[House Hearing, 118 Congress]
[From the U.S. Government Publishing Office]



         ENERGIZING THE TERRITORIES: PROMOTING AFFORDABLE AND
          RELIABLE ENERGY SOURCES FOR THE U.S. INSULAR AREAS

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

                           OVERSIGHT HEARING

                               before the

               SUBCOMMITTEE ON INDIAN AND INSULAR AFFAIRS

                                 of the

                     COMMITTEE ON NATURAL RESOURCES
                     U.S. HOUSE OF REPRESENTATIVES

                    ONE HUNDRED EIGHTEENTH CONGRESS

                             SECOND SESSION

                               __________


                        Thursday, April 11, 2024

                               __________


                           Serial No. 118-110

                               __________


       Printed for the use of the Committee on Natural Resources






                 [GRAPHIC NOT AVAILABLE IN TIFF FORMAT]






        Available via the World Wide Web: http://www.govinfo.gov

                                   or

          Committee address: http://naturalresources.house.gov
      

                               ______
                                 

                 U.S. GOVERNMENT PUBLISHING OFFICE

55-382 PDF                WASHINGTON : 2024













                     COMMITTEE ON NATURAL RESOURCES

                     BRUCE WESTERMAN, AR, Chairman
                    DOUG LAMBORN, CO, Vice Chairman
                  RAUL M. GRIJALVA, AZ, Ranking Member

Doug Lamborn, CO		     Grace F. Napolitano, CA
Robert J. Wittman, VA		     Gregorio Kilili Camacho Sablan, 
Tom McClintock, CA		         CNMI
Paul Gosar, AZ			     Jared Huffman, CA
Garret Graves, LA		     Ruben Gallego, AZ
Aumua Amata C. Radewagen, AS	     Joe Neguse, CO
Doug LaMalfa, CA		     Mike Levin, CA
Daniel Webster, FL		     Katie Porter, CA
Jenniffer Gonzalez-Colon, PR	     Teresa Leger Fernandez, NM
Russ Fulcher, ID		     Melanie A. Stansbury, NM
Pete Stauber, MN		     Mary Sattler Peltola, AK
John R. Curtis, UT		     Alexandria Ocasio-Cortez, NY
Tom Tiffany, WI			     Kevin Mullin, CA
Jerry Carl, AL			     Val T. Hoyle, OR
Matt Rosendale, MT		     Sydney Kamlager-Dove, CA
Lauren Boebert, CO		     Seth Magaziner, RI
Cliff Bentz, OR			     Nydia M. Velazquez, NY
Jen Kiggans, VA			     Ed Case, HI
Jim Moylan, GU			     Debbie Dingell, MI
Wesley P. Hunt, TX		     Susie Lee, NV
Mike Collins, GA
Anna Paulina Luna, FL
John Duarte, CA
Harriet M. Hageman, WY

                    Vivian Moeglein, Staff Director
                      Tom Connally, Chief Counsel
                 Lora Snyder, Democratic Staff Director
                   http://naturalresources.house.gov

                                 ------                                

               SUBCOMMITTEE ON INDIAN AND INSULAR AFFAIRS

                     HARRIET M. HAGEMAN, WY, Chair
                JENNIFFER GONZALEZ-COLON, PR, Vice Chair
               TERESA LEGER FERNANDEZ, NM, Ranking Member

Aumua Amata C. Radewagen, AS         Gregorio Kilili Camacho Sablan, 
Doug LaMalfa, CA                         CNMI
Jenniffer Gonzalez-Colon, PR         Ruben Gallego, AZ
Jerry Carl, AL                       Nydia M. Velazquez, NY
Jim Moylan, GU                       Ed Case, HI
Bruce Westerman, AR, ex officio      Raul M. Grijalva, AZ, ex officio

                                 ------                                









                               CONTENTS

                              ----------                              
                                                                   Page

Hearing held on Thursday, April 11, 2024.........................     1

Statement of Members:

    Hageman, Hon. Harriet M., a Representative in Congress from 
      the State of Wyoming.......................................     1
    Leger Fernandez, Hon. Teresa, a Representative in Congress 
      from the State of New Mexico...............................     2

Statement of Witnesses:

    Brewer, John D., Jr., Director, Office of Insular Affairs, 
      U.S. Department of the Interior, Washington, DC............     4
        Prepared statement of....................................     5
        Questions submitted for the record.......................     7
    Fleming, Kyle D., Chairman, U.S. Virgin Islands Water & Power 
      Authority, St. Croix, U.S. Virgin Islands..................     8
        Prepared statement of....................................    10
        Questions submitted for the record.......................    12
    Stein, Kenneth, Vice President for Policy, Institute for 
      Energy Research, Washington, DC............................    13
        Prepared statement of....................................    15
        Questions submitted for the record.......................    16
    Guannel, Gregory, Director, Caribbean Green Technology 
      Center, St. Thomas, U.S. Virgin Islands....................    18
        Prepared statement of....................................    19
        Questions submitted for the record.......................    22
    Fisher, Travis, Director, Energy and Environmental Policy 
      Studies, Cato Institute, Washington, DC....................    22
        Prepared statement of....................................    24
        Questions submitted for the record.......................    29

Additional Materials Submitted for the Record:

    Submissions for the Record by Representative Grijalva

        Climate Strong Islands Network, Letter to the Committee..    41

    Submissions for the Record by Representative Velazquez

        Article titled, ``Cuatro de cada 10 personas en Puerto 
          Rico padeceran de cancer en algun momento de sus 
          vidas''................................................    34
                                     








 
 OVERSIGHT HEARING ON ENERGIZING THE TERRITORIES: PROMOTING AFFORDABLE
         AND RELIABLE ENERGY SOURCES FOR THE U.S. INSULAR AREAS

                              ----------                              


                        Thursday, April 11, 2024

                     U.S. House of Representatives

               Subcommittee on Indian and Insular Affairs

                     Committee on Natural Resources

                             Washington, DC

                              ----------                              

    The Subcommittee met, pursuant to notice, at 2 p.m., in 
Room 1324 Longworth House Office Building, Hon. Harriet M. 
Hageman [Chairwoman of the Subcommittee] presiding.
    Present: Representatives Hageman, LaMalfa; Leger Fernandez, 
Sablan, and Velazquez.

    Ms. Hageman. The Subcommittee on Indian and Insular Affairs 
will come to order. Without objection, the Chair is authorized 
to declare a recess of the Subcommittee at any time.
    The Subcommittee is meeting today to hear testimony on 
Energizing the Territories: Promoting Affordable and Reliable 
Energy Sources for the U.S. Insular Areas. Under Committee Rule 
4(f), any oral opening statements at hearings are limited to 
the Chairman and the Ranking Minority Member. I therefore ask 
unanimous consent that all other Members' opening statements be 
made part of the hearing record if they are submitted in 
accordance with Committee Rule 3(o).
    Without objection, so ordered.
    I will now recognize myself for an opening statement.

 STATEMENT OF THE HON. HARRIET M. HAGEMAN, A REPRESENTATIVE IN 
               CONGRESS FROM THE STATE OF WYOMING

    Ms. Hageman. Today's hearing is entitled ``Energizing the 
Territories: Promoting Affordable and Reliable Energy Sources 
for the U.S. Insular Areas.'' We will hear from leaders and 
stakeholders about how Congress can ensure that the territories 
are able to utilize the energy resources that best suit their 
specific needs and desires, not just the energy resources that 
the Biden administration believes should be used. It is not 
Washington, DC's job to pick winners and losers. Energy sources 
should not be deemed less than due to the ebbs and flows of an 
administration.
    Furthermore, the territories have adopted aggressive goals 
for transitioning to wind and solar energy, even though it is 
unclear whether these goals can be met and despite limited 
assurances that these energy sources can even meet baseload 
power demands. This hearing will be an opportunity to get an 
update on the status of these goals and the impact they have 
had on the utility costs for residents in the territories and 
their access to reliable energy.
    The available data suggests that these goals have not been 
met and are among the reasons why the territories have some of 
the highest utility costs in the United States while having 
frequent outages. American Samoa, the Northern Mariana Islands, 
or CNMI, Guam, and the U.S. Virgin Islands need reliable and 
cost-efficient energy resources. Yet, the Biden administration 
has continued to prioritize so-called renewable energy only and 
grid infrastructure, such as solar and wind, over the more 
reliable and affordable liquified natural gas, coal, and 
baseload power options.
    Several Federal grants and loan programs showcase this 
preference. OIA's Energizing Insular Communities, or EIC, 
Program was created to ``provide grant funding for energy 
strategies that reduce the cost of electricity and reduce 
dependence on foreign fuels.'' Utilizing natural resources 
while ensuring American energy is readily available for 
economic and security needs is not limited to so-called 
renewable energy, yet the Biden administration seems to believe 
so.
    IEC grants have been provided to American Samoa Power 
Authority for electric vehicles, to Guam for a 100 percent 
renewable energy study, to CNMI for solar photo voltaic 
systems, and to the U.S. Virgin Islands for battery electric 
vehicles. The snapshot shows the hyper fixation on so-called 
renewables by the Biden administration, a hyper fixation that 
comes at a higher price and also sacrifices reliability.
    The U.S. territories are often subject to severe weather 
incidents which pose a threat to infrastructure reliant on 
solar and wind energy. In Guam, the 2023 Typhoon Mawar ripped 
solar panels from rooftops leading to thousands of people being 
without power for over a week. With U.S. military bases in Guam 
and the planned reopening of the U.S. Air Force airfield in 
Tinian, reliable energy sources are necessary for our military 
capabilities.
    Reliable energy sources are necessary for those that reside 
in these territories and the well-being of those who reside in 
the territories should not be decided on by bureaucrats in 
Washington, DC. The insular areas deserve self-determination of 
Federal policies that do not promote energy poverty.
    Thank you to the witnesses for being with us today. I look 
forward to today's discussion in seeing how we can promote 
affordable and reliable energy sources for the territories.
    The Chair now recognizes the Ranking Minority Member for 
any statement.

STATEMENT OF THE HON. TERESA LEGER FERNANDEZ, A REPRESENTATIVE 
            IN CONGRESS FROM THE STATE OF NEW MEXICO

    Ms. Leger Fernandez. Thank you, Madam Chair, and as always, 
thank you very much for the witnesses for being here. I am 
delighted to be here once again to discuss some of the 
challenges facing Americans residing in the territories, in 
particular the exceedingly high cost of electricity generation 
and what opportunities we can pursue to overcome these 
challenges.
    Guam, the Northern Mariana Islands, American Samoa, and the 
U.S. Virgin Islands face a number of barriers to access to 
reliable and affordable energy. The islands lack 
interconnection to larger electrical grids and there are no 
Indigenous sources of fossil fuels. To my knowledge, there is 
no coal being mined on any of the islands, there is no oil and 
gas being pumped, which means that all of this fuel has to be 
imported, shipped in.
    So-called renewable energy is actually there. The wind 
blows every day. I come from New Mexico and the wind blows 
every day in our plains and we have lots of windmills that are 
popping up, and we know that that might be one of the sources. 
Maybe not something that you will always rely on, but that you 
will be able to rely on to diversify what you rely on. The sun 
comes up every day and that may be a source that you will be 
able to rely on, diversify, because it does already exist in 
the territories.
    Guam has some of the lowest residential electricity rates 
in the Pacific Islands, yet those prices are still twice as 
high as the average in the United States. Part of those prices 
include surcharges to cover petroleum costs. The Guam Power 30 
recently increased residential utility rates from 23 cents to 
26.4 cents per kilowatt hour. In New Mexico, in contrast, where 
we have a mix of energy sources, we pay less than half of that 
and our wind and solar prices are way below that amount.
    American Samoa residents face average prices of 45 cents 
per kilowatt hour, U.S. Virgin Islands residents, 42 cents per 
kilowatt hour, and Northern Mariana Islands residents, 43 cents 
per kilowatt hour. These are prices three to four times as high 
as those in the mainland. Unacceptable. So, we want to find the 
solutions to bring those costs down. Why don't we always want 
to be looking for the kinds of solutions that bring those costs 
down?
    Last Congress, the Offshore Wind for Territories Act was 
signed into law opening the offshore waters around Guam, 
American Samoa, Northern Mariana Islands, Puerto Rico, and the 
U.S. Virgin Islands to wind power development. The U.S. 
Department of the Interior will hold wind lease sales in the 
territories by September 2025, depending on interest from 
energy companies.
    However, each island has their own unique opportunities and 
challenges when it comes to implementing wind power. For 
instance, Guam has substantial wind power potential but also 
unique wind turbine siding issues. CNMI also has installed 
several small-scale wind projects. But wind turbines must 
withstand typhoons and not interfere with airstrip and material 
facilities. We must recognize both the opportunities for energy 
development, their unique situations, and their unique 
obstacles.
    Geothermal may be an option. Hawaii we can look to as an 
example where they have made great efforts to diversify the 
energy portfolio and create a more reliable grid. In 2022, 
Hawaii generated 29 percent of their energy with renewable 
sources including solar, wind, geothermal, biomass, and 
hydropower. The state has a goal of generating 100 percent of 
electricity from renewable sources by 2045. On the big island 
of Hawaii, the Puno Geothermal Venture Plant provides about 30 
percent of the island's electricity demand, 30 percent is 
provided by a single renewable energy plant.
    There are so many different opportunities to pursue to 
overcome the serious challenges our sisters and brothers on the 
other islands face, from energy development, to grid security 
and strength, to weatherization of homes. If you care about 
communities, you work to make them resilient, you work to lower 
their costs. It is our solemn responsibility to care. Not to 
care about one particular industry, not to care about what an 
industry's talking points may be, but to care about improving 
the lives of the people living on these beautiful islands.
    I look forward to hearing from our witnesses about both the 
challenges and the opportunities, how we can work together to 
bring reliable energy, renewable energy, and lower costs to all 
the U.S. territories.

    Ms. Hageman. I will now introduce our witnesses. Mr. John 
Brewer, Director of Office of Insular and International 
Affairs, U.S. Department of the Interior, Washington, DC; Mr. 
Kyle Fleming, Chairman, U.S. Virgin Islands Water and Power 
Authority, St. Croix, U.S. Virgin Islands; Mr. Kenny Stein, 
Vice President of Policy, Institute for Energy Research, 
Washington, DC; Dr. Gregory Guannel, Director, Caribbean Green 
Technology Center, St. Thomas, U.S. Virgin Islands; and Mr. 
Travis Fisher, Director of Energy and Environmental Policy 
Studies at the Cato Institute in Washington, DC.
    Welcome to all of you. We thank you for being here today. 
Let me remind the witnesses that under Committee Rules, they 
must limit their oral statements to 5 minutes, but your entire 
statement will appear in the hearing record. To begin your 
testimony, please press the ``talk'' button on the microphone. 
And we use timing lights. When you begin, the light will turn 
green. When you have 1 minute left, the light will turn yellow. 
And at the end of 5 minutes, the light will turn red, and I 
will ask you to please complete your statement. I will also 
allow all of the witnesses on the panel to testify before we 
begin our Member questioning.
    The Chair now recognizes Mr. Brewer for 5 minutes.

 STATEMENT OF JOHN D. BREWER, JR., DIRECTOR, OFFICE OF INSULAR 
    AFFAIRS, U.S. DEPARTMENT OF THE INTERIOR, WASHINGTON, DC

    Mr. Brewer. Madam Chair, Ranking Member, and members of the 
Subcommittee on Indian and Insular Affairs, thank you for the 
opportunity to testify on affordable and reliable energy 
sources in the insular areas. I am the Director of the Office 
of Insular Affairs at the U.S. Department of the Interior, the 
office responsible for administering the Federal Government's 
relationship with the territories of American Samoa, the CNMI, 
Guam, and USVI. You have my written testimony, so I would like 
to reiterate a few key points.
    The territories face unique energy challenges due to their 
remote locations. Residents and businesses in the territories 
pay an average of 2.4 times more per kilowatt hour than the 
U.S. average. This is largely due to the cost of importing 
fuels and the territories' inability to achieve economies of 
scale by participating in larger interconnected grids.
    The high cost of energy poses challenges for the private 
sector to maintain operations in the territories. Utilities in 
the territories are affected by fluctuations in fuel prices 
resulting in significant impacts on the provisions of goods and 
services to businesses and residents in the territories. Over 
the last decade, the territories have made strides to improve 
their energy security. With Federal partners, they have worked 
to harden energy infrastructure, especially in the wake of 
destructive hurricanes and typhoons.
    Additionally, the territories have diversified their energy 
generation by adopting renewable technologies to supplement 
baseload energy infrastructure and thereby decrease reliance on 
shipments of imported fossil fuels. A little over a decade ago, 
virtually all energy production in the territories was 
dependent on fossil fuels.
    OIA has a long history of supporting the territories with 
increasing access to reliable and affordable energy. The 
Energizing Insular Communities, or EIC, Grant Program began in 
2011 to assist territories as they implement energy strategies 
to reduce the cost of electricity which was three times the 
national average at the time. While the program funding 
available is small relative to the energy needs of the 
territories, its targeted investments do help move the 
territories toward meeting their energy goals.
    OIA requires EIC grant proposals to be tied to each 
territory's energy plan which reflects their self-determined 
energy goals. With $15.5 million available for the four 
territories in Fiscal Year 2023, the EIC program received $33.7 
million in applications. The EIC program is open to proposals 
involving all forms of power generation, including improvements 
related to conventional sources of power generation, such as 
oil and natural gas as identified in local energy plans.
    While replacement of old inefficient diesel fuel generators 
from the 1970s and 1980s would improve territorial energy 
efficiency and security, these replacements are often not 
within the scope of the current EIC program funding level. For 
example, one new 80-megawatt generator would cost approximately 
$94 million, while the EIC's funding level is approximately $15 
million. Additionally, more efficient conventional generators 
may not always provide the cheapest electricity rates, as rates 
for imported fuel would be subject to global fluctuations in 
price and supply.
    The Administration is committed to energy projects that 
promote energy security in the territories as well as projects 
that support a sustainable energy future through investments in 
renewable energy development. Madam Chair, Ranking Member, it 
is a pleasure to appear before your Subcommittee to discuss 
affordable and reliable energy in the territories. Thank you.

