[House Hearing, 112 Congress]
[From the U.S. Government Publishing Office]

THE DEPARTMENT OF ENERGY FISCAL YEAR
2012 RESEARCH AND DEVELOPMENT BUDGET REQUEST

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

HEARING

BEFORE THE

COMMITTEE ON SCIENCE, SPACE, AND TECHNOLOGY
HOUSE OF REPRESENTATIVES

ONE HUNDRED TWELFTH CONGRESS

FIRST SESSION

__________

MARCH 3, 2011

__________

Serial No. 112-4

__________

Printed for the use of the Committee on Science, Space, and Technology

Available via the World Wide Web: http://science.house.gov

U.S. GOVERNMENT PRINTING OFFICE
66-049 WASHINGTON : 2011
-----------------------------------------------------------------------
For sale by the Superintendent of Documents, U.S. Government Printing Office,
http://bookstore.gpo.gov. For more information, contact the GPO Customer Contact Center, U.S. Government Printing Office. Phone 202�09512�091800, or 866�09512�091800 (toll-free). E-mail, gpo@custhelp.com.

COMMITTEE ON SCIENCE, SPACE, AND TECHNOLOGY

HON. RALPH M. HALL, Texas, Chair
F. JAMES SENSENBRENNER, JR., EDDIE BERNICE JOHNSON, Texas
Wisconsin JERRY F. COSTELLO, Illinois
LAMAR S. SMITH, Texas LYNN C. WOOLSEY, California
DANA ROHRABACHER, California ZOE LOFGREN, California
ROSCOE G. BARTLETT, Maryland DAVID WU, Oregon
FRANK D. LUCAS, Oklahoma BRAD MILLER, North Carolina
JUDY BIGGERT, Illinois DANIEL LIPINSKI, Illinois
W. TODD AKIN, Missouri GABRIELLE GIFFORDS, Arizona
RANDY NEUGEBAUER, Texas DONNA F. EDWARDS, Maryland
MICHAEL T. McCAUL, Texas MARCIA L. FUDGE, Ohio
PAUL C. BROUN, Georgia BEN R. LUJAN, New Mexico
SANDY ADAMS, Florida PAUL D. TONKO, New York
BENJAMIN QUAYLE, Arizona JERRY McNERNEY, California
CHARLES J. ``CHUCK'' FLEISCHMANN, JOHN P. SARBANES, Maryland
Tennessee TERRI A. SEWELL, Alabama
E. SCOTT RIGELL, Virginia FREDERICA S. WILSON, Florida
STEVEN M. PALAZZO, Mississippi HANSEN CLARKE, Michigan
MO BROOKS, Alabama
ANDY HARRIS, Maryland
RANDY HULTGREN, Illinois
CHIP CRAVAACK, Minnesota
LARRY BUCSHON, Indiana
DAN BENISHEK, Michigan
VACANCY

C O N T E N T S

March 3, 2011

Page
Witness List..................................................... 2

Hearing Charter.................................................. 3

Opening Statements

Statement by Representative Ralph M. Hall, Chairman, Committee on
Science, Space, and Technology, U.S. House of Representatives.. 10
Written Statement............................................ 11

Statement by Representative Eddie Bernice Johnson, Ranking
Minority Member, Committee on Science, Space, and Technology,
U.S. House of Representatives.................................. 11
Written Statement............................................ 13

Witness:

Dr. Steven Chu, Secretary, Department of Energy
Oral Statement............................................... 14
Written Statement............................................ 16
Biography.................................................... 32

Discussion....................................................... 33

Appendix I: Answers to Post-Hearing Questions

Dr. Steven Chu, Secretary, Department of Energy.................. 80

Appendix II: Additional Material for the Record

Submitted Materials of Ranking Member Johnson, Committee on
Science, Space, and Technology, U.S. House of Representatives.. 282

Submitted Statement of Representative Jerry Costello, Committee
on Science, Space, and Technology, U.S. House of
Representatives................................................ 286

THE DEPARTMENT OF ENERGY FISCAL YEAR 2012 RESEARCH AND DEVELOPMENT
BUDGET REQUEST

----------

THURSDAY, MARCH 3, 2011

House of Representatives,
Committee on Science, Space, and Technology,
Washington, DC.

The Committee met, pursuant to call, at 10:05 a.m., in Room
2318 of the Rayburn House Office Building, Hon. Ralph Hall
[Chairman of the Committee] presiding.

hearing charter

COMMITTEE ON SCIENCE, SPACE, AND TECHNOLOGY

U.S. HOUSE OF REPRESENTATIVES

The Department of Energy Fiscal Year 2012

Research and Development Budget

thursday, march 3, 2011
10:00-12:00
2318 rayburn house office building

PURPOSE

On Thursday, March 3, 2011, the Committee on Science, Space, and
Technology will hold a hearing entitled ``The Department of Energy
Fiscal Year 2012 Research and Development Budget.'' The purpose of the
hearing is to receive testimony from the Secretary of Energy on the
President's Fiscal Year (FY) 2012 budget request for energy research
and technology development programs at the Department, including
activities under the Office of Science, Energy Efficiency and Renewable
Energy, Advanced Research Projects Agency-Energy, Fossil Energy,
Nuclear Energy, Electricity Delivery and Energy Reliability, and the
Loan Guarantee Program Office.

WITNESS

Dr. Steven Chu, U.S. Secretary of Energy. Dr. Chu was confirmed as
the 12th Secretary of Energy on January 20, 2009. Prior to his
appointment Dr. Chu was the Director of DOE's Lawrence Berkeley
National Laboratory, and a professor of Physics and Molecular and Cell
Biology at the University of California. He was the co-winner of the
1997 Nobel Prize for Physics.

BACKGROUND

The Department of Energy (DOE) funds a wide range of research,
development, demonstration, and commercial application activities.
DOE's primary mission is to ``advance the national economic, and energy
security of the United States; to promote scientific and technological
innovation in support of that mission; and to ensure the environmental
cleanup of the national nuclear weapons complex.'' \1\ In order to
fulfill its mission, DOE operations are guided by five strategic
themes: energy security, nuclear security, scientific discovery and
innovation, environmental responsibility, and management excellence.
---------------------------------------------------------------------------
\1\ All DOE mission statement quotes come from the cited office's
website.
---------------------------------------------------------------------------
The overall FY 2012 budget request for DOE is $29.5 billion, which
represents a $3.1 billion or 11.8 percent increase over FY 2010 levels.
Approximately one third of this amount is dedicated to programs within
the Committee on Science, Space, and Technology's jurisdiction. The
balance of DOE's funding is allocated to the National Nuclear Security
Administration (NNSA), to maintain our stockpile of nuclear weapons,
and Defense and Non-Defense Environmental Management (EM) programs, to
manage the cleanup of nuclear weapons production and government-
sponsored nuclear energy research.

DOE R&D PROGRAMS AND OFFICES

Office of Science

The total FY 2012 budget request for the Office of Science (SC) is
$5.4 billion, a $452 million or 9.1 percent increase over the FY 2010
levels. The mission of the Office of Science is the delivery of
scientific discoveries, capabilities, and major scientific tools to
transform the understanding of nature and to advance the energy,
economic, and national security of the United States. In support of
this mission, SC supports basic research in the following areas:
advanced scientific computing, basic energy sciences, biological and
environmental research, fusion energy sciences, high energy physics,
and nuclear physics. SC's operations take place in three main areas:
selection and management of research; operation of world-class, state-
of-the-art scientific facilities; and design and construction of new
facilities. SC also supports several ongoing interagency initiatives
such as the Networking and Information Technology Research and
Development program; the National Networking Initiative; the United
States Global Change Research Program; and the Climate Change
Technology Program. SC provides 45 percent of Federal support of basic
research in the physical sciences and key components of the Nation's
basic research in biology and high-end computing.
Office of Science budget and activities are divided into the
following six major program areas:

Basic Energy Sciences (BES) requests $1.99 billion, an increase of
$386 million (or 24.1 percent) over FY 2010 levels. BES supports basic
research into the fundamental building blocks necessary for advancing
new energy technologies, and maintains world-class research facilities
to develop new knowledge and facilitate advances in areas such as
materials science and chemistry.. The FY 2012 budget reiterates the FY
2011 request for $34 million to fund a new Batteries and Energy Storage
Energy Innovation Hub. Additionally, the existing Fuels from Sunlight
Hub requests $24.3 million.
In order to realize significant research gains and advance new
research methodology, in 2009 BES initiated the creation of Energy
Frontier Research Centers (EFRCs.) EFRCs are individually funded
between $2-5 million per year to conduct focused research from a small
team to solve ``grand challenges'' associated with disruptive
scientific advances. DOE requests continued funding of all 46 existing
EFRCs in FY 2012.
Biological and Environmental Research (BER) requests $717.9 million
in the President's budget, which is $129.9 million (22.1 percent) over
FY 2010 funding. BER examines fundamental biological systems, climate,
and environmental sciences. Specifically, BER researches genomics,
drivers of climate change, and deeper environmental issues. The request
also includes support for the three DOE Bioenergy Research Centers, the
Joint Genome Institute, and Environmental Molecular Sciences
Laboratory.
BER is also a major contributor to the Intergovernmental Panel on
Climate Change (IPCC) by providing expertise in climate modeling and
simulations. The FY 2012 budget request includes notable funding
increases for BER given pending work on the IPCC's Fifth Assessment.
The budget would provide $465.6 million for Advanced Scientific
Computing Research (ASCR), an increase of $82.4 million (21.5 percent)
over FY 2010 levels. A sizable portion of the increase is slotted for
National Leadership Computing Facilities, the nation's most powerful
open resource for capability computing located at Oak Ridge National
Laboratory and Argonne National Laboratory. Continued investigation of
a potential exascale computing project to increase computational
capacity by a thousand-fold accounts for the remainder of the requested
additional funds.
The request for Fusion Energy Sciences (FES) is $399.7 million, a
decrease of $18 million (4.3 percent) below FY 2010 funding. FES
supports research to improve fundamental understanding of matter at
very high temperatures and densities needed to develop fusion energy.
The contribution to the international ITER project, a partnership to
demonstrate the first fusion prototype, would be reduced by $30
million.
The FY 2012 funding request for High Energy Physics (HEP) is $797.8
million, a $6.4 million (0.8 percent) increase from the enacted FY 2010
level. HEP probes the basic relationship between space and time, the
elementary constituents of matter and energy, and the interactions
between them. This effort is concentrated on three scientific
frontiers: the energy frontier, the intensity frontier, and the cosmic
frontier.
Nuclear Physics (NP) would receive $605.3 million, an increase of
$82.8 million (15.9 percent) over FY 2010 funding. This program
supports research to discover and understand various forms of nuclear
matter. It also supports the production and development of techniques
to make isotopes that are in short supply for medical, national
security, environmental, and other research applications.

Energy Efficiency and Renewable Energy

The mission of the Office of Energy Efficiency and Renewable Energy
(EERE) is to ``strengthen the United States' energy security,
environmental quality, and economic vitality in public-private
partnerships.'' EERE supports this mission statement by: ``Enhancing
energy efficiency and productivity; bringing clean, reliable and
affordable energy technologies to the marketplace; and making a
difference in the everyday lives of Americans by enhancing their energy
choices and their quality of life.'' EERE participates in many
crosscutting activities with other departments, as well as within DOE
offices, including collaborations with the Office of Science, the
Advanced Research Projects Agency - Energy, Office of Electricity,
Fossil Energy, Federal Energy Management Program, and the Loan
Guarantee Program Office.
The Administration's budget request of $3.2 billion for EERE
represents a $958 million (44.4 percent) increase over FY 2010 levels.
This reflects the President's call in his State of the Union speech for
increased spending on clean energy technologies. The budget requests
significant funding increases for most EERE programs relative to the
FY10 enacted level. Additionally, EERE is increasing the number of
staff in their Washington, DC headquarters, while decreasing field
FTEs.
The proposed funding for the Solar Energy program is $457 million,
an increase of $213.6 million (87.8 percent) over FY 2010 levels. This
request intends to fund the ``SunShot'' initiative recently proposed by
the Administration. As a part of this initiative, EERE is advancing a
``Dollar-a-Watt'' program to make solar energy to be cost-competitive
with fossil fuels without subsidies. To achieve this goal, solar
generation needs to reach a four to five cents/kWh equivalent installed
price for solar photovoltaics (PV) energy by 2020, or reduce the
installed cost of solar electricity by approximately 75 percent from
current costs. Accordingly, an overwhelming percentage of solar
energy's increased funding is directed to the PV subprogram. EERE will
also continue to fund the Concentrating Solar Power (CSP) subprogram
for further research in CSP development and thermal storage activities.
As a means to accelerate widespread market adoption of solar energy,
the program also seeks to improve applicable local codes, permitting,
education and training.
The FY 2012 funding request for the Wind Energy program is $126.9
million, an increase of $47.8 million (60.6 percent) over FY 2010
levels. The request continues funding a demonstration project to
develop offshore wind technology, and aims to address financial,
regulatory, technical, environmental, and social issues associated with
offshore wind.
The FY2012 Biomass and Biorefinery Systems budget request is $340.5
million, an increase of $124.3 million (57.5 percent) over the FY 2010
level. This program aims to develop and transform domestic, renewable,
and abundant biomass resources into cost-competitive, high performance
biofuels, biopower, and bioproducts through targeted planning,
research, development and demonstration. In FY 2012, funding for
feedstock production trials will be eliminated. The elimination is
offset by a major increase of $150 million to expand the Cellulosic
Biofuels Reverse Auction with the intention of rapidly injecting money
into the emerging cellulosic biofuels industry. Support for integrated
biorefinery projects also notably decreases with increased focus on R&D
for downstream deployment efforts.
The proposed funding level for the Geothermal Technology program is
$101.5 million, an increase of $58.4 million (135.5 percent) over
FY2010. This program seeks to broaden its focus to include technologies
with a near-term impact by confirming undiscovered hydrothermal
resources with innovative exploration technologies. Additionally, the
Enhanced Geothermal Systems subprogram is aiming to advance new
technologies to use waste carbon dioxide to capture heat and make
electricity.
The Administration's budget request provides a total of $38.5
million for the Water Power program, which is a $10.2 million (20.9
percent) decrease from FY 2010 enacted levels. The program funds
incremental hydropower development and demonstrates marine and
hydrokinetic (MHK) technologies. The funding will support full-scale
MHK open water demonstration projects to establish the baseline cost of
MHK generated electricity by 2013.
The Hydrogen and Fuel Cell Technologies (HFCT) program requests
$100.5 million; a $70 million or 41 percent decrease from FY 2010
levels. The decrease reflects EERE refocusing of specific R&D on fuels
cells for stationary, transportation and portable power applications.
The budget request for the Buildings Technologies Program (BTP) is
$470.7 million, a $252 million (114.9 percent) increase over FY 2010
levels. BTP supports efforts to improve the energy efficiency of new
and existing homes and buildings primarily through advanced building
technologies, controls, systems, and whole-building design;
demonstration of integrated approaches for construction; bringing
transformational tools to the market place; supporting the ENERGY STAR
program; supporting the adoption, training, and enforcement of building
codes; and promulgating and finalizing efficiency standards as required
by law. The Energy Efficient Buildings Systems Design Hub is
administered by BTP.
BTP's FY 2012 request includes the President's new Better Buildings
Initiative, which aims to achieve a 20 percent improvement in
commercial building energy efficiency by 2020. In addition to increased
R&D funding for building technologies, the initiative includes new tax
incentives for commercial building energy efficiency projects and
financing opportunities for state and municipal governments through the
``Race to the Green'' competitive grant program. The initiative would
also receive funding from the Loan Guarantee Program Office.
TheVehicle Technologies Program (VTP) requests $588 million, an
increase of $283 million (93 percent) over the FY 2010 level. The
increase reflects an emphasis on the development and deployment of
plug-in hybrid vehicles (PHEVs). Specifically, in support of the
President's goal to place one million electric vehicles on the road by
2015, VTP is requesting $229 million proposing to fund infrastructure
development for transportation electrification, including a major new
program of grants to communities for upgrading electric vehicle
infrastructure.
The Industrial Technologies Program (ITP) request is $319.8
million, an increase of $225.5 million (239.2 percent) over FY2010
levels. ITP seeks to revolutionize industry's energy and carbon
intensity by developing manufacturing technologies, materials, and
clean energy manufacturing capacity. The Next Generation Materials and
Next Generation Manufacturing Processes subprograms are both
drastically increased to assist in attaining this goal. Additionally,
the request proposes the creation of an Energy Innovation Hub on
critical materials. A new $50 million Energy Efficiency Partnership is
included to assist industry incorporation of energy efficient
technologies into existing facilities.

The Advanced Research Projects Agency -Energy (ARPA-E)

The Administration requests $650 million for the Advanced Research
Projects Agency - Energy (ARPA-E).
Established in 2007 by the America COMPETES Act (P.L.110-69), ARPA-
E is statutorily charged with developing energy technologies that
result in ``(i) reductions of imports of energy from foreign sources;
(ii) reductions of energy-related emissions, including greenhouse
gases; and (iii) improvement in the energy efficiency of all economic
sectors.'' Initially provided with $400 million in American Recovery
and Reinvestment Act (ARRA) (P.L.111-5) funding, ARPA-E did not receive
a direct appropriation in FY10, though it was the beneficiary of a $15
million transfer from the Office of Science.
Of the $650 million request, $550 million would be provided through
discretionary funding for the purpose of sponsoring additional rounds
of project funding. Potential funding areas include stationary power,
electrical infrastructure, end use efficiency, embedded efficiency, and
transportation systems.
ARPA-E would also administer an additional $100 million Wireless
Innovation Fund (WIN) aimed at developing clean-energy wireless
technologies, paid for through a proposed transfer of wireless spectrum
auction revenues. The Administration proposes to establish WIN as a
mandatory program. In 2010, ARPA-E issued $207.6 million in ARRA funds
for 85 projects. The six program areas funded in 2010 included
Electrofuels, Batteries for Electrical Energy Storage in Transportation
(BEEST), Innovative Materials & Processes for Advanced Carbon Capture
Technologies (IMPACCT), Grid-Scale Rampable Intermittent Dispatchable
Storage (GRIDS), Agile Delivery of Electrical Power Technology (ADEPT),
and Building Energy Efficiency Through Innovative Thermodevices (BEET-
IT).Fossil Energy R&D
The DOE Office of Fossil Energy (FE) supports R&D focused on coal
(including clean coal technologies), gas, and petroleum and also
supports the Federal government's Strategic Petroleum Reserve. The
President's total budget request for FE is $520 million. Of that, FE's
R&D budget is $453 million, a decrease of $206 million (31.3 percent)
below FY10 enacted levels. Coal R&D is funded at $291 million, the bulk
of which focuses on advancing carbon capture and sequestration (CCS)
efforts. Carbon capture research reprioritizes research from pre-
combustion capture towards post-combustion technologies with the
intention of advancing the development of commercial technology. The
Carbon Storage subprogram is conducting large-volume injection testing
to examine the feasibility of long-term carbon storage. The Hydrogen
from Coal, Coal to Coal Biomass to Liquids, and Solid Oxide Fuel Cells
subprograms are all eliminated.
The FY12 budget request proposes to terminate the Natural Gas
Technologies and Unconventional Fossil Energy Technologies programs,
including the elimination of $50 million for the Ultra-Deep and
Unconventional Natural Gas Other Petroleum Resources Research Program.

Nuclear Energy (NE)

The primary mission of the Office of Nuclear Energy (NE) is to
``advance nuclear power as a resource capable of meeting the Nation's
energy, environmental, and national security needs by resolving
technical, cost, safety, proliferation resistance, and security
barriers through research, development, and demonstration as
appropriate.''
The FY12 budget request for NE R&D is $447.4 million, a $39.6
million (8.1 percent) decrease below FY 2010 levels. Approximately 74
percent of that request would be dedicated to the Fuel Cycle R&D and
Reactor Concepts RD&D programs. The Fuel Cycle R&D program conducts
research on the three basic fuel cycle technologies: once-through,
modified-open, and full recycle. The Reactor Concepts RD&D program
continues previous activities undertaken by the Generation IV Nuclear
Energy Systems program, including the Next Generation Nuclear Plant
project. In addition, advanced Small Modular Reactor (SMR) designs
would be examined.
As reflected in the Administration's FY 2011 budget request, NE
proposes to create the Nuclear Energy Enabling Technologies (NEET)
program. The $97.3 million program would investigate crosscutting
technologies and transformative breakthroughs applicable to multiple
reactor concepts and fuel cycle technologies. NEET would also support
the Modeling and Simulation Energy Innovation Hub, which seeks to
create a ``virtual'' reactor by applying existing modeling and
simulation capabilities. This would utilize modeling as a means to
improve efficiency in existing reactors as well as inform new reactor
designs.
The budget also proposes a SMR Licensing Technical Support Program
to partner with industry to accelerate development and licensing of
SMRs necessary for commercial deployment.

Electricity Delivery and Energy Reliability

The mission of the Office of Electricity Delivery and Energy
Reliability (OE) is to ``lead national efforts to modernize the
electric grid; enhance security and reliability of the energy
infrastructure; and facilitate recovery from disruptions to energy
supply.'' Research and development within OE is funded at $193 million
in the President's FY12 budget request. This reflects an increase of
$71.4 million (58.8 percent) over FY10 levels.
OE's R&D programs focus on clean energy transmission and
reliability, smart grid R&D, energy storage, and cyber security for
energy delivery systems. OE concentrates on potential strains on the
electric system as electric generation shifts towards low-carbon energy
sources, specifically associated intermittency problems from wind and
solar generation. The effects will require advanced grid modeling and
extensive technological breakthroughs in energy storage. The President
requests $20 million for the creation of a Smart Grid Technology and
Systems Hub to be administered by OE within the Clean Energy
Transmission and Reliability subprogram.
Also highlighted within the OE request is $57 million for the
Energy Storage subprogram, a 319 percent increase above the FY 2010
level to support demonstrations for a new suite of grid level storage
projects and further testing on prototype materials.

