[Senate Hearing 116-292]
[From the U.S. Government Publishing Office]
S. Hrg. 116-292
THE PRESIDENT'S BUDGET REQUEST
FOR THE DEPARTMENT OF ENERGY
FOR FISCAL YEAR 2020
=======================================================================
HEARING
BEFORE THE
COMMITTEE ON
ENERGY AND NATURAL RESOURCES
UNITED STATES SENATE
ONE HUNDRED SIXTEENTH CONGRESS
FIRST SESSION
__________
APRIL 2, 2019
__________
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Printed for the use of the
Committee on Energy and Natural Resources
Available via the World Wide Web: http://www.govinfo.gov
______
U.S. GOVERNMENT PUBLISHING OFFICE
36-262 WASHINGTON : 2020
COMMITTEE ON ENERGY AND NATURAL RESOURCES
LISA MURKOWSKI, Alaska, Chairman
JOHN BARRASSO, Wyoming JOE MANCHIN III, West Virginia
JAMES E. RISCH, Idaho RON WYDEN, Oregon
MIKE LEE, Utah MARIA CANTWELL, Washington
STEVE DAINES, Montana BERNARD SANDERS, Vermont
BILL CASSIDY, Louisiana DEBBIE STABENOW, Michigan
CORY GARDNER, Colorado MARTIN HEINRICH, New Mexico
CINDY HYDE-SMITH, Mississippi MAZIE K. HIRONO, Hawaii
MARTHA McSALLY, Arizona ANGUS S. KING, JR., Maine
LAMAR ALEXANDER, Tennessee CATHERINE CORTEZ MASTO, Nevada
JOHN HOEVEN, North Dakota
Brian Hughes, Staff Director
Kellie Donnelly, Chief Counsel
Brianne Miller, Senior Professional Staff Member and Energy Policy
Advisor
Sarah Venuto, Democratic Staff Director
Sam E. Fowler, Democratic Chief Counsel
Renae Black, Democratic General Counsel
David Gillers, Democratic Senior Counsel
C O N T E N T S
----------
OPENING STATEMENTS
Page
Murkowski, Hon. Lisa, Chairman and a U.S. Senator from Alaska.... 1
Manchin III, Hon. Joe, Ranking Member and a U.S. Senator from
West Virginia.................................................. 3
WITNESS
Perry, Hon. Rick, Secretary of Energy............................ 4
ALPHABETICAL LISTING AND APPENDIX MATERIAL SUBMITTED
Manchin III, Hon. Joe:
Opening Statement............................................ 3
Murkowski, Hon. Lisa:
Opening Statement............................................ 1
Perry, Hon. Rick:
Opening Statement............................................ 4
Written Testimony............................................ 7
Responses to Questions for the Record........................ 59
THE PRESIDENT'S BUDGET REQUEST
FOR THE DEPARTMENT OF ENERGY
FOR FISCAL YEAR 2020
----------
TUESDAY, APRIL 2, 2019
U.S. Senate,
Committee on Energy and Natural Resources,
Washington, DC.
The Committee met, pursuant to notice, at 10:06 a.m. in
Room SD-366, Dirksen Senate Office Building, Hon. Lisa
Murkowski, Chairman of the Committee, presiding.
OPENING STATEMENT OF HON. LISA MURKOWSKI,
U.S. SENATOR FROM ALASKA
The Chairman. Good morning, everyone. The Committee will
come to order. We are here this morning to discuss the
President's budget request for the Department of Energy for
Fiscal Year 2020.
Mr. Secretary, it is good to have you back in front of the
Committee again. We appreciate it. It seems like it has been a
really quick year, at least maybe for me, and I would imagine
for you as well.
We are back with a conversation again about the budget. In
looking at the budget, actually many parts of this look
familiar to where we were last year.
I am pleased to see the President's budget seeks to
increase funding to address vulnerabilities in our electric
infrastructure. Ensuring the cybersecurity and resiliency of
our nation's grid is really a top priority for many of us here
on this Committee, so it is good to see your priority is here
as well.
These issues also fall squarely in our jurisdiction, which
is why we have devoted significant time to these challenges,
including in the area of electromagnetic pulses and geomagnetic
disturbances. So, again, it is good to see the Department
focused so keenly on them.
While I do appreciate many parts of this budget, there are
other parts that I will disagree with. It seems like we always
get to the disagreeing part of it rather than the things that
we do agree on. But there are significant areas--your focus on
national labs, on the advanced nuclear, on the exascale
computing, quantum information science--these are all matters
that have come before our Committee that we have enjoyed some
success in moving legislation out. So these are certainly areas
of support.
We have also been talking a lot in this Committee this year
about the issues of climate, what we can be doing to reduce
emissions more broadly, what we can do to enhance our
efficiencies to reduce costs for power generation and really
just be better environmental stewards.
I think, as we talk about those opportunities moving
forward, and we had a chance in the Appropriations Energy and
Water Subcommittee last week with Chairman Alexander who chairs
that Approps Subcommittee, talking about his Manhattan
challenge for us if you will. Much of what he has outlined in
terms of ways that we can make an impact really lies squarely
within the Department of Energy.
So it is somewhat disappointing to see the budget request
again putting programs that promote energy innovation and
cutting-edge science on the chopping block. I know many of my
colleagues share the disappointment in the request to eliminate
ARPA-E, a program that brings the private sector together with
the national laboratories and universities to bridge the valley
of death for emerging energy technologies.
Your budget request also eliminates both the Weatherization
Assistance Program and the State Energy Programs, and I will
get a little parochial here because these are so important to a
state like mine.
I do appreciate the efforts of the Department to work with
Alaska Native villages so that they, and tribes across the
country, can access the Tribal Energy Loan Guarantee Program,
but I am troubled that the budget request proposes to eliminate
that program, just as it is now getting off the ground.
These are the types of programs that help Alaskans as they
are addressing the high energy prices, really the highest
energy prices in the nation. And Mr. Secretary, when you were
with me in the state, when we had an opportunity to go to
Kodiak and to Old Harbor, you saw firsthand how these
challenges that we face, I think, challenge us to be more
innovative and to seize on some of the innovation opportunities
that we're working to advance.
You saw an electric grid powered by nearly 100 percent
renewable energy in Kodiak, and then you saw the first stages
of a small hydro there at Old Harbor. These are not only part
of Alaskans' efforts to reduce greenhouse gas emissions, they
also reduce the high cost of diesel fuel, which again you saw
firsthand, so that residents can stay in their communities, and
open up new economic opportunities.
It is communities like these, spread all over our country,
that stand by ready to innovate and transition to a cleaner
energy future, but they need our help, and they need the help
of the Department of Energy. Programs like those proposed for
elimination, and offices like the Office of Indian Energy, are
vital to our future and our ability to move forward.
We all know that we need to make responsible cuts to the
budget, but we don't want to forget the critical role that
innovation plays for us in helping to create jobs, boost
economic growth, increase competitiveness, and strengthen our
long-term security.
So upon initial review and without all the details of the
budget, I do have some concerns about the proposals. I have
outlined a couple. But I also recognize that this is a starting
place, this is where we begin the conversation about your
priorities, about the President's priorities, and the
priorities of those of us here. And that from here it is
incumbent on all of us to seek that common ground and areas for
compromise.
So I look forward to our discussion and then moving forward
after this. Again, Mr. Secretary, I appreciate a great deal
your leadership and being here this morning.
Senator Manchin.
STATEMENT OF HON. JOE MANCHIN III,
U.S. SENATOR FROM WEST VIRGINIA
Senator Manchin. Madam Chairman, thank you again for
gathering our Committee together today for this important
hearing. And I want to welcome my friend, Secretary Perry. He
and I have worked together a long time back in the good old
days of being governors, and it is a pleasure to welcome you
and your third presentation hearing before the Committee as
Secretary of Energy, which I am understanding you consider your
coolest job. Well I am happy to continue working with you in
what I consider a new cool role as the Ranking Member, so it is
going to be exciting.
The energy sector is undergoing rapid change. The natural
gas revolution is still going strong, the grid is getting
cleaner and more efficient, and every day we have new cyber and
resilience challenges to tackle.
And the conversation around climate change is center stage.
The conversation that we have had here, myself and the
Chairwoman, has not shied away from that in this Committee. But
when I look at the Administration's budget request, I am
disappointed to see numbers that neither reflect the priorities
of the Department nor get us where we need to go in order to
tackle carbon emissions.
Looking at the top line, the budget request proposes
cutting non-National Nuclear Security Administration funding to
the Department of Energy by over 25 percent. I think this
proposal would limit the DOE in a number of critical ways,
including its ability to maintain a global leadership role in
research and development.
In my view, the United States as a leader in energy
production has a unique and necessary role to play in
developing and commercializing innovative technology solutions
for the climate problems that we are facing globally. The
International Energy Agency, or the IEA as we know it, reported
earlier this week that global energy demand grew by 2.3 percent
over the past year, and fossil fuels met a lot of that demand
and will continue to for some time.
And that is going to be the story for the next few decades
in part because the average coal plant in Asia is only 12 years
old. The fact is that fossil fuels, including coal, will
continue to be part of our energy mix. And if we can agree on
that, it is clear as day to me that the United States needs to
put its money where its mouth is in advanced solutions like
carbon capture, storage and sequestration.
It is also what the experts are saying. Dr. Birol, of the
IEA, told the Committee just last month that CCUS may be the
most critical technology that we can invest in. We need a
moonshot when it comes to carbon capture, so I am working on
legislation that will refocus the DOE on coal and natural gas
RD&D. My hope is that between the brilliant minds at your DOE
and our national labs and the private sector, we can crack this
nut sooner than later. I think we can all agree that this kind
of innovation is necessary to ensure economic competitiveness,
environmental responsibility, energy security, and national
security.
In addition, we need to keep up the good work at the
Advanced Research Projects Agency-Energy, or ARPA-E, which is
another critical part of ensuring U.S. leadership in advanced
energy technologies in a tech race with China.
Then there is the Loan Program Office, which I am very much
concerned about. A program with a high repayment rate that has
made money for taxpayers, it is a perfect tool to promote
public-private partnerships for innovative energy technologies,
especially advanced fossil technology.
I was very disappointed to see proposals to eliminate both
of these valuable programs when right now we need to be
fostering them.
On the other hand, I was pleased to see that the budget
request included a significant 30 percent increase in funding
for the Office of Cybersecurity, Energy Security, and Emergency
Response, or CESER for short. Our folks at NETL in West
Virginia are responsible for managing about a third of that
funding.
I am also optimistic about what we can accomplish together
this year on some of the tougher issues like nuclear waste
storage and disposition. I look forward to working with you at
the DOE and Chairwoman Murkowski and our Appropriations
colleagues on that.
I was also encouraged to hear that in your Appropriations
hearing last week you expressed willingness to work with
Senator Alexander on R&D goals. I share his desire to increase
funding and focus the Department on those technologies that
will achieve emission reductions. I will introduce R&D
legislation of my own in the coming days, and I look forward to
working with you as well as Senator Alexander, Chairwoman
Murkowski, and other colleagues to get that across the finish
line.
I know that you share my desire to get the funding for DOE
right, and I look forward to working with you on that.
With that, Secretary Perry, thank you for joining us today
and for all you do at DOE and for our country. I look forward
to hearing your presentation.
The Chairman. Thank you, Senator Manchin.
Secretary Perry, it is indeed a pleasure to have you back
before the Committee. We welcome your comments this morning and
the opportunity to engage in a little bit of back and forth
about this budget.
So you may proceed.
STATEMENT OF HON. RICK PERRY, SECRETARY OF ENERGY
Secretary Perry. Madam Chair, thank you very much. Ranking
Member Manchin and members of the Committee, it's an honor to
appear before you today to discuss the President's FY 2020
budget request for the Department of Energy.
