workers, the environment, and our economy at large.
                  the state of u.s. auto manufacturing
    No other membership organization in the United States is more 
directly impacted by the health and stability of the domestic auto 
manufacturing industry than UAW members and retirees. The majority of 
our members and retirees work in or have retired from the auto 
industry. Changes in the industry and proposals to combat climate 
change have real life consequences for manufacturing workers, retirees, 
and their families.
    The United States' motor vehicle industry is the cornerstone of 
American manufacturing jobs. Nearly one million people work in the auto 
and auto-parts manufacturing sectors.\1\ Of course, the economic impact 
of the auto industry reaches far beyond the workers employed at the 
plants and their families. The domestic vehicle assembly and parts 
industries are vital to our manufacturing base and it is imperative 
that we stay strong and competitive now and into the future. When jobs 
from other linked industries are included, the auto industry is 
responsible for over seven million jobs nationwide.\2\ The long-term 
health of the industry is critically important to both workers and the 
economy at large.
---------------------------------------------------------------------------
    \1\ Bureau of Labor Statistics, ``Automotive Industry: Employment, 
Earnings, and Hours,'' https://www.bls.gov/iag/tgs/iagauto.htm.
    \2\ Hill, Kim, Deb Menk, Joshua Cregger, and Michael Schultz. 
``Contribution of the Automotive Industry to the Economies of All Fifty 
States and the United States.'' Center for Automotive Research. January 
2015.
---------------------------------------------------------------------------
             employment standards in the u.s. auto industry
    UAW members are proud of their important role in creating middle 
class jobs that have enabled countless workers to provide for their 
families and retire with dignity. Unfortunately, many auto jobs are not 
what they used to be.
    Over the past fifteen years, U.S. automotive production workers' 
wages have fallen significantly. When adjusting for inflation, average 
hourly earnings for production workers in auto assembly have declined 
by 23 percent, while wages in the auto parts sector have declined by 22 
percent.\3\ Real wages have dropped despite remarkable increases in 
productivity. From 1979 to 2018, net worker productivity rose 69.6 
percent, while the hourly pay of typical workers increased by a mere 
only 11.6 percent over 39 years (after adjusting for inflation).\4\ To 
make matters worse, since 2000, the U.S. has lost of over three million 
manufacturing production jobs.
---------------------------------------------------------------------------
    \3\ Bureau of Labor Statistics. ``Average hourly earnings of 
production and supervisory employees.'' Series CEU3133610008 & 
CEU3133630008, Data from April 2004-April 2019. Adjusted using BLS CPI 
Inflation Calculator.
    \4\ Economic Policy Institute. ``The Productivity-Pay Gap.'' July 
2019. https://www.epi.org/productivity-pay-gap/.
---------------------------------------------------------------------------
    A holistic approach is needed to address this complex problem. 
Congress and the Administration must fight for workers by strengthening 
our labor laws. Unionized workers are more likely to have health care 
benefits, employer provided pension plans and safer working conditions 
compared to their non-union counterparts.
    Congress and the Administration must enact equitable tax policies 
that uplift working families and not reward CEO's with massive tax 
breaks while incentivizing business to outsource jobs overseas.
    Congress and the Administration need to put in place a strong 
industrial policy focused on education, workforce training, research 
and development, support for advanced manufacturing and technologies, 
building a 21st century infrastructure, balancing environmental and 
energy policy.
    Of course, low wages and the lack of job security in U.S. 
manufacturing is far from the only serious challenge facing working 
people.
                      tackling our climate crisis
    The climate crisis is real and growing. Failing to take concrete 
steps to address it puts us on an unsustainable course. It not only 
creates risks for our national security and our planet, but it is also 
a direct threat to our jobs, and an even bigger threat to the jobs and 
quality of life enjoyed by our children and grandchildren in the 
future.
    There is no credible scientific debate on the connection between 
fossil fuel consumption, rising carbon dioxide levels in the earth's 
atmosphere, and climate change. The impact is happening in real time as 
the number and strength of extreme weather and climate events such as 
heat waves and droughts have increased over the last several decades. 
UAW members and retirees throughout the continental United States and 
Puerto Rico have suffered from extreme weather events in recent years.
    The problems created by climate change are grave and include 
increased risk of extinction for many species, risks to fisheries and 
crops, reduced access to fresh water, and more extreme storms that 
destroy homes and threaten to devastate coastal cities.
    Protecting the environment is not inherently bad for the economy 
and solutions exist all around us. UAW members have proven that well-
crafted regulations and policies can benefit both American workers and 
our environment.
    Last decade UAW members reached a hard-fought consensus among a 
wide variety of stakeholders to significantly reduce passenger vehicle 
emissions and raise the Corporate Average Fuel Economy (CAFE) for 
passenger vehicles sold in the United States. This standard 
demonstrated that well-constructed regulations and policies can promote 
investment in advanced technology, create new jobs, and make our cars 
more attractive in foreign markets while allowing manufacturers the 
flexibility they need. Fuel efficiency is improving across the 
industry, including many vehicles and components made by UAW members.
    Standards have played an important role in incentivizing the 
development of more energy efficient vehicles. It is not clear to what 
extent they will in the future. The Administration's preferred 
alternative would drastically roll back fuel efficiency standards. 
Rolling back emissions standards risks allowing the U.S. auto industry 
to fall behind on advanced vehicle technology and sustainable 
innovation, just as other nations are promoting increased efficiency 
and lower emissions It could also lead to years of litigation and 
uncertainty. This would not be a good outcome for workers, the economy, 
or the environment.
    We urge the Administration to not adopt the preferred alternative.
                           the future of evs
    A strong, forward looking industrial policy is needed to promote 
the manufacturing of EVs in the United States. Again, our trade, tax, 
labor, and environmental policies must work in tandem to promote the 
manufacturing of EVs in the United States. We can promote high quality 
manufacturing jobs that make vehicles of the future in the U.S. in a 
myriad of ways, such as: advancing trade policies that strengthen U.S. 
manufacturing, investing in clean energy infrastructure, supporting 
worker training, and advancing pro-worker policies that enable workers' 
to collectively bargain free of employer intimidation.\5\
---------------------------------------------------------------------------
    \5\ UAW Research. ``Taking the High Road: Strategies for a Fair EV 
Future.'' August 2018. https://uaw.org/wp-content/uploads/2019/07/EV-
White-Paper-Spring-2019.pdf.
---------------------------------------------------------------------------
    EVs are currently only one percent of the U.S. market but are 
projected to rise to 10 percent of the market in the mid-2020's and 
over 50 percent by 2040.\6\ EVs will increase their market share, it is 
just a matter of how quickly. This change will not come without serious 
challenges.
---------------------------------------------------------------------------
    \6\ https://about.bnef.com/electric-vehicle-outlook/.
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    The shift to EVs involves a fundamental change in the components 
that power the vehicle. We could see changes in where the most valuable 
auto components are made, decreased employment in powertrain 
manufacturing, and the entrance of corporate actors without a 
manufacturing base.
    If the EV manufacturing footprint takes root outside the US, it 
will be extremely difficult for the U.S. to recapture that work in the 
future. The capital intensity and long manufacturing lead times in 
auto, makes the possibility of reshoring the EV market once it has 
left, all the less likely.
    As consumer demand grows and technologies evolve, it is essential 
that we are building EVs in the United States. This opportunity will be 
lost if EV components are imported or made by low road suppliers who 
underpay workers. We must have an industrial policy that fosters the 
creation of high-quality manufacturing jobs making EVs and their 
components.
    Most of the production footprint for tomorrow's advanced automotive 
technology is being developed overseas. It is projected that by 2021, 
56 percent of the battery manufacturing capacity will be in China and 
another 19 percent will be in Europe. The U.S. will only have 14 
percent of global battery production capacity. The U.S. is currently 
falling behind its Asian and European counterparts.
    EVs and Plug-in Hybrid Vehicles made up approximately 2 percent of 
US passenger vehicle sales in 2018.\7\ Given that production volumes 
are still relatively small, automakers are in the process of developing 
their EV strategies. Policy incentives at this early stage could 
influence where and under what conditions the cars are made.
---------------------------------------------------------------------------
    \7\ http://www.ev-volumes.com/country/usa/.
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    Some automakers have made commitments to build EVs on U.S. soil, 
illustrating we could expand the number of America workers in high 
quality jobs building the cars that will help meet our climate goals.
    For example:
           Ford's plans to make EVs in Flat Rock, MI \8\
---------------------------------------------------------------------------
    \8\ https://media.ford.com/content/fordmedia/fna/us/en/news/2019/
03/20/ford-adds-2nd-north-american-site-to-build-battery-
electrics.html.
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           GM's plans to build a new EV in Orion Township, MI 
        \9\
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    \9\ https://media.gm.com/media/us/en/gm/home.detail.html/content/
Pages/news/us/en/2019/mar/0322-orion.html.
---------------------------------------------------------------------------
           Fiat Chrysler will build a Jeep Wrangler PHEV in 
        Toledo, OH \10\
---------------------------------------------------------------------------
    \10\ https://www.toledoblade.com/business/automotive/2018/12/01/
jeep-wrangler-hybrid-coming-quietly-to-a-woods-near-you/stories/
20181130116https://media.vw.com/releases/1117.
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    At the same time, some production has moved overseas.
    For example:
           GM ended production of the Chevy Volt plug-in hybrid 
        in February 2019. The Chevy Volt was made at GM's Detroit-
        Hamtramck plant, which GM has declared ``unallocated.'' \11\
---------------------------------------------------------------------------
    \11\ https://www.cbsnews.com/news/chevy-volt-discontinued-
chevrolets-last-volt-rolls-off-the-assembly-line/.
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           Ford ended production of the C-Max Energi plug-in 
        hybrid and the Ford Focus Electric EV in 2018. The C-Max was 
        produced at Michigan Assembly in Wayne, MI. Michigan Assembly 
        now makes the Ford Ranger mid-sized pickup. Ford will begin 
        production of EV SUV in Cuautitlan, Mexico starting in 
        2020.\12\
---------------------------------------------------------------------------
    \12\ https://www.autonews.com/article/20180508/BLOG06/180509813/a-
final-goodbye-to-the-ford-focus-c-max.
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    As consumer demand grows and technologies evolve, it is essential 
that we are building EVs in the United States. This opportunity will be 
lost if EV components are imported or made by low road suppliers who 
underpay workers.
    Countries around the globe continue to promote greater efficiency 
and lower emissions. The greener vehicles of the future are going to be 
made somewhere and other countries are preparing for these new 
technologies. We could see the U.S. auto industry fall behind on 
advanced technology, hurting the American economy and American workers.
    The global market is moving towards ever more efficient vehicles, 
including hybrids and electric vehicles. It has been projected that by 
2040, over 50 percent of new car sales globally will be electric and 
over 30 percent of cars on the road will be powered by batteries.\13\ 
Yet, where will the batteries that power these vehicles be made? As it 
stands today, most of the production footprint of tomorrow's advance 
automotive technology will be overseas.
---------------------------------------------------------------------------
    \13\ https://about.bnef.com/electric-vehicle-outlook/.
---------------------------------------------------------------------------
    In addition, the demand for raw materials such as cobalt and 
lithium to make EV batteries often come at troubling cost. 60 percent 
of the world's cobalt is mined in the Democratic Republic of Congo 
(DRC), where child labor and other labor abuses are prevalent, and 
injury and death are common.\14\ Congress should not ignore this part 
of the supply chain. Congress should take measures to hold companies 
accountable that exploit workers throughout the entire supply chain.
---------------------------------------------------------------------------
    \14\ UAW Research. (August 2018) ``Taking the High Road: Strategies 
for A Fair EV Future.'' https://uaw.org/wp-content/uploads/2019/07/EV-
White-Paper-Spring-2019.pdf.
---------------------------------------------------------------------------
    EVs and autonomous vehicles (AVs) of the future will be heavily 
reliant on semiconductors. It is estimated that an EV/AV will have over 
a thousand dollars' worth of semiconductors. This increase in 
semiconductor usage comes at a time when U.S. semiconductor 
manufacturing has been in decline. The total number of U.S. fabrication 
plants have decreased from 123 in 2007 to 95 today,\15\ while the 
industry employs 100,000 fewer production workers than it did at the 
turn of the century.\16\ Currently, U.S. manufacturers account for only 
13 percent of the global semiconductor supply. This is because the U.S. 
is no longer attracting new fabrication plants. In 2011, of 27 high-
volume fabrications plants built worldwide, only one was in the U.S.; 
18 were in China and 4 in Taiwan. In 2018, 20 new fabrication projects 
had been announced in China, with total investment exceeding $10 
billion.\17\
---------------------------------------------------------------------------
    \15\ MForesight, ``Manufacturing Prosperity: A Bold Strategy for 
National Wealth and Security'', June 2018: http://mforesight.org/
download/7817/.
    \16\ BLS, Quarterly Census of Employment and Wages (QCEW) for NAICS 
334413, http://www.bls.gov/cew/.
    \17\ MForesight, ``Manufacturing Prosperity: A Bold Strategy for 
National Wealth and Security'', June 2018: http://mforesight.org/
download/7817/.
---------------------------------------------------------------------------
                               next steps
    Federal policy must strongly incentivize investment in and 
production of advanced technology components and vehicles in the U.S. 
If the U.S. falls behind on this front, it will erode our competitive 
advantages in manufacturing and research. We all have an obligation to 
not cede the jobs and technology of the future to other countries.
    The U.S. is in a race with other advanced countries to develop the 
automobiles and technologies of the future. While Germany and other 
industrialized countries have developed policies that are investing in 
its citizenry and infrastructure, the U.S. has instead taken a low-road 
approach. Corporations may develop new products in the U.S., but they 
have increasingly outsourced manufacturing to low-cost countries. 
Maintaining the status quo is not an option.
    Special attention must be paid to key components that are important 
for the U.S. to remain relevant in vehicle parts manufacturing.
    Safeguards should be put in place to ensure domestic production of 
strategic parts. Technologies that have been developed, primarily 
thanks to American R&D (for example, AVs) and regulatory requirements 
(emissions and fuel efficiency standards), should be manufactured in 
the U.S. Protecting strategic parts will help ensure U.S. manufacturers 
will remain industry leaders, and that all American workers will share 
in that prosperity.
                               conclusion
    American workers have a proud history of building the equipment and 
technologies that have made the U.S. a global leader.
    As we confront the climate crisis, we urge Congress to support 
policies that invest in U.S. manufacturing and promote U.S. leadership 
in advanced auto technology. Our policies to fight climate change must 
promote investment in building diverse fleets of vehicles on U.S. soil 
with high quality jobs that contribute to stronger communities for 
generations to come.
    We stand ready to work with you and all other stakeholders on 
crafting policies that are good for working people, environment, and 
national economy.
    I look forward to answering your questions.

    Ms. Castor. Thank you very much.
    Mr. Shah, you are recognized for 5 minutes.

                    STATEMENT OF TARAK SHAH

    Mr. Shah. Thank you.
    Good afternoon, Chair Castor, Ranking Member Graves, and 
members of the committee. It is an honor to be here.
    My name is Tarak Shah, and I currently work as an 
independent consultant to organizations that are advancing 
clean energy technology and policy. For most of this decade, I 
worked on energy policy in the Federal Government, including as 
chief of staff to the Under Secretary for Science and Energy at 
the Department of Energy from 2014 to 2017, also at the Defense 
Department on energy policy, and recently as an adviser to the 
International Energy Agency.
    From those experiences, I have come to believe that the 
Federal Government can and should be doing more to stimulate 
clean energy manufacturing. Today, I would like to share with 
you why and how.
    We know that the climate crisis requires that we completely 
transform the ways we use and produce energy and at a scale and 
pace we have never before accomplished. And one of the 
principal ways we will do this will be with better products, 
like solar panels, wind turbines, energy efficient appliances, 
carbon capture technologies, advanced nuclear and low carbon 
chemicals, steel, and cement. Added up, the world will invest 
nearly $60 trillion over the next 20 years in the energy 
industry. All of those products are going to be manufactured 
somewhere, and with the right policies, that somewhere could be 
the United States.
    In many ways, we are already well positioned. We have a 
national consensus that innovation is important. Our U.S. 
Government is the largest Federal supporter of energy R&D in 
the world, and our innovation system is world leading, starting 
international laboratories and universities and all the way to 
the companies and financial institutions that are deploying 
clean energy.
    Many of the programs in the U.S. are implemented through 
the Department of Energy, and these include efforts like the 
Manufacturing USA Institutes which fund public/private teams 
that reduce the cost of making next-gen clean energy 
technologies. Other programs fund industry directly to take on 
clean tech challenges, like how to manufacture better 
semiconductors or denser batteries, but these programs barely 
scratch the surface of what is needed.
    For example, DOE's Advanced Manufacturing Office, which 
funds these Manufacturing USA Institutes, along with hundreds 
of other clean energy manufacturing efforts, received less than 
1 percent of DOE's overall funding last year. So we need to 
improve and better fund the tools that we have, but we also 
need to invent some new ones.
    We can take steps in three areas, research and development, 
deployment, and workforce development, to do so. In the area of 
R&D, Congress should immediately double clean energy R&D 
funding across the board, including for clean energy 
manufacturing R&D. From my time at DOE, I know that the 
scientists and engineers both at headquarters and in the 
national laboratories are the world's leading energy 
technologists, and given the opportunities to support more 
innovative U.S. businesses, they can and will do so.
    In addition, our industrial sector is probably the hardest 
to decarbonize. Congress should authorize DOE to establish a 
new R&D effort to investigate the full range of decarbonization 
efforts for the industrial sector, including electrification, 
low carbon fuels, and carbon capture utilization and 
sequestration. The Clean Industrial Technology Act of 2019 
which Representative Casten has introduced would do exactly 
that.
    Second in the area of deployment, Congress should 
reinstitute the 48C Advanced Clean Energy Manufacturing Tax 
Credit. From 2009 to 2017, this investment tax credit expanded 
domestic clean energy manufacturing nationwide and created tens 
of thousands of jobs at the same time.
    Next, DOE already requires awardees to commit to 
manufacturing technologies developed with DOE funding 
domestically, but these requirements are toothless and still 
allow U.S. taxpayer funded clean energy R&D to be manufactured 
offshore. Congress should close this loophole and give DOE the 
authority to enforce these commitments.
    Congress can also allow DOE's Loan Programs Office to 
invest in efficient heavy-duty truck and bus manufacturing.
    Finally, a competitive growing manufacturing sector needs a 
talented workforce of engineers and technicians. Congress 
should authorize and fund new workforce development programs 
that teach skills in topics like clean energy manufacturing, 
robotics, artificial intelligence, and green construction.
    These recommendations and more are in my written testimony 
and also in a forthcoming report that I have authored along 
with the staff at the Natural Resources Defense Council.
    This is about climate change, but it is also about gaining 
millions of new jobs for higher living standards and new 
economic opportunities. Now is the time for Congress to give 
the Federal agencies the tools to catalyze our private sector 
into winning this global race.
    Thank you very much, and I look forward to answering your 
questions.
    [The statement of Mr. Shah follows:]

                        Testimony of Tarak Shah

     Former Chief of Staff, Under Secretary for Science and Energy

   Before the U.S. House of Representatives, Select Committee on the 
                             Climate Crisis