Loan Guarantee Program Office

The President's FY12 budget request for DOE's Loan Guarantee
Program Office (LPO) is $200 million. Funds would be used as a credit
subsidy for loans authorized under Section 1703 of the Energy Policy
Act of 2005. The LPO did not receive an appropriation for credit
subsidies in FY10. This level of appropriation would support an
estimated $1 to $2 billion in loan guarantees to support energy
efficiency and renewable energy activities.
Since its creation, the LPO has awarded over $17.6 billion for 18
projects, in a wide variety of areas such as solar and wind power
generation and manufacturing, geothermal energy, and electricity
transmission and energy storage.
In addition to the Title 17 loan guarantees, the President is
requesting $105 million to create a Better Building Pilot Loan
Guarantee Initiative for Universities, Schools, and Hospitals. This new
program would fund loan guarantees to retrofit commercial buildings and
would subsidize up to $2 billion in total loan principal.
Energy Innovation Hubs

The FY12 budget request proposes funding of $146 million for
support six Energy Innovation Hubs, which are supported through the SC,
EERE, and NE accounts. This would support the three existing Hubs and
as well as the creation of three new Hubs, which the President
highlighted in his recent State of the Union address. According to the
Administration, Hubs are funded at approximately $25 million each
annually and area intended to ``advance highly promising areas of
energy science and engineering from the early stage of research to the
point where the technology can be handed off to the private sector.''
\2\
---------------------------------------------------------------------------
\2\ http://www.energy.gov/hubs/
---------------------------------------------------------------------------
Existing Hubs include Fuels from Sunlight ($24.3 million,
administered by the Office of Science, Basic Energy Services), Modeling
& Simulation for Nuclear Reactors ($24.3 million, administered by the
Office of Nuclear Energy), and Energy Efficient Building Systems
Regional Innovation Cluster Initiative ($24.3 million, administered by
EERE, Building Technologies Program)The newly proposed Hubs are
Batteries and Energy Storage ($34 million, administered by the Office
of Science, Basic Energy Sciences), Smart Grid Technology and Systems
($19.4 million, administered by OE, Clean Energy Transmission and
Reliability Program), and Critical Materials ($20 million administered
by EERE, Industrial Technologies Program).
Chairman Hall. The Committee on Science, Space, and
Technology will come to order. Good morning to all of you, and
welcome to today's hearing entitled ``The Department of
Energy's Fiscal Year 2012 Research and Development Budget
Request.'' In front of all of us are packets containing the
written testimony, a biography and truth in testimony
disclosure for today's witness, Energy Secretary Steven Chu. I
want to welcome everyone here today for this hearing on the
President's fiscal year 2012 budget request. Is everybody ready
to roll? I will recognize myself for five minutes for an
opening statement. I will take less than five minutes. We don't
hold you to five minutes. We appreciate you being here very
much, and you may want to enlarge on some things and you may
not want to. That will be your decision.
I want to welcome everyone here today for the hearing on
the President's fiscal year 2012 budget request for the
Department of Energy. Now, this is the third time that
Secretary Chu has appeared before this Committee, and I want to
thank you and I want to thank all of you for your willingness
to be here and meet with members on Department of Energy
programs and priorities. This is also the third DOE budget that
the President sent to Congress, so it is general priorities and
our concerns with them should come as no surprise.
What is notable, however, is the degree to which the
President is what I guess in a poker game you would call it
double down, on his energy and climate agenda in light of the
continued struggle in the economy, trillion-dollar deficits,
rising gas prices and fuel supply concerns driven by Middle
East turmoil.
The centerpiece of this legislation is the President's
proposed requirement that the United States produce 80 percent
of its electricity from ``clean'' sources by 2035. While I want
to better understand how the Administration intends to reach
this goal, and while I strongly support an ``all of the above''
approach to energy security, I am concerned that the plan
entails spending that we really can't afford and taxes and
regulations that would severely raise the cost of energy and
harm, in my opinion and a lot of our opinions, our economy.
The merits of this proposal seem weakened further by the
fact that even if such a transition to clean electricity were
successful, its benefits in terms of the effect it could have
on climate change appears negligible.
My concerns regarding misplaced energy policy priorities
extend to the R&D budget as well. The fossil fuels that drive
our economy and meet over 80 percent of our energy needs
continue to be penalized in favor of cleaner alternatives, but
that seems to continue. For example, the natural gas and
unconventional fossil fuels technology programs are zeroed out
while energy efficiency and renewable energy R&D programs would
receive $1 billion, or a 44 percent increase above current
levels. And these increases come on the heels of over $16
billion in stimulus funding and a near doubling of the EERE
base budget since fiscal year 2006. I am also concerned that
much of the clean energy spending is focused on late-stage
technology development and commercialization more appropriately
performed by the private sector.
The changes called for in this budget are not just trends,
they represent dramatic shifts that warrant our close review
and consideration in the coming weeks and months. While I have
many concerns, I look forward to working with the Secretary,
Ranking Member Mrs. Johnson and members of the committee to
develop a thorough and constructive response to these
proposals.
[The prepared statement of Chairman Hall follows:]

Prepared Statement of Chairman Ralph M. Hall

I want to welcome everyone here today for this hearing on the
President's Fiscal Year 2012 budget request for the Department of
Energy.
This is the third time that Secretary Chu has appeared before this
Committee, and I want to thank him for his willingness to be here and
meet with our Members on Department of Energy programs and priorities.
This is also the third DOE budget that the President has sent
Congress, so its general priorities-and my concerns with them-should
come as no surprise.
What is notable, however, is the degree to which the President has
``doubled-down'' on his energy and climate agenda in light of the
continued struggling economy, trillion-dollar deficits, rising gas
prices, and fuel supply concerns driven by Middle East turmoil.
The centerpiece of this agenda is the President's proposed
requirement that the U.S. produce 80 percent of its electricity from
``clean'' sources by 2035. While I want to better understand how the
Administration intends to reach this goal, and while I strongly support
an ``all-of-the-above'' approach to energy security, I'm concerned that
this plan entails spending we can't afford and taxes and regulations
that would raise the cost of energy and harm our economy.
The merits of this proposal seem weakened further by the fact that,
even if such a transition to ``clean'' electricity were successful, its
benefits in terms of the effect it could have on climate change appears
negligible.
My concerns regarding misplaced energy policy priorities extend to
the R&D budget as well. The fossil fuels that drive our economy and
meet over 80 percent of our energy needs continue to be penalized in
favor of ``cleaner'' alternatives.
For example, the Natural Gas and Unconventional Fossil Energy
Technologies programs are zeroed out while energy efficiency and
renewable energy R&D programs would receive a $1 billion, or 44
percent, increase above current levels. And these increases come on the
heels of over $16 billion in Stimulus funding and a near-doubling of
the EERE base budget since FY 2006. I'm also concerned that much of
this ``clean energy'' spending is focused on late-stage technology
development and commercialization more appropriately performed by the
private sector.
The changes called for in this budget are not just trends-they
represent dramatic shifts that warrant our close review and
consideration in the coming weeks and months.
While I have many concerns, I look forward to working with the
Secretary, Ranking Member Johnson, and members of the Committee to
develop a thorough and constructive response to these proposals.
I now recognize Ranking Member Johnson for five minutes for an
opening statement.

Chairman Hall. I now recognize the Ranking Member, Mrs.
Johnson, for as long as she takes for an opening statement.
Ms. Johnson. Thank you very much, Mr. Chairman, and welcome
back to the Committee, Dr. Chu.
We are here today to discuss the President's fiscal year
2012 budget request for the Department of Energy, even though
as the fiscal year 2011 budget still dominates the attention of
the Congress. For both budget years and likely for years to
come, the issue remains the same: While we must be fiscally
responsible, we also must keep America competitive and create a
better future for the American people.
I agree with Chairman Hall. We are in a dangerous position
as it relates to our national deficit. As any responsible
American family would do, we have to reconcile how much money
the government spends and what it brings in. But we are also in
danger of jeopardizing our standard of living and our future if
we allow good programs to fall victim to indiscriminate cuts.
It is time to set priorities and make choices that do not leave
our workforce ill-prepared and hamper the country's ability to
innovate and grow.
If a family's budget is squeezed, they don't solve the
problem by pulling the kids out of school. We cannot roll back
the clock on our economy. Our economic woes weren't caused by
too much science. At a time like this, we need to make the
critical investments to bolster our research infrastructure and
our future workforce, advancing our technological capabilities
now while sowing the seeds for the industries of the future.
And let me be clear: I stand with the President and a number of
respected conservative columnists, numerous policy experts, and
I believe the American people when I say that these are
investments and not just spending.
With research in science education, there is a guaranteed
return. If the Continuing Resolution passed by the House two
weeks ago were enacted, the Department of Energy's basic
science and energy R&D portfolios as well as the extensive
network of national laboratories and world-class facilities
would be devastated. At the same time, these cuts would have
negligible real impact on our national deficit. If this C.R. is
enacted, it is known that within months STEM education, teacher
training, workforce development and activities of DOE will
likely cease. Many thousands of research scientists, graduate
students, technical and administrative staff, contractors and
other support staff across the country will be laid off or
furloughed. The impact on indirect jobs is expected to even be
greater. Research projects will be delayed or terminated.
Unique world-class scientific facilities used by industry and
academia will have operating times decrease, will be
temporarily shuttered or even completely closed. Ongoing
construction and upgrades at the labs and national user
facilities will not move forward, costing more in scheduling
delays and broken contracts, and restricting or eliminating
access for academic and industrial researchers.
This is especially worrisome to me because as we know, the
last hired are often the first fired. Many of the graduate
students and early career researchers that our future depends
on will likely be the first to lose their jobs. This strikes at
the heart of a generation rife with a passion for innovating--
young people who are willing to work long nights in labs across
the country to find solutions to our Nation's economic,
national security, energy, and environmental problems.
All of this could happen as countries like China, India,
Germany, Japan and many others seize on our weakness in this
economic downturn to invest billions of dollars to build up
their own clean energy technology sectors to compete with or
attract U.S. companies. For example, in 2009 alone, China's
government investment attracted $35 billion in private capital
for clean energy technologies. The United States came in a
distant second, attracting a little more than half that much.
In the President's recent State of the Union address, he
spoke at length about the need to reinvigorate the American
capacity for innovation, and he highlighted the economic
opportunities that lie in clean energy technologies. The fiscal
year 2012 request for DOE proposes increases in a number of
critical programs while making some tough but prudent decreases
in others. This is a direct illustration of the President's
commitment to a clean energy future and takes us into the
opposite direction from where the C.R. would leave us.
This committee has heard from a number of organizations,
industry associations, national labs and academia on the
negative impact of the proposed C.R. cuts and the important
roles these programs play in our economy.
Mr. Secretary, as you testify today, I hope to learn from
you how the proposed cuts to DOE will impact our country's
innovation pipeline and the young people preparing for careers
in these exciting new fields, and how the President's vision
will leave us better prepared to lead the global economy in
this century. I look forward to working with you and members on
both sides of the aisle on these important issues.
Thank you, Mr. Chairman. I yield back.
[The prepared statement of Ms. Johnson follows:]

Prepared Statement of Representative Eddie Bernice Johnson

Thank you Chairman Hall, and welcome back to the Committee,
Secretary Chu. We are here today to discuss the President's fiscal year
2012 budget request for the Department of Energy, even as the fiscal
year 2011 budget still dominates the attention of Congress. For both
budget years, and likely for years to come, the issue remains the same:
while we must be fiscally responsible, we also must keep America
competitive and create a better future the American people.
I agree with Chairman Hall--we are in a dangerous position as it
relates to our national deficit. As any responsible American family
would do, we have to reconcile how much money the government spends
with what it brings in. But we are also in danger of jeopardizing our
standard of living and our future if we allow good programs to fall
victim to indiscriminate cuts. It is time to set priorities, and make
hard choices that do not leave our workforce ill-prepared and hamper
the country's ability to innovate and grow. If a family's budget is
squeezed, they don't solve the problem by pulling the kids out of
school.
We cannot roll back the clock on our economy. Our economic woes
weren't caused by too much science. At a time like this we need to make
the critical investments to bolster our research infrastructure and our
future workforce, advancing our technological capabilities now, while
sowing the seeds for the industries of the future. And let me clear; I
stand with the President, a number of respected conservative
columnists, numerous policy experts, and, I believe, the American
people when I say that these are ``Investments'', and not just
``spending''! With research and science education, there is a
guaranteed return.
If the Continuing Resolution (CR) passed by the House two weeks ago
were enacted, the Department of Energy's basic science and energy RD&D
portfolios, as well as its extensive network of National Laboratories
and world-class facilities, would be devastated. At the same time these
cuts would have a negligible real impact on our national deficit.
If this CR is enacted it is known that within months:

Many thousands of research scientists, graduate
students, technical and administrative staff, contractors, and
other support staff across the country will be laid off of
furloughed.

The impact on indirect jobs is expected to be even
greater.

Research projects will be delayed or terminated.

Unique, world-class scientific facilities used by
industry and academia will have operating times decreased, will
be temporarily shuttered, or even completely closed.

STEM education, teacher training, and workforce
development activities at DOE will likely cease.

Ongoing construction and upgrades at the labs and
national user facilities will not move forward, costing more in
scheduling delays and broken contracts and restricting or
eliminating access for academic and industrial researchers.

This is especially worrisome to me because as we all know, the last
hired are often the first fired. Many of the graduate students and
early career researchers that our future depends upon will likely be
the first to lose their jobs. This strikes at the heart of a generation
ripe with a passion for innovating, young people who are willing to
work long nights in labs across the country to find solutions to our
nation's economic, national security, energy, and environmental
problems.
All of this could happen as countries like China, India, Germany,
Japan and many others seize on our weakness in this economic downturn
to invest billions of dollars to build up their own clean energy
technology sectors to compete with, or attract, U.S. companies. For
example, in 2009 alone, China's government investment attracted almost
$35 billion in private capital for clean energy technologies. The U.S.
came in a distant second, attracting a little more than half as much.
In the President's recent State of the Union address he spoke at
length about the need to reinvigorate the American capacity for
innovation, and he highlighted the economic opportunity that lies in
clean energy technologies. The FY 2012 request for DOE proposes
increases for a number of critical programs, while making some tough
but prudent decreases in others. This is a direct illustration of the
President's commitment to a clean energy future, and takes us in the
opposite direction from where the CR would leave us.
This Committee has heard from a number of organizations, industry
associations, national labs and academia on the negative impact of the
proposed CR cuts, and the important role these programs play in our
economy. Mr. Secretary, as you testify today, I hope to learn from you
how the proposed cuts to DOE will impact our country's innovation
pipeline and the young people preparing for careers in these exciting
new fields, and how the President's vision will leave us better
prepared to lead the global economy in this century.
I look forward to working with you and Members from both sides of
the aisle on these important issues.

Chairman Hall. Thank you, Ms. Johnson, for a good opening
statement.
If there are Members who want to submit additional opening
statements, your statements will be added to the record at this
point.
I have the privilege of introducing the witness at this
time. Dr. Chu serves as the 12th Secretary of Energy. Prior to
his service as Secretary at DOE, Dr. Chu was the Director of
DOE's Lawrence Berkeley National Lab and a professor of physics
in molecular and cellular biology at the University of
California. He was a co-winner of the 1997 Nobel Prize for
Physics, and that is quite an honor.
As I know our witness knows, spoken testimony is limited to
five minutes after which the members of the Committee will have
five minutes each to ask questions. The chair is able to
provide and the Committee is willing to provide some
flexibility to you since you are our only witness today and for
the important position that you hold and the gratitude we have
to you for appearing before us. I recognize you at this time,
sir.

STATEMENT OF DR. STEVEN CHU, SECRETARY,

DEPARTMENT OF ENERGY

Secretary Chu. Thank you, Chairman Hall, and thank you,
Ranking Member Johnson and members of this Committee. Thank you
for the opportunity to discuss the President's fiscal 2012
budget request for the Department of Energy.
Before I begin my statement, I want to acknowledge the
absence of Congresswoman Gabrielle Giffords, who has been a
strong voice on energy issues, especially solar energy. It has
been a privilege to work with her over the last two years and I
look forward to working with her again as soon as she is ready
to return to Washington.
President Obama has a plan for the United States to win the
future by out-innovating, out-educating and out-building the
rest of the world while at the same time addressing the
deficit. This Committee understands the importance of science
to our Nation's future. We must rev up the great American
innovation machine to create jobs and secure our future
prosperity.
Federal support for scientific research and our applied
energy portfolio is critical for our competitiveness. The
Department invests in early-stage research that the private
sector often considers risky, and we leverage our resources to
stimulate private sector investments in deployment.
To spur innovation, President Obama has called for
increased investments in clean energy research, development and
deployment. In addition, he has proposed a bold but achievable
goal of generating 80 percent of America's electricity from
clean sources by 2035. The clean energy standard would provide
a clear long-term signal to industry to bring capital off the
sidelines and into the clean energy sector. The most
competitive clean energy sources will win in the marketplace.
The government does not need to pick favorites.
The Department of Energy's fiscal year 2012 budget request
of $29.5 billion supports the President's goals and strengthens
the Nation's economy and security. Through energy efficiency
programs, we will save money for consumers by saving energy. In
addition, the budget supports the research, development and
deployment of renewable energy, the modernization of the
electric grid and the advancement of carbon capture and
sequestration technologies, and it helps reduce our dependence
on oil by developing the next generation of biofuels and
accelerating electric vehicle research and development.
We are also requesting new credit subsidy to support loan
guarantees for renewable and energy efficiency technologies. To
jump-start the nuclear industry, we request up to $36 billion
in loan guarantee authority while also investing in advanced
nuclear technologies.
The President's budget also invests in basic and applied
research and keeps us on the path to doubling the funding for
key scientific agencies including the Office of Science. The
budget invests $550 million in the Advanced Research Projects
Agency-Energy, also known as ARPA-E. The Administration also
seeks an additional $100 million for ARPA-E as part of the
President's Wireless Innovation and Infrastructure Initiative.
This investment will allow ARPA-E to continue promising early-
stage research projects that aim to deliver game-changing clean
energy technologies.
The Office of Science and ARPA-E play distinct and
complementary rules in our research portfolio. The Office of
Science supports basic research that furthers scientific
understanding while ARPA-E supports high-risk, high-reward
research projects to explore potentially transformative
technologies.
Another piece of our research effort is the energy
innovation hubs. Through the hubs, we are bringing together our
Nation's top scientists and engineers to achieve similar game-
changing energy goals but where a concentrated effort over a
longer time horizon is needed to establish innovation
leadership. The budget requests $146 million to support the
three existing hubs and to establish three new hubs. And
finally, the budget continues to support the Energy Frontier
Research Centers which are mostly university-led teams working
to solve scientific problems that are blocking clean energy
development.
To reach our energy goals, we must take a portfolio
approach to R&D pursuing several research strategies that have
proven to be successful in the past. But I want to be clear:
This is not a kitchen sink approach. This work is being
coordinated and prioritized with a 360-degree view of how the
pieces fit together. Taken together, these initiatives will
help America lead in innovation.
In addition to strengthening our economy, the budget
request also strengths our security by providing $11.8 billion
for the Department's National Nuclear Security Administration.
The Department is also mindful of our responsibility to
taxpayers. We are cutting back in multiple areas including
eliminating unnecessary fossil fuel subsidies. We are
streamlining operations. We are making some tough choices like
freezing salaries and bonuses for hardworking national
laboratory, site and facility management contractor employees.
The United States faces a choice today: Will we lead in
innovation and out-compete the rest of the world or will we
fall behind? To lead the world in clean energy, we must act
now. We can't afford not to.
Thank you, and I will be pleased to answer any questions
you may have.
[The prepared statement of Dr. Chu follows:]

Prepared Statement by Secretary Steven Chu, U.S. Department of Energy

Chairman Hall, Ranking Member Johnson, and Members of the
Committee, thank you for the opportunity to appear before you today to
discuss the President's Fiscal Year 2012 budget request for the
Department of Energy.
In his State of the Union address, President Obama laid out a plan
for the United States to win the future by out-innovating, out-
educating and out-building the rest of the world, while at the same
time addressing the deficit. The President's budget request invests in
much-needed programs while cutting back where we can afford to.
Many countries are moving aggressively to develop and deploy the
clean energy technologies that the world will demand in the coming
years and decades. As the President said, this is our generation's
``Sputnik moment.''
We must rev up the great American innovation machine to win the
clean energy race and secure our future prosperity. To that end,
President Obama has called for increased investments in clean energy
research, development and deployment. In addition, he has proposed a
bold but achievable goal of generating 80 percent of America's
electricity from clean sources by 2035.
A Clean Energy Standard will provide a clear, long-term signal to
industry to bring capital off the sidelines and into the clean energy
sector. It will grow the domestic market for clean sources of energy -
creating jobs, driving innovation and enhancing national security. And
by drawing on a wide range of energy sources including renewables,
nuclear, clean coal and natural gas, it will give utilities the
flexibility they need to meet our clean energy goal while protecting
consumers in every region of the country.
The Department of Energy's FY 12 budget request of $29.5 billion
supports these goals and strengthens the nation's economy and security
by investing in the following priorities:

Supporting groundbreaking basic science, research and
innovation to solve our energy challenges and ensure that the
United States remains at the forefront of science and
technology;

Leading in the development and deployment of clean
and efficient energy technologies to reduce our dependence on
oil, accelerate the transition to a clean energy economy and
promote economic competitiveness; and

Strengthening national security by reducing nuclear
dangers, maintaining a safe, secure and effective nuclear
deterrent and cleaning up our Cold War nuclear legacy.

While we are investing in areas that are critical to our future, we
are also rooting out programs that aren't needed and making hard
choices to tighten our belt. Additionally, we are improving our
management and operations so we function more efficiently and
effectively.

Leading in the Global Clean Energy Economy

As the President said in his State of the Union address, investing
in clean energy will strengthen our security, protect our planet, and
create countless new jobs here at home. The Department's budget request
invests $3.2 billion in energy efficiency and renewable energy
programs.
Through programs to make homes and buildings more energy efficient,
including a new ``Better Buildings Initiative'' to make commercial
buildings 20 percent more efficient over the next decade, we will save
money for families and businesses by saving energy. That is money that
can be re-invested back into the economy. In addition, the budget
supports the research, development and deployment of renewable sources
of energy like wind, solar and geothermal. It supports the
modernization of the electric grid and the advancement of carbon
capture and sequestration technologies. And it helps reduce our
dependence on oil by developing the next generation of biofuels and
accelerating electric vehicle research and deployment to support the
President's goal of putting one million electric vehicles on the road
by 2015. This includes a $200 million competitive program to encourage
communities to invest in electric vehicle infrastructure.
We're also focused on moving clean energy technologies from the lab
to the marketplace. Over the past two years, the Department's loan
programs have supported more than $26 billion in loans, loan
guarantees, and conditional commitments to guarantee loans for 23 clean
energy and enhanced automotive fuel efficiency projects across the
country, which the companies estimate will create or save more than
58,000 jobs. Building on this success, we are requesting new credit
subsidy that will support approximately $1 billion to $2 billion in
loan guarantees for innovative renewable energy and energy efficiency
technologies. These deployment efforts build on the substantial
investment made in the clean energy sector by the Recovery Act, and are
supplemented by tax incentives that have also played an important role
in bringing clean energy projects to market, such as the 48C
manufacturing tax credits and the 1603 cash grants in lieu of
investment tax credits, which the 2012 budget also expands. We are also
requesting $100 million in credit subsidy for a new ``Better Buildings
Pilot Loan Guarantee Initiative for Universities, Schools, and
Hospitals,'' which will guarantee up to $2 billion in loans to support
energy efficient retrofits.
Nuclear energy also has an important role to play in our energy
portfolio. To jumpstart the domestic nuclear industry, the budget
requests up to $36 billion in loan guarantee authority. It also invests
in the research and development of advanced nuclear technologies,
including small modular reactors.

Supporting Groundbreaking Science

To spur innovation, the President's budget request invests in basic
and applied research and keeps us on the path to doubling funding for
key science agencies, including the Department's Office of Science. As
Norm Augustine, former Chairman of Lockheed Martin and former Under
Secretary of the Army, has said, under-funding R&D in a time of
austerity is like removing the engine of an aircraft to reduce its
weight.
That is why the budget request increases support for the
Department's comprehensive research strategy to accelerate energy
breakthroughs.
Through $5.4 billion for the Office of Science, we're expanding our
investment in basic energy sciences, advanced scientific computing and
biological and environmental sciences - all key areas for our future
economic competitiveness.
The budget invests $550 million in the Advanced Research Projects
Agency-Energy, also known as ARPA-E. The Administration also seeks an
additional $100 million for ARPA-E from the Wireless Innovation Fund to
support wireless clean energy technologies. This investment will allow
ARPA-E to continue the promising early-stage research projects that aim
to deliver game-changing clean energy technologies. ARPA-E's projects
are generating excitement both in the Department and in the private
sector. For example, through a combined total of $24 million from ARPA-
E, six companies have been able to advance their research efforts and
show the potential viability of their cutting-edge technologies. This
extremely valuable early support enabled those companies to achieve R&D
milestones that, in turn, have attracted more than $100 million in
private sector funds to the projects. This is precisely the innovation
leverage that is needed to win the future.
Another key piece of our research effort is the Energy Innovation
Hubs. Through the Hubs, we are bringing together our nation's top
scientists and engineers to achieve similar game-changing energy goals,
but where a concentrated effort over a longer time horizon is needed to
establish innovation leadership. The Department has established three
Energy Innovation Hubs in the areas of energy efficient buildings,
modeling and simulation for nuclear reactors and fuels from sunlight.
The budget requests $146 million to support the three existing Hubs and
to establish three new Hubs in the areas of batteries and energy
storage, smart grid technologies and systems, and critical materials.
The Energy Innovation Hubs were modeled after the Department of
Energy's BioEnergy Institutes, which have established an outstanding
three-year track record.
Finally, the budget continues to support the Energy Frontier
Research Centers, which are mostly university-led teams working to
solve specific scientific problems that are blocking clean energy
development.
The Energy Innovation Hubs, ARPA-E, and EFRCs represent three
complementary approaches to advance groundbreaking discovery. When you
think of the EFRCs, think about a collaborative team of scientists such
as Watson and Crick unlocking the secrets of DNA. When you think of
ARPA-E, think about visionary risk-takers launching new technologies
and start-up companies out of their garages. When you think of the
Hubs, think of large, mission-oriented research efforts such as the
Manhattan Project, the development of radar at MIT's Radiation
Laboratory during World War II and the research in America's great
industrial laboratories in their heyday. We don't know where the big
energy breakthroughs are going to come from. To reach our energy goals,
we must take a portfolio approach to R&D: pursuing several research
strategies that have proven to be successful in the past. But I want to
be clear - this is not a ``kitchen sink'' approach. This work is being
coordinated and prioritized, with a 360-degree view of how these pieces
fit together. Taken together, these initiatives will help America lead
in science and technology innovation.