    [The prepared statement of Mr. Brewer follows:]
Prepared Statement of John D. Brewer, Jr., Director, Office of Insular 
                Affairs, U.S. Department of the Interior

    Chair Hageman, Ranking Member Leger Fernandez, and members of the 
Subcommittee on Indian and Insular Affairs, thank you for the 
opportunity to testify on affordable and reliable energy sources in the 
U.S. Insular Areas. I am the Director of the Office of Insular Affairs 
(OIA) at the U.S. Department of the Interior, the office responsible 
for administering the Federal government's relationship with the 
territories of American Samoa, the Commonwealth of the Northern Mariana 
Islands (CNMI), Guam, and the United States Virgin Islands (USVI) 
(collectively, the territories). Access to affordable and reliable 
energy is of the utmost importance to the territories as it directly 
impacts their economic development and quality of life.
Overview of Energy Needs in the U.S. Territories

    The territories face unique energy challenges due to their remote 
geographies. Residents and businesses in the territories pay an average 
of 2.4 times more per kilowatt hour than the U.S. average. This 
disparity is largely due to the cost of importing fuels to support 
baseload generation capacity and the territories' inability to achieve 
economies of scale by participating in larger interconnected grids. The 
territories are heavily dependent on imported fossil fuels to support 
baseload energy generation. For the three Pacific territories, refined 
petroleum fuel is imported from Asia (primarily Singapore, South Korea, 
Japan, Malaysia) and for the USVI, petroleum and liquid petroleum gas 
(LPG) is provided from sources abroad.
    When considering median household incomes, residents in the 
territories spend a higher proportion of their income on energy costs, 
resulting in more than double the energy burden compared to the average 
U.S. household.
    Access to reliable and affordable energy in the territories not 
only impacts residents directly today but also has a significant impact 
on future economic growth and development opportunities. The high cost 
of energy poses challenges for the private sector to maintain 
operations in the territories.
    Utilities in the territories are affected by fluctuations in fuel 
prices resulting in significant impacts on the provision of goods and 
services to businesses and residents in the territories.
    Energy reliability impacts every sector in the territories--from 
healthcare to education and private industry to transportation. 
Antiquated and vulnerable infrastructure is consistently tested by the 
energy demands of local communities and adverse weather events, which 
are becoming more severe and more frequent. Unfortunately, the result 
is that power disruptions are now considered a regular part of life in 
many communities in our territories.
    While utility providers work to upgrade their infrastructure to 
meet these challenges, they often lack the resources necessary to make 
the large-scale investments required to modernize and harden their 
infrastructure. To improve energy reliability, the territorial 
utilities have used Power Purchase Agreements (PPAs) with private 
companies to expand generation capacity. While PPAs can be a useful 
tool, they do not solve underlying generation capacity and operational 
issues.
    Over the last decade, the territories have made some strides to 
improve their energy security. With Federal partners, they have worked 
to harden energy infrastructure, especially in the wake of destructive 
hurricanes and typhoons. Additionally, the territories have diversified 
their energy generation by adopting renewable technologies (mostly 
solar and net metering) to supplement baseload energy infrastructure 
and thereby decrease reliance on shipments of imported fossil fuels. 
Renewable power generation now accounts for 3 percent of total power 
generated in both American Samoa and the USVI, 11 percent in the CNMI, 
and 17 percent in Guam. A little over a decade ago, virtually all 
energy production in the territories was dependent on fossil fuels.
OIA Support for Energy Needs in the U.S. Territories

    OIA has a long-standing history of supporting the territories with 
increasing access to reliable and affordable energy. Public Law 109-58, 
enacted in 2005, directed the Secretary of the Interior to draft long-
term energy plans for the insular areas, with the objectives of 
reducing their reliance on energy imports, increasing energy 
conservation and energy efficiency, and using native energy sources. In 
2010, OIA entered into an interagency agreement with the Department of 
Energy's National Renewable Energy Lab (NREL) to help the Pacific 
territories increase energy independence and security. This agreement 
led to an in-depth analysis of the energy situation in each territory 
and culminated in the creation of energy plans that included both 
short-term energy action plans and long-term strategic energy plans 
published in 2013.
    Public Law 113-235 directs the Department of the Interior to 
establish a team of experts to develop energy action plans for the 
territories and assist with their implementation. In 2022, OIA entered 
into a new interagency agreement with NREL to provide technical support 
to OIA and the territories to continue efforts to improve energy 
security and resiliency, reduce energy costs, and diversify energy 
sources.
    OIA provides funding to the territories to support energy security 
through the Energizing Insular Communities (EIC) grant program. The EIC 
program began in 2011 to assist territories as they implement energy 
strategies to reduce the cost of electricity, which was three times the 
national average at the time. The EIC program funding averaged $3.7 
million a year between fiscal years (FY) 2011 and 2020. Since then, 
this Administration has requested, and Congress has appropriated, 
increases to the funding level to its current level at around $15 
million in FY 2024. While the program funding available is small 
relative to the energy infrastructure needs of the territories, its 
targeted investments do help move the territories towards meeting their 
energy goals.
    OIA requires EIC grant proposals to be tied to each territory's 
energy plan, which reflects their self-determined energy goals. Local 
government entities, independent public authorities, and educational 
institutions in the territories are all eligible to apply for funds 
under this competitive program. With $15.5 million available for the 
four territories in FY 2023, the EIC program received $33.7 million in 
applications. Of the applications received, $3.2 million proposed grid 
studies and planning projects; $18.5 million proposed renewable power 
generation, storage, and transmission projects; and $12 million 
proposed demand side management projects. Of that, OIA awarded $3 
million for grid studies and planning projects, $5.1 million for solar 
power generation and storage projects, and $7.4 million for demand side 
management projects.
    The EIC program is open to proposals involving all forms of power 
generation, including improvements related to conventional sources of 
power generation such as oil or natural gas as identified in local 
energy plans. While replacement of old, inefficient diesel fuel 
generators from the 1970s and 1980s would improve territorial energy 
efficiency and security, these replacements are often not within the 
scope of the current EIC program funding level. For example, one new 
80-megawatt generator would cost approximately $94 million, while the 
program funding level is approximately $15 million. Additionally, more 
efficient conventional generators may not always provide the cheapest 
electricity rates, as rates for imported fuel would be subject to 
global fluctuations in price and supply.
    Beyond the EIC program, OIA also coordinates with our interagency 
partners to help identify and provide support to the territories for 
energy-related projects and plans. For example, the Inflation Reduction 
Act revised the Outer Continental Shelf Lands Act to allow for offshore 
wind energy leasing of the submerged lands within the U.S. exclusive 
economic zone adjacent to American Samoa, CNMI, Guam, the USVI, and the 
Commonwealth of Puerto Rico. Further, the Act directed the Secretary of 
the Interior to investigate the feasibility of offshore wind leasing in 
the territories. The Bureau of Ocean Energy Management has started to 
engage with territorial governors regarding potential offshore wind 
energy development for Puerto Rico, Guam, and the USVI.
    The Administration is committed to energy projects that promote 
energy security in the territories as well as projects that support a 
sustainable energy future through investments in renewable energy 
development. Chair Hageman, Ranking Member Leger Fernandez, it is a 
pleasure to appear before your Subcommittee to discuss affordable and 
reliable energy in the territories. Thank you.

                                 ______
                                 

 Questions Submitted for the Record to Mr. John Brewer, Jr., Director, 
       Office of Insular Affairs, U.S. Department of the Interior

Mr. Brewer did not submit responses to the Committee by the appropriate 
deadline for inclusion in the printed record.

            Questions Submitted by Representative Westerman

    Question 1. Several of the territories have set aggressive goals 
for their transition to renewable energy. American Samoa adopted a goal 
to obtain 50% of its energy from renewable sources by 2025 and 100% by 
2040. Guam is also targeting 50% renewable energy by 2035 and 100% by 
2040. The CNMI targeted 20% by 2016. The USVI has a goal for 25% by 
2020, 30% by 2025, and 50% by 2044.

    Are these goals being met or are on track to being met? If not, 
why? Please provide us what the current percentage of each territory's 
energy use is from solar and wind energy in your response.

    Question 2. What is the selection process by which Energizing 
Insular Communities (EIC) grant program awards are granted?
         Questions Submitted by Representative Leger Fernandez

    Question 1. Insular Areas need affordable and reliable energy 
options, and it's clear that the status quo does not provide that. 
Island reliance on foreign imports of diesel fuel is expensive and 
unsustainable, and the climate impacts of continued reliance on fossil 
fuels will be felt first in vulnerable island communities. A transition 
to more sustainable renewable energy is critical. How is the Biden 
administration, through the EIC grant program and others, helping 
island communities address this energy transition in ways that work 
best for each island community, ensuring island self-determination?

    Question 2. The EIC program currently provides about $15 million 
(as of FY 2024) to help the territories implement their energy plans, 
however you note in your written testimony that at times DOI receives 
more than double that amount in applications. How does OIA address that 
gap and what additional support can the Federal Government provide to 
help the territories meet their energy goals?

    Question 3. The Inflation Reduction Act included $15 million for 
the Office of Insular Affairs to provide technical assistance to the 
U.S. Territories for climate change planning, mitigation, adaptation, 
and resilience. Could you share how OIA has been utilizing this 
funding, especially for energy projects in the territories?

                                 ______
                                 

    Ms. Hageman. Thank you, Mr. Brewer, for your testimony.
    The Chair now recognizes Mr. Fleming for 5 minutes.

  STATEMENT OF KYLE D. FLEMING, CHAIRMAN, U.S. VIRGIN ISLANDS 
    WATER & POWER AUTHORITY, ST. CROIX, U.S. VIRGIN ISLANDS

    Mr. Fleming. Thank you, and good afternoon, Madam Chair, 
and other members of the Subcommittee. Thank you for the 
opportunity to testify on behalf of the U.S. Virgin Islands 
relative to the ongoing and future impacts the Biden-Harris 
administration's energy policy is having on the territory.
    My name is Kyle Fleming, Director of the Virgin Islands 
Energy Office and Chairman of the Governing Board of the Virgin 
Islands Water & Power Authority. Despite the territory's small 
footprint, the reliable and affordable energy supply has proven 
to be a complicated endeavor. In summary, the challenges the 
territory's energy landscape faces are as follows:

    1. The U.S. Virgin Islands' heavy reliance on imported 
fossil fuels for electricity generation, which not only 
contributes to high energy costs but also leaves the Virgin 
Islands vulnerable to supply disruptions and price fluctuations 
of global fuel markets.

    2. Geographical constraints, such as complex and heavily 
vegetated topography, sub-sea transmission cables, and limited 
land availability, present logistical challenges to centralized 
generation and distribution of energy at scale.

    3. The need for holistic energy transition planning and 
modeling rather than reactionary energy investments aimed to 
mitigate immediate energy emergencies.

    4. Finally, the high upfront costs of the energy transition 
within an island network that requires a significant investment 
in infrastructure and grid modernization to fully realize the 
positive impacts of the transition.

    Despite these challenges, the Virgin Islands have access to 
extensive renewable energy resources that can be managed by 
energy storage innovations to mitigate intermittency issues. 
Pairing these renewable resources with efficient thermal 
generation and affordable fuel supply could fast-track the 
diversification of our energy mix away from exclusively 
imported fossil fuels. Reducing fossil fuel dependence for 
electricity generation and transportation needs will have the 
most immediate effect on managing the territories' exposure to 
the volatile commodity markets.
    The Biden-Harris energy policy resonates with the Virgin 
Islands and Governor Albert Bryan's strategy to alleviate the 
energy burdens of the territory through innovative energy 
solutions. The alignment of these visions underscores a shared 
territorial and Federal commitment to a sustainable and 
resilient future.
    A couple examples include the State Energy Program which is 
a formula-based funding opportunity that the Virgin Islands has 
historically leveraged to support small-scale energy programs 
historically limited by funding allotments which were budgeted 
at approximately $300,000 annually. Under the Bipartisan 
Infrastructure Law, the Virgin Islands received a bolstered 
allocation of $2.59 million to support our energy programs. 
This funding augmentation has enabled an expanded portfolio of 
locally available energy incentives to include an equitable e-
mobility rebate program designed to lower the costs of electric 
vehicle adoption as well as a battery energy storage rebate 
program designed to bolster energy resilience through home-
based energy storage.
    Additionally, the Department of the Interior's Office of 
Insular Affairs has served as a steadfast advocate for the 
insular territories. The Virgin Islands have leveraged 
competitive grant awards under OIA's Energizing Insular 
Communities Program to support the development of microgrids, a 
critical infrastructure across the territory. Under the Biden-
Harris administration, the territory has seen funding 
augmentations here as well.
    For reference, the Virgin Islands received approximately 
$625,000 in 2019 under the EIC. By comparison, in 2023, the 
territory was awarded $3.93 million under that funding cycle. 
These funds will support the development of additional 
microgrids and critical infrastructure, the procurement of 
electric vehicle within the government fleet, and deployment of 
renewably-powered DC fast-charging stations to support the 
growing penetrations of electric vehicles within the territory.
    Of the many funding opportunities made available to the 
territory under the Inflation Reduction Act, the impact 
potential of EPA's Solar for All grant stands above them all. 
And in October 2023, the Virgin Islands submitted a proposal 
requesting $100 million in funding to support the deployment of 
residential rooftop solar, community solar, and associated 
battery storage. When aggregated, these technologies could be 
leveraged to create virtual power plants and provide both 
direct and distributed energy savings and overall grid 
resilience.
    Additionally, the Virgin Islands has been actively pursuing 
the expanded program eligibility and loan authority of the U.S. 
Department of Energy's Loan Program under the Biden-Harris 
administration. This has provided an opportunity for the Virgin 
Islands to approach holistic energy solutions with an 
affordable and sustainable financing mechanism that did not 
exist before. Coupling comprehensive energy transition strategy 
with financing mechanisms such as the LPO would unlock the 
territorial benefits that have historically been limited to the 
pages within planning reports.
    In closing, transcending the geographical challenges 
inherent to sustaining energy within a remote insular territory 
requires a custom-tailored approach to the energy transition 
planning and implementation. While the territories' challenges 
are uniquely nuanced, the Biden-Harris energy policy has 
provided augmented funding, technical support, and insular 
prioritization that enables the Virgin Islands to define and 
implement our energy future through a modern-day lens. Thank 
you.

    [The prepared statement of Mr. Fleming follows:]
    Prepared Statement of Kyle D. Fleming, Director, Virgin Islands
                      Energy Office and Chairman,
        Governing Board, Virgin Islands Water & Power Authority

Introduction & Background

    Good afternoon, Chairman Hageman and other members of the 
Subcommittee on Indian and Insular Affairs. Thank you for the 
opportunity to testify on behalf of the United States Virgin Islands 
relative to the ongoing and future impacts the Biden-Harris 
administration's energy policy is having on the territory. My name is 
Kyle Fleming, Director of the Virgin Islands Energy Office (VIEO) and 
Chairman of the Governing Board of the Virgin Islands Water & Power 
Authority (VIWAPA).
    The USVI comprises of three main islands in the Caribbean, with a 
total area of 133 square miles, about twice the size of Washington D.C. 
The islands of St. Croix, St. John, and St. Thomas house nearly all the 
territory's 90,000 residents. And while the VI is truly an American 
paradise, we are also positioned on the front-line of climate change 
which has been highlighted by the deterioration of our fragile marine 
ecosystems and the growing intensity of the annual hurricane season. 
For reference, USVI was struck by two Category 5 hurricanes in 2017, 
Hurricanes Irma and Maria, and these back-to-back storms caused 
significant damage to most of USVI's electric distribution system, 
power-generation, and transmission sub-stations. Although Hurricanes 
Irma and Maria arrived more than six (6) years ago, high electricity 
costs and power instability from these storms continue to hamper the 
Virgin Islands economic recovery. Energy remains the single most 
comprehensive and critical factor to be addressed for our territory's 
future. Systemic energy instability has direct and indirect negative 
impacts on sustainable economic development. Additionally, it has been 
proven that disruptions to the electrical system may magnify existing 
societal vulnerabilities and tensions for families and in the delivery 
of government services.

    Despite the USVI's small footprint, reliable and affordable energy 
supply has proven to be a complicated endeavor. The Virgin Islands 
Water and Power Authority (WAPA) has the sole responsibility of 
producing electricity, primarily through imported petroleum products, 
and distributing electricity to approximately 55,000 residential and 
commercial customers. In summary, the challenges of the territory's 
energy landscape faces are as followed:

  1.  USVI's heavy reliance on imported fossil fuels for electricity 
            generation, which not only contributes to high energy costs 
            but also leaves the USVI vulnerable to supply disruptions 
            and price fluctuations in global fuel markets.