It continues to be a great privilege and an honor to serve
as the 14th Secretary of Energy. It's a very exciting time to
be at the helm of the DOE. I look forward to working with each
of you on passing a budget that invests in the nation's
priorities in energy and science and national security while at
the same time continuing our shared support of innovations that
have led to America's world leading yet often overlooked
progress in reducing energy-related emissions.
When I appeared before the Committee last year, I committed
to rebuild and restore our nation's security to protect our
critical electric grid and energy infrastructure from cyber
threats, in particular, to improve the resilience and
reliability of the nation's electricity system, continue to
seek a federal disposal solution for the nation's nuclear
waste, to invest in early stage, cutting-edge research and
development and to advance our leadership in exascale and
quantum computing.
I'm proud to report to you that since then DOE has advanced
each of those goals. This budget request of $31.7 billion seeks
to build upon that great progress by making strategic
investments that yield the best return on investment for
taxpayers that benefit our country in the years to come.
This budget is a request by the American people through
you, their representatives in Congress, to secure America's
future through energy independence, scientific innovation, and
national security. As such, it represents a commitment from all
of us at DOE to honor the trust of our citizens with increased
stewardship, accountability, and commitment to excellence.
This request supports the Department's vast mission in a
fiscally responsible way. It makes clear that success will be
measured not by the dollars spent, but by the results achieved
on behalf of the American people by investing in reliable,
affordable energy, transformative innovation, and national
security.
We're approaching the dawn of what I call the New American
Energy Era, a time of energy abundance, security and, yes, I
will say, even independence. American energy independence, it
used to be a sound bite, but thanks to innovation, today it is
a reality.
The Department's world leading science and technology
enterprise generates the innovations we need to fulfill our
mission through support of our cutting-edge research at our 17
national labs and, I might add, over 300 universities, many of
whom or I should say, a number of them in your home states. We
are expanding the frontiers of scientific knowledge and
accelerating the pace of discovery to address our greatest
challenges.
This past fall I fulfilled a commitment to visit all 17 of
our national labs and got to witness firsthand the brilliant
work that's performed by these dedicated individuals. These
labs have a rich history of science and innovation and together
they have bettered countless lives around the globe.
I'm especially proud of the work the labs are doing in
collaboration with others to harness the power of our world-
class supercomputers to maintain America's leadership in high
performance computing, advanced exascale computing, and push
for breakthroughs in artificial intelligence.
To do so, this budget proposes investments in early stage
research and development that will focus the intellectual
prowess of our scientists and engineers on the development of
technologies that the private sector can convert into
commercialized applications to improve the lives and the
security of all Americans.
This budget also requests significant funding to modernize
the nuclear security enterprise, further our non-proliferation
efforts, propel our nuclear navy at sea as well as simply to
power the fleet of the future. As we work to include America's
nuclear energy industry in our all-of-the-above strategy, we
see great promise in next generation advanced reactor
technologies.
In the coming weeks and months I look forward to working
with you, your colleagues and excellent staff here in Congress
on the specific programs mentioned in the testimony and
throughout the Department.
Congress has an important role in the path forward. I met
with many of you already. I look forward to deepening our
partnership for the benefit of the people that we serve.
On a final note, I would be remiss if I didn't take the
opportunity to express my sincere gratitude to both of you, in
particular, and the Committee as a whole, for approving our
four remaining nominees. Our Senate confirmed key positions of
leadership: nuclear energy, Office of Science, ARPA-E and my
general counsel. Thank you. I never thought I'd be sitting in
front of a Committee saying thank you for getting me a lawyer--
--
[Laughter.]
----but after two and a half years without a lawyer, thank
you very much for doing that.
So anyway, I look forward to working with you in this new,
I said this earlier, this New American Energy Era. And you have
my pledge that at DOE we're going to continue to run the place
efficiently, effectively, and to accomplish our mission driven
goals of advancing energy security, economic security and
national security for the American people.
So with that, Madam Chair, thank you for your time and your
partnership as we go forward. Certainly, Joe, thank you,
Governor, for your whole friendship, and I look forward to
continuing our work together.
Thank you.
[The prepared statement of Secretary Perry follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
The Chairman. Mr. Secretary, thank you.
I know members have a host of different questions. Let me
begin by asking a question that I raise in every Committee that
I am privileged to serve on when I have a member of the Cabinet
in front of us. And this is the issue of the Arctic because we
recognize, perhaps not every day, but I certainly recognize
that we are an Arctic nation.
We are an Arctic nation because of my state, but this is
not Alaska earmarks. This is not just Alaska we are talking
about. We are talking about the role that the United States of
America plays with its other Arctic partners.
Whether it is on issues of environment or research or
development or indigenous peoples or defense, this is a
significant part of the globe and I am trying to make sure that
from the government perspective we recognize that there is a
role there.
As you know, we had previously, within the Department, an
Arctic Energy Office. We, in the Appropriations Committee,
certainly moved to help advance that last year. My hope would
be that that is something that within the Department there is
some recognition or consideration of reopening that Arctic
Energy Office.
We know that it is not just one office though that can
constitute a policy initiative. When you were up in the state
and, again, I thank you for the visit that you made, but
shortly after you left, we had a conference at the University
of Alaska Fairbanks. We hosted the National Lab Day. We had
many of the directors of our national labs, and it was a great
reminder of the collaboration that goes on with our labs and
our universities. That is certainly one way that we can help to
facilitate and do more when it comes to shining the light on
Arctic issues.
I raised, last week at the Appropriations hearing, the fact
that we have only two Indian Energy Office employees in the
whole State of Alaska. We would like you to take a look at
that.
But can you tell me, from the perspective of the Department
of Energy, how you are prioritizing or recognizing the role
that we play in the Arctic?
Secretary Perry. Senator, thank you.
I think it's important to come and to put boots on the
ground, so to speak, to be there to see what all is going on in
a particular part of the country. Being, you know, from a
relatively tropical part of the United States and my history
being in Texas and what have you, although I had been to Alaska
a number of times, both as an Energy Committee member back as a
state house member, to be there with you to go not only up on
the North Slope but also to go into the community of Old Harbor
and sit and talk to the Burns Family about the challenges that
they have there and recognize that the United States is an
Arctic nation. And I think that's sometimes very important for
us to recognize that the United States is an Arctic nation.
So the commitment to that region and to recognize the
valuable resources that are encompassed in that area and the
unique challenges that that has. Kevin Foster, who runs our
Office of Indian Affairs, is very, very familiar with that area
and let's expand the conversation about the office up there and
the personnel side of it. But I want to make sure that the
people of Alaska know that number one, we understand the
challenges and the uniqueness of it but there are a lot of
pieces of this puzzle, if you will. The architecture of the
Arctic is part of the DOE's mission.
So, you know, developing those resources, the rare earth
minerals that are in that area and the innovation. You and I
have talked about advanced reactors and how they can play a
unique role up to and including microreactors out on the Adak
peninsula for some defense needs out there and, frankly, for
some of the private sector needs as well.
We're going to assure you that the Department, through its
partners and its activities, will continue using those Arctic
energy resources in a very productive way.
NETL's Arctic Energy Office is going to continue to
coordinate with academia and other government agencies to
demonstrate the value of Alaska's fossil fuel resources as well
as hopefully some of our nuclear, obviously what you're doing
on wind that we saw and the battery storage side of this.
And I will just make mention that I think in the last two
years this country has increased its solar energy production by
90 percent. So an all-of-the-above strategy of which the Arctic
is going to play an important role is not lost on us.
The Chairman. Well I appreciate that and I would welcome
further conversations about the specifics and, again, my
continued interest in an Arctic Energy Office, recognizing that
this goes far beyond just Alaska.
But I know that you have been invited, certainly by the
Arctic Circle Assembly, this is an annual gathering in Iceland,
of those that are interested in all things Arctic but for you
to speak to the level of innovation is something. It is a
conference that I have attended on numerous, numerous
occasions. I believe Senator King has joined as well, but it is
something that you might want to consider. I will look forward
to further discussions on that.
Let's go to Senator Manchin.
Senator Manchin. Madam Chairman, I am going to defer to
Senator Stabenow who has another pressing committee meeting.
Senator Stabenow. Well, I appreciate the courtesy of my
colleague and leader. And thank you to both of you, and
welcome, Secretary Perry.
This is the third time you have been before the Committee
in terms of the budget. And while it is good to see you, I have
to say that while you are talking about a New America Energy
Era, unfortunately what I see in the energy budget is a budget
that guts programs that support American ingenuity and our
global preeminence in fields like advanced manufacturing, clean
vehicle and energy technologies, and cutting-edge research.
Now I will say there is an exception to that. I want to
thank you for your continued support because this budget does
include funding for what we call the FRIB project at Michigan
State University, which I have talked to you about a number of
times--the Facility for Rare Isotope Beams which will be the
world's most powerful radioactive beam facility and will
advance new defense, environmental, and medical technology. So
I am very appreciative that this project is continuing and the
support is in here for that.
But frankly, when I look at the rest of the budget, it is
very concerning to me. I know that you said this is a starting
point for discussion and that you are committed to working with
us, but the budget is a clear statement about what the
Administration does and does not prioritize.
What we have is an overwhelmingly prioritized budget on
fossil fuels at the expense of clean energy and advanced
vehicle technologies and domestic manufacturing.
When you look at the budget calling for the repeal of the
tax incentives for electric vehicles, renewable energy and
energy efficiency, I am really glad Senator Lamar Alexander and
I are putting in the bill in the next few days that would
actually extend the cap so that we could have more consumer tax
credits for electric vehicles. This budget does away with that.
You cut the Office of Energy Efficiency and Renewable
Energy by 86 percent; advanced manufacturing by 75 percent;
vehicle technologies by 79 percent; eliminate ARPA-E that you
talked about earlier; Title XVII; the advanced vehicle loan
program. I mean, just on and on and on. And yet, renewable
energy is the fastest growing source of U.S. electricity and
the future of transportation as we know it is in electric
vehicles and alternative fuels, which we need to be working
with the industry on to help them to be able to get there.
And then finally, I have to underscore that we have the
disastrous effects of carbon pollution right in front of our
face every single day now--the atmosphere heating up as a
result of carbon pollution and what is happening in the swings
in snow, rain, drought, wind, and fires. In fact, we are now
working on the Floor on a disaster package that is a result of
not tackling carbon pollution.
So while I come from a state, I am very proud to say, that
really led the industrial revolution, and we certainly
benefited from the power of fossil fuels, we better be paying
attention now to what is happening here or our kids and
grandkids, frankly, are never going to forgive us for what is
going on.
Given the clear market trends, as well as what is happening
here all around us, the science says we have 12 years to curb
our emissions to avoid catastrophic global warming and the
significant investments of our global competitors in clean
energy, led by China. Why then is this Administration proposing
to do the exact opposite, to really take us backward? I
appreciate what you said, but the budget takes us backward. And
how will this benefit us going forward with what we need to do
in terms of jobs, clean energy, and tackling carbon pollution?
Secretary Perry. Senator, absolutely.
One of the things that I talk about on a fairly regular
basis is the progress that the United States is making when you
look at the emissions side of it.
And I want to address directly your question about advanced
manufacturing and what we're doing at Oak Ridge and the work
we're doing there. As a matter of fact, I think it was last
year, I drove up and down Independence Avenue in a vehicle that
was made out of a carbon fiber that was hydrogen fueled. And
that's the type of work that's coming out of our national labs.
Senator Stabenow. With all due respect, I just want to say,
I know. That's great. But you're not supporting the consumer
tax credits to be able to allow people to purchase those
vehicles until we get to a point where there's enough volume
that the price comes down so that people can afford them. And
that is my concern because I agree with you, there's incredible
technologies that are going on, but the capacity to support
their integration into the economy and for consumers having
access is my concern.