Nuclear Safety and Security

In addition to strengthening our economy, the budget request also
strengthens our security by providing $11.8 billion for the
Department's National Nuclear Security Administration. The five-year FY
12 to FY 16 request of nearly $65 billion for NNSA reflects the
President's nuclear security priorities, as well as his commitment to
modernize the U.S. nuclear weapons enterprise and sustain a strong
nuclear deterrent for the duration of the New START Treaty and beyond.
The request of $7.6 billion for Weapons Activities provides a
strong basis for transitioning to a smaller yet still safe, secure and
effective nuclear stockpile without additional nuclear testing. It also
provides much-needed resources to strengthen science, technology and
engineering capabilities and to modernize the physical infrastructure
of our nuclear security enterprise. The President has identified the
danger of terrorists getting their hands on nuclear weapons or the
material to build them as the greatest threat to global security. To
support the President's goal of securing all vulnerable nuclear
material around the world in four years, the budget invests $2.5
billion in the NNSA Defense Nuclear Nonproliferation program. This is
part of a five-year, $14.2 billion commitment for the program.
The budget also requests $1.2 billion to support the Navy's nuclear
powered submarines and aircraft carriers. And it provides $6.1 billion
to protect public health and safety by cleaning up the nation's Cold
War nuclear legacy.

Fiscal Responsibility

Through our investments, we are laying the groundwork for the
nation's future prosperity and security. At the same time, we are
mindful of our responsibility to the taxpayer. We are cutting back in
multiple areas, including eliminating unnecessary fossil fuel
subsidies, reducing funding for the Fossil Energy program and reducing
funding for the hydrogen technology program. We're streamlining
operations to reduce administrative costs. And we're making some
painful cuts, including ending operation of the Tevatron accelerator
and freezing salary and bonuses for hard-working National Laboratory,
site and facility management contractor employees.
Finally, we continue to make progress on a management excellence
agenda to improve our operations.
The United States faces a choice today will we lead in innovation
and out-compete the rest of the world or will we fall behind? To lead
the world in clean energy, we must act now. We can't afford not to.
Thank you, and now I am pleased to answer any questions you may
have.

HIGHLIGHTS OF THE FY 2012 BUDGET REQUEST

In his State of the Union address, President Obama said that
America faces ``our generation's Sputnik moment'' and that we need to
out-innovate, out-educate and out-build the rest of the world to
capture the jobs of the 21st century. ``In America, innovation doesn't
just change our lives. It's how we make our living.'' Through
innovation in promising areas like clean energy, the United States will
win the future and create new industries and new jobs. To lead in the
global clean energy economy, we must mobilize America's innovation
machine in order to bring technologies from the laboratory to the
marketplace. The Department of Energy (DOE) is on the front lines of
this effort. To succeed, the Department will pursue game-changing
breakthroughs, invest in innovative technologies, and demonstrate
commercially viable solutions.
In addition to energy advances that spark economic growth, national
security remains fundamental to the Department's mission. Through
bipartisan ratification of the New START treaty with Russia, America
and its global partners are leading by example in implementing the
focused expansion of domestic and international activities to reduce
the threat of nuclear weapons, nuclear proliferation, and unsecured or
excess weapons-usable materials. The National Nuclear Security
Administration (NNSA) supports the international effort to secure all
vulnerable nuclear materials around the world within four years. The
NNSA also fulfills the President's commitment to modernize the nation's
nuclear stockpile until a world without nuclear weapons can be
realized.
The Department's Fiscal Year (FY) 2012 budget request is $29.5
billion, an 11.8 percent or $3.1 billion increase from FY 2010 current
appropriation levels. The FY 2012 request supports the President's
goals to increase America's competitiveness by making strategic
investments in our nation's clean energy infrastructure and to
strengthen our national security by reducing the global threat of
nuclear materials. The President has called for advancing research on
clean energy technologies and manufacturing, doubling the share of
electricity generated from clean energy supplies by 2035, and putting
one million electric vehicles on the road by 2015. The Department's
request prepares for a multi-year effort to address these
interconnected objectives and prioritizes research and development of
renewable energy technologies to expand sustainable energy options for
the United States.
The FY 2012 budget builds on the intense planning, execution, and
oversight of the $35.2 billion from the American Recovery and
Reinvestment Act of 2009. By the end of FY 2010, the Department
successfully obligated $32.7 billion of Recovery Act funds, including
all funding that was set to expire. In developing the FY 2012 budget
request, the Department has taken these investments into account and
will oversee execution of these funds with value to the taxpayer in
mind. Recovery Act investments are focused on energy conservation and
renewable energy sources ($16.8 billion), environmental cleanup ($6
billion), loan guarantees for renewable energy and electric power
transmission projects ($2.4 billion), grid modernization ($4.5
billion), carbon capture and sequestration ($3.4 billion), basic
science research ($1.6 billion), and the Advanced Research Projects
Agency - Energy ($0.4 billion). The Department's Recovery Act
activities are strengthening the economy by providing much-needed
investment, saving or creating tens of thousands of jobs, cutting
carbon pollution, and reducing U.S. dependence on oil.
The President's FY 2012 Budget supports three strategic priorities:

Transformational Energy: Accelerate the
transformation to a clean energy economy and secure U.S.
leadership in clean energy technologies.

Economic Prosperity: Strengthen U.S. science and
engineering efforts to serve as a cornerstone of our economic
prosperity and lead through energy efficiency and secure forms
of energy.

Nuclear Security: Enhance nuclear security through
defense, nonproliferation, naval reactors, and environmental
cleanup efforts.

As the President has articulated, innovation is essential to
America's economic competitiveness. To meet the challenge of `our
generation's Sputnik moment,' the Department supports a coordinated
strategy for research and development across all of its programs. With
every initiative the Department undertakes, sound science is at the
core. In FY 2012, we will increasingly emphasize cross-cutting
initiatives to link science throughout the Department, specifically
with energy and national security programs in order to deliver results
to the American taxpayer. In the Office of Science, the Department
requests $5.4 billion, a 9.1 percent or $452 million increase over the
FY 2010 current appropriation levels, to support an elevated focus on
the advancement of the United States' leadership in fundamental
research. Advanced Research Projects Agency - Energy (ARPA-E) is
building on established gains since its initial funding in FY 2009
through the Recovery Act to perform transformational research and
create game-changing breakthroughs for eventual market adoption. The FY
2012 budget request includes $550 million for ARPA-E to sustain
investment in new energy technologies.
Energy Innovation Hubs play a key role in solving specific energy
challenges by convening and focusing top scientific and engineering
talent to focus on those problems. The Hubs bring together
multidisciplinary team of researchers in an effort to speed research
and shorten the path from scientific discovery to technological
development and commercial deployment of highly promising energy-
related technologies. The Department is proposing to double its
commitment to this research approach by requesting three new Hubs to
focus on batteries and energy storage, critical materials, and Smart
Grid technologies and systems. The Department will continue funding the
three Energy Innovation Hubs introduced in FY 2010 to focus on
developing fuels that can be produced directly from sunlight, improving
energy efficient building systems design, and using modeling and
simulation tools to create a virtual model of an operating advanced
nuclear reactor. Complementing the Hubs, the Department plans in FY
2012 to continue coordination with the Office of Science's Energy
Frontier Research Centers, which exemplify the pursuits of broad-based
science challenges for energy applications.

Energy Security: Promoting America's Energy Security through Reliable,

Clean and Affordable Energy

In his State of the Union address, the President outlined clearly
to the American people his roadmap for transforming our nation's energy
economy to meet the demands of future generations. ``Instead of
subsidizing yesterday's energy, let's invest in tomorrow's,'' he said.
To meet the President's challenge, the Department must recruit the
sharpest research minds and build on its aggressive discovery agenda
across all programs to achieve breakthroughs on the most pressing
energy challenges facing the United States.
In his address, President Obama laid out a goal for clean energy
sources to account for 80 percent of America's electricity by 2035. In
FY 2012, the Department requests funds to help achieve this
Presidential objective and address many of the energy delivery
challenges facing American families and energy providers.

Applied Research, Development and Deployment: Meeting
the President's goal of making America the first country to
have one million electric vehicles on the road by 2015, the
Department will research cost competitive methods to develop
electric vehicles, increase the adaptability and capacity of
the grid to enable vehicle charging, incentivize communities to
invest in electric vehicles and infrastructure and send these
vehicles to the nation's roadways. The Department will also
launch competitive manufacturing research for breakthrough
technologies in energy efficiency diagnostics and retrofits to
help business owners around the country save money on energy
costs.

Loan Guarantees: The Loan Programs Office (LPO) is a
vital tool for promoting innovation in the energy sector across
a broad portfolio of clean and efficient energy technologies.
In FY 2012, the Department is requesting credit subsidies to
support approximately $1 to $2 billion in loan guarantees for
renewable energy deployment and up to $36 billion in additional
authority to loan guarantees for nuclear power projects. The
Department will also continue to streamline and prioritize the
issuance of loan guarantees to leverage private sector
investment in clean energy and energy efficiency projects that
will save and create jobs.

Better Buildings Initiative: Last year, commercial
buildings consumed roughly 20 percent of all energy in the U.S.
economy. Improving energy efficiency in our buildings can
create jobs, save money, reduce our dependence on oil, and make
our air cleaner. The President's Better Buildings Initiative
will make commercial buildings 20 percent more energy efficient
over the next decade through initiatives that include: re-
designing the current tax deduction for commercial buildings
and upgrades to a credit that is more generous and that will
encourage building owners and real estate investment trusts
(REITs) to retrofit their properties; improving financing
opportunities for retrofits through programs including a new
Better Buildings Pilot Loan Guarantee Initiative for
Universities, Schools and Hospitals, for which the Department
of Energy requests $100 million in credit subsidy to guarantee
up to $2 billion in loans for energy efficiency retrofits for
these facilities; creating a $100 million Race to Green
competitive grant program for state and municipal governments
to implement innovative approaches to building codes,
performance standards, and regulations so that commercial
building efficiency will become the norm in communities across
the country; and calling on CEOs and university presidents to
join the Department of Energy and other Federal partners in a
Better Buildings Challenge to make their organizations leaders
in saving energy. The Better Buildings Initiative builds on our
investments through the Recovery Act and our continued
commitment to passing ``HOMESTAR'' legislation to encourage
American families to make energy saving upgrades in their
homes.

Electricity Reliability and Energy Management:
Reliable, affordable, efficient, and secure electric power is
vital to expanding economic recovery, protecting critical
infrastructures, and enabling the transition to renewable
energy sources. The FY 2012 request invests $238 million to
bring the next generation of grid modernization technologies
closer to deployment and commercialization, to assist states
and regional partners in grid modernization efforts, and to
facilitate recovery from energy supply disruptions when they
occur. The request includes a new Smart Grid Technology and
Systems Hub that will address the total electricity system,
covering applied science, technology, economic, and policy
issues that affect our ability to modernize the grid. The FY
2012 request also plans an expansion of the Home Energy Score
program that provides homeowners with information on how their
homes can be more energy efficient and guidance for saving on
home energy costs. This is in addition to the President's
support for passage of the Home Star rebate program in 2011.

Investing in energy efficiency, renewable energy generation, and
grid modernization are fundamental steps necessary for creating a clean
energy economy. We must also invest in the improvement of existing
sources of energy that will provide a bridge between current and future
technologies. These technologies are already a major segment of the
energy mix and will play a critical role in providing a solid
foundation that will make possible the creation of a new energy
economy.

Leadership in Nuclear Energy: Nuclear energy
currently supplies approximately 20 percent of the Nation's
electricity and 70 percent of the Nation's clean, non-carbon
electricity. The request for the Office of Nuclear Energy
includes $380 million for research and development, in addition
to key investments in supportive infrastructure. In addition,
the Department is engaging in cost-shared activities with
industry that may help accelerate commercial deployment of
small modular reactors. The request includes funding for cost-
shared design certification and licensing activities for small
modular reactors, the deployment of which holds promise for
vastly increasing the generation of clean energy on a cost
competitive basis. The Department will also promote nuclear
power through the Loan Guarantee Program, which is requesting
up to $36 billion in additional loan guarantee authority in FY
2012.

Advanced Fossil Energy: Experience in Carbon Capture
and Storage: The world will continue to rely on coal-fired
electrical generation to meet energy demand. It is imperative
that the United States develop the technology to ensure that
base-load electricity generation is as clean and reliable as
possible. The Office of Fossil Energy requests $452.9 million
for research and development of advanced coal-fueled power
systems and carbon capture and storage technologies. The Budget
focuses resources within the fossil energy program on
activities that can reduce carbon pollution and have potential
benefits for both the existing fleet and new power plants
specifically, post-combustion capture R&D and geologic carbon
storage R&D.

Ending Tax Subsidies to Fossil Fuel Producers: In
accordance with the President's agreement at the G-20 Summit in
Pittsburgh to phase out subsidies for fossil fuels so that we
can transition to a 21st century energy economy, the
Administration proposes to repeal a number of tax preferences
available for fossil fuels. Tax subsidies proposed for repeal
include, but are not limited to: the credit for oil and gas
produced from marginal wells; the deduction for costs paid or
incurred for any tertiary injectant used as part of a tertiary
oil recovery method; the ability to claim the domestic
manufacturing deduction against income derived from the
production of oil and gas and coal; and expensing the
exploration and development costs for coal.

Economic Security: Sharpening America's Competitive Edge through a

Clean Energy Economy

To meet ``our generation's Sputnik moment'' and promote economic
competitiveness, the U.S. must demonstrate leadership in clean energy
technologies. ``We'll invest in biomedical research, information
technology and especially clean energy technology - an investment that
will strengthen our security, protect our planet, and create countless
new jobs for our people,'' said President Obama before Congress in the
State of the Union address. President Obama outlined his comprehensive
vision to lead our nation's clean energy economy and provide economic
security to Americans. As the Administration seeks to reduce federal
government spending, the Department recognizes its role and has
tightened its expenditures in several areas such as oil and natural
gas. The FY 2012 budget request acknowledges the Department's missions
to achieve these imperative goals while setting forth a clean energy
economy for entrepreneurs and manufacturers to reclaim their
competitive edge in clean energy innovation.
The Department plans to promote economic security by building on
the progress made through the over $32 billion in grants and contracts
under the American Recovery and Reinvestment Act of 2009, which made
historic investments in the nation's economy and has put the country on
target to double renewable energy generation by 2012. The Recovery Act
helped create tens of thousands of jobs and, combined with the FY 2012
request, will help the Department accelerate the transition of our
nation to a clean energy economy.
The President's FY 2012 Budget supports the plan to rebuild our
economy through clean energy research and development by:

Expanding ARPA-E to spur innovation-The President's
request proposes $550 million for the Advanced Research
Projects Agency - Energy (ARPA-E) program, plus an additional
$100 million for the program from the Wireless Innovation and
Infrastructure Initiative for a total of $650 million. ARPA-E
performs transformational and cutting edge energy research with
real-world applications in areas ranging from grid technology
and power electronics to batteries and energy storage. The
budget also supports programs with significant promise to
provide reliable, sustainable energy across the country, such
as the SunShot initiative aimed at making solar energy cost
competitive. With focused investment in manufacturing
innovation and industrial technical efficiencies, the
President's proposal will move private sector capital off the
shelves and into the marketplace.

Targeting investments for future economic growth-To
secure a competitive advantage in high-tech industries and
maintain international leadership in scientific computing, we
will invest in core research activities for energy
technologies, the development of general biological design
principles and new synthetic molecular toolkits to improve
understanding of natural systems, and core research activities
to advance the frontiers of high performance computing.
Underlying these investments in research is the education and
training of thousands of scientists and engineers who
contribute to the skilled scientific workforce needed for a
21st century innovation economy.

Doubling the number of Energy Innovation Hubs to
solve key challenges-Innovation breakthroughs occur when
scientists collaborate on focused problems. The FY 2012 budget
request proposes three new Energy Innovation Hubs that will
bring top American scientists to work in teams on critical
energy challenges in areas such as critical materials,
batteries and energy storage, and Smart Grid technologies.
These will join three existing Hubs that focus on fuel
generation from sunlight, building efficiency, and nuclear
reactor modeling and simulation.

Integrating Research & Development-The Department has
identified areas where coordinated work by discovery-oriented
science and applied energy technology programs hold the
greatest promise for progress in achieving our energy goals.
The Energy Systems Simulation to increase the efficiency of the
Internal Combustion Engine (ICE) will produce a set of modern,
validated computer codes that could be used by design engineers
to optimize the next generation of cleaner, more efficient
combustion engines. An initiative on extreme environments will
close the gap between actual and ideal performance of materials
in nuclear environments. And the Department's Exascale
Computing initiative will allow the Department to take the lead
in developing the next generation of scientific tools and to
advance scientific discoveries in solving practical problems.

Pursuing the passage of HOMESTAR-Enactment of this
program will create jobs by providing strong short-term
incentives for energy efficiency improvements in residential
buildings. The HOMESTAR program has the potential to accelerate
our economic recovery by boosting demand for energy efficiency
products and installation services. The program will provide
rebates of $1000 to $3000 per household to encourage immediate
investment in energy-efficient appliances, building mechanical
systems and insulation, and whole-home energy efficiency
retrofits. This program will help middle-class families save
hundreds of dollars a year in energy costs while improving the
comfort and value of their most important investment - their
homes. In addition, the program would help reduce our economy's
dependence on fossil fuels and support the development of an
energy efficiency services sector in our economy.

Extending access to tax credit and tax grant
programs-Two provisions of the American Recovery and
Reinvestment Act have been extraordinarily successful in
spurring the deployment of renewable energy projects and
building advanced manufacturing capabilities: Section 48C
Advanced Energy Manufacturing Tax Credit program and the
Section 1603 Energy Cash Assistance program. The Administration
is pursuing an additional $5 billion in support for the Section
48C program, which, by providing a 30% tax credit for energy
manufacturing facilities, will continue to help build a robust
high-technology, U.S. manufacturing capacity to supply clean
energy projects with U.S. made parts and equipment. The Section
1603 tax grant program has created tens of thousands of jobs in
industries such as wind and solar by providing up-front
incentives to thousands of projects. The Administration is
seeking a one-year extension of this program.

Promoting efficient energy use in our everyday lives-
Currently, weatherization of more than 300,000 homes of low
income families has been achieved, providing energy cost
savings and financial relief to households. The FY 2012 request
of $320 million continues residential weatherization, while
increasing the focus on new innovative approaches to
residential home weatherization.

National Security: Securing Nuclear and Radiological Materials,

Maintaining Nuclear Deterrence, and Advancing Responsible

Legacy Cleanup

A pillar of President Obama's national security agenda for the
United States is to eliminate the global threat posed by nuclear
weapons and prevent weapons-usable nuclear material from falling into
the hands of terrorists. As part of this agenda, the Administration and
Congress worked tirelessly toward the December 2010 bipartisan
ratification of the New Strategic Arms Reduction Treaty (New START)
with Russia, which cuts the number of strategic nuclear weapons each
country can deploy to 1,550. After signing this agreement in April
2010, President Obama said, ``In many ways, nuclear weapons represent
both the darkest days of the Cold War, and the most troubling threats
of our time. Today, we've taken another step forward in leaving behind
the legacy of the 20th century while building a more secure future for
our children. We've turned words into action. We've made progress that
is clear and concrete. And we've demonstrated the importance of
American leadership--and American partnership--on behalf of our own
security, and the world's''.
The Department's National Nuclear Security Administration (NNSA),
through work with global partners and efforts to secure vulnerable
nuclear materials, achieved significant milestones during FY 2010 and
FY 2011 to reduce the risk of proliferation and leverage science to
maintain our nation's nuclear deterrence. Additionally, the
Environmental Management program made progress advancing responsible
nuclear cleanup from the Cold War. The Department's FY 2012 request
seeks to build upon these successes and advance the President's nuclear
security agenda.

Reduce the Risk of Proliferation
In 2009, President Obama committed the United States to an
international effort to secure vulnerable nuclear material worldwide in
four years. To solidify international support for this effort, and to
address the threat of nuclear terrorism, the President convened leaders
from 47 countries at the Washington Nuclear Security Summit in April
2010. The Summit resulted in a Communique which stated, ``Nuclear
terrorism is one of the most challenging threats to international
security, and strong nuclear security measures are the most effective
means to prevent terrorists, criminals, or other unauthorized actors
from acquiring nuclear materials.''
The FY 2012 budget for the NNSA Defense Nuclear Nonproliferation
program will help advance further work that is needed to meet the goals
of President Obama and the Nuclear Security Summit, recognizing the
urgency of the threat and making the full commitment to global
cooperation on nonproliferation. The budget provides $2.5 billion in FY
2012, and $14.2 billion through FY 2016 to detect, secure, and dispose
of dangerous nuclear and radiological material worldwide. This request
is a decrease of five percent, or $138 million, from the FY 2011
request, which reflects completion of accelerated efforts to secure
vulnerable nuclear materials within the President's stated timeframe.
The decrease also reflects our decision to await agreement between the
United States and Russia on detailed implementation milestones prior to
requesting additional U.S. pledged funding to support Russian plutonium
disposition. The FY 2012 budget request follows through on securing
vulnerable materials and supports efforts to design new technologies in
support of treaty monitoring and verification, which will contribute to
implementation of New START. The budget also broadens cooperative
nonproliferation initiatives with foreign governments and international
organizations in support of the President's objective of a world
without nuclear weapons. The budget continues the provision of security
upgrades at selected sites, both within the United States and in
foreign countries, to address outsider and insider threats, and
accelerates the pace of research reactor conversions from use of
highly-enriched uranium fuel to low-enriched uranium fuel.

Leverage Science to Maintain Nuclear Deterrence
The FY 2012 budget request advances the Department's commitment to
the national security interests of the United States through
stewardship of a safe, secure and effective nuclear weapons stockpile
without the use of underground nuclear testing. The 2010 Nuclear
Posture Review Report calls for the United States to reduce nuclear
force levels. As the United States begins the reduction required by New
START, the science, technology and engineering capabilities and
intellectual capacity within the nuclear security enterprise become
more critical to sustaining the U.S. nuclear deterrent. NNSA continues
to emphasize these capabilities, including functioning as a national
science, technology, and engineering resource to other agencies with
national security responsibilities. Through the NNSA, the Department
requests $7.6 billion for the Weapons Activities appropriation, an 8.9
percent, or $621 million, increase from the President's FY 2011
request. It also is an 18.9 percent, or $1.205 million increase from
the FY 2010 enacted appropriation. This increase reflects an investment
strategy that provides a strong basis for transitioning to a smaller
yet still safe, secure and effective nuclear stockpile without
additional nuclear testing, strengthening the science, technology and
engineering base, modernizing the physical infrastructure, and
streamlining the enterprise's physical and operational footprint. These
investments will further enable the Nuclear Posture Review's
comprehensive nuclear defense strategy, based on current and projected
global threats that rely less on nuclear weapons, while strengthening
the nation's nuclear deterrent through completing major stockpile
system life extensions, stabilizing the science, technology and
engineering base, and modernizing the infrastructure.
The Naval Reactors program ensures the safe and reliable operation
of reactor plants in nuclear-powered submarines and aircraft carriers,
constituting 45 percent of the U.S. Navy's combatants. The FY 2012
request for Naval Reactors of $1.2 billion, is an increase of $83.2
million or 7.8 percent over the FY 2011 request and $209 million or
18.1 percent above the FY 2010 enacted appropriation. Funding for this
program is ramping up for reactor design and development efforts for
the Ohio Class Replacement Submarine ($121 million), refueling of the
Land-Based Prototype ($99.5 million), and recapitalization of the naval
spent nuclear fuel infrastructure for the Spent Fuel Handling
Recapitalization program ($53.8 million) at the Naval Reactors Facility
located at the Idaho National Laboratory.