  2.  Geographical constraints such as complex and heavily vegetated 
            topography, subsea transmission cables, and limited land 
            availability, present logistical challenges to centralized 
            generation and distribution of energy at scale.

  3.  The need for holistic energy transition planning and modeling 
            rather than reactionary energy investments aimed to 
            mitigate immediate energy emergencies.

  4.  The high upfront costs of the energy transition within an island 
            network that requires a significant investment in 
            infrastructure and grid modernization to fully realize the 
            positive impacts of the transition.

  5.  Finally, regulatory and policy barriers that hinder the adoption 
            of alternative energy, including outdated regulations, 
            permitting processes, and limited access to traditional 
            financing.

    Despite these challenges, there is an ever-growing recognition of 
the urgent need to transition to a cleaner, more resilient distributed 
energy system in the U.S. Virgin Islands, driven by both the potential 
for long-term economic sustainability and territorial transformational 
growth. The U.S. Virgin Islands are well-positioned to leverage the 
high impact potential of a comprehensive energy transition. The Virgin 
Islands have access to extensive renewable energy resources that when 
paired with efficient thermal generation and managed by energy storage 
innovations will fast-track the reduction of costly imported fossil 
fuel. Limiting fossil fuel dependence, for both electricity generation 
and transportation needs, will have the most immediate effect on 
providing energy burden relief within our community.
    Reducing the price of America's Paradise by creatively deploying 
innovative and disruptive solution sets that address the unique 
realities of attaining sustainability within a remote island nation is 
at the core of the Virgin Islands energy strategy. The Biden-Harris 
energy policy has played an integral role in providing the USVI with a 
once in a generation opportunity to convert this strategy into 
implementable near-term shovel ready projects that will redefine the 
energy landscape of the Virgin Islands.
Territory Impact from Biden Administration Energy Policy:
    The Inflation Reduction Act, signed by President Biden on August 
16, 2022, marked a historic moment in U.S. clean energy and climate 
policy. The IRA built on the foundational climate and clean energy 
investments in President Biden's Bipartisan Infrastructure Law. The 
passage of these landmark federal laws could not have come at a more 
crucial time in the U.S. Virgin Islands history. As we find ourselves 
six years removed from the 2017 hurricanes, which highlighted the 
vulnerability of our island's energy system. The IRA has been heralded 
as the most significant climate legislation in U.S. history, offering 
funding, programs, and incentives to accelerate the transition to a 
clean energy economy and will drive significant deployment of new clean 
electricity resources. These federal initiatives resonate with the 
Virgin Islands and Governor Albert Bryan's strategy to alleviate the 
energy burdens of the territory through innovative energy solutions. 
The alignment of these visions underscores a shared Territorial and 
Federal commitment to a sustainable and resilient future.
    The Virgin Islands are focused on the development and 
implementation of sustainable energy policies, programs, and projects. 
The windfall of clean energy funding, under the IRA & BIL, facilitates 
the fulfilment of the territory's mission and more importantly, ensures 
that meaningful and tangible impacts are realized across our territory. 
The territory's impact potential because of the Biden-Harris Energy 
Policy spans a range of policy areas and to date, many have already 
come to fruition.
State Energy Program (DOE)

    The State Energy Program (SEP) is a formula-based funding 
opportunity that the Virgin Islands has historically leveraged to 
support small-scale energy programs, limited by funding allotments 
which were budgeted at approximately $300,000 annually. Under the 
Bipartisan Infrastructure Law, the Virgin Islands received a bolstered 
allocation of $2.59 Million to support our state energy programs. The 
SEP funding augmentation has enabled an expanded portfolio of locally 
available energy incentive programs. To include an Equitable E-Mobility 
Rebate Program designed to lower the cost of electric vehicle adoption 
as well as a Battery Energy Storage Rebate Program designed to bolster 
energy resilience through home-based battery adoption.
Energizing Insular Communities (DOI)

    The Department of Interior's Office of Insular Affairs (OIA) serves 
as a steadfast advocate for all insular territories. The Virgin Islands 
have leveraged competitive grant awards under the OIA's Energizing 
Insular Communities (EIC) Program to support the development of micro-
grids at critical infrastructure across the territory. The true impact 
of this funding source has been limited by funding allotments, but 
fortunately under the Biden-Harris Administration, the territory has 
seen funding augmentations here as well. For reference the Virgin 
Islands received $625,000 in 2019 under the EIC; by comparison in 2023 
the territory was awarded $3.93 Million. These funds will support the 
development of additional micro-grids at critical infrastructure, 
procurement of electric vehicles within the government fleet, and 
deployment of renewably powered DC fast-charging stations to support 
the growing penetration of electric vehicles within the territory.
Solar For All & Loan Program Office

    Of the many funding opportunities made available to the territory 
under the IRA, the impact potential of EPA's ``Solar for All'' (SFA) 
grant stands above them all. On June 28th, 2023, EPA launched a $7 
billion grant competition through President Biden's Investing in 
America agenda to increase access to affordable, resilient, and clean 
solar energy for low-income households. In October 2023, the VIEO 
submitted a proposal requesting $100 Million in SFA funding to support 
the deployment of Residential Rooftop Solar, Community Solar Programs, 
and associated Battery Energy Storage. When aggregated, these 
technologies will be leveraged to create Virtual Power Plants (VPP) 
that provide both direct and distributed energy savings and grid 
resilience to the territory's grid. These solutions have the power to 
reshape the energy market of the US Virgin Islands and expeditiously 
propel the territory towards a sustainably powered future.
    The Virgin Islands has been actively pursuing the expanded program 
eligibility and loan authority of the U.S. Department of Energy's Loan 
Program Office under the Biden-Harris administration. This has provided 
an opportunity for the Virgin Islands to approach holistic energy 
solutions with an affordable and sustainable financing mechanism that 
did not exist before. Coupling comprehensive energy transition strategy 
with financing mechanisms such as the LPO would unlock territorial 
benefits that have historically been limited to pages within planning 
reports.
Conclusion

    In closing, transcending the geographical challenges inherent in 
sustaining energy access to the remote insular territories requires a 
custom-tailored approach to energy transition planning and 
implementation. While the challenges of territory are uniquely nuanced, 
The Biden-Harris energy policy provides augmented funding, technical 
support, and insular prioritization that enables the Virgin Islands to 
define and implement our energy future through a modern-day lens.

                                 ______
                                 

   Questions Submitted for the Record to Mr. Kyle Fleming, Chairman,
             U.S. Virgin Islands Water and Power Authority

Mr. Fleming did not submit responses to the Committee by the 
appropriate deadline for inclusion in the printed record.

            Questions Submitted by Representative Westerman

    Question 1. In your written testimony, you state that there are 
high upfront costs to energy transition. You state that this is due to 
the need for significant investment in infrastructure and grid 
modernization in order to fully realize the positive impacts of the 
transition.

    In your estimate, how much is the cost for this transition?

    Question 2. In your written testimony, you pointed to the 
destruction that the hurricanes have had on the solar grids and the 
fact that the power instability from these storms continue to hamper 
USVI's economic recovery.

    Can you elaborate for us what those economic impacts are?

    Question 3. How does the policy of energy self-determination 
benefit the U.S. Virgin Islands?

    Question 4. In 2012, the Hovensa oil refinery on St. Croix was shut 
down. In 2021, the refinery was sold to two new companies, who plan on 
restarting the refinery. There have been multiple delays in this 
process due to restrictive actions and policies from the federal 
government.

    What impacts did the closing of the oil refinery have on the 
overall cost of energy in the USVI?
         Questions Submitted by Representative Leger Fernandez

    Question 1. The St. Croix refinery has a long history of polluting 
the surrounding community and environment, which has been well 
documented by the local community and the national news, yet there are 
some who want to continue to pour resources into reopening and 
continuing that status quo. How could the investments being made in 
reopening the refinery be better used to support energy technology 
innovation that will provide St. Croix communities with cleaner, more 
sustainable energy in the future?

                                 ______
                                 

    Ms. Hageman. Thank you, Mr. Fleming, for your testimony.
    The Chair now recognizes Mr. Stein for 5 minutes.

    STATEMENT OF KENNETH STEIN, VICE PRESIDENT FOR POLICY, 
         INSTITUTE FOR ENERGY RESEARCH, WASHINGTON, DC

    Mr. Stein. Madam Chair, thank you for the opportunity to 
testify at this hearing.
    The goal of energy policy in a modern society should be 
ensuring affordable, reliable, and abundant energy supplies. 
These three eminently achievable goals should be the entire 
focus of policymaking as they provide the firm foundation on 
which modern life depends. Ideological preferences, such as 
picking certain energy sources for support and subsidy, should 
have no place in an energy policy focused on human flourishing.
    When it comes to the U.S. insular areas, which are already 
economically disadvantaged, it is even more crucial that energy 
policy should be driven by what works best for the populations 
of these islands, not the ideological preferences of 
Administration officials. Insular areas should not be used for 
experimental energy policy just because they are subject to 
more Federal control and coercion than states. In these 
communities, energy is already often expensive and unreliable 
due both to remoteness as well as existing poor policy choices.
    The Federal Government should not be exacerbating these 
existing deficiencies with ideological meddling, such as 
aggressively pushing expensive and unreliable electricity 
sources. If a rich state like California votes to raise costs 
and wreck its electricity grid with regulations and mandates, 
that is at least their choice. Washington, DC imposing these 
destructive policies on less than rich islands, knowing the 
negative consequences, is frankly immoral.
    The simple fact is, especially when it comes to island 
territories, that wind and solar fail all three energy policy 
tests. They are expensive, unreliable, and only intermittently 
abundant.
    First, neither wind nor solar are a particularly cheap way 
to produce energy. Claims of the cheapness of these sources 
usually rely on inappropriate use of levelized cost of 
electricity measures or noting that once constructed there are 
no input costs for fuel. But while wind and solar certainly are 
cheap when the wind happens to be blowing or the sun is 
shining, there are grid level costs to wind and solar that are 
not included in most LCOE calculations.
    Wind and solar require more transmission spending than 
concentrated generation sources as well as needing expensive 
backup capacity. Batteries alone are not sufficient for backup 
as capacity because, beyond a few hours, batteries become 
prohibitively expensive. Therefore gas, diesel, coal, or hydro 
backup generation is also needed.
    A wind and solar grid thus effectively requires building 
the same capacity at least three times. That is before 
considering that wind and solar alone typically have to 
overbuild capacity because of their intermittency and that wind 
and solar facilities don't last nearly as long as other 
generation options. For islands specifically, there is an 
additional non-monetary cost in land use demands. As islands, 
land is by its nature limited, so grid scale wind and solar 
simply require too much land to be practical for a small 
island. Put simply, a wind and solar grid is a recipe for 
spiraling costs.
    Second, wind and solar by their nature are intermittent and 
thus unreliable. The wind does not always blow and even in 
sunny places the sun doesn't shine at night. As mentioned 
above, some of this intermittency can be expensively accounted 
for by battery backup, but to fully address intermittency, full 
gas, coal, diesel, or hydro backup capacity must be maintained. 
If you must build and maintain full conventional capacity 
anyway, why are we spending the extra money and consuming the 
extra land required to build wind and solar generation.
    Here again, islands face unique challenges in dealing with 
wind and solar intermittency. The way that California, who is 
often touted as a leader in renewable electricity generation, 
gets away with leaning heavily on wind and solar is that the 
state imports electricity from its neighbors. Indeed, imports 
through cross-continental grids are integral to every model 
that attempts to show that wind and solar can be relied upon to 
power a modern society. Obviously, that is not an option for a 
remote island.
    Hurricanes and typhoons are another unique issue that makes 
wind and solar suboptimal for U.S. insular territories. Solar 
arrays are fragile and exposed to storms, and wind turbines 
can't operate in high winds and are subject to damage because 
they are also out in the elements. At the time that electrical 
reliability becomes most crucial for a remote island, during a 
natural disaster, is when wind and solar are subject not just 
to being knocked off-line by a downed power line, but being 
rendered fully inoperable.
    Third, wind and solar fail the standard of abundance, by 
which I mean readily available at whatever amount is needed. 
Wind and solar, as intermittent sources, are not always 
available and, as previously mentioned, battery storage becomes 
prohibitively expensive beyond a few hours of backup. Now, to 
be fair on this count, other generation sources can be lacking 
as well since physical resources must be imported from long 
distances to power conventional plants. But physical resources 
are easily stockpiled for emergencies, in a way that wind and 
solar electrons cannot be.
    When considering the best energy supplies for U.S. 
territories, on the basis of affordability, reliability and 
abundance, wind and solar are substantially deficient. Solar 
generation has at least some role to play, given that 
generation peaks during the hottest part of the day when 
consumption of air conditioning is at its peak, but it is not 
practical or desirable to have a grid that is primarily on 
solar. A mix of energy sources, with the large majority 
provided by stable supply, should be the near-term goal and 
long-term, LNG is probably the best solution.
    It is only in recent years that global LNG supplies have 
reached the levels that spot markets have developed. This 
increased supply, combined with U.S. territories' geographic 
location near to large LNG suppliers such as Trinidad and 
Australia, makes LNG a real option for U.S. territories in a 
way it has not historically been.
    Finally, there are also actions that Congress or the 
Administration could take to ease the shipping costs that 
contribute to high energy prices in the territories.
    I look forward to responding to any of your questions. 
Thank you very much.

    [The prepared statement of Mr. Stein follows:]
    Prepared Statement of Kenneth Stein, Vice President for Policy,
                     Institute for Energy Research

    My name is Kenny Stein, I am the Vice President for Policy for the 
Institute for Energy Research, a free-market organization that conducts 
research and analysis on the function, operation, and regulation of 
energy markets.
    The goal of energy policy in a modern society should be ensuring 
affordable, reliable and abundant energy supplies. Especially in a 
wealthy society like the United States, these three eminently 
achievable goals should be the entire focus of policy making as they 
provide the firm foundation on which a comfortable modern life depends. 
Ideological preferences, such as picking certain energy sources for 
support and subsidy, should have no place in an energy policy focused 
on human flourishing.
    When it comes to U.S. insular areas, which are already economically 
disadvantaged compared to the mainland, it is even more crucial that 
energy policy should be driven by what works best for the populations 
of these islands, not the ideological preferences of administration 
officials. Insular areas should not be used for experimental energy 
policy just because they are subject to more federal control and 
coercion than states. In these communities energy is already often 
expensive and unreliable, due both to remoteness as well as existing 
poor policy choices. The federal government should not be exacerbating 
these existing deficiencies with ideological meddling such as 
aggressively pushing expensive and unreliable electricity sources. If a 
rich state like California votes to raise costs and wreck its 
electricity grid with regulations and mandates, that's at least their 
choice. Washington, DC imposing these destructive policies on less than 
rich island communities, knowing the negative consequences, is frankly 
immoral.
    The simple fact is that, especially when it comes to island 
territories, wind and solar fail all three energy policy tests: they 
are expensive, unreliable and only intermittently abundant.
    Firstly, neither wind nor solar are a particularly cheap way to 
produce energy. Claims of the cheapness of these sources usually rely 
on the inappropriate use of Levelized Cost of Electricity (LCOE) 
measures or noting that once constructed there are no input costs for 
fuel. But while wind and solar certainly are cheap when the wind 
happens to be blowing or the sun is shining, there are grid level costs 
of wind and solar that are not included in most LCOE calculations. Wind 
and solar require more transmission spending than concentrated 
generation sources as well as needing expensive backup capacity. 
Batteries alone are not sufficient for backup as capacity beyond a few 
hours becomes prohibitively expensive. Therefore gas, diesel, coal, or 
hydro backup generation is also needed. A wind and solar grid thus 
effectively requires building the same capacity at least three times. 
That is before considering that wind and solar alone typically have to 
overbuild capacity because of their intermittency and that wind and 
solar facilities don't last nearly as long as other generation options. 
For islands specifically, there is an additional non-monetary cost in 
land use demands. As islands, land is by its nature limited, grid scale 
wind and solar simply require too much land to be practical for a small 
island. Put simply, a wind and solar grid is a recipe for spiraling 
costs.
    Second, wind and solar are by their nature intermittent and thus 
unreliable: the wind does not always blow and even in sunny places the 
sun does not shine at night. As mentioned above, some of this 
intermittency can be expensively accounted for by battery backup, but 
to fully address intermittency, as a wealthy developed society must 
provide as a bare baseline, full gas, coal, diesel, or hydro backup 
capacity must be maintained. If you must build and maintain full 
conventional capacity anyway, why spend the extra money and consume the 
extra land required to build up wind and solar generation. Here again, 
islands face unique challenges in dealing with wind and solar 
intermittency. The way that California, often touted as a leader in 
renewable electricity generation, gets away with leaning heavily on 
wind and solar is that the state imports electricity from its neighbors 
at night or when the wind is not blowing. Indeed, imports through 
cross-continental grids are integral to every model that attempts to 
show that wind and solar can be relied upon to power a modern society. 
That's not an option for a remote island. Hurricanes and typhoons are 
another unique issue that makes wind and solar suboptimal for U.S. 
insular territories: solar arrays are fragile and exposed to these 
storms, wind turbines cannot operate in high winds and are subject to 
damage. At the time that electrical reliability is most crucial for a 
remote island, during a natural disaster, is when wind and solar are 
subject not just to being knock offline by a downed power line, but 
being rendered fully inoperable.
    Third, wind and solar fail the standard of abundance, by which I 
mean readily available at whatever amount is needed. Wind and solar, as 
intermittent sources, are not always available, and as previously 
mentioned battery storage becomes prohibitively expensive beyond a few 
hours of backup. Now to be fair on this count, other generation sources 
can be lacking as well since physical resources must be imported from 
long distances to power conventional plants. But physical resources are 
easily stockpiled for emergencies, in a way that wind and solar 
electrons cannot be.
    When considering the best energy supply options for U.S. 
territories, on the basis of affordability, reliability and abundance 
wind and solar are substantially deficient. Solar generation has at 
least some role to play, given that generation peaks during the hottest 
part of the day when consumption for air conditioning is highest, but 
it is not practical or desirable to have a grid that is reliant 
primarily on solar. A mix of energy sources, with the large majority 
provided by stable supply, should be the near term goal and long-term, 
LNG is probably the best solution. It is only in recent years that 
global LNG supplies have reached the levels that spot markets have 
developed. This increased supply, combined with U.S. territories' 
geographic location near to large LNG suppliers like Trinidad and 
Australia, makes LNG a real option for U.S. territories in a way that 
is has not historical been. Finally, there are also actions Congress or 
the administration could take to ease the shipping costs that 
contribute to high energy prices in the territories.
    U.S. insular territories face unique challenges in supplying the 
energy needed to support modern life. While wind and solar may 
superficially look like a way around those challenges, beyond a 
possible small percentage contribution, both are insufficient for 
supporting an entire grid, especially for a remote island. Pushing 
these suboptimal resources will be an expensive and unnecessary detour 
on the way to actual long term solutions.