Secretary Perry. Well, and again, one of the things that I
will share with you, as I did the last two times I was in front
of this Committee, is the good news for me is I was an
appropriator once upon a time and I've been a chief executive
and I humorously say that my budget generally ended up as a
pretty good doorstop when I was the Governor of Texas.
I'm not making any comparables here, I'm just saying that I
understand how this process works. And we're here to work with
you, the members of this Committee, to come up with a budget
that prioritizes what's important.
And we can quibble about maybe what the amounts are, but I
think we do share, we have a shared interest, in not only
American technology leading and being sent around the world,
whether it's, you know, carbon capture utilization technology
that could go to China and into India to start making some real
progress. American LNG into the European to push away from
older, inefficient, dirtier burning power plants. That's the
type of progress that we've seen in the United States. We've
had the greatest reduction in emissions in this country in
history, according to the IEA.
So I think we're headed in the right direction. Are we
going as fast as some people want us to? Probably not. But the
DOE and our continued innovation in our national labs, Senator,
I think, are going to play a very important role as we go
forward in that. And we'll commit, obviously, to continue to
work with you to find the ways that American technology,
American innovation, you know, American vehicles are leading
that charge to address the issue of emissions and obviously,
creating good paying jobs in the United States.
Senator Stabenow. Well, thank you.
Thank you, Madam Chair.
And I would just say I think this budget would make a good
doorstop.
Thank you.
[Laughter.]
The Chairman. Thank you.
Let's go to Senator Cassidy, please.
Senator Cassidy. Hello, Mr. Secretary.
Dr. Birol, the IEA Director, testified before the Committee
a few weeks ago telling us that carbon capture, utilization,
and storage (CCUS) is the most critical technology we can do to
lower our emissions aside from maybe the continued use of more
natural gas and renewables. And you have been committed to
that. I appreciate that.
But I guess as we are looking at this kind of nexus, if we
are looking at carbon capture, utilization, and storage, I
think most of the research has been with coal. And yet, natural
gas is an increasing amount of our feedstock for our grid.
So to what degree is the research being done on CCUS being
directed toward the increased use of natural gas on our grid?
Secretary Perry. Okay.
Senator, we've got a couple, just to be really specific,
we've got a couple of funding opportunities here of about $60
million--
$30 million of that from some front-end engineering and design
on carbon capture systems and then we've got a FOA that's out
at
this particular point in time for the same amount, $30 million,
to continue the Carbon Storage Assurance Facility Enterprise
(CarbonSAFE).
And you know, one of the first projects I went to not only
observe but to officially open as the Secretary of Energy was
just outside of Houston, the Petra Nova project. It was coal.
It was a coal plant taking 95 percent of the emissions out and
then taking those emissions, shipping them some 75 miles away
to a crude oil field where it was used for, excuse me, tertiary
recovery and had a pretty massive effect on that oil field.
So the stories that are out there and the real-life
examples of this, I think, have a great role to play, not just
in the United States, but particularly getting outside of the
U.S.
Senator Cassidy. I agree with that, but what I understand
is that, for example, the oxygen content of natural gas
emissions is higher so that presents a different issue than if
it is just coal. In that sense, the BTU per carbon footprint is
so much better with natural gas than coal that you actually
have less CO2 being spun off so that in itself
presents challenges.
Secretary Perry. Correct.
Senator Cassidy. And so, to what degree is the research and
yet we have seen that the percent of feedstock that natural gas
represents in terms of generating electricity continues to
climb. I guess my question is, to what degree is the research
being promoted by the Department of Energy recognizing that
natural gas has its unique issues and that it is an increasing
amount of the grid so therefore the research needs to be
specific for the natural gas product, if it will?
Secretary Perry. Senator, let me get back with you with any
specificity about what the Department is doing on the specific
issue of what you asked about on natural gas.
Senator Cassidy. I am good with that.
Secretary Perry. Great.
Senator Cassidy. Next, let's talk about the SPR, Strategic
Petroleum Reserve.
Secretary Perry. Yes, sir.
Senator Cassidy. Just your thoughts.
Obviously we have increased production in the United States
and we still have this large storage of oil. What are your
thoughts since we are producing so much more as to the
continued need of and long-term outlook for the SPR?
Secretary Perry. Yup.
Senator, I think it's really a timely discussion to have
about the Strategic Petroleum Reserve, as everyone around the
table and hopefully most of the public knows it was created
right after the, you know, after the mid-'70s and the oil and
gas crisis that we had in that period of time.
It was put in place not only as a national security issue
but as a reserve in case of a major national disaster. We
tapped into it a number of times, our states having had
hurricanes, certainly after Sandy. And having a national
petroleum reserve, a Strategic Petroleum Reserve, makes sense.
Now the world has changed in the last 42 years since it was
created. Number one, that the United States now is the number
one oil and gas producing country in the world. Do we need that
big of a reserve, particularly with the growth of the pipeline
infrastructure that we have and the growth in that
infrastructure that's going to occur over the next decade?
I mean, we're going to see massive amounts of pipelines
being built around the country that can be part of a reserve.
We have a requirement internationally to keep a certain amount
of crude available for our international partners, but I think
you're absolutely correct in having a public dialogue about
this. Is the SPR the right size? Can we contract it? Can you
rent part of it out to the private sector for storage?
I mean, I think all of this is an appropriate discussion.
It's time to renew this, the focus on this and potentially,
certainly, I leave it up to you members of Congress but I think
you'll get it right. But it's time to have this conversation
about do we need to modernize the Strategic Petroleum Reserve?
Senator Cassidy. I am out of time, but I will say that I
have an interest as well in the benefit to the federal taxpayer
of leasing out some of that excess space.
Secretary Perry. Yes, sir.
Senator Cassidy. It would save a lot of future development.
But I yield back. Thank you. Thank you. Mr. Secretary.
The Chairman. Thank you.
I know that, certainly in this Committee, we focused on the
need for that modernization to make sure that it was able to do
what we expected and anticipated. I am trying to remember when
we got that report but thanks for bringing that question up.
Senator Manchin.
Senator Manchin. Madam Chairman, I also defer to Senator
Hirono who has another pressing meeting.
Senator Hirono. Thank you very much, Senator Manchin.
Mr. Secretary, it is not unexpected that an Administration
that does not acknowledge the science behind global warming
would come up with a budget that continues a commitment to
supporting the fossil fuel industry, even if the budget cuts 23
percent from the Fossil Energy Office. But when you look at the
other cuts to the renewable energy side, you see either total
elimination of programs or cuts along the vicinity of 86
percent, this is not really going in the right direction as far
as I am concerned.
In the year since you testified to this Committee,
California and New Mexico have joined Hawaii in requiring the
states to get 100 percent of their electricity from carbon free
resources by 2045. What Hawaii and other states need is a
federal partner to work with states and businesses to solve the
challenges involved in transitioning to 100 percent clean
power.
If Congress provides more funding for renewable energy and
energy efficiency than what you have put in the budget, will
you commit to supporting the states' efforts to transition to
100 percent carbon free energy?
Secretary Perry. Senator, you know----
Senator Hirono. Yes would be a good answer.
Secretary Perry. I am sorry.
[Laughter.]
Senator Hirono. Go ahead.
Secretary Perry. I apologize, Senator, you go ahead.
Senator Hirono. No, I would just like a yes answer from you
for that.
[Laughter.]
Secretary Perry. I know----
Senator Hirono. I long for a yes.
[Laughter.]
Secretary Perry. ----I know what your yes answer----
[Laughter.]
----your answer you're looking for.
Having been a former governor, you know, I am very
supportive of states, by and large, making their own decisions
about what direction they want to go and I'm certainly going to
respect that with those three states. Texas may have a
different idea about which direction they want to go, and I'm
going to respect that as well.
But let me just say that I'm going to follow the lead of
this Committee from the standpoint of what you find is your
funding priorities. We will take those dollars and we will
spend them as efficiently and effectively as we can and
hopefully to you, as a whole, will say that we followed your
directions.
Senator Hirono. That sounds like I could give you more
money on the renewable side that you will work with the states
to enable them to get to their goals. That's what it sounds
like to me. So is that accurate? Yes?
Okay, going on to ARPA-E. ARPA-E, as you well know, is an
innovative research model at DOE that has demonstrated
remarkable success in its short life span. But once again, the
Administration is proposing eliminating ARPA-E, an idea
Congress has rejected the past two years.
Will you commit to dispersing funds to eligible ARPA-E
projects within a reasonable time consistent with past
practices and not withhold Congressionally-appropriated funds?
Mr. Secretary?
Secretary Perry. I'm sorry.
Senator Hirono. Okay, so----
Secretary Perry. I'm having a hard time hearing you,
Senator. I apologize. I know we're on ARPA-E.
Senator Hirono. Yes. The Administration wants to eliminate
the program but there's already appropriated amounts----
Secretary Perry. Right.
Senator Hirono. ----in this program.
And my question to you is whether you will commit to
dispersing the funds to eligible ARPA-E projects within a
reasonable time----
Secretary Perry. Yes.
Senator Hirono. ----consistent with past practices? Good.
Secretary Perry. Sorry.
Senator Hirono. Getting back to renewable energy. For the
third time in a row, the budget proposal goes in the wrong
direction by slashing renewable energy and energy efficiency,
this time with cuts of $2 billion, or 85.6 percent, from the
levels set last year when Republicans controlled both chambers
of Congress.
This year's budget for the Energy Efficiency and Renewable
Energy Office, EERE, includes $353 million that Congress
already gave EERE last year but that DOE has not yet awarded at
the time the budget was being put together late last year. But
the EERE Office, as Congress intended, has continued to
allocate the funds to support energy efficiency and renewable
energy research and development.
So, if Congress actually followed your recommendations,
EERE would not only face a drastically smaller budget going
forward but would also have to cancel funding already announced
to support renewable energy efficiency research and
development. Isn't that correct? You will actually have to
cancel the funding if we went along with your budget.
Secretary Perry. Senator, again, I kind of get the process
here and I'm, you know, this isn't a take it or leave it budget
that we've obviously laid out here in front of you and we're
going to work with this Committee. So I'm going to tell you
that the dollars that we have been placing out in the field are
making a difference now.
We just announced the largest solar funding opportunity in
the history of the Department, just this week, 150 or excuse
me, $130 million in new research in advanced early stage solar
technology.
So I recognize the conflict between the budget that's laid
out but I know what reality is and between 2016 and 2018 solar
generation in this country increased by almost 90 percent and
we also see wind energy, this coming year, surpassing hydro for
the first time in history. So there's actually some pretty
positive stories, Senator, that's ongoing and a substantial
amount of that because of innovation that has come out of the
Department of Energy. We're going to continue doing that.
And most importantly, I think for you, is that you
appropriate these dollars and we're going to spend them as
efficiently and effectively as we can to meet the directions
that this Committee and Congress gives us.
Senator Hirono. Madam Chair, there's going to be, there
will be consequences if they have to cancel funding that's
already been passed and announced by the DOE. I don't know that
the Department has figured out what the consequences will be,
but there will be some.
Thank you.
Secretary Perry. Senator, just for the record. Any program,
new project that we have committed to, we've got to finish the
funding for it. So, I'm pretty sure that's statute.
The Chairman. That's the way we want it to be.
Senator Gardner.
Senator Gardner. Thank you, Chairman, and thank you, Mr.
Secretary, for your time and testimony today and your service
to the country.
I think I appreciated the statement you just made. This is
not a take it or leave it budget, I think is what you said to
Senator Hirono. I think you also talked about being able to
work with Congress with whatever is budgeted, that Congress
passes, the appropriations bills we move forward, that you will
use those dollars appropriately, responsibly, and according to
the law.