Advance Responsible Environmental Cleanup
The FY 2012 budget includes $6.13 billion for the Office of
Environmental Management (EM), to protect public health and safety by
cleaning up hazardous, radioactive legacy waste from the Manhattan
Project and the Cold War. This funding will allow the program to
continue to accelerate cleaning up and closing sites, focusing on
activities with the greatest risk reduction. Acceleration of cleaning
up sites where funding would have immediate impact was established as
the overarching objective of the $6 billion in Recovery Act funding. EM
will use the remaining $309 million of Recovery Act funding during FY
2012 as it completes footprint reduction and near-term completion
cleanup activities.
As the Department continues to make progress in completing
environmental cleanup, the FY 2012 budget request of $170 million for
the Office of Legacy Management supports the Department's long-term
stewardship responsibilities and payment of pensions and benefits for
former contractor workers after site closure.

DEPARTMENT OF ENERGY FY 2012 PROGRAM OFFICE HIGHLIGHTS

Office of Science: Invest in the Building Blocks of American Innovation

The Department of Energy's Office of Science (SC) delivers
scientific discoveries and major scientific tools to transform our
understanding of energy and matter and advance the energy, economic,
and national security of the United States. SC is the largest Federal
sponsor of basic research in the physical sciences, supporting programs
in areas such as physics, chemistry, biology, environmental sciences,
applied mathematics, and computational sciences. In FY 2012, the
Department requests $5.4 billion, an increase of 9.1 percent over the
FY 2010 current appropriation, to invest in basic research. The FY 2012
request supports the President's Strategy for American Innovation, and
is consistent with the goal of doubling funding at key basic research
agencies, including the Office of Science. The FY 2012 Office of
Science budget request supports the following objectives from the
Strategy, including:

Unleash a clean energy revolution

Strengthen and broaden American leadership in
fundamental research

Develop an advanced information technology ecosystem

Educate the next generation with 21st century skills
and create a world-class workforce

In FY 2012, SC continues to support fundamental research for
scientific discovery, but today our country needs to move strongly to
solve our energy problems. Therefore, the central theme of this year's
budget in SC is research in new technologies for a clean energy future
that address competing demands on our environment. These efforts,
coordinated with the DOE applied technology programs and with input
from the scientific community and industry, will emphasize research
underpinning advances in non-carbon emitting energy sources, carbon
capture and sequestration, transportation and fuel switching,
transmission and energy storage, efficiency, and critical materials for
energy applications.
In the area of advancing non-carbon energy sources, the FY 2012
budget request will provide for new investments in the science of
interfaces and degradation relevant to solar photovoltaics, basic
actinide chemistry research related to advanced nuclear fuel cycles,
and research in materials under extreme environments relevant to
extreme nuclear technology environments, and genomics-based research on
biological design principles and synthetic biology tools to underpin
bio-based energy solutions. Carbon capture and sequestration research
will focus on novel molecular design for materials and multiscale
dynamics of flow and plume migration, respectively. SC will initiate an
energy systems simulation research effort focused on predictive
modeling of combustion in an evolving fuel environment in support of
the Department's efforts in transportation and alternative fuels. Also
underpinning transportation and fuel switching, as well as energy
storage, the FY 2012 request will support an Energy Innovation Hub for
Batteries and Energy Storage. The Fuels from Sunlight Hub, established
in FY 2010, as well as the Energy Frontier Research Centers and DOE
Bioenergy Research Centers also continue. Research in enabling
materials sciences will support needs of future electricity
transmission systems and novel building materials to improve building
efficiencies.
The FY 2012 budget request also provides for foundational science
in condensed matter and materials physics, chemistry, biology, climate
and environmental sciences, applied mathematics, computational and
computer science, high energy physics, nuclear physics, plasma physics,
and fusion energy sciences; and provides for research facilities and
capabilities that keep U.S. researchers at the forefront of science.
The FY 2012 request supports targeted increases in areas such as
computational materials and chemistry by design, nanoelectronics, and
advanced scientific applications and integrated application-hardware-
software co-design for exascale, which position the U.S. to secure a
competitive advantage in high-tech industries and maintain
international leadership in scientific computing. Underlying these
investments is the education and training of thousands of scientists
and engineers who contribute to the skilled scientific workforce needed
for the 21st century innovation economy.
The Office of Science supports investigators at about 300 academic
institutions and from all of the DOE laboratories. Over 26,000
researchers from universities, national laboratories, industry, and
international partners are expected to use the Office of Science
scientific user facilities in FY 2012.

Advanced Research Projects Agency - Energy: Transformational Research
and Development
The FY 2012 budget request includes $550 million for the Advanced
Research Projects Agency - Energy (ARPA-E), plus an additional $100
million for the program from the Wireless Innovation and Infrastructure
Initiative for a total of $650 million. ARPA-E was launched in FY 2009
to sponsor specific high-risk and high-payoff transformational research
and development projects that overcome the long-term technological
barriers in the development of energy technologies to meet the Nation's
energy challenges, but that industry will not support at such an early
stage. An essential component of ARPA-E's culture is an overarching
focus on accelerating science to market. Beyond simply funding
transformational research creating revolutionary technologies, ARPA-E
is dedicated to the market adoption of those new technologies that will
fuel the economy, create new jobs, reduce energy imports, improve
energy efficiency, reduce energy-related emissions, and ensure that the
U.S. maintains a technological lead in developing and deploying
advanced energy technologies.

Office of Energy Efficiency and Renewable Energy: Investing in
Breakthrough
Technology and a Clean Energy Future
The Office of Energy Efficiency and Renewable Energy (EERE)
supports research, development, demonstration, and deployment
activities on technologies and practices essential for meeting national
security goals by reducing dependence on oil, meeting environmental
goals by minimizing the emissions associated with energy production and
use, and stimulating economic growth and job creation by minimizing the
cost of energy services. The EERE portfolio emphasizes work areas where
the potential impact is largest, where Federal funds are most critical.
It balances investments in high-risk research with partnerships with
private firms that speed the translation of innovations into practical
business opportunities. The diverse set of technologies supported helps
ensure that the U.S. has many options for meeting its energy goals.
Program management is designed to identify the best groups in the
country to address these challenges and supports work in universities,
companies, national laboratories, and consortia.
The FY 2012 budget request of $3.2 billion, the increase of 44.4%
over the FY 2010 current appropriation, is aimed at accelerating
innovation and change in the Nation's energy economy. The request
includes programs associated with meeting the President's goals of
investing in the next generation of clean energy technologies, vehicles
and fuels, and energy efficiency measures that reduce energy use in
Federal agencies and the industrial and building sectors.

Clean, Renewable Energy Generation
The FY 2012 budget request continues to work to transform the
Nation's energy infrastructure by investing over $1,164.9 million in a
variety of renewable programs including solar ($457.0 million), wind
($126.9 million), water ($38.5 million), hydrogen ($100.5 million),
biomass ($340.5 million), and geothermal ($101.5 million). Research,
development, and deployment of these technologies will reduce the
production of greenhouse gas emissions and revitalize an economy built
on the next generation of domestic production. The request includes the
solar SunShot program which will invest in transformative research
focusing on achieving radical cost reductions in photovoltaic modules,
balance of systems, and power electronics.

Energy Efficiency
The Department implements a number of efforts to increase energy
efficiency in homes, transportation, and industry. The FY 2012 budget
requests $1,805.3 million to accelerate deployment of clean, cost-
effective, and rapidly deployable energy efficiency measures in order
to reduce energy consumption in residential and commercial buildings,
and the industrial and Federal sectors. The Department will invest
$470.7 million in the Building Technologies program and $33.0 million
for the Federal Energy Management Program. Federal assistance for
state-level programs such as State Energy Program ($63.8 million),
Tribal ($10.0 million) and Weatherization Assistance Program ($320.0
million) will continue to help citizens implement energy efficiency
measures, lower energy costs and greenhouse gas emissions, and build a
technical workforce. ($319.8 million) for Industry will provide a
balanced portfolio of advanced R&D and pursuit of near-term low cost
opportunities with the objectives of increasing U.S. competitiveness,
enhancing clean energy manufacturing, and improving energy
productivity. There will be a focus on next generation manufacturing
processes and materials, activities for clean energy manufacturing, and
refocused efforts for Industrial Technical Assistance to achieve
greater results with less funding through more effective leveraging of
funding for deployment partnerships. A new Energy Innovation Hub on
critical materials will be competed through the Industrial Technologies
program. The FY 2012 request also includes $588 million to accelerate
research, development and deployment of advanced vehicle technologies,
working in concert with biomass RD&D to reduce the use of petroleum and
greenhouse gas emissions.
Better Buildings Initiative for Commercial Energy Savings-The
President's Better Buildings Initiative is focused on achieving a 20
percent improvement in commercial buildings' energy use by 2020. The
initiative will include many new components to achieve this goal. The
following are supported in the Department's FY 2012 request: launch of
the Race to Green competitive grant program for states and municipal
governments to encourage higher standards for commercial energy
efficiency, which is funded within the Buildings Technologies Program;
a new pilot loan guarantee program to support energy efficiency
retrofits for buildings that serve as community assets; and increased
R&D funding for building technologies. The Department intends to work
with the business and academic communities to make their organizations
leaders in saving energy.

Office of Electricity Delivery and Energy Reliability: Enabling a
Clean Energy Economy
The Office of Electricity Delivery and Energy Reliability (OE) is
responsible for leading national efforts to modernize the electric
grid, enhance the security of energy infrastructure, and facilitate
recovery from disruptions to the energy supply. The Department's FY
2012 budget request for OE of $238 million, a 38% increase over the FY
2010 appropriation, represents a clear and determined effort to
accelerate the transformation of one of the Nation's key enablers of a
clean energy economy - the electricity delivery system.
The U.S. electricity delivery system was built on technology that
was developed early in the 20th century and designed for the demands
and challenges of that era. Today, this aging and often congested
system is facing many new and complex challenges that require
considerable improvements in the physical and technological components
of the system. In order to alleviate the stress on the system from
increasing demand for electricity and to enable greater use and
integration of renewable and distributed resources, all while
maintaining the reliability, security, and affordability of electric
power, research and development breakthroughs and new energy management
approaches are critical in the areas of transmission and distribution,
energy storage, and cyber security.
OE's FY 2012 budget request provides $193 million for research and
development in these critical areas to bring the next generation of
grid technologies closer to deployment and commercialization. The
increased investment reflects the President's vision and OE's role in
competing in a worldwide technological race. As such, with $20 million
in FY 2012, OE will establish a new Energy Innovation Hub, or in the
words of President Obama, one of ``the Apollo projects of our time.''
The Smart Grid Technology and Systems Hub will bring together a
diverse, multi-disciplinary group to develop an integrated approach to
enhancing smart grid technologies and systems. OE will also expand its
advanced modeling capabilities to include other system layers in order
to provide a more in-depth system understanding. The energy storage
program will expand to aggressively support the deployment of grid-
scale energy storage technologies with new demonstrations, and the
cyber security program will continue to focus on the development and
integration of secure control systems.
The budget request continues to support Permitting, Siting, and
Analysis (PSA) with $8 million to develop and improve policies, state
laws, and programs that facilitate the development of electric
infrastructure needed to bring new clean energy projects to market, and
to provide technical assistance to states and regions. It also supports
Infrastructure Security and Energy Restoration (ISER) with $6.2 million
to enhance the reliability and resiliency of critical energy
infrastructure and to facilitate recovery from energy supply
disruptions.

Office of Environmental Management: Meeting Commitments and Making
Progress
The mission of the Office of Environmental Management (EM) is to
complete the safe cleanup of the environmental legacy brought about
from over six decades of nuclear weapons development, production, and
Government-sponsored nuclear energy research. This cleanup effort is
the largest in the world, originally involving two million acres at 110
sites in 35 states, dealing with some of the most dangerous materials
known to man. EM continues to pursue its cleanup objectives within the
overall framework of achieving the greatest comparative risk reduction
benefit and overlaying regulatory compliance commitments and best
business practices to maximize cleanup progress. To support this
approach, EM has prioritized its cleanup activities:

Activities to maintain a safe and secure posture in
the EM complex

Radioactive tank waste stabilization, treatment, and
disposal

Spent nuclear fuel storage, receipt, and disposition

Special nuclear material consolidation, processing,
and disposition

High priority groundwater remediation

Transuranic and mixed/low-level waste disposition

Soil and groundwater remediation

Excess facilities deactivation and decommissioning

The FY 2012 budget request for $6.13 billion will fund activities
to maintain a safe and secure posture in the EM complex and make
progress against program goals and compliance commitments by reducing
the greatest risks to the environment and public health, using science
and technology to reduce lifecycle costs, and reducing EM's geographic
footprint by 90 percent by 2015. EM continues to move forward with the
development of the capability for dispositioning tank waste, nuclear
materials, and spent (used) nuclear fuel. The budget request includes
the construction and operation of three unique and complex tank waste
processing plants to treat approximately 88 million gallons of
radioactive tank waste for ultimate disposal. It will also fund the
solid waste disposal infrastructure needed to support disposal of
transuranic and low-level wastes generated by high-risk activities and
the footprint reduction activities.
EM carries out its cleanup activities with the interests of
stakeholders in mind. Most importantly, EM will continue to fulfill its
responsibilities by conducting cleanup within a ``Safety First''
culture that integrates environment, safety, and health requirements
and controls into all work activities to ensure protection to the
workers, public, and the environment, and adheres to sound project and
contract management principles. EM is also strengthening its project
and planning analyses to better assess existing priorities and identify
opportunities to accelerate cleanup work. Working collaboratively with
the sites, EM continues to seek aggressive but achievable strategies
for accelerating cleanup of discrete sites or segments of work. In
addition, functional and cross-site activities such as elimination of
specific groundwater contaminants, waste or material processing
campaigns, or achievement of interim or final end-states are being
evaluated.
After the EM program completes cleanup and closure of sites that no
longer have an ongoing DOE mission, post closure stewardship activities
are transferred to the Office of Legacy Management (LM). LM also
receives sites remediated by the U.S. Army Corps of Engineers (Formerly
Utilized Sites Remedial Action Program) and private licensees (Uranium
Mill Tailings Radiation Control Act, Title II sites). Post closure
stewardship includes long-term surveillance and maintenance activities
such as groundwater monitoring, disposal cell maintenance, records
management, and management of natural resources at sites where active
remediation has been completed. At some sites the program includes
management and administration of pension and post-retirement benefits
for contractor retirees.

Loan Programs Office: Helping Finance Clean Energy Deployment
Innovative Technology Loan Guarantee Program -To encourage the
early commercial deployment of new or significantly improved
technologies in energy projects, the Department requests up to $36
billion in loan guarantee authority for nuclear power facilities and
$200 million in appropriated credit subsidy to support an estimated $1
to $2 billion in loans for renewable energy system and efficient end-
use energy technology projects under section 1703 of the Energy Policy
Act of 2005. The additional loan guarantee authority for nuclear power
projects will promote deployment of new plants and support an
increasing role for private sector financing. The additional credit
subsidy will allow for investment in the innovative renewable and
efficiency technologies that are critical to meeting the
Administration's goals for affordable, clean energy, technical
leadership, and global competitiveness.
The FY 2012 budget also requests $38 million to evaluate
applications received under the eight solicitations released to date
and to ensure efficient and effective management of the Loan Guarantee
program. This request is expected to be offset by collections from
borrowers authorized under Title XVII of the Energy Policy Act of 2005
(P.L. 109-8).
Advanced Technology Vehicle Manufacturing Program -The Department
requests $6 million to support ongoing loan monitoring activities
associated with the program mission of making loans to automobile and
automobile part manufacturers for the cost of re-equipping, expanding,
or establishing manufacturing facilities in the United States to
produce advanced technology vehicles or qualified components, and for
associated engineering integration costs.
Better Buildings Pilot Loan Guarantee Initiative for Universities,
Schools, and Hospitals -To spur investment in energy efficiency
retrofits for buildings which serve as assets to our communities, the
Department requests $100 million for loan guarantee subsidy costs to
support up to $2 billion in loan authority for universities, schools,
and hospitals. This pilot program is one component of the President's
Better Buildings Initiative and would fund cost-effective technologies
and measures to assist universities, schools, and hospitals save on
energy usage and associated energy costs. The Department also requests
$5 million for administrative expenses to carry out the program. The
request is subject to the enactment of legislation authorizing this
program.

Office of Nuclear Energy: Investing in Energy Innovation and Technical
Leadership
The Department is requesting $852.5 million for the Office of
Nuclear Energy (NE) in FY 2012 - a decrease of 0.6 percent from the FY
2010 current appropriation. NE's funding supports the advancement of
nuclear power as a resource capable of meeting the Nation's energy,
environmental, and national security needs by resolving technical,
cost, safety, proliferation resistance, and security barriers through
research, development, and demonstration as appropriate. Currently,
nuclear energy supplies approximately 20 percent of the Nation's
electricity and over 70 percent of clean, non-carbon producing
electricity. Over 100 nuclear power plants are offering reliable and
affordable baseload electricity in the United States, and they are
doing so without air pollution and greenhouse gas emissions. NE is
working to develop innovative and transformative technologies to
improve the competitiveness, safety and proliferation resistance of
nuclear energy to support its continued use.
The FY 2012 budget supports a balanced set of research,
development, and deployment (RD&D) activities. This program is built
around exploring, through its R&D technology and other solutions that
can improve the reliability, sustain the safety, and extend the life of
current reactors; improvements in the affordability of new reactors to
enable nuclear energy to help meet the Administration's energy security
and climate change goals; development of sustainable nuclear fuel
cycles; and minimization of risks of nuclear proliferation and
terrorism.
NE is requesting $125 million for Reactor Concepts Research,
Development and Demonstration. This program seeks to develop new and
advanced reactor designs and technologies. NE is also requesting $67
million for the Light Weight Reactor SMR Licensing Technical Support
program, which will support cost-shared design certification and
licensing activities for two light water reactor-based designs. Small
modular reactors are a technology that the Department believes has the
promise to help meet energy security goals. Work will continue on R&D
for the Next Generation Nuclear Plant to support demonstration of gas-
cooled reactor technology in the United States. The program also
supports research on Generation IV and other advanced designs and
efforts to extend the life of existing light water reactors.
The FY 2012 request includes $155 million for Fuel Cycle Research
and Development to perform long-term, results-oriented science-based
R&D to improve fuel cycle and waste management technologies to enable a
safe, secure, and economic fuel cycle. The budget also requests $97.4
million to support the Nuclear Energy Enabling Technologies program,
focused on the development of cross-cutting and transformative
technologies relevant to multiple reactor and fuel cycle concepts. The
Crosscutting Technology Development activity will focus on a variety of
areas such as reactor materials, creative approaches to further reduce
proliferation risks, and establishing advanced modeling and simulation
capabilities to complement physical experimentation. The Transformative
Nuclear Concepts R&D activity supports, via an open, competitive
solicitation process, investigator-initiated projects that relate to
any aspect of nuclear energy generation ensuring that good ideas have
sufficient outlet for exploration. Modeling and Simulation Energy
Innovation Hub, supported within this program, will apply existing
modeling and simulation capabilities to create a ``virtual'' reactor
user environment to simulate an operating reactor and is a prime
example of the type of crosscutting, transformative activity that will
enhance many research areas within NE. NE will also continue its
commitments to investing in university research, international
cooperation, and the Nation's nuclear research infrastructure -
important foundations to support continued technical advancement.
Office of Fossil Energy: Sustaining American Energy Options through
U.S. Ingenuity The FY 2012 budget request of $521 million for the
Office of Fossil Energy (FE) will help ensure that the United States
can continue to rely on clean, affordable energy from traditional
domestic fuel resources. The United States has 25 percent of the
world's coal reserves, and fossil fuels currently supply over 80
percent of the Nation's energy.
The Department is committed to developing technologies and
providing technology-based options having public benefits including
enhanced economic, environmental and energy security impacts. In FER&D,
the emphasis, in keeping with Presidential priorities, is in supporting
long-term, high risk initiatives targeted at carbon capture and storage
as well as advanced energy systems and on cross-cutting research.
In addition, $122 million of FE's $521 million request will be to
provide for national energy security through the continued operations
of the Strategic Petroleum Reserve. The budget proposes to sell $500
million of SPR oil in order to provide operational flexibility in
managing the Reserve.
The National Nuclear Security Administration: Leading Global
Partners on Nonproliferation by Securing Vulnerable Nuclear Materials;
Reaffirming Commitment to Stockpile Modernization The National Nuclear
Security Administration (NNSA) continues significant efforts to meet
Administration and Secretarial priorities, leveraging science to
promote U.S. national security objectives. The FY 2012 President's
budget request for NNSA is $11.8 billion; an increase of 5.1 percent
from the President's FY 2011 Request. The five-year FY 2012-2016
President's Request for the NNSA reflects the President's global
nuclear nonproliferation priorities and his commitment to modernize the
U.S. nuclear weapons complex and sustain a strong nuclear deterrent, as
described in the 2010 Nuclear Posture Review (NPR) Report, for the
duration of the New START Treaty and beyond. The NNSA's defense and
homeland security-related objectives include:

Ensure that the U.S. nuclear deterrent remains safe,
secure and effective while implementing changes called for by
the 2010 NPR and the New START Treaty

Broaden and strengthen the NNSA's science, technology
and engineering mission to meet national security needs

Transform the Nation's Cold-War era weapons complex
into a 21st century national security enterprise

Work with global partners to secure all vulnerable
nuclear materials around the world and implement the
President's nuclear security agenda expressed in the May 2010
National Security Strategy and the Nuclear Posture Review
report

Provide safe and effective nuclear propulsion for
U.S. Navy warships

The FY 2012 budget request of $7.6 billion for the Weapons
Activities appropriation provides funding for a wide range of programs.
Requested activities include providing direct support for the nuclear
weapon stockpile, including stockpile surveillance, annual assessments,
life extension programs, and warhead dismantlement. Science, Technology
and Engineering programs are focused on long-term vitality in science
and engineering, and on performing R&D to sustain current and future
stockpile stewardship capabilities without the need for underground
nuclear testing. These programs also provide a base capability to
support scientific research needed by other elements of the Department,
the federal government national security community, and the academic
and industrial communities. Infrastructure programs support facilities
and operations at the government-owned, contractor-operated sites,
including activities to maintain and steward the health of these sites
for the long term and construct new facilities that will allow the
United States to maintain a credible nuclear deterrent. The unique
nuclear security expertise and resources maintained by NNSA are made
available through the National Laboratories to other Departmental
offices, agencies and to the Nation for security and counterterrorism
activities.
The Weapons Activities request is an increase of 8.9 percent over
the President's FY 2011 Request. This level is sustained and increased
in the later outyears. The multi-year increase is necessary to reflect
the President's commitment to maintain the safety, security and
effectiveness of the nuclear deterrent without underground nuclear
testing, consistent with the principles of the Report on the Plan for
the Nuclear Weapons Stockpile, Nuclear Weapons Complex, and Delivery
Platforms (known as the ``1251 Report'') and the Stockpile Management
Program as stipulated in Sections 1251 and 3113(a)(2) of the National
Defense Authorization Act of Fiscal Year 2010. Increases are provided
for direct support of the nuclear weapon stockpile, for scientific,
technical and engineering activities related to maintenance assessment
and certification capabilities, and for recapitalization of key nuclear
facilities. The President's Request provides funding necessary to
protect the national resource of human capital at the national
laboratories through a stockpile stewardship program that exercises and
retains these capabilities.
The FY 2012 request for Defense Nuclear Nonproliferation (DNN) is
$2.5 billion; a decrease of 5.1 percent from the President's FY 2011
Request. This decrease reflects completion of long-lead procurements
for the Mixed Oxide Fuel Fabrication Facility (MOX) and Waste
Solidification Building (WSB). It also reflects our decision to await
an agreement between the U.S. and Russia on detailed implementation
milestones prior to requesting additional U.S.-pledged funding to
support Russian plutonium disposition. The Administration prioritizes
U.S. leadership in global nonproliferation initiatives as directed
through the National Security Strategy and has advanced this agenda
through commitments from global partners during the 2010 Nuclear
Security Summit. In addition to the programs funded solely by the NNSA,
Defense Nuclear Nonproliferation programs support interagency and
international efforts to protect national security by preventing the
spread of nuclear weapons and nuclear materials to terrorist
organizations and rogue states. These efforts are implemented in part
through the International Atomic Energy Agency, the G8 Global
Partnership against the Spread of Weapons and Materials of Mass
Destruction, and the Global Initiative to Combat Nuclear Terrorism.
DNN supports the President's goal to secure vulnerable nuclear
materials around the world within four years. The Global Threat
Reduction Initiative's emphasis in FY 2012 is to convert domestic and
international nuclear reactors from weapons-usable highly enriched
uranium fuel to low-enriched uranium fuel (LEU); while preserving our
capability to produce the critically needed Molybdenum 99 isotope. The
FY 2012 President's request for International Nuclear Materials
Protection and Cooperation reflects selective new security upgrades to
buildings and sites in accordance with the President's goal to secure
vulnerable nuclear materials around the world within four years, as
well as enhancements and sustainability support for previous work. The
Fissile Materials Disposition program continues domestic construction
of the MOX Fuel Fabrication Facility scheduled to come online in 2016;
and design for the pit disassembly and conversion capability to provide
it with plutonium oxide feedstock.
The President's request of $1.2 billion for Naval Reactors is an
increase of 7.8 percent over the President's FY 2011 Request. The
program supports the U.S. Navy's nuclear fleet, comprised of all of the
Navy's 72 submarines and 11 aircraft carriers, which constitute 45
percent of the Navy's combatants. The U.S. relies on these ships every
day, all over the world, to protect our national interests. The budget
provides funding increases for the Ohio Class Replacement submarine to
design and develop required submarine reactor plant technologies. R&D
is underway now, and funding during this Future Years Nuclear Security
Program is critical to support the long manufacturing spans for
procurement of reactor plant components in 2017, and ship construction
in 2019. Resources are also requested in FY 2012 to support design work
for the recapitalization of the spent nuclear fuel handling
infrastructure and refueling of the Land-based prototype.
The Office of the Administrator appropriation provides for federal
program direction and support for NNSA's Headquarters and field
installations. The FY 2012 request is $450.1 million; a 0.4 percent
increase over the President's FY 2011 Request. This provides for well-
managed, inclusive, responsive, and accountable organization through
the strategic management of human capital, enhanced cost-effective
utilization of information technology, and integration of budget and
performance through transparent financial management practices. The
increase reflects additional federal oversight for construction of the
Pit Disassembly and Conversion project, the Uranium Processing
Facility, and the Chemistry and Metallurgy Research Replacement
Facility.