                                 ______
                                 

 Questions Submitted for the Record to Mr. Kenny Stein, Vice-President 
                of Policy, Institute for Energy Research

            Questions Submitted by Representative Westerman

    Question 1. How much does it generally cost for a state or a 
territory to transition to renewables?

    Answer. It is hard to estimate a firm number for a variety of 
reasons. One, no state or territory has come anywhere close to actually 
transitioning to renewables if we mean wind and solar (if hydroelectric 
generation is included, there are a few states that get close). Two, 
every states' electricity situation is different: some states are 
members of cross-state markets, some states rely heavily on imports, 
some states allow natural gas to be used to backup wind and solar, and 
so on.
    What we can say generally is that the states with the most 
aggressive pro-W+S mandates, regulations, and subsidies also tend to 
have the highest electricity rates in the country. California 
consistently has been at or near the top of highest electricity prices 
in the continental U.S., followed by all the states in the northeast. 
This pattern can be seen in other parts of the world like Europe, 
Canada and Australia where higher W+S reliance correlates with higher 
than average electricity rates.

    Question 2. The territories pay on average two to three times what 
states pay for their utilities. There are concerns that prioritizing 
renewable energy would cause utility prices to go up even higher in the 
territories.

    Do you have an estimate on the impact of renewable energy 
transition has on utility prices here in the U.S.?

    Answer. As described in the previous response, estimating a firm 
number is difficult for a variety of reasons, there are many factors 
that impact utility rates, everything from the rate setting process, 
consumer demand, state regulations, market design, and many more.
    What we can say generally is that the states with the most 
aggressive pro-W+S mandates, regulations, and subsidies also tend to 
have the highest electricity rates in the country. California 
consistently has been at or near the top of highest electricity prices 
in the continental U.S., followed by all the states in the northeast. 
This pattern can be seen in other parts of the world like Europe, 
Canada and Australia where higher W+S reliance correlates with higher 
that average electricity rates.
    It is very clear that W+S at the grid level are very expensive. At 
the individual turbine, electricity appears cheap when the wind is 
blowing. However, the extra cost to the grid of building transmission, 
backup capacity, and balancing intermittency makes solar and especially 
wind extremely expensive at the grid level. This means higher electric 
rates, and these costs only increase as the percentage of renewable 
generation increases.

    Question 3. Why are baseload options such as natural gas and coal 
much more reliable and cheaper than renewables?

    Answer. On reliability, both coal and natural gas are dispatchable, 
they can be turned on and off, and generation can be increased or 
decreased, in relatively short periods of time. This means that they 
are ideal for responding to electric load that fluctuates throughout 
the day. This responsiveness makes for a more reliable electricity 
supply in contrast to W+S which operate on their own schedule subject 
to the weather. It is notable that even in states and countries that 
have high percentages of electricity coming from W+S, these countries 
mostly maintain natural gas generation capacity to backup W+S 
intermittency.
    This intermittency is also why coal and natural gas are almost 
always cheaper to run at a grid level. In order for W+S heavy grids to 
provide reliable electricity, huge additional spending on transmission, 
backup, and balancing are required, spending that is largely 
unnecessary for a coal or natural gas based grid. In order to have a 
heavily W+S grid, you essentially have to overbuild, replicating the 
grid several times: extra W+S, extra transmission, battery or natural 
gas backup supply. There has to be a lot of duplication to try to 
account for weather unreliability, and that is expensive to build and 
maintain.

    Question 4. The solar panels needed for solar energy, the primary 
source of renewable energy for the territories, are made from critical 
minerals.

    Where are the minerals being used to make the solar panels used in 
the U.S. coming from? Are they from the U.S.? Allied or partner 
countries? Our adversaries?

    Answer. It of course depends on the specific minerals needed, but 
the supply chains for most mineral inputs to solar panels are dominated 
by China, as is the supply of finished panels. Even when the mining of 
a mineral happens elsewhere (e.g. cobalt from Congo, or nickel from 
Indonesia), the processing of those minerals happens in China or are 
processed in other countries by Chinese companies. This dominance is 
similar in the supply chains of batteries, which are the posited backup 
for most solar projects. While some mineral input processing, for 
example for copper and aluminum, are relatively well distributed around 
the world (though China is usually the largest single processor), other 
minerals are heavily Chinese controlled. For example, silicon is around 
80% Chinese processed, and rare earths, several of which are used in 
solar panels, are around 85% Chinese processed. Dominance in some 
battery minerals is even more significant: China controls over 90% of 
manganese processing and around 100% of graphite processing.
    Even when the U.S. mines a mineral domestically, it is often still 
processed through Chinese supply chains. For example, the rare earth 
minerals produced at the Mountain Pass mine in California have to be 
shipped to China for processing.

    4a) Would it be fair to say that the Biden administration's 
restrictions on deep-sea mining and natural gas, coupled with the 
prioritization on renewables, are severely limiting our energy 
generation potential and pushing us to rely more on the People's 
Republic of China?

    Answer. Certainly. The Biden administration's mining restrictions 
eliminate any possibility of breaking Chinese supply dominance 
mentioned in the previous response. And restricting supply of natural 
gas, of which the U.S. has hundreds of years-worth of reserves, would 
mean that our energy needs have to be served by imports. China has 
heavily subsidized the development of batteries and renewables because 
it does not have the domestic energy reserves (other than coal) that 
the U.S. is blessed with. Hampering domestic mineral and energy 
production means relying on foreign sources of those resources.

                                 ______
                                 

    Ms. Hageman. Thank you, Mr. Stein, for your testimony.
    The Chair now recognizes Mr. Guannel for 5 minutes.

  STATEMENT OF DR. GREGORY GUANNEL, DIRECTOR, CARIBBEAN GREEN 
       TECHNOLOGY CENTER, ST. THOMAS, U.S. VIRGIN ISLANDS

    Dr. Guannel. Good afternoon, Chair Hageman, Vice Chair 
Gonzalez-Colon, and members of the Subcommittee. Thank you for 
the opportunity to testify today regarding the need for 
affordable and reliable energy sources in the insular areas. My 
name is Gregory Guannel, and I am the Director for the 
Caribbean Green Technology Center at the University of the 
Virgin Islands.
    The U.S. territories, which are important for national 
security and identity, are small islands far from the mainland, 
with limited natural resources. We are small markets who must 
import fuel at high costs. Territories must operate their 
electricity system without the ability to tap into larger 
electricity markets when problems arise. As a result, we have 
the highest energy costs in the nation and any generation or 
distribution issue turns into an outage or a blackout that can 
last hours, days, sometimes weeks.
    This situation makes access to electricity a struggle for 
many and a drag on the economy. Electricity and the technology 
that it powers is critical to conduct business, to communicate, 
to access water, to keep food and medicine cold. It is 
critical, especially for older people, breathing machines, 
wheelchairs, fridges for medicine, safety, lighting, all these 
depend on a dependable and sustained supply of electricity. In 
my written testimony, I provide a few examples of how residents 
describe reliable access to electricity as a matter of 
survival.
    Be sure, we in the territories have adapted to living with 
frequent disruption and high costs. Most people, including me, 
own gas stoves instead of electric ones. Gas dryers and gas 
water heaters are common and many, including me, have their own 
generators. Nevertheless, our quality of life, economic 
competitiveness, and security is compromised by our fragile 
electrical infrastructure and unreliable and affordable access 
to fuel.
    Given the critical importance that electricity plays in our 
lives, it is imperative that we change the way we think about 
power production, power delivery, and power management. We must 
adopt technologies that make adaptation to disruptions easier 
and simpler. Decentralized power production facilitated by 
solar power generation and batteries, and even electric cars, 
actually allow us to do so.
    Investment and grants from Federal agencies to assist 
island, rural, and isolated communities to access technologies 
like solar power and batteries are actually critical to our 
survival. They allow us to modernize electricity and 
transportation infrastructure, build microgrid, and make sure 
that we have access to affordable and reliable power so that 
businesses can finalize the transactions, schools can keep the 
AC on, military facilities and families can lead normal lives, 
and hospitals can continue to serve patients.
    I would like to note that the case for rapid investment in 
alternative decentralized sources of power applies beyond the 
territories. Since the early 2000s, a number of severe 
electrical outages has been steadily increasing around the 
country. Last week, more than a half million people in the 
Northeast lost power after a series of storms. I am sure that a 
few of them are now considering investing in alternate sources 
of power and decentralized sources of power.
    Also, it is important to note that in the Pacific and in 
the Caribbean these programs are a way to showcase American 
engineering technology and innovation in regions where foreign 
entities are aggressively offering their energy services and 
building large solar power plants in other nations.
    Americans in the U.S. territories provide critical 
cultural, economic, and security services to our country. We 
need to ensure that programs from Federal agencies that provide 
assistance to diversify the energy portfolio by investing in 
solar power and alternative decentralized solutions continue to 
exist. Thank you.

    [The prepared statement of Dr. Guannel follows:]
Prepared Statement of Gregory Guannel, Ph.D., Director, Caribbean Green 
          Technology Center, University of the Virgin Islands

    Chair Hageman, Vice-Chair Gonzalez-Colon and Members of the 
Subcommittee, thank you for the opportunity to testify today regarding 
the need for affordable and reliable energy sources in the U.S. Insular 
Areas. My name is Gregory Guannel, and I am the Director of the 
Caribbean Green Technology Center at the University of the Virgin 
Islands (cgtc.org).
    The U.S. territories of the U.S. Virgin Islands (USVI), Guam, 
American Samoa, and the Commonwealth of the Northern Mariana Islands 
(CNMI) are small islands, far from the mainland, who experience a host 
of natural disasters on a regular basis. These islands, which are 
important for national security and identity, are also small markets, 
who depend on dedicated and complex supply chains to bring most of the 
resources they need to function. They must import their fuel sources at 
a relatively high cost, and operate their electricity generation, 
transmission and distribution systems without the ability to tap into 
larger electricity markets or extra human capacity when issues arise. 
As a result, any generation or distribution issue (mechanical failure, 
computer failure, natural hazards, etc.) turns into an outage or 
blackout for residents. Moreover, they have some of the highest 
electricity costs in the nation, ranging between $0.35 to $0.47 per 
kWh, compared to a U.S. average of around $0.15 per kWh. Calculations 
from the Caribbean Green Technology Center at the University of the 
Virgin Islands, nearly 50% of the population of the USVI has a high 
energy burden, paying more than 6% of their annual income on 
electricity costs.\1\ The other pacific territories also have a high 
proportion of their population with similar high energy burden. Access 
to affordable power is a struggle for many and a drag on the economy.
---------------------------------------------------------------------------
    \1\ Statistics computed from USVI Water and Power Authority and 
from 2020 Census data (https://www.census.gov/newsroom/press-releases/
2023/2020-dhc-summary-file-usvi.html)
---------------------------------------------------------------------------
    Living with and adapting to disruptions is a normal part of life in 
the territories. Like in rural parts of the U.S. mainland, many 
residents of the territory must manage and maintain services that are 
taken for granted in many other places such as mail delivery, road 
maintenance, or wastewater and water management. For example, in the 
U.S. Virgin Islands, the public water system only serves 38% of the 
population, which means that 62% of residents depend on rainwater 
harvesting or wells, and must operate and maintain water pumps, 
pressure tanks and filtration systems to meet their household water 
needs. Residents have also adapted to electricity disruptions, which, 
according to the calculations of the Caribbean Green Technology Center, 
happen almost every other day in the USVI and that can last a few 
hours, a few days, or weeks. Most people own gas stoves instead of 
electric ones; gas dryers and water heaters are common; and many also 
own electric generators.
    However, living and adapting to frequent loss of power is becoming 
a bigger challenge. Access to power is becoming essential for many to 
function, and it is for some a matter of life and death. Electricity, 
and the technology it powers, is critical to conduct business; to 
communicate and receive information as we depend on cell phones and 
internet; to pump water out of cisterns and wells and access water; to 
keep food and medicine cold; etc. Last year, CNMI declared a state of 
emergency as they struggled to provide power for days to their 
residents after the failure of some of their generating capacity. 
Earlier this year, commerce almost came to a standstill in American 
Samoa after a long blackout. Cash machines, cash registers, supply 
management, credit card transactions: all economic activity depends on 
having electricity. After hurricanes Irma and Maria, hospitals and 
clinics in Puerto Rico and the Virgin Islands struggled to provide care 
to patients without access to power. Last year, many members of the 
military and their families stayed in the dark without power for days 
in Guam after typhoon Mawar hit them. And last summer, Puerto Rico 
experienced blackouts for many days because demand for power was so 
high during their heat wave. Access to electricity is critical 
especially older populations whose number is rising in the territories: 
breathing machines, wheelchairs, fridges for medicine, safety 
lightning. All these depend on a dependable and sustained supply of 
electricity.

    Ensuring that all residents of the U.S. territories have access to 
reliable power is critical and essential. Following hurricane Irma and 
Maria that hit the U.S. Virgin Islands in 2017, Dr. Alison Bates, Mr. 
Pagan Quinones and I conducted a series of surveys and interviews on 
energy issues with residents. The results of this study, which are 
currently under review in an academic publication, showed that reliable 
access to electricity is discussed as a matter of survival. Below are 
some excerpts from our interviews:

        ``We have finally learned the importance of having a secure 
        grid. Without a grid that can handle these enormous stormsthat 
        we know will come, without being able to survive a storm and 
        get back up immediately after a storm, there's no future for 
        this island.''

        ``The most important thing is--reliability [laughs]. We have an 
        issue with constant power on the islands. For instance, 
        yesterday St. Thomas--once St. Thomas loses power--St. John 
        loses power. Automatically. It's one system. Um, so you could 
        have times during the month, at least once or twice a month 
        guaranteed we're going to lose power. So you have people who 
        have health issues, medicine . . . food, and that's just during 
        a month to month basis where you are going to lose power. So I 
        feel we need to have something more sustainable and reliable.''

        ``What is important to me is actually to have power all the 
        time. Uh, I would gladly pay another 5, 10 cents a kilowatt if 
        I could be guaranteed that we had power all that time, 24/7, no 
        interruption. Because it--it is the interruptions that are 
        ruining the economy, it's not the price of power as far as I'm 
        concerned.''

    And as the Caribbean territories are facing another summer of 
extreme heat, it is imperative that we change the way we think about 
power production, delivery and management. Given the critical 
importance that electricity plays in our lives, we must adopt 
technologies that make adaptation to disruptions easier and simpler. 
Diesel or gasoline generators are useful, but can be dangerous if not 
properly operated, and are prone to malfunction: in the USVI, the 
waiting list for generator maintenance is many months. This is why 
access to solar power generation and batteries and even electric cars 
are so critical to residents and other stakeholders. From interviews 
conducted by Dr. Bates, Mr. Pagan Quinones and I, people mentioned how 
critical it was for them to have access to solar generated power after 
the 2017 hurricanes.

        ``Those who were not prepared paid the price. They either had 
        to live and wait for [the USVI Water and Power Authority] to 
        come back . . . people who had spent the money, and prepared, 
        were so much better off than the people that, well first of all 
        didn't have the inclination, but also didn't have the funds, to 
        secure their houses and secure their power, and their backup in 
        case [the utility] fails. They had a terrible time, but the 
        ones that we know, that were ready, and they were--they're 
        precious few, like us, who can get back up the next day.''
    But many cannot afford the upfront cost of investing in these new 
technologies.

        ``I think for me the main issue would be what would be the 
        startup cost for a normal working class family to be able to 
        switch over to renewable energy [solar] . . . it might be 
        cheaper in the long run, but almost always starting up is a big 
        investment and the regular working-class people can't afford to 
        give that lump sum at first but then we also can't afford to 
        live, to pay three hundred dollar bills of electricity a 
        month.''