With that in mind, I think, I just wanted to highlight the
National Renewable Energy Laboratory (NREL) in Colorado,
estimated in 2017 the economic impact of more than $1.1 billion
nationwide for Colorado's economy. That was about $750 million
of economic impact.
So obviously the Office of Energy Efficiency and Renewable
Energy, which is NREL's steward and primary funder, is a very
important component for Colorado, and I think you have given me
the assurance through the answers to others but would just like
to hear it. Will you execute the budget Congress provides you
so that we can continue to see these good returns on federal
research investment as evidenced by this University of Colorado
report that showed that $1.1 billion economic impact?
Secretary Perry. Yes, sir.
As a matter of fact, I think this budget actually includes
an increase for NREL's facilities that you speak of.
Senator Gardner. Yes and we are going to continue to push
on NREL and others because, as you know, you and I had the
chance to visit NREL. We had a great visit to the lab there. I
think we painted some solar panels which was pretty incredible.
And congratulations to you on visiting all 17 national
laboratories last year. They had a great employee visit town
hall with the NREL staff and staff members.
In your testimony you talked about the work that NREL does
and other labs do, the core research of these facilities. Could
you talk a little bit more about your plans for the NREL Flat
Irons campus for megawatt scale grid integration testing and
cybersecurity?
Secretary Perry. Well, that's obviously, there's a number
of things that come together here. Obviously, the innovation
that's coming out of labs like NREL with new technologies from
the standpoint of--the Senator made reference to literally
painting on to the surface of the top of a vehicle, for
instance, a solar cell for lack of a better descriptive term.
Senator Gardner. Yes.
Secretary Perry. But the AI side of this, I think it's one
of the things, Senator Heinrich, that we have the potential to
change literally the world in these labs and the work that they
do together. Our high-performance computing, our exascale
computing and you know, hopefully very near in the future, the
quantum computing capacity.
Argonne, we were up at Argonne two weeks ago. A computer
there that does one billion, billion, transactions per second,
a quintillion. I mean, that's the power of what we're having
the ability to do.
So a lot of answers to questions on issues like energy, on
emissions, on some things that really vex us today, we're going
to have the potential to get answers to those in the not too
distant future. And that's one of the exciting things about why
focusing and, frankly, having the flexibility to move these
dollars around in the DOE budget is so important.
Senator Gardner. In your testimony you also touched on the
importance of energy storage, advancing energy storage through
the Advanced Energy Storage Initiative, including the Grid
Storage Launchpad and supporting the research at the national
lab system itself. So I am not going to ask a question on this
because I want to get to a different question, but I want to
continue to work with you on ways that we can increase
research, increase research opportunities to help decrease the
cost of energy storage. That is important to us.
Secretary Perry. It's the Holy Grail.
Senator Gardner. Yes, it is.
Finally, I just wanted to talk about a bill that I have
introduced to extend the life of the Grand Junction Disposal
Cell. This is a particular issue in the Western Slope. This is
a mill tailings disposal site in Grand Junction, Colorado, that
can store as much as 230,000 cubic yards of additional
material.
So the reason this is important. From 1950 to 1966, mill
tailings which were predominately sandy material in this area
were available to private citizens and contractors who used
them as fill material, building roads, concrete, and mortar in
this area of Colorado. The radioactive mill tailings, of
course, were then hauled to more than 4,000 private and
commercial properties in the Grand Junction area. It was not
until later that the Federal Government realized this was not a
very good idea, and it was hazardous to people's health. So we
created this disposal cell site.
Can you talk about what steps DOE will have to start taking
this year if the site's life span isn't expanded by Congress?
Secretary Perry. Well obviously, under current law, the
site is going to stop receiving material on September 30th,
2023, and obviously unless reauthorized by Congress this
initial closure will have to begin as early as this year. So
thank you for bringing it up. I mean, this is a timely issue.
Senator Gardner. These are tailings that would not be
properly disposed of that----
Secretary Perry. Correct.
Senator Gardner. ----would be remaining on people's
property that, yeah.
Secretary Perry. And I mean, from a building construction
standpoint, this could really be--have a negative impact on
sites. You know, there are alternative location disposal sites
in Utah and Texas. But this one that you speak about is really
important for your part of the world. Anyway, we stand ready to
work with you to find a solution on it, Senator.
Senator Gardner. Thanks, Mr. Secretary.
Thank you, Chairman.
The Chairman. Thank you, Senator Gardner.
Senator Manchin, did you want to take your turn or turn
to----
Senator Manchin. I am going to defer to Senator Heinrich. I
have a lot of busy people on my side of it.
The Chairman. Alright, alright.
Senator Heinrich.
Senator Heinrich. Thank you. Thank you, both.
Secretary, I was watching the President speak about energy
last week and I learned something new. He said that if it
doesn't blow you can forget about television for that night.
I thought given your experience as Governor of Texas, where
ERCOT has such high levels of penetration of wind energy, in
particular, that you might have some expertise in how you
manage all of those angry constituents when their TVs don't
work. How did you pull that off?
Secretary Perry. I didn't have an issue with that.
Senator Heinrich. So you had wind penetration levels well
above 30 percent going on 40 percent and you did not have
people calling up your office?
Secretary Perry. You've got to remember Texas is a pretty
big state, sir.
Senator Heinrich. Okay.
You might want to share that perspective with the big boss
in the White House.
Secretary Perry. Absolutely.
Senator Heinrich. We have similar experience in New Mexico.
We don't have quite the level of generation, but we are going
on two gigawatts and we are still growing. And everybody's TVs
seem to be working just fine.
I want to ask you about, I am sure you are familiar with
Urenco USA's nuclear enrichment facility that is just inside
New Mexico on the New Mexico-Texas border. They have been up
and running since 2010. They are currently meeting more than a
third of the U.S. demand for utilities for enriched uranium.
I bring this up because, in your budget, there is well over
$100 million to demonstrate a domestic enrichment technology
through a sole source contract for what effectively already
exists in the private sector. Why should taxpayers be on the
hook for a single dollar for something that is already up and
running in the private sector?
Secretary Perry. Senator, I'll see if I can get this as,
you know, as simplistic as I can because for my purposes it is
relatively straightforward. The company I think that you make
reference to--and this is in your home state?
Senator Heinrich. Centrix--Urenco is in New Mexico.
Secretary Perry. Right.
Senator Heinrich. I think Centrix is----
Secretary Perry. That company is not a United States-owned
company and that is the real key here. We need a domestic
supply of this high-assay uranium product if we're going to
have a fuel for advanced reactors. And I think, I hope, all of
us are very much in favor of having these advanced reactors.
Senator Heinrich. Why would you have that require--
commercial reactors don't require that requirement. We----
Secretary Perry. Senator, I'm just telling you that's----
Senator Heinrich. They are already supplying reactors all
over the United States. How is it different if you have a small
modular reactor, a pebble bed reactor? How is that different
than all of the other second generation, nuclear generation
technology?
Secretary Perry. Yes, sir.
And it has to do with the Department of Defense requirement
into restore that market. So, you know, I think there's a clear
understanding when you're talking about something as sensitive
as a DoD-related type of a reactor that you want that to be----
Senator Heinrich. Are we talking about DoD reactors or are
we talking about private sector, next generation reactors?
Secretary Perry. I'm talking about what they're doing with
the advanced reactors may have a clear DoD nexus.
Senator Heinrich. What does that look like?
Secretary Perry. I'm not sure we can----
Senator Heinrich. But it's clear?
Secretary Perry. I don't know whether we can talk about it
here.
Senator Heinrich. That is convenient.
Alright, let's switch gears.
Secretary Perry. I would invite you to come to sit down in
one of our secure skiffs and have the conversation about DoD's
requirement on the bills.
Senator Heinrich. I would be happy to do that.
You were at CERAWeek in Houston and you said that you had
thrown a lot of jello at the wall trying to find some way to
subsidize aging uneconomical coal generation. You had a study.
You proposed it for a quarter and an emergency declaration, all
of those have, sort of, gone by the wayside now. Are we done
trying to prop up generation that is no longer economical in
the current wholesale market?
Secretary Perry. Well, here's what I would tell you,
Senator.
If, you know, if the American people want to have one or
two sources of energy that that's what they're going to rely
upon and, you know, we have been blessed to have----
Senator Heinrich. It seems like we have more sources and
higher reliability than we ever had in our nation's history. So
isn't this a little bit of a solution in search of a problem?
Secretary Perry. No, sir. What it is, I think, is it's
what's called leadership. It's about having a plan in place in
case there are some things that happen. You know, we can have
the defense of this country on the cheap if you want it.
Senator Heinrich. I would suggest it is not about
leadership; that it is about picking winners and losers.
Secretary Perry. I mean, best I can tell, government picks
winners and losers every day, sir. We certainly did in the
State of Texas.
Senator Heinrich. But we have a wholesale market that can
do that based on the private sector.
Secretary Perry. Yes, sir.
And when the lights go out in Dallas, Texas, because you
haven't put the right mix in, I know who gets blamed for that
and it's the leadership of your state, it's the leadership of
your country. And I think that's the point that the President
is making is that we need an all-of-the-above energy strategy
in this country.
You bet, we have--we are blessed with natural gas right now
and we love it, the State of Texas in particular likes that.
But when you are blocking natural gas pipelines going to the
Northeast, when you are literally limiting in Westchester
County, New York, new gas hookups, because of the limitations
that states are making on that type, maybe it's time for us to
have a conversation in this country. Do we need to have a
stable baseload of energy? And those are things that are
uninterruptible. And the best I can tell, the only things that
are uninterruptible in the energy industry are coal and nuclear
and hydro.
Senator Heinrich. I will leave you with one last thing.
There are many coal-fired generating stations operating
well below 40 percent capacity factors. That doesn't sound like
baseload to me.
The Chairman. Let's go to Senator Barrasso.
Senator Barrasso. Thank you, Madam Chairman.
Mr. Secretary, great to be with you again. You and I have
discussed in the past, and I will bring up again today, my
opposition to the Department's practice in the past of
bartering excess uranium to fund the cleanup and
decommissioning of the Portsmouth Gaseous Diffusion Plant.
GAO has repeatedly said that the barters are illegal. The
barters have also contributed to record low uranium prices and
put uranium producers in Wyoming and other states out of work.
In 2018 U.S. uranium production was at its lowest level in
the United States since 1950. Now last year I received your
commitment to suspend the Department's uranium barter because
the Department's practices were illegal and harmful to our
domestic uranium producers.
So I just ask, Mr. Secretary, can you again commit to
suspending the Department's uranium barters and agree to
working with Congress to fully fund the Portsmouth cleanup cost
with Congressional appropriations?
Secretary Perry. Senator Barrasso, I agree with you that, I
think I've used the term, it's a pretty poor way to run a
railroad and I still agree that the Congress needs to directly
appropriate the money for Portsmouth and get out of the barter
business.
Senator Barrasso. The uranium plays such a vital role in
maintaining America's national security. It powers nearly a
quarter of the U.S. Navy's fleet. It keeps the lights on in
around 20 percent of American homes and businesses.
State-owned and state-subsidized uranium producers though
in Russia, in Kazakhstan, in Uzbekistan, they are using unfair
trade practices to flood the U.S. with uranium to the detriment
of producers in Wyoming and across the country.
Based on industry projections for 2019, American uranium
producers estimate that they will supply less than one percent
of American nuclear fuel. If this trend continues, we are
likely to find ourselves wholly reliant on foreign suppliers of
this critical element.
Last July the Department of Commerce launched a Section 232
investigation into whether uranium imports threatened to impair
U.S. national security. The investigation is wrapping up and
Secretary Ross will soon be delivering the findings of that
investigation to the President.