Biography of Secretary Steven Chu, U.S. Department of Energy

Dr. Steven Chu, distinguished scientist and co-winner of the Nobel
Prize for Physics (1997), was appointed by President Obama as the 12th
Secretary of Energy and sworn into office on January 21, 2009.
Dr. Chu has devoted his recent scientific career to the search for
new solutions to our energy challenges and stopping global climate
change--a mission he continues with even greater urgency as Secretary
of Energy. He is charged with helping implement President Obama's
ambitious agenda to invest in alternative and renewable energy, end our
addiction to foreign oil, address the global climate crisis and create
millions of new jobs.
Prior to his appointment, Dr. Chu was director of DOE's Lawrence
Berkeley National Lab, and professor of Physics and Molecular and Cell
Biology at the University of California. He successfully applied the
techniques he developed in atomic physics to molecular biology, and
since 2004, motivated by his deep interest in climate change, he has
recently led the Lawrence Berkeley National Lab in pursuit of new
alternative and renewable energies. Previously, he held positions at
Stanford University and AT&T Bell Laboratories.
Professor Chu's research in atomic physics, quantum electronics,
polymer and biophysics includes tests of fundamental theories in
physics, the development of methods to laser cool and trap atoms, atom
interferometry, and the manipulation and study of polymers and
biological systems at the single molecule level. While at Stanford, he
helped start Bio-X, a multi-disciplinary initiative that brings
together the physical and biological sciences with engineering and
medicine.
Secretary Chu is a member of the National Academy of Sciences, the
American Philosophical Society, the Chinese Academy of Sciences,
Academica Sinica, the Korean Academy of Sciences and Technology and
numerous other civic and professional organizations. He received an
A.B. degree in mathematics, a B.S. degree in physics from the
University of Rochester, a Ph.D. in physics from the University of
California, Berkeley as well as honorary degrees from 10 universities.
Chu was born in Saint Louis, Missouri on February 28, 1948. He is
married to Dr. Jean Chu, who holds a D.Phil. in Physics from Oxford and
has served as chief of staff to two Stanford University presidents as
well as Dean of Admissions. Secretary Chu has two grown sons, Geoffrey
and Michael, by a previous marriage.
In announcing Dr. Chu's selection on December 15, 2008, President
Obama said, ``the future of our economy and national security is
inextricably linked to one challenge: energy. Steven has blazed new
trails as a scientist, teacher, and administrator, and has recently led
the Berkeley National Laboratory in pursuit of new alternative and
renewable energies. He is uniquely suited to be our next Secretary of
Energy as we make this pursuit a guiding purpose of the Department of
Energy, as well as a national mission.''
Chairman Hall. I thank you, Dr. Chu, and I will recognize
myself for five minutes.
My first question, and I may not have enough time to ask
the second question, but the centerpiece proposal in President
Obama's State of the Union address is his plan to require 80
percent of U.S. electricity to be derived from so-called clean
energy sources, actually not defined anywhere that I can find
so far. A study by economists at Suffolk University found that
the cost of a clean energy standard similar to what the
President is proposing would be almost $200 billion a year and
over $4 trillion over a 20-year period, and that is, to be fair
with you, a study of a similar plan, not this identical plan
but of a similar plan. Other studies might estimate these
figures to be higher or lower but as a matter of basic
economics, doesn't the President's proposal amount to mandating
Americans to pay significantly higher electricity costs? And in
terms of restricting fossil fuel usage and raising electricity
prices, wouldn't the clean energy sources have the same impact
as the Administration's now-defunct cap-and-trade proposal?
Secretary Chu. Thank you, Mr. Chairman. I am not aware of
that study, but first let me define what we mean by clean
energy. Solar, wind, new hydro, nuclear, those are all clean
energy, and we get full credit. If you looked at combined-cycle
gas which generates about twice the electricity for the same
amount of carbon emission, we would get half credit. If one
develops coal with carbon capture and sequestration and suppose
you capture 90 percent of the carbon emissions, that would
count was 90 percent credit. So based on that rough definition,
we are now currently generating 80 percent--40 percent of our
energy as clean. Nuclear is--20 percent of the electricity is
nuclear. Hydro is about 6-1/2, seven percent. The rest is a
little bit of solar but the rest is predominantly wind and a
little bit of geothermal.
So the President's goal of reaching 80 percent from 40
percent by 2035 anticipates, number one, that there will be a
new investment in nuclear energy, and this is something we
would like to grow as part of the portfolio. We project that
more solar and photovoltaic and solar thermal will be in play
and also more natural gas. When we develop clean coal
technologies and we are going to be working very hard over the
next decade to bring it down to affordable price, we think
investments in clean coal technologies will kick in. So it is
very important that that longer date, 2035, allows for the
development of clean coal technologies, allows for the long
planning process and construction process of nuclear.
In terms of how much it costs, we don't really know but I
will tell you that I talk to the utility companies, in the
coming decades, for example, Duke Energy tells me, Jim Rogers
at Duke says in the next 50 years every power plant that they
now own will have to be replaced and so the issue is when you
have a long time horizon going from 2011 to 2035, you will have
to replace a large fraction of these power plants and so it is
in this replacement and building up as you--because, for
example, many of our coal plants are over 40 or 50 years old.
They are on their last legs. As you replace them with newer
options, this is a very natural thing and so we want to give
credit to get this going.
Now, my last comment about the clean energy standard is
that there are estimates of $1 trillion to $2 trillion of
capital sitting on the sidelines because of the uncertain
conditions of what the United States should invest in, and what
the clean energy standard does is, it tells companies, utility
companies, it tells finance companies, this is the direction we
are going, you will have a market. If you build an efficient,
cost-effective way of generating electricity, you have a
market, we can invest in you, and all that capital can come off
the sidelines and immediately create jobs.
Chairman Hall. Do you agree that it will cost significantly
more than that, or have you had that opinion?
Secretary Chu. I would want to get back to you on that and
have, for example, the EIA and other analyses and give you a
synopsis of what we think the costs will be. I would be happy
to do that.
Chairman Hall. I appreciate it. I want to follow up. A core
objective of the President's clean energy proposal is obviously
addressing climate change. We look for that all the time. If
the President's plan is significantly or successfully, I might
say, implemented and we do indeed achieve the 80 percent, just
double what you set out as 40 percent clean energy goal, how
much effect could it have on climate change?
Secretary Chu. Well, the purpose of this is twofold. The
major purpose of this clean energy standard is to unleash
capital off the sidelines to allow for the private sector
investment in clean energy technologies and also in energy
efficiency which is turning very rapidly into a worldwide race
for the development of these technologies. So the primary
driver for what we are doing is, we are in a race now but the
world is going to need newer, cleaner sources of energy, a more
energy-efficient infrastructure. And this creates an incentive
for business to invest their capital, private sector capital,
in order to win in this race.
Now, having said that, if you look at what the President is
proposing as a goal, 80 percent by 2035, this is more or less
equivalent to a decrease in carbon dioxide that would put us on
a path by mid-century 2050 of reducing the carbon dioxide by 50
percent. So it is in line with the original goal of doing that
but the most important thing I want to return back to and
emphasize is that we are now in a worldwide race. You see
China, Japan, India, South Korea, European countries racing to
develop these technologies because they know there is going to
be a world market for them.
Chairman Hall. I thank you. I have gone over my time by a
few seconds. I would like to ask how much effect do you really
believe it will have, but I don't have the right to ask that
because I am out of time. I thank you.
Now I recognize Mrs. Johnson for her questions.
Ms. Johnson. Thank you very much, Mr. Chairman.
Dr. Chu, as we attempt to cooperate in cutting some of the
needed spending, one of the first things that we try to do is
look at duplication. There is a lot of concern about
duplicative programs both within DOE and other agencies. In
terms of research, how would you define duplication?
Secretary Chu. Well, how would I define duplication? If
certain research programs, for example, within Energy or within
the Office of Science or ARPA-E are funding more or less the
exact same type of research. You would not define it as there
is solar research that could be short-term solar research tied
to ARPA-E funds. You only have two years to get the private
sector to pick it up. Very, very different than the solar
research being funded in the Office of Science where you are
mostly tackling basic fundamental science problems that can go
to the next new thing. And so it sounds like the same, solar
research, but it is a very different type of funding.
Ms. Johnson. There is also a growing sentiment that a
number of the proposals for cuts will be applied to R&D. To me,
that is one of the most important things that we can do in
order to stay in the world race. What do you consider the most
dangerous and growing sentiment for wasteful spending or
investment in the future? How would you categorize some of the
suggestions or recommendations or even what was passed in the
C.R. two weeks ago?
Secretary Chu. Sure. All right. The President recognizes
and certainly Congress recognizes that we are going to have to
make such tough choices. The deficit is a huge problem and it
has to be tackled. But having said that, if you just do across-
the-board uniform cuts, this is not the way to run the country,
this is not the way to manage the multiple varied programs. You
have to make tough choices on what you want to invest in, and
in this I am reminded of what Norm Augustine, a very legendary
CEO and chair of Lockheed Martin had said, also well known in
Congress on both sides of the aisle, very well respected, and
he was CEO of Lockheed Martin and he said in his all
experiences as an engineer, as a CEO and chair, if you have an
overweight--in times of austerity, it is much like if you
design an airplane and you realize the airplane is overweight
and the way to trim the weight is to cut off an engine, that
that would not do well.
And so you have to recognize what are going to be the
engines that are driving the prosperity of our country, and the
President has said very clearly that there are two engines. One
engine is education, particularly science, engineering and
mathematics education, STEM education, and the other engine is
energy because it is no secret that many other countries around
the world, most notably China, have recognized that this is a
hugely growing technology opportunity and the country that
leads in energy technologies in this multi-trillion-dollar
market will be a very wealthy country, that you can wait and
let other countries go first and we can be importing those
technologies that we will need or we can be the front leader
and be exporting those. And so in this race for prosperity that
will create high-value manufacturing jobs in the United States.
The President has said we have to pay attention to this. This
is an internationally competitive race that we are in, and that
was our Sputnik moment.
Ms. Johnson. Thank you. My time is up, but I need to ask
one more question. Could you describe any type of impressive
research that might be going on in China right now or India or
any place?
Secretary Chu. If the chairman permits.
Chairman Hall. Without objection.
Secretary Chu. All right. Thank you. I would say if you
look in terms of impressive research, they are superb in taking
some existing technology and driving it better, so for that
reason they now have the highest speed rail service in the
world. They have captured that lead from France and from Japan.
They now can produce the highest voltage and highest capacity
transmission lines in the world, and they want to sell it to
the United States. They are building about half of the nuclear
reactors in the world today, over 25. They are the dominant
force in silken photovoltaics or photovoltaics of any kind in
the world. They have now taken over the leadership in exports
of solar cells. They build the highest-efficiency coal plants
with all the scrubbers and are now beginning to export them.
Their coal plants are now 46 percent efficient of energy into
electricity out. Our most advanced coal plants, I don't even
think break 40 percent. And so I would say in every energy
sector that I know, they are either getting into the lead or
have become the leaders, and they see a worldwide export
market.
Chairman Hall. The chair recognizes the gentleman from
California, Mr. Rohrabacher, for five minutes.
Mr. Rohrabacher. Thank you very much, Mr. Chairman.
You just mentioned the President's characterization of the
Sputnik moment, and let me just note, we are not in a Sputnik
moment, we are in a deficit spending moment when you see that
for the last two years straight and now for a third year in a
row this Administration is proposing a level of deficit
spending that is a shock to the system. We are talking a
trillion and a half dollars a year more in debt for our
children to pay, and I am suggesting to you that shock has had
a major impact and has to make a major impact on our decision-
making.
The answer that you just gave to the Ranking Member's
question, of those technologies that you have just outlined for
us that China is racing ahead in terms of putting them into
place and into practice, how many of them are based on research
that the Chinese did rather than research that was done in the
United States or other countries that they have taken advantage
of that research?
Secretary Chu. Okay. Thank you for the question. Well, let
me go down the list. In nuclear technology, the United States
made the first nuclear reactor as part of the Manhattan Project
but leadership and very quickly in the 1970s and early 1980s
constructed a fleet of roughly 100, a little over 100 civilian
nuclear reactors but we don't own that leadership today and
have not owned it for the last couple of decades.
Mr. Rohrabacher. Right.
Secretary Chu. France----
Mr. Rohrabacher. But in terms of China, how much of those
which you just suggested, you had a list, are any of them based
on the research that was done in China and not in the United
States or what we are seeing here is vast amounts of research
and--basically what we do is research and development here but
we are unable to actually put it in place while our adversary
in China takes it and runs with it. The problem isn't research
and development and the creativity of the American people. Our
problem is that we have got government in the way of people,
entrepreneurs and investors and people who would like to use
this technology here, and I would hope that perhaps the
Department of Energy would put some of its effort into breaking
through some of these barriers, one I would like to bring up
with you today, and that is, we need to make sure if--the
President's goal of having pollution-free energy sources is a
wonderful goal. Whether we agree with you on global warming or
not, that is irrelevant. The fact is, all of us should want
less pollution in the air and cheaper energy.
So with that understanding, nuclear energy seems like
something we could all come together on because at least the
liberal left in this country has at least accepted the fact
that nuclear energy needs to be something we look at. We have
got new gas-cooled reactors that offer great promise, small
gas-cooled reactors. How much money is being spent or how much
emphasis, should I say, is being put on gas-cooled reactors as
compared to light water reactors, which are the reactors of the
past?
Secretary Chu. Yes, we are--we run a program called Next
Generation Nuclear Reactors, and those are the gas reactors we
are talking about. We are funding that very steadily, and I
think in 2012 we hope to make a decision as to whether we go
forward with building a prototype of those reactors. I share
your enthusiasm in the sense that those gas-cooled reactors
used as heat sources instead of electricity generation could be
a very valuable source of energy that could supplement some of
the energy we use, for example, natural gas in order to
generate heat. And so we are very supportive of also small
modular reactors, right size reactors where you can plop them
down in places which don't have the infrastructure----
Mr. Rohrabacher. With that said, we need help from the
Department of Energy in breaking down the licensing process
that is preventing the technology that we already--we have a
capability of building those reactors right now. There are
several companies that come to mind. We could go into
production of this now except the licensing process will take a
decade. We need to cut that down because we are spending a
trillion dollars a year more than we are taking in, and this
would certainly contribute to wealth creation in the United
States. So I would hope that we can work together in breaking
down that licensing process.
Secretary Chu. Thank you. Part of our 2012 budget request
is for monies to help in the engineering to get licensing which
is NRC, it is their job, but we will help those companies
license the small modular reactors.
Mr. Rohrabacher. Well, let us make sure the Chinese don't
end up in production of these things that we are inventing
right here when we could go into production ourselves and we
just break down these governmental barriers.
Thank you very much, Mr. Chairman. Thank you, Dr. Chu.
Chairman Hall. Thank you, sir. The chair now recognizes the
gentlelady from California, Ms. Lofgren.
Ms. Lofgren. Thank you, Mr. Chairman, and thank you,
Secretary Chu. You probably don't remember, but I do, the first
time I met you, I happened to be on the Stanford campus the day
you won the Nobel Prize, and the last time I think I saw you
was also on the Stanford campus when we toured the Stanford
linear accelerator.
I ask this not just to you as the Secretary, but as the
really respected scientist that you are what the impacts of the
C.R., if extended throughout the year, would have on the
science that is in the Bay area. When we toured the Stanford
linear accelerator, we saw what they were doing in terms of
understanding at an atomic level, photosynthesis, for example.
I think about the National Ignition Facility over in Lawrence
Livermore, and it is a major scientific experiment; but,
obviously if it is successful, it will have a profound impact
on the energy picture for the world. Persis Drell has indicated
that basically she thinks that the linear accelerator would
have to simply shut down under the C.R. budget. What would the
impact be on our science future if that were to occur, Dr. Chu?
Secretary Chu. Well, if you are speaking of the current
2011 C.R.----
Ms. Lofgren. That is correct.
Secretary Chu. --and if you look at what the proposed 2011
budget is, what the C.R. was going to bring it back to, in
fact, that we are halfway through the year, it would be
something on the order of 40, maybe as high as a 50 percent cut
in the Office of Science. At that level, and in some parts of
the Office of Science it could be far more, so at that level I
think Persis Drell's assessment is correct, that many of the
user facilities like the new free electron laser, X-ray laser
that SLAC has would have to be shut down for some time. A lot
of graduate students and postdocs might have to be let go. This
would--so as Ranking Member Johnson said, it would have a
devastating impact on the number of jobs but the ripple effect
would be much deeper because if the students, the engineering
and science students see that federal funding of science can go
up and down, bouncing like a yo-yo, they could easily assume--
because most of the research dollars in science and engineering
are ultimately at the Ph.D. level and master's level ultimately
come from federal government. They would say this is not the
career for me, or if they have a Ph.D. they perhaps look abroad
to other countries.
So the ripple effect of unsteady up-and-down and certainly
draconian cuts in science would be far more devastating than
just the many thousands of jobs that would be lost or the
accelerators that would be turned down and those accelerators,
as you well know, are really engines of innovation. It is those
accelerators which have changed the paradigm of how we do
medical research and it is those accelerators that have changed
the paradigm of how we do materials research. In those
accelerators, we have made discoveries that have allowed us to
improve upon the lithium ion battery in such a dramatic way.
You know, the United States is--this is another one of these
good stories where the United States of America invents the
lithium ion battery, the dominant battery for plug-in hybrids
and electric vehicles. Very quickly technology leadership went
first to Japan, Sony, and now it is a big race between Japan
and Korea. The year 2000, we made some basic science
discoveries that all of a sudden say we can improve those
batteries, we can improve the lifetime of the batteries, the
energy density of the batteries, the safety of the batteries
and it is less expensive to produce.
So we are in the process of recapturing that technology
lead, and this is going to be a multi-billion-dollar business
and so we need those science facilities. You don't want to ship
them out.
Ms. Lofgren. On the NIF, we have made a huge investment
over the years in the NIF. What would this do if we project the
C.R. across as the budget for the year, what would it do to
that project?
Secretary Chu. Well, NIF comes from a different bucket of
money.
Ms. Lofgren. Okay.
Secretary Chu. This is funded not by the Office of Science.
It is funded actually by the NNSA. And I think the NNSA in the
C.R. is more protected because it is seen--its major mission is
nuclear security, and to that extent, there would be less of an
impact. I think the Office of Science impact would be pretty
devastating.
Ms. Lofgren. I will just say that I know my time is almost
up, Mr. Chairman. My daughter was an undergraduate at Stanford
and her roommate was a science major and my daughter was an
English major, and when they graduated my daughter decided to
go to law school where after three years she was able to earn
more than a Member of Congress; whereas, her science roommate
is still toiling away earning very little trying to get her
Ph.D., and unless we incent science, the people who love
science really won't stay. I also think the impact you said,
the devastating impact this would have on the future of
science, which is on the young scientists, is something that
very much needs to be considered. I am glad that you raised it.
I yield back, Mr. Hall.
Chairman Hall. I hope your daughter is as fine and helpful
to her profession as you have been to this Committee.
Now at this time I recognize Mr. Bartlett, one of the
senior members of this Committee from Maryland, for 5 or 10
minutes, whatever he wants.
Mr. Bartlett. Thank you very much.
Dr. Chu, thank you very much for your phone conversation
yesterday. I have a couple of questions relative to the super-
duty truck that I will submit for the record, sir, but I want
to turn to your attention to some slides, the first of which I
hope will show up on the screen.
[The information follows:]

Mr. Bartlett. Next slide.
[The information follows:]

Mr. Bartlett. Okay. I would like you to take a look at this
slide, sir. This is a 2008 slide from the World Energy Outlook.
Several interesting things about it. By 2030, they show the
total amount of liquid fuels that we will have as about 106
million barrels a day. They show the crude oil that we will
have from the fields that are now producing crude oil producing
only about less than a fourth of that and they show huge
contributions of oil from fields that we have now discovered
but are too expensive to develop, and then a big red wedge
there of crude oil from fields yet to be found. There is a dark
red wedge there of enhanced oil recovery.
Now, if we can see the next chart.
[The information follows:]

Mr. Bartlett. And this is from exactly the same
organization, and it is just two years later and some very
remarkable differences occur. First of all, they no longer
project that we are going to have 106 million barrels of oil a
day by 2030, they now say we are going to have 96 million
barrels a day by 2035, five years later, and they have only
about a fourth of the conventional oil production coming from
fields that we now pump. They have increased amounts of oil
coming from fields yet to be developed and fields yet to be
found. If you will look at the total amount of crude oil that
they say will be available, it rises only very slightly between
now and 2035.
[The information follows:]

Mr. Bartlett. If you look at the next slide, and if you
have only one slide that you could look at to inform you about
oil, it would be this slide. It is an old slide. You can see
that it was a 2004 slide. And it shows the discoveries of oil
through the past and you see them in the horizontal bars--I am
sorry, in the vertical bars there, huge discoveries starting
back in the late 1930s and the 1950s and 1960s, and notice from
1980 on we have always pumped more oil than we found, and they
were projecting in this chart that we were going to reach peak
oil production--that is that dark blue one in the previous two
slides--we were going to reach that about when we did, about
2006 or 2007 or so, and that is exactly when it happened. That
is now generally conceded to by just about every authority in
the world.
Look over on the left over there at the ordinate, you see
10 billion barrels. That is a pretty big find of oil. We need
to put that in perspective. It has been a long time since we
found very many fields with more than 10 billion barrels of
oil. Every 12 days, sir, as you know, the world uses a billion
barrels of oil. Every 12 days, a billion barrels of oil. That
is about 6th-grade arithmetic. Which means that if you have a
10-billion-barrel find, which is a big find, that will last the
world 120 days. Big deal.
[The information follows:]