    Programs from Federal Agencies (USDA, DOE, DOI, etc.) to assist 
island communities, rural communities, and isolated communities to 
access technologies like solar power and batteries, to modernize their 
electricity and transportation infrastructure, to build microgrids, and 
to ensure that all have access to affordable and reliable power 
especially in times of crisis are critical to their survival. These 
programs ensure, as one interviewee quoted above mentioned, that 
territories have a future. Accessing affordable and reliable energy 
sources means that businesses can finalize transactions, internet and 
conference calls are not interrupted, schools do not lose AC or lights, 
or hospitals can continue to serve patients.
    The case of rapid investment in alternate, decentralized sources of 
power in the United States goes beyond what we have observed or lived 
in the U.S. Territories. In the United States, the number of severe 
electrical outages has been steadily increasing since the early 2000s, 
as shown in Figure 1 from data published by the Office of 
Cybersecurity, Energy Security and Emergency Response of the Department 
of Energy and compiled by the Caribbean Green Technology Center at the 
University of the Virgin Islands. Last week, more than half a million 
people in the Northeast lost power after a series of storms. Many of 
these people probably share the same sentiments as those expressed in 
the territories when power goes out. And I'm sure that a few of them 
are now considering investing in alternate source of power to protect 
themselves in the future and ensure they have a reliable source of 
power.

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

    .epsFigure 1: Total number of severe electrical outages and number 
of outages due to natural hazards in the U.S. Causes of outages vary 
from equipment malfunction, operation issues, vandalism, cyber attacks 
or storms. Data Source: CERES (2024).\2\
---------------------------------------------------------------------------
    \2\ Office of Cybersecurity, Energy Security and Emergency Response 
of the Department of Energy (CERES) https://www.oe.netl.doe.gov/
OE417_annual_summary.aspx; Accessed April 9, 2024.

    Access to electricity is critical to life as we live it now. The 
U.S. Territories, where Americans who provide critical cultural, 
economic and security services to our country live, have and will 
continue to thrive in an environment where disruptions and adaptation 
are a way of life. Nevertheless, investments and grants from Federal 
Agencies to increase the portfolio of energy sources and solar in 
particular make a difference and increase our overall resilience: they 
make access to electricity affordable and reliable. These programs are 
also a way to showcase American engineering and technologies in regions 
where foreign entities like China are aggressively making investments 
and offering their energy services.
    In order to ensure our most distant territories do not become our 
weakest national security and economic links we need to:

     ensure like programs like Energizing Insular Communities 
            continue to fund resilience activities in the U.S. 
            Territories, such as increasing the construction of 
            microgrids or purchasing large solar systems for critical 
            infrastructure systems,

     provide opportunities for residents to invest in their own 
            electricity generation and storage technologies like solar 
            modules and batteries,

     increase the presence, technical assistance of Federal 
            Agencies and the Department of Energy in particular to 
            insular areas in the wider Pacific and Caribbean regions.

                                 ______
                                 

Questions Submitted for the Record to Dr. Guannel, Director, Caribbean 
                        Green Technology Center

Dr. Guannel did not submit responses to the Committee by the 
appropriate deadline for inclusion in the printed record.

            Questions Submitted by Representative Westerman

    Question 1. Power outages and the lack of reliable energy is a 
concerning reality felt by residents of the U.S. territories. 
Hurricanes Irma and Maria tore apart solar panels and left residents 
without power for weeks.

    Would you agree that it is important for the Insular Areas to have 
access to reliable and cost-effective energy?

    Question 2. In your testimony, you said that solar energy would 
make electricity affordable, however solar energy requires more 
transmission spending than traditional energy sources such as oil and 
gas. Solar often comes at the price of needing backup capacity such as 
gas or hydro. How then, do you rationalize solar energy being 
affordable?

                                 ______
                                 

    Ms. Hageman. Thank you, Mr. Guannel, for your testimony.
    The Chair now recognizes Mr. Fisher for 5 minutes.

STATEMENT OF TRAVIS FISHER, DIRECTOR, ENERGY AND ENVIRONMENTAL 
         POLICY STUDIES, CATO INSTITUTE, WASHINGTON, DC

    Mr. Fisher. Thank you, Chairman Hageman, Ranking Member 
Leger Fernandez, and distinguished members of the Subcommittee. 
I am Travis Fisher. I am the Director of Energy and 
Environmental Policy Studies at the Cato Institute, a non-
partisan public policy research organization in Washington, DC. 
It is an honor to be invited to speak with you today about the 
reliability and affordability of electricity in the United 
States.
    In every part of the country, the power grid should be an 
asset to American prosperity, but policymakers have wounded our 
grids with subsidies, regulations, and mandates. Across the 
United States, the power grid is straining under two 
significant pressures: decades of unwise policy on the one 
hand, and the resurgence of electricity demand growth on the 
other. We must keep all energy resources on the table, 
including fossil fuels, if we want our grids to be affordable 
and reliable.
    The Biden administration has said it wants the United 
States to use 100 percent CO2-free electricity by 
2035 to tackle the climate crisis, which it views as an 
existential threat. In my opinion, the bigger threat to 
Americans comes not from climate change but from overzealous 
central planners who will cause an energy crisis.
    For example, forcing the U.S. insular areas to abandon 
fossil fuels would put these areas at risk of price spikes and 
blackouts. Getting rid of fuels like coal, oil, propane, and 
natural gas means relying more heavily on intermittent 
resources, like wind and solar, and building large battery 
systems to back them up. Increasing costs should be a non-
starter in low-income areas. Using batteries to convert solar 
energy into a reliable resource increases its cost by more than 
three-fold.
    All technologies have a role to play, but forcing a 
transition to weather-dependent resources is especially unwise 
in the face of climate change. Think about it, if we expect 
extreme weather to be a growing problem going forward, then why 
should we make our electricity systems weather dependent? Along 
those lines, I want to highlight three major Federal policies 
that hurt grid reliability and affordability. Although most of 
my work covers the mainland, these concerns apply to the 
insular areas, too.
    First is a set of production tax credits in the Inflation 
Reduction Act, or IRA. These could cost American taxpayers $3 
trillion by 2050. These tax credits reward electricity 
production from unreliable resources and speed up the 
retirement of reliable power plants. The result is a weaker and 
more expensive grid over time, not to mention a deepening 
fiscal crisis for the country.
    Second is the tailpipe emissions rule from the 
Environmental Protection Agency, or EPA. This is a defective 
mandate for electric vehicles. The final rule seeks to ensure 
that by 2032 about two-thirds of new vehicles sold will be 
electric. This rule not only limits American's choice of 
vehicles but it also places immense stress on the power grid.
    Third is the proposed power plant rule from the EPA. This 
proposed rule mandates two technologies that are not adequately 
demonstrated as the statute says, which are carbon capture and 
green hydrogen. The EPA says carbon capture and green hydrogen 
are adequately demonstrated because they are adequately 
subsidized by the IRA.
    If you take these together, these policies mean more demand 
on the grid and less reliable supply. The predictable result is 
higher power bills and increased risk of blackouts for 
electricity customers everywhere.
    Hawaii offers a stark reminder of the dangers of a forced 
energy transition in an island setting. In Hawaii, anti-coal 
public policies drove the closure of the state's last coal-
fired power plant. In practice, the replacement energy has come 
from more expensive oil-fired power plants along with solar and 
battery systems. Grid reliability suffered.
    In January of this year, over 100,000 Hawaiians faced 
rolling blackouts because the energy system was not resilient 
to bad weather. The immediate cause was a severe rainstorm, but 
the underlying lack of energy security came from policymakers. 
It was policymakers who decided that Hawaii's energy resources 
should be dependent on the weather.
    The American people want reliable and affordable 
electricity and policymakers should listen. The energy crisis 
can be stopped because it is being driven by unwise policies 
and we can reform them. If we keep all energy options on the 
table, we can ensure reliable and affordable energy for the 
U.S. insular areas.

    [The prepared statement of Mr. Fisher follows:]
      Prepared Statement of Travis Fisher, Director of Energy and 
              Environmental Policy Studies, Cato Institute

    Chairman Hageman, Ranking Member Fernandez, and distinguished 
members of the subcommittee:
    Thank you for the opportunity to testify on the reliability and 
affordability of America's electrical grid. The Cato Institute is a 
nonpartisan public policy research organization dedicated to the 
principles of individual liberty, limited government, free markets, and 
peace. I am the Director of Energy and Environmental Policy Studies at 
Cato, and my research focuses on the economics and reliability of 
electricity, the role of free markets in improving the availability and 
affordability of energy and natural resources, and environmental 
regulations that impact the energy sector.
    I commend you for examining the impacts of public policy on the 
reliability and affordability of America's power grids, especially in 
the U.S. Insular Areas.
Executive Summary

    Americans depend on a strong energy infrastructure for our health 
and well-being, and the electrical grid is the most important--and 
fragile--piece of energy infrastructure we have. Unfortunately, power 
grids across the country are damaged by public policies at nearly every 
level of government.
    The stakes for policymakers are high, and the impacts of flawed 
energy policies are coming into starker focus every day. For example, 
Hawaii's forced energy transition began to show signs of strain in 
January of this year when the local utility was unable to meet demand 
for several hours during a rainstorm.
    During extreme weather, Americans need reliable electricity to 
survive. Day to day, we need reliable and affordable electricity to 
thrive and grow.
    The power grid should be an asset to American prosperity, but 
policymakers--through a multitude of subsidies, regulations, and 
mandates--have wounded it to the point that it is now becoming a 
dangerous liability.
I. Reliable and Low-Cost Electricity is Essential

    At the turn of the millennium, the National Academies of 
Engineering ranked the electric grid the greatest engineering 
achievement of the twentieth century.\1\ The main criterion for 
selection was how much an achievement improved people's quality of 
life. Access to reliable electricity improves the quality of life of 
every American.
---------------------------------------------------------------------------
    \1\ Wm. A. Wulf, Great Achievements and Grand Challenges, National 
Academy of Engineering, Sept. 1, 2000, https://www.nae.edu/7461/
GreatAchievementsandGrandChallenges

    There is a clear nexus between the affordability of electricity and 
energy security at the household level. A recent Congressional Research 
Service (CRS) report on electric utility disconnections highlighted the 
hardships and threats to energy security faced by many American 
---------------------------------------------------------------------------
families:

        ``Researchers estimate that approximately 1% of households are 
        disconnected each year. Broader measures of energy insecurity 
        (e.g., foregoing other necessary expenses like food or 
        medicine) are higher, with approximately 30% of American 
        households experiencing some form of energy insecurity. Black 
        and Hispanic households appear more likely to be disconnected 
        than non-Hispanic White households. For many American families, 
        electric utility disconnections are the most significant threat 
        to energy security.'' \2\
---------------------------------------------------------------------------
    \2\ U.S. Congressional Research Service, Electric Utility 
Disconnections, January 31, 2023, https://crsreports.congress.gov/
product/pdf/R/R47417

    Data compiled by CRS highlight the affordability challenge: ``The 
share of Black households experiencing energy insecurity is about twice 
as high as that for White households (52% compared to 27% in 2020). 
Similarly, the share of Hispanic or Latino households experiencing 
energy insecurity is about twice as high as that for households that 
are not Hispanic or Latino (47% compared to 25% in 2020).''
    In the U.S. Insular Areas--which have electricity rates \3\ and 
poverty levels \4\ that are well above the mainland U.S. average--
access to affordable energy is an even greater challenge. Grants 
seeking to move Insular Areas away from fossil fuels will: 1) not 
meaningfully impact the global climate given their small greenhouse gas 
footprints and 2) exacerbate the energy insecurity of these areas by 
limiting their primary energy sources to intermittent, weather-based 
resources like solar and wind.
---------------------------------------------------------------------------
    \3\ U.S. Energy Information Administration, American Samoa 
Territory Energy Profile, (stating that ``Electricity prices in 
American Samoa vary with world petroleum prices. In 2022, the 
territory's average electricity price was almost 45 cents per 
kilowatthour, about 3.6 times higher than the U.S. average''), accessed 
on April 9, 2024, https://www.eia.gov/state/print.php?sid=AQ
    \4\ U.S. Census Bureau, 2020 Island Areas Censuses: American Samoa 
(showing that over 50 percent of families in American Samoa live below 
the poverty line), accessed on April 9, 2024, https://data.census.gov/
table/DECENNIALDPAS2020.DP3?g=040XX00US60&d=DECIA%20 
American%20Samoa%20Demographic%20Profile&tid=DECENNIALDPAS2020.DP3
---------------------------------------------------------------------------
II. Energy Policies Are Undermining Reliability and Affordability

    Under a reasonable set of regulations, electricity suppliers will 
rise to meet challenges and deliver low-cost, reliable electricity to 
consumers across the United States. However, energy and environmental 
policies are creating predictable problems with grid reliability and 
affordability.
    Last year, for the first time ever, NERC identified energy policy 
as a leading risk factor for electric reliability.\5\ In NERC's 2023 
ERO Reliability Risk Priorities Report, the energy transition--
specifically the changing resource mix--tops the risk rankings.
---------------------------------------------------------------------------
    \5\ Robert Walton, NERC Assessment Identifies New Risk to Grid 
Reliability: Energy Policy, Utility Dive, Aug. 23, 2023, https://
www.utilitydive.com/news/nerc-assessment-new-risk-grid-reliability-
energy-policy/691590/

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


    .epsThe reliability impacts on island systems could be more 
profound than the impacts on mainland systems. That is because smaller, 
islanded systems already face much lower levels of system inertia. In 
other words, energy policies that force the shutdown of high-inertia 
generators (such as large thermal plants fueled by hydrocarbons) place 
an outsized risk on island systems. Observers have been aware of the 
---------------------------------------------------------------------------
problems associated with inertia-less solar power for quite some time.

        ``Especially in island grids which already have a lower inertia 
        than large interconnected systems, the frequency response will 
        be highly deteriorated when conventional generation is replaced 
        by solar or wind power.'' \6\
---------------------------------------------------------------------------
    \6\ Pieter Tielens and Dirk Van Hertem, Grid Inertia and Frequency 
Control in Power Systems with High Penetration of Renewables, January 
2012, https://lirias.kuleuven.be/bitstream/123456789/345286/1/
Grid_Inertia_and_Frequency_Control_in_Power_Systems_with_High_ 
Penetration_of_Renewables.pdf

    In addition to minute-by-minute grid frequency challenges, forced 
retirements of thermal generation can also cause problems with 
aggregate electricity supply, commonly called resource adequacy. A lack 
of resilient supply caused more than 100,000 Hawaiians to lose electric 
service during a rainstorm in January of this year.\7\ Blackouts and 
cost increases should not be the norm in America, yet policymakers 
continue to set the stage for both.
---------------------------------------------------------------------------
    \7\ Keli'i Akina, Ph.D., Are rolling blackouts the price Hawaii 
must pay for clean energy?, Grassroot Institute of Hawaii, January 13, 
2024, https://www.grassrootinstitute.org/2024/01/are-rolling-blackouts-
the-price-hawaii-must-pay-for-clean-energy/
---------------------------------------------------------------------------
    Regarding cost increases, utility officials warned that the closure 
of Hawaii's last coal-fired power plant would increase electricity 
rates because ``oil-generated power costs as much as five times more 
than coal.'' \8\ Oil-generated electricity may not always be so much 
more expensive than coal-generated electricity, but it is well known 
that oil markets are significantly more volatile than coal markets. 
Closing the door on coal and forcing island communities to get by on 
other resources clearly cuts against the goal of ensuring a reliable 
and affordable grid.
---------------------------------------------------------------------------
    \8\ Gina Mangieri, Power cost hike, supply crunch ahead as last 
Hawaii coal plant closes, KHON2, June 24, 2022, https://www.khon2.com/
always-investigating/power-cost-hike-supply-crunch-ahead-as-last-
hawaii-coal-plant-closes/
---------------------------------------------------------------------------
    Below is a snapshot of three public policies that pose a 
significant risk to reliable, secure, and affordable electricity on the 
mainland and in the U.S. Insular Areas.
A. The Inflation Reduction Act Weakens the Grid with Subsidies