So then, I ask you, Mr. Secretary, do you believe that
maintaining uranium production in the U.S. is critical to our
national security?
Secretary Perry. Yes, sir, is the point I was making to
Senator Heinrich.
Senator Barrasso. And have you and your staff urged the
Department of Commerce to take meaningful action to address
Russia and Kazakhstan's unfair trade practices?
Secretary Perry. We tried. We tried to relay to all of the
agencies of government, remind them of the key role that the
nuclear energy industry continues to play in our country as
well as the key challenges that we have.
It is a very vital sector and whether it's the
infrastructure of the nuclear energy side of things, the market
valuation perspective that occurs and keeping that as a stable
and viable entity is important in a number of areas, it's not
just on the civil nuclear side, sir, but it's also on our
ability to keep a trained workforce and a supply line on our
ability to keep this country free with our nuclear enterprise.
Senator Barrasso. Well, as we are here discussing this,
upstairs I am chairing a hearing of the Environment and Public
Works Committee where we are visiting with the Nuclear
Regulatory Commission, all five members, and the issue that you
just raised about the importance of a stable workforce is key
to our agenda that we are discussing as well upstairs.
Secretary Perry. Thank you, sir.
Senator Barrasso. Do you know if you or anyone on your
staff has had a chance to specifically speak with the
Department of Commerce with regard to our concerns with the
Section 232 investigations and where they are coming?
Secretary Perry. Yes, sir, we have in the appropriate ways.
Senator Barrasso. Thank you very much.
You know, emerging technologies such as carbon capture,
using that carbon, storing it, using it productively, these
have all been potential--we have to reduce emissions while
allowing for the use of the affordable, abundant sources of
energy such as coal.
If we can commercialize these technologies, we can protect
the environment. We can ensure that coal plants remain in
service and competitive in energy markets.
A recent report noted the increase in the construction of
coal generation facilities in China. Last year, Chinese coal-
fired power plant capacity under construction, just under
construction, increased 12 percent.
It is important that we develop and deploy effective carbon
capture technologies for use by growing economies. I appreciate
your Department's support of carbon capture, utilization, and
sequestration technologies.
Mr. Secretary, can I count on your continued support of the
development and deployment of these carbon capture,
utilization, and sequestration technologies in the next fiscal
year?
Secretary Perry. Yes, sir, Senator.
Prior to you coming in we talked about some of the projects
that we're funding now. There was a full $30 million that's
gone out to Carbon Storage Assurance Facility Enterprise, and
then there was another $30 million on front-end engineering
design (FEED) of carbon capture systems. So not only do you
have that commitment, we're sending dollars out the door to do
that as well.
Senator Barrasso. Thank you, Mr. Secretary.
Thanks, Madam Chairman.
The Chairman. Thank you, Senator Barrasso.
Senator Manchin.
Senator Manchin. I am going to take a shot myself this
time.
The Chairman. Alright.
Senator Manchin. First of all, I want to thank you,
Secretary, for being here as always and being candid where you
are coming from and how we can work with you.
Dr. Birol, Executive Director of the International Energy
Agency, basically talked about carbon capture and
sequestration.
Everyone has a different opinion on fossil, whether we
should have it or not have it. The reality of what we are
dealing with in the world is that it is going to be used for
quite some time because of the age of the plants. They are not
going to time the plants out in Asia any time soon.
We are decreasing our dependency on fossil. We see that,
except we are increasing our demand for natural gas.
My State of West Virginia, like your State of Texas, has an
ocean of energy under us, so we are blessed both ways. But with
that, carbon capture and sequestration, something he said, ``If
you want to decarbonize, if you want to really help the planet,
if you want to help global climate, you better find a way to
capture carbon.'' So we are looking at a moonshot type of
mentality. What type of a cost is that? We have people putting
different types of costs. We have some people wanting to talk
about using a carbon fee, and that is going to fix the problem.
A carbon fee that goes to dividends, it is the first out among
the populous, and does not fix the carbon problem.
If you care about the climate and you want to fix it, you
better find out how. Just eliminating fossil is not going to
work around the world.
And he has told us that basically if we eliminate it, the
use of fossil for energy in the United States of America, it is
going to make a blip on the radar screen compared to what Asia
is doing for the next 30, 40 years. So we have to come to that
reality.
What would it take and are you committed? Do you have the
same feeling of that? Have you all talked to Dr. Birol, what is
going on in the demand for energy, because the 2.3 percent
increase has all been just about fossil. It has been an
increase of demand of energy and meeting that demand has been
through fossil more than anything else in other parts of the
world, which is where most of the demand is coming from.
Secretary Perry. Senator, we, at the Department, we agree
by and large with your assessment that I think by 2040, 70
percent of the energy developed in the world will still come
from fossil fuels.
America has always been the place where innovation has come
from, and unless we kneecap ourselves and by taking our ability
to create the wealth that pays for the innovation, you know,
American innovation will continue to be where people look,
where we take and push out our ideas.
When we're working with our Indian friends--I was in India
last year, and we talked to them about our technology going
over there, both CCUS, LNG, all of those, the project that we
went and looked at in Morgantown, right outside of Morgantown,
West Virginia, on the----
Senator Manchin. Yes--coal-fired plant that was basically,
that was using extreme heat.
Secretary Perry. ----HELE plant there, the low emission,
highly efficient, low emission plant there, pulverizing the
coal and incredibly clean technology. That's what the world
needs to see. We need to be able to deliver that type of
technology and, you know, there may be some projects going on
in different places around the world. I don't see it.
As Germany is transitioning away from, you know, both
nuclear power and shutting down coal plants, that was their
goal. They've actually increased their emissions. While the
United States is lowering their emissions, and we're lowering
our emissions partly because of innovation, partly because of
our transition to LNG, so.
Senator Manchin. I am going to----
Secretary Perry. That's--we can help the world get there
but if we put ourselves at a competitive disadvantage----
Senator Manchin. Yes.
Secretary Perry. ----from an economic standpoint, we'll
never be able to----
Senator Manchin. Well, my thing is that, basically, if you
really want to fix the problem, the way we did with the Clean
Air Act back in the '80s and '90s, we made the people that were
emitting the particulates responsible for cleaning it up and
fixing the new technology. I think it is going to take the same
thing here.
For every $1 of a carbon fee that has been recommended,
that would produce $5 billion in revenue. They are saying a $40
fee is $200 billion, so that is $5 billion.
I don't know what it is going to take for a moonshot to get
people to act sooner than later, but we have got to do
something that fixes the problem, not basically exacerbates the
problem because you're turning your head.
Real quick, you and I talked about a Category 5 hurricane
coming up the Houston channel, and what it could do to
devastate our energy production for the United States of
America because most of it is in that corridor. You and I have
also talked, Mr. Secretary, about potential for having
diversification in the mid-Atlantic region where we have an
abundance of propane and ethane. We have an abundance of
natural gas coming from Marcellus and Utica. Rogersville is
going to come on strong.
What I would say is, to ensure that we have resiliency and
redundancy built into our natural gas liquid sector in the
event the Gulf Coast would get hit, are you all looking at that
seriously advancing that as quickly as we possibly can to have
that back up for security? And how does it play into the
national security of our country?
Secretary Perry. Senator, you and I have talked about this
at length and, frankly, it's not happening as fast as I'd like
to see it.
Senator Manchin. No.
Secretary Perry. Because I think there's extraordinary
potential in those four states and the Appalachian region--
Pennsylvania, West Virginia, Kentucky, Ohio--sitting on top of
the Utica and on top of the Marcellus. I mean, just amazing
resources there.
Senator Manchin. We have a deeper one too. We have
Rogersville we just found.
Secretary Perry. And I think it's Shell is building a big
cracker plant just north of you. PTT has a plant that is still
waiting on their final investment decision to be made, but I
think that's going to happen, so----
Senator Manchin. We are talking about the storage hub, you
know, because we've got to keep that wet product.
Secretary Perry. Yes, sir.
Senator Manchin. And we have other countries coming at us
so strong and so hard----
Secretary Perry. Yes.
Senator Manchin. ----speaking of Russia and China, that
wants to buy every, every ounce----
Secretary Perry. Yeah.
Senator Manchin. ----of ethane and propane, take the wet
properties out of the jurisdiction of the United States----
Secretary Perry. And adding value to that gas, the jobs
that get created, and great point you make about having a
duplication of the petrochemical footprint in this country----
Senator Manchin. Right.
Secretary Perry. ----in case there is a Category 5
hurricane up the Houston ship channel and it knocks that out
for some period of time, you have an alternative there.
This is a win-win for America. This is about American
energy security. It's about American jobs. And you know, I hope
we, collectively, the Administration, Congress, Democrats,
Republicans, both look at this and go, this makes sense for
America. It's the type of infrastructure we need to build.
Senator Manchin. We need your help, sir.
Thank you.
The Chairman. Thank you, Senator Manchin.
Senator Daines.
Senator Daines. Thank you, Madam Chair.
Secretary Perry, good to have you here. I want to thank you
for your commonsense, balanced approach as we think about
America's energy portfolio going forward.
I want to look at the budget for the Fossil Energy Research
and Development. Your budget calls for 24 percent reduction in
that budget.
This office had funded a groundbreaking--the Petra Nova
plant in your home State of Texas. I want to complement Texas,
by the way, on being a great example of an all-of-the-above
energy state and what you do there and did as Governor in
Texas.
More recently, Congress has previously funded this office
in a significant way, and I hope we can do that again. I also
want to make sure that money is spent where it is needed most.
As we have spoken before, Mr. Secretary, the Colstrip power
plant in Montana is one of the largest coal-fired plants west
of the Mississippi. It is one of the largest economic drivers
in Montana, and it is very well-suited for DOE investment. Over
2,000 megawatts of power, 350 highly paid workers there, annual
payroll $52 million, $104 million paid in state and local
taxes. I can tell you that is a big number as we look at the
revenue streams in the State of Montana.
We noticed this winter that we had a really cold February
and an unusually cold March. It was 40 below one morning. It
was a Monday morning in March, and I was trying to fly back to
Washington, DC, out of Bozeman. Deicing fluid doesn't work when
it gets to 25 below or colder. We were sitting for two and a
half hours waiting for the temperature to warm up to minus 25.
It was interesting to see what happened on the grid in
Montana when we were hitting this cold snap. I can tell you
without certainty if we did not have the Colstrip power plant
running then because the wind power had stopped at minus 23
because of issues with the composites and structural
challenges. They shut them down at minus 23 or colder. It was
the coal-fired plants that kept the lights on for Montana
during that cold snap.
The challenge, if we lose Colstrip, it is baseload power,
we risk hard-working jobs that boilermakers have, miners, other
laborers, who call our beautiful state home.
And Mr. Secretary, we are a state that still relies on
hard-working Montanans where moms and dads, grandmas and
grandpas can go down to Walmart and buy an elk tag over the
counter for $20.
Secretary Perry. Yeah.
Senator Daines. The youth tag is $8 if you are 12 to 14
years old, because it is something that all Montanans love to
do or most Montanans do. We want to preserve that so it is not
just the rich and famous that are locking up our state to a
balanced approach to natural resources.
Forty percent of that power flows to Washington State, and
Governor Inslee continues to put politics between high paying
jobs in my state, high paying jobs on the Indian reservations,
and affordable baseload electricity. He is pressuring owners to
get away from carrying coal-fired electricity as if electrons
knew the difference.
While I realize it is Texans are using power from Petra
Nova, Colstrip is still very similar. That plant received over
$190 million from DOE. Like Petra Nova, Colstrip is located
near an EOR field that will require pipeline construction for
carbon capture to help offset the economic costs of CCUS. And
while we are making strides improving the economics of carbon
capture, like the Section 45Q tax credit, I believe the future
of this plant demands more investment from your Department.