  Solving the Climate Crisis: Manufacturing Jobs for America's Workers

                           September 10, 2019

    Good afternoon Chair Castor, Ranking Member Graves, and members of 
the committee. Thank you for the opportunity to have a discussion today 
about how clean energy manufacturing can help address the climate 
crisis and create jobs in the United States.
    My name is Tarak Shah. From 2014-2017, I served as Chief of Staff 
to the Under Secretary for Science and Energy and the U.S. Department 
of Energy (DOE). I now work as an independent consultant to private 
sector and non-government organizations that are advancing clean energy 
technology and policy.
           innovation as the key to long term economic growth
    For decades, economists have recognized that technological 
innovation is the principal driver of long-term growth in living 
standards and the broader economy.\1\ And, according to the National 
Science Foundation, U.S. manufacturing firms were responsible for two 
thirds of the R&D conducted and paid for by companies in the U.S. in 
2016.\2\ Taken together, we know that there are critical links between 
manufacturing innovation and the health of our economy.
---------------------------------------------------------------------------
    \1\ Moses Abramovitz, ``Resource and Output Trends in the U.S. 
since 1870,'' American Economic Review 46, no. 2 (May 1956). http://
www.nber.org/chapters/c5650.pdf.
    \2\ ``Business Research and Development and Innovation: 2016,'' 
National Science Foundation (May 2019). https://ncses.nsf.gov/pubs/
nsf19318/-&.
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    We also know that climate change is impacting us now, that if left 
unchecked the effects over the next century will fundamentally and 
negatively change the way humans live. While it is not too late to 
prevent its worst potential impacts, to do so, we need to completely 
transform the ways we use and produce energy, and at a scale and pace 
never before accomplished.
    Unfortunately, there is no silver bullet to ending the climate 
crisis. Instead, we must take steps to eliminate greenhouse gas 
pollution from multiple sectors at once--steps like increasing energy 
efficiency and zero-emitting power generation at record pace, 
electrifying buildings and transportation systems in order to replace 
fossil fuel use, transitioning industrial processes to be carbon 
neutral, and capturing already-emitted carbon from the atmosphere.
    There are two principle ways we can achieve this transformation--
first, by enacting a comprehensive set of new policies to curb 
pollution and deploy clean energy technologies and second, by 
simultaneously developing new energy technologies. Today, I will 
describe strategies that cut greenhouse gas emissions, while also 
creating millions of new jobs and better economic opportunities for 
Americans as well.
    To share the bottom line up front, Congress has the ability to 
significantly alter our nation's future by stimulating more domestic 
clean energy manufacturing.
                  winning the global clean energy race
    Congress can make a large impact on our clean energy economy 
because new Federal investments and policy changes can help U.S. 
workers access the huge global opportunity associated with addressing 
climate change. The International Energy Agency estimates that nearly 
$60 trillion will be invested in global energy markets over the next 20 
years.\3\ Given the enormous size of this economic opportunity, 
countries around the world will be competing for shares of this market, 
using all the tools they can bring to bear.
---------------------------------------------------------------------------
    \3\ ``World Energy Outlook 2018,'' International Energy Agency 
(November 2018). https://www.iea.org/weo/.
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    Much of the opportunity in this space lies in manufacturing--both 
in building tomorrow's energy technologies like solar, wind, batteries, 
efficient appliances and carbon capture technologies and in reducing 
the energy demand and GHG emissions associated with everything we 
manufacture, particularly in energy intensive industries like petroleum 
refining, chemicals, iron and steel, and cement.
    For many of these technologies, the U.S. has led the globe on their 
research and development. But without care, we risk seeing the benefits 
of taxpayer funded technology investments being reaped by other 
countries.
    For example, solar photovoltaics (PV) were invented by American 
industry and nurtured for decades in government labs. However, about a 
decade ago, just as the price of the technology began to make it 
competitive with other forms of power generation, Chinese companies, 
with substantial assistance from their government, stepped in to become 
the world's low-cost manufacturer.\4\
---------------------------------------------------------------------------
    \4\ Varun Sivaram, ``Unlocking Clean Energy,'' Issues in Science 
and Technology (Winter 2017). https://issues.org/unlocking-clean-
energy/.
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    Today, over 60% of the world's solar panels are manufactured in 
China.\5\ In fact, China has now developed an entirely domestic solar 
manufacturing supply chain--from polysilicon to finished modules. The 
jobs associated with mining, making solar cells, module assembly, even 
manufacturing the equipment that makes solar panels are all now 
primarily based in China. In addition, that expertise is now spilling 
over into other high-value industries like semiconductor manufacturing. 
As those industries dramatically expand over the coming years, China 
will continue to benefit.
---------------------------------------------------------------------------
    \5\ ``Renewables 2017,'' International Energy Agency (October 
2017). https://www.iea.org/publications/renewables2017/.
---------------------------------------------------------------------------
    There are effective steps we can take now to prevent the same from 
happening to the next generation of low and zero carbon technologies.
                       key technology focus areas
    Opportunities to innovate and hold manufacturing preeminence exist 
for technologies across the clean energy spectrum, and I will briefly 
mention several.
    First, with solar energy, the U.S. should continue to compete. 
Total domestic PV capacity is expected to double over the next five 
years.\6\ Capturing even some of the manufacturing associated with that 
increase would represent a significant economic opportunity. In 
addition, the U.S. leads on developing new solar technologies including 
multi-junction cells and perovskites, and as they commercialize, we 
should build them here, which will correspond with high-quality jobs 
for Americans.
---------------------------------------------------------------------------
    \6\ ``Solar Market Insight Report--Q2 2019,'' Solar Energy 
Industries Association (June 2019). https://www.seia.org/research-
resources/solar-market-insight-report-2019-q2.
---------------------------------------------------------------------------
    Offshore wind is huge untapped opportunity in the U.S. Driven by 
state-level policy commitments, particularly in the Northeast, the 
market is expected to grow from 5 turbines deployed today, to at least 
one thousand by 2030, which represents enough capacity to power roughly 
5 million homes.\7\ Despite this, there are no U.S.-flagged 
installation vessels or any domestic manufacturing centers yet built.
---------------------------------------------------------------------------
    \7\ ``2018 Offshore Wind Technology Market Report,'' U.S. 
Department of Energy (August 2019). https://www.energy.gov/sites/prod/
files/2019/08/f65/2018%20Offshore%20Wind%20Market%20Report.pdf.
---------------------------------------------------------------------------
    Nearly 10% or 231,000 of the 2.5 million workers in the domestic 
auto industry worked with electric vehicles (EV) in 2018.\8\ But this 
industry is rapidly evolving. Domestic EV demand in other countries 
that manufacturing cars is higher than in the U.S. As companies in 
these countries develop robust supply chains and scale to satisfy 
domestic demand, they will also gain an exporting advantage.
---------------------------------------------------------------------------
    \8\ ``2019 U.S. Energy and Employment Report,'' Energy Futures 
Initiative (March 2019). https://www.usenergyjobs.org.
---------------------------------------------------------------------------
    Nearly one third of the cost of an EV is in the battery that powers 
the vehicle.\9\ China already controls about 73% of the global lithium 
cell manufacturing capacity, while the U.S. has about 12%.\10\ China 
has used this early lead to become the global manufacturer for electric 
buses.
---------------------------------------------------------------------------
    \9\ Electric Car Price Tag Shrinks Along With Battery Cost,'' 
Bloomberg New Energy Finance (April 2019). https://www.bloomberg.com/
opinion/articles/2019-04-12/electric-vehicle-battery-shrinks-and-so-
does-the-total-cost.
    \10\ ``Why China is Dominating Lithium-Ion Production,'' Forbes 
(August 2019). https://www.forbes.com/sites/rrapier/2019/08/04/why-
china-is-dominating-lithium-ion-batteryproduction/- 1e39ab423786.
---------------------------------------------------------------------------
    The key driver of U.S. wind, solar and EV deployment over the past 
decade has been tax policy. That policy has not been stable and has 
introduced long-term uncertainty for companies across the supply chain, 
including manufacturers. In some cases, that has led to factory 
closures and layoffs. Congress can stave off this uncertainty by acting 
now to extend credits for a variety of low carbon technologies before 
they expire.
    In the power sector, the world needs 100 times more carbon capture 
capacity by 2030 than it currently has to maintain a path to prevent an 
increase in global average temperatures of more than 2 degrees C.\11\ 
Each of these facilities require huge machines--machines that can and 
should be built in America, not to mention the hundreds of construction 
jobs and dozens of permanent jobs associated with their installations 
and operation. The largest carbon capture facilities in the world are 
in the United States, but other countries are taking concrete steps to 
deploy this technology. We need to act now to build a CCUS industrial 
base in the U.S. that exports this homegrown technology around the 
world.
---------------------------------------------------------------------------
    \11\ ``Tracking Clean Energy Progress,'' International Energy 
Agency (June 2019). https://www.iea.org/tcep/power/.
---------------------------------------------------------------------------
    Advanced nuclear power offers another very important zero-carbon 
manufacturing opportunity for the United States. The nuclear supply 
chain already employs nearly 5,000 Americans.\12\ Domestic small 
modular reactor manufacturing could also support export markets.
---------------------------------------------------------------------------
    \12\ Ibid. 8.
---------------------------------------------------------------------------
    Hydrogen has a wide variety of potential applications, particularly 
in industry. For example, hydrogen produced by renewable energy can 
replace metallurgical coal to dramatically reduce carbon pollution 
emitted during steel making, providing a competitive advantage for U.S. 
steel industry jobs, including in steel-making regions like 
Representative Palmer's district. Renewable hydrogen could also act as 
a form of low carbon energy storage, be used to replace fossil fuels in 
industrial heating processes, and be converted to green fertilizers.
    The U.S. has an early lead in additive manufacturing, also known as 
3-D printing, thanks to early investments by the U.S. Department of 
Energy. As the first step in the supply chain for a variety of finished 
high-value energy-efficient products in the aerospace, energy, and 
transportation sector, it is important to continue to support 
development of this technology domestically.
    Finally, energy efficiency products including LED bulbs, solid 
state power electronics, better motors, and high efficiency appliances 
are a source of manufacturing strength for the U.S. Manufacturing these 
products employed over 320,000 Americans in 2018. Many of these 
products are made in America and exported around the world.
    All of these technologies would benefit from a long-term price 
signal on greenhouse gas pollution. Valuing the low/no carbon aspects 
of these technologies could help them better compete with existing 
energy resources, create spillover benefits across our economic sectors 
and thus spur growth in manufacturing capacity in the U.S.
                     role of the federal government
    The Federal government currently supports clean energy 
manufacturing in two principal ways--by supporting research and 
development and through workforce development.
    Clean energy manufacturing R&D is supported by a variety of 
programs at the Department of Energy and concentrated in the Advanced 
Manufacturing Office (AMO). Over the past few decades, several 
technologies fostered by DOE have left the lab and entered the market 
with great success. These include solar panels, wind turbines, grid-
scale batteries, and LED light bulbs (see Figure 1). In each case, DOE 
has supported both the initial development of the technology and 
subsequent innovations in manufacturing these products to bring down 
costs.

[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]


    DOE sponsors programs to make U.S. manufacturers more competitive 
vis-a-vis foreign competitors. For example, the Innovation in 
Manufacturing Competitiveness program in the Solar Energy Technology 
Office funds projects that are helping rebuild the solar module 
industry and supply chain in America.
    AMO pursues a large variety of programs to do the same, including 
through the Manufacturing USA Institutes, a national network of 
federally sponsored manufacturing institutes, each with their own 
technological concentration, but designed to accelerate U.S. 
manufacturing as a whole. For 2019, Congress appropriated $320 million 
for the Advanced Manufacturing Office, or less than 1% of DOE's overall 
appropriation.\13\
---------------------------------------------------------------------------
    \13\ ``Joint Explanatory Statement of the Committee of 
Conference,'' U.S. Congress. September 2018. https://docs.house.gov/
billsthisweek/20180910/Joint Statement.pdf.
---------------------------------------------------------------------------
    In addition, through the R&D tax credit, the Federal government 
rewards companies for performing research in the U.S. It was made 
permanent in 2015 and has provided companies over $11B in credits 
annually in recent years. This tax credit generally benefits all firms, 
including clean energy manufacturers who perform R&D.
    Government labs are also playing a role, not only in developing new 
technology, but in supporting energy and manufacturing innovators. 
Programs like Cyclotron Road at Lawrence Berkeley National Laboratory 
support entrepreneurial scientists and engineers through a two-year 
fellowship program, giving then access to the unique expertise and 
world-class facilities of the laboratory. Fellows in the program work 
on hard science products like microelectronics, carbon nanotubes, 
fibers and polymers, and electrochemical storage devices. Once 
commercialized, these products will create innovative manufacturing 
jobs across the country.\14\
---------------------------------------------------------------------------
    \14\ ``Cyclotron Road 2018 Impact Report,'' Lawrence Berkeley 
National Laboratory. (2019). https://www.cyclotronroad.org/.
---------------------------------------------------------------------------
    DOE also supports some workforce development programs, which are 
important to ensure that domestic manufacturers can access a trained 
pool of engineering and technical talent to meet demand from the 
growing clean energy market. Programs like the Solar Instructor 
Training Network and the Collegiate Wind Competition have been 
successful in training the next generation of clean energy 
professionals. DOE's Industrial Assessment Centers also train the next 
generation of collegiate engineers as they perform energy audits at 
small and medium sized manufacturing facilities around the country. As 
a result of this program, students are given valuable learning 
experiences while American businesses receive energy saving advice.
                the federal government can do much more
    With Congress' help, the Federal government can do much more to 
support clean energy manufacturing in three primary ways--focusing and 
strengthening its support of manufacturing R&D, deploying advanced 
energy manufacturing technologies, and ramping up workforce development 
programs. Taking these steps will not only help strengthen the 
competitiveness of U.S. manufacturing, but also help increase U.S. 
exports and support domestic job and wage growth.
    Many of these recommendations and others are included in a 
forthcoming report I have written along with staff at the Natural 
Resources Defense Council. I look forward to sharing the full report 
with the Committee.
    In the area of R&D, Congress should immediately double funding for 
the entire suite of federal energy innovation efforts, including 
advanced clean energy manufacturing. DOE programs are oversubscribed--
meaning that there are many more qualified research applicants than 
there is funding available. Additional funding will yield faster clean 
energy innovation. Congress should also make manufacturing 
competitiveness and exports an explicit authorized goal of DOE 
research.
    In addition, because many technology options to decarbonize the 
U.S. industrial sector are currently very expensive or non-existent, 
DOE should establish a new R&D effort to investigate the full range of 
decarbonization options for the industrial sector, including 
electrification, low-carbon fuels, and carbon capture, utilization, and 
sequestration (CCUS). H.R. 3978, the Clean Industrial Technology Act of 
2019, which Representative Casten has introduced, would do exactly 
this.
    In the area of deployment, Congress should reinstitute the 48C 
Advanced Clean Energy Manufacturing Tax Credit. That tax credit, 
jointly administered by DOE and the Department of the Treasury from 
2009 to 2017, provided $2.3 billion in funding through a 30% investment 
tax credit to hundreds of firms around the nation.\15\ These firms used 
the funding to expand domestic manufacturing capacity for parts and 
equipment for clean energy projects.
---------------------------------------------------------------------------
    \15\ ``48C Phase II Advanced Energy Manufacturing Tax Credit 
Program Fact Sheet,'' U.S. Department of Energy (December 2013). 
https://www.energy.gov/downloads/48c-phase-ii-advanced-energy-
manufacturing-tax-credit-program-fact-sheet.
---------------------------------------------------------------------------
    Funding helped American manufacturers expand production for 
efficient HVAC systems, cleaner trucks, efficient lightbulbs, smart 
power electronics, electric vehicles and SUVs, wind turbines, lithium-
ion batteries, and much more. These projects generated tens of 
thousands of jobs while making our economy cleaner and more efficient. 
A new program, double the size of the previous one, could help 
stimulate manufacturing supply ecosystems for the next generation of 
clean energy technologies.
    Under a provision of the Bayh-Dole Act, DOE's Energy Efficiency and 
Renewable Energy (EERE) and Advanced Research Projects Agency-Energy 
(ARPA-E) programs require award applicants to submit U.S. Manufacturing 
Plans.\16\ These plans state an awardee's commitment to manufacture 
technologies resulting from DOE awards in the United States.
---------------------------------------------------------------------------
    \16\ ``Determination of Exceptional Circumstances Under the Bayh-
Dole Act for Energy 
Efficiency, Renewable Energy, and Advanced Energy Technologies,'' U.S. 
Department of 
Energy (September 9, 2013). https://www.energy.gov/sites/prod/files/
2014/01/f6/DEC_for_
Energy_Efficiency_Renewable_Energy_%26Advanced Energy.pdf.
---------------------------------------------------------------------------
    Congress should ask DOE to strengthen this requirement by applying 
it to all applied energy RDD&D programs (not just EERE and ARPA-E) and 
to develop recommendations for strengthening proposed manufacturing 
plans. Specifically, the current law gives the Federal government very 
few mechanisms to enforce the commitments that awardees make in their 
plans. These mechanisms could include clawback provisions for 
intellectual property or financial compensation for U.S. taxpayer 
sponsored technology that is manufactured offshore.
    Congress can also expand the remit of DOE's Loan Programs Office's 
Advanced Technologies Vehicles Manufacturing program. The program 
provides loans to automotive or automotive component manufacturers to 
build or expand manufacturing facilities that produce fuel-efficient 
vehicles. The program has supported the production of more than four 
million fuel-efficient and electric vehicles, including Tesla's 
California factory and Nissan's Tennessee factory, which produces the 
Leaf.\17\ While the program has $17.7B in loan authority left, it is 
not currently allowed to invest in efficient heavy-duty truck and bus 
manufacturing. Congress can expand ATVM's authority with no additional 
scoring implications and, in doing so, support new manufacturing 
facilities and jobs in the U.S.
---------------------------------------------------------------------------
    \17\ ``Advanced Vehicles Manufacturing Projects,'' U.S. Department 
of Energy (June 2017). https://www.energy.gov/lpo/advanced-technology-
vehicles-manufacturing-atvm-loan-program.
---------------------------------------------------------------------------
    Additionally, incentives to develop regional ecosystems focused on 
the manufacturing of new energy technologies, like new battery 
chemistries, multi-junction solar cells, perovskites, and others 
discussed today will help grow the economy. These ecosystems are made 
up of strong supply chains, workforce development programs, investors, 
and national labs and universities (i.e. sources of innovation) and 
will create more jobs and make it more likely that the manufacturing of 
these technologies will stay in the U.S.
    Stronger trade and environmental standards with effective 
enforcement provisions could help even the playing field for U.S. 
manufacturers of clean energy. Foreign firms that manufacture clean 
energy products while polluting the environment have a leg up on U.S. 
firms that are subject to stricter state and Federal laws. Cross-border 
adjustment mechanisms that price carbon and other pollution could help 
ensure that U.S. manufacturers are not disadvantaged for stewarding the 
planet.
    U.S. manufacturers have a history of developing innovative, energy 
efficient products. DOE's Appliance Standards program sets and 
implements minimum energy performance standards for appliances and 
devices in our homes, businesses, and factories. These appliance 
standards have already saved consumers nearly $1 trillion dollars over 
the past three decades.\18\ By implementing rigorous appliance 
standards, innovative American firms would have an advantage over less 
efficient foreign products, thereby incentivizing U.S. manufacturing 
and creating jobs domestically.
---------------------------------------------------------------------------
    \18\ ``Saving Energy and Money with Appliance and Equipment 
Standards in the United States,'' U.S. Department of Energy (June 
2017). https://www.energy.gov/sites/prod/files/2017/01/f34/Appliance 
and Equipment Standards Fact Sheet-011917_0.pdf.
---------------------------------------------------------------------------
    Finally, California has recently instituted a ``Buy Clean'' 
procurement policy for steel, glass, and insulation purchased for 
state-funded projects. The policy considers a manufacturer's GHG 
emissions in state purchasing decisions, rewarding those manufacturers 
that have invested in pollution reduction. Congress should require the 
Federal agencies to adopt this policy, require that such products be 
made in America, and expand it to other finished goods and construction 
materials.
    And to develop and deploy these technologies, we need a 
competitive, growing manufacturing sector that has the workforce, the 
engineering talent, and capacity to innovate in order to meet the dual 
challenges of producing more clean energy and reducing the use of 
carbon emitting fuels.
    Workforce development programs that teach skills in topics like 
clean energy manufacturing, robotics, artificial intelligence, and 
green construction are lacking and required. Such training programs 
should be conducted in partnership with industry, to provide a clear 
pathway to job placement. In addition, these programs should be 
coordinated with other agencies, including the National Science 
Foundation and the Departments of Labor and Education. DOE workforce 
development programs also must include diversity and inclusion as a key 
criterion. Finally, DOE's Manufacturing USA Institutes could be tasked 
with workforce development for both engineers and technicians in their 
focus areas.
    Taking these steps will help maintain our national human capital 
lead, which is an important factor that firms consider when choosing 
where to locate their facilities.
                          concluding thoughts
    The United States is competing in a global clean energy race, along 
with every other country on the planet. Whoever wins will lead the 
planet in addressing climate change--which is the most serious 
challenge of our time--while also gaining the millions of jobs, the 
higher living standards, and the other economic opportunities that 
accompany it. Everything about our national innovation model--our 
world-leading academic and National lab systems, the entrepreneurial 
spirit of our private sector, and our national technological embrace 
tells me that we can win this race.
    What we need now is for Congress to give the Federal agencies the 
tools to catalyze our private sector into taking that leading position.
    Thank you very much for holding a hearing on this important topic.

    Ms. Castor. Thank you.
    Mr. Stones, you are recognized for 5 minutes.

                   STATEMENT OF EDWARD STONES

    Mr. Stones. Chairwoman Castor and Ranking Member Graves and 
members of the committee, thank you for the opportunity to 
share Dow's action plan to address the impacts of climate 
change.
    At Dow, we accept the scientific consensus that climate 
change caused by human activity has serious consequences and 
must be addressed. We believe the time is now for the U.S. 
Congress to establish a market-based price on carbon.
    I am accountable for delivering power and steam at Dow's 14 
company-owned generation facilities and at more than 100 
manufacturing facilities globally. Our manufacturing facilities 
rely on almost 7 gigawatts of reliable and cost-effective power 
and steam.
    Dow is one of the world's leading manufacturers of 
chemicals, plastics, and advanced materials, with about 15,000 
of our 37,000 employees based here in the United States. We 
have invested billions of dollars into our U.S. operations over 
the last decade because we intend to continue as the country's 
premier material science company.
    Addressing climate change is one of the greatest technical, 
social, and economic problems ever faced by humanity and one in 
which the U.S. must take a leadership role. By 2040, humanity's 
energy consumption is expected to increase by 28 percent over 
2015. By 2050, the population is expected to grow by another 2 
billion people, and power demand is going to grow by 30 to 50 
percent. Despite this, the International Panel on Climate 
Change has called for global carbon neutrality in that time. So 
society is faced with a challenge of meeting increased energy 
demand while simultaneously eliminating net emissions.
    Since the industrial revolution, economic growth has always 
been accompanied by increased energy usage and emissions. 
Although the need for action is clear, the time scale required 
for solutions will be decades, not years.
    Dow's approach to climate change is deeply rooted in the 
company's ambitions and values. According to Bloomberg, we are 
the leading user of renewable energy in the petrochemical 
industry with more than 700 megawatts under contract. Our 
products insulate, they dampen noise and vibration enabling 
lighter vehicles, they enable concentrated solar facilities, we 
seal buildings, and we keep food clean and fresh. On average, 
for each unit of carbon emitted by the chemical processes in 
our industry, our products will save two to three units of 
carbon emissions over their lifetime.
    Our processes are highly efficient, but are approaching a 
limit on what can be achieved through incremental improvements. 
Further substantial emission reductions will require a paradigm 
change supported by technology breakthroughs.
    Dow is leading on that front with the announcement of a 
retrofit of one of our mixed-feed crackers in Louisiana with a 
proprietary fluidized catalytic dehydrogenation, or FCDh, 
technology. That will reduce our greenhouse gas emissions by 
roughly 20 percent versus conventional technology.
    Partnership and government engagement are necessary to 
drive many of the technology actions that will make meaningful 
impacts, such as deploying CCS. We have to rely on our partners 
in government and industry to provide a network grid where we 
can store or use the carbon we capture. There is also a role 
for government in catalyzing the next generation nuclear 
technology.
    Finally, governments need to ensure the playing field is 
level, rules don't overlap, feedstock is treated differently 
than fuel and not unfairly penalized, and liability is 
addressed. Society needs a holistic approach that is 
sustainable, reliable, and affordable. Many regulations focused 
on just one or two of these pillars--or one or two of these 
pillars leading to significant unintended consequences such as 
carbon leakage where U.S. regulations are out of sync with the 
rest of the world and manufacturers move operations to less 
stringent locations. We need broad, global policy alignment, 
and the United States needs to be a leader. The consequences of 
getting this wrong are dire for both the environment and 
economy.
    For example, a $19 billion U.S. chemical industry trade 
surplus in 1997 became a deficit from 2001 to 2007 as 
feedstocks and energy became economically unavailable for the 
industry. More than 200,000 jobs were lost in our industry and 
assets were shut down permanently. We cannot afford for this to 
happen again.
    The chemical sector has seen hundreds of billions of 
dollars of investment over the past handful of years because of 
abundant and affordable energy resources. An affordable, 
reliable, and sustainable energy policy environment is critical 
for the industry to remain globally competitive.
    Thank you for the opportunity to be here today. We look 
forward to working with members of the committee and interested 
stakeholders.
    [The statement of Mr. Stones follows:]

                       Testimony of Edward Stones

      Global Business Director for Energy and Climate Change, Dow

   Before the U.S. House of Representatives, Select Committee on the 
                             Climate Crisis