    The Inflation Reduction Act (IRA) threatens to undermine the well-
functioning of the power grid by flooding it with subsidized, 
intermittent energy. One inescapable fact of the electricity industry 
is that dispatchable resources are necessary to match supply with 
demand and keep the grid energized at all times.\9\ By providing 
unlimited amounts of subsidies to intermittent resources like wind and 
solar energy, the IRA erodes the economics of dispatchable resources.
---------------------------------------------------------------------------
    \9\ Jeff Turcotte, An Electrified Economy Needs Dispatchable 
Generation: EPSA's Takeaways From the White House Electrification 
Summit, Electric Power Supply Association, Dec. 21, 2022, https://
epsa.org/an-electrified-economy-needs-dispatchable-generation-epsas-
takeaways-from-the-white-house-electrification-summit/
---------------------------------------------------------------------------
    If we look beyond the 10-year budget window, the cost of the IRA 
credits could increase and remain high for years, perhaps indefinitely. 
That is because the ``applicable year'' when the production tax credit 
(PTC) in the IRA is supposed to phase down is triggered by an 
impossible-to-meet greenhouse gas (GHG) reduction target. Specifically, 
GHG emissions in the electricity sector must fall to 25 percent of 
their 2022 level for the PTC to begin to phase down.
    The total cost of energy credits in the IRA is an unstable number 
with no reasonable cap. Note that the target in the IRA is a GHG 
emissions level rather than a GHG intensity. The U.S. Energy 
Information Administration (EIA) analyzed electricity sector GHG 
emissions in the IRA reference case (and in the no-IRA case) and found 
neither case to hit the ``applicable year'' target by 2050. Hence, the 
IRA subsidies are set to pile up for decades, potentially reaching $3 
trillion in just the PTC alone.\10\
---------------------------------------------------------------------------
    \10\ Travis Fisher, The Inflation Reduction Act's Energy Subsidies 
Are More Expensive Than You Think, Cato Institute, Sep. 5, 2023, 
https://www.cato.org/blog/iras-energy-subsidies-are-more-expensive-you-
think
---------------------------------------------------------------------------
    The distinction between a level-based and intensity-based target 
matters because electricity demand is growing, making the IRA targets 
even harder to hit. The chart below assumes GHG emissions targets will 
be hit around the year 2050.\11\ It is an illustrative example of how 
large the IRA subsidies could be. To be clear, I do not believe the GHG 
emissions targets in the IRA will be met by 2050.
---------------------------------------------------------------------------
    \11\ Ryan Sweezey, The Indefinite Inflation Reduction Act: Will Tax 
Credits for Renewables Be Around for Decades?, Wood Mackenzie, Mar. 8, 
2023, https://www.woodmac.com/news/opinion/IRA-tax-credits-for-
renewables/

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


    .epsAs discussed below, the IRA also enables the Environmental 
Protection Agency (EPA) to claim certain unproven technologies are 
adequately demonstrated when, in fact, they are merely adequately 
subsidized. Thus, the IRA forms the basis of the EPA's Best System of 
Emission Reduction (BSER). Basing permanent rulemakings on temporary 
budget reconciliation measures like the IRA is inappropriate.
B. EPA Regulations Hurt Reliability and Affordability

    The EPA's regulatory regime is laden with legal infirmities, 
conflicts of interest, and technical and economic problems. The 
proposed power plant GHG regulation--sometimes referred to as CPP 2.0 
because it's the second attempt at a Clean Power Plan--relies on 
technologies that have not been ``adequately demonstrated'' by any 
stretch of the meaning of that term.\12\ The proposal is so legally 
dubious that I am concerned the goal of the policy is to inject 
uncertainty in the planning and financing of hydrocarbon-based 
electricity generation rather than to enact a durable regulation.
---------------------------------------------------------------------------
    \12\ Editorial Board, EPA and Its Biden Administration Critics, 
Wall Street Journal, Feb. 21, 2024, https://www.wsj.com/articles/epa-
and-its-biden-administration-critics-fossil-fuel-carbon-tech-931eb26e
---------------------------------------------------------------------------
    As mentioned above, the energy subsidies in the IRA enable the 
EPA's overreach because they allow the EPA to set standards based on 
hypothetical deployment of highly subsidized resources. In the CPP 2.0 
proposal, EPA relied explicitly on the subsidies in the IRA to claim 
that the BSER technologies--carbon capture and storage (CCS) and low-
GHG hydrogen--are ``adequately demonstrated.'' \13\ A corollary of 
EPA's reliance on IRA subsidies is that, when fiscal realities demand a 
claw-back of IRA subsidies, the CPP 2.0 will have to be clawed back as 
well.
---------------------------------------------------------------------------
    \13\ Travis Fisher, How the Inflation Reduction Act Bankrolls EPA 
Overreach, Cato Institute, Oct. 9, 2023, https://www.cato.org/blog/how-
inflation-reduction-act-bankrolls-epa-overreach
---------------------------------------------------------------------------
    Assuming CPP 2.0 does not receive an immediate stay from the 
courts, its practical impact will be to greatly reduce the supply of 
electricity. Given that CCS is not commercially available at any useful 
scale, the only compliance option for owners of coal-fired power plants 
is to shut down. The same goes for natural gas-fired generators--low-
GHG hydrogen is at best very expensive and at worst unavailable. The 
inevitable result of the rule is the shutdown of a significant amount 
of reliable generation.
    The proposed tailpipe emissions standard, if found to be legal, 
will of course limit the choices Americans have in our vehicles, but it 
will also greatly increase the demand for electricity. That is because 
a significant amount of the energy needed for transportation will have 
to shift from being supplied by petroleum (gasoline and diesel) to 
being supplied by the power grid. In other words, the tailpipe rule 
will further increase demand growth, which is already accelerating.
    The result of reduced supply and increased demand is 
straightforward to predict: increased prices and, unfortunately, energy 
shortfalls. What that means for a typical electricity consumer is a 
higher power bill and an increased risk of blackouts.\14\ According to 
NERC, we are already in an elevated risk scenario. Hence any EPA 
proposal to force an increase in demand or a decrease in supply--
including the tailpipe rule and CPP 2.0--will further weaken an already 
fragile grid.
---------------------------------------------------------------------------
    \14\ Travis Fisher, Public Comment Re: New Source Performance 
Standards for GHG Emissions from New and Reconstructed EGUs, Docket ID 
No. EPA-HQ-OAR-2023-0072; FRL-8536-04- OAR; RIN 2060-AV09, Cato 
Institute, Dec. 20, 2023, https://www.cato.org/sites/cato.org/files/
2024-01/fisher-public-comment-12-20-23.pdf
---------------------------------------------------------------------------
III. EPA's Regulatory Impact Assessments Are Inadequate
    In the case of both the tailpipe rule and CPP 2.0, the EPA used a 
proprietary model developed by an outside consulting firm to estimate 
the impacts of the rules on the retail price of electricity. Although 
the price estimates are something of a black box, there are indications 
that the process is deeply flawed.
    The draft regulatory impact assessment for the tailpipe rule states 
that ``[r]egional average retail electricity price differences showed 
small increases or decreases (less than approximately 1 to 2 
percent),'' meaning that EPA's price model violates the law of supply. 
In no case should a rule that forces the rapid electrification of the 
transportation fleet--which represents a large increase in the demand 
for electricity--cause a reduction in prices.
    Regarding the price impacts of CPP 2.0, EPA finds that vastly 
reducing the supply of electricity generation would only increase 
retail electricity prices by 0.2% in 2035 on average.\15\ This is an 
implausible estimate made possible by a proprietary model. Why would 
the EPA not rely on the Energy Information Administration, an 
independent wing of the U.S. Department of Energy? The EIA is more than 
capable of modeling the cost impacts of CPP 2.0, as it showed when it 
modeled the cost impacts of the original Clean Power Plan using the 
National Energy Modeling System.\16\
---------------------------------------------------------------------------
    \15\ Ethan Howland, EPA proposes power plant greenhouse gas limits 
with carbon capture, `green' hydrogen main compliance options, Utility 
Dive, May 11, 2023, https://www.utilitydive.com/news/epa-ghg-carbon-
emission-limits-power-plants-carbon-capture-hydrogen/650039/
    \16\ U.S. Energy Information Administration, Analysis of the 
Impacts of the Clean Power Plan, May 2015, https://www.eia.gov/
analysis/requests/powerplants/cleanplan/pdf/powerplant.pdf
---------------------------------------------------------------------------
    The EPA could also inflate the estimated benefits of its own 
regulations. In both the tailpipe rule and CPP 2.0, the EPA is poised 
to use a greatly increased estimate of the Social Cost of Carbon 
Dioxide (SC-CO2) to justify its proposals. One fundamental 
problem (among others) is that the EPA is moving ahead of the 
Interagency Working Group process to update the SC-CO2 and 
instead using its own estimate. In other words, the EPA can print its 
own regulatory currency--the SC-CO2--to be used in 
justifying its own rules under the required cost-benefit analyses.
    As I wrote in formal comments to the EPA regarding CPP 2.0, the EPA 
should improve its rulemaking by offering an objective, unbiased 
assessment of the reliability and cost impacts.\17\ To that end, the 
EPA should issue a new supplemental notice seeking comment on the 
impact of the rule on the cost of electricity.
---------------------------------------------------------------------------
    \17\ Travis Fisher, Public Comment Re: New Source Performance 
Standards for GHG Emissions from New and Reconstructed EGUs, Docket ID 
No. EPA-HQ-OAR-2023-0072; FRL-8536-04-OAR; RIN 2060-AV09, Cato 
Institute, Dec. 20, 2023, https://www.cato.org/sites/cato.org/files/
2024-01/fisher-public-comment-12-20-23.pdf
---------------------------------------------------------------------------
IV. A Reliable and Affordable Grid Requires Less Government 
        Intervention

    As I see it, there are two starkly different paths forward 
regarding electricity policy. The first, which I endorse, is to embrace 
American values and foster an electricity industry that is built on 
fierce competition to serve consumers. The second, which I fear is 
taking hold presently through the IRA and EPA rules discussed above, is 
to force an unwise transition to politically favored, intermittent 
resources.
    Intermittent resources such as wind and solar energy should be 
allowed to take their rightful place in electricity systems. Congress 
should remove the IRA subsidies (along with all energy subsidies, 
including subsidies for hydrocarbons and nuclear energy) to encourage 
right-sized investments in energy resources that leave electricity 
customers and federal taxpayers better off. The IRA will force 
significant amounts of intermittent energy onto the grid--far more than 
would be consistent with the goal of ensuring a reliable grid at least 
cost to consumers and taxpayers. At the same time, the EPA is 
recklessly shutting down reliable generation.
    Rather than allowing an energy crisis of their own making to 
unfold, policymakers should foster a reliable, low-cost grid that 
provides a solid foundation upon which to build a strong and growing 
American economy. The way to ensure a robust grid is simply to remove 
the harm inflicted by unwise energy policy.
    Finally, I urge policymakers to show restraint and humility when 
interfering with the electric power sector. Policymakers have important 
decisions to make about America's energy future, and it is vital that 
members of Congress and other policymakers first do no harm. As NERC 
has noted, ``[e]ducation for policymakers and regulators to increase 
awareness of the reliability implications of policy decisions is a 
critical need.'' \18\
---------------------------------------------------------------------------
    \18\ North American Electric Reliability Corp., 2023 ERO 
Reliability Risk Priorities Report, Aug. 2023, p. 21, https://
www.nerc.com/comm/RISC/Related%20Files%20DL/RISC_ERO_Priorities_ 
Report_2023_Board_Approved_Aug_17_2023.pdf
---------------------------------------------------------------------------
    Thank you for the opportunity to provide testimony on the critical 
issue of the reliability and affordability of America's electric grids.

                                 ______
                                 

 Questions Submitted for the Record to Mr. Travis Fisher, Director of 
        Energy and Environmental Policy Studies, Cato Institute

Mr. Fisher did not submit responses to the Committee by the appropriate 
deadline for inclusion in the printed record.

            Questions Submitted by Representative Westerman

    Question 1. The territories pay on average two to three times what 
states pay for their utilities. There are concerns that prioritizing 
renewable energy would cause utility prices to go up even higher in the 
territories.

    Do you have an estimate on the impact of renewable energy 
transition has on utility prices here in the U.S.?

    Question 2. Why does the transition to renewables drive up the 
utility costs for Americans?

    2a) Would it be fair to say that the transition to renewables would 
further increase utility costs for the territories?

    2b) Would it also be fair to say that allowing for the territories 
to have self-determination through an all-of-the-above energy approach 
would help drive down energy costs?

    Question 3. Do you believe there are economic drawbacks of 
prioritizing renewable energy in the territories? And if so, what do 
you think those are?

         Questions Submitted by Representative Leger Fernandez

    Question 1. California recently achieved an historic milestone of 
producing enough energy from renewable sources to meet 100% of consumer 
demand for 31 days (and counting, as of April 16, 2024). If such an 
achievement is possible in California, which has significantly higher 
energy demand than any of the U.S. Territories, why should we not 
invest in helping the territories reach their renewable energy 
generation targets?