Mr. Bartlett. And now if you look at the fourth slide, sir,
and this shows the world according to oil, and Saudi Arabia
needs to be diminished of it because Wikileaks a couple weeks
ago indicated they have been fibbing about how much oil they
have. I suspect much of the OPEC world has been fibbing about
it. But, you know, there we are using a fourth of the world's
oil, and we have only two percent of the world's oil. We are
pumping eight percent of the world's oil, which means we are
going to pump down very quickly.
Sir, isn't this pretty much the perfect storm at just the
time that the world has reached its maximum oil production? And
sir, if you believe that we are going to fill in those wedges
with oil to be pumped from fields that we have now discovered
and fields yet to be found, you probably believe you are going
to solve your personal economic problems by winning the
lottery. I think the odds are about the same. This is kind of
the perfect storm, sir. We now have peak oil and we have the
developing world leading it, trying to recover from a
recession. We have the developing world, China and India, using
hugely increased amounts of oil. We have the Wikileaks a couple
weeks ago indicating that there is considerably less oil out
there than we thought was out there, and now we have this
unrest in the Middle East. Shouldn't there be a plan B, sir, in
case the wildly optimistic projections of the World Energy
Outlook and the EIA and the IEA are not true?
Secretary Chu. Okay. I think there should be a plan A.
Mr. Bartlett. I don't even see a plan A. Plan A is business
as usual, and that ain't going to work, sir.
Secretary Chu. So let me make a few comments. First, thank
you for the slides. If you go back three slides at the world--
that one. I will agree with you. We are near the peak of peak
conventional oil. I think most oil companies will acknowledge
that. What that means is, conventional oil is oil on land,
easy-to-access oil, and what this projects is that there are--
what it is doing is, it is logging in current reserves. Current
reserves are bankable assets. I do feel that----
Mr. Bartlett. That is the next chart, sir. It shows the
reserves.
Secretary Chu. Right. But in this one, it essentially shows
just a very slight increase if you include all forms of oil,
oil yet to be discovered, oil produced in fields and
unconventional oil meaning tar sands oil, very thick bituminous
oil, things of that nature. And so certainly what this shows is
that the oil supplies are plateauing at best and they are going
to be plateauing and yet we see a dramatic rise in the world
wealth of countries, especially in developing countries like
China and India, where people--China is now the biggest car
market in the world, 14, 15 million cars a year being sold in
China, maybe 16 by now.
So what does that tell you? And as you go to harder-to-
access oil, deep offshore oil, oil in the Arctic, more
inconvenient oil, the lifting costs increase, so what that
tells me is that the price of oil in the following decades
because of the increased demand, because of our higher lifting
costs of oil, the price of oil will go up. So our plan A is to
recognize the price of oil will go. It will become a commodity
in higher demand and so we should do whatever we can to
decrease our dependency on oil, certainly our dependency on
foreign oil but oil, period, because oil is, you know, as you
noted, we consume 25 percent of the oil of the world. We only
have two percent of the reserves.
So from that alone, you say so what do we do. Our plan A is
to increase the fuel efficiency of cars and really push the
pedal to the floor on that one. For the first time in 25 years,
we have improved the EPA mileage standards but we have to do
better in the following years.
Point two: We can electrify the vehicles. If you begin to
electrify vehicles using batteries which I have a very strong
belief that within four to five years we will be testing
batteries to be put in cars that can enable us to drive 300
miles on a single charge in a midsized car and a battery that
costs maybe a third of what it costs today. Okay. Under those
conditions, you don't think about buying an electric car. Pure
economics tell you, you just go buy an electric car. An
electric car you plug in, you are using energy generated in the
United States to charge your car, so you offset the oil
dependency that way.
And finally, we are doing very promising research in
biofuels. Already work done in the national labs is being
licensed by companies in the private sector. They are doing
testing demos of this, and we think, you know, the first thing
is you use sugars and starches to get to ethanol but well
beyond ethanol drop-in substitutes for diesel fuel and for
gasoline for jet fuel. A company, Amers, is developing--is
building a pilot plan now for a drop-in diesel fuel substitute.
You feed it sugar, bacteria, make diesel fuel. They think they
can sell it at $4 a gallon, diesel fuel, but that is just the
beginning. Four dollars a gallon is still a little bit high, at
$4 a gallon, a profit. You know, when you sell it at $3 a
gallon, it is profit and now we are talking. And as you know,
diesel fuel is about $3.50 a gallon now.
So the combination of biofuels made from woody material and
agricultural waste, the electrification of vehicles. We also
have gas supplies and so a number of companies are looking at
delivery vans running off of natural gas. That could be a big
player too. And all those things decrease our dependency on
oil, and this is what I call our plan A.
Mr. Bartlett. Sir, that is all true. Just one moment more,
Mr. Chairman. That is all true, sir, but your government paid
for four studies, two of them in 2005, two of them in 2007.
They all say the same thing, that peaking oil was imminent with
potentially devastating consequences. The Hirsch report, the
big one, said if you didn't start planning for that 2 decades
before it occurred there were going to be meaningful economic
consequences.
Sir, we have run out of time. You don't really believe
those two blue wedges are going to occur, do you?
Secretary Chu. Well, actually, I do believe some of it will
occur, but be that as it may, I think you and I are in total
agreement. We should be pushing as hard as we can to reduce our
dependency on oil. We are--you know, $400, $300 billion a year
is leaking out of our shores to bring in oil.
Mr. Bartlett. Sir, I am way over time.
Thank you for your indulgence, Mr. Chairman. I yield back.
Chairman Hall. The senior citizen asked good questions and
we got good answers. I don't believe you all are totally in
agreement but your 20 minutes is up.
Secretary Chu. I apologize, Mr. Chairman.
Chairman Hall. It was good. You were giving good answers
and it is in the record and I think if we can keep anybody
awake that long they are going to enjoy reading everything we
do.
Is Mr. Wu back? All right. Then I think we ask Mr. Miller,
and I understand Mr. Miller has a request of the Committee.
Mr. Miller. Yes, Mr. Chairman. I know that Representative
Giffords has the affection and respect of every member of this
Committee. She has been a very engaged, conscientious member.
Her office has asked that I ask a question on her behalf, and I
certainly want to accommodate her. And then if I could have
perhaps not the full 20 minutes but a little more than five so
I could ask the questions I intended to ask.
Chairman Hall. Without objection, you know you can do that.
We want her questions asked, and she is living proof that
prayers are answered, and thank you for representing her.
Mr. Miller. And our prayers continue.
Secretary Chu, you have already mentioned that Ms. Giffords
was a great advocate for solar power. President Obama at his
State of the Union spoke of a ``Sputnik moment,'' and 50 years
ago President Kennedy called for an effort to go to the moon by
the end of the decade. You called that the ``moon shot'' and
you called for an effort that you called the ``sun shot'' to
make solar electricity much more competitive in the next
decade, specifically to bring down the cost by 75 percent, and
to raise our once-dominant position in the market for solar
voltaics. It was 43 percent in 1995. It is now six percent.
Ms. Giffords was a great advocate, as you have said. She, a
couple years ago in the last Congress, pushed forward the Solar
Technology Roadmap Act, which Congress, following her lead,
this Committee and Congress adopted, and I am sure that she
would like to know how the SunShot Initiative does compare to
her Solar Technology Roadmap Act that she advocated for so
effectively a year or two ago and how you plan to implement
that SunShot Initiative.
Secretary Chu. Okay. Thank you for the question. I think in
our SunShot Initiative, what we did is, we looked at what
industry's own roadmaps were and we canvassed many companies
both here and abroad, and where they think they could drive
down the prices, and this is the full price, the cost of
electricity. It is not the cost of the module itself but the
electronics, the mounting, the land use, everything,
insulation. And they found that within a decade one could
reduce the cost, the full all-in cost by a factor of two, 50
percent reduction. And we thought that that was not quite good
enough, and we began to talk with them and asked the question
what could we do in the Department of Energy and what could
they do in industry to bring that cost down more aggressively
before the end of this decade, would it be possible to reduce
the cost by 75 percent. Why 75 percent? That is the cost where
solar power becomes competitive with any form of energy that we
have today, the cheapest fossil fuel, and at that point the
country that develops that has all of a sudden got a clear
winner that you can export all over the world, the country and
companies that develop that technology. That price point will
be a very magical price point.
Remarkably, in this game plan that we started developing--
and we didn't know which technologies would win. There is
silken, there is crystal and silk and various thin-film
technologies. There is even solar thermal. And all of these we
looked and we said okay, what we can do is construct a program
to give everyone a shot at this. They can all apply for grants.
But where you see a clear driver down to this magical price.
And the reaction in industry was actually amazing. I was
talking with the CEO of Sun Power, a former professor of
Stanford, Dick Swanson, who is now making the most efficient
solar modules in the world, over 20 percent efficient, and he
said, you know, you were great because after your guys started
talking to us and we went and we started talking to our
engineers, they began to realize yes, they can do better. This
is amazing, that, you know, your spurring us and the back and
forth between our scientists and their scientists, you know
what, we can do better than we were planning to do. And so what
this is now is a technological race among various approaches in
the United States where the winner will reap many rewards. And
so this is a very exciting thing.
When President Kennedy following President Eisenhower's
speech about Sputnik and, you know--I might remind this
committee, by the way, when Sputnik was first launched, his
reaction to Sputnik is to say we have to invest in science and
technology and education in science. He did not say let us put
more money into rocket science and the military. It was a very
long, far-reaching goal and said this is what it is about, the
Russians have more scientists and engineers and the quality of
their education is increasing and for the long-term benefit of
the country this is what we have to invest in. It helps to have
a five-star general to say this. And that started the National
Science Foundation and all these other things.
So now returning back to the sun shot, we are very excited
about this so going back to Kennedy, when Kennedy said before
the end of the decade we will have a man on the moon, I am sure
there are people in the audience and in America and worldwide
who said that guy is nuts, how are we going to do this, but he
wasn't. Before he made that announcement, he had a lot of
detailed discussions with his scientific team, with the
engineers and with the NASA folks to say no, this is bold, this
is a long reach but it is achievable.
Mr. Miller. Thank you. With my remaining 15 minutes, I
wanted to ask about research generally.
Obviously energy research fared very badly in the
Continuing Resolution passed by the House three weeks ago, and
the argument by those who oppose the research was that it was
really applied research, not basic research. I am not sure they
are really any more favorably disposed towards basic research.
But it is not like there is a bell that goes off when basic
research crosses over into applied research, and the horizon of
when some of this stuff may be commercially practical is pretty
far out there, even if it is strictly speaking basic research.
What would happen to energy research generally if DOE was
out of the mix of doing what would be called applied research,
and is it really true that energy research by your department
is crowding out--is it skewing--the marketplaceis it picking
winners or losers, is it really crowding out research the
private sector would otherwise be doing?
Secretary Chu. The short answer is no but let me follow up
by giving you a few examples. If you look, for example, at what
we are funding in the applied research area in things like
better air conditioning or better manufacturing practices for
photo cells, this is in our ARPA-E program. We made our first
tranche of funds. We invested in, I think, something like 37
projects, 37 companies, and these companies already half a
dozen receiving grants on the $3 million to $4 million for two
years and then after that it is over. You have to go get money
from another program, the private sector somewhere. Half a
dozen companies have already done the research that they can
then go back to the investment community and say look, it is
working, and those half a dozen companies have received over
$100 million of private sector funding because they proved
using our research dollars to do first-stage proof of
principle, the private investors said we think it is going to
work, here is some more money.
This is exactly what we want to do in the private sector.
Were we crowding out the money? No. In fact, if they couldn't
prove to the private sector, the investment community, the VC
people that this is actually viable by doing that first little
experiment, they wouldn't have gotten the money. But as soon as
they get the money--I mean, we well imagined that in many of
these companies that first $100 million will actually be
generating hundreds and hundreds of millions of dollars as it
looks more and more likely that it will be a winner.
Mr. Miller. I thank the Chair for his indulgence.
Thank you, Secretary Chu.
Chairman Hall. I thank you, and thank you, Mr. Secretary.
I might remind the Members that we are even and even now on
time, and if we can kind of stick to our five minutes out of
respect to the other Members who are waiting. I will recognize
the chairman of I&O, Dr. Broun, for his five minutes.
Mr. Broun. Thank you, Mr. Chairman.
Secretary Chu, thank you for being with us here today. This
Committee requested documents regarding the Administration's
decision to cancel the Yucca Mountain projects on May 7, 2009,
February 3, 2010, July 20, 2010, and again on February 14,
2011. Until I became chair of the Investigation and Oversight
Subcommittee, I received little more than press releases from
your department and copies of letters from other Members of
Congress in response to these requests. Understanding that I
have requested these documents since May of 2009, when can I
expect a full and a final production of these documents, and do
you intend to withhold any of these documents?
Secretary Chu. No. My understanding is, we have now turned
over thousands of pages of documents to you and your staff.
Mr. Broun. Sir, we have not gotten the documentation and I
would appreciate your doing so as quickly as possible.
Secretary Chu. I will look into it but we----
Mr. Broun. If you intend to withhold documents, would you
provide an index to identify each document withheld, to state
the exemption claimed and explain how disclosure would damage
the interests protected by the claimed exemption?
Changing courses a little bit, in September 2008, you
stated, ``Somehow we have to figure out how to boost the price
of gasoline to the levels in Europe.'' Well, gas is projected
to go to $5 or $6 a gallon just this summer. We have an
unstable Middle East with potential of having a marked
reduction of Middle East oil being available. This will
increase the price of all goods and services and especially
food and other necessary things. It is going to destroy jobs
here in this economy and hurt our economy tremendously.
Sir, when is this Administration going to stop prohibiting
the development of our own God-given natural energy resources
here in the United States and start to pursue an all-of-the-
above energy policy and develop those particularly here in the
United States such as ANWR, OCS and those onshore?
Secretary Chu. Well, first, in my role as Secretary of
Energy, everything we are doing is to develop alternative fuels
to help drive down the price of oil because as we are
developing those----
Mr. Broun. Sir, that may be true, but we have got a lot of
oil available and it is not just about oil, it is natural gas,
it is coal, it is everything that we have, and this
Administration has been prohibiting the development of our own
resources. Congressman Bartlett showed us some slides that I
have seen and you have seen and all of us on this Committee
have seen, but this Administration is focusing on alternative
sources of energy, and I applaud that. We all applaud trying to
have more nuclear energy and that sort of thing but we have
energy sources that are available here today, and this
Administration is blocking the retrieval of those energy
sources.
I just beg of you, sir, work to start allowing us to tap
into all these energy resources including the oil and gas we
have today, and this Administration has been blocking the
production and development of those energy resources. It is
critical for our economy, it is critical for jobs, it is
critical for everything. So please, please, continue to look
for alternative sources, I applaud that, but we need an all-of-
the-above energy policy, not just looking to solar and wind and
battery production and those types of things. We have oil. We
have gas. We have coal. We have other sources. We have nuclear
energy. It is very difficult to get licensing. We need to
pursue an all-of-the-above energy policy, and I don't see this
Administration pursuing that, and I hope and pray for the good
of all the United States' citizens, for employees and employers
that we do so.
My time is up. Thank you so much.
Chairman Hall. Thank you for staying within your five
minutes.
The gentlelady from Ohio, Ms. Fudge.
Ms. Fudge. Thank you very much, Mr. Chairman, and thank
you, Dr. Chu.
Dr. Chu, I have one question for you. One of the issues
that I am most concerned with is the effects of energy
generation on public health which disproportionately affects
low-income urban communities like my district in Cleveland,
Ohio. Congress has spent time recently debating EPA regulations
and the Clean Air Act. One way to keep our air healthy is by
developing new and cleaner methods for energy generation. Could
you please describe for me within my five minutes some of DOE's
research and development activities that have contributed to
cleaner technology with a focus on public health?
Secretary Chu. Sure. Thank you. If the chairman would
permit, if I could spend maybe 30 seconds answering the last
question that Mr. Broun asked me?
Chairman Hall. Well, he----
Secretary Chu. He is still here, so it is good. I think
developing oil and gas resources in the United States is part
of the Administration policy, and the President did announce
opening access to more drilling in the Gulf with impeccable
timing. He announced that two weeks before the Macondo well
blowout. And we see that, and I agree with you. I think we do
need an all-of-the-above. You can develop oil and gas in the
United States but remember that is two percent of the known
reserves in the world and we are 25 percent. So as part of an
integrated policy, we feel that that is appropriate. And so----
Mr. Broun. I meant ANWR, and further putting out----
Ms. Fudge. I just want you to know this is not on my time,
Mr. Chairman.
Chairman Hall. We are going to start your time all over
again.
Secretary Chu. Okay. So--and--so as long as it is part of
an integrated policy, we see it is part, and all-of-the-above
is needed.
Mr. Broun. Thank you.
Secretary Chu. So in response to your question,
Congresswoman, I think if you look at the methods we are doing,
first, the Department of Energy has done a lot of research in
the capture of sulfur dioxide, nitrogen oxides, mercury
particulate matter. We were very helpful in the Clean Air Act
of 1992, I believe it was, in helping develop those
technologies that actually made it possible to capture the
pollutants that were creating the acid rain that was killing a
substantial part of our forests and lakes and rivers,
particularly in the Northeast, and that has been very
successful. The costs are about one-quarter, one-fifth of what
they initially were estimated to be and they are still
plunging. So the initial costs were overestimates because we
tend to underestimate how good technology becomes when given a
task.
Going forward, if you look at the types of technologies we
are now investing in research both the oxycombustion were you
burn it in carbon dioxide atmosphere and capture that both in
gasification, you are creating power plants that are
essentially pollution-free. The amount of particulate matter,
the mercury, SOx and NOx that are going to be released is going
to be near zero. And so this will go a long way to helping with
all the respiratory illnesses and deaths we now suffer in the
United States from those pollutants and the mercury that has
clearly invaded our rivers and lakes.
Ms. Fudge. Okay. I would just ask that as you go forward,
though, that you pay particular interest to what goes on in
minority communities because I believe that you will find the
incidence of the effects of these things that you just talked
about are higher in communities that are minority communities.
Thank you very much.
Mr. Chairman, I yield back.
Chairman Hall. I thank you for yielding back.
The chair now recognizes the gentleman from Tennessee, Mr.
Fleischmann.
Mr. Fleischmann. Thank you, Mr. Chairman.
Mr. Secretary, Chuck Fleischmann. I represent Tennessee
three, which has the great national treasure of ORNL and Y12.
Thank you for being here today.
Mr. Secretary, it is encouraging to see your support for
nuclear power, specifically for small modular reactors or what
we call SMRs, which will be an important source of energy for
the increasing electricity demands of our country. Recently I
met with Deputy Secretary Poneman. He visited with me and we
talked about the importance of an American nuclear industry. In
my district, the Tennessee Valley Authority is looking to add
additional nuclear power to its system using SMR technology.
The Oak Ridge National Laboratory and the Y12 weapons complex
are big energy consumers and require safe, affordable and
reliable power for major science and national security needs.
It is impressive that your department is making progress on a
cost-share program but there is also a regulatory hurdle which
has been brought to my attention.
The Department of Energy apparently is prohibited by a
federal directive from long-term contracts with utility
companies on power purchase agreements. This is a serious
roadblock. How will DOE handle the need for long-term power
purchase agreements, sir?
Secretary Chu. All right. I will certainly look into that.
There are numerous roadblocks like that. I think it has to do
with utility companies and traditional power providers
protecting their turf, and so we will look into it and see if
we can come to some accommodation. I certainly know within the
TVA, I have met with the head of the TVA, that they are very
keen. They have a number of very old coal plants that are
really at the end or past the end of their life, very
inefficient plants, highly polluting plants, and they look at
small modular reactors as a possible substitute solution to
that. They are small enough that they can be dropped in
substitutes for these coal plants because the electricity
transmission distribution infrastructure is matched to the
smaller reactors.
And so we are very keen on that. In fact, in Oak Ridge
there is the Cinch River site, which could be an ideal first
adopter of small modular reactor there that could power all of
Oak Ridge, and as you know, we are investing--in the fiscal
year 2012 budget we are asking for funds, and we hope Congress
can give us these funds so that we can help a number of
companies accelerate the licensing and processing, to help them
with their engineering drawings that the NRC would demand, but
I plan to look into that and get back to you on the regulatory
hurdles of what would prevent us from generating power.
Mr. Fleischmann. Thank you. I have one follow-up question
in my time remaining. Recently I visited the Oak Ridge National
Lab and I had the pleasure of a district tour and saw the
Jaguar, which was I think until recently the world's fastest
unclassified computer. It was a wonderful tour. Last November,
though, the Chinese edged out the United States in
supercomputing speed. China holds the record on two of the top
five fastest computers of the world. That one measurement, Mr.
Secretary, doesn't tell the full story since the United States
maintains an impressive lead, I think, in supercomputing with
half of the world's top 500 supercomputers located in the
United States.
My question, Mr. Secretary, is, what is the Department's
long-term strategy to ensure that we don't cede our Nation's
premier leadership position in advanced computing?
Secretary Chu. Yes. We in our 2012 budget are requesting
funds to start a new sustained project in going to the next
level. The Jaguar computer is what we call a petaflop. A
petaflop is 10 to the 12 floating point operations per second
or more. That is a lot of floating point operations, 10 to the
12. No, this is 10 to the 15. Sorry. And so the next
thousandfold development of a computer that is a thousand times
faster than the Jaguar is something that we would like to
develop in our 2012 budget. We have culled money from other
parts of the Department including the National Security Agency
as well as Office of Science to develop a roadmap and a plan to
get us to this new exascale, so called exascale computer.
We believe that these high-performance computers are not
only incredible--we need them for our nuclear security and for
the science but we have also found recently in the last,
certainly in the last half decade that these simulations are so
good, you can actually design things like a new diesel internal
combustion engine and you can simulate the very complex
dynamics of what is happening in this diesel engine and all the
chemical reactions that are occurring at this, you know,
thousandth of a second and shorter time scales and so Cummins
Diesel was able to use our supercomputers to design an engine
to skip the prototype design and they went right to
manufacturing, and saved the development of a new engine 15
percent of the cost.
We are using these supercomputers to design the next
generation of nuclear reactors the same way because we are
looking towards the next generation in carbon capture and
sequestration but what we are finding is that the simulation
ability of these computers is so good now, you begin to skip
design stages where you make it, see if it works, twiddle
around with it, make it, see if it works, twiddle around with
it. You make it on a computer, see if it works on a computer
and you can twiddle a lot better on a computer. And so this is
a real economic opportunity and we do not want to lose that
leadership.
Mr. Fleischmann. Thank you, Mr. Secretary.
Thank you, Mr. Chairman.
Chairman Hall. I thank you.
I now know how you won the Nobel Prize. When they asked you
a question, by golly, you answered it. And I am going to give a
Nobel Prize for patience to Mr. Sarbanes but he left. If he
comes back, we will recognize him first next time, okay? At
this time I recognize Mr. McNerney, the gentleman from
California.
Mr. McNerney. Thank you, Mr. Chairman.
Thank you, Mr. Secretary, for appearing before us. Your
discussion on the lithium batteries hit home personally because
of my experience in industry. I spent 20 years developing wind
energy technology, and because of poor government policy, I saw
that technology go overseas, particularly to Germany at first
and then to India and produce jobs in those countries, real
jobs that should have been produced here in this country. So I
am very concerned about that deja vu happening again with our
current Continuing Resolution.
Now, I have always thought that our universities are the
premier--University of California, University of Texas,
University of North Carolina and so on, Stanford and Harvard--
for producing an environment of innovation and technology
development and so on, and I would like to see what your
opinion is in terms of how this sort of budgeting will affect
those institutions vis-a-vis comparison to universities in
other countries.
Secretary Chu. Yes. Thank you for that question, very much
so thank you. The research universities in the United States
are still the greatest research universities in the world, bar
none. There is still something very, very good about the way we
educate our graduate students. It may be deeply in our culture
because in research it is very different than textbook
learning. You don't know what the answer is. There is no
authority to tell you this is right and that is wrong. And so
you actually have to be probing and you are constantly
questioning, being able to question authority, and for whatever
reason, the American research universities are very good. So
the most innovative, creative things, and the world recognizes
this. But they are also working very hard to try to duplicate
those atmospheres in other countries.
Now, specifically your question, if we start throttling
back in funding for not only the Department of Energy but the
NSF, the NIH and others but the Department of Energy, I think
most people don't realize is the largest funder of the physical
sciences in the United States. It has funded the work of more
Nobel laureates than any other funding agency in the world, and
it has trained scores of Nobel laureates. When I was a graduate
student at Berkeley, a postdoc at Berkeley, I was also a member
of Lawrence Berkeley National Lab. That lab alone helped start
the careers of 30 people that went on to get Nobel Prizes, a
national laboratory. And so the funding cuts that we see, I see
the whole thing being put at risk where the real engine driver
for all this innovation, which is the research universities and
those national labs, are then put at risk. And so one can come
back 10 or 20 years from today and say oops.
Now, China is working very, very hard to develop their
universities. They have now begun to lure back Chinese who have
gotten their Ph.D.s and postdocs and have been professors here
or work in companies here to come back now in their 30s and 40s
to assume leadership positions in academia and industry and so
these are not the people who are 65 but these are the people in
their--because they see great opportunity there, and there is
great opportunity there. So we cannot take for granted all the
people that came to get educated in the United States. If they
see oh, no more research funding in the United States, they are
going to have to look elsewhere.
Mr. McNerney. I have time to ask at least one more
question. Lawrence Livermore Laboratories is adjacent to my
district and many of the employees that work there live in my
district. I have been following the National Ignition Facility
progress with great interest. Could you talk a little bit about
the potential for fusion technology and our leadership in that
area?
Secretary Chu. Sure. The NIF facility, it was initially
funded for defense so that if you wanted to actually test what
is happening at these very high energies and implosions, this
is a way of doing it without nuclear testing. And so we can--
and it is part of our stockpile stewardship program. Now,
having said that, the fact is that these lasers, what they do
is, there is a little pellet, really small, hundreds of
microns, huge laser power then generates X-rays that compress
this. The Office of Science has now gotten very interested in
this because to be able to bring this fantastic amount of
energy and power to actually create a microthermonuclear
explosion. If--now, many things have to happen. That means that
you are now creating fusion energy, and NIF within a very short
time will go what they call where you get a huge output, much
more power out than in, and you will get a thermonuclear
implosion of these little itty bitty pellets. And so there is a
group there at Livermore who thinks that it may be possible
that this could lead to a source of fusion power.
Now, having said that, I think this is still very
researchy. You have to develop a laser system that is
economical, that can work 10 or 20 times a second instead of
one or two times a day but it has to work very reliably at that
rate because this is turning on our lights and keeping our
lights on. And so it is in the future but we have that
possibility and so again, in this vein of research, there is
another approach to fusion energy.
Mr. McNerney. Thank you, Mr. Chairman. I would like to
dedicate the negative balance to the other side.
Chairman Hall. Thank you. You are pretty close and I
respect you for it.
At this time I recognize Mrs. Biggert, the gentlelady from
Illinois, for five minutes.
Mrs. Biggert. Thank you very much, Mr. Chairman.
Mr. Secretary, thank you for being here today. It is nice
to see you again, and I apologize for not being here for your
testimony as I have been in a markup and we haven't even gotten
through the first amendment of the first bill.
But I just wanted to ask you a couple questions, and I
think that you know my long history of support for the Office
of Science and I have always maintained that scientific
leadership in this country will create the jobs of the future
and keep our country competitive, and I know you agree with
that. But considering the budget decisions that we face, how
would you strategically conserve spending with the department
while preserving programs that are integral to our scientific
enterprise and international leadership? And specifically basic
energy sciences and computing come to mind. And China's latest
supercomputer is a threat to our leadership computing
capabilities and we are on the cusp of outpacing them unless
U.S. research is not prioritized responsibly. So do you have
any suggestions that might help us strategically prioritize our
basic research programs within the budget constraints that we
face?
Secretary Chu. Sure. First of all, you know, whatever
Congress decides to give the Department of Energy, I hope I
would be asked to be a partner in the funding decisions, but I
will tip my hand and tell you what my leanings are. If we have
a diminished budget, I would tend to push to make less
investments on the deployment side, the very applied side, the
parts where we are helping industry get it out in the field. We
would just hope that we can structure policies that would
induce private investments. I think the most precious part of
our budget is the part that will be continuing to lay the seeds
that give you the innovations five years and ten years and 15
years, and that is the Office of Science. And next to the
Office of Science is ARPA-E but ARPA-E is not in competition
with the Office of Science. ARPA-E is an applied research
program, a much shorter term, and it should be seen as part of
the applied area, okay. The Office of Science does investment
in a different time scale.
Mrs. Biggert. I am glad to hear that you say that because I
think that the risk science really is in the Office of Science.
Secretary Chu. Yes. You weren't here when I was bragging
about an event that happened in Argonne National Laboratory. I
didn't identify it as Argonne National Laboratory but the
research in the Singatron facility there that led to the new
lithium ion battery and the addition of manganese was research
done at Argonne National Laboratory and it was done and was
considered basic research but within a very short time it was
licensed and its findings went into the Chevy Volt battery. And
so that is a beautiful example of how science can actually
deliver the goods, sometimes in much shorter time scale than
one would ever expect.
Mrs. Biggert. Well, I just had the opportunity to drive a
Chevy Volt this morning, so it is quite a car. I didn't drive
it too fast or too far away. They wouldn't let me put it on the
road for racing.
Secondly, I wanted to ask about the term ``energy
efficiency.'' It is something that many of us have embraced as
an all-of-the-above energy approach, and I understand the
department is trying to reduce its energy and emissions
footprint as part of a department-wide initiative, an Executive
Order across all sectors of the government. So under those
guidelines, is there any concern for our large-scale user
facilities and the amount of power that they would consume?
Secretary Chu. Yes, there is a great deal of concern for
those because in many instances, they do consume a lot of
power. Now, the good news is, for example, going to
supercomputers, the Jaguar computer at Oak Ridge, for example,
or the supercomputer at Argonne consume tremendous amounts of
power but the Department of Energy is very focused on
developing research so the next generation of supercomputers on
a per-unit calculational basis should be consuming several
hundred times less power per operation, and we think this is
possible. In fact, it is not only possible, if you don't
decrease the energy appetite a hundred fold, 300 fold, you
can't actually get to the next level of computing which we
think we will need. And so we think it is going to--so a large
part of what we do now when we design new accelerators, new
computers that consume a lot of power is, the power management
and the energy consumption is a very integral part of what is
going on.
Mrs. Biggert. And would that affect the advanced photon
source too?
Secretary Chu. Yes, but remember, the other thing we would
like to do is, we would like to get a few of these things. We
would like to get a few small modular reactors going, so all of
a sudden now you have clean power than can deliver as well
because there are certain things--but even in accelerators, the
last generation built accelerators, for example, the Large
Hadron Collider at Cern, it is superconducting and it actually
consumes less power than one of the little injectors. And so
again, this attention to--we can't use our entire science
budget to run the electricity is very much part of the culture
now.
Mrs. Biggert. I thank you. My time is expired.
Chairman Hall. I thank the gentlelady.
I will now quickly recognize the gentleman from Michigan,
Mr. Clarke.
Mr. Clarke. Thank you, Chairman Hall, and I want to thank
the gentlelady from Illinois for that great transition
regarding the Chevy Volt. I represent the district that
produces the Chevy Volt, and your department has helped promote
that technology in vehicle electrification that is going to put
Detroit back on the map. In fact, it is already on the map in
terms of now developing the best electrified vehicles in the
world.
Your department through its basic materials science for
battery chemistries, your applied research for onboard power
electronics and also the modeling for preparation of the
electric charging infrastructure all happens within different
offices within your department. I am thankful for your support.
But others might say that this may not be an efficient way to
allocate department resources. The Government Accountability
Office, I know they have looked in areas of government where we
can be more efficient, where we can reduce or eliminate waste
and duplication. How has your department fared under this GAO
review?
Secretary Chu. So far we have fared very well but there is
no telling what will happen, you know, next week or next month.
I think the GAO review was very kind to us, but to your point
about duplication, let me tell you what we are doing.
You mentioned the battery program. The battery program is
supported in three major areas. There is the more basics
physics chemistry part of the batteries which is in the Office
of Science in the energy efficiency renewable section, we have
a very strong battery group, and now ARPA-E has a battery
group. And so in the last half year and going forward forever
on--and I was in a review for about an hour, a little over an
hour looking at the detailed things they were planning and what
they were supporting and what the prospects were, but all three
groups were in the room, and going forward what we are doing
is, we--if you think any sector, batteries, transmission
distribution, biofuels, advanced biofuels, photovoltaics, what
we are doing is, we are putting into teams that cut across the
formal organizational lines. For example, in our SunShot, we
hired a young engineer, youngish engineer, Ramesh. We got him
to come to the Department of Energy, give up a little of his
life to be in charge of SunShot. He just got elected to--you
know, he is in his 40s. He just got elected to the National
Academy of Engineering. He had a very good situation. Why would
he ever want to come to the government? Because he could then
cut across all these organizations and said we are going to
have a unified plan to develop how are we going to help
industry get there and be the winner, and what can we do in the
Department of Energy, what can we do in the research to fill in
the spaces where industry might not want to invest in but
industry tells us this is the most important thing, okay, but
it may be too forward-looking for them to invest in it, given
the constraints of their shareholders or their founders.
So we are tackling this in a very different way because
what I found when I became the Secretary is there would be a
very good group in a certain area but they wouldn't even know
what the groups in another area were doing. Biofuels were in
the applied area I was looking at--they brought in a very good
guy who was developing a program. They gave me his plan. You
know, I take these and I put all sorts of comments and type all
over it. But then what I did is, I took that plan and I gave it
to the three directors of the biofuel centers that are
supported by the Office of Science because they hadn't--this is
the plan they have, these are my comments, what do you think
about this, where do you think industry is, where do you think
this is going. Within two days they come back to me. I take
those plans and give them back to the applied area and I said
from here in we are going to be doing it that way. Biofuels has
now become an integral part of all the areas, and also ARPA-E,
so that all the expertise then comes together in a room and
figure out a unified plan and so this is a new way of doing
business. I think it is the right way of doing it.
They still have their own particular things, whether short-
term, very short-term applied research or helping with
deployment or the longer term. They still have their own parts
but at least they will know intimately what everybody is doing
and they will coordinate it. And there is actually a very nice
buzz about that because what people are finding is, there is
excellence in little bits and pieces that they hadn't known
before. This I something I learned when I was a young science
nine years at Bell Labs because as a manager at Bell Labs, that
was my job: find out what everybody is doing in the whole
organization and then link up a scientist in my group with
someone else far away and then let the sparks fly, and so that
is what is happening.
Mr. Clarke. Thank you, Secretary, Mr. Chair.
Chairman Hall. Thank you very much.
Mr. Clarke. I wonder if I could make one brief point
regarding Michigan State University.
Chairman Hall. Without objection.
Mr. Clarke. Thank you, Mr. Chair. I really appreciate this
very much. This is just very brief. It is just a transition on
how we can balance, you know, our efforts between research and
development and your department has supported--your Office of
Science has supported researchers around the country,
especially in Michigan. I want to commend the progress of one
of the greatest land-grant universities in this country,
Michigan State University, its work on the facility for rare
isotope beams, and thank you again for your support. How does
this proposed budget strike a balance between----
Chairman Hall. The Secretary will give a brief answer.
Secretary Chu. Very, very briefly, the proposed budget
wants to support that and get the construction going on that
but, you know, it depends on what Congress gives us for the
budget. I mean, projects like that would be at risk.
Chairman Hall. Mr. Hultgren of Illinois.
Mr. Hultgren. Thank you, Mr. Chairman. Thank you, Dr. Chu.
I am concerned about the funding for DOE's Office of
Science and specifically the high-energy physics program there,
which is clearly in a period of transition right now. The
Administration has notified Congress it intends to shut down
the Tevatron at Fermilab. I met with--and that is ending here
in fiscal year 2011. I met with Fermilab many times, and I know
that with that record-breaking machine and all that has been
accomplished there, Fermilab is ready to transition to new
programs, one of them including the Long-Baseline Neutrino
Experiment. The LBNE is to be the anchor project for the Deep
Underground Science and Engineering Laboratory at the Homestead
Mine of South Dakota, as you know. It is my understanding that
the President has proposed $32 million for DUSEL and for LBNE
in is fiscal year 2012 budget request for DOE. I also
understand the department stepped in when it became clear that
a new stewardship agreement would be needed between DOE and NSF
while a study is conducted and decisions are made on the path
forward for these projects.
A couple questions I had just on the situation, and we have
talked quite a bit about it, of really the importance of having
basic research and all that our laboratories have brought to
us. The President's fiscal year 2012 budget request total is
$797.2 million for high-energy physics overall. It really does
amount to a freeze at the fiscal year 2010 enacted levels when
other projects within the Office of Science are slated to
increase from 21 to 24 percent. My question is, why is there
such an imbalance in the basic research portfolio of the Office
of Science?
Secretary Chu. Yeah, that is a tough decision but let me
explain what our thinking was on that. First, it does not mean
we want to see an end to high-energy physics and also
fundamental nuclear physics and cosmology. Those are very, very
basic things, and out of that research came amazing things.
Just the fact that we have particle accelerators that gave us
Singatrons and light sources and neutron sources, actually its
roots were in high-energy physics.
Mr. Hultgren. Right.
Secretary Chu. And so it is a very, very direct connection
between what you do in research in one area and how it can
transform into science or medical research. Right now, yes, we
are closing down the Tevatron. There was a move to keep it open
for three additional years because the Large Hadron Collider at
Cern had a mishap with their magnets, and they thought that if
you keep that machine running for another three years, maybe
you can--you know, they are looking for the higs and maybe you
can square it under and perhaps discover the higs while they
are fixing their machine, and in the end what happened was, the
Large Hadron Collider got their machine up and running and in
the last several months it was--they were able to tweak it up
and tune it up far faster than we thought they could actually
get it up. And then if you look at the flots and the number of
vents coming out of that machine and the higher energy, then
the decision became very clear. You know, you are not on the
verge of--they weren't on the verge of anything, and the Large
Hadron Collider would blow them away.
So the Department of Energy and the director of the
laboratory said we shouldn't do this because this is about $35
million a year to keep it running, we would rather take that
money and invest it in the high-intensity frontier, which you
also spoke about. This is using a new machine to create a lot
of neutrinos to look at the neutrino sector, and we think that
that is the right decision because this other machine in Europe
is just--would smoke us.
And so we want to continue high-energy research in the
United States. I mean, the sad part, as you know, is, you know,
we could have maintained leadership in this field had we built
the Superconducting Super Collider, the SSC, in Texas, but that
is water under the bridge. We still think high-energy physics--
and the questions in physics and cosmology are asking the most
primal roots of science, what is matter, what is energy, okay,
and we think that this is still some of the most exciting
frontiers in physics but right now we are trying to figure out,
okay, given this big investment in Cern, which we then fund
American universities and researchers to go over there, we
still need something here in the United States that we can call
our own, and we think that this high-intensity frontier is
that.
But we are going through a tough decision. The high-energy
physics community is wrestling with it themselves, what is the
best--we don't want just--you know, this is an austere budget
time so we can't just continue funding on a certain level. When
the great new thing comes along, then I could easily see us
coming back up. But right now, that is the plan.
Mr. Hultgren. Just quickly, I don't--I think it is--I hope
that happens but I think it is difficult now when the top
scientists are going to Cern rather than staying here, and I
hope that is what could happen.
Mr. Chairman, if I could have just 30 seconds quickly
specifically on the LBNE?
I just want to ask you the current status and the
commitment, are the resources there to be able to continue with
LBNE and also with DUSEL?
Secretary Chu. Well, as you know, very quickly, the NSF
actually started this project and we became partners and then
the NSF decided not to, and there were three critical
experiments that we felt we wanted to have continue but again
in these very hard budget times, we are going to try wrestle
with--we would like to--it can't be the underground laboratory
that was envisioned with both NSF and DOE support but we have a
committee now that is assigned to look at what is the best--
given whatever budgets we get from Congress, what are the
things we can and can't do. And so that committee has just been
appointed and they will be reporting back, but they have just
been formed. But we would like to see it continue the best we
can. Again, this is about money.
Mr. Hultgren. Thank you. Just in closing, Mr. Chairman,
thank you so much, Dr. Chu, and I do really appreciate your
statements earlier when times are tight, I do think we have to
make sure that we still have that commitment to basic research
where the private sector won't necessarily do that work, but
this is an important function of government. Thank you very
much.
Chairman Hall. I was hoping for a yes or no answer but I
didn't get it.
Mr. Lujan, we recognize you at this time.
Mr. Lujan. Mr. Chairman, I appreciate that. I believe that
the appropriate answer would be yes, Mr. Chairman.
With that, Mr. Secretary, I want to thank you for being
here as well, and if you will indulge me, I am going to try to
get through most of this, Mr. Secretary, and there are a few
questions within my remarks, and if we are not able to get to
them, if I could ask that maybe we just get a response in
writing.
I very much agree with your and President Obama's drive to
invest in education and research and development and innovation
in order to better position our Nation for the future.
Investing in R&D is key. We have heard it time and time again,
and especially building off of the closing of my friend that
just shared some remarks with us. We know that our Nation's
competitiveness and our national security depend on it, and I
know you are very well aware of the significant role that the
people in my district and the people of the State of New Mexico
play in both of these areas. Still, the future benefits and the
full benefits of R&D can only be realized by coupling R&D with
innovation in the marketplace so that there is a seamless
transition from the advances in basic science and new technical
capabilities all the way through to new technologies that
generate new businesses and new jobs. Other countries are
making good use of our scientific advances and we must do
better.
I therefore commend you on your efforts with ARPA-E and the
hubs to promote innovation in targeted areas of national
importance. But there is a need to promote innovation and
technology transfer more broadly from the top to the bottom and
from the bottom to the top. I along with co-chair Frank Wolf
have started the Congressional Technology Transfer Caucus to
help educate Members on the important issues and barriers to
technology transfer. The Department is home to our Nation's
national laboratories which serve as an incredible resource for
both developing new technologies from which new businesses and
new jobs can spring as well for providing technical assistance
to businesses. Yet listening to small business owners and
entrepreneurs leads me to believe that there is much room for
improvement in the Department's technology transfer activities.
For example, a very few of the Department's Cooperative
Research and Development Agreements, otherwise known as CRADAs,
which is a common mechanism for private equity to work with the
national laboratory to mature technology, are supported even in
part by Department funds. Most are 100 percent funded by
private equity, which is prohibitively expensive for many small
businesses. Furthermore, the private entity is often required
to pay out a significant fraction of the cost to the project up
front before the work will even begin. This too is prohibitive,
and I understand that there is more need for us to support
maturation and seed programs by the Federal Government to help
spur this innovative and ingenuity aspect of the private
sector.
I know that your Technology Transfer Coordinator has been
working with Technology Transfer Working Groups on ways to
improve the Department's tech transfer activities. One question
I have, Mr. Secretary, what specific actions do you expect the
Department to take in the next year to invigorate tech transfer
activities and to do any of them including dedicating more
funds and reducing barriers to small businesses?
Mr. Secretary, recently, as you may be aware, in New Mexico
we experienced record-breaking freezing temperatures that
caused a significant increase in the peak for natural gas. The
increase in demand led to severe disruption in our natural gas
distribution system, causing outages across the state. This was
coupled with outages in ERCOT and the Texas energy markets.
Over 30,000 homes were left without power to heat their homes.
Currently FERC is conducting an investigation into this.
Considering this crisis, I would like to emphasize the
importance of supporting the R&D of natural gas technologies to
ensure that the overall security of natural gas deliverability
to systems in New Mexico and across the country, especially
when we talk about powering our vehicles with this important
fuel source.
The recent National Academy of Sciences report, ``Expanding
Underrepresented Minority Participation: America's Science and
Technology Talent at the Crossroads,'' makes clear that we must
continue our efforts to increase minority participation in
STEM. In 2007, underrepresented minorities comprised 33.2
percent of the U.S. college-age population and 26.2 percent of
undergraduate enrollment yet only 17.7 percent of those were
earning science and engineering bachelor's degrees. I would be
interested, Mr. Secretary, on hearing on DOE's plans to develop
a diverse pipeline of STEM professionals in the energy sector,
especially in light of correspondence both myself and Senator
Bingaman's office have shared.
And lastly, Mr. Secretary, I apologize. I am going to have
to sit to listen to some other responses. In closing, in your
remarks you highlight the need to accelerate creation of jobs
from R&D investments by increasing the pace of movement from
discovery to the marketplace, and I applaud those. What is the
DOE doing to improve and streamline the mechanisms for
technology transfer from the national labs, especially to small
entrepreneurial companies, other than ARPA-E, which has
targeted investments in a small number of companies and
technologies? What is DOE's strategy to improve the success
rate and engaging in the private sector in a technology
transfer earlier in the R&D cycle?
Mr. Chairman, I appreciate the indulgence there.
Mr. Secretary, I look forward to getting those responses
but applaud you on your efforts on the emphasis with making
sure that we are taking this seriously. Thank you, sir.
Chairman Hall. I thank the gentleman.
Mr. Cravaack, who is going to receive the Nobel Prize for
patience, he has been here the entire time, I recognize you,
sir.
Mr. Cravaack. Thank you very much, sir, I appreciate it,
and thank you, I appreciate you coming here today.
I appreciate your comments regarding austere conditions. We
are as a country definitely in austere conditions, and I am
finding it very difficult to find the relationship between the
Department of Energy and Tinkerbell. Put up the ad, please.
Thank you very much.
[The information follows:]