  Solving the Climate Crisis: Manufacturing Jobs for America's Workers

                           September 10, 2019

                              introduction
    Chairwoman Castor and Ranking Member Graves, and members of the 
Committee, thank you for the opportunity to share Dow's perspective on 
actions we are taking to address climate change, and the impact these 
actions have on our ability to compete globally. My name is Edward 
Stones, and I am the Global Business Director for Energy and Climate 
Change within Dow's Feedstocks & Energy business. In this role I am 
accountable for delivering power and steam at Dow's 14 company-operated 
generation facilities, as well as steam, utilities, and energy services 
to more than 100 manufacturing facilities globally. I also have 
responsibility for Dow's energy conservation and greenhouse gas 
emission reduction efforts, and provide business guidance for the 
Company's global advocacy efforts in energy sustainability and climate 
change.
      dow intends to remain the premier material sciences company
    Dow was founded in Midland, Michigan in 1897, and is one of the 
world's leading manufacturers of chemicals, plastics and advanced 
materials. We supply thousands of products to customers in 
approximately 160 countries, connecting chemistry and innovation with 
the principles of sustainability to enable everything from fresh water, 
food, and pharmaceuticals to insulation, paints, packaging, and 
personal care products. About 15,000 of Dow's 37,000 employees are 
based in the United States.
    Dow has invested billions of dollars into its U.S. operations over 
the last decade because we intend to continue as the country's premier 
materials science company--today and well into the future. That means 
innovating and growing here in the U.S. while competing globally. The 
regulatory environment in the U.S. will frame our ability to deliver on 
that promise. We believe the time is now for the U.S. Congress to 
establish a market-based price on carbon, so the U.S. can continue to 
lead the world in new product development while reducing impact on the 
environment.
                     global scale of the challenge
    Addressing climate change is one of the greatest technical, social 
and economic problems ever faced by humanity. Today, the earth has 
roughly 7 billion inhabitants, about 1 billion of whom live with 
limited access to energy, and another 1 billion of whom have no power 
in their homes or communities. Human activity causes greenhouse gas 
(GHG) emissions of more than 50 billion tons/year of CO2 
equivalents (CO2e).\1\ Between 2010 and 2030, the world's 
middle class is expected to double in size, and by 2040, humanity's 
energy consumption is expected to increase by 28% vs. 2015.\2\ By 2050, 
the population is expected to grow by another 2 billion people, and 
power demand will grow by 30 to 50 percent.\3\ Despite this increase in 
demand, the International Panel on Climate Change has called for the 
globe to be carbon neutral by sometime between 2040 and 2055 so as to 
preserve the chance to limit temperature increases to less than 1.5 
degrees Celcius.\4\ Together, these points suggest humanity must both 
increase energy usage dramatically and simultaneously eliminate net 
emissions.
---------------------------------------------------------------------------
    \1\ UN Environment Emissions Gap Report, 2018.
    \2\ 2017 International Energy Outlook, US EIA.
    \3\ Ibid.
    \4\ The International Panel on Climate Change special report on 
global warming of 1.5 C (2018)
---------------------------------------------------------------------------
    However, historical data suggest the energy economy is unlikely to 
evolve quickly. Since the industrial revolution, economic growth has 
been accompanied by increased energy usage and emissions. Global energy 
demand doubled from 1995 to 2015.\5\ From the time energy sources 
achieved five percent of the global energy demand, it took coal fifty 
years to supply 40 percent of that demand, crude oil fifty years to 
supply 30 percent, and natural gas fifty years to supply 20 percent. 
Renewables do not yet supply 5 percent of the global energy demand.\6\ 
Although the need for action is clear, the time scale required for 
solutions will be decades, not years.\7\
---------------------------------------------------------------------------
    \5\ Richard Newell and Daniel Raimi (2018)
    \6\ V. Smil, Scientific American 2014, based on IEA data
    \7\ Grateful acknowledgement is made to Jason Bordoff of Columbia 
University for compiling the data presented.
---------------------------------------------------------------------------
              dow's approach to reducing carbon emissions
    We accept the scientific consensus that climate change caused by 
increasing greenhouse gas emissions from human activity has serious 
consequences for the planet and society if left unaddressed. Dow's 
approach to climate change is deeply rooted in the Company's ambitions 
and values:
         Our ambition is to become the most sustainable 
        materials science company in the world, and we strive to make a 
        positive impact on society and the planet in everything we do.
         Protecting the planet is one of our three core values.
         Our 2025 Sustainability Goals aim to help lead the 
        transition to a sustainable planet and society.
    In 2015, Dow embarked on its third and most ambitious set of 10-
year sustainability goals--the 2025 Sustainability Goals. Dow's 
sustainability journey has evolved from focusing on operational 
efficiency (footprint), to product solutions to world challenges 
(handprint), to recognizing that only through collaboration can we join 
others to accelerate the progress toward a sustainable planet 
(blueprint). The 2025 goals are centered around building blueprints for 
a sustainable planet, which are aligned to the UN Sustainable 
Development Goals and integrate public policy solutions, science and 
technology, and value chain innovation. The aim is to build solutions 
between government, business and society that generate shared values 
and are long lasting, scalable, and transformative. We know there are 
others who share our blueprint vision, and we want to join existing 
conversations and convene new ones on how we as companies and 
organizations can accelerate sustainable practices through 
collaboration.
    Dow's 2025 goals are designed to harness Dow's innovation 
strengths, global reach and the passion of our employees to expand the 
Company's impact around the world, driving unprecedented collaborations 
to develop societal blueprints that will facilitate the transition to a 
sustainable planet and society.
    Through our 2025 Sustainability Goal on World-Leading Operations 
Performance, Dow is committed to driving environmental benefits for our 
communities and the world. Making our operations as efficient as 
possible is not only important for the environment, but also makes 
clear business sense. We continue to actively:
         Maintain our absolute GHG emissions at or below our 
        2006 baseline, though we will grow globally by 2025.
         Obtain 750 MW of energy from renewable resources by 
        2025 (Dow is already one of the largest users of renewable 
        energy in the chemical industry).
         Offset new emissions of Priority Compounds, VOC's and 
        NOX, though we will grow globally by 2025.
      dow products contribute to reducing our customers' emissions
    Dow materials help customers and brand owners reduce the energy 
demand and carbon emissions of many of their products. On average, for 
each unit of carbon emitted by the chemical industry's processes, the 
resulting products will save 2 to 3 units of carbon emission over their 
lifetime.\8\
---------------------------------------------------------------------------
    \8\ Innovations for Greenhouse Gas Reductions: A Life-Cycle 
Quantification of Carbon Abatement Solutions Enabled by the Chemical 
Industry, International Council of Chemical Associations, 2009, 
Amsterdam.
---------------------------------------------------------------------------
         Polyurethane provides thermal insulation, vibration 
        dampening, and noise abatement in building structures and 
        transportation applications.
         Heat transfer fluids enable concentrated solar 
        facilities, which provide clean energy to more than 500,000 
        homes.
         Silicone sealants for buildings reduce emissions 200 
        Kg CO2e per Kg of silicone.
        Advanced Polyethylene enables down-gauging, reducing the 
        packaging materials required while preserving performance.
          responding to the physical effects of climate change
    Dow is experiencing the physical effects of climate change in two 
areas: manufacturing sites with hurricane exposure, and through water 
scarcity concerns. Forty to fifty percent of our volume is produced in 
the U.S. Gulf Coast with high exposure to hurricanes. In those 
locations, we have already implemented a host of mitigating factors 
like improved levy systems to prevent flooding, enhanced `greenbelt' 
areas to separate us from local communities, designing equipment 
specifically to sustain adverse weather, and water conservation 
programs. At the same time, there are places around the globe where 
water scarcity due to increased drought is a real concern. We've taken 
actions there--with our local communities--to improve those situations.
    We factor in all of these potential risks when making decisions 
about existing or future asset investments. We believe the consequences 
for these types of events will continue to increase unless society--and 
government--take action.
                the need for new technology development
    Dow's approach to carbon emissions has transitioned beyond an 
initial focus on energy efficiency and meeting renewables targets to 
additionally developing and deploying new technologies, and ensuring a 
corporate wide focus on carbon reduction at our sites and with our 
customers.
    We believe the transition to a lower carbon economy will require 
unprecedented cooperation between business and government. It is 
important that policymakers fully appreciate the technological, 
economic and societal challenges of such a transition. Achieving 
meaningful emissions reductions will require equally significant 
technology breakthroughs, which will take time, resources, and 
collaboration.
    Despite continuous improvement, the high efficiencies of industry's 
current processes mean we are approaching a limit in the emission 
reduction that can be achieved through incremental improvements. 
Achieving further substantial carbon emission reductions will require a 
paradigm change supported by technology breakthroughs.
    Over 96 percent of all manufactured goods are directly touched by 
the business of chemistry, which is why the chemical sector is the key 
to achieving breakthrough technology solutions to enable downstream 
emissions reductions. On average, for each unit of carbon emitted by 
the chemical industry's processes, the resulting products will save 2 
to 3 units of carbon emission over their lifetime.
    Dow is pursuing innovative chemical processes to deliver step 
changes in emissions intensity for our own operations and for others 
once fully commercialized, likely around 2030. The Company recently 
announced a retrofit of one of our mixed-feed crackers in Plaquemine, 
Louisiana with proprietary fluidized catalytic dehydrogenation (FCDh) 
technology. This technology will allow Dow to lower energy usage and 
associated greenhouse gas emissions by roughly 20 percent when compared 
to conventional propane dehydrogenation technologies, thereby improving 
our overall sustainability.
    Most sources of process heat today rely on fired heat, and few 
options exist for low carbon alternatives. This makes carbon capture 
and storage (CCS) and next generation nuclear critical technology and 
policy solutions. CCS needs to be explored at sites where a destination 
for CO2 is available as it may be the only technically 
available control technology today. State and federal governments have 
a role to play in defining and enabling the infrastructure required for 
collecting and moving captured CO2. Funding for approaches 
to utilize captured carbon beneficially (CCU) also will be helpful. 
Next generation nuclear facilities are an additional potential source 
of zero-carbon steam and power. Governments have a role to play in 
catalyzing the development and deployment of new nuclear technologies 
as well, and in expediting the permitting and construction processes.
       solving the energy trilemma while maintaining industrial 
                            competitiveness
    One of the key actions to lower overall carbon emissions of the 
industrial sector is to lower the carbon footprint of the sector's 
purchased power. Dow is on the leading edge of integrating renewable 
energy into our manufacturing operations. The Company is already one of 
the largest users of renewable energy in the chemical industry, and we 
are well on our way to surpassing our goal of obtaining 750 MW of 
energy from renewable sources by 2025.
    A major challenge facing society in the pathway to a lower carbon 
intensity--especially in the electricity sector and for industrial 
consumers--is the energy trilemma of affordability, sustainability, and 
reliability. Both the reliability and quality of the power grid are of 
paramount importance in ensuring the competitiveness of the industrial 
sector. Many of the regulations focus on one or two of these pillars 
alone, and often with significant negative consequences for the other 
legs of the trilemma. Instead, a holistic approach is needed to avoid 
unintended consequences.
    The most significant consequence of poorly crafted regulations 
would be carbon leakage, where U.S. regulations were out-of-sync with 
the rest of the world and manufacturers moved operations to locations 
with less stringent requirements. We need broad, global alignment on 
greenhouse gas emissions reduction programs, and the U.S. needs to be a 
leader. The consequences for getting energy policy wrong are dire. For 
example, a $19 Billion U.S. chemical industry trade surplus in 1997 
became a deficit from 2001-2007 as resources became economically 
unavailable for industry.\9\ Over this period, more than 200,000 jobs 
were lost in our industry.\10\
---------------------------------------------------------------------------
    \9\ US Dept. of Commerce data for SITC Code 5 (Chemicals and 
Related Products) from tse.export.gov website.
    \10\ US Bureau of Labor Statistics employment for Chemicals and 
allied industries in 2007 vs 1997, https://www.bls.gov/oes/tables.htm.
---------------------------------------------------------------------------
    Real world data clearly show the value of natural gas as a key 
driver for resolving the trilemma. From 2008-2017 in the U.S., natural 
gas increased its share in power generation dramatically, displacing 
outdated coal fired plants that were retired because of unfavorable 
economics. Germany, on the other hand, subsidized a substantially 
increased mix of renewables, replacing mostly nuclear plants. During 
this time, the U.S. CO2 emission intensity for power 
decreased by much more than in Germany while electricity was delivered 
to the average household at less than one-half of the price. Today, 
emission intensity in the U.S. is lower than in Germany, demonstrating 
the importance of natural gas-fired power generation as the 
stabilizing, cost-efficient anchor in the transition to a lower 
emission future (EIA, UBA).
   impact of grid design and power regulation on industrial consumers
    The technical aspects of grid design matter a great deal to 
industrial consumers. When considering renewable energy policy and grid 
design, policymakers need to account for the intermittency and peak 
load variability that comes along with integrating large amounts of 
renewable energy into the grid. Industrial processes operate on a 
continuous basis making us a consistent and predictable energy 
consumer. In return, we rely on a similarly consistent and reliable 
supply of power and steam to manufacture our products. This is best 
provided by a portfolio of energy supplies which includes both 
renewables and gas fired cogeneration.
    Some of the technical challenges associated with integrating 
renewable power into the grid are outside of our control, including 
access to abundant and affordable low-carbon power capacities. 
Similarly, we are seeing reductions in the quality of the power 
received from the grid at our facilities in terms of inertia and 
frequency control. Additionally, the intermittency of renewable power 
supplies dramatically increases the volatility of power markets--
including run ups from $30/MWh to $9000/MWh for power during several 
hours this summer in Texas.
    With respect to power grid planning and renewable energy policy 
development, we would like the Committee to consider the following 
major points:
           Cogeneration/Combined Heat and Power (CHP) are an 
        important part of efficiently meeting future power demand.
           In 2018, emissions of carbon dioxide 
        (CO2) by the U.S. electric power sector were about 
        33% of total U.S. energy-related CO2 emissions.\11\
---------------------------------------------------------------------------
    \11\ US EIA FAQ website, accessed 9/6/2019. https://www.eia.gov/
tools/faqs.php?id=77&t=11.
---------------------------------------------------------------------------
           Federally driven solutions may cause unintended 
        regional consequences.
           The ISO framework is the best way to address 
        regional specific power needs. This model preserves state 
        authority, maintains transmission owner withdrawal rights, and 
        includes a cross section of stakeholders from the region.
           Federal agencies (i.e. FERC) have a role in defining 
        the criteria under which regional ISO's operate. Attention 
        needs to be paid to the impact of renewables on the power grid 
        (i.e. through factors such as spinning inertia, ramp rate, load 
        factors, seasonality, etc.).
           Federal policy should continue to encourage 
        widespread utilization of cogeneration at industrial plants and 
        large facilities. Examples:
                   Right to sell cogeneration/Combined Heat 
                and Power (CHP) generated energy or capacity to a 
                utility at avoided costs and/or open access market 
                based rates.
                   Cogeneration/CHP considered eligible 
                resources for efficiency and carbon emission reduction.
    In Germany, the Netherlands, Australia, the UK, and the U.S., clean 
energy targets have had significant unintended consequences, resulting 
in wide day and night swings in power pricing and highly unattractive 
investment environments for power producers. Over time, gas and coal 
generation are retired, leading to higher risk of blackouts, etc.
                     government policies on climate
    Partnership, collaboration, and government engagement are necessary 
to drive many of the actions that will make meaningful impacts. For 
example, partnership will be needed to deploy CCS, which will likely be 
needed on some of our processes and for power generation grid 
stability. In those cases, we will work on how to capture the carbon, 
and rely on our partners in government and industry to provide a 
network grid where we can store or use the carbon we capture. 
Governments also need to ensure the playing field is level, rules do 
not overlap, feedstock is treated differently than fuel and not 
unfairly penalized, and liability is addressed.
    We believe the time has come for Congress to put in place a federal 
policy to protect against the worst impacts of climate change. Taking 
action now allows us to meet the challenge at the lowest overall cost 
to society. We believe a market-based price on carbon is the most 
efficient and effective way to lower greenhouse gas emissions. Dow has 
been working proactively through trade associations and coalitions to 
advocate for a federal solution. We are proud to be founding members of 
the newly announced CEO Climate Dialogue, a group of U.S. and global 
Fortune 500 CEOs that are committed to advancing climate action. The 
goal of the group is to urge Congress to enact a market-based approach 
to climate change.
    To the extent that Congress considers a policy framework to address 
climate change, we believe public policy should:
           Recognize and value the chemical industry's use of 
        hydrocarbon feedstocks (in both traditional and nontraditional 
        forms) that are transformed into products rather than emitted 
        as CO2.
           Eliminate federal regulations that are made 
        duplicative or unnecessary through the enactment of 
        comprehensive federal regulations.
           Prioritize regulations at the federal level instead 
        of creating a patchwork of state and/or regional levels. 
        Regulations should be harmonized, and state and/or regulations 
        made duplicative or unnecessary should be eliminated.
           Recognize industry's allocation of time and 
        resources to deliver efficiencies and breakthrough innovation 
        by protecting it from the broad legal liabilities of climate 
        change.
           Dedicate revenue generated as a result of carbon 
        pricing exclusively to developing new technologies to avoid 
        future emissions, and/or support infrastructure required to 
        capture emissions or enable lower carbon emissions.
           Establish a standard protocol to account for the 
        emissions that are avoided through the use of manufactured 
        products, and generate credits that can be applied against the 
        emissions of the manufacturer. Similar protocols should be 
        established for re-used CO2 (i.e. through Carbon 
        Capture and Utilization).
    The key to continued manufacturing competitiveness is a well-
executed, comprehensive energy policy which addresses supply and 
demand, energy security, and environmental objectives.
                               conclusion
    Thank you for the opportunity to share Dow's perspective on 
reducing industrial sector greenhouse gas emissions, and the actions we 
have taken to reduce the impact of our own operations and those of our 
customers. There is an important role for Congress to play in crafting 
a federal regulatory framework that achieves meaningful emissions 
reductions at the lowest possible cost to society. We look forward to 
working with members of the Committee and all interested stakeholders 
on this important issue.

    Ms. Castor. Thank you very much.
    Ms. Lipman, you are recognized for 5 minutes.

                    STATEMENT OF ZOE LIPMAN

    Ms. Lipman. Thank you, Chairwoman Castor, Ranking Member 
Graves, and distinguished members of the select committee. My 
name is Zoe Lipman, and I am the director of the Vehicles and 
Advanced Transportation Program at the BlueGreen Alliance, a 
national partnership of labor unions and environmental 
organizations. On behalf of my organization, our partners, and 
the millions of members and supporters they represent, I want 
to thank you for convening this hearing.
    Earlier this summer, BlueGreen Alliance, alongside our 
labor and environmental partners, released Solidarity for 
Climate Action, an ambitious concrete platform to address the 
dual crises of climate change and increasing income inequality, 
simultaneously fighting climate change, reducing pollution, and 
creating and maintaining good paying union jobs.
    Our plan puts American workers at the forefront of the 
discussion to fix these pressing problems. Rebuilding American 
manufacturing is a key part of this plan. We cannot rebuild 
American prosperity if we fall behind the rest of the world in 
building the technologies of the future or if working people in 
the communities they live in fail to see the gains from 
innovation and a cleaner economy.
    The next generation of investments in advanced clean 
vehicles, energy, and infrastructure must be made here and 
result in the kinds of good paying jobs that Americans need. 
This strategy should include, I will say, many of the things 
that we have heard on the panel already:
     Major new investments to spur domestic 
manufacturing of rapidly growing clean technologies, plus 
increased funding for research and development and deployment 
and to translate that innovation into manufacturing, supply 
chain development, and good jobs.
     Investments to transform our existing industries, 
spurring clean and efficient domestic materials production, and 
to make energy intensive industries more efficient and 
competitive globally.
     A focus on environmentally, economically, and 
socially responsible mining, reclamation and recycling of the 
materials necessary for a clean and secure future; and strong 
labor, environmental, procurement, and safety standards to 
strengthen manufacturing and ensure good paying jobs across 
these advanced technology fields.
    This includes using tools proven to create and improve job 
quality, like project labor and community benefit agreements, 
Buy American, Davis-Bacon prevailing wage, and policies that 
ensure the use of domestic, clean, and safe materials made by 
law-abiding corporations for all public spending and across the 
supply chain.
    Finally, fair and enforceable trade agreements are critical 
and so are common sense tax, procurement, and border adjustment 
policies to stop offshoring either jobs or pollution overseas.
    Over the past decade in the auto sector, for example, 
American workers and businesses have proven that we can rebuild 
American manufacturing through strong action on climate. Today, 
in a recovered profitable and competitive industry, hundreds of 
thousands of American manufacturing workers are building the 
advanced components, materials, and technology that go into 
making our cars, trucks, and SUVs cleaner while saving 
consumers billions and deeply cutting emissions. Unfortunately, 
just as smart policy choices aided in manufacturing recovery, 
poor choices will cost them.
    The administration's moves to roll back these long-term 
standards threaten more than 89,000 of tomorrow's manufacturing 
jobs. We cannot afford to go backward. We need to retain and 
extend globally leading standards and we need to act now in an 
aggressive agenda to manufacture the next generation of 
advanced and electric vehicles, materials, and technology in 
the United States.
    There is no doubt that the energy, transportation, and 
technology sectors are changing rapidly, and all too often, 
workers have borne the brunt of change. But while technological 
change is inevitable and necessary, wasteful and inequitable 
disruption is not. Nothing should stop us from building clean 
energy technology with good jobs in America, but it doesn't 
happen by itself.
    In some factories, for example, EVs and EV components are 
built on the same production lines in the same plants with the 
same good union jobs as conventional technology, but not enough 
of our clean vehicle and clean energy jobs are good paying 
family supporting jobs and not enough are in communities that 
have seen good jobs disappear. Creating high-quality jobs 
across the country, especially in clean energy, vehicles, 
efficiency adaptation, and resilience, requires strengthening 
workers' rights on the job, removing barriers to organizing, 
and raising and extending labor standards, plus a serious 
investment in work-based training and apprenticeships and 
reinvestment in hard hit communities across the nation.
    To rebuild American prosperity, the clean economy must go 
hand-in-hand with making high-quality, family-sustaining union 
jobs accessible to all. Adopting an aggressive, worker-centered 
agenda to address the climate crisis will build a stronger U.S. 
manufacturing sector, benefit workers, communities, the 
economy, and the environment.
    Thank you for this opportunity. I look forward to your 
questions.
    [The statement of Ms. Lipman follows:]

                        Testimony of Zoe Lipman

   Director, Vehicles and Advanced Transportation Program, BlueGreen 
                                Alliance

   Before the U.S. House of Representatives, Select Committee on the 
                             Climate Crisis

  Solving the Climate Crisis: Manufacturing Jobs for America's Workers

                           September 10, 2019

    Thank you Chairwoman Castor, Ranking Member Graves, and 
distinguished members of the select committee. My name is Zoe Lipman, 
and I am the Director of the Vehicles and Advanced Transportation 
program of the BlueGreen Alliance, a national partnership of labor 
unions and environmental organizations. On behalf of my organization, 
our partners, and the millions of members and supporters they 
represent, I want to thank you for convening this hearing today 
regarding the opportunities that the clean energy economy can provide 
to rebuild American competitiveness manufacturing and good jobs.
    Our nation faces the dual crises of climate change and increasing 
economic inequality. These crises are inextricably linked, as are their 
solutions.
    That's why earlier this summer the BlueGreen Alliance, alongside 
our labor and environmental partners, released Solidarity for Climate 
Action, an ambitious, concrete platform to address these crises 
simultaneously, fighting climate change, reducing pollution, and 
creating and maintaining good-paying, union jobs across the 
nation.i
    We need to plan for the future and American workers must be at the 
forefront of that discussion.
    One key strategy for tackling both climate change and the 
challenges faced by working people nationwide is rebuilding American 
manufacturing. We recognize that we cannot rebuild prosperity if we 
fall behind the rest of the world in building the technologies of the 
future, or if working people and the communities they live in fail to 
see the gains from innovation and a cleaner economy. We need to act now 
to ensure the next generation of investments in advanced, clean 
vehicles, energy, and infrastructure are made here in the United States 
and that those investments result in the kinds of good-paying jobs that 
are out of the grasp of too many Americans.
    In Solidarity for Climate Action, the BlueGreen Alliance and our 
partners call for aggressive action to ensure that America remains 
competitive, that our manufacturing sector is strong, and that we 
retain our spot as an innovative leader. The nation needs a national 
strategy to lead in clean and emerging technology production, 
including:
     Major new investments to spur domestic manufacturing and 
supply chain development in rapidly growing clean technologies, as well 
as increased funding for research, development, and deployment to 
ensure that American innovation is translated into good jobs and 
cutting edge manufacturing in the United States;
     Investments to transform our existing industries, 
including investing in efficient domestic materials production and 
energy-intensive manufacturing to both limit emissions and make them 
more efficient and competitive globally;
     A focus on environmentally, economically, and socially 
responsible mining projects, as well as reclamation and recycling 
initiatives to ensure we're creating the materials necessary for a 
clean and secure energy future here in the United States;
     Strong labor, environmental, procurement, and safety 
standards to strengthen manufacturing and ensure that jobs across these 
advanced technology fields are good-paying jobs. This includes using 
tactics proven to create and improve job quality--like project labor 
and community benefit agreements, Buy American, Davis-Bacon prevailing 
wage, and policies that ensure the use of domestic, clean, and safe 
materials made by law-abiding corporations--for all public spending and 
throughout the supply chain;
     Ensuring that trade agreements are enforceable, fair for 
all workers, and benefit the environment and the climate; and
     Using common sense tax, procurement, trade enforcement, 
and border adjustment policies to stop offshoring and the leakage of 
jobs--and pollution--overseas.
    Rebuilding American manufacturing through leadership on climate 
action is not just possible in theory. Over the past decade American 
workers and businesses have proven that theory in the in the auto 
industry. Building on bipartisan agreements in 2007 energy bill, a new 
generation of strong, smartly structured clean vehicle standards--
coupled with deliberate manufacturing policy and investment--not only 
helped avoid catastrophe at the heart of U.S. manufacturing, but sped 
up the recovery, rebuilt automaker profitability and competitiveness, 
and brought back hundreds of thousands jobs, all while building 
exceptional vehicles that deeply cut pollution and saved consumers and 
businesses money.
    The BlueGreen Alliance and its partners have long tracked the 
impact of standards on manufacturing jobs and investment in the auto 
industry. Under globally leading fuel economy and greenhouse gas (GHG) 
standards, automakers and suppliers invested billions in innovative 
plants and technology in the United States,ii and across the 
country, hundreds of thousands of manufacturing workers are building 
the advanced components, materials and technology that goes into 
cleaner cars, trucks, and SUVs. What's more, taken together, the 
vehicles built today are achieving the nation's largest ever reductions 
in climate pollution.
                             policy matters
    Unfortunately, just as sound policy choices helped underpin a 
recovery in manufacturing in America's auto industry, stepping back 
from globally leading standards will cost them. Recent efforts by the 
administration to rollback these long-term standards--together with 
counter-productive corporate tax incentives that further discourage 
investment in domestic manufacturing and workers--are threatening these 
gains. They are putting today's and tomorrow's jobs at risk, driving 
future manufacturing investment overseas, and setting us back in an 
urgent race to attract the next generation of advanced and electric 
vehicle technology in the United States.
    Data from the Environmental Protection Agency (EPA) and National 
Highway Traffic Safety Administration's (NHTSA) shows the proposed 
rollback would cut approximately $30 billion per year in investment in 
advanced technology and cost 60,000 jobs, and that's without taking 
into account the potential impact of missing the boat on the next 
generation of automotive innovation in America. A recent analysis 
conducted by the BlueGreen Alliance looking specifically at the impact 
on manufacturers who build advanced vehicle technology in the United 
States, found the potential impact on jobs to be even more substantial, 
concluding that the proposal would result in more than 89,000 of 
tomorrow's jobs lost or foregone.iii
    At a time when countries worldwide are rushing to capture the next 
generation of vehicles, manufacturing and jobs, we cannot afford to go 
backward. We need to retain and extend globally leading vehicle 
standards, and we need to act now on an aggressive agenda to 
manufacture the next generation of advanced and electric vehicles--and 
the strategic materials and technology that goes into them--in the 
United States.
  now is the time for an advanced and electric vehicle manufacturing 
                                 agenda
    An advanced and electric vehicle manufacturing agenda would couple 
strong globally leading standards and targets, which give companies the 
certainty they need to invest, with an aggressive push to manufacture 
vehicles and strategic components here in the United States. The key 
elements of that agenda include:
     Make a robust investment to spur advanced and electric 
vehicle and technology manufacturing and supply chain--whether through 
new programs or through expansion of the loan, grant, and tax programs 
we have today to help companies build, retool, or convert manufacturing 
plants in America. Further, to enhance the benefits for the economy, 
communities, and working people, we should:
                   Incentivize responsible labor, 
                community, and supply chain practices and prioritize 
                reinvestment in existing or idle facilities and in 
                deindustrialized, impacted, underinvested communities;
                   Prioritize economically strategic and 
                emerging technology and materials; and
                   Encourage consortia of assemblers and 
                suppliers--and small- and medium-sized manufacturers--
                and aid states and municipalities in investing in local 
                priorities and clusters.
     Act to responsibly produce critical minerals and materials 
and to launch new domestic recycling and reclamation projects;
     Boost public investment in electric vehicle (EV) fleets 
and infrastructure and ensure that all public spending supports efforts 
to build critical components here and to secure and build good family 
supporting jobs;
     Make globally competitive levels of investment in research 
and development and ensure innovation is translated into domestic 
manufacturing and growth of supplier networks; and
     Enact fairer trade, labor, and corporate tax policies that 
can stem advanced tech offshoring and exploitative labor practices 
while driving a new generation of investment in domestic plants, 
workers, and training.
    Finally, the experience, opportunities, and challenges we have in 
the iconic auto industry underscore some broader lessons for how we 
ensure the clean economy, innovation, and technological change deliver 
to working people.
       the clean economy can and must deliver for working people
    Energy, transportation, tech industries are changing rapidly. This 
is both a tremendous opportunity and a significant challenge. All too 
often in recent decades workers have borne the brunt of change. But 
what we've seen is that while technological change is inevitable, 
wasteful and inequitable disruption is not.
    Nothing should stop us from building clean tech with good jobs in 
America--but it doesn't happen by itself. In the auto industry for 
example, in many factories, EVs and EV components are built on the same 
production lines, in the same plants, with the same good union jobs, as 
conventional vehicles. If anything, higher labor standards and better 
working conditions in parts of the industry enable more effective and 
efficient manufacturing systems.
    The technology does not dictate job quality, or whether we rebuild 
Americas manufacturing vitality, but the choices corporations and 
policy makers make on offshoring and outsourcing and investing in 
workers and communities do. In this industry, we've shown that, with 
smart policy developed with stakeholders at the table, successful 
innovation can be an industrywide undertaking, not a zero sum game. We 
can engage every part of the industry and secure and build jobs across 
existing and emerging technologies, while innovating across all types 
of vehicles and delivering gains for all types of consumers, and we can 
achieve--indeed perhaps it's the only way to achieve--groundbreaking 
pollution reductions.
    And, as we move to clean and innovative mobility across the 
transportation sector, it's not just manufacturing jobs at stake, and 
having labor and community stakeholders at the table makes all the 
difference. New research shows that in commercial transportation--where 
drivers are contingent or often misclassified as independent 
contractors--deployment of clean technology can also be more 
difficult.iv Similarly, in the absence of clear standards, 
new ``innovative mobility`` technologies like autonomous vehicles, ride 
sharing, and ride hailing may not deliver on promised labor, safety, 
equity, and environmental benefits. Proactive engagement of 
stakeholders and agreed public policy framework are critical to ensure 
the public sees the benefits of technological change, and this would 
shape innovation itself--helping to guarantee that we do not lock in 
innovative technology with exploitative business models.
    These lessons hold true across the clean economy. We have the 
opportunity to retain and create millions of high quality jobs while 
implementing bold solutions to climate change. We know this is possible 
because we are building good high skilled union jobs today in 
manufacturing and in the trades in transit, energy efficiency 
retrofits, pipefitting and offshore wind, just to name a few. At the 
same time not enough of the clean energy jobs created or promised are 
good-paying, family--supporting jobs, nor are these jobs in communities 
that have seen good jobs disappear. The clean economy must do more for 
working people who have seen wages fall, and economic mobility and 
power in the workplace decline. Unions--which empower workers, ensure 
quality jobs, and sustain families--are an essential vehicle to 
confront the economic insecurity most Americans face.
    A commitment to high-quality job creation across the economy--but 
especially related to clean energy, vehicles, adaptation and 
resilience--means strengthening workers rights on the job, removing 
barriers to organizing, raising and extending labor standards, 
investing in work-based training, registered apprenticeships, enhanced 
equity, community benefits and community preparedness. To rebuild 
American prosperity, the future of energy, manufacturing, 
transportation, infrastructure, and resilience must go hand in hand 
with making high-quality, family-sustaining, union jobs accessible to 
all.
                               conclusion
    Today, our key economic and political challenges include 
reorienting the American economy around the essential and growing clean 
and resilient technologies of tomorrow, while addressing the challenges 
working people are facing right now. Acting now to adopt an aggressive, 
worker-centered agenda to address the climate crisis is amongst the 
most compelling opportunities we have to meet America's challenges and 
capture its most exciting opportunities--for the U.S. manufacturing 
sector, workers, communities, the overall economy, and the environment.
                               references
    i BlueGreen Alliance, ``Solidarity for Climate Change,'' 
June 2019. Available online: https://www.bluegreenalliance.org/
solidarity
    ii BlueGreen Alliance, Driving Investment: How Fuel 
Efficiency Is Rebuilding American Manufacturing, January 25, 2018. 
Available online: https://www.bluegreenalliance.org/resources/driving-
investment-how-fuel-efficiency-is-rebuilding-american-manufacturing/
    iii BlueGreen Alliance, Tech@Risk: The Domestic 
Innovation, Technology Deployment, Manufacturing, And Jobs At Risk In 
Stepping Away From Global Leadership On Clean Cars, August 1, 2019. 
Available online: https://www.bluegreenalliance.org/resources/techrisk-
the-domestic-innovation-technology-deployment-manufacturing-and-jobs-
at-risk-in-stepping-away-from-global-leadership-on-clean-cars/
    iv UC Berkeley Labor Center, Truck Driver 
Misclassification: Climate, Labor, and Environmental Justice Impacts, 
August 22, 2019. Available online: http://laborcenter.berkeley.edu/
truck-driver-misclassification/

    Ms. Castor. Well, thank you to all of the witnesses for 
your very compelling testimony. I recognize myself 5 minutes to 
ask questions.
    I have to say, after touring through Illinois and Michigan 
during August, my great takeaway was, boy, the global race is 
on for building the fuel-efficient and electric vehicles of the 
future. I heard from the experts at GM and Ford, how they are 
going all in on electric vehicles, but they are very afraid 
that U.S. policy is going to take a backseat and let other 
countries capture the market, because this is a very 
competitive global market.
    And I think the average person, the average American 
understands that when you have a more fuel-efficient vehicle or 
an electric vehicle, you are going to save money at the pump 
and there are significant health benefits. Gosh, the electric 
school buses of the future--I see that over time, all the 
school districts are going to be driving electric school buses 
because of the benefits, but there are some very significant 
roadblocks right now.
    Ms. Lipman, you highlighted that everyone understands how 
the Trump administration is trying to roll back fuel economy 
standards. There is a huge fight on. Go into a little more 
detail for us on how globally leading fuel economy and emission 
standards help create more manufacturing jobs in America and 
investment by the U.S. auto industry.
    Ms. Lipman. I would be happy to, and this is something we 
have been tracking for years. In this sector, we really have an 
example of how globally leading emission standards coupled with 
deliberate manufacturing policy have underpinned a dramatic 
recovery in the industry, bringing back hundreds of thousands 
of jobs, returning to record sales, profitability, and 
competitiveness for the industry.
    In 2017, we found 288,000 manufacturing workers in 1,200 
factories and 48 States building the specific technology that 
goes into improving fuel economy and creating advanced 
vehicles. We also saw over $76 billion invested just by the 
automakers alone (the previous numbers included the suppliers). 
Some of this was certainly business as usual, but much 
additional came from retooling factories more frequently, 
buying additional technology, and enhancing investment in 
innovation, and it illustrated how investments to meet these 
standards translated directly into a multibillion dollar 
investment in manufacturing communities across the country.
    Unfortunately, just as smart policy underpinned the 
recovery, bad policy can reverse it. And as I mentioned in my 
statement, we are seeing a proposal to roll back these policies 
today. The administration's own analysis of the rollback found 
that it would result in $30 billion a year less in 
manufacturing investment and a loss of 60,000 future jobs. We 
find in analysis we just completed, more than 89,000 jobs could 
be foregone in the future.
    Strong long-term standards not only boost investment in 
manufacturing directly, but they provide the certainty for 
companies to make decisions about whether or not to invest in 
America for the long term, and we risk losing that next 
generation of technology just at a time when countries 
worldwide----
    Ms. Castor. Well, and I want to get Mr. Nassar's comment on 
this because I am hearing it from workers too. They want these 
jobs. They know these are the jobs of the future. They don't 
want the electric vehicles to be built in China and have China 
eat our lunch. We need to be the leader. So what is your view, 
what is UAW's view of the Trump rollback of fuel economy, and 
what else do we need to be doing to make sure the Trump 
administration doesn't undermine consumers and their pocket 
books and good American jobs?
    Mr. Nassar. Well, I think--first of all, thank you for the 
question. I think as far as the preferred alternative that the 
administration put forward by flatlining standards in the years 
ahead, it really goes backwards from investments that are 
already being made, first of all, because the automakers have 
to plan well in advance so it is a problem. It is also leading 
to an awful lot of litigation and uncertainty of where we are 
heading, and that is creating a lot of problems.
    We worked hard with a lot of stakeholders to build a 
consensus before and we could do it again; we just need the 
political will to do that.
    Ms. Castor. Great. Mr. Griffith, I recognize you for 5 
minutes.
    Mr. Griffith. Thank you very much, Madam Chair, and I 
appreciate it.
    I want to start by looking at a concept that Mr. Stones put 
forward in his written testimony, which was the trilemma, the 
energy trilemma which states that you have got to try to 
balance all three: affordability, sustainability, and 
reliability. And I think all of those are important, and 
sometimes we forget about that.
    And, Mr. Shah, I like a lot of things, believe it or not, 
that the Department of Energy did when you were there, because 
I am big on research. The one thing I would point out, when we 
are looking at this trilemma of affordability, is that we need 
to be doing research on not just the renewables and increase 
that research, but we need to have parity with our fossil fuel 
research as well.
    And I would point to an article that appeared in the 
Roanoke Times on August 18 of this year, where it talks about a 
new technology that is being developed in my district in 
Pulaski County, and Virginia Tech is now working on it to come 
up with a prototype, based on a decade of work, roughly, where 
they are using solid sorbents. They create a filter which can 
be used on smokestacks of any manufacturing facility or coal-
fired power plant. And what it does is, is that the emissions 
come through this filter, it has got different compartments 
with the solid sorbents, if I am saying that correctly, and 
what happens is, is that there is a combination; the chemicals 
then combine with the various things that we don't want in our 
air--carbon dioxide, SOX, NOX, et 
cetera--pulls it out, but it leaves it in a form because it is 
not a jumbled mess. Most of the filters today can filter that 
stuff out, but you end up with a jumbled mess that you can't 
sell. This gives you a product you can sell so you can sell the 
nitrogen to fertilizer companies. You can sell the arsenic to, 
you know, folks who use arsenic for poisons or whatever they 
are using it for, and you can pull out the carbon.
    So what do you say about that? I mean, shouldn't we be 
increasing--instead of putting all of our eggs into the basket 
of the renewables where everybody is working on it, but as a 
fossil fuel rich country, shouldn't we also be doing a lot of 
research to clean up the fossil fuel production that we have or 
whatever manufacturing? And this seems like a great project 
among many others, I am sure.
    Mr. Shah. Absolutely. This is a huge global economic 
opportunity and we have got to be working on every sector. When 
you look at the IPCC reports, they say that we are not going to 
be able to achieve the two-degree scenario without both carbon 
capture use and sequestration and advanced nuclear, in addition 
to renewables and storage and all. So it is ``and, and, and''. 
We have got to do it all. And you know what? Virginia Tech is 
leading the way.
    Just earlier this year, they got $2.4 million from DOE's 
Fossil Energy Office to look at how to produce ammonia more 
efficiently. So, you know, we got to work across the board, and 
I think you are absolutely right.
    Mr. Griffith. Well, I appreciate that very much.
    Mr. Stones, I imagine Dow might be very interested in that 
kind of technology as well.
    Mr. Stones. Well, we do provide, you know, products to help 
with carbon capture. We believe very strongly that carbon 
capture is one of the processes required to deal specifically, 
especially with processed heat, which is a very important issue 
for our industry.
    Mr. Griffith. Well, what I love about this one--and I hope 
it takes off. I don't know if it will or not, but this is what 
research is about, is trying to figure out different things 
that will happen. But what I love about this is, is that we can 
do all kinds of things with it and you end up with a product 
you can then resell; you just don't have to store it away 
somewhere or isolate it, and I think that is great.
    And when you are looking at your trilemma and you look at 
affordability--by the way, that is MOVA, I am always looking 
for investment in my district, so you might check them out, 
have your folks check them out. But I was recently in Turkey on 
this same line trying to find some manufacturing jobs for one 
of the counties in my district that wanted their--they are 
targeting some Turkish companies, and one of the questions that 
every manufacturer asked us was, what is the cost of your 
energy? And I think that is important.
    And you pointed out we lost 200,000 jobs when we didn't 
have the feedstock. That translates to coal and natural gas 
feedstocks from making chemicals, doesn't it? And when the 
price went up so high it wasn't affordable, we lost those jobs 
elsewhere. When the price of natural gas came down because of 
research and development, those jobs came back, did they not?
    Mr. Stones. Yeah. So I think----
    Mr. Griffith. The answer is yes. You can keep go ahead, but 
I want to make sure everybody understands the answer was yes.
    Mr. Stones. I think what happened in that instance is that 
technology and innovation led to revitalization of the energy 
economy and specifically initially around shale gas, but then 
eventually around shale oil.
    Mr. Griffith. And I think if we get parity between 
renewables and fossil fuels, we can have more breakthroughs 
that will continue to have some of our traditional jobs but at 
a cleaner output. And I appreciate it.
    My time is up, and I have to yield back. Thank you, sir. 
Look forward to discussions down the road.
    Ms. Castor. Ms. Bonamici, you are recognized for 5 minutes.
    Ms. Bonamici. Thank you, Chair Castor. Thank you to all of 
our witnesses.
    I am glad that we are focusing on manufacturing jobs for 
America's workers today. I think this is a conversation we need 
to have every time we are talking about the climate crisis and 
especially with the focus on transportation today.
    As the chair said, the global race is on, and as Mr. Nassar 
and Ms. Lipman noted, why would we go backwards when other 
countries are going forward. It just doesn't make any sense.
    We talk a lot here on the Hill about infrastructure and 
passing an infrastructure package. Look at all the potential 
with charging stations and the technologies with fast charging, 
and there is just so much that can be done and there are a lot 
of jobs in that.
    So we know that we need to reduce harmful emissions. We 
know, as we transition to a clean energy economy, that we need 
significant Federal investment in research and development of 
advanced clean energy technologies. I also serve on the 
Science, Space, and Technology Committee, so we look at 
complementing Federal high-risk, high-reward programs like 
ARPA-E, with regional partnerships that could spur the 
development of both early stage innovation and help move new 
technologies beyond laboratory research to market development.
    I am actually working on a bill to support the creation and 
expansion of regional public-private partnerships to foster 
that environment of innovation and job creation at the local 
level, but also part of that is to accelerate smart market 
deployment of clean energy technology.
    So, Mr. Shah, you in your testimony did talk about the 
value of the DOE supporting both the initial research and 
development of clean energy technologies and the subsequent 
innovation in manufacturing to drive down market costs. So how 
can we strengthen research and development to avoid that 
commercialization valley of death that we hear about for new 
clean energy technologies and support the supply chains for 
accelerated clean energy development?
    Mr. Shah. Thank you for the question. You know, I think you 
are absolutely right, we need to do this. We need to support 
innovation ecosystems, and the way do that is to take a 
holistic approach, where we adequately fund R&D, we adequately 
fund deployment, and we support workforce development for the 
industries of the future.
    So in Oregon, for example, DOE has been supporting NuScale, 
and advanced nuclear is a big, hard problem. And it has taken 
years of investment, but for nearly a decade now, DOE has been 
seeding this industry through investments in companies like 
NuScale. They have completed their first initial reactor design 
which is under review, and that was done with Federal support. 
They are now seeking long-term purchase contracts. They are 
working with DOE and Congress to determine how to build 
manufacturing capacity here. And what is exciting and important 
about that is it is not just for domestic industry, but it is 
also a huge potential export opportunity.
    So I think to answer your question, you just have to look 
holistically. We have to think about industrial policy, not 
just doing one or the other; we have to do it all.
    Ms. Bonamici. Thank you. And NuScale is not like the old 
nuclear reactors, just like manufacturing jobs of today are not 
like the old manufacturing jobs of the past.
    So, in Oregon, on the workforce issue, we have numerous 
examples of strong registered apprenticeship programs that have 
the training, the portable credentials, high wages, and a 
pathway to a permanent job. We have the Oregon Manufacturing 
Innovation Center that is kind of a public-private partnership 
with academia and the workforce.
    So, Ms. Lipman, Mr. Shah, Mr. Nassar, you all highlight how 
the clean energy sector could help create high-quality good 
paying jobs. Registered apprenticeships and paid on-the-job 
training opportunities provide us with an opportunity to 
support individuals that might face barriers. So where do you 
see Federal workforce investments being the most useful--
preapprenticeship programs, sector partnerships, more 
registered apprenticeships? Where do you think the best 
approaches are? Maybe just quickly because I am running out of 
time. Thank you.
    Mr. Nassar, go ahead.
    Mr. Nassar. Just really quick. Well, I think, frankly, once 
again, all of them are needed, but one thing that is going on 
is the administration, unfortunately, has a proposal on 
apprenticeships which would actually bring things backwards 
because it would let apprenticeships move forward that have 
much lower standards.
    Ms. Bonamici. Not a supporter of IRAPs.
    Mr. Nassar. And we collectively bargain, by the way, for a 
lot of these good apprenticeship programs.
    Ms. Bonamici. Okay. I am going to let Ms. Lipman get an 
answer in quickly.
    Ms. Lipman. Yes. I would underscore the importance of work-
based training and registered apprenticeship, preapprenticeship 
programs. I would say we also are very proud that our full 
partnerships supported the PRO Act and the importance of 
raising labor standards, facilitating workers' rights in 
organizing, and the ability to secure and improve jobs.
    Ms. Bonamici. Absolutely. We want these to be good paying 
jobs.
    And I see that my time is expired. I yield back. Thank you, 
Madam Chair.
    Ms. Castor. Thank you.
    We have three votes on the floor. So at this time, the 
committee will recess, and then we will reconvene 5 minutes 
after the last vote is called.
    Thank you.
    [Recess.]
    Ms. Castor. Okay. The committee will come to order.
    Mrs. Miller, you are recognized for 5 minutes.
    Mrs. Miller. Thank you, Chairwoman Castor and Ranking 
Member Graves, and to all of you-all for being here today.
    Mr. Stones, how has the cost of energy changed over the 
last 15 years?
    Mr. Stones. So over the last 15 years, the price of energy 
has been relatively volatile, and it has ranged from a period 
of history where the United States has been very, very 
competitive on energy. There was a period of time in the 2001 
to 2007 period when it wasn't.
    But natural gas, for example, has traded probably between, 
frankly, zero and maybe $25 a million BTU, and probably is 
about 2.50 right now.
    Mrs. Miller. So, basically, right now it is down?
    Mr. Stones. Right now, technological innovation has 
occurred in the oil and gas space which allows a reduction in 
the cost of those--of energy in both natural gas and oil. But 
we have also seen a significant decrease in the price of 
renewables. So those are also much cheaper today than they were 
historically.
    Mrs. Miller. How has the low cost in energy positively 
impacted Dow's business?
    Mr. Stones. So, basically, we rely on competitive and 
reliable energy prices to remain competitive globally and 
allow, for example, the investment of approximately $12 billion 
over the last, say, 10 years in the Gulf Coast where we have 
started up a new cracker, a new propane dehydrogenation 
facility. The one we just----
    Mrs. Miller. Can you speak closer, please?
    Mr. Stones. Sorry. We have invested about $12 billion over 
the last 10 years or so in the Gulf Coast to produce more 
products here, including a new ethylene cracker and a new 
propane dehydrogenation facility and the derivatives thereof.
    Mrs. Miller. So that is a good thing?
    Mr. Stones. It is a good thing, yes.
    Mrs. Miller. Okay. Mr. Nassar, how important is the price 
of electricity in manufacturing vehicles?
    Mr. Nassar. Oh, it is absolutely an important input, for 
sure. No question about that.
    Mrs. Miller. How important is that same price in 
maintaining manufacturing jobs?
    Mr. Nassar. The price of electricity is an important 
aspect, but it is one of many. I would say trade policy and a 
whole bunch of other things too are important in whether those 
jobs are here or elsewhere.
    Mrs. Miller. If the price of electricity were to triple, 
how would that impact jobs and union jobs in manufacturing?
    Mr. Nassar. Well, I would need to get back with you with 
precise numbers. I don't have that. But whenever you have major 
increases in costs, you know, that is going to impact the 
bottom line, which will impact employment for sure.
    Mrs. Miller. Absolutely.
    Mr. Shah, can you elaborate on successful carbon capture 
projects in the United States?
    Mr. Shah. Sure. The United States has some very large 
carbon capture facilities, including Petra Nova, which is a new 
facility that has been stood up in Texas. In addition, there is 
a facility in Illinois that sequesters carbon that comes out of 
an ethanol plant. So it is a technology that remains nascent, 
but if we are to maintain 2 degrees or less of warming, we 
really need to ramp up CCUS technologies, along with a whole 
host of other clean energy technologies like renewables and 
storage.
    Mrs. Miller. Are there any other plants in the making that 
you can see?
    Mr. Shah. There are. But again, this is a new industry, and 
additional Federal support could help speed deployment of these 
types of facilities.
    Mrs. Miller. Thank you.
    How can we reduce the price of carbon capture so that it is 
able to be exported globally?
    Mr. Shah. Right. I think that is exactly the right 
question, how do we create the manufacturing jobs to build 
carbon capture technologies here in the U.S. and move them to 
the rest of the world. And I think, as with many other nascent 
industries, Federal support has been really important in the 
past. So the U.S. Department of Energy Office of Fossil Energy 
is focused on carbon capture utilization and sequestration 
technologies, has been really important in the past, and I 
think that Congress should continue its strong support there.
    Mrs. Miller. Thank you. I yield back my time.
    Ms. Castor. Thank you. Ms. Brownley, you are recognized for 
5 minutes.
    Ms. Brownley. Thank you, Madam Chair.
    And I certainly concur with your comments at the beginning 
of the meeting that we are in a global race towards the clean 
energy future, without question.
    I was recently in India and was there for India's 
independence day and had a chance to hear the President of 
India speak. And during that speech, he set some very, very 
high standards for India with regards to electrification of his 
country as well as electric vehicle goals.
    And so, you know, thinking about that race, there is China 
that is literally next door, and China is leading the way in 
this area, and they will be the ones to capture that market. 
And India is a very valuable market and would give us huge 
export opportunities in this space. It is the most populated 
country in the world, and 10 years from now, it is going to be 
the third largest economy in the world. So we need to get 
going.
    So, Mr. Nassar, I wanted to ask you, in your written 
testimony, you talked about some of the things that other 
countries are doing to develop the automobiles and technologies 
of the future, and you referenced the country of Germany. And 
you said they were investing in its citizenry. What do you mean 
by that exactly?
    Mr. Nassar. Well, first of all, they have a dual path, 
right? They have a path when it comes to--you know, kind of 
university, traditional academic, but they also have a, you 
know, manufacturing apprenticeship path that lasts a long time. 
But, you know, it all matters. You know, if you have a healthy 
population, you know, healthcare matters. There is a whole--you 
know, the whole litany of things as far as having a solid 
foundation for folks.
    Ms. Brownley. And so, you know, on the line of--on the line 
of apprenticeships, so, you know, in terms of looking towards 
the future, in terms of looking at new technologies, and in 
terms of automation and factories, sort of all of these 
issues--and I know labor unions across the country, they all 
have--you know, internally, within their own organizations, 
they have apprenticeship programs for their particular trade, 
and some of these emerging technologies and job possibilities.
    Can you speak a little bit to what unions are doing across 
the country in relationship to apprenticeships for the future?
    Mr. Nassar. Sure. Well, I think, first of all, you know, 
this is an area where collective bargaining, where workers 
having a voice really matters, because a lot of the 
apprenticeship programs and investments are agreed to in the 
context of a collective bargaining agreement.
    But a lot of times, what it is, is it is really focused on 
making sure incumbent or existing employees, you know, have the 
skills to do the--to upgrade to do the new jobs. So it is not--
you know, part of it is trying to get new folks into the 
stream, but it is also trying to make sure the people that are 
already working there, you know, can take those jobs as they 
advance.
    Good communication and work between the company and the 
workers is key. And I would argue labor unions help that, not 
hurt it.
    Ms. Brownley. Thank you.
    And the last question I really have, and it is really for 
anybody on the panel that would like to answer it. In terms of, 
you know, in the Trump administration, in the Department of 
Energy, EPA, there have been so many rollbacks that have taken 
place. And we do know that there is an employment dip in the 
last two--in the first two quarters, I think, of this year.
    Does anybody have any data in terms of a relationship of 
rollbacks and workforce? I mean, intuitively you would think, 
yes, there is a nexus there. Or is it a drop in the economy 
or----
    Ms. Lipman. Certainly. Rolling back regulations has really 
been shown over the last several years not to be what either 
manufacturing or workers need. I mentioned earlier the sort of 
grave potential impacts on manufacturing jobs from the 
automotive rollback. Similarly, our methane rules would 
potentially build jobs across that sector.
    We also have seen rollbacks of labor standards and 
workplace safety and community and chemical safety. None of 
those are good for workers or communities and working people 
generally. And in addition, they are not what we need to--to 
build the competitive, high-skill economy for the future.
    Ms. Brownley. And with the BlueGreen Alliance--I have a few 
more seconds--I know it is basically an alliance between the 
environmental community and the labor community. Do you have 
any interaction really with private industry and your 
influence, perhaps, on what the industries are doing?
    Ms. Lipman. Absolutely. We definitely do talk with 
companies. We work with a number. And I think we would just 
underscore how important it is to bring all of those 
constituencies to the table to develop real practical policy 
that both works for the American economy and workers but also 
can deeply cut emissions.
    Ms. Brownley. Thank you.
    Thank you, Madam Chair. I yield back.
    Ms. Castor. Thank you.
    Mr. Palmer, you are recognized for 5 minutes.
    And the acoustics in this room are not very good. So for 
members and for our witnesses, speak directly into the 
microphone and try to elevate your voice a little bit. Thanks.
    Mr. Palmer. And some of us need a little help hearing 
anyway, so----
    Appreciate the opportunity to be here. Thank you, Madam 
Chairman.
    I want to follow up on Congresswoman Miller's questions 
about the price of electricity and the cost of manufacturing 
vehicles. She asked how important is the price of electricity 
regarding electric vehicle manufacturing.
    How important would that be if the government did not 
subsidize the purchase of electric vehicles? Would they be 
affordable to the average American?
    Mr. Nassar. As far as the price of electric vehicles, I 
mean, they do have to absolutely come down, but they also have 
to be more attractive to folks. That is why I think, you know, 
also investing in infrastructure matters and such. But we need 
to up the demand for electric vehicles in order to have a more 
vibrant market and make sure they are made here.
    Mr. Palmer. Well, making them more attractive, is that in 
the context of it--like a BMW is attractive to a lot of people, 
but most people can't afford a BMW. Do you mean more attractive 
that way or more attractive--did you mean more affordable?
    Mr. Nassar. I meant more affordable. But also attractive in 
the sense of people--you know, if you have more charging 
stations everywhere, then people have more confidence in their 
ability to purchase. There is some research along those lines.
    Mr. Palmer. Increasing the range?
    Mr. Nassar. Right.
    Mr. Palmer. Along the same line, though, when you talk 
about all of this in context--and I am fine with electric 
vehicles. I have actually driven a Tesla. It is quite a ride. 
Can't afford one, but quite a ride.
    If you double or triple the cost of electricity for 
manufacturing but you also double or triple the cost of 
households' electricity, that is going to have an impact on 
people's ability to buy an electric vehicle.
    Mr. Nassar. Sure. And I would also add that, you know, 
frankly, wages for a lot of manufacturing workers haven't kept 
up. And, you know, a lot of--way too many auto workers can't 
afford the products they build. And, you know, we believe the 
old Henry Ford principle in that regard.
    Mr. Palmer. Yeah. Well, you know, we get locked into this 
discussion about wages a lot of times and we lose sight of the 
fact that it is compensation. Compensation actually has gone up 
quite a bit, but it is gone up in regard to health benefits, 
what the companies are having to pay for health benefits, and 
that takes away from what can be out there on that little 
rectangle box on the check.
    But I want to point out that China's electric vehicle sales 
had grown by 126 percent, but by May of this year, I think they 
had gone down to 2 percent. And China is looking at doing away 
with their subsidies. I think they are putting about $60 
billion a year into subsidies. If you don't subsidize these 
vehicles, I think it is going to be a very difficult market, a 
very limited market.
    So to your point, we have got to find a way to make these 
vehicles more affordable, more practical for folks. 
Particularly where I live, they want to drive a full-size 
pickup because it is not just a vehicle to drive; it also has a 
utility value. And that is a big issue.
    I also want to talk about something Mr. Shah brought up 
about the--how much technology has improved our ability, 
particularly in natural gas. And there was a study that came 
out from Harvard, the Harvard Business School, and the Boston 
Consulting Group, that was entitled American's Unconventional 
Energy Opportunity. And it talked about the tremendous 
opportunities we have in reducing our trade deficit through the 
shale revolution--through the fracking revolution and shale in 
particular.
    There have been various studies done. One was by IHS in New 
York, Daniel Yergin's group--I believe it was Daniel Yergin's 
group--that showed that over a 15-year period, just in 
exporting crude oil, that it would generate another $1.3 
trillion in government revenues--new government revenues. I 
think there was another study--I can't remember who did it--
that showed that over a 20-year period, 25-year period, it 
would add a trillion dollars to GDP.
    I will commend the Department of Energy in the previous 
administration and the current administration, what is being 
done in that regard, and the people who are leading this effort 
in technology to put the United States into a position where we 
reduce our trade deficits, we make energy affordable and 
cleaner.
    And with that, Madam Chairman, I will yield the balance of 
my time.
    Ms. Castor. Thank you.
    And, Mr. Palmer, you will be interested to know when we 
visited with the automakers in Michigan a few weeks ago, they 
have big plans for electric SUVs and electric trucks. And they 
did say some will be built in the U.S., but some will be built 
overseas. So we need policies to ensure that those vehicles are 
going to be built here in the good old USA.
    Mr. Palmer. May I comment to that? Have you ever driven a 
Tesla?
    Ms. Castor. I have. And I have driven the Volt and the 
Bolt, and they are fun to drive. And I love it. You don't have 
to stop at a gas station. One of the----
    Mr. Palmer. You don't have to hit the brakes.
    Ms. Castor. No, you don't have to hit the brakes. And the 
costs are lower to maintain. There are fewer parts to them.
    So that is one of the issues we have to grapple with. There 
is a whole supply chain out there right now for building the 
parts that go into our cars. And if we are not going to have as 
many parts being manufactured in America, what are the policies 
to ensure that those manufacturing jobs stay here, that they 
expand, and we don't lose ground.
    Mr. Palmer. If I may, I would like to commend you on that 
perspective, because building these cars, and particularly the 
batteries, overseas adds to emissions. Because a lot of the 
places that are building the batteries are using coal-fired 
power generation, where here in the United States, our 
CO2 emissions have actually declined. They have gone 
up over there. So if we build them here, and we want to 
encourage you to build it all here, it actually reduces 
emissions.
    Ms. Castor. And what was interesting is that the Tesla 
battery is being built in the U.S. Some of the others are not. 
But those rare earth metals are an issue. We have talked about 
it before in the hearing, and these are the issues we have to 
grapple with as we transition to the clean energy economy.
    Mr. Palmer. Mercedes is building their batteries in 
Alabama.
    Ms. Castor. God bless America.
    And, Mr. Levin, you are recognized for 5 minutes.
    Mr. Levin. Thank you, Chair Castor. I appreciate you 
holding the hearing today. It is an incredibly important topic.
    I always remind people that jobs are the reason that this 
whole transition of clean energy economy really is a win-win. 
It is good for our planet, good for our health, and good for 
workers.
    And while my friend Mr. Graves was here, I reminded him of 
a new report that clean energy jobs in California now outnumber 
jobs in the fossil fuel industry 5 to 1. The report was based 
on an annual survey of businesses, called the U.S. Energy and 
Employment Report, which used to be put out by the Department 
of Energy but was discontinued in 2017 after President Trump 
took office. Fortunately, two nonprofits have picked up the 
ball to provide that data.
    And as Chair Castor said, the clean energy technology of 
the future can be built here or abroad. I want to ensure that 
it is built here. I have introduced the Zero-Emission Vehicles 
Act with my friend, Representative Neguse, to accelerate market 
trends and ensure that 100 percent of new light-duty vehicles 
are zero emissions by the year 2040, of new sales.
    This legislation, paired with research and development 
funding, strong labor protections, and appropriate tax 
incentives will keep our domestic automakers competitive and 
facilitate the adoption of zero-emission vehicles built here in 
the United States by American workers.
    And, Mr. Nassar, I appreciate you being here to represent 
the UAW. At home, I drive a Chevy Volt, a plug-in hybrid EV, 
built by UAW Local 22. I am very grateful to your members for 
building such a great car.
    And when I had a chance to speak with Mary Barra, the head 
of GM earlier this year, I expressed my disappointment with her 
that they were discontinuing production of the Chevy Volt. She 
assured me, however, that GM is committed to an all-electric 
future, introducing, I think, something like 20 new models, 
all-electric models, in the coming years. So I hope that they 
have a union label on them just as my Chevy Volt has a union 
label on it.
    Ms. Lipman, I wanted to ask you a couple of questions. I 
appreciated that you touched on the need in your testimony, you 
talked about developing battery reclamation and recycling 
initiatives. Lithium ion battery recycling is key to making EVs 
more sustainable, keeping battery materials in the country, and 
making the United States competitive in the battery space.
    The resale center at the Department of Energy works to 
foster the development of cost-effective battery recycling by 
stimulating research and convening experts from across the 
United States in order to drive down battery costs to DOE's 
$80-per-kilowatt-hour goal. The center also partners with UC 
San Diego, in my district, in its very important work that will 
reduce the cost of EV ownership.
    Ms. Lipman, do you see any other programs we can be funding 
or other policies that can be adopted to help develop battery 
recycling capabilities? And are there any State-level 
initiatives that can help inform our work at the Federal level?
    Ms. Lipman. Thanks. Yes. And this issue is one that has 
come up over and over again about how we ensure that the 
materials that we critically need for clean energy technologies 
are built here and that we are not offshoring either those jobs 
or the emissions.
    We would add, in addition to the valuable program you 
mentioned, that we definitely need a national strategy on how 
we ensure we have a secure and clean energy future in the U.S. 
that would include looking at the full range of production, 
recycling, and reclamation of these products and materials.
    Secondarily, we are very interested in a wide range of 
direct programs we have in the U.S. or could have around 
investing in manufacturing, our loan and grant and tax programs 
for clean energy manufacturing, and there is no reason why 
recycling and reclamation projects, especially first-in-kind 
deployment of these projects, shouldn't be included under those 
kinds of programs for support as well. There are important 
things we could do on supply chain accountability to encourage 
folks to utilize this kind of project and initiative.
    And I guess I--I don't know off the top of my head of 
programs that are helping at the State level, except to say 
that I know in conventional batteries, we used to do much more 
recycling in the U.S., and a lot of that did get offshored to 
unfortunate jobs and environmental outcomes.
    Mr. Levin. Thank you. Perhaps you can get back to us with 
any other ideas.
    And I will use the balance of my time just to mention that 
Senator Cortez Masto and I have introduced the Green Spaces, 
Green Vehicles Act which would fund charging infrastructure on 
public lands across the United States and help convert National 
Park Service and U.S. Forest Service fleets to zero-emission 
vehicles.
    Honored to be working on this issue with you, and look 
forward to more in the years to come. Thank you for being here.
    Thank you, Chair.
    Ms. Castor. Thank you.
    Well, Mr. Carter, at the outset of the hearing, I expressed 
my relief that Hurricane Dorian did not head to Coastal 
Florida, Coastal Georgia. So I know----
    Mr. Carter. Yes. Thank you.
    Ms. Castor. We have been thinking about you over the past 
few weeks. And you are recognized for 5 minutes.
    Mr. Carter. Well, thank you. I appreciate that very much.
    And I thank all of you for being here. This is certainly 
important. Manufacturing is important obviously in our Nation, 
and it is also important in the First Congressional District of 
Georgia that I have the honor and privilege of representing.
    As a matter of fact, in the Savannah area alone, we have 
over 18,000 manufacturing jobs that we value, as you can 
imagine. And as the home to two major seaports, the Port of 
Savannah, the third largest--third busiest container port in 
the country, and the Port of Brunswick, manufacturing is 
extremely important.
    I want to ask you, Mr. Stones, how important is the cost of 
energy to Dow Chemical?
    Mr. Stones. The cost of energy is critically important. It 
needs to be affordable, sustainable, and reliable. And that 
provides the competitive base of our company and our investment 
strategy.
    Mr. Carter. So do energy costs play any kind of role in 
where you decide to put a plant?
    Mr. Stones. Absolutely. We will invest where we can get the 
most competitive energy in the world.
    Mr. Carter. So how would--if you had increased energy costs 
here in the United States, what kind of impact would that have 
on your decisionmaking?
    Mr. Stones. So, you know, we--we shared that in the--the 
kind of 2001 to 2007 period, the chemical industry lost about 
200,000 jobs versus 1997. When we reinvented--you know, the 
industry had more technology, innovation in oil and gas and 
then eventually also in renewables, that helped us to make 
decisions to invest $12 billion over the last sort of 10-year 
period.
    Mr. Carter. Sure, sure. Well, you know, whether it be 
Democrats or Republicans or Independents, you know, we all want 
to curb climate change and have a greener environment and make 
our society greener. But I worry a lot about government 
mandates and specifically about the bureaucracy that sometimes 
can cause companies a lot of problems.
    And I was just wondering, can you share with us some of the 
innovations that Dow Chemical has done on your own accord to 
become greener and more efficient?
    Mr. Stones. So, you know, for example, the plant I had 
mentioned earlier, the fluidized catalytic dehydrogenation, or 
FCDh, which is a mouthful to say, is a new process technology 
which should reduce the emissions versus comparable 
technologies by about 20 percent.
    We also very much invest in our products. So, for example, 
every kilogram of silicon we sell typically saves about 20 
kilograms of CO2 emissions. We also do things like 
lightweighting for vehicles that allow dampening and sound 
insulation, among other things. We have packaging for food, 
which preserves the freshness and the cleanliness of the food, 
which is very important globally.
    And, for example, concentrated solar is developed from our 
technologies for heat transfer fluids. So investing in the 
product space as well as the manufacturing processes, because 
the--you know, for every--basically, for every kilogram of 
CO2 we use in our processes, we save two to three in 
the products, the life cycle of the products.
    Mr. Carter. And that is your own innovation; that wasn't 
anything the government was forcing you to do or mandating or--
--
    Mr. Stones. We believe in bringing to the market what the 
products that the--the industry and the companies that we serve 
want.
    Mr. Carter. And I think that is very important, because as 
we go through this process, it is going to be important for the 
private sector to be involved. So what I want to ask you is, 
how can we in government encourage that? And how can we--how 
can we incentivize that short of tax credits or whatever?
    Mr. Stones. So I think, you know, we would say that there 
is a logical place for government in things like ensuring--
carbon capture as a technology isn't that tough. You know, it 
is a known technology. It is being developed. A lot of good 
work has been done. What is difficult is carbon reuse and the 
carbon grid network that needs to be put together.
    Right now, if we had a carbon capture stream at one of our 
facilities, there is nowhere--there is nobody to take it from 
us. There is no place to store it. So enabling that grid is 
critically important in this space.
    We also need to make sure that the regulation of the energy 
industry doesn't create adverse price spikes. You know, for 
example, just this month, we had $9,000 power in Texas. You 
know, it is normally 30, just so everybody is clear. And that 
volatility needs to be, you know, managed and understood.
    Mr. Carter. Right, right. Well, let me--you know, let me 
compliment you and let you know that I applaud your efforts in 
the private sector of trying to do this. This is exactly what 
we need done. And we need the relationship and the cooperation 
of the private sector. And that is why I am so excited about 
the future, particularly as it relates to climate change, 
because I am convinced that the greatest innovators, the 
greatest scientists are right here in the United States of 
America. So I am really looking forward to this. So thank you 
very much. Thank all of you for being here.
    And I yield back.
    Ms. Castor. Mr. Casten, you are recognized for 5 minutes.
    Mr. Casten. Thank you, Madam Chair. Thank you so much to 
the witnesses.
    And I want to start--I want to--I am delighted to hear that 
there is a bipartisan commitment to cheap energy. I am 
delighted to hear this concern about making sure that we get to 
a point where fossil energy and clean energy reach cost parity. 
But we need to recognize that the fossil energy ain't going to 
be happy about that, because they are going to take a revenue 
hit.
    Clean energy is cheap energy. The idea that a commitment to 
making energy cleaner is a commitment to making energy more 
expensive, as a technical term, it is stupid.
    In 2007, the price of natural gas spiked. We all know that. 
Natural gas is a volatile commodity. Solar energy is not a 
volatile commodity. It is zero margin; it stays on the margin.
    Since 2007, the carbon intensity of the United States grid 
has fallen by 26 percent, the price of power has fallen by 6 
percent. The reason for that is completely obvious. If you 
deploy zero marginal cost technology, a commodity that prices 
on the marginal cost falls. Thank you. Let's do more of it.
    A decision not to invest in clean energy on the basis of 
economics is like a decision not to travel to Denver because 
you are afraid of shark attacks. It is dumb.
    Now, that is a tremendously great opportunity, because it 
means that we have tons of space to lower the carbon intensity 
of our grid per dollar of GDP. We can do what our trading 
partners have done. We can significantly improve the efficiency 
of our economy, both in our electric sector, making our homes 
more efficient, deploying renewables. And that is terrific, but 
it ain't going to get us all the way there.
    And I think the challenge that we have is that there are 
huge chunks of our economy that use fossil energy as a chemical 
input. And anybody who stands here and says I have a path to 
zero carbon better explain how we are going to make fertilizer, 
how we are going to make silicon, how we are going to make 
steel, how we are going to make cement, how we are going to 
feed 7 billion people without fertilizer, how we are going to 
build a solar panel on a concrete pad without silicon, cement, 
and steel.
    And, you know, there are names like Haber and Bosch and 
Fischer and Tropsch and Bessemer, who we all learn as a young 
chemical engineer, who created these processes that depend on, 
and we have an opportunity right now to invent the technologies 
that are going to get us there in the future.
    And, Mr. Shah, I was delighted to hear you give a shout-out 
to my clean energy technology bill, because that is exactly 
what we are trying to do, is saying, you know, one of the 
buckets we have got we can be greedy about. The other buckets, 
we have got to invent new stuff.
    And so my question for you, given your DOE experience, can 
you expand on what R&D is currently going on at DOE to lower 
the carbon--figure out how to make low carbon products, and 
then why--you know, given as we have advanced manufacturing op 
centers, why is it important that we consolidate and prioritize 
those activities into one space?
    Mr. Shah. Thank you. And just on the first point you made 
about wind and solar, you know, prices have gone down--thank 
you--50 to 75 percent since 2009, and more innovation and more 
deployment will help make energy even cheaper for renewable 
energy for American businesses. So wind and solar are a really 
good bet.
    Now, on the industrial sector, you know, this is a really 
hard sector to decarbonize. Added up, it is about 22 percent of 
our Nation's GHG emissions. And we have identified solutions, 
as you said, in the transportation sector, in the building 
sector, in the power sector, to reduce GHG emissions. But the 
industrial sector is big, it is hard, it is diffuse, and we are 
having a little bit of a harder time. We haven't gotten as far 
technologically as we have in these other sectors.
    You know, the Department of Energy's Advanced Manufacturing 
Office is authorized by Congress to work on industrial 
efficiency. It is not authorized right now to work on GHG 
emissions reduction, to work on industrial electrification, to 
work on alternative fuels for industrial processes.
    So the bill that you have put forward does exactly that. It 
is a big gap, one of the biggest gaps in DOE's current 
authorization. And it is part of a slew of R&D bills that are 
moving through Congress right now: wind, R&D solar, R&D grid 
modernization, storage, fossil, nuclear. It is really exciting 
to see Congress working on these bills right now, because DOE 
hasn't been reauthorized since 2005, and doing so could really 
help us move forward with climate policy.
    Mr. Casten. Terrific.
    And just with the few seconds that I have left, for Mr. 
Stones, way back when I was a young chemical engineer, I think 
Dow was the leader on polylactic acid. I did some work on 
levulinic acids and biomaterials. I know Dow has been out in 
the front on figuring out how to make nonfossil derived 
biomaterials--or hydrocarbon materials for a long time.
    Talk about what it means if DOE--you know, the Federal 
Government, in some capacity, can figure out how to make 
fertilizer without fossil fuels, plastics without fossil fuels, 
silicon, what does that mean for you, and what role do you see 
between what you can do in the private sector and where the 
need is in the public sector to lead some of that innovation?
    Mr. Stones. So we absolutely will embrace technology. We 
are very happy to work with partnerships with the governments 
and various functions.
    I am familiar with the PLA process. That actually was sold 
off many years ago. We had a really hard time making the 
economics work.
    Mr. Casten. That was a long time ago. I was in grad school.
    Mr. Stones. I understand. But certainly, you know, I think, 
you know, setting a stable power and--and working on process 
heat is incredibly important.
    We are very concerned about things like, you know, there 
being a place for us to put the carbon we captured through a 
network of carbon capture and that sort of thing. And certainly 
our products, we are going to continue innovating.
    We do produce products, for example, with different types 
of power and steam. We do use renewable steam in Latin America 
where there are trees, where they grow very quickly. It is much 
more difficult to do that in the U.S.
    Mr. Casten. Thank you. I yield back.
    Ms. Castor. Well, thank you again to our witnesses for your 
testimony.
    I would like to remind everyone what I stated at the outset 
of the hearing. The committee has issued a request for 
information. A lot of the ideas on solving the climate crisis 
are not going to come from Washington, D.C.; they are going to 
come from the private sector, experts, academics, advocates all 
across the country.
    If you go to www.climatecrisis.house.gov or find us through 
Twitter @climatecrisis, you can access our request for 
information. The deadline for proposals is November 22.
    I would also like to ask unanimous consent to enter into 
the record the UAW EV report called ``Taking the High Road: 
Strategies for a Fair EV Future'', of spring of 2019.
    Without objection.
    [The information follows:]

                       Submission for the Record

                      Representative Kathy Castor

                 Select Committee on the Climate Crisis

                           September 10, 2019

    ATTACHMENT: Taking the High Road: Strategies for a Fair EV Future. 
United Automobile Workers, 2019.
    This report is retained in the committee files and available at:
        https://uaw.org/wp-content/uploads/2019/07/EV-White-Paper-
        Spring-2019.pdf

    Ms. Castor. All members will have 10 business days within 
which to submit additional written questions for the witnesses. 
I ask the witnesses to please respond promptly if you receive 
additional questions.
    Thank you very much. The hearing is adjourned.
    [Whereupon, at 4:17 p.m., the committee was adjourned.]

     United States House of Representatives Select Committee on the

                             Climate Crisis

     Hearing on September 10, 2019, ``Solving the Climate Crisis: 
               Manufacturing Jobs for America's Workers''

                       Questions for the Record 

                              Josh Nassar

                          Legislative Director

                          United Auto Workers

                       the honorable kathy castor
    1. Do you support the United States rejoining the Paris climate 
agreement? If yes, why?
    Yes, we strongly support rejoining the Paris climate agreement. It 
is painfully clear to our members that the climate crisis is real, and 
its scope is global. International cooperation and commitment to 
action, like the Paris Climate Agreement, are a must for addressing the 
crisis. Failing to take concrete steps to address climate change at the 
global level puts us on an unsustainable course. Ignoring climate 
change only creates risks for our national security and our planet, but 
it is also a direct threat to our jobs, and an even bigger threat to 
the jobs and quality of life enjoyed by future generations. This is why 
the UAW supports a broad policy agenda to address climate change, 
including emissions regulations, investment in sustainable 
infrastructure and the green economy, and international cooperation.
    The UAW, based on experience, rejects the idea that fuel efficiency 
and environmental regulations lead to closed plants and lost jobs. 
Protecting the environment is not inherently bad for the economy and 
solutions exist all around us. Fuel-efficient vehicles, clean energy, 
clean manufacturing, renewable energy and other advanced technologies 
are an opportunity to create new middle-class jobs with good pay, good 
benefits and economic security. Our economy is changing in real time 
and UAW members already design and build advanced cars and trucks, 
advanced engines and transmissions, lighter materials and other 
advanced green products.
    Consumers and governments worldwide expect greener products. Europe 
and China are developing advanced green technologies at a brisk pace. 
Products for a green economy should be made here but we fear they will 
not be if we remain on the current course in Washington, D.C. The 
United States must be a producer and exporter of advanced technology 
products, not jobs. We have an obligation to safeguard the future of 
our jobs, families, communities and our planet.
    2. Please discuss technologies and components that are being 
manufactured in the United States today by UAW members to reduce 
emissions and improve efficiency.
    The UAW represents 225,000 workers in auto vehicle and auto parts 
manufacturing, many of whom are working to produce vehicles and 
components with improved efficiency and reduced emissions. Whether it 
is electric vehicles (EVs), autonomous vehicles (AVs), plug-in hybrids 
(PHEVs), more efficient internal combustion vehicles, or other key 
vehicles components optimized for efficiency, UAW members are already 
building the vehicles of the future. To ensure that the UAW members 
build the next generation of advanced technology vehicles, we need 
policies that promote investment in domestic production of the latest 
technologies.
    Electric Vehicles & Plug-In Hybrids: UAW members are playing a role 
in the development of PHEVs, EVs, and AVs. Currently, the UAW 
represents around 1,600 workers at General Motors' Orion, MI assembly 
plant where the Chevrolet Bolt electric vehicle and Cruise autonomous 
test vehicle are produced. Automakers have announced future investments 
that will bring additional EVs and PHEVs to UAW-represented assembly 
plants. These include:
           GM plans to build a second EV at its plant in Orion 
        MI.\1\
           Ford will build the 2020 Ford Escape PHEV in 
        Louisville, KY,\2\ is upgrading its Chicago, IL assembly plant 
        to make the hybrid Ford Explorer and PHEV Lincoln Aviator,\3\ 
        and plans to build a new EV in Flat Rock, MI.\4\
           Fiat Chrysler plans to build a Jeep Wrangler PHEV in 
        Toledo, OH \5\ and is preparing three assembly plants in 
        Michigan for future plug-in hybrid production of Jeep 
        vehicles.\6\
    The UAW advocates for automaker investment in the domestic 
production of advanced technology vehicles in order to create quality 
jobs. But other decisions by automakers raise concerns about their 
commitment to US production of advanced technology vehicles.
           GM ended production of the Chevrolet Volt plug-in 
        hybrid in February 2019. The Chevrolet Volt was made at GM's 
        Detroit-Hamtramck plant, which GM has declared ``unallocated'' 
        for future products.\7\
           Ford ended production in Wayne, MI of the C-Max 
        Energi plug-in hybrid and the Ford Focus Electric EV in 
        2018.\8\
           Ford is beginning production of its first EV SUV in 
        Cuautitlan, Mexico starting in 2020.\9\
    More Efficient Traditional Vehicles: Electric vehicles and plug-in 
hybrids are just one part of a broader trend of improved fuel economy 
and reduced emissions in the auto industry. In the past decade, real 
world fuel economy has improved across all vehicle segments, from 
sedans to pickups.\10\ UAW members not only assemble many of those 
vehicles, they also produce key components that improve vehicle 
efficiency.
    For example, the UAW represents roughly 25,000 workers in 
automotive engine and transmission assembly in Indiana, Michigan, New 
York, Ohio, and Tennessee. Many of these workers are producing the 
latest technologies in internal combustion engines that are driving 
incremental improvements in fuel economy and emissions reduction 
fleetwide, such as engines with turbocharging, direct fuel injection, 
and cylinder de-activation or transmissions with 9 or 10 speeds. UAW 
members build cutting edge technologies in the heavy duty as well light 
duty motor vehicle sector.
    Continued investment in US manufacturing to producer cleaner, more 
efficient products show that future technology trends in the auto 
industry can be a win-win for workers and the environment. This win-win 
is only possible if manufacturers commit to investing in production in 
the U.S., government trade and industrial policies promotes U.S. 
production of advanced technology, and workers have a voice in the 
workplace to ensure the resulting jobs provide quality pay, benefits, 
and safety. Congress needs to make sure our laws provide sufficient 
incentives for domestic investments and remove perverse incentives that 
favor foreign investments over domestic.
    3. What are other countries doing to secure their piece of the 
market in the global clean vehicle economy? What can we learn from 
them?
    The auto industry is facing a new shift in technology with the 
proliferation of electric vehicles (EVs). This shift is an opportunity 
to re-invest in U.S. manufacturing. But this opportunity will be lost 
if EVs or their components are imported or made by low-road suppliers 
who underpay workers. In order to preserve American jobs and work 
standards, what is needed is a proactive industrial policy that creates 
high-quality manufacturing jobs making EVs and their components.
    Other countries are ahead of the US on creating an EV supply chain 
by proactively promoting domestic production. China is promoting 
domestic production of EVs and EV components by favoring domestic firms 
and subsidizing its domestic EV market. Because of these policies, 
automakers are orienting their EV strategies toward China. And European 
countries have recognized that EVs could lead to key vehicle components 
being imported and are taking actions to promote a domestic supply 
chain.
    Will the U.S. Lose Out on the EV Supply Chain?
    No one knows for sure. Unfortunately, this is a distinct 
possibility. Automakers, governments, and other key stakeholders have 
shown a commitment to develop and produce EVs. Where those vehicles and 
components will be made remains an open question.
    A January 2019 Reuters analysis of automaker investment 
announcements found over $300 billion in pledged investment for vehicle 
electrification, with $39 billion announced by U.S.-based automakers, 
$139.5 billion from Germany-based automakers and $57 billion from 
China-based automakers. However, the report also found a large portion 
of those investments from U.S. and German automakers are destined for 
China to address the country's tightening EV regulations.\11\
    Besides competition over where EVs will be assembled, there is a 
global competition for control of the new EV value-chain. The prime 
example of this race is lithium-ion batteries. Lithium-ion batteries 
are the most valuable component in EVs. This has sparked a race to 
develop the production capacity to meet growing battery demand and it 
is this race that will determine the geography of much of the EV value 
chain.
    Based on developments so far, the U.S. is falling behind Asian and 
European countries in lithium-ion battery capacity. It is projected 
that by 2023, 62% of battery manufacturing capacity will be in China 
and another 14% will be in Europe. North America will only have 12% of 
global battery production capacity.\12\
    China & Europe Are Taking Action: How are other countries getting 
ahead on electric vehicle technology? It is through industrial policy 
that uses targeted, proactive policies to increase demand for EVs and 
promotes domestic production of vehicles and components.
    For example, China has set ambitious targets for the new energy 
auto industry. This includes a sales target of 1 million EVs and plug-
in hybrids in 2020 and 3 million in 2025. It calls for 80% global 
market share in EV batteries and electric motors by 2020, and to have 
two Chinese OEMs enter the global top 10 in sales by 2025.\13\
    China has increased demand from consumers by offering a variety of 
purchase subsidies, tax breaks, and in-kind benefits to EV buyers. 
China has also stimulated demand through government procurement 
policies that mandate a portion of vehicle purchases are EVs or 
hybrids. As a result, China is leveraging its position as the world's 
largest automotive market and leading the world's largest automakers to 
orient their EV strategies toward China.
    China has structured these incentives to support domestic 
production. For example, consumer subsidies are only applied to cars 
with government-approved batteries that favor Chinese-made batteries 
and government procurement is directed toward domestically produced 
vehicles.\14\
    It is not just China that sees the importance of the new EV value 
chain. The European Union and its members countries have recognized 
that the lack of a domestic battery manufacturing base will undermine 
the region's competitiveness,\15\ especially if the growth of EVs leads 
to key vehicle components being imported from elsewhere.
    In a speech to the EU Members of Parliament, Vice President of the 
European Commission Maros Sefcovic put the issue in stark terms. ``The 
European battery market is expected to create four to five million new 
jobs. These can be jobs here in Europe or somewhere else''.\16\
    To address these concerns, steps are being taken by European 
governments to develop a European-based EV supply chain. For example:
           In October 2017, the European Commission announced 
        the creation of the European Battery Alliance. The goal of the 
        alliance is to develop a ``complete value-chain`` for 
        manufacturing batteries in Europe \17\ by coordinating with 
        governments and stakeholders throughout the battery supply 
        chain, including major European companies in the chemical, 
        automotive, and engineering sectors.\18\
           In April 2019, the French and German governments 
        announced plans for a state-subsidized battery cell consortium 
        between automaker PSA, its German subsidiary Opel, and French 
        battery maker Saft that will result in large battery factories 
        in each country.\19\
    Policy Lessons to Lead on EVs: What is needed is a proactive 
industrial policy that promotes the production of EVs and their 
components in the U.S. under higher road conditions that benefit 
American workers and the communities that rely on manufacturing jobs.
           Infrastructure: Vehicle electrification requires 
        building a charging infrastructure for drivers and upgrading 
        our energy infrastructure to meet electricity demand while 
        ensuring electricity production is as green as the EVs 
        themselves. This is an opportunity to create quality jobs to 
        build, install, and maintain EV infrastructure.
           Training: Workers will need new skills and displaced 
        workers will need re-training programs. Strong industrial 
        policy should include every effort to re-train and place 
        workers in quality jobs, provide strong economic support for 
        workers during transition periods, and create robust government 
        jobs programs to guarantee quality jobs for all those seeking 
        work. We must expand training and apprenticeship programs that 
        anticipate the types of future skills needed to produce, 
        install, operate, and service products and equipment that 
        utilize the new technologies which will be transforming our 
        workplaces.
           Trade and Tax Policy: The economic potential of EVs 
        will be lost if their components are imported. Advanced vehicle 
        technology should be treated as a strategic sector to be 
        protected and built in the U.S. Trade and tax policies should 
        be aimed at ensuring EVs are manufactured in the U.S.
           Tax policy should incentive domestic manufacturing. 
        Sadly, the opposite is often true today. Tax policies must hold 
        companies accountable for eliminating jobs domestically by 
        moving their operations offshore.
           Environmental Policy: Strong environmental standards 
        can be structured as a win-win for the environment, workers, 
        and the economy. Environmental policy should be used to address 
        climate change while also promoting investment in future 
        technologies that create quality jobs in the process.
           Manufacturing Incentives: Government incentives can 
        promote production of EVs and EV components in the U.S. Such 
        incentives should be used in a targeted way to promote a 
        domestic EV supply chain and enforce high-road manufacturing 
        practices.
           Government Procurement: Government EV fleet 
        purchases, from cars to public transportation, can be a tool to 
        spur demand and create cleaner transportation. Such purchases 
        should be used to promote high-road jobs by considering where 
        vehicles are assembled, their level of domestic content, and 
        the labor conditions under which they were produced.
           Consumer Incentives: Consumer incentives are a tool 
        to create a robust domestic EV market. This will encourage 
        companies to orient their EV strategies toward the U.S. market. 
        Consumer incentives should also be used to promote high-road 
        domestic EV production. Incentives should be based on where the 
        vehicle and its contents were produced and under what labor 
        conditions.
    4. In your testimony, you referenced new technologies such as 
autonomous vehicles. What policies should Congress adopt to ensure that 
new technology trends in the transportation sector are good for the 
environment and for workers?
    While autonomous vehicles are in the early stages of development 
and years away from widespread deployment, it is important to establish 
standards today that ensure AV producers and operators are accountable 
to key stakeholders tomorrow. Advocates for AVs point to many potential 
benefits in safety, sustainability, and mobility, but those goals will 
only be fully reached if we have policies that take into account the 
impact AVs will have on jobs, communities, and the environment.
    There is little dispute AVs will be disruptive. One study predicts 
that autonomous passenger vehicles and heavy-duty trucks could combine 
to eliminate 1.3 to 2.3 million workers' jobs by 2050, with most job 
losses occurring in the latter years.\20\ Many more jobs will be 
radically changed. Congress should promulgate regulation and policies 
that provide a comprehensive plan for addressing job displacement for 
workers in the transportation sectors. Unlike inadequate retraining 
programs meant to address job losses due to unfair trade policies, 
workers and communities should be held harmless from rapid 
technological change. AV regulations should ensure that the pace of AV 
deployment is driven by safety, security, sustainability, and efficacy 
and not used as a strategy to cut costs and destroy quality jobs. It is 
incumbent on Congress to ensure this transition is just. The UAW 
believes Congress should enact legislation that not only ensures 
American firms are global leaders in advanced transportation 
technology, but that affords American workers a just transition.
    Developing Domestic Supply Chains: The mass production of AVs will 
create a valuable and strategic new supply chain in AV-specific 
components related to electronics and electrical architecture, 
semiconductors, graphic processing units, computer processing units, 
lidar, radar, cameras, and other sensors. As with EV-specific 
components, these AV-specific components represent an economic 
opportunity to reinvest in US manufacturing to produce the most 
advanced vehicle technology.
    This opportunity will be lost if these key AV components are simply 
imported. Too often, corporations develop new products in the U.S., but 
outsource manufacturing to low-cost countries with weak labor and 
environmental regulations--limiting the environmental benefits of 
electric-autonomous vehicles. Based on historical experience, once 
these supply chains are established outside of the U.S., they will be 
difficult to re-shore. Federal policy must strongly incentivize 
investment in and production of advanced technology components and 
vehicles in the U.S. The UAW recommends:
           Research and Development Grants Tied to U.S. 
        Production: Federal support for AV research and development 
        should include incentives or mandates that commercialized 
        production is done in the U.S.
           Federal Subsidies for Manufacturing of Cutting-Edge 
        Products: Federal subsidies for manufacturing of AVs and AV 
        components can be an important tool to incentive domestic 
        production and should be targeted in a way that develop a full 
        supply chain of domestically produced AV-specific components.
           Support Trade Policy That Protects Strategic 
        Cutting-Edge Components: Trade policy should include safeguards 
        for domestic production of strategic parts to ensure workers 
        benefit from the new technology and the technology is made with 
        the highest levels of safety and security.
    Developing an Infrastructure for the 21st Century: New 
infrastructure will be required to regulate how AVs interact with their 
surroundings, including re-investment in traditional infrastructure and 
the development of new `smart' infrastructure. Building new 
infrastructure is an opportunity to create quality jobs by mandating 
high-road labor standards and incentivizing the use of domestically 
manufactured equipment. The design of AV infrastructure must fairly 
address the concerns of key stakeholders and prioritize safety, quality 
job creation, environmental sustainability, and the well-being of local 
communities where the vehicles are being deployed.
    A recent study found that on-demand transportation, which in the 
future may include autonomous vehicles, has significantly increased 
vehicle congestion.\21\ Increased congestion could offset some of the 
freedom of movement and reduced environmental impact that electric AVs 
promise. A well-designed public transit system could counteract these 
inherent problems. Going forward, public transit should be the anchor 
that allows for proper and limited use of AVs. Requiring integration 
with a metro areas mass transit system would allow for public input on 
a system's priorities, its environmental impact, and job quality.
    Developing a Just Transition for Workers: Federal AV regulations or 
policies must include a comprehensive plan for addressing job 
displacement for workers in the transportation sectors, including 
negotiating job protections and retraining programs with labor 
organizations and funding a robust safety net to support displaced 
workers and provide them with new jobs. The burden of technological 
change should not be carried by working people.
    The government should intervene to help identify, and train workers 
for, the high value-added jobs associated with autonomous vehicles. AVs 
will also create new types of transportation jobs. AV testing and fleet 
operation will require safety drivers, software operators, remote 
drivers, dispatchers, mechanics, cleaners, call center operators or 
customer service workers. Any AV operator that receives public support 
or permission to use public infrastructure should have to meet job 
quality standards. It is vital that the AV industry is not modelled on 
the ``gig-economy'', with low-wages, contract labor, lack of benefits, 
and job insecurity. If these jobs are going to offset some of the job 
displacement of AVs, they must be good paying jobs that come with 
benefits, safety, and a voice in the workplace.
    5. Congress has provided incentives for consumers to expedite 
deployment of electric vehicles. When crafting these incentives, how 
can Congress ensure workers benefit from this expanding sector?
    Incentive programs to promote EV adoption must strongly encourage 
domestic production and high-quality jobs for workers to stabilize the 
middle class. Programs must be designed to promote manufacturing motor 
vehicles, batteries and components on U.S. soil and to hold 
manufacturers accountable for working conditions. For far too long, 
companies have received extensive support from taxpayers only to turn 
around and shirk their responsibilities to U.S. workers and our 
economy.
    Publicly funded incentives are an essential component to 
stimulating a robust EV market. There continue to be barriers to 
widespread adoption of EVs. One major reason is higher vehicle prices, 
driven by the high cost of EV batteries. Although analysts project that 
electric vehicles will likely become price competitive with traditional 
vehicles in about a decade,\22\ EV sales would need to accelerate on a 
shorter timeline in order to reduce emissions and combat the climate 
crisis.
Incentives with labor standards should be required for all EV consumer 
        incentives programs, government procurement policies, and 
        manufacturing subsidies.
    Consumer incentives for vehicle purchases or residential charging 
installations are a policy tool that can increase the adoption of 
cleaner vehicles and nurture this new market. Consumer incentives 
should also be used to promote quality domestic jobs manufacturing EVs 
by considering where the vehicle was assembled, the level of the 
vehicle's domestic content, and the conditions under which the vehicle 
and components were produced, including wages, benefits, health and 
safety, and freedom of association.
    In addition to labor standards, it is critical that EV incentives 
are offered across all types of passenger vehicles. Nearly all EVs and 
PHEVs available for sale in the last few years have been sedans, with 
few options for larger vehicles. Yet, consumers have moved away from 
sedans in favor of crossovers, SUVs, and pickups. Nationwide, car sales 
declined by 30% between 2013 and 2018, while all other segments 
grew.\23\
    Reaching mass-adoption of EVs and PHEVs will require electrifying 
larger vehicle segments. Manufacturers are expanding beyond EV sedans 
and are starting to offer models that will include pickups, crossovers 
and SUVs. Consumer incentives for PHEVs and EVs should be structured to 
encourage automakers to offer electrified options in all segments.
    For electrification to reach the broadest swath of consumers and 
vehicle segments, incentives should always include PHEVs. PHEVs are an 
important option for consumers who live in regions with limited 
charging infrastructure because they can combine gas and electric 
mileage for longer range. PHEV are often a more affordable option as 
well. The 2018 sales weighted average MSRP for PHEVs was more than 
$10,000 cheaper than for EVs.\24\ It is also likely that the first 
electrified versions of many larger vehicles will be PHEVs, with full 
EVs coming to market later.
    Procurement Policy: Government EV fleet purchases, whether it is 
cars or public transportation, can be a tool for spurring demand and 
creating cleaner transportation. And EVs are well-suited for fleet 
purchases due to their operating cost advantages.\25\
    These purchases can also be a tool to push EV production toward a 
high-road path, by conditioning such purchases upon standards of social 
responsibility. Such purchase policies would incentivize manufacturers 
to establish a production footprint in the U.S. and ensure that 
production has the positive economic impacts that come with quality 
manufacturing jobs.
    Manufacturing Incentives: The electrification of the auto industry 
is still in its early stages and auto manufacturers are responding to a 
combination of regulatory requirements and consumer demand. The next 
few years will see the introduction of many new EV models, with nearly 
all major automakers setting ambitious goals for EVs and plans to spend 
over $300 billion globally to transition to electric vehicles.\26\
    While some manufacturers have made plans to invest in domestic EV 
production, without additional policy guidance and market growth, much 
of the industry could move overseas, compromising the quality of jobs 
and vehicles.
    Policymakers should consider programs to stimulate investment in 
domestic EV assembly, including retooling existing plants, building new 
plants for EV assembly, as well as building batteries or other 
components. Such programs should ensure high quality jobs, and 
opportunities for workers to transition from building conventional 
combustion engines or parts to electric vehicles without loss of wages 
and benefits.
                               references
    \1\ https://media.gm.com/media/us/en/gm/home.detail.html/content/
Pages/news/us/en/2019/mar/0322-orion.html
    \2\ https://www.bizjournals.com/louisville/news/2019/04/02/ford-
unveils-new-louisville-built-
escape-photos.html
    \3\ https://www.freep.com/story/news/local/michigan/detroit/2019/
07/22/ford-upgrading-chicago-assembly-plant-adding-450-jobs/1801125001/
    \4\ https://media.ford.com/content/fordmedia/fna/us/en/news/2019/
03/20/ford-adds-2nd-north-american-site-to-build-battery-electrics.html
    \5\ https://www.toledoblade.com/business/automotive/2018/12/01/
jeep-wrangler-hybrid-coming-quietly-to-a-woods-near-you/stories/
20181130116
    \6\ https://media.fcanorthamerica.com/newsrelease.do?id=20661∣=
    \7\ https://www.cbsnews.com/news/chevy-volt-discontinued-
chevrolets-last-volt-rolls-off-the-
assembly-line/
    \8\ https://www.autonews.com/article/20180508/BLOG06/180509813/a-
final-goodbye-to-the-ford-focus-c-max
    \9\ https://www.thedrive.com/news/27066/ford-will-split-electric-
vehicle-manufacturing-between-mexico-and-united-states
    \10\ https://nepis.epa.gov/Exe/ZyPDF.cgi/
P100W5C2.PDF?Dockey=P100W5C2.PDF, p. 15
    \11\ https://graphics.reuters.com/AUTOS-INVESTMENT-ELECTRIC/
010081ZB3HD/index.html
    \12\ https://www.visualcapitalist.com/battery-megafactory-forecast-
1-twh-capacity-2028/
    \13\ http://english.gov.cn/policies/infographics/2015/06/02/
content_281475119391820.htm
    \14\ http://www.nbr.org/downloads/pdfs/eta/heller_brief_092717.pdf
    \15\ http://europa.eu/rapid/press-release_STATEMENT-17-3861_en.htm
    \16\ https://ec.europa.eu/commission/commissioners/2014-2019/
sefcovic/announcements/speech-launch-friends-eu-battery-alliance-
european-parliament_en
    \17\ https://ec.europa.eu/transparency/regdoc/rep/1/2017/EN/COM-
2017-675-F1-EN-MAIN-PART-1.PDF, page 10
    \18\ https://www.euractiv.com/section/electric-cars/news/airbus-
style-eu-battery-alliance-splits-
before-take-off/
    \19\ https://www.reuters.com/article/us-france-germany-industry/
france-and-germany-commit-to-european-electric-battery-industry-
idUSKCN1S80SF
    \20\ https://research.upjohn.org/up_technicalreports/36/
    \21\ https://advances.sciencemag.org/content/5/5/eaau2670
    \22\ Bloomberg New Energy Finance, ``Electric Vehicle Outlook 
2018'': https://about.bnef.com/electric-vehicle-outlook/
    \23\ WardsAuto, Sales Data
    \24\ Argonne National Laboratory, March 2019, ``Assessment of 
Light-Duty Plug-In Electric Vehicles in the United States, 2010-2018'': 
https://publications.anl.gov/anlpubs/2019/03/151081.pdf, page 16
    \25\ https://www2.deloitte.com/content/dam/insights/us/articles/
3851_FoM-Power-and-utilities/DeloitteInsights_FoM-P&U.pdf, page 6
    \26\ https://graphics.reuters.com/AUTOS-INVESTMENT-ELECTRIC/
010081ZB3HD/index.html

                        Questions for the Record

                               Tarak Shah

    Former Chief of Staff, Under Secretary for Secretary and Energy

                       U.S. Department of Energy

                       the honorable kathy castor
    1. Could you please describe overall funding levels for federal 
energy innovation efforts? In the context of the climate crisis, are 
these levels adequate and are there any areas that deserve special 
emphasis?
    The last comprehensive official survey of U.S. Government clean 
energy R&D funding levels was completed in 2016. At the time, the 
Office of Management and Budget found that Congress had enacted $6.4B 
in clean energy R&D funding in FY 2016 across the government, $4.8B (or 
approximately 75%) of which was appropriated to the U.S. Department of 
Energy (DOE).
    Since then, Congress has increased funding to DOE's science and 
clean energy programs by about 20%. Congress deserves credit for 
increasing DOE funding even as the current administration has proposed 
gutting federal energy innovation programs.
    Even so, the rate of increase in energy innovation funding is not 
fast enough. Along with nearly two-dozen other countries, the United 
States committed to doubling its national clean energy innovation 
programs between 2016 and 2021. Other countries are making good on 
their commitments. If the United States does not, the jobs and economic 
opportunities associated with these types of catalytic government 
investments will flow to the countries that are stepping up to the 
plate.
    In the United States, we are particularly underinvested in energy 
innovation in the transportation, buildings, and industrial sectors, in 
comparison to their shares of greenhouse gas (GHG) emissions. Congress 
should more than double clean energy innovation efforts in these areas.
    2. In your testimony, you mentioned that there are programs at the 
U.S. Department of Energy (DOE) that focus on industrial efficiency 
improvements. Should the mandate for these programs be updated in the 
context of the climate crisis, and if so, how? Please feel free to 
reference specific DOE programs.
    The U.S. industrial sector is the source of about 22% of our GHG 
emissions. DOE's Advanced Manufacturing Office (AMO) works to help 
reduce these emissions by improving energy efficiency in our nation's 
factories. While there is much more to do to improve the energy 
efficiency of our industrial processes, there are thermodynamic limits 
on how much efficiency can be achieved. In other words, the industrial 
sector will always generate some greenhouse gas emissions even if 
energy efficiency is implemented fully. Therefore, to get to net zero 
by 2050 (as is required to prevent the worst impacts of climate 
change), industry must capture those remaining emissions.
    Given the research challenges and large capital requirements of 
innovation in this area, the federal government needs to lead the way. 
Carbon capture, utilization, and sequestration (CCUS) technologies, 
electrification of process heat, and substitution of low-carbon fuels 
for fossil fuels hold promise for the industrial sector but need more 
research to reduce costs and commercialize.
    The current legislative authorization for DOE, last updated in 
2005, does not mention climate change (Energy Policy Act of 2005, 
Section 902). In addition, the authorized goals for AMO (Energy Policy 
Act of 2005, Section 911) are exclusively focused on industrial energy 
efficiency. So much has changed in our energy sector since 2005. 
Congress should comprehensively update DOE's statutory goals to include 
climate considerations, both at the agency level, and to authorize AMO 
to develop a broader set of industrial decarbonization solutions, 
including industrial CCUS technologies. H.R. 3978, the Clean Industrial 
Technology Act of 2019 would promote this goal.
    In addition, DOE should elevate the level and widen the focus of 
its buildings and industrial RD&D by raising the level of the office 
from the current Deputy Assistant Secretary for Energy Efficiency to a 
new Assistant Secretary for Buildings and Manufacturing.
    3. In your testimony, you mentioned the potential for offshore wind 
development in the United States. What policies should Congress adopt 
to scale up deployment of this vast, clean resource?
    DOE estimates that more than 2,000 GW, or two times the combined 
generating capacity of all U.S. electric power plants of offshore wind 
resources exist in the state and federal waters of the United States 
and the Great Lakes. While not all of this will be realistically 
developed, to date, we have 30 MW of operating offshore wind in the 
U.S. That equals .0015% of our potential capacity.
    Furthermore, these offshore wind resources are near coastal 
population centers, which need new clean energy resources, but face 
onshore land constraints. In addition to funding additional research 
into offshore wind technologies, Congress should extend the federal 
Investment Tax Credit for offshore wind. Without action, the credit is 
set to phase out this year, cutting off investments in offshore wind, 
just as the costs for this technology is beginning to support 
widespread deployment. In addition to extending the tax credit for 
offshore wind, Congress should consider mechanisms to facilitate 
investments in transmission infrastructure to bring the robust offshore 
wind energy to load centers.
    4. In your testimony, you mentioned that DOE appliance standards 
have saved consumers almost $1 trillion dollars. Could you please 
describe additional ways that new technologies can help consumers save 
money? What are some examples?
    DOE's appliance standards program sets minimum efficiency levels 
for 60 commercial and consumer products, such as refrigerators, 
lighting, washing machines, dryers, and heating and cooling systems. 
Working with industry, this program brings together manufacturers, 
consumer advocates, environmental advocates and states to continually 
raise the game on the efficiency of appliances in our homes and 
businesses.
    The standards program has driven remarkable efficiency gains in 
household appliances and equipment. For example, today, the typical new 
refrigerator uses one-quarter the energy than in 1973--despite offering 
20% more storage capacity and being available at half the retail cost. 
Since 1990, new washing machines use 70% less energy, air conditioners 
use 50% less energy, and dishwashers use 40% less energy.
    Overall, these standards already help save consumers $1 trillion 
over the past 30 years, and will save them another $1 trillion over the 
next decade. Put another way, the program helps the average family 
nearly $500 per year through lower energy bills. This also has the 
effect of reducing GHG emissions.
    Congress requires DOE to update these standards every six years, 
but the current administration has slowed this process, and in some 
cases is attempting to roll back existing standards. Over time, this 
will mean that Americans will pay higher energy bills and emit more 
GHGs than they would if DOE was updating these standards.
    Doing so also weakens U.S. industry. American manufacturers are 
always at the technological cutting edge, and they are the best 
positioned globally to develop new products that meet energy efficiency 
standards. By rolling back these standards, the current administration 
is giving foreign competitors with inefficient technologies an 
advantage over domestic companies. DOE should instead be strengthening 
the standards, which would increase energy efficiency and save 
consumers even more money on energy costs.
    5. In your testimony, you mentioned how policies could be 
strengthened to ensure that projects that receive funding from DOE have 
domestic manufacturing plans. Could you expand upon what Congress 
should do to better safeguard domestic production of taxpayer-funded 
technologies?
    Under a provision of the Bayh-Dole Act, DOE's Energy Efficiency and 
Renewable Energy (EERE) and Advanced Research Projects Agency-Energy 
(ARPA-E) programs require award applicants to submit U.S. Manufacturing 
Plans. These plans state an awardee's commitment to manufacture 
technologies resulting from DOE awards in the United States.
    Congress should ask DOE to strengthen this requirement by applying 
it to all applied energy RDD&D programs (not just EERE and ARPA-E) and 
to develop recommendations for strengthening proposed manufacturing 
plans. Specifically, the current law gives the Federal government very 
few mechanisms to enforce the commitments that awardees make in their 
plans. At most, DOE could bar an entity that violated the terms of its 
U.S. Manufacturing Plan from competing for future awards.
    Stronger mechanisms could include clawback provisions for offshored 
intellectual property or financial compensation for U.S. taxpayer 
sponsored technology that is manufactured offshore. DOE is well suited 
to address the pros and cons of strengthening the requirements and 
enforceability of these plans.
    6. In your testimony, you mentioned that support from DOE programs, 
particularly in the Advanced Manufacturing Office, helped drive down 
the price of clean energy technologies. Could you please provide 
examples of how the Manufacturing USA Institutes have produced real 
results for the U.S. economy and clean energy in particular? How could 
Congress help these existing institutes meet the scale of the climate 
crisis?
    The Manufacturing USA Institutes are a national network of 
federally sponsored manufacturing institutes, each with their own 
technological concentration, but designed to accelerate U.S. 
manufacturing as a whole. DOE sponsors six of these institutes, 
focusing on topics like solid-state power electronics, advanced 
composites, and chemical manufacturing.
    The first of these institutes, Power America, is approaching its 
fifth year in operation. Based on manufacturing advances developed at 
Power America, a foundry in Texas is the first in the world to 
manufacture 6-inch Silicon Carbide (SiC) wafers. SiC semiconductors 
represent a revolutionary new design for computer chips. Computer chips 
are at the base of the supply chain for every clean energy technology--
so if we can build them here, we have an advantage when it comes to 
building all the things they are in as well--from solar technologies to 
electric vehicles (EVs) and beyond.
    Congress and DOE originally agreed to support these institutes for 
five years, at which time they would become self-sustaining. Other 
countries with similar technology-specific clean energy manufacturing 
institutes support their entities indefinitely. This is because 
experience shows that it takes more than five years to build 
enterprises on the scale of these institutes. Congress and DOE should 
work together to determine a new, competitive funding mechanism to 
support these institutes after their initial five years of funding 
ends. The advances they have made are substantial, and the investments 
U.S. taxpayers have made risk being stranded without additional federal 
support. In addition, because the model has been so successful, 
Congress should ask DOE to identify new potential topic areas that 
would be well suited for the institute model.
    7. What are other countries doing to secure their piece of the 
market in the global clean energy economy? What can we learn from them?
    Other countries have holistic, sector-centric models to address the 
climate crisis. For example, some countries like the U.K. have set 
overall carbon budgets by sector and then are applying a comprehensive 
range of solutions, including R&D, market and deployment incentives, 
workforce development, and regulation to achieve their goals.
    Yet other countries are examining future technologies on a case-by-
case basis and deciding if they want to lead the market. For example, a 
decade ago, China looked at solar PV manufacturing and decided to 
become the world leader. Because of their expertise in solar 
manufacturing, they are now a world leader in semi-conductor 
manufacturing, which has enabled them to become a world-leading 
computer manufacturer. And because future clean energy products like 
EVs are heavily digitized, they now have an advantage in that space.
    The United States should be looking at the future clean energy 
business in much the same way other countries are--based on both the 
moral imperative and the size of the economic opportunity. Upon 
examining technologies like next generation solar, offshore wind, EVs, 
carbon capture, advanced nuclear, renewable hydrogen, energy efficient 
appliances and others, we would recognize that we have historical 
strengths in each of these areas.
    With the right combination of catalytic tools from the federal 
government, we can lead the world on each of these technologies. But it 
takes a comprehensive array of federal programs, not ad hoc, one-time 
interventions by Congress and the federal agencies.
    8. Congress has provided incentives to wind and solar companies to 
expedite deployment of this zero-carbon source of electricity. When 
crafting these incentives, how can Congress ensure workers benefit from 
this expanding sector?
    For those wind and solar products that are imported into the U.S., 
Congress should ensure that trade agreements with the countries they 
are manufactured in include rigorous labor and environmental standards. 
In other words, American workers who build solar panels and wind 
turbine components should not be penalized for making a fair wage or 
building them without destroying the environment. A number of trade 
deals are in various stages of development with countries that send 
their solar and wind products to the U.S. at the moment, so this is a 
crucial time to ensure such protections are put in place.
                      the honorable ben ray lujan
    1. Given the magnitude of the industrial decarbonization challenge, 
I'd like to ask you, Mr. Shah, on how we can begin to address such a 
problem. Given that we need to reduce emissions from a wide range of 
manufacturing processes, such as steel, iron, aluminum, concrete, 
chemicals, and a whole host of other products that are essential for 
our economy, are there existing technologies that we can build and 
learn from and adapt to suit the needs of reducing emissions from 
manufacturing?
    This is an important question because the Environmental Protection 
Agency reports that 22% of U.S. emissions come from the industrial 
sector. When examining the range of solutions by sector, industry is 
generally thought of as the most difficult to decarbonize from a 
technological perspective. On the other hand, industrial emissions are 
well known, and relatively concentrated, which means that once we begin 
to apply solutions, they can make a big difference quickly.
    The solution set is two fold. One, there must be a financial 
imperative for industry to decarbonize. Right now, there is no a market 
signal that would either incentivize or disincentivize industry to 
pollute. Incentives could come in the form of a tax credit for reducing 
emissions, either through efficiency, electrification, low-carbon 
fuels, or carbon capture, utilization, and storage (CCUS). The 45Q tax 
credit is a start, but without clear guidance from IRS, remains 
difficult for companies to access. Even after guidance is promulgated, 
more incentives are required. Disincentives to pollute can also spur 
action. For example, implementing a price on carbon pollution would 
also stimulate quick action to reduce GHGs from industry.
    For these financial incentives to work, we also need new 
technological solutions for industrial energy efficiency and CCUS. For 
2019, Congress appropriated $320 million for DOE's Advanced 
Manufacturing Office, or less than 1% of DOE's overall appropriation. 
There is a huge array of energy innovation options for industry, but we 
are not examining them robustly because we have not made it a funding 
priority. More funding is needed. In addition, the authorized goals for 
AMO (Energy Policy Act of 2005, Section 911) are exclusively focused on 
industrial energy efficiency. As Congress considers updating DOE's 
statutory mandate, it should authorize AMO to perform research on 
industrial CCUS technologies.
    2. When we talk about innovation in the manufacturing sector, we 
are going to need to find new ways for the federal government to 
partner with the private sector, academia, and philanthropy. We have 
seen some agencies establish non-profit foundations to better support 
their missions. For example, the Foundation for the National Institute 
of Health has raised over $1 billion dollars and supported over 550 
projects. I have introduced the bipartisan, bicameral IMPACT for Energy 
Act, which would create a foundation for the Department of Energy. 
Should we consider these models to accelerate the development and 
deployment of clean energy technologies at the Department of Energy? 
How could a non-profit alongside the Department of Energy assist the 
Department in its mission and better leverage federal resources?
    99% of U.S. energy infrastructure is in the hands of the private 
sector. That means that the federal government cannot transform our 
energy mix without active participation from the private sector. That 
is why accelerating the commercialization of research and technology 
through increased access to private sector funding and new models for 
public-private partnership is critical.
    As it has done with other federal agencies, a DOE Foundation could 
be an important tool to address early-stage gaps in the energy 
innovation cycle, which are hampering DOE's ability to spur the 
adoption of transformative technology in the market. Congress 
rightfully included a study by the National Association of Public 
Administration in the FY2020 appropriations to look at this question, 
because there is a lot to learn about what this opportunity could 
deliver.
    In general, new energy technologies have a particularly difficult 
time getting to the market because they require a significant amount of 
capital and very long commercialization timelines. They also are 
deployed into an incumbent dominated market with large barriers to 
entry. These barriers could potentially be overcome through unique 
partnership models created by a foundation where communication and 
collaboration between the private sector and the DOE can be 
facilitated. These models have already been demonstrated by the 
Foundation for the National Institutes for Health and the CDC 
Foundation.
    Over the last several years DOE has experimented with hubs, 
consortia, Energy Frontier Research Centers, and institutes. These new 
research models are important funding experiments. The DOE Foundation 
could serve as another model--one built off of an already proven 
experiment--and I encourage DOE and Congress to further consider the 
idea.
                        the honorable mike levin
    1. Mr. Shah, in your testimony, you described the California ``Buy 
Clean'' procurement policy. How does a ``Buy Clean'' policy incentivize 
U.S. manufacturing?
    The State of California recently instituted a policy that requires 
the state to take the emissions related to producing steel, glass, and 
insulation from different manufacturers into account. For example, all 
things being equal, if one steel company produced lower emissions steel 
than another, the State would give that company preferential treatment 
in purchasing.
    The federal government is a huge purchaser of finished goods and 
construction materials. This, for example, includes cement and steel 
for federal highways, glass and concrete for housing projects, and 
vehicles for the federal fleet. If the federal government instituted a 
similar set of `buy clean' provisions, it would incentivize competition 
among producers to reduce the amount of GHGs released when 
manufacturing their products.
    2. If Congress were to adopt a Federal ``Buy Clean'' policy, what 
essential elements would need to be part of the policy?
    ``Buy clean'' policies must apply equally to all products, 
regardless of whether they are produced inside or outside of the U.S. 
Without such a provision, manufacturers could be incentivized to 
produce highly polluting products outside of the U.S. for import, 
harming domestic manufacturing.
    The monitoring and verification of companies GHG certifications are 
also important. Many proposed or enacted `buy clean' policies around 
the world rely on established eco-labels or other certification 
programs. However, not all certifications are created equal, so strong 
rules need to be put in place early to make sure companies are 
operating on a level playing field.
    In addition, acquisition officials should be able to examine the 
overall life-cycle costs of a product, to include weighing the long-
term environmental benefits of a clean product, as opposed to simply 
awarding a contract to the lowest bidder.
    Finally, federal agencies should be able to continuously raise the 
bar for purchased products, as lower GHG options appear on the market, 
without seeking additional authorization from Congress.