                                 ______
                                 

    Ms. Hageman. Thank you, Mr. Fisher, for your testimony.
    I am now going to recognize the Members for 5 minutes of 
questioning, and I am going to begin with Mr. LaMalfa.
    Mr. LaMalfa. Thank you, Madam Chairman, for convening the 
hearing, thanks for being recognized, and panelists for your 
time with us here today.
    I am going to start right at the top. Panelists, each one 
of you please, what is your estimate of the percentage of 
carbon dioxide in our atmosphere? What percent of our 
atmosphere is made up of carbon dioxide? Please just run down 
the line at your best estimate.
    Mr. Fisher. I will start with 0.42 percent, 420 parts per 
million.
    Mr. LaMalfa. OK. Anybody else? Three others. I want 
answers, please. What do you think it is?
    Mr. Fisher. So, .042 percent. I got the decimal wrong.
    Mr. Stein. Yes, .04 percent.
    Mr. LaMalfa. Is that a consensus of all five of you, .042?
    Mr. Fleming. I don't have a counter statement to that, so I 
would align.
    Mr. Brewer. No idea, Congressman.
    Dr. Guannel. That is fine.
    Mr. LaMalfa. OK. All right. Well, thank you. I always like 
to start out these climate change and CO2 greenhouse 
gas conversations with where are we starting, so I got two 
actually very correct answers. I appreciate that. A typical 
response is somewhere between 20 and 50 percent by the person 
on the street who is busy with their lives and such. So, that 
is our baseline, .04 percent of our atmosphere is 
CO2, yet we are hellbent in this country and other 
western countries to somehow get rid of our energy grid and our 
way of life to accomplish trying to bend that number just a 
little bit lower when you can hardly even find it on a chart.
    As this applies to our Committee work and our insular 
affairs here, I did have a chance to visit Puerto Rico and look 
at their generating plant there. It is antiquated, an old 
diesel set up there. I am sure they gladly have it rather than 
nothing. But upgrading and moving in a different direction 
would be forward thinking for all these entities, all the 
island areas that have unique challenges with keeping a grid 
going and up to speed.
    Interestingly, I saw a piece by Toyota today, and Mr. 
Toyota with quotes in the past when he was talking about the 
way forward is not electric vehicles. And they had an equation, 
the 1:6:90 rule, maybe you have heard of that. But for every 
one electric car, fully electric car that you can build, the 
amount of minerals and special metals needed to do that, you 
can make six plug-in hybrid electric cars or 90 regular hybrid 
cars.
    So, we are hellbent on forcing people into electric cars 
with minerals and metals that aren't even available, and we 
don't even permit mines in this country in order to get the 
materials we need, they all have to be imported. Yet, you hear 
you could build 90 hybrid vehicles for what it takes to build 
one, and that is from Toyota. So, we are applying this same 
kind of thinking towards forcing ourselves into the type of 
power plants that would put us in a similar vein.
    And I love the analogy on weather dependent because we just 
saw that in Texas, where a weather dependent grid there got 
knocked out by a hail storm. And the eclipse might be a fun 
example, all of our solar technology was diminished for a few 
minutes there amongst all the other crises that came out during 
the hysteria over an eclipse.
    Let me throw a couple questions here quick to Mr. Fisher 
and Mr. Stein. Can you highlight some more of the advantages of 
non-renewable sources like liquified natural gas from the 
United States, which we produce abundantly, or when you are 
talking the island regions way down there in the South Pacific 
that maybe even are a regional ally and shipping advantage 
would have in supplying gas to the islands there versus weather 
dependent and unreliable sources like wind and solar? Let me 
throw that first to Mr. Fisher and then Mr. Stein on deck.
    Mr. Fisher. It is a great question. The short answer is you 
have more portability in liquid fuels for sure and LNG as well, 
you have more ability to store the fuel, and probably the main 
advantage is it is controllable. In the sense of the eclipse, 
we had no control over where the moon was in that moment. We do 
have control over a unit that you can simply fire up or turn 
off.
    Mr. LaMalfa. A stationary fuel source that you can control 
24/7. Mr. Fisher?
    Mr. Fisher. Yes. And as I said in my testimony, I think 
that LNG, it is only just today, within the last year or two, 
where LNG has even theoretically become an option because of 
the growth in LNG exports around the world. So, it is something 
that in the past has never even been considered because it 
wasn't really a realistic option, and I think that is why it is 
very important to not reject that for ideological reasons. As I 
said, Australia is one of the largest producers of LNG for 
export in the world and the South Pacific territories are 
actually located in an excellent location to take advantage of 
that.
    Mr. LaMalfa. So, low cost 24/7 available power sources that 
you can control yourself. Yep. All right.
    Madam Chair, let's not forget small modular nuclear 
reactors could be ideal in the right setting, too. I will yield 
back, Madam Chair. Thank you.
    Ms. Hageman. Thank you. The Chair now recognizes Ms. Leger 
Fernandez, the Ranking Member.
    Ms. Leger Fernandez. Thank you so much. And I would point 
out that it strikes me that we have two witnesses on the panel, 
leaving aside the government, who actually live in the islands, 
who actually have lived through the typhoons or hurricanes that 
you have described in your testimonies as suffering at more 
disastrous impacts because of climate change. I find that 
testimony incredibly valuable.
    I also find incredibly valuable the fact that two witnesses 
who actually are on the ground running utilities, running the 
energy companies that your communities rely on are advocating 
for diversifying the energy sources. And I am hearing from you 
that you want to see diversification. You are not saying we 
want to eliminate anything altogether, but you want to see some 
diversity.
    And, Dr. Guannel and Mr. Fleming, you point out the 
importance of microgrids, the importance of bringing solar and 
perhaps wind in to bring down the cost. Am I understanding that 
correctly that you see this as important to both the economic 
prosperity of your islands but also very important with regards 
to health and everything that you rely on? Can you just 
describe real quickly why you think that that diversification, 
those microgrids are important? I will go first to Dr. Guannel.
    Dr. Guannel. Yes. We believe that it is actually very 
important, and I can speak for myself and many of the residents 
of the Virgin Islands. Diversification is critical because most 
islands in the territories only have one power plant. If the 
power plant goes down, nobody has power regardless of what is 
going on. If the distribution system has a problem, sometimes 
they turn off the entire system just to protect it.
    So, the ability for people to have access to electricity is 
critical. It is not a question of do I think this, do I think 
that, it is a question of can I have the light on, can I live 
my life, and access to electricity is the issue. The advantage 
of solar is that it allows houses, communities to have access 
to this electricity without really thinking too hard about the 
intricacy of running a power plant.
    Many people purchase solar and make the investment because 
they know that, first of all, after 10 years or so, sometimes 5 
years, they no longer have to pay anything at all, and they 
continue to receive the benefit of the electricity being 
produced. When there is a problem, they have access to 
electricity.
    Ms. Leger Fernandez. Thank you.
    Dr. Guannel. Et cetera, et cetera. The issue is really 
access.
    Ms. Leger Fernandez. Thank you. So, the price actually then 
stabilizes for them so they are not subject to the fluctuations 
that we incur. I have a couple of more questions, but thank 
you.
    Mr. Fleming, if you could quickly answer the question with 
regards to the benefits of having the diversification, the 
solar and the wind.
    Mr. Fleming. Yes, so diversification is really at the core 
of everything that we look at from an energy standpoint in the 
territory. I think the term was used earlier, abandoning, and 
we are by no stretch abandoning our current need for thermal 
generation that is driven by fossil fuels. We are currently in 
the process of commissioning new, more efficient thermal 
generation on the island of St. Thomas. We are paving a path 
for establishing efficient generation on St. Croix as well, 
because we are currently operating antiquated, legacy, 
inefficient generation, so realizing our dependence on fossil 
fuels in parallel with our growing penetration of renewables, 
we still need to have an efficient baseload because that is how 
we actually maximize the diversification with the additional 
renewables.
    And I will highlight one project specifically tied directly 
to the OIA. We recently commissioned a microgrid at an 
emergency shelter on St. Croix. This was the largest emergency 
shelter on St. Croix which was funded through Energizing 
Insular Communities Grant which incorporates solar, battery, 
and a diesel gen set on site.
    Ms. Leger Fernandez. Thank you very much.
    I just want ask Mr. Brewer, do you pick winners and losers?
    Mr. Brewer. Thank you, Congresswoman. No, ma'am, we don't. 
The EIC program follows the priorities set by the territories. 
They are in the lead. They set their priorities and then they 
share those priorities with us, and then we are able to, based 
on our criteria, see how they qualify for the EIC program, and 
those that qualify for the program receive the grants.
    Ms. Leger Fernandez. Right. My time is up, but I like the 
fact that the answers have actually told us that the people in 
the territories, at least what we are hearing today, they are 
asking for this and you are responding to that.
    With that, Madam Chair, I yield back.
    Ms. Hageman. The Chair now recognizes Mr. Sablan for 5 
minutes of questioning.
    Mr. Sablan. Thank you, Madam Chair, and welcome to all the 
witnesses. I am trying to figure out how differences with the 
Biden administration energy plans, which I support, have become 
a subject of the territories.
    Mr. Brewer, welcome, and I want to thank your office and 
the Department of the Interior for your support of the 
Energizing Insular Communities Program that helps the insular 
areas reduce our reliance on expenditures on imported fuels and 
move towards developing and utilizing domestic energy sources.
    As you note in your testimony, residents in the territories 
face steep challenges to meet energy needs due to remote 
geographies that need to import fuel and the constant threat of 
natural disasters, particularly powerful storms that are 
becoming more damaging and more frequent. This leads to energy 
rates in the insular areas that are an average of two-and-a-
half times greater than rates in the mainland, and electricity 
rates for residential customers in my district, the Northern 
Mariana Islands, is regularly over 40 cents per kilowatt hour. 
The Majority claims that the Biden administration through the 
Department of the Interior is pushing the insular areas toward 
solar, wind, and other sources of clean renewable energy. 
Biden's One Energy they are calling it.
    Mr. Brewer, please know that if you were going to issue 
grants that don't support renewable energy, you are going to be 
violating the law, won't you?
    The law is intended to assist the insular areas in 
developing and implementing plans to move the insular areas 
away from their reliance on costly imported fuels to cheaper 
domestic sources of energy. That is the law, Public Law 109-59 
and 113-235. I don't know what we are arguing here. I don't 
think you violated the law.
    Mr. Brewer. Congressman, thank you. A couple of points. Let 
me be clear, there is no language in the EIC that precludes a 
territory from applying for funding from any source.
    Mr. Sablan. Right. No, I understand that.
    Mr. Brewer. There is no source that is----
    Mr. Sablan. But it moves the insular, the territories, it 
moves them, assists them to develop and implement plans to move 
away from fossil fuels because I don't have fossil fuels in the 
Northern Marianas, but we have the sun.
    Mr. Brewer. If the CNMI energy plan has given priority for 
solar energy, wind, whatever form of energy that it has seen as 
a priority for its energy plan, and it provides that to our 
office as what it wants to possibly fund through the EIC, that 
is what we would use our criteria to evaluate.
    Mr. Sablan. OK. Maybe you are not an expert, but we have 
today's readily available technology. What is the most 
efficient way to produce electricity? The most efficient way to 
produce electricity is solar.
    Mr. Brewer. I am afraid, sir, that that is outside of my 
area of expertise.
    Mr. Sablan. Oh, all right. Well, it is solar, if not for 
the nation, then I know for the Northern Marianas. I live 
there, I pay my utility bills every month. No one else does it 
for me. And it is expensive for me. I can just imagine those 
other people, those who fall at or below the $17,000 GDP.
    Please, you have an issue with the Biden administration 
energy plans, take it to the Biden administration energy plans. 
This program is helping the people in the insular areas move to 
something that they can afford. $15 million a year, you guys 
want to bitch about that?
    I yield back.
    Ms. Hageman. The Chair now recognizes Ms. Velazquez for 5 
minutes of questioning.
    Ms. Velazquez. Thank you, Madam Chair.
    Mr. Brewer, when it comes to asserting its military 
presence, the United States does not hesitate to invest in the 
territories. For decades, Guam has been almost entirely 
dominated by the Department of Defense. Further, only two 
decades ago, Puerto Ricans, including myself, were fighting to 
stop the military from using Vieques as a bomb testing ground.
    I have seen how our communities have been occupied, 
contaminated, and become sicker. In fact, Madam Chairman, I 
request that today's front page article of El Nuevo Dia, Puerto 
Rico's largest newspaper, which states that 4 out of 10 Puerto 
Ricans will get diagnosed with cancer at least once during 
their lifetime. I ask unanimous consent for that to be 
submitted for the record.

    Ms. Hageman. Without objection.

    [The information follows:]

Cuatro de cada 10 personas en Puerto Rico padeceran de cancer en algun 
momento de sus vidas

La mediana de edad de los diagnosticos es a los 67 anos, pero cada vez 
hay mas casos en jovenes

elnuevodia.com, 10 de abril de 2024, Por Marga Pares Arroyo

https://www.elnuevodia.com/noticias/locales/notas/cuatro-de-cada-10-
personas-en-puerto-rico-padecera-de-cancer-en-algun-momento/

                                 *****

Pese a que los adultos mayores son los mas vulnerables a un diagnostico 
de cancer, toda la poblacion en Puerto Rico esta en riesgo, ya que se 
estima que el 41.5% de las personas en la isla sufrira de esta 
enfermedad en algun momento de sus vidas.

Sin embargo, personas que estudian la enfermedad consultadas por El 
Nuevo Dia coinciden en que, a pesar de que aun es la segunda causa de 
fallecimientos en el pais, la deteccion y la atencion en una etapa 
temprana aumentan el nivel de supervivencia.

``Asusta un diagnostico de cancer, pero hay esperanza tambien porque 
cada vez mas personas lo sobreviven'', enfatizo la demografa Vivianna 
de Jesus Monge, investigadora cientifica de la Division de Control de 
Cancer y Ciencias de la Poblacion del Centro Comprensivo de Cancer 
(CCC) de la Universidad de Puerto Rico (UPR).

``Muchos conocemos a alguien que ha sobrevivido al cancer (tiempo 
despues del diagnostico), y eso hace que haya esperanza en la gente, 
que esa noticia de cancer no sea tan devastadora como antes'', anadio.

Datos del Registro Central de Cancer de Puerto Rico indican que la 
sobrevida de hombres con cancer de prostata, de 2012 a 2016, fue de 
99.7% a los cinco anos del diagnostico, mientras que, en cancer de 
tiroides, la supervivencia fue de 100% y, en mujeres con cancer de 
mama, de 86.8%.

``La sobrevivencia varia por el tipo de cancer y su estadio al momento 
del diagnostico. Si se coge en un estadio I y II, es mucho mayor (la 
sobrevida) que cogerlo, por ejemplo, en estadio IV, que, muchas veces, 
ya esta en metastasis (propagacion de las celulas cancerosas mas alla 
del tumor original)'', explico, por su parte, Maria Cristy, 
vicepresidenta de Servicios al Paciente de la Sociedad Americana Contra 
el Cancer de Puerto Rico.

Segun el Instituto Nacional del Cancer (NCI, en ingles), en Estados 
Unidos, el indice de supervivencia a cinco anos de todos los canceres 
combinados es de 68%.

La sobrevida o supervivencia en cancer es definida por el NCI como el 
tiempo que pasa desde la fecha del diagnostico o el comienzo del 
tratamiento en el cual los pacientes siguen vivos hasta que ha 
transcurrido un periodo que, habitualmente, se establece en cinco anos.

14,168 casos nuevos de cancer en agnosticados el de prostata emas, es 
prevenible en muchos reduccion de tabaquismo como factores 
determinantes.

Otros elementos clave para un paciente son si tiene o no un seguro 
medico, que incluye la cubierta de su poliza, el tiempo de espera para 
acceder a los servicios, la distancia hasta la instalacion medica donde 
recibe atencion y si tiene transportacion o no, puntualizo De Jesus 
Monge.

Riesgo en edades vulnerables

Durante los ultimos 66 anos, el cancer ha sido la segunda causa de 
muerte en Puerto Rico (1957-2023), siendo los adultos mayores los mas 
afectados, con una mediana de edad de 67 anos en los diagnosticos de 
esta enfermedad, segun la informacion mas reciente disponible en el 
Registro Central (2016-2020).

``La poblacion ha envejecido mas, y esta es una enfermedad mayormente 
de edad avanzada, aunque tambien se ven casos en mas jovenes, donde ha 
habido un aumento'', declaro el doctor Fernando Cabanillas, director 
medico del Centro de Cancer del Hospital Auxilio Mutuo.

Al hacer referencia a los datos en el Registro Central, que incluyen 
una proyeccion de los diagnosticos realizados entre 2017 y 2019, Cristy 
dijo que ``aproximadamente cuatro de cada 10 personas (41.5%, segun el 
reporte) seran diagnosticadas con algun tipo de cancer ``, y considero 
que este panorama es comun en paises desarrollados como Puerto Rico. 
``Estilos de vida donde abunda el sedentarismo (falta de ejercicio o 
actividad fisica) y una mala nutricion contribuyen a eso'', puntualizo.

Hace dos anos, los Centros para el Control y Prevencion de Enfermedades 
clasificaron a Puerto Rico con la mayor prevalencia de sedentarismo 
(49.4%) a nivel de Estados Unidos. Segun datos del Departamento de 
Salud, al 2021, el 72.4% de la poblacion estaba en sobrepeso o padecia 
de obesidad.

``El diagnostico de cancer ya no es una sentencia de muerte. Ademas, es 
        prevenible en muchos casos''--Maria Cristy

De acuerdo con Cristy, especialista en politica publica de cancer, las 
cerca de 5,000 muertes por cancer reportadas al ano en Puerto Rico 
obligan mirar la enfermedad como un problema de salud publica 
multidimensional, mientras que Cabanillas advirtio que hay otros tipos 
de cancer que surgen por ciertos virus o exposiciones a herbicidas, 
entre otros factores.

``En la mayoria (de los casos), no se conoce bien (su causa). Podria 
ser por el factor genetico o ciertos sindromes'', senalo Cabanillas.

Mas enfermedades cronicas y degenerativas

De Jesus Monge abundo que ``el desarrollo economico ha llevado a 
cambios en los estilos de vida.'' ``Antes, las enfermedades eran mas 
infecciosas y transmisibles, ahora predominan las cronicas y 
degenerativas'', apunto.

La edad y el sexo tambien son factores de vida a considerar en el 
desarrollo de cancer, sostuvo De Jesus Monge. ``Las mujeres hacen mas 
prevencion, visitan mas al medico para la atencion temprana de una 
posible enfermedad. El hombre tiene un estilo de vida mas arriesgado.

Por eso, aunque a nivel mundial nacen mas ninos que ninas, a los 29 
anos hay mas mujeres que hombres'', expuso.

Mejores medidas de higiene, disponibilidad de agua potable, un mayor 
entendimiento y educacion sobre las enfermedades, esfuerzos de 
prevencion y tratamientos mas efectivos han ayudado a que las personas 
vivan mas, destaco la demografa. La expectativa de vida en Puerto Rico 
es de 81 anos, en ambos sexos, al 2021, segun datos del Programa de 
Demografia del Recinto de Ciencias Medicas de la UPR.

``Aunque la vejez no es una enfermedad, ese deterioro progresivo lo 
        expone a otras condiciones de salud''--Vivianna de Jesus Monge

Pero, con una mediana de edad de 67 anos en los diagnosticos de cancer, 
De Jesus Monge expreso gran preocupacion ante la vulnerabilidad que ya 
reviste esa poblacion. ``Preocupa mucho, porque esas edades tienen ya 
de por si una salud fragil, posiblemente con otras comorbilidades y 
limitaciones. Aunque la vejez no es una enfermedad, ese deterioro 
progresivo lo expone a otras condiciones de salud'', alerto.

Agrego que con familias mas pequenas debido a la baja en natalidad y el 
aumento de la migracion, entre otros factores, muchos adultos mayores 
viven solos y enfrentan ese diagnostico de cancer con poco o ningun 
apoyo para ayudarlos a tomar decisiones sobre su tratamiento y como 
cuidar de su salud.

``El cancer se atiende de forma agresiva, con operaciones, 
quimioterapias y citas periodicas. Preocupa las condiciones con que 
enfrentan esto (el cancer) y las posibilidades de que sobrevivan'', 
sostuvo.

Aunque la mayor parte de los casos de cancer ocurren a partir de los 60 
o 65 anos, Cristy advirtio que se ha notado una estabilizacion de 
pacientes de esas edades, pero un aumento en personas de 55 anos o 
menos.

Crisis en la salud afecta a pacientes

Todo lo que afecte a la industria de la salud incidira directamente en 
el servicio a pacientes, establecio De Jesus Monge, quien este jueves 
presentara una ponencia en el Centro Comprensivo de Cancer, en Centro 
Medico de Rio Piedras, sobre como la demografia puede contribuir y 
ayudar al estudio e investigacion de esta enfermedad.

Explico, por ejemplo, que con el cierre de hospitales o areas 
hospitalarias se reducen las camas disponibles, lo que limita o demora 
la atencion a los enfermos. Y los que estan en mas riesgo son aquellos 
que padecen condiciones complicadas--como el cancer--y requieren 
multiples servicios.

De igual forma, dijo, es importante conocer la proporcion de medicos 
por paciente, en este caso, los oncologos, ya que esto podria provocar 
demoras en las citas medicas.

Cristy, al citar datos de la Asociacion de Hematologia y Oncologia 
Medica de Puerto Rico, informo que hay 114 hematologos oncologos 
activos en la isla. El mayor reto, planteo, es que solo hay cuatro o 
cinco ginecologos oncologos.

``No creo que haga falta muchos mas medicos a nivel de oncologia. No 
hay escasez, como la hay de cirujanos cardiovasculares. Y ya hay 
oncologos en practicamente toda la isla, no solo concentrados en el 
area metro'', puntualizo, por su parte, Cabanillas.

                                 ______
                                 

    Ms. Velazquez. Yet, Congress moves quickly to eliminate 
funding for the Energizing Insular Communities Grant Program in 
Fiscal Year 2024, one of the few resources available to advance 
energy resilience and protect those that suffer from terrible 
diagnoses like this. Can you please explain how much funding 
the Federal Government allocates on average annually to advance 
its military presence in the territories and how it compares to 
its investment in energy-related grants?
    Mr. Brewer. Congresswoman, thank you for your question. 
Having visited Guam myself, you are certainly correct, there is 
a significant military presence on the island of Guam. 
Unfortunately, I have no area of expertise in that, I will have 
to defer that part of your question to the Department of 
Defense.
    Regarding the EIC funding, let me just say a couple of 
things. One, since 2011, the EIC program actually has had an 
increase in funding starting in 2011 from about under $2 
million to now going to about $15.5 million, so we have seen a 
steady increase in EIC funding. That is the program that my 
office oversees, so that is really the one that I can speak 
mainly about. We have had that increase in funding and are very 
appreciative of that.
    Ms. Velazquez. And do you support for Congress to continue 
to allocate money, resources for the territories?
    Mr. Brewer. We certainly hope that the support Congress has 
shown will be there.
    Ms. Velazquez. Dr. Guannel, island territories are often 
accused of not having the capacity to identify, apply, and 
administer Federal grants, yet we know this does not have 
anything to do with being a territory, but rather it is closely 
related to the level of support the islands receive. How could 
the Federal Government better support capacity building and its 
investment to expand renewable energy?
    Dr. Guannel. I think that the programs that you mentioned 
and some of the examples that Mr. Fleming gave earlier of the 
type of grants that are received are examples of how the 
Federal Government can help the territories increase capacity. 
Mr. Fleming can speak more about this, but he has received a 
fair amount of funding for increasing workforce capacity to 
deal with the new technologies. We are also receiving funding 
to increase offerings at the university level to diversify the 
workforce and meet the demands because there is a very strong 
demand from a workforce point of view in terms of jobs for 
people to not only install, because energy companies which are 
privately owned are extremely busy and there is a surge in 
demand for jobs in that field, but there is also a large demand 
for energy conservation-type jobs.
    So, I think that the programs like EIC and others from the 
USDA and EPA go a very, very long way to increase the capacity 
of the territories.
    Ms. Velazquez. Thank you.
    Madam Chair, I yield back.
    Ms. Hageman. Thank you. I know recognize myself for 5 
minutes of questioning.
    Mr. Brewer, several of the territories have set aggressive 
goals for their transition to renewable energy. For example, 
American Samoa adopted a goal to obtain 50 percent of its 
energy from renewable sources by 2025 and 100 percent by 2040. 
Guam is also targeting 50 percent so-called renewable energy by 
2035 and 100 percent by 2040. CNMI 20 percent by 2016, and the 
U.S. Virgin Islands has a goal for 25 percent by 2020, 30 
percent by 2025, and 50 percent by 2044.
    Mr. Brewer, are these goals being met for transitioning to 
these so-called renewable energy resources? Have the 
territories been meeting their goals in terms of using 25 
percent, 50 percent, or 100 percent of so-called renewables by 
a particular date?
    Mr. Brewer. Thank you for your question, ma'am. I believe 
at this point, I don't have the numbers exactly in front of me, 
but I do know that, as you noted in your question, a percentage 
of their energy needs are being met through----
    Ms. Hageman. A percentage, but you don't know what 
percentage?
    Mr. Brewer. I would have to get back to you about the exact 
percentage at this time, what exactly they do----
    Ms. Hageman. OK. And you don't know if they are on track to 
meet their goals?
    Mr. Brewer. I would need to get back to you on that.
    Ms. Hageman. OK. Mr. Stein, as we see from both Mr. 
Fleming's and Dr. Guannel's written testimonies, the cost of 
this transitioning to wind and solar is extremely high, and at 
the same time the territories have set these extremely 
aggressive goals to transition in some cases to 100 percent 
wind and solar within the next 20 years. My first question for 
you is, why aren't they just doing it now, why do they have to 
wait 20 years if this is such a great thing and they are going 
to be able to meet all of their needs and demands, why wait 
until 2040, why not just do it right now?
    Mr. Stein. Well, there are a lot of factors that go into 
it. And first of all, the actual construction phase of both 
wind and solar is quite expensive and it takes a certain amount 
of time. There are environmental restrictions on things, for 
the islands in particular, the shipping costs are huge for 
getting some of these, like if you want to build a wind 
turbine, that is a very large piece of machinery.
    So, the timelines for this, even with unlimited money, you 
have a very long timeline. And, obviously, I don't really think 
that even on a 2030-year time scale it is actually physically 
possible to achieve this, but to even try, it takes a very long 
time.
    Ms. Hageman. Have you ever seen any state or territory that 
has managed to transition to mostly or completely renewable 
energy?
    Mr. Stein. Well, the key is defining what we mean by 
renewable energy. If we are including hydro in that definition, 
there are quite a few states and quite a few countries that 
have achieved not truly 100 percent but near 80 to 90 percent.
    Ms. Hageman. But that includes hydro.
    Mr. Stein. Right, that is including hydro because that is 
doing the baseload work. If you are talking about just wind and 
solar, there are very few options. I know that Iowa and South 
Dakota have very high penetrations of wind. In Europe, Denmark 
I believe is the only country that has surpassed 50 percent 
with wind and solar. But in all three of those cases, they are 
connected into large continental grids. They have neighbors 
that have a lot of water or nuclear power generation, so they 
have the ability to import on days when the wind is not 
blowing.
    Ms. Hageman. So, one of the things that has always just 
puzzled me about this discussion that we have been having with 
renewables and the amount of money that is being spent on what 
I would consider an astonishing boondoggle, what I would really 
like to see is, I would like to see a community be a pilot 
project for us. Let's just pick Boulder, Colorado, for example. 
It is about 100,000 people. I know that a lot of people who are 
strong advocates and believe very strongly in this climate 
crisis and how we need to transition away from the use of coal, 
oil, and gas.
    What I would love to do is have Boulder be our pilot 
project. Take out all of their gas stations, take out all of 
their gas-fired powered appliances, take away all of their 
internal combustion engines, require everybody to drive an 
electric vehicle, and then ring that community, which has a lot 
of wind and a lot of sun, by the way, and just ring that 
community with wind turbines and solar facilities, solar 
plants, and have no backup, no backup whatsoever, no gas-fired 
power plants, no coal-fired power plants, no generators. I 
would love to see a community like Boulder with 100,000 people 
be our pilot project.
    Mr. Fisher, do you think that that is something that is 
feasible in the next 10, 20, 30, 50, 75, or maybe 100 years 
where we would have a community like Boulder give up all access 
and use of fossil fuels and go solely to wind and solar as 
their energy supply?
    Mr. Fisher. That is an excellent question. I would like to 
see that experiment play out myself. But I have to admit, the 
amount that you would have to overbuild solar and wind 
resources to have anywhere near 100 percent reliability would 
be astronomically expensive and, in fact, I am not sure what 
the geographic scope of your circle is there, but I don't think 
there is even geographically enough space to do that.
    Ms. Hageman. OK. Well, don't you think we ought to try 
something like that before we try to impose it upon 330 million 
people in this country?
    Mr. Fisher. Yes, I think part of the problem is we don't 
have a very good experiment. We are sort of mandating our wish 
list instead of working through problems as they come up. I 
think one great example is it is true that the marginal cost of 
solar is very low, but when you consider integration costs, and 
balancing costs, and things like that, it is actually three or 
four times more expensive than you would expect if you just 
looked at the LCOE figures.
    And the cost impact, too, is something that we have to 
consider, and there is also a trade-off with reliability. So, 
even if you have a very low cost system, is it reliable? It is 
incredibly hard to do both and then to add the extra layer of 
sustainability or environmental consciousness, all of that, it 
is incredibly difficult, so it does take some careful 
experimentation, as you have said.
    Ms. Hageman. Well, I want to----
    Ms. Leger Fernandez. Madam Chair, would you yield?
    Ms. Hageman. Yes. I am actually out of time.
    Ms. Leger Fernandez. OK. We were talking earlier about 
Hawaii's goals, and Kauai's utility is at 100 percent renewable 
most days, island, and in 2022 they were at 60.2 percent. And I 
think the important point that was being made earlier is the 
idea of diversification because in many of these plans it is to 
not eliminate completely but it is actually creating a mix.
    Anyway, in answer to your question, we were able to pull 
that up since you had that.
    Ms. Hageman. But nobody at 100 percent. 60 percent. So, 40 
percent of the time, what you have pointed out is 40 percent of 
the time--yes, 40 percent of the time they don't have, so I 
guess I don't want to be in the hospital one of those days that 
is a 40 percent day.
    I want to thank the witnesses for your valuable testimony 
and the Members for their questions. The members of the 
Committee may have some additional questions for the witnesses 
and we will ask you to respond to those in writing.
    Mr. LaMalfa. I was wondering if there would be more rounds.
    Ms. Hageman. I have to go to another----
    Mr. LaMalfa. I know. I always do that, too.
    Ms. Hageman. Under Committee Rule 3, members of the 
Committee must submit questions to the Committee Clerk by 5 
p.m. on Tuesday, April 16, 2024, and the hearing record will be 
held open for 10 business days for these responses.
    If there is no further business, without objection, the 
Committee stands adjourned.

    [Whereupon, at 3:06 p.m., the Subcommittee was adjourned.]

            [ADDITIONAL MATERIALS SUBMITTED FOR THE RECORD]

Submission for the Record by Rep. Grijalva

                 Climate Strong Islands Network (CSIN)

                             Washington, DC

                                                 April 25, 2024    

Hon. Harriet Hageman, Chair
Hon. Teresa Leger Fernandez, Ranking Member
House Natural Resources Committee
Subcommittee on Indian and Insular Affairs
Washington, DC 20515

    Chair Hageman, Ranking Member Leger Fernandez, and Members of the 
Subcommittee:

    Thank you for the opportunity to provide written testimony as part 
of the record for the Indian and Insular Affairs Subcommittee hearing 
entitled ``Energizing the Territories: Promoting Affordable and 
Reliable Energy Sources for the U.S. Insular Areas.'' U.S. islands and 
territories need sound energy policy to ensure a future that allows 
their communities to continue to thrive. Clean, affordable, renewable 
energy will be a key part of building the resiliency of island 
communities as they face increased impacts of climate change, including 
natural disasters, sea level rise, and extreme weather events. Key to 
ensuring that energy (and all other) federal policies work for island 
communities is to include island voices in policy discussions, and to 
truly listen as they voice their needs and present solutions that work 
for their unique communities.

    The Climate Strong Islands Network (CSIN) was formed to help 
amplify the collective voice of island communities to drive more 
resources, supportive policies, and attention to U.S. islands. The CSIN 
Steering Committee includes community leaders from Guam, Northern 
Mariana Islands, Alaska, Hawai'i, Puerto Rico, American Samoa, and St. 
Croix. CSIN's mission is to build an effective coalition of island 
entities that work across sectors and geographies in the continental 
U.S. and the nation's states and territories located in the Caribbean 
and Pacific with the goal of helping their communities become more 
climate resilient.

    U.S. islands face a host of singular challenges exacerbated by 
climate change and natural hazards, geographic limitations, and varying 
degrees of political affiliation and representation within the U.S. 
Government. Island communities exist at the forefront of climate 
change, whether it be reoccurring disasters such as hurricanes and 
tsunamis or slow-onset issues such as extreme heat, ecosystem shifts, 
ocean warming, and sea level rise. These events have far-ranging 
impacts on human life and livelihoods, as well as on societal systems 
and supports. CSIN was established to bring island communities together 
to address these challenges and to establish their voice on national 
policy priorities and to build community resilience in the face of 
climate change. CSIN advocates for island-driven policy changes that 
address the unique challenges faced by island communities.

    CSIN is particularly interested in the subject of this hearing 
because it presents the opportunity to highlight the ways in which 
island communities, including the U.S. territories, are taking active 
steps to diversify their energy grids and prepare for future climate-
related energy disruptions and challenges.

    After watching the ``Energizing the Territories: Promoting 
Affordable and Reliable Energy Sources for the U.S. Insular Areas'' 
hearing, CSIN wants to emphasize several important points:

Island Communities Want Clean Energy

    In 2021, CSIN, led by its Steering Committee of island community 
leaders, released its National Islands Policy Framework, which outlines 
7 Key Issue Areas along with policy priorities and recommendations CSIN 
supports that will help islands become more resilient to climate 
change. Clean Energy is one of these key priority issues for CSIN. The 
National Islands Policy Framework states:

        ``In order to become climate resilient, U.S. islands need 
        local, independent, reliable, and affordable energy generation 
        and community based distribution systems that are locally 
        informed and accountable to local needs. Islands are naturally 
        more vulnerable to the effects of natural disasters so they 
        need self-sufficient and reliable energy systems to ensure they 
        can continue to serve their community even after a natural 
        disaster. Because of their unique geography and populations, 
        islands are the ideal place for renewable energy technologies 
        and innovations. Islands will need continued investment, 
        support, and technical training to transition to a clean energy 
        future. Technical training allows for islands to develop their 
        existing workforce with renewable energy expertise while 
        meeting the unique needs of their community. Developing 
        individual island capacity decreases islands' reliance on 
        fossil fuels and enables them to become energy independent. 
        Energy systems that work on an island could be applied to other 
        rural communities across the continental United States to help 
        those rural communities become more climate resilient.'' \1\
---------------------------------------------------------------------------
    \1\ CSIN National Islands Policy Framework

    The broad policy recommendations from CSIN related to Clean Energy 
---------------------------------------------------------------------------
are:

  1.  Federal government support for island communities in establishing 
            and achieving clean energy or net zero goals.

  2.  Federal clean energy policies and recommendations that are 
            locally and culturally relevant and consider local 
            expertise.

  3.  Develop effective federal funding mechanisms to incentivize and 
            support clean energy deployment and energy storage 
            solutions on islands.

  4.  Expand DOE's authority to finance clean energy projects in 
            frontline communities, including island communities.

  5.  Establish programs to operate clean energy related pilot programs 
            on U.S. islands to advance projects like microgrids and 
            small scale power generation.

    Island communities across the U.S. and the territories are 
demonstrating their interest in clean energy innovation. Programs like 
the Energizing Insular Communities (EIC) give islands the resources 
they need to launch their island-created and island-driven clean energy 
initiatives. The projects funded by the EIC program in FY2023, such as 
CNMI's Energy Task Force and Guam's ``Guam100'' project, demonstrate 
that island communities are leading the way to diversify and 
decarbonize their electric grids.\2\ Islands are looking ahead and 
working hard to innovate and find sustainable energy solutions that 
will help their communities become more resilient to climate change.
---------------------------------------------------------------------------
    \2\ https://www.doi.gov/media/document/eic-grants-territories-2023
---------------------------------------------------------------------------
Island Communities Need Diverse Energy Sources

    When natural disasters and extreme weather hits island communities, 
resilient power generation for electricity is imperative to ensure the 
safety of island residents and the operation of emergency response 
activities. That is why island communities need diverse energy sources 
that can ensure reliability when they need it the most. Renewable 
energy sources like solar and wind can continue to power homes and 
community services if a fossil fuel generated power plant is impacted 
by an earthquake, or if bad weather forces delays in the shipment of 
diesel fuel.

    On April 12, 2024, the day after the Subcommittee hearing, the 
Virgin Islands Water and Power Authority (WAPA) announced scheduled 
power outages ``. . . due to `inclement marine weather' in St. Thomas 
and St. John and offline generating units on St. Croix.'' \3\ 
Throughout the scheduled outages, residents and businesses were 
impacted, and the stability of the electrical grid was dependent on 
island residents reducing their energy consumption. This is a 
significant burden and disruption on island communities, one which 
could be avoided if diverse energy sources could come online when 
needed to respond to disaster and weather related energy disruptions.
---------------------------------------------------------------------------
    \3\ https://www.sottvi.news/p/wapa-shares-schedule-for-rolling-
blackouts

    Island communities support the EIC program because it invests in 
island-driven initiatives that diversify island energy sources, expand 
clean energy generation, and reduce energy costs for island residents, 
which ultimately will help islands become more climate resilient.
Island Communities Need Affordable and Reliable Energy

    Most islands do not produce their own petroleum or its derivatives 
like diesel, requiring islands to import fuel to operate their 
electricity generating power plants. This imported fossil fuel is not 
cheap, causing island communities to pay more than the average mainland 
U.S. community for their basic power needs. Further, fossil fuel energy 
is not immune to climate change disruptions. As demonstrated by the 
news of rolling blackouts in St. Croix, fossil fuel imports can be 
impacted by severe weather, and fossil fuel power plants can be damaged 
in natural disasters like floods and tsunamis. By diversifying their 
power sources and utilizing renewable energy sources that are available 
on islands, using technology to harness that energy that largely 
already exists, islands can reduce their energy costs and create a more 
reliable grid.
Island Communities Need Representation

    U.S. islands are politically under-represented by policymakers and 
elected officials in Washington, DC, which has resulted in under-
investment and a lack of knowledge and understanding by policy makers 
of the challenges they face and the unique ways in which federal 
policies will impact their communities. CSIN advocates for stronger 
representation for U.S. islands, so their unique needs are taken into 
consideration during the federal decision making processes. Congress 
and federal agencies have a responsibility to engage more directly with 
island communities as they establish and implement policies that impact 
islands.

    To address this issue, the federal government must make adjustments 
to ensure that a) island voices are heard during policy making 
processes, b) adequate consideration is given to the unique challenges 
of island communities, and c) island communities are directly engaged 
in the implementation of policies. Taking these steps will empower 
island communities to engage in the policy process and will ensure that 
future policies can be realistically deployed in island communities, 
which will go a long way to ensuring islands achieve long-term climate 
resiliency.

    Thank you for the opportunity to contribute testimony for the 
hearing record. The Climate Strong Islands Network stands ready to 
assist the Subcommittee in the future by providing an island 
perspective on policies that impact island communities.

            Sincerely,

        Lirio Marquez-D'Acunti,       Dr. Austin Shelton, III,
        Co-Chair, CSIN Steering 
        Committee                     Co-Chair, CSIN Steering Committee


                                [all]