With that as background, I would like to get your thoughts
on what you are doing to protect coal plants like Colstrip. It
is baseload. It is jobs. It is tax revenue. It is the franchise
for Montana right now, Mr. Secretary.
Secretary Perry. Let me just briefly say that the 2020
budget that is laid out in front of you is not at a level that
would support a commercial scale operation for Colstrip that's,
as you mentioned, similar to Petra Nova. And Petra Nova had
received $190 million in stimulus funding from DOE and that was
a $1 billion project which means the partners provided about an
80 percent cost share.
But we recently released an FOA for carbon capture at power
plants. It's $30 million for FY'19, and that was directed by
Congress and certainly could be of interest.
It's the Administration's policy for us to be, DOE, to be
focused on these early stage research and development
opportunities, particularly where there's the potential for
them to be commercialized and the technology to be
demonstrated.
So I think you know our commitment to the technology. I
think, more importantly in a broader--just let me say as I wrap
up here quickly, you're absolutely correct that we've got to
have a portfolio that is broad in this country, that if we just
make decisions about the economics, you know, there are cheaper
ways to deliver energy in the country. Right now, we're blessed
with an abundance of natural gas and God, I mean, thank God
we've got that. But you never want to have that phone call that
comes in and says, you know, we got people that are losing
their lives in part of the state because we weren't willing to
pay for a diversity to make sure that we had an all-of-the-
above energy strategy.
It would be like saying that we're going to keep America
free but we don't need x numbers of hundreds of thousands of
soldiers, we can do it on with this many, we really don't need
a--let's just have a 100 ship Navy because, you know, that's
cheaper and we can use these dollars for something else. You
can keep America free for some period of time on the cheap, but
I'm not willing to bet the future of this country on it. And I
hope that the people of this country aren't willing to
basically say, we're going to have an energy strategy, a
national security strategy, in this country that's just based
on cost.
Senator Daines. Thank you.
My follow just is, can I get your commitment to work with
me on ways to accelerate the DOE investment at Colstrip?
Secretary Perry. Yes, sir.
Senator Daines. Thank you.
The Chairman. Thank you, Senator Daines.
Senator Cortez Masto.
Senator Cortez Masto. Thank you.
Hello, Secretary Perry, I guess you know what I am going to
talk to you about.
Let me ask you this. In the President's budget, you request
$116 million to restart licensing activities for the proposed
Yucca Mountain Nuclear Waste Repository, which would ultimately
bring high level nuclear waste to Nevada.
Secretary Perry. Okay.
Senator Cortez Masto. Do you want me to give you some time
to get to----
Secretary Perry. No, no, no, I'm set now. I'm ready.
Senator Cortez Masto. Okay.
And so, as you know, this is something that, for purposes
of the State of Nevada, we have been fighting against. We are
united from Republican and Democratic governors to our
Congressional delegation. It is not safe for the storage in
Nevada. And the concern we all have is the end run around the
science.
So let me ask you this, because I think it is still
happening.
On March 21st, 2019, the Defense Nuclear Facilities Safety
Board sent you a report saying they are concerned that the
Department of Energy has not adequately addressed the seismic
hazards for the Device Assembly Facility (DAF) at the Nevada
National Security Site (NNSS) and that a seismically induced,
high explosive, violent reaction could result in unmitigated
dose consequences to the offsite public. Predominately, the
report states that DOE has not evaluated the impact of the
increased seismic hazard on safety-related structures credited
to protect public health and safety during a seismic event at
the Nevada National Security Site. In fact, the most recent
U.S. Geological Survey taken in this area lists the region to
be a moderate to high seismic hazard.
So my question to you is, have you taken these seismic
hazard reports into consideration as you continue to push to
open Yucca Mountain?
Secretary Perry. Let me respond to your first observation
which is the letter that you make reference to, and we
certainly appreciate their input related to the need to update
the seismic analyst, analysis rather, for the systems and the
equipment that supports nuclear explosive operations at the
Device Assembly Facility.
Senator Cortez Masto. You have incorporated some analysis
into this new seismic activity report that is coming in? We
have it every single day coming into the University of Nevada
Reno to show that there is moderate to high seismic activity
there. Are you incorporating that into your analysis for
reopening Yucca Mountain?
Secretary Perry. I feel quite certain that we would,
Senator.
Senator Cortez Masto. That you would or you have not yet?
Secretary Perry. That we would.
Senator Cortez Masto. Okay.
Secretary Perry. Yeah.
Senator Cortez Masto. So what I would like to know is
specifically what you are incorporating into your analysis? If
you can share that with me, that would be helpful.
The next question I have for you is, you may not know this
but a handful of red flag exercises are held at Nellis Air
Force Base, which is over at the Nevada Test and Training
Range, in close proximity to Yucca Mountain. The purpose is to
give our service members realistic training with real hardware
and ammunition. Even former Air Force Secretary Heather Wilson
has stated that, ``transportation of nuclear waste near the
range could impact testing and training.''
Do you think it is safe to store waste nearby, even with
the threat that errant ordinance or any other mishap near Yucca
Mountain could have an extremely negative impact on the
neighboring public?
Secretary Perry. I think it's safe, Senator. As a matter of
fact, what I'd like to do is----
Senator Cortez Masto. So can I see your analysis, instead
of your opinion.
Secretary Perry. ----invite you to come out.
Senator Cortez Masto. I have been there. I have been there,
sir.
Secretary Perry. You've been to the DAF?
Senator Cortez Masto. I have been there. And let me just
say this, I would like to see your analysis as to why you think
this is safe when the Secretary of the Air Force does not.
And so, not only have I been there for the red flag
exercises, I have been to Yucca Mountain. I have been to those
facilities.
Secretary Perry. But you've been to the device----
Senator Cortez Masto. So I would like to see some analysis.
Secretary Perry. ----because what we're talking about here
is the, just so we're clear about what we're talking about
because the Nevada site is a massively big piece of land.
Senator Cortez Masto. Secretary Perry, I don't have much
time, but you don't have to tell me that. I grew up in Las
Vegas. I have family and friends who work out there. I have
been out there.
Secretary Perry. But I'm asking you, Senator, have you been
to the DAF?
Senator Cortez Masto. So I would like to sit down and go
through this with you and show you why it is not safe and there
are concerns about the safety there.
I am running out of time.
Let me ask you this. On October 20th, 2018, President Trump
said to a Reno news station, regarding Yucca Mountain, and I
quote, ``I think you should do things where people want them to
happen. So I would be very inclined to be against it.'' That
would be Yucca Mountain and opening it. ``And we will be
looking at it very seriously over the next few weeks. And I
agree with the people of Nevada who do not want Yucca Mountain
to be a long-term, permanent repository.'' So my question to
you is, does President Trump no longer agree with the people of
Nevada when he expressed his opposition to Yucca Mountain?
Secretary Perry. Senator, what I think we all have to
recognize here is that Yucca Mountain is the law. And I'm going
to follow the law. I think the President is going to follow the
law. His opinion of whether or not the people of Nevada like it
or not doesn't have anything to do with what the statute says.
And the statute says that we are to continue with the licensing
process for the Nuclear Regulatory Commission to make the
decision on whether or not this is a safe site or not. It's not
an issue of what someone thinks or what someone necessarily
desires. I'm going to follow the law.
Senator Cortez Masto. So let me ask you this, Secretary
Perry, because I hear you say that constantly. I hear you say
that constantly even though the previous Administration took a
different path toward that in the Blue Ribbon Panel which has
been disregarded by this Administration.
But let me just follow up with this because you say this
constantly. ``You're just following the law.'' And I just want
to take a moment with respect to this issue.
The Chairman. Very briefly please.
Senator Cortez Masto. Thank you.
I think it is important for people to know that this law
was not born out of rational decision-making. It was
intentionally created to do an end run around the science,
compromise public participation, and was created intentionally
to disregard Nevada at the expense of other states.
And just very briefly, in 1982 the Nuclear Waste Policy Act
directed DOE to study many sites to ultimately construct two
repositories, the first one in the West and then one in the
East. It limited the amount of waste the western repository
would keep to ensure that the western location would not be the
sole facility. By 1990, a second repository site was to be
named amongst a short list of five other identified locations;
however, DOE's list of sites for the second repository drew
intense opposition from all of the affected states. And in
1986, the Reagan Administration announced a halt to work on a
second repository.
When confronted with intense political pressure and high
cost, Congress passed the NWPA amendment in 1987, which not
only canceled the second repository program, it nullified the
creation of a temporary storage facility that was supposed to
be placed in Tennessee until after the licensing of the final
repository and it statutorily designated Yucca Mountain as the
site. Mr. Secretary, this historical context is key and it
shows that extreme political influence was used to scapegoat
the State of Nevada.
All I am asking is for some reasonable people to come to
the table to address this issue and recognize that,
scientifically, this is not safe for Nevada. We need a consent-
based siting----
The Chairman. Senator----
Senator Cortez Masto. ----for everyone to be involved and
not use Nevada as a scapegoat.
Thank you.
The Chairman. Thank you.
Senator Cortez Masto. I appreciate the indulgence.
The Chairman. I am very generous with my time.
Let's go ahead to Senator Wyden.
Secretary Perry. Senator, let me just wrap it up by saying
that I hope you and I make the parameter for reasonable people,
and I will work with you in any way that I can. And again, I
want to offer you the opportunity to come out to the NNSS with
me and let's continue the conversation and put boots on the
ground at the site.
Senator Wyden. Thank you, Madam Chair.
Mr. Secretary, I want to ask you about two matters,
primarily Bonneville, but just a quick matter on Hanford, where
Senator Cantwell is going to zero in and is very knowledgeable
in this area.
You all are up to two things at Hanford. The first is you
are looking at taking the high-level radioactive waste, which
is the worst stuff, and calling it something less hazardous.
And so, there is this, kind of, a name change. And you are
adding budget cuts to it. So we have two bad things going on up
there.
Senator Cantwell, as I said, will get into all the details,
but I would just like to ask for purpose of my first point, not
a question, but I would like you to provide the Committee,
particularly Senator Cantwell and myself, an explanation of how
the types of budget cuts you are proposing, in addition to the
reclassification operation, are going to let you achieve the
milestones of the tri-party agreement. This is just yes or no.
Will you get me an answer within ten days on that?
Secretary Perry. Yes, sir.
Senator Wyden. Thank you.
Second, I want to get into Bonneville. So you all want a
privatized Bonneville. And on this matter, Secretary, I want to
give you an opportunity for some candor.
You and I have had plenty of differences, but I have always
found you to be candid when I have asked you about these kinds
of issues. And a little bit ago, one of your Office of
Management and Budget people who handles energy issues said
that the Trump Administration is still going to propose
auctioning off Bonneville to the highest bidder.
Now this steals from every man, woman and child in the
Pacific Northwest, our ratepayers, and is particularly bad for
the rural areas. In other words, Senator Cantwell in Seattle
and myself in Portland. The cities have a lot of, you know,
opportunities, but these rural areas are just going to be
hammered. And privatizing Bonneville would just amount to
garden variety robbery for families in the Northwest,
particularly the ones walking on an economic tightrope,
balancing the food bill and the fuel bill and the fuel bill
against the rent bill. They are already stretched very, very
thin without the Administration trying to raise their monthly
utility bills.
I would like to give you an opportunity for that kind of
Perry candor that we have been able to achieve a little bit
from time to time in the office and give you the chance to take
this colossally bad idea off the table this morning,
privatizing Bonneville. Because I would just like to walk out
of here and say, you know, something meaningful has been
achieved this morning for the people that I have the honor to
represent in the United States Senate, particularly in the
rural areas.