                        Questions for the Record

                             Edward Stones

         Global Business Director for Energy and Climate Change

                                  Dow

                       the honorable kathy castor
     1. In your testimony, you reference the fact that the Dow Chemical 
Company is one of the largest users of renewable energy in the 
chemicals industry. What Federal policies could facilitate greater use 
of renewable energy by companies like Dow?
     Technologies such as energy storage and demand-response need 
support to reach the point of economies of scale. Both of these 
technologies should form part of a broad, cost-competitive environment 
for large companies such as Dow. Both are essential to grid stability 
in the long term, and will be needed for further gains in renewables 
penetration.
     Over the past years the renewable energy markets in the United 
States grew thanks in part to the federal support received through the 
Renewable Electricity Production Tax Credit (PTC) and the Business 
Energy Investment Tax Credit (ITC). Onshore wind and solar energy 
reached technologies of scale, making them cost-competitive in 
comparison to traditional means of creating power, thus expanding their 
accessibility to large users such as Dow. Today, both onshore wind and 
solar technology are competitive beyond the federal support received 
through the PTC and the ITC, so that continued federal credits are 
unnecessary.
     Information from the Renewable Energy Buyers Alliance, based on 
publicly announced contracted capacity of corporate Power Purchase 
Agreements, Green Power Purchases, Green Tariffs, and Outright Project, 
shows that in 2014 there were eight transactions with a volume equal to 
1.2 GW of capacity; by year-end 2018 there were seventy-five 
transactions with a total volume of 6.36 GW of capacity. Since 2014 
companies have contracted almost 20 GW of renewable energy capacity.
     Until there is wide spread adoption of energy storage options, 
which we foresee post 2030 at the earliest, gas fired energy generation 
will be required to offset renewable energy intermittency. 
Additionally, companies like Dow require process heat in significant 
amounts, with high temperatures and pressures. Few options other than 
nuclear exist for low carbon alternatives or renewables. Carbon Capture 
and Storage (CCS) and Carbon Capture, Utilization, and Storage (CCUS) 
are critical technologies and policy solutions. State and federal 
governments have a role to play in defining and enabling the 
infrastructure required for collecting and moving captured 
CO2. Next generation nuclear facilities are also potentially 
a source of zero carbon steam and power, as well as grid reliability.

                        Questions for the Record

                               Zoe Lipman

         Director, Vehicles and Advanced Transportation Program

                           BlueGreen Alliance

                       the honorable kathy castor
    1. What types of Federal policies should Congress enact to 
facilitate greater manufacturing of clean vehicle and clean energy 
technologies in the United States?
    An effective advanced and electric vehicle manufacturing agenda 
would couple strong globally leading standards and targets--most 
notably globally leading, strong, long-term fuel economy and vehicle 
greenhouse gas (GHG) standards--which give companies the certainty they 
need to invest in America, together with an aggressive push to 
manufacture vehicles and strategic components here in the United 
States.
    The key elements of that agenda include:
     A robust investment to spur advanced and electric vehicle 
(EV) and technology manufacturing and supply chain. This could include:
           New programs to support establishing, upgrading 
        or converting domestic clean vehicle and technology 
        manufacturing--such as an industrial bank, new bonds, grants, 
        or revolving loan programs.
     Expansion of the loan, grant, and tax programs we have 
today to help companies build, retool, or convert manufacturing plants 
in America. These include, for example, the Advanced Technology 
Vehicles Manufacturing (ATVM) loan program, 48C manufacturing tax 
credit, the Section 132 manufacturing conversion grant program, and 
others. Across these programs, to enhance the benefits for the economy, 
communities, and working people, we should:
           Incentivize responsible labor, community, and 
        supply chain practices and prioritize reinvestment in existing 
        or idle facilities and in deindustrialized, impacted, 
        underinvested communities;
           Prioritize economically strategic and emerging 
        technology and materials; and
           Encourage consortia of assemblers and 
        suppliers--and small- and medium-sized manufacturers--and aid 
        states and municipalities in investing in local priorities and 
        clusters.
     Act to responsibly produce critical minerals and materials 
and to launch new domestic recycling and reclamation projects--as 
discussed further below;
     Boost public investment in EV fleets and infrastructure 
and ensure that all public spending supports efforts to build critical 
components here and to secure and build good family-supporting jobs. 
This means:
           Improving, enhancing, and extending the 
        applicability of long-standing procurement standards and tools 
        such as Buy America/n and Davis Bacon prevailing wage--as well 
        as newer procurement approaches that enhance labor standards, 
        workers' rights, career pathways, equity and community 
        benefits--to ensure the use of domestically manufactured, 
        clean, and safe vehicles and infrastructure and to raise labor 
        standards throughout the supply chain; and
           Ensuring all public spending--such as tax 
        incentives, loan, grants, and bonds--also support--and do not 
        undermine--the manufacturing of domestic clean vehicle 
        technology in America, and promoting high labor standards, and 
        safe and healthy manufacturing throughout the supply chain.
     Make globally competitive levels of investment in research 
and development and ensure innovation is translated into domestic 
manufacturing and growth of supplier networks. This could include, for 
example:
           Establishing and implementing a national clean 
        energy and technology manufacturing strategy;
           At least doubling funding for research, 
        development, and deployment (RD&D) to levels commensurate with 
        competitor nations, and enhancing and emphasizing initiatives 
        focused on translating tax-payer funded R&D into full-scale 
        deployment and manufacturing;
           Establishing coordinated RD&D and manufacturing 
        initiatives aimed at capturing the full supply chains for 
        critical clean technologies--such as EV cells, batteries, and 
        related electronics--in the United States; and
           A focus on developing and deploying innovative 
        recycling and reclamation initiatives for key materials in the 
        advanced automotive supply chain.
     Enact fairer trade, labor, and corporate tax policies that 
can stem advanced tech offshoring and exploitative labor practices 
while driving a new generation of investment in domestic plants, 
workers, and training.
    2. How could Federal policies encourage greater reclamation and 
recycling of lithium-ion batteries from electric vehicles? Are there 
any promising state policy models that could be an example?
    Federal policy makers should make it a priority to explore ways to 
jump-start domestic efforts to responsibly reclaim and recycle key 
economically strategic materials--such as lithium--and to spur 
deployment of innovative circular economy processes and products.
    Past experience with conventional lead acid automotive batteries 
has shown that very high recycling rates are possible, but that moving 
the recycling processes to other countries both costs jobs in the 
United States, and can result in serious lead pollution and exposure 
problems in the host country if there are less stringent environmental 
standards and oversight.i
    With the new generation of lithium ion automotive batteries (and 
any subsequent battery chemistries), developing economically, socially 
and environmentally responsible recycling processes domestically will 
be critical and can also help ensure a more secure domestic supply of 
lithium. The same is true of many other comparatively rare minerals and 
materials that are part of advanced vehicles.
    There may also be important second life use of electric vehicle 
batteries, and any recycling processes likely should be coordinated 
with increasing use of similar batteries for residential, commercial, 
and utility energy storage.
    Federal policies that could spur the development of effective 
advanced battery recycling include, for example:
     Develop a national strategy to ensure we are creating the 
materials necessary for a clean and secure energy future here in the 
United States;
     Include investment to spur domestic projects to 
responsibly reclaim and recycle strategic minerals and materials--or to 
deploy circular economy technologies--as one of several key priorities 
for an industrial bank, or revolving loan fund, as discussed above; and
     Enhance funding to develop and deploy new recycling and 
reclamation approaches through existing grant, loan, tax, and other 
clean energy investment incentives.
    BlueGreen Alliance is just now beginning a review of state level 
policies that may be relevant--so we are unable to answer this portion 
of the question comprehensively--but initial assessment suggests that, 
a) encouraging states to address recycling proactively as the industry 
matures will be extremely valuable, and b) across materials recycling 
and reclamation, some federal role to sustain effective recycling 
programs across the inevitable wide swings in global commodity prices 
will be essential.
    3. In your testimony, you mentioned the potential for offshore wind 
development in the United States. What policies should Congress adopt 
to ensure that American workers benefit from deployment of this vast, 
clean resource?
    The potential for responsible offshore wind development in the 
United States is indeed substantial. According to the U.S. Department 
of Energy, if we utilized even one percent of the nation's technical 
potential offshore wind capacity, we could power nearly 6.5 million 
homes. We have the technology to harness wind power off the coasts of 
at least half of our states, and the industry is rapidly expanding both 
domestically and internationally.ii
    With this industry expansion comes tremendous potential to create 
and sustain quality, union jobs. Jobs in the offshore wind industry 
include designing the wind farm; constructing the onshore substations; 
laying cable interconnections; erecting the turbines; permitting; 
manufacturing rotor and nacelle controls, gearboxes, drive trains, 
generator and power electronics, steel towers, electrical wiring, 
advanced polymers, and coatings; construction; and operations and 
maintenance. Trades included in these various stages include operating 
engineers, pile drivers, millwrights, welders, electrical workers, 
utility workers, ironworkers, steelworkers, and machinists.
    Estimates put job creation potential off the Atlantic Coast alone 
at somewhere between 133,000 and 212,000 jobs per year in the United 
States.iii Additionally, the National Renewable Energy 
Laboratory (NREL) cites that the Atlantic coast states could create 
$200 billion in new economic opportunity, as well as over 43,000 high-
paying, permanent jobs, simply by developing 54 GW of their 1,283 GW 
offshore wind energy potential.iv
    In order to truly capture the full benefits and potential of these 
projects, it is critical that they are built by skilled workers who are 
paid family-sustaining wages, with project labor agreements in place, 
and with materials manufactured here in the United States.
    Offshore wind projects rely heavily on skilled labor and advanced 
manufacturing for construction, installation, maintenance, and 
operations. For example, the Block Island project--a comparatively 
small, demonstration project--created more than 300 jobs in the state 
alone v for local unionized craftsmen in ten different 
building trades locals, working for 30 unionized contractors and 
subcontractors.vi This was thanks--in large part--to the 
project labor agreement (PLA) in place for Block Island.
    PLAs are particularly critical in these projects because they bring 
coordinated, proactive planning to complex projects; provide crucial 
benefits to local communities in terms of skills training, employment 
opportunities, and future workforce development; and ensure that the 
most productive and skilled craft labor is available to work on a 
project. In addition, as wind farms and their components age, skilled 
workers in operations and maintenance will continue to prove necessary 
to the operation of the farms, so it is important to ensure that jobs 
throughout the life cycle of a wind farm are quality, family-sustaining 
jobs
    In addition to the construction phase of these projects, a critical 
component of the job creation potential for the offshore wind sector is 
the vast manufacturing supply chain that offers major opportunities for 
growth in a variety of sectors.
    As the industry grows, sourcing components domestically represents 
a significant opportunity to help revitalize American manufacturing. 
The Special Initiative for Offshore Wind's recent white paper predicts 
an almost $70 billion buildout of U.S. offshore wind supply chain by 
calculating growth in a number of sectors, which include wind turbines 
and towers; turbine and substation foundations; upland, export, and 
array cables; onshore and offshore substations; and marine support, 
insurance, and project management.vii
    Finally, the development of wind energy off our coasts can also 
provide important and much needed support to local communities in our 
coastal states. Community benefit agreements, designed in coordination 
with organized labor and local community organizations, help maximize a 
project's contribution to local communities, and ensure that local 
communities support the project in question.
    If we do this right, the American people can feel confident that 
emerging industries--such as offshore wind--will secure employment 
today and support the creation a new generation of family-supporting 
jobs across the nation.
    By supporting a wide variety of workforce development strategies 
targeted at this burgeoning sector, including union training and 
apprenticeship programs, legislation like the H.R. 3068 the Offshore 
Wind Jobs and Opportunity Act can also help ensure that workers have 
access to the skills training they need to take advantage of this 
important and emerging industry.
    4. What are other countries doing to secure their piece of the 
market in the global clean energy economy? What can we learn from them?
    Worldwide, countries are rushing to capture the economic benefits 
of the rapidly growing clean energy economy--and they are using the 
full range of policy tools to do so. If it is to compete, the United 
States needs a much more aggressive and coordinated strategy to capture 
the innovation, investment, jobs, and manufacturing gains from the 
clean economy.
    BlueGreen Alliance has not itself carried out any recent detailed 
research on global policy shifts, but a number of our partners and 
allies have focused on this question, and we would urge the committee 
to engage them further on this topic. Drawing on their expertise, 
however, and looking at the EV industry as an example, we make a few 
high-level comments about what is needed:
     Coordinated strategy and industrial policy: Both in China 
and the European Union, as well as elsewhere, countries are developing 
comprehensive long term strategies to deploy and produce EVs and the 
key technologies that go into them. These strategies often include 
energy and emissions targets and regulations, consumer and industry 
incentives, and economic development and manufacturing strategies 
working together. The United Auto Workers's recent report Taking the 
High Road: Strategies for a Fair EV Future provides a brief summary of 
EV policy, incentives, and approaches globally.viii
     Long-term policy leadership: Strong, certain, long-term 
emissions standards and targets are critical to giving manufacturers 
the certainty about future markets necessary to make large long-term 
investments in advanced technology manufacturing. Where countries' 
markets lead, investment follows. Over the past decade U.S. vehicle 
emissions standards have moved to equal or exceed those worldwide. As 
shown in Figure 1 below, however, a rollback of current fuel economy 
standards would put other nations back in the driving seat. The Motor 
Equipment Manufacturers Association-the largest automotive supplier 
association-has testified to the impact that this change in direction 
and continued uncertainty could mean to decisions multinational 
corporations make with respect to where they located their advanced 
technology manufacturing.ix
     Turning innovation into manufacturing and jobs: A number 
of countries, but particularly Germany and the EU, have more 
comprehensive programs for coupling R&D, commercialization, 
manufacturing, and workforce development and a focus on developing 
expertise and manufacturing across the full electric propulsion supply 
chain.x Many opportunities exist to better coordinate and 
fund U.S. RD&D and manufacturing programs, and to better ensure that 
taxpayer funded innovation, patents, and intellectual property are 
turned into to domestic manufacturing and jobs gains.
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    5. In your testimony, you described the Solidarity for Climate 
Action principles labor unions and environmental groups developed 
jointly. The principles include a call for a commitment to high-quality 
job creation across all sectors of the economy, but especially related 
to clean energy, adaptation, and resilience. There are existing 
domestic manufacturing plants that could be retooled or converted to 
focus on manufacturing advanced and electric vehicles and other new 
technologies. What kind of Federal policy could incentivize companies 
to invest in upgrading these plants?
    There is a lot more federal policymakers could do to help ensure we 
manufacture advanced and electric vehicles and technology--and other 
clean energy, technology and materials--in existing manufacturing 
plants, and that America's manufacturing workers and communities see 
the benefits of technological innovation and change.
    As discussed above, an effective clean technology manufacturing 
agenda would couple globally leading energy and vehicle standards and 
targets--which give companies the certainty they need to invest in 
America--with an aggressive push to manufacture vehicles and strategic 
components here in the United States.
    As part of a robust and coordinated manufacturing agenda, any new 
industrial bank or revolving loan program should prioritize investment 
in existing or idle facilities and in deindustrialized, impacted, 
underinvested communities. There is also room to better utilize 
existing programs. The ATVM Loan Program, for example, expressly funds 
manufacturing retooling and plant conversion and could be improved and 
expanded to be applicable to a wider range of facilities. Similarly, 
Section 132 of the Energy Independence and Security Act of 2007 created 
a program to provide grants specifically to convert existing or 
recently closed facilities to build clean vehicle technology--but was 
never funded by congress.
    In addition, policymakers need to stop and reverse actions and 
policies that encourage plant closures and offshoring and drive the 
jobs of the future overseas. This includes:
           Realigning corporate tax and finance rules and 
        incentives to encourage investment in domestic plants and 
        workers and to discourage outsourcing and offshoring--
        particularly in critical energy and technology sectors; and
           Ensuring that any NAFTA replacement includes strong, 
        fair, and enforceable labor and environmental standards and 
        that existing trade rules and remedies are improved and 
        enforced.
    Finally our energy and climate policy choices matter. For example, 
since 2007 smartly structured fuel economy and vehicle GHG standards 
have driven tens of billions of dollars in reinvestment in American 
manufacturing across the automotive supply chain.xii As we 
discuss in detail in our recent report Tech@Risk, the proposed rollback 
or radical weakening of these standards not only puts jobs in todays 
factories at risk, it discourages future investment to locate, upgrade, 
retool, or convert American factories to build the clean vehicle 
technologies of the future at the potential cost of nearly 90,000 
future manufacturing jobs.xiii
    6. Congress has provided incentives to wind and solar companies to 
expedite deployment of this zero-carbon source of electricity. When 
crafting these incentives, how can Congress ensure workers benefit from 
this expanding sector?
    As discussed above, all our major incentives and public 
investments--not just those in infrastructure--can and should be 
structured to ensure they create good jobs and build strong clean 
energy manufacturing industries in America.
    Congress should consider requiring strong procurement policies that 
ensure the use of domestic, clean, and safe materials and technology 
made by law-abiding corporations throughout the supply chain for all 
purchases made with public funds provided by tax incentives. In 
addition, Congress should consider requiring mandatory labor standards 
for employers accepting clean energy tax incentives--including 
prevailing wages, safety and health protections, project labor 
agreements, community benefit agreements, local hire, and other 
provisions and practices that prioritize improving training, working 
conditions, and project benefits.
    The Good Jobs for 21st Century Energy Act recently introduced by 
Senator Merkley and 10 co-sponsors provides an initial example of some 
such policy provisions with respect to energy tax 
credits.xiv
                        the honorable mike levin
    1. Ms. Lipman, what are your views on a Federal ``Buy Clean'' 
policy?
    The manufacture of raw building materials like steel and cement 
produces 11% of total global greenhouse gas emissions and is on the 
rise. But because these commodities are exported around the world, the 
countries that consume them rarely account for the carbon it took to 
produce them, and manufacturers are not rewarded for making low-carbon 
products.
    Buy Clean policies help close this ``carbon loophole'' by helping 
ensure taxpayer dollars are spent on climate-friendly materials for 
infrastructure and building projects. Wide-scale adoption of Buy Clean 
state and federal purchasing programs would reward companies that are 
cleaner and more efficient. It would give American manufacturers and 
workers a tremendous opportunity to take the lead in growing markets 
for low-carbon products, and help prevent the offshoring of pollution 
and jobs overseas.
    2. If Congress were to adopt a Federal ``Buy Clean'' policy, what 
essential elements would need to be part of the policy?
    In crafting a policy of this kind, it is essential to work together 
with agencies, business, labor, and other key stakeholders to develop a 
strong solution and policy framework.
    A key design consideration should be the impact of this policy on 
the U.S. industrial sector and the competitiveness of our 
manufacturers. The policy must result in a strengthening of U.S. 
manufacturing and ensure quality manufacturing jobs here in the United 
States. Without careful attention to the trade exposed nature of these 
industries, unintended consequences could occur. This consideration 
should inform policy design, including structure and application of the 
standard.
    At a federal level it would be helpful to identify what products 
the federal government procures by agency above a certain de minimus 
threshold, in order to craft a policy that is most efficient and 
impactful. In general, however, the policy could be structured in the 
following ways:
           Apply to procurement of all construction materials 
        for public building and infrastructure projects;
           Apply to procurement of products within a material 
        type, rather than between material types; and
           Create a selected list of ``eligible materials'' 
        determined by domestic manufacturing, current emissions levels, 
        and potentially considering trade exposed products.
    Congress could also consider incorporating high labor standards and 
land, air, and water pollution into procurement determinations. We 
believe this could work in tandem with Buy Clean, where the federal 
government would set emissions, pollution and labor standards for an 
``eligible entity'' to be able to be considered for federal public 
projects.
    Finally, any Buy Clean policy must go hand in hand with 
complementary policies that invest in U.S. manufacturing. Ultimately, 
Buy Clean policy should make U.S. industry stronger and more 
competitive. These investments should include funding and financing for 
investments to reduce emissions in the industrial sector, technical 
assistance, and increased funding for research, development, 
demonstration, and deployment of the transformative technologies that 
will be required to decarbonize the industrial sector.
                            references page
    i The Washington Post, ``A dangerous export: America's 
car-battery waste is making Mexican communities sick'' February 26, 
2016. Available online: https://www.washingtonpost.com/sf/national/
2016/02/26/a-dangerous-export-americas-car-battery-waste-is-making-
mexican-communities-sick/?utm_term=.6c896eec67bc
    ii U.S. Department of Energy (DOE), Office of Energy 
Efficiency & Renewable Energy, ``Computing America's Offshore Wind 
Energy Potential,'' September 9, 2016. Available online: https://
www.energy.gov/eere/articles/computing-america-s-offshore-wind-energy-
potential
    iii Center for American Progress. ``Green Recovery: A 
Program to Create Good Jobs and 
Start Building a Low-Carbon Economy.'' Political Economy Research 
Institute, University of 
Massachusetts Amherst, http://www.peri.umass.edu/fileadmin/pdf/
other_publication_types/peri_report.pdf
    iv National Renewable Energy Laboratory, Large-Scale 
Offshore Wind Power in the United States, September 2010. Available 
online: https://www.nrel.gov/docs/fy10osti/40745.pdf
    v Deepwater Wind, ``Block Island Wind Farm.'' Available 
online: http://dwwind.com/project/block-island-windfarm/
    vi Deepwater Wind, ``Block Island Wind Farm begins 
commercial operations,'' December 12, 2016. Available online: 
www.dwwind.com/press/americas-first-offshore-wind-farm-powers/
    vii Stephanie A. McClellan, Supply Chain Contracting 
Forecast for U.S. Offshore Wind Power, March 2019. Available online: 
https://www.ceoe.udel.edu/File%20Library/About/SIOW/SIOW-White-Paper---
SupplyChain-Contracting-Forecast-for-US-Offshore-Wind-Power-FINAL.pdf.
    viii United Auto Workers, Taking the High Road: 
Strategies for a Fair EV Future, Spring 2019. Available online: https:/
/uaw.org/wp-content/uploads/2019/07/EV-White-Paper-Spring-2019.pdf
    ix Motor & Equipment Manufacturers Association, Fuel 
Economy Standards: Investments and Jobs in The U.S. are on the Line, 
November, 2018. Available online: https://www.mema.org/sites/default/
files/2018%20MEMA%20CAFE%20White%20Paper%20-%20FINAL.pdf
    x United Auto Workers, Taking the High Road: Strategies 
for a Fair EV Future, Spring 2019. Available online: https://uaw.org/
wp-content/uploads/2019/07/EV-White-Paper-Spring-2019.pdf
    xi International Council on Clean Transportation, Chart 
library: Passenger vehicle fuel economy. Available online: https://
theicct.org/chart-library-passenger-vehicle-fuel-economy
    xii BlueGreen Alliance, Driving Investment: How Fuel 
Efficiency is Rebuilding American Manufacturing, January 25, 2019. 
Available online: https://www.bluegreenalliance.org/resources/driving-
investment-how-fuel-efficiency-is-rebuilding-american-manufacturing/
    xiii BlueGreen Alliance, Tech@Risk: The Domestic 
Innovation, Technology Deployment, Manufacturing, and Jobs at Risk in 
Stepping Away From Global Leadership on Clean Cars, August 1, 2019. 
Available online: https://www.bluegreenalliance.org/resources/techrisk-
the-domestic-innovation-technology-deployment-manufacturing-and-jobs-
at-risk-in-stepping-away-from-global-leadership-on-clean-cars/
    xiv Senator Jeff Merkley, H.R. 3068, the Offshore Wind 
Jobs and Opportunity Act, July 18, 2019. Available online: https://
www.merkley.senate.gov/news/press-releases/merkley-trumka-senate-
democrats-announce-major-new-legislation-to-create-good-paying-jobs-in-
the-transition-to-clean-energy-2019

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