Mr. Cravaack. You have an extensive website geared towards
educating children and putting out a pretty extensive website
having children talk to their parents about making sure they
have Energy Star appliances, programmable digital thermostats
and home improvements in animated videos. I think it is called
Save Energy with Tinkerbell and Her Friends, which is, you
know, I understand it. I am a dad. I get it. But unfortunately,
we are at a $1.6 trillion deficit, national debt, and $14
trillion in debt. Right now in your budget you are requesting a
44 percent increase in the office to fund these efforts,
according to my calculations. You may be telling me I am wrong
here by your face. If these are funded, how do we think--you
know, I question your putting a 44 percent increase in a budget
on these type of programs when we are in such austere
conditions as you noted. Do you have any empirical evidence
that would provide that these advertisements actually change
habits, parents' behavior and attitudes towards energy
consumption?
Secretary Chu. You meant 44 percent increase in this
budget?
Mr. Cravaack. Correct, in advertising.
Secretary Chu. That I wouldn't know about. Is there
empirical evidence? No. We do have backward empirical evidence
that advertising to kids to try to get their parents to stop
smoking was effective.
Mr. Cravaack. Well, like I said, in these austere times I
just question whoever put this in the budget, and I question
what other things are in the budget.
Switching gears here, what actions do you see, especially
with the rise of the Chinese developing a deep-water fleet, if
our supply lines were shut down? Would we have enough domestic
energy production to be able to counter any type of advancement
of foreign power?
Secretary Chu. I am trying to interpret your question. I
think your question might have been what would happen if we
didn't have access to imported oil or was your question----
Mr. Cravaack. Correct me if I wrong. Isn't 70 percent of
our oil coming from out of state?
Secretary Chu. No, actually not. The latest number I saw
was about 51 percent. It is hovering between 50 and 60 percent.
Mr. Cravaack. My question is, if our shipping lanes were
shut down, Communist-bloc countries, we believe in maintaining
free lanes, they believe in shutting them down. So if we had
our free lanes shut down, our sea lanes shut down, would we be
able to wage an effective war? Do we have the domestic oil
supplies ready to go? Do we have the domestic reservoirs ready
to go? Do we have--can we gear up in enough time to defend this
country?
Secretary Chu. Well, actually, I think that I don't see
that as a real possibility. The United States Navy is by far
the most powerful Navy in the world, and so----
Mr. Cravaack. You didn't believe in Pearl Harbor, sir, so I
would question----
Secretary Chu. No, I believe in Pearl Harbor. I believe it
happened.
Mr. Cravaack. I am a naval officer, retired, 24 years. This
is an option.
Secretary Chu. But I do think certainly keeping the lanes
open is part of the Navy's job and it is because of our
dependency on foreign oil, and that is actually part of the
embedded price of oil, if you will, as you well know.
Mr. Cravaack. Yes, sir. My question, though, is if the sea
lanes were shut down, would we be able to man our fleet, making
sure that we would be able to be mobile enough to counter any
threat? And if not, why are we not developing our domestic
resources to a point where we can be at that point? And for the
record, sir, I would like to submit this for the record.
Chairman Hall. Without objection.

[The information appears in the Appendix:]

Secretary Chu. So very quickly to respond to that, you
know, as has been pointed out by numerous people here, we
consume 25 percent of the oil and we have two percent of the
reserves, and so the way we change this situation is to
actually transition and get substitutes for oil in the sense
that--and this is a long-term thing so we have got to start
immediately but the electrification----
Mr. Cravaack. Sir, in our current situation right now,
would we be able to man and fuel our fleets if the sea lanes
were shut down?
Chairman Hall. A yes or no answer would do.
Secretary Chu. We have a Strategic Petroleum Reserve, which
is intended for emergencies like this.
Mr. Cravaack. Is it sustainable?
Secretary Chu. I think it is sustainable in enough time for
our Navy to clear and open up the sea lanes.
Mr. Cravaack. I would beg to differ. Thank you very much
for your time.
I appreciate the indulgence. I will yield back my negative
balance. Thank you.
Chairman Hall. You don't have a bad negative balance. Some
good questions. Thank you.
Mr. Tonko, the gentleman from New York.
Mr. Tonko. Thank you, Chairman Hall, thank you, Ranking
Member Johnson, for holding today's hearing, and thank you,
Secretary Chu for your leadership and that of our President on
clean energy and what you have both described as our ``out-
innovating'' our competitors in a global clean energy race and
the need to win that race.
We cannot win the future, however, if we pull the rug out
from under our Nation's feet. We cannot afford to go backward,
and yet it seems as though that is certainly what the new
Majority in this House intends for us to do. According to Mark
Zandy, former Presidential candidates John McCain's economic
advisor, the C.R. or ``so be it'' spending bill would destroy
some 700,000 jobs. Federal Reserve Chair Ben Bernanke said
yesterday that it would cost at least a couple of hundred
thousand jobs, a number called ``not trivial.'' So it is with
that background that I approach you in this hearing today.
Mr. Secretary, skyrocketing gasoline prices are deeply
hurting the American public. In the capital district of New
York, consumers are paying at the pump about $3.57 per gallon.
Nationally, the average price is about $3.38 per gallon and it
continues to rise. Due to the continued conflict in North
Africa and the Middle East, oil is now over $100, as you know,
per barrel. For every $10-per-barrel rise in the price of oil,
America sends an additional $40 billion overseas yearly. Plain
and simple, we must start thinking outside the barrel so as to
create jobs and protect our national security. We are better
than the ancient fuel that we put into our vehicles, and I
believe that with Representative Bartlett's presentation he
reinforces the efforts to look outside the barrel. Using 19th
and 20th century oil subsides in this 21st century economy is
outdated and, in my opinion, foolish. We are literally giving
away hard-earned taxpayer money to big oil companies, and what
we get in return is sticker shock at the pump.
And so instead of cutting subsidies to Big Oil and CEOs
that are making record profits, we are cutting funding to
science, funding to innovation, to entrepreneurs and to our
middle class. The C.R. would slash funding for the Office of
Energy Efficiency and Renewable Energy budget by more than 35
percent, rescind American Recovery and Reinvestment Act loan
guarantee funding for renewable energy projects and cut funding
for energy efficiency programs that create jobs and reduce
homeowners' energy costs and carbon pollution.
Mr. Secretary, do you think it is wise to continue to
provide handouts to big oil companies, especially as prices at
the pump continue to skyrocket at a time when we must address
our debt and deficit?
Secretary Chu. No, I don't think it is wise. The President
has called for an end to the oil subsidies, which by his
reckoning is about $3.5 billion a year. But you also have to
put that in context, so these are tax break subsidies where the
profits of the oil companies in 2010 of just the four or five
major oil companies $75 billion. That is the profit, so the
revenues are in the hundreds of billions of dollars. So this
$3.5 or $3.9 billion subsidy is a little dimple on the overall
economics of oil and the cost of oil that I think the American
people should recognize. If you are making $75 billion--and
those are only the five majors. If you are making $75 billion,
if you add them up in total, it could be $100 billion. Three
point nine is not a big deal.
And so it won't have an effect on prices, and this is what
our program has been in the past two years, you know, higher
mileage standards, electrification of vehicles, do everything
you can to develop biofuels that would be substitutes for the
oil. So we diversify our transportation fuel supply. And when
we get electric vehicles or gas vehicles, natural gas-powered
vehicles, this is energy produced in the United States so
wealth remains in the United States, another big plus. So this
is the plan. We have got to decrease our dependency on oil and
diversify. Our transportation needs are almost exclusively
dependent on oil and we have got to diversify that, otherwise
we still will be hostage to these very unstable prices.
Mr. Tonko. Thank you. And according to the office of EERE,
the number of fuel cell and hydrogen megawatts shipped by nine
U.S. companies has increased by 40 percent in just one year,
and yet in my opinion the budget does not provide enough
funding for this critical technology. It is a proven technology
including some companies within the United States such as those
used for forklift applications that are commercially deployed
today. In your opinion, is there a role for fuel cells in
complementing renewable and traditional fuels?
Secretary Chu. Yes, there are, and we are trying to--these
are decisions--especially if you look at forklifts, there are
three alternatives. There is natural gas power for forklifts,
there is electric vehicles and then there are fuel cells. And
so we are looking very closely. All those are lower pollution
so especially in a city environment or building environment,
they are very clean.
In the longer range, and we are also looking very closely
what the automobile manufacturers are doing in fuel cells. It
all depends on what the battery technology is because for the
longer range, a fuel cell is an option. Ultimately we still
have to solve the hydrogen source problem. Right now, most of
our hydrogen comes from re-forming natural gas, and then you
still have the carbon dioxide from that natural gas, and so we
are also investing in research that says--very innovative
research--sunlight directly into hydrogen in a very low-cost
application. If you can do that, then the major hurdle is where
are we going to get the hydrogen.
Mr. Tonko. Mr. Chairman, I have a couple other questions
that I will enter through the Committee after the hearing.
Chairman Hall. I thank you for it.
Mr. Tonko. Thank you.
Chairman Hall. I would like to submit this article from the
Wall Street Journal that describes how companies like Whirlpool
and GE have banked enough green energy credits so that they
will not have to pay corporate taxes for years. I offer this as
a response to the claim that the Administration is not picking
winners and losers, particularly when the President suggests
increased taxes on oil and gas. Without objection, so ordered.
[The information follows:]

Chairman Hall. The chair recognizes Mr. Lipinski.
Mr. Lipinski. Thank you, Mr. Chairman. You saved the best
until last.
Dr. Chu, I appreciate all your work, especially in these
especially difficult times at this point. I know you share my
concerns about the rapidly rising costs of our dependence on
imported oil, and I think part of the solution to our energy
problems is the use of nuclear power along with vehicle
electrification. That is why I was particularly interested in a
portion of your written testimony that discusses cost-shared
activities with industry. It might help accelerate commercial
deployment of small modular reactors, and I know that you have
answered a number of questions on this and addressed this
already, so I just want to say specifically on SMRs, I think
the budget is a good start, though I would like to see an even
greater commitment to SMRs, but I know this is the first time
that DOE has actually--really put an effort and put the funding
behind helping to move these forward, and I would like to see
more of that in the future.
One other area, though, when it comes to nuclear power that
I am concerned about is that much of our skilled workforce is
near retirement and this includes skilled tradesmen and -women,
technicians as well as scientists and engineers including
thousands that work in your agency. So I just want to ask what
action is DOE taking to ensure that there is sufficient skilled
craftsmen and technicians to build America's clean energy
facilities and staff U.S. manufacturing facilities? Do you
think that we are doing enough on this?
Secretary Chu. I don't think we are doing enough but I
think people enter into job training and enter into, you know--
make choices in undergraduate, graduate school based on where
they think they can get jobs so ultimately it is very important
that the United States show signs that it can restart the
nuclear industry domestically at home, which means you build
more reactors. We were able to build--over a 20-year period, we
essentially started the entire fleet of nuclear reactors we
have today, over 100 were started within a 20-year period.
There was a long tail of finishing but never mind that. So I
think it is clear that the United States is willing to make the
investments in nuclear reactors here in the United States, and
again, the clean energy standard would be a major driver to
allow that to occur because it is a form of clean energy.
Then I think the supply lines, the trades people you talked
about, the engineers that would be needed in order to do this,
that all becomes part of the process. As long as you see that--
and that is why other countries want to stimulate the
production of new energy and new energy infrastructure because
all those things, then all the manufacturing capabilities are
usually built domestically because it doesn't make sense to set
up a very long supply chain, especially for the heavy products.
And so the clean energy standard would be the single-most
important thing you could say we are serious about reinvesting
in the United States power infrastructure and that would
include nuclear reactors, and all the other training and
everything will follow suit because they say I have a job.
Mr. Lipinski. I would like to go further with you on that,
but at this moment with the time I have left, I want to ask
about one other area. I was excited to see that the President's
budget shows a clear commitment to developing a more
sustainable industrial sector in the United States as evidenced
by the significant increase in the Industrial Technologies
Program, which helps manufacturers become more efficient. I
know the ITP program, especially the Industries of the Future
subprogram, has helped the American steel industry dramatically
reduce its energy consumption while increasing production. How
would the proposed increase in ITP and similar programs
contribute to the long-term viability of manufacturing in our
country?
Secretary Chu. I think it would be a great help. I think a
number of companies have bitten the bullet either with help
from the Federal Government or they did it on their own where
energy-intensive companies--Dow Chemical is a perfect example
of that where here is a company that--it takes carbon in the
form of oil and natural gas typically and converts it into
another form of carbon turns plastic, and it is a very heavily
energy-intensive transformation from one form of carbon to the
other, and so they are able to save tens of millions of dollars
a year now by driving to very high efficiencies, Dupont
similarly. So many, many companies are realizing you make
investments in energy efficiency in their industrial practices
and it is really good for the bottom line. I don't know whether
it is tens or hundreds of millions of dollars, I forget, but it
is a tremendous amount of money, very rapid return in capital,
all good things.
And so anything that the United States can do to help
companies make the transition to save money by saving energy,
it would be a very good thing.
Mr. Lipinski. One last thing. As the author of the H-Prize,
I was very happy to hear what you said in the answer to the
last question about the great potential advances in producing
hydrogen besides from natural gas. Thank you again for all your
work.
I yield back.
Chairman Hall. Thank you for your yield back, and I
certainly thank Dr. Chu for his very valuable testimony and the
members for their questions. I apologize for not running a more
youthful chair. I will try to do better. And I am going to give
Mr. Sarbanes half of my time when we meet on the next occasion
here, half of my opening statement to him where he will be
assured that he will get to ask questions.
And you have been so generous with your answers. The
members of the Committee may have additional questions for you,
and if you will, we will ask you to respond to those in
writing. The record will remain open for two weeks for
additional comments.
Dr. Chu, you and your fine staff are to be certainly
thanked for your accommodation of your time and the time it
took to prepare and the time it took for you to come over here.
I know you have been away from a very valuable job now for the
last couple of hours with us, and we thank you. This hearing
is----
Ms. Johnson. Mr. Chairman.
Chairman Hall. --not adjourned until Mrs. Johnson gets to
say what she wants to say.
Ms. Johnson. Thank you, Mr. Chairman. I want to thank Dr.
Chu, but I would like to request unanimous consent to enter two
articles in the record, one by George Will in reference to a
scientific engine and one by Morton Kondracke, who talks about
the American's seed corn.
Chairman Hall. Without objection, they are admitted.
Ms. Johnson. Thank you.

[The information appears in the Apendix:]

Chairman Hall. We are adjourned. Thank you.
Secretary Chu. Thank you, Mr. Chairman.
[Whereupon, at 12:15 p.m., the Committee was adjourned.]
Appendix I:

----------

Answers to Post-Hearing Questions

Responses by Dr. Steven Chu, Secretary, Department of Energy

[GRAPHIC] [TIFF OMITTED] T5049.090

[GRAPHIC] [TIFF OMITTED] T5049.091

[GRAPHIC] [TIFF OMITTED] T5049.001

[GRAPHIC] [TIFF OMITTED] T5049.002

[GRAPHIC] [TIFF OMITTED] T5049.003

[GRAPHIC] [TIFF OMITTED] T5049.004

[GRAPHIC] [TIFF OMITTED] T5049.005

[GRAPHIC] [TIFF OMITTED] T5049.006

[GRAPHIC] [TIFF OMITTED] T5049.007

[GRAPHIC] [TIFF OMITTED] T5049.092

[GRAPHIC] [TIFF OMITTED] T5049.008

[GRAPHIC] [TIFF OMITTED] T5049.009

[GRAPHIC] [TIFF OMITTED] T5049.010

[GRAPHIC] [TIFF OMITTED] T5049.011

[GRAPHIC] [TIFF OMITTED] T5049.012

[GRAPHIC] [TIFF OMITTED] T5049.013

[GRAPHIC] [TIFF OMITTED] T5049.014

[GRAPHIC] [TIFF OMITTED] T5049.015

[GRAPHIC] [TIFF OMITTED] T5049.016

[GRAPHIC] [TIFF OMITTED] T5049.017

[GRAPHIC] [TIFF OMITTED] T5049.018

[GRAPHIC] [TIFF OMITTED] T5049.019

[GRAPHIC] [TIFF OMITTED] T5049.093

[GRAPHIC] [TIFF OMITTED] T5049.094

[GRAPHIC] [TIFF OMITTED] T5049.095

[GRAPHIC] [TIFF OMITTED] T5049.096

[GRAPHIC] [TIFF OMITTED] T5049.097

[GRAPHIC] [TIFF OMITTED] T5049.098

[GRAPHIC] [TIFF OMITTED] T5049.099

[GRAPHIC] [TIFF OMITTED] T5049.100

[GRAPHIC] [TIFF OMITTED] T5049.101

[GRAPHIC] [TIFF OMITTED] T5049.102

[GRAPHIC] [TIFF OMITTED] T5049.103

[GRAPHIC] [TIFF OMITTED] T5049.021

[GRAPHIC] [TIFF OMITTED] T5049.020

[GRAPHIC] [TIFF OMITTED] T5049.104

[GRAPHIC] [TIFF OMITTED] T5049.105

[GRAPHIC] [TIFF OMITTED] T5049.106

[GRAPHIC] [TIFF OMITTED] T5049.107

[GRAPHIC] [TIFF OMITTED] T5049.108

[GRAPHIC] [TIFF OMITTED] T5049.109

[GRAPHIC] [TIFF OMITTED] T5049.110

[GRAPHIC] [TIFF OMITTED] T5049.111

[GRAPHIC] [TIFF OMITTED] T5049.022

[GRAPHIC] [TIFF OMITTED] T5049.023

[GRAPHIC] [TIFF OMITTED] T5049.024

[GRAPHIC] [TIFF OMITTED] T5049.025

[GRAPHIC] [TIFF OMITTED] T5049.026

[GRAPHIC] [TIFF OMITTED] T5049.027

[GRAPHIC] [TIFF OMITTED] T5049.028

[GRAPHIC] [TIFF OMITTED] T5049.029

[GRAPHIC] [TIFF OMITTED] T5049.030

[GRAPHIC] [TIFF OMITTED] T5049.031

[GRAPHIC] [TIFF OMITTED] T5049.032

[GRAPHIC] [TIFF OMITTED] T5049.033

[GRAPHIC] [TIFF OMITTED] T5049.034

[GRAPHIC] [TIFF OMITTED] T5049.035

[GRAPHIC] [TIFF OMITTED] T5049.036

[GRAPHIC] [TIFF OMITTED] T5049.037

[GRAPHIC] [TIFF OMITTED] T5049.038

[GRAPHIC] [TIFF OMITTED] T5049.039

[GRAPHIC] [TIFF OMITTED] T5049.040

[GRAPHIC] [TIFF OMITTED] T5049.041

[GRAPHIC] [TIFF OMITTED] T5049.042

[GRAPHIC] [TIFF OMITTED] T5049.043

[GRAPHIC] [TIFF OMITTED] T5049.044

[GRAPHIC] [TIFF OMITTED] T5049.045

[GRAPHIC] [TIFF OMITTED] T5049.046

[GRAPHIC] [TIFF OMITTED] T5049.047

[GRAPHIC] [TIFF OMITTED] T5049.112

[GRAPHIC] [TIFF OMITTED] T5049.113

[GRAPHIC] [TIFF OMITTED] T5049.114

[GRAPHIC] [TIFF OMITTED] T5049.115

[GRAPHIC] [TIFF OMITTED] T5049.116

[GRAPHIC] [TIFF OMITTED] T5049.117

[GRAPHIC] [TIFF OMITTED] T5049.048

[GRAPHIC] [TIFF OMITTED] T5049.118

[GRAPHIC] [TIFF OMITTED] T5049.049

[GRAPHIC] [TIFF OMITTED] T5049.050

[GRAPHIC] [TIFF OMITTED] T5049.051

[GRAPHIC] [TIFF OMITTED] T5049.119

[GRAPHIC] [TIFF OMITTED] T5049.120

[GRAPHIC] [TIFF OMITTED] T5049.121

[GRAPHIC] [TIFF OMITTED] T5049.122

[GRAPHIC] [TIFF OMITTED] T5049.123

[GRAPHIC] [TIFF OMITTED] T5049.124

[GRAPHIC] [TIFF OMITTED] T5049.125

[GRAPHIC] [TIFF OMITTED] T5049.126

[GRAPHIC] [TIFF OMITTED] T5049.127

[GRAPHIC] [TIFF OMITTED] T5049.128

[GRAPHIC] [TIFF OMITTED] T5049.129

[GRAPHIC] [TIFF OMITTED] T5049.052

[GRAPHIC] [TIFF OMITTED] T5049.053

[GRAPHIC] [TIFF OMITTED] T5049.054

[GRAPHIC] [TIFF OMITTED] T5049.130

[GRAPHIC] [TIFF OMITTED] T5049.131

[GRAPHIC] [TIFF OMITTED] T5049.055

[GRAPHIC] [TIFF OMITTED] T5049.056

[GRAPHIC] [TIFF OMITTED] T5049.057

[GRAPHIC] [TIFF OMITTED] T5049.058

[GRAPHIC] [TIFF OMITTED] T5049.059

[GRAPHIC] [TIFF OMITTED] T5049.060

[GRAPHIC] [TIFF OMITTED] T5049.061

[GRAPHIC] [TIFF OMITTED] T5049.062

[GRAPHIC] [TIFF OMITTED] T5049.063

[GRAPHIC] [TIFF OMITTED] T5049.064

[GRAPHIC] [TIFF OMITTED] T5049.132

[GRAPHIC] [TIFF OMITTED] T5049.133

[GRAPHIC] [TIFF OMITTED] T5049.134

[GRAPHIC] [TIFF OMITTED] T5049.135

[GRAPHIC] [TIFF OMITTED] T5049.136

[GRAPHIC] [TIFF OMITTED] T5049.065

[GRAPHIC] [TIFF OMITTED] T5049.066

[GRAPHIC] [TIFF OMITTED] T5049.067

[GRAPHIC] [TIFF OMITTED] T5049.068

[GRAPHIC] [TIFF OMITTED] T5049.069

[GRAPHIC] [TIFF OMITTED] T5049.137

[GRAPHIC] [TIFF OMITTED] T5049.070

[GRAPHIC] [TIFF OMITTED] T5049.138

[GRAPHIC] [TIFF OMITTED] T5049.139

[GRAPHIC] [TIFF OMITTED] T5049.140

[GRAPHIC] [TIFF OMITTED] T5049.071

[GRAPHIC] [TIFF OMITTED] T5049.141

[GRAPHIC] [TIFF OMITTED] T5049.142

[GRAPHIC] [TIFF OMITTED] T5049.143

[GRAPHIC] [TIFF OMITTED] T5049.144

[GRAPHIC] [TIFF OMITTED] T5049.145

[GRAPHIC] [TIFF OMITTED] T5049.146

[GRAPHIC] [TIFF OMITTED] T5049.147

[GRAPHIC] [TIFF OMITTED] T5049.072

[GRAPHIC] [TIFF OMITTED] T5049.073

[GRAPHIC] [TIFF OMITTED] T5049.074

[GRAPHIC] [TIFF OMITTED] T5049.075

[GRAPHIC] [TIFF OMITTED] T5049.148

[GRAPHIC] [TIFF OMITTED] T5049.149

[GRAPHIC] [TIFF OMITTED] T5049.150

[GRAPHIC] [TIFF OMITTED] T5049.076

[GRAPHIC] [TIFF OMITTED] T5049.077

[GRAPHIC] [TIFF OMITTED] T5049.078

[GRAPHIC] [TIFF OMITTED] T5049.079

[GRAPHIC] [TIFF OMITTED] T5049.080

[GRAPHIC] [TIFF OMITTED] T5049.081

[GRAPHIC] [TIFF OMITTED] T5049.082

[GRAPHIC] [TIFF OMITTED] T5049.083

[GRAPHIC] [TIFF OMITTED] T5049.084

[GRAPHIC] [TIFF OMITTED] T5049.151

[GRAPHIC] [TIFF OMITTED] T5049.152

[GRAPHIC] [TIFF OMITTED] T5049.153

[GRAPHIC] [TIFF OMITTED] T5049.154

[GRAPHIC] [TIFF OMITTED] T5049.085

[GRAPHIC] [TIFF OMITTED] T5049.086

[GRAPHIC] [TIFF OMITTED] T5049.155

[GRAPHIC] [TIFF OMITTED] T5049.156

[GRAPHIC] [TIFF OMITTED] T5049.157

Appendix II:

----------

Additional Material for the Record

Submitted Materials by Ranking Member Johnson

Submitted Statement by Representative Jerry Costello
Mr. Chairman, thank you for holding today's hearing on the
Department of Energy's (DOE's) Fiscal Year 2012 (FY12) research and
development budget request.
The DOE's FY12 budget requests $29.5 billion, an 11.8% increase
over the enacted Fiscal Year 2010 levels. One-third of this funding is
requested for R&D programs across the department to develop,
demonstrate, and deploy new energy technology. While I have concerns
about some proposed cuts, overall this budget will keep the U.S. on a
path to achieving energy independence and maintain our leadership in
energy innovation.
First, I am pleased to see DOE's expansion of the Energy Innovation
Hubs to pursue energy research from its earliest stages to commercial
deployment. The FY12 budget would add a new Batteries and Energy
Storage Hub, which will build on the remarkable energy storage work
done by Argonne National Laboratory in Illinois. The development of new
energy storage is critical to improving the efficiency of our vehicle
fleet, buildings, and national grid. This new investment, combined with
a substantial increase in funding for the Energy Storage subprogram,
will ensure we continue to lead the world in the development of energy
storage technology.
Second, DOE's budget provides nearly $1 billion in new funding for
the Office of Energy Efficiency and Renewable Energy. In particular,
the FY12 budget provides $340 million, a 56% increase, for the ongoing
development and deployment of cost effective and high-performance
biomass fuels, including $150 million for new cellulosic ethanol
demonstration projects. This funding reflects a shift in DOE's focus
from integrated biorefinery projects and feedstock production trials to
larger-scale demonstration projects and commercial deployment.
Improving and expanding the use of biofuels will reduce our dependence
on foreign oil, lower our emissions, and create millions of American
jobs. I am interested in hearing from Dr. Chu what impact these changes
in funding will have on the use of ethanol, biodiesel, and other
biomass fuels.
Finally, I have concerns about the administration's 31 percent
decrease in funding for fossil energy R&D. I am a strong supporter of
investing in renewable fuels, but it is imperative that we develop a
balanced energy policy that continues to invest in the clean use of
coal. In 2010, President Obama announced his strong support for clean
coal technology and committed to establishing at least 10 clean coal
demonstration projects by 2016. Further, in August 2010, a multi-agency
task force released a report indicating there were no insurmountable
roadblocks to deploying carbon capture and storage (CCS) technology on
a commercial scale. Despite this support for moving clean coal forward,
the FY12 budget cuts funding $100 million from coal R&D and eliminates
three ongoing clean coal research programs at DOE.
Coal is and will remain our major energy source for years to come,
and we must demonstrate we can cleanly use it. Investing in clean coal
now is imperative to continue providing dependable, affordable, and
efficient energy while we bring new sources of energy online.
I welcome Secretary Chu, and I look forward to his testimony. Thank
you again, Mr. Chairman.