I am heading home for the break, going to have Town Hall
meetings in these rural areas.
Mr. Secretary, privatizing Bonneville hits everybody in the
Northwest, steals from the families, but for the rural areas it
hits them like a wrecking ball. It just clobbers them.
So can we, for purposes of this morning, can we take this
colossally bad idea to privatize Bonneville off the table with
a little bit of Perry candor, and have you tell us we don't
have to have people all up in arms in those rural communities I
am going to be visiting here shortly?
Secretary Perry. I will be as candid as I can, Senator, and
I'll try to replicate my answer from previous questions on this
and my past visits to the Hill. My position, relative to having
been an appropriator, having been a chief executive and how
these, this budget process works is still the same. I will
suggest to you that this line item will end up like it's ended
up in every previous Congressional----
Senator Wyden. Freeze-frame with that right now. And you
are fine with it ending up on the cutting room floor?
Secretary Perry. Senator, I know how this process works and
the budget process is going to be decided by those of you
sitting on that side of the dais. I'm sitting on this side. I'm
going to do what you tell me to do. You'll make the decision on
whether or not. I'm sure there are a number of places on our
budget that you and I may not agree 100 percent or even 50
percent, but you're going to make that decision about where the
appropriations are going to be.
I'm going to----
Senator Wyden. I am over my time.
We are going to make sure it ends up on the cutting room
floor, and I just hope you won't be trying to revive it after
we do.
Thank you, Madam Chair.
The Chairman. Thank you, Senator Wyden.
Senator King.
Senator King. Thank you, Madam Chairman.
Governor, Secretary, you have a very tough job coming into
a hearing like this defending a budget that I think has some
real problems.
I think, first, and this goes to Senator Wyden's question
and you have answered this several times, but I just want to
have it absolutely clear. Will you commit to diligently and
responsibly administering the budget that is passed for your
Department by Congress?
Secretary Perry. Yes, sir.
And I hope that the activities and our work that we've done
together is a pretty good reflection of that over the last two
years.
Senator King. Well, I actually checked on that and my
impression is that that is the case, that you have pursued and
funded those programs that were authorized and appropriated by
Congress, even though they were not in the original budget. And
I take it your commitment is that you will continue that
policy.
Secretary Perry. I respect this process, sir.
Senator King. Thank you.
Now there are some good things in the budget, and I think
there are some things that should be recognized. One is an
initiative on energy storage. This is one of the most important
energy issues that faces this country. I am a little concerned
I don't have much detail, but I hope that you can supply,
perhaps for the record, a little more background about what
that intention is and what the funding level will be, because I
think that is a very important initiative.
The CESER Office is a good initiative. I understand that is
going to have an increase, the cyber office. I think that is
important.
Senator Manchin talked about carbon capture. I think that
is important.
My concern though is, and I think you understand this,
basically you have said a couple of things today that indicate
that you do. When we cut R&D, when we cut the kind of basic
research that really only the Department of Energy can do
because it is too early stage for the private sector, we are
really hurting this country's future.
I wrote down a couple things you said. Pretty positive
stories due to innovations coming out of Department of Energy
programs. Yes. So let's not cut the programs that have created
those positive stories. The other thing you said is, ``America
has always been the place where innovation comes from.''
And as you well know, the fracking revolution, which is one
of the great energy innovations of our lifetimes, came out of,
in part, funding from the Department of Energy research and
development fund.
I understand that you are constrained by the budget that
the Administration wants to submit, but please don't diminish
your commitment to those R&D programs. That is where the future
of this country hangs in the balance. And I think I understand
the new initiatives, and I think they are important, but that
R&D is important. And I am sure you recognize that.
Secretary Perry. Yes, sir. We do.
And all the way back to, again, my days as a chief
executive in Texas creating offices that did just that.
One of the things that we've done here, recognizing that we
have, you know, parameters in the budget that we have, is to be
able to do some crosscutting work, if you will, creating a
Chief Commercialization Office at the Department to be able to
oversee these projects, a technology transfer side of this too.
And in my remarks, Senator, I talked about that, you know,
I hope I don't get judged, I hope the agency doesn't get judged
just on the amount of money that we spend on a line item, but
on the results that we get from that.
So, and I know, listen, I'm not Pollyanna here. I
understand your concerns about particular line items and the
reductions that are there, but I hope that you see in our
performance from the last two years whether it's on the
renewable side of things which folks, you know, were concerned
about are you going be funding these types of programs, that
you're seeing those types of efforts, that you're seeing the
commitment to an all-of-the-above energy strategy whether it's
CCUS, whether it's wind, whether it's----
Senator King. Well, my problem isn't--you can make
adjustments and you are talking about adjustments, but in the
Office of Energy Efficiency and Renewable Energy, essentially
there is an 85 percent cut. That is not a trim. When I put my
rat in your trap, I expect him to lose his tail but not up
behind his ears.
Secretary Perry. Yeah.
Senator King. And that kind of cut is, that just, it
doesn't bear out. So that is the area that I hope we can work
at.
Budgets are policy, and essentially one of the things this
budget says is we are not really interested in R&D and the
future of those investments, except in certain areas.
So I hope, again, to go back to the very beginning, that
you will be diligent and fully responsive to the mandates of
this Congress in terms of what----
Secretary Perry. Yes, sir.
Senator King. ----what the programs are, how they will be
funded and how they should be administered.
Secretary Perry. We will, Senator.
Senator King. Thank you.
Thank you, Madam Chair.
The Chairman. Thank you, Senator King.
Senator Cantwell.
Senator Cantwell. Thank you, Madam Chair.
Secretary Perry, this----
Secretary Perry. Ready to go.
Senator Cantwell. I am letting you get to your tab there.
Secretary Perry. I'm there. I'm on you.
Senator Cantwell. Well, this hearing is interesting this
morning because, obviously, you are responding to this overall
budget and many of my colleagues have different viewpoints on
the President's proposed budget. You, as a skillful ex-
Governor, now Secretary of Energy, are coming here and
basically telling us don't worry. I get it, like you guys are
going to write a budget and you are going to have your day.
I guess the challenge with all of that is that I think we
live in a new world where getting consensus is the best way to
move forward. I didn't coin that, somebody else did. Basically,
in an economy where there is so much innovation and
information, those people move ahead when they get around a
table and get consensus around that science and information.
The reason why I am asking you that is because when the
people out at Hanford did the budget and said this is what it
takes to comply with the tri-party agreement, they came up with
numbers that now the Administration is ignoring.
And so I am just trying to understand, if we are going to
move forward on science and information, how can we have our
own people out at Hanford come up with a number--I think the
River Protection Compliance Budget was $1.8 billion--and the
President's budget proposal only has $1.4 billion? The Richland
Office Compliance Budget was $1.3 billion and the President's
budget came up with $708 million. So the people on the ground
who are working for you are putting numbers on the table and
then the Administration or someone is making a decision that is
different than that. And these are the people who have to meet
the milestones of compliance.
Now I know you have heard me say many times here, and I
truly believe it, I am ready for an energy secretary for life
or until Hanford is cleaned up.
Secretary Perry. Yeah.
Senator Cantwell. Why? Because I think every single energy
secretary gets in your slot, they basically have to deal with
the White House and they look at the Hanford budget and they
think, oh, my gosh, it's in the billions of dollars. We can't
possibly do that. I can come up with a better way, and I can
figure out how to get it done. And I guarantee you, every one
of those energy secretaries and White Houses have been thwarted
on that.
Why? Because it is the largest cleanup site in the entire
world, and the complexity is off the charts. But that is what
it is going to take to live up to our responsibility, having
people scrub the numbers in the local community and submit
them.
And so I am just asking kind of the same question a lot of
my colleagues are asking, how do we get around a table and get
consensus on numbers that we all believe in as opposed to this
continued back and forth? And I get it, I get what you are
saying.
Secretary Perry. Yup.
Senator Cantwell. You are skillful at saying it. You are
skillful at saying, yeah, I get it. Congress will end up
writing this budget. But in the meantime, we actually have a
legal document in the tri-party agreement that we have to live
up to and we asked the people in the community, what does it
take to live up to it? And their numbers are very, very
different than what you and the White House are proposing. So I
am just asking, how do we get on the same page here?
Secretary Perry. Yeah.
Senator, you bring up a really interesting point, and by
the way, I am not going to be Secretary of Energy for life. Let
me, kind of, go on the record.
Senator Cantwell. That was a softball. That was a softball.
I let----
Secretary Perry. Here's what really concerns me is that we
went back and the previous Administration, the best I can tell,
didn't give you or this Committee or this Congress or, you
know, the previous seven, eight years' worth of Congresses, the
updated numbers on what Hanford was going to cost. We just got
those for you, and those are stunning numbers. I mean, they
are.
And so my point, Senator, is that and you've got every
right to be really upset that you haven't been given the right
numbers of what's this really going to cost.
Senator Cantwell. I think the local community did. I am
saying that the Administration is----
Secretary Perry. But I'm telling you----
Senator Cantwell. The Administration is now saying they
don't believe that is what it takes to meet compliance. And so,
unlike my colleagues, I am not exactly here with an emphatic
voice. Why? Because I know the voice of experience. I have sat
here with energy secretary after energy secretary, and I do
know the outcome. I know the outcome. And I know that in the
end we will prevail.
We have got to get on the same page because I guarantee you
Hanford is never going to be done on the cheap, never. It is
just not. And it is complex.
Secretary Perry. You're absolutely correct.
Senator Cantwell. And we have to get----
Okay, my time is expired, and I don't want to use
everybody's time.
On the quantum issue, if you could just think about this.
Obviously, the Chinese competition is so great. We, I think,
authorized $1.2 billion. Your budget has money for one center.
We were just out in Seattle with some of your team on a
conference on this, and the one thing that struck me is that if
you want to keep competitive--there are various aspects of
quantum. There is the chemistry side. There is the algorithm
side. There is the material side. I am just saying, I don't
know if we can do our competitive aspect on quantum with just
one Center of Excellence. I hope, as this Committee envisioned,
we would have many Centers of Excellence, and that DOE would
think about that and go back to what it is going to take for us
to catch up on this issue.
Secretary Perry. I think you're correct, Senator. And let's
spend some time talking about it.
Senator Cantwell. Thank you. Thank you. Thank you.
The Chairman. Thank you, Senator Cantwell.
I know that with the push that we have made here in the
Committee on quantum and the priority that you are making it, I
understand that there is more that is coming out for research
on computing software out of the Department of Energy.
I don't know if you have any updates that you want to share
on that, but know that that is something that we certainly
support.
Secretary Perry. Yeah, we were just at Argonne three weeks
ago basically announcing the computer that will be named
Aurora. And I think I mentioned to the Committee the speed of
that is a billion billion acts per second and gets us, that's
the first exascale computer in, I think, 2021. It comes on
board in 2021.
So the U.S. has the number one fastest at Oak Ridge. Number
two fastest out at Lawrence Livermore and when this computer
comes on board, it will take that number one spot. So with all
of that said, if we think for a moment that the Chinese are
taking a pass here, we are very mistaken.
The Chairman. You are not----
Secretary Perry. We'll need to be spending substantial
amounts of money and watching our technology very closely as
they try to collect it and use it to get back in the lead in
quantum or get the lead exascale in route to quantum computing.
The Chairman. Well, Mr. Secretary, I know you have
repeated, numerous times throughout the course of this
morning's hearing, that you know how this budget process works,
that we on the Committee have a very significant role in
helping further define legislative priorities. Not only on this
Committee, but in the other Committee which several of us serve
on, on Appropriations for Energy and Water and helping to
facilitate that. I do hope that you have heard very clearly
some of the priorities that have been outlined here.
Secretary Perry. Indeed.
The Chairman. Whether it is Senator Cantwell's effort on
the cleanup at Hanford, something that she has repeated year
after year after year, whether it is the need to ensure that
ARPA-E continues to do its good work, the efforts within the
Office of Energy Efficiency and Renewable Energy, there's good
strong support here for that. Support for the national labs.
I have just introduced, along with many on this Committee,
legislation that relates to nuclear and our advanced nuclear
power. This is our NELA bill. We are certainly hoping that
within the Department we will have many of your fine team
helping us as we seek to regain leadership, world, global
leadership when it comes to nuclear technologies and really
that nuclear workforce.
I mentioned in my opening the weatherization and the state
programs again as priorities. Indian energy. Many have
mentioned energy storage, the quantum initiative, the nuclear
waste policy. So I think your folks and you have clearly heard
where some of our priorities are in this area, and know that we
will continue to work with you to help advance that.
Senator Manchin.
Senator Manchin. One quick question, and I know Senator
King has one more too.
I just want to clarify, Mr. Secretary, the budget that we
have in front of us is one that needs to be worked on, as you
know, both Democrats and Republicans have concerns. You have
been great to work with. Your office has been great to work
with. We all acknowledge that. You will continue because right
now the signal being sent from this budget--I think that
Senator King will mention also and Chairman Murkowski has
mentioned--that it gives them a lot of concern, consternation.
Whether it be the, you know, the low-hanging fruit of
energy efficiency. That is a low-hanging fruit. I have had
thousands of homes in West Virginia benefit, and 200 jobs are
associated with it. They think that is going away. I want to
make sure that we reassure them that this is a program and
process in work, and you will continue administering what you
have until you have a direction from Congress on how that
spending will work out in your budget process. So there is no
need for alarm right now. Should we send that signal that all
is well and stable and we are on course?
Secretary Perry. Sir, I would suggest that I hope we are
sending the same signal that we sent a year ago.
Senator Manchin. Yes.
Secretary Perry. That, you know, sometimes you support a
particular line item with a lot more zeal than you do another
one.
Senator Manchin. I got it.
Secretary Perry. But----
The Chairman. That is very politically correct.
Secretary Perry. ----more importantly, we are going to be
open to all the members as they lay out their concerns about
the budget. And at the end of the process we will take your
directions and with as efficient and as responsible way as we
can, to deliver on that, obviously staying within the statutory
requirements of the law.
The Chairman. We appreciate that.
Senator Hoeven, we are just wrapping up, but Senator King,
you wanted to have a final comment and then we will let Senator
Hoeven wrap.
Senator King. Thank you, Madam Chair.
Just a quick suggestion on quantum. I sit on a couple of
other committees dealing with national security. There are lots
of people in the United States Government working on quantum,
like the intelligence agencies and the Defense Department. I
have a suggestion. You might convene a quantum council to be
sure that there is a high level of coordination so we are not
duplicating, because this is expensive and important work.
Secretary Perry. Yes, absolutely.
Senator King. So to the extent you can appoint yourself
Quantum Tsar to bring together the----
Secretary Perry. I appreciate your confidence. There may be
somebody even substantially better to do that, but I'm pretty
good about getting people together.
Senator King. Well, you understand the point.
Secretary Perry. Absolutely.
Senator King. You can perform a convening function.
Secretary Perry. Yup.
Senator King. And I think it is important, because this is
a major initiative of the United States Government----
Secretary Perry. Yes, sir.
Senator King. ----that is taking place, I know, in three or
four or five different places and probably others. I hope you
can look into that.
Secretary Perry. We have three national labs that focus on
that now. But you are absolutely correct----
Senator King. But there are other people, NNSA----
Secretary Perry. NNSA, DoD, DARPA, all the other agencies
of government out there that have----
Senator King. Let's get them in the same room just
occasionally, every quarter, perhaps, to talk about, okay, what
are you doing? What are you doing? So that we are----
Secretary Perry. Good idea, sir.
Senator King. Thank you.
Secretary Perry. We're on it.
Senator King. Thank you, Madam Chair.
Secretary Perry. Thank you.
The Chairman. Senator King, I think the quantum initiative
legislation that we passed has some of what you are talking
about. I don't think it designates a Quantum Tsar, though, so
we will have to go back and take a look at that.
[Laughter.]
Senator Hoeven, we have had a good exchange with the
Secretary here.
Senator Hoeven. Thank you, Madam Chairman. I appreciate it.
Governor, good to see you.
Secretary Perry. Hey, gov.
Senator Hoeven. You are looking well.
Secretary Perry. How's Mikey?
Senator Hoeven. Doing good, doing good.
How is Anita?
Secretary Perry. She's really good, thank you.
Senator Hoeven. Yeah, yeah. Good to see you.
Thanks for all you are doing.
This time of year it starts to get pretty warm in the
Virginia-DC area and it gets pretty hot down in Texas, but a
nice cool place to go this time of year, where they just have
great weather as well as fabulous people is my home State of
North Dakota.
The Chairman. I thought this was another invitation to the
Arctic. I just teed him up for that.
Senator Hoeven. Exactly.
The Chairman. So----
Senator Hoeven. See, I mean, we have a great Chairman, you
know, who thinks the right way about things.
And so, on your way up to Alaska----
[Laughter.]
----you would want to stop in North Dakota and we had you
out there and, of course, you did a great job, saw some of the
things we are doing out there, but we didn't get you over to
Grand Forks to the Energy Environmental Research Center.
Secretary Perry. Yeah.
Senator Hoeven. Which you need to see because they are
doing amazing stuff, and it is something that is near and dear
to what you worked on for a long time and that is carbon
capture and sequestration.
And so, I have worked on the Approps side to make sure that
we have research funding on this carbon capture and
sequestration piece, both for fossil fuels but also on the
renewable side. We have projects going on out there.
Project Tundra where, you know, we are capturing it off the
coal-fired electric plants and we've got, like you down in
Texas, we have the latest technology in the coal field and we
both have lignite coal. But we actually have to start capturing
and sequestering it, and commercial viability is the key which
is why it is not just the company is putting up money, but the
State of North Dakota is putting up money just like the State
of Texas did and DOE. Then we also have ethanol plants that
want to capture CO2 and put it down a hole as well
so they can meet some of the low carbon requirements like on
the West Coast and that kind of thing for renewable fuel.
The first question is, can we get you out there to take a
look at this stuff and anything else you want in oil and gas?
You know, we are up to 1.4 million--we are chasing Texas hard--
we are up to 1.4 million barrels a day now.
Secretary Perry. I talked to Governor Burgum yesterday----
Senator Hoeven. I know he was here.
Secretary Perry. ----about some projects that we can talk
about offline. But I mean just you guys have some amazing
potential there and in an all-of-the-above energy strategy with
taking the associated gas that's actually restricting some of
your crude production now and finding a way to get that sent to
the, you know, the most likely, the West Coast and then you put
your CCUS into that field, you get the associated gas off, you
get the secondary and tertiary push from the emissions off of
that carbon capture. I mean, the energy production in North
Dakota can be stunningly powerful for the United States.
Senator Hoeven. Well, it is an economic win, it is an
environmental win, and it is a national security win.
But we have to get to commercial viability for the carbon
capture. Technologically we can do it, but we have to get these
projects going.
And I want to commend you. You just announced your regional
initiative to accelerate carbon capture at $20 million for that
project. That is something we put in Approps, and now you
announced the criteria so that folks can come forth and start
utilizing it.
Secretary Perry. Yup.
Senator Hoeven. And then the other one is the CarbonSAFE
program, Regional Carbon Sequestration Partnership, RCSP.
So both Project Tundra, which is a group of the latest,
greatest coal-fired electric plants, the State of North Dakota
and University of North Dakota, EERC are working on that. So we
are not coming to you and saying, hey, fund us. We are coming
to you and saying, be our partner.
And then the same thing--we are a microcosm of what the
country sees as a whole where we have to get traditional fossil
fuel energy working with the renewable world together.
These programs are involved, both biofuel and ethanol, as
well as the oil and gas.
It is the kind of thing where if we can get it done, it is
an economic win, it is an environmental win, and it is a
national security win. It is the same thing our country is
doing on a macro level, you know, we are trying to crack that
code. Same thing with hydraulic fracturing. When I started as
Governor, we produced less than 100,000 barrels a day. Now it
is 1.4 million because we cracked the code on hydraulic
fracturing. Same thing in Texas, right?
But we need you out there. We need you, because we have
been talking about carbon capture and storage but we are not
doing it. We are not at commercial viability. When we get
commercial viability, we will have cracked the code, not just
for here, but you know, we will get China.
Secretary Perry. Yup, around the world.
Senator Hoeven. Exactly.
So we need you out there. We need you to help us with
these. We need to help take that next step from the R&D to
commercial viability. And you are the guy, I mean, this is
right in your wheelhouse. So we need your help with it.
Secretary Perry. You just mentioned two projects that we're
working on that funded, one of them we're funding, the other
one we've got a FOA out on it so--on the carbon storage
assurance facility. So I think we're headed in the right
direction.
Senator Hoeven. Yes.
Secretary Perry. And then more importantly, we'll follow
your lead, sir.
Senator Hoeven. And obviously, we have been working with
our Chairman and others, then we have just got to find a way.
Whether you want traditional energy or renewable energy, we
have got to have transportation. We have to have pipelines. We
have to have transmission lines. We have to have LNG
facilities. We have to build that stuff, and it is not just
stronger or better environmentally, it is safer. We are taking,
we are replacing old infrastructure with the latest, greatest,
safest infrastructure. It is a safety issue too.
Secretary Perry. And Madam Chair, I would be remiss if I
didn't remind you that exactly what Senator Hoeven is talking
about and getting a full contingent on FERC. And that, of
course, will come through your Committee.
Thank you for all the work that you've done to get our
members, but I don't think there's anything more important in
light of what you talk about on infrastructure, than get a
fully functioning Federal Energy Regulatory Commission and
getting those permits done and letting Americans get to work
and get this product to the world market.
Senator Hoeven. So, you will come?
Secretary Perry. Yes, sir.
Senator Hoeven. Thank you.
Secretary Perry. Yes, sir.
Senator Hoeven. And thanks for all you are doing, your
leadership.
Secretary Perry. It's still the coolest job I've ever had,
sir----
Senator Hoeven. Well, you are the right guy to do it.
Secretary Perry. ----not the best one----
Senator Hoeven. We appreciate it.
Secretary Perry. ----but the coolest.
[Laughter.]
Senator Hoeven. I know what the best one was.
Secretary Perry. Yeah, I know----
[Laughter.]
----same one you had.
The Chairman. Well, Secretary Perry, thank you.
Thank you for being here. Thank you for, as Senator Wyden
would put it, your Perry candor, which is appreciated.
I understand that sometimes defending the budget at a time
when everybody is looking to make sure that we are making
necessary cuts and sometimes very, very hard cuts, that
sometimes, specific provisions are really hard to defend and
yet, that is your job.
Secretary Perry. Yes, ma'am.
The Chairman. You have been deft this morning, and I
appreciate that.
Secretary Perry. Thank you.
The Chairman. But I fully appreciate, again, your reminder
to us that you know the drill around here and we look forward
to working directly with you, directly with your team to help
accomplish some of the goals and really significant initiatives
where we feel that we can make a difference when it comes to
this new energy reality that we have been blessed with here in
this country.
So thank you----
Secretary Perry. Thank you.
The Chairman. ----for your time and your leadership.
Secretary Perry. Thank you, Madam Chair.
The Chairman. With that, we stand adjourned.
[Whereupon, at 12:08 p.m. the hearing was adjourned.]
APPENDIX MATERIAL SUBMITTED
----------
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]