[House Hearing, 114 Congress]
[From the U.S. Government Publishing Office]





            THE FISCAL YEAR 2016 DEPARTMENT OF ENERGY BUDGET

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

                                HEARING

                               BEFORE THE

                    SUBCOMMITTEE ON ENERGY AND POWER

                                 OF THE

                    COMMITTEE ON ENERGY AND COMMERCE
                        HOUSE OF REPRESENTATIVES

                    ONE HUNDRED FOURTEENTH CONGRESS

                             FIRST SESSION

                               __________

                           FEBRUARY 11, 2015

                               __________

                           Serial No. 114-10






[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]








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                    COMMITTEE ON ENERGY AND COMMERCE

                          FRED UPTON, Michigan
                                 Chairman
JOE BARTON, Texas                    FRANK PALLONE, Jr., New Jersey
  Chairman Emeritus                    Ranking Member
ED WHITFIELD, Kentucky               BOBBY L. RUSH, Illinois
JOHN SHIMKUS, Illinois               ANNA G. ESHOO, California
JOSEPH R. PITTS, Pennsylvania        ELIOT L. ENGEL, New York
GREG WALDEN, Oregon                  GENE GREEN, Texas
TIM MURPHY, Pennsylvania             DIANA DeGETTE, Colorado
MICHAEL C. BURGESS, Texas            LOIS CAPPS, California
MARSHA BLACKBURN, Tennessee          MICHAEL F. DOYLE, Pennsylvania
  Vice Chairman                      JANICE D. SCHAKOWSKY, Illinois
STEVE SCALISE, Louisiana             G.K. BUTTERFIELD, North Carolina
ROBERT E. LATTA, Ohio                DORIS O. MATSUI, California
CATHY McMORRIS RODGERS, Washington   KATHY CASTOR, Florida
GREGG HARPER, Mississippi            JOHN P. SARBANES, Maryland
LEONARD LANCE, New Jersey            JERRY McNERNEY, California
BRETT GUTHRIE, Kentucky              PETER WELCH, Vermont
PETE OLSON, Texas                    BEN RAY LUJAN, New Mexico
DAVID B. McKINLEY, West Virginia     PAUL TONKO, New York
MIKE POMPEO, Kansas                  JOHN A. YARMUTH, Kentucky
ADAM KINZINGER, Illinois             YVETTE D. CLARKE, New York
H. MORGAN GRIFFITH, Virginia         DAVID LOEBSACK, Iowa
GUS M. BILIRAKIS, Florida            KURT SCHRADER, Oregon
BILL JOHNSON, Ohio                   JOSEPH P. KENNEDY, III, 
BILLY LONG, Missouri                     Massachusetts
RENEE L. ELLMERS, North Carolina     TONY CARDENAS, California
LARRY BUCSHON, Indiana
BILL FLORES, Texas
SUSAN W. BROOKS, Indiana
MARKWAYNE MULLIN, Oklahoma
RICHARD HUDSON, North Carolina
CHRIS COLLINS, New York
KEVIN CRAMER, North Dakota
                    Subcommittee on Energy and Power

                         ED WHITFIELD, Kentucky
                                 Chairman
PETE OLSON, Texas                    BOBBY L. RUSH, Illinois
  Vice Chairman                        Ranking Member
JOHN SHIMKUS, Illinois               JERRY McNERNEY, California
JOSEPH R. PITTS, Pennsylvania        PAUL TONKO, New York
ROBERT E. LATTA, Ohio                ELIOT L. ENGEL, New York
GREGG HARPER, Vice Chairman          GENE GREEN, Texas
DAVID B. McKINLEY, West Virginia     LOIS CAPPS, California
MIKE POMPEO, Kansas                  MICHAEL F. DOYLE, Pennsylvania
ADAM KINZINGER, Illinois             KATHY CASTOR, Florida
H. MORGAN GRIFFITH, Virginia         JOHN P. SARBANES, Maryland
BILL JOHNSON, Ohio                   PETER WELCH, Vermont
BILLY LONG, Missouri                 JOHN A. YARMUTH, Kentucky
RENEE L. ELLMERS, North Carolina     DAVID LOEBSACK, Iowa
BILL FLORES, Texas                   FRANK PALLONE, Jr., New Jersey (ex 
MARKWAYNE MULLIN, Oklahoma               officio)
RICHARD HUDSON, North Carolina
JOE BARTON, Texas
FRED UPTON, Michigan (ex officio)














  
                             C O N T E N T S

                              ----------                              
                                                                   Page
Hon. Ed Whitfield, a Representative in Congress from the 
  Commonwealth of Kentucky, opening statement....................     1
    Prepared statement...........................................     4
Hon. Bobby L. Rush, a Representative in Congress from the State 
  of Illinois, opening statement.................................     5
Hon. Fred Upton, a Representative in Congress from the State of 
  Michigan, opening statement....................................     6
    Prepared statement...........................................     7
Hon. Frank Pallone, Jr., a Representative in Congress from the 
  State of New Jersey, opening statement.........................     8

                               Witnesses

Ernest J. Moniz, Secretary, U.S. Department of Energy............     9
    Prepared statement...........................................    11
    Answers to submitted questions \1\...........................    69

                           Submitted Material

Chart entitled, ``DOE Budget for Applied Energy and ARPA-E,'' 
  submitted by Mr. Whitfield.....................................     3

----------
\1\ Available at:http://docs.house.gov/meetings/if/if03/20150211/
  102942/hhrg-114-if03-wstate-monize-20150211-sd543.pdf.









 
            THE FISCAL YEAR 2016 DEPARTMENT OF ENERGY BUDGET

                              ----------                              


                      WEDNESDAY, FEBRUARY 11, 2015

                  House of Representatives,
                  Subcommittee on Energy and Power,
                          Committee on Energy and Commerce,
                                                    Washington, DC.
    The subcommittee met, pursuant to call, at 1:00 p.m., in 
room 2322, Rayburn House Office Building, Hon. Ed Whitfield 
(chairman of the subcommittee) presiding.
    Present: Representatives Whitfield, Olson, Barton, Shimkus, 
Latta, McKinley, Pompeo, Kinzinger, Griffith, Hohnson, Long, 
Ellmers, Flores, Mullin, Hudson, Upton (ex officio), Rush, 
McNerney, Tonko, Engel, Capps, Doyle, Castor, Sarbanes, 
Yarmuth, Loebsack, and Pallone (ex officio).
    Staff Present: Nick Abraham, Legislative Clerk; Gary 
Andres, Staff Director; Charlotte Baker, Deputy Communications 
Director; Sean Bonyun, Communications Director; Leighton Brown, 
Press Assistant; Allison Busbee, Policy Coordinator, Energy & 
Power; Patrick Currier, Counsel, Energy & Power; Tom 
Hassenboehler, Chief Counsel, Energy & Power; Peter Kielty, 
Deputy General Counsel; David McCarthy, Chief Counsel, 
Environment/Economy; Brandon Mooney, Professional Staff Member, 
E & P; Mary Neumayr, Senior Energy Counsel; John Ohly, 
Professional Staff, O & I; Chris Sarley, Policy Coordinator, 
Environment & Economy; Peter Spencer, Professional Staff 
Member, Oversight; Jeff Carroll, Minority Staff Director; Rick 
Kessler, Minority Senior Advisor and Staff Director, Energy and 
Environment; and Ryan Schmit, Minority EPA Detailee.

  OPENING STATEMENT OF HON. ED WHITFIELD, A REPRESENTATIVE IN 
           CONGRESS FROM THE COMMONWEALTH OF KENTUCKY

    Mr. Whitfield. I would like to call the meeting to order.
    Today's hearing is the review of the fiscal year 2016 
Department of Energy budget, and I would like to recognize 
myself 5 minutes for an opening statement.
    Today we are going to examine the Department of Energy's 
proposed budget for fiscal year 2016. I am delighted that 
Secretary Moniz is here with us today. I want to say to him 
that I have great respect and admiration for him. I must also 
say that I don't have a lot of respect and admiration for the 
administration's energy policies.
    But this proposed budget for 2016 is $29.9 billion, a 9 
percent increase over last year's appropriation. Interestingly 
enough, many people are making the argument that while DOE's 
budget request is growing, the Agency's role in setting the 
energy policy for the United States seems to be diminishing 
because EPA, through its regulations, seems to be dictating the 
energy policy more and more for America.
    Now, the potential damage goes well beyond the thousands of 
coal miners and tens of thousands of coal-fired power plant 
employees who have lost their jobs under this administration. 
Electric bills are on the rise, and reliability concerns are an 
increasing focus of a lot of different entities. And these are 
serious concerns. As a direct result of EPA's proposed 
regulations on new power plants, you cannot build a state-of-
the-art coal-fired plant today in America, the type that is 
being built today in Japan, in Germany, in China, in India, and 
in many other countries around the world.
    Now, I understand that low natural gas prices play a part, 
but EPA has effectively put a moratorium on construction by 
requiring that new plants use carbon capture technology that 
has not been demonstrated as commercially viable for power 
generation in America. And we continue to see that the 
prospects for CCS power plant commercialization are slipping 
years into the future, according to the Department of Energy 
itself.
    So at a time when EPA is ratcheting up the regulatory 
demands on coal-fired electric generation, DOE is reducing the 
fossil energy research and development program that could help 
the sector find ways to comply.
    Just last week the agency stopped the FutureGen program 
even though EPA's regulatory agenda continues to require that 
new power plants install carbon capture and storage.
    Now, nothing speaks better about a budget than the budget 
itself, and this slide illustrates precisely what I would like 
it to say. This budget shows on the far left, that is the DOE 
budget for renewables and energy efficiency; and the rest of 
it, as you can see, all of them combined does not equal that.
    [Slide shown.]
    [GRAPHIC] [TIFF OMITTED] T5232.022
    
    Now the President of the United States goes around the 
country and the world talking about an all-of-the-above energy 
policy, but when you look at the budget of his Department of 
Energy, you see that his policy is about renewables and nothing 
else primarily. So that is a real disappointment.
    I might also just mention that I don't think the 
President's $38 million reduction in his request for funding at 
the Paducah Gas' diffusion site is a good sign. The DOE has now 
awarded the deactivation contract at this site. There is a 
mechanism to begin significant work, but consistent and 
adequate funding to begin cleanup is necessary.
    Overall, my issues with the proposed budget reflect my 
issues with the direction that this administration has taken on 
the energy policy, which is being climate-driven. And I think 
the budget, this slide, certainly reflects that.
    And with that, I would yield back the balance of my time.
    And I would like to recognize the gentleman from Illinois 
for his opening statement.
    [The prepared statement of Mr. Whitfield follows:]

                Prepared statement of Hon. Ed Whitfield

    This afternoon we will examine the Department of Energy's 
proposed budget for fiscal year 2016. I welcome Secretary Moniz 
and look forward to hearing your thoughts on this proposed 
budget as well as your answers to our questions.
    DOE's proposed budget for 2016 is $29.9 billion dollars, a 
9 percent increase over last year's appropriation. DOE's budget 
request is growing, yet the agency's role in setting the 
nation's energy policy is shrinking. DOE has relinquished the 
lead to EPA, and much of DOE's actions amount to little more 
than a support role, in particular providing justification for 
EPA's efforts to handicap coal and other fossil fuels in the 
name of addressing climate change.
    The potential damage goes well beyond the thousands of coal 
miners and tens of thousands of coal-fired power plant 
employees who have lost their jobs under the Obama 
administration. Electric bills are on the rise, and reliability 
concerns are real and growing. Secretary Moniz, you will have 
the distinction of seeing more coal-fired generation shut down 
during your tenure than any other Secretary of Energy, and by a 
wide margin. While the President and the environmentalists may 
applaud you for that, I can assure you the citizens of Kentucky 
and other coal states would not.
    As a direct result of EPA's proposed regulations on new 
power plants, you cannot build a state-of-the-art coal fired 
power plant today in the United States--the type being built 
today in Japan, in Germany, in China, in India and other parts 
of the world. Low natural gas prices play a part, but EPA has 
effectively put a moratorium on construction by requiring that 
new plants use Carbon Capture technology that has not been 
demonstrated as commercially viable for power generation in 
this country. And, we continue to see that the prospects for 
CCS power plant commercialization are slipping years into the 
future, according to your agency.
    So, at a time when EPA is ratcheting up the regulatory 
demands on coal-fired electric generation, DOE is cutting back 
on the Fossil Energy Research and Development program that 
could help this sector find ways to comply. And, just last 
week, the agency put an end to the FutureGen program even 
though EPA's regulatory agenda continues to require that new 
power plants install carbon capture and storage.
    I believe that a good budget reflects reality, and that a 
bad one reflects wishful thinking. I'd like to point to a slide 
that shows the DOE budget for Applied Energy and ARPA-E. As in 
previous years, this DOE budget lavishes large sums on wind and 
solar energy and other renewables. The requested budget for the 
Office of Energy Efficiency and Renewable Energy (EERE) is more 
than all of the other Applied Energy Office and ARPA-E budgets 
combined. But despite all this funding, non-hydro renewables 
remain less than 10 percent of our nation's electricity supply, 
and they create serious cost and reliability concerns that are 
likely to preclude a significant increase. Wind and solar will 
always remain an intermittent and minor contributor relative to 
base load sources such as coal, nuclear, and natural gas. 
Granted, the Office of Energy Efficiency & Renewable Energy 
does some useful work that should continue, but its $2.7 
billion dollar budget is well out of proportion to the 
potential benefits and the realities of our nation's energy 
needs. I would prefer that proposed spending levels better 
reflected the reality of America's current and future energy 
mix.
    I might also add that I am extremely disappointed with the 
President's $38 Million reduction in request for funding at the 
Paducah Gaseous Diffusion site in Paducah, Kentucky. Since the 
DOE has now awarded the deactivation contract at the site, 
there is a mechanism to begin significant work, but consistent 
and adequate funding to begin cleanup is necessary. Now is not 
the time to slow down, but to push the project forward. I look 
forward to addressing this issue with you.
    I remain a strong critic of EPA's proposed rules for new 
and existing coal-fired power plants and I will have many 
questions about these and other regulations at EPA's upcoming 
budget hearing. But as long as these measures remain part of 
the administration's energy agenda, I believe that DOE research 
efforts should be directed towards assisting industry in 
meeting these requirements.
    Overall, my issues with the proposed budget reflect my 
issues with the direction the administration has taken on its 
climate driven energy policy.

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

    Mr. Rush. I want to thank you, Mr. Chairman.
    And I want to welcome you, Secretary Moniz. I also want to 
commend you for the outstanding work that you are doing across 
the board, but I want to specifically commend you for the 
legacy that you are working to establish at the Department of 
Energy in regards to transitioning the agency to be more 
attuned to the needs of all segments of the diverse American 
population.
    Through the Minorities in Energy Initiative, which 
celebrated its 1-year anniversary back in November of last 
year, the more recent Job Strategy Council, which you 
established this past January, I am extremely encouraged by 
these policies which seek to position DOE as a proactive, 
forward-thinking agency that can be part of the solution rather 
than part of the problem.
    Your staff, Mr. Secretary, recently got back to my office 
with constructive feedback on the workforce development bill 
that I introduced in the last Congress, and I was very 
encouraged to see that many of the policies and programs 
outlined in the bill align seamlessly with many of the 
proposals that you have initiated within the Agency.
    Of course, as we both understand, the steps that have been 
taken are only the beginning stages of a longer process that 
would take time, effort, and resources to fully implement and 
become effective. The problem of underserved communities being 
historically left out of the energy sector both in the private 
and public realm did not happen overnight, and the policies 
needed to address these issues will not take hold overnight.
    The good news, Mr. Secretary, is that today there is a 
focus on trying to proactively promote diversity and inclusion 
within all sections of the industry, and there is widespread 
support for policies that can help accomplish this goal. On 
this subcommittee alone, members on both sides of the aisle 
have expressed interest in moving forward with legislation 
designed to target women, minorities, veterans, and other 
underrepresented groups, and to help train and prepare them for 
the energy and manufacturing jobs of the present and of the 
future.
    Industry groups, labor unions, community colleges, and 
universities, all understand that it is a win-win situation to 
help prepare a more than willing labor force for the well-
paying jobs and careers that can be found in all sectors of the 
energy industry.
    In America's new energy renaissance, where a skilled 
workforce is mandatory for building new infrastructure, to 
installing wind turbines or solar panels, to designing the 
latest technological advances in drilling, the possibilities 
for the American worker are becoming more and more abundant. 
And ensuring that all segments of the American population are 
given access and equal opportunity to participate in this 
American energy renaissance will only serve as a benefit to 
industry, to communities, and to the American economy as a 
whole.
    So, Mr. Secretary, I say thumbs up to your agency, thumbs 
up to your plans, thumbs up to your budget. Let's get this good 
work that the American people have called us to do, let's start 
working on it immediately, if not sooner.
    Thank you, and I yield back.
    Mr. Whitfield. Thank you, Mr. Rush.
    At this time I would like to recognize the chairman of the 
full committee, Mr. Upton, for 5 minutes.

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

    Mr. Upton. Mr. Secretary, welcome back.
    I know that today's discussion is just one of the many that 
DOE is conducting as we look forward to working together to 
create a 21st Century energy policy.
    You know, the areas of disagreement between Republicans and 
this administration often get the most attention. But while 
those differences remain, I am one who always looks for areas 
of agreement, areas of common ground on an energy policy that 
can benefit all Americans. We have seen a tremendous increase 
in oil and natural gas production here in the U.S. And across 
North America. We are already seeing the benefits of abundant 
and affordable energy, whether it be at the gas pump, our power 
bills, and with the creation of new jobs. But for more 
Americans to see even better benefits, we need to move beyond 
decades-old energy scarcity policies. We need to maximize the 
benefit of North American energy, and at this committee we call 
it the building of the architecture of abundance.
    The first step is to upgrade and modernize our energy 
infrastructure. The new energy coming on line is of no use if 
we can't deliver it to consumers and businesses. We need a 
modern and more resilient infrastructure to safely and 
responsibly maximize our growing oil and gas output.
    Our bipartisan pipeline safety legislation was an important 
milestone. Yes, it was. But there is more work to do. We also 
need to ensure that our electric grid can meet the challenges 
of the future, from everything from advanced grid technologies, 
to protecting against weather events or physical or 
cybersecurity threats.
    Our energy abundance is also proving to be a powerful jobs 
creator, not only in places like Texas and North Dakota, where 
production is booming, but also in Michigan and other 
manufacturing States, where low energy prices are fueling 
growth and attracting new jobs.
    According to one study, modernizing North America's energy 
infrastructure could, in fact, support an average of 432,000 
jobs per year through 2035. Despite the recent decline in oil 
prices, there continues to be many job opportunities for 
trained workers; but the key word here is trained.
    One industry study estimates that there will be 600,000 
career opportunities for men and women and minorities in energy 
in the years ahead. We need to ensure that necessary education 
and job training is available for all Americans.
    Our energy potential makes us more secure here at home and 
more powerful abroad. We can diminish the political influence 
of other energy exporters like Russia and Iran, and help many 
of our allies, who would much rather buy their energy from the 
U.S. But it will only happen if energy security and 
geopolitical benefits become a part of our policy 
decisionmaking.
    Dr. Moniz, we have a wonderful opportunity of working 
together to fulfill our tremendous energy potential.
    And I yield back.
    Mr. Whitfield. The gentleman yields back.
    [The prepared statement of Mr. Upton follows:]

                 Prepared statement of Hon. Fred Upton

    Secretary Moniz, welcome back to the committee. I hope that 
today's discussion is just one of many with DOE on creating a 
21st century energy policy. The areas of disagreement between 
Republicans and the Obama administration often get most of the 
attention. But while our differences remain, I'm one who will 
always look for areas of agreement--areas of common ground on 
an energy policy that can benefit all Americans.
    We have seen a tremendous increase in oil and natural gas 
production here in the U.S. and across North America. We are 
already seeing the benefits of abundant and affordable energy--
at the gas pump, in our power bills, and with the creation of 
new jobs.
    But for more Americans to see even more benefits, we need 
to move beyond decades-old energy scarcity policies. We need to 
maximize the benefits of North American energy. At the 
committee, we call this building the Architecture of Abundance.
    The first step is to upgrade and modernize our energy 
infrastructure. The new energy coming online is of no use if we 
can't deliver it to consumers and businesses. We need a modern 
and more resilient infrastructure to safely and responsibly 
maximize our growing oil and gas output. Our bipartisan 
pipeline safety legislation was an important milestone, but 
there's more work to do. We also need to ensure that our 
electric grid can meet the challenges of the future, everything 
from advanced grid technologies to protecting against weather 
events or physical and cyber security threats.
    America's energy abundance is also proving to be a powerful 
jobs creator. Not only in places like Texas and North Dakota 
where production is booming, but also in Michigan and other 
manufacturing states where low energy prices are fueling growth 
and attracting new jobs. According to one study, modernizing 
North America's energy infrastructure could support an average 
of 432,000 jobs per year through 2035.
    Despite the recent decline in oil prices, there continues 
to be many job opportunities for trained workers. But the key 
word here is ``trained.'' One industry study estimates that 
there will be 600,000 career opportunities for women and 
minorities in energy in the years ahead. We need to ensure the 
necessary education and job training is available to all 
Americans.
    Our energy potential makes us more secure at home and more 
powerful abroad. We can diminish the political influence of 
other energy exporters like Russia and Iran, and help many of 
our allies who would much rather buy their energy from the 
United States. But it will only happen if energy security and 
geopolitical benefits become a part of our policy decision-
making.
    Let's not lose sight of the opportunity to turn America 
into an energy superpower and the bipartisan efforts that will 
help us get there. Dr. Moniz, we have a unique opportunity to 
work together as we look to fulfill our tremendous energy 
potential.

    Mr. Whitfield. At this time I would like to recognize the 
gentleman from New Jersey, Mr. Pallone, the ranking member, for 
5 minutes.

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

    Mr. Pallone. Thank you, Chairman Whitfield and Ranking 
Member Rush.
    I just want to welcome Secretary Moniz back to the 
committee. This is not the easiest time to be the Nation's top 
energy official, but I would venture to say that you are 
proving yourself to be one of the better secretaries we have 
seen.
    The President's fiscal year 2016 budget would fund the 
Department of Energy at $29.9 billion, an increase of $2.5 
billion, or up 9.2 percent from fiscal year 2015 level. And the 
budget would increase funding for important national 
priorities, including energy efficiency and renewable energy. 
Additional policy and funding priorities which are designed to 
improve electric grid reliability, reduce methane pollution, 
and enhance U.S. economic and energy security include energy 
infrastructure, technology and research to accelerate energy 
technologies through the development of transformational 
technologies.
    The President's budget would also fund cleaner fossil fuels 
as well as post- and pre-combustion carbon capture and 
compression technologies. And very importantly, the budget 
would adequately fund the Department's critical defense-related 
activities and add $305 million to strengthen DOE's protections 
and defenses against cyber attacks and improve energy sector 
cybersecurity.
    I support this budget because it takes the next logical 
steps in an already highly coherent energy strategy, which has 
greatly diversified our energy sources, generated significant 
efficiency gains and substantial reductions in demand, and, of 
course, lowered prices at the pump to levels that American 
drivers and households have not seen in many years.
    Closer to home, I want to particularly commend the work 
done last year, and would continue under this budget, with 
regard to the Northeast Regional Refined Product Reserve. My 
district in New Jersey was one of the hardest to have been hit 
by Superstorm Sandy, and the lack of access to gasoline made a 
terrible situation even worse. The gasoline reserve will help 
ensure we are ready in the future. In my opinion, the gasoline 
reserve and the Department's efforts to address the resiliency 
and reliability of our electric grid, natural gas transmission 
and distribution systems, and other energy infrastructure, are 
critically important to not just my district, but also to the 
Nation as a whole.
    In short, this budget continues to build towards a true, 
all-of-the-above energy strategy that addresses supply, demand, 
and security. It builds on the progress made toward realizing 
the goal of creating a low-carbon, clean-energy economy that 
can be the engine of growth for decades to come, and so I 
support it enthusiastically, and I look forward to hearing more 
from the Secretary.
    I yield back, Mr. Chairman. Thank you.
    Mr. Whitfield. The gentleman yields back the balance of his 
time.
    That concludes the opening statements. And so at this time, 
Secretary Moniz, you are recognized for 5 minutes for your 
statement.
    And welcome again. We appreciate your being here.

    STATEMENT OF THE HON. ERNEST J. MONIZ, SECRETARY, U.S. 
                      DEPARTMENT OF ENERGY

    Secretary Moniz. Thank you.
    And Chairman Upton and Whitfield, and Ranking Members 
Pallone and Rush, members of the committee, I really appreciate 
the opportunity to come and discuss our budget with you, and I 
also appreciate your flexibility with regard to scheduling of 
the hearing.
    Over the last 6 years, as has already been said, the U.S. 
has become the world's number one producer of oil, liquid 
fuels, natural gas; and now, in fact, our net imports of crude 
oil end products is below 5 million barrels a day, quite a 
remarkable place to have come in this period.
    The EIA estimates that just in gasoline alone, the average 
household will be saving $750 in 2015, and there are other 
savings as well in the energy sector.
    I have submitted an extensive submission for the record, so 
I am going to be very, very brief in these remarks so that we 
can move to questions. I will just emphasize a few points. One 
is, this economic growth that we are enjoying, the energy boom 
that we are enjoying, has come even as we continue to decrease 
greenhouse gas emissions.
    Secondly, that we are committed to an all-of-the-above 
energy strategy, and we will continue to do that through a 
whole raft of lower-cost, clean energy technologies, in fossil 
energy, energy efficiency, sustainable transportation, 
renewable energy, nuclear energy, and, well, energy efficiency 
I mentioned.
    I will also add that in addition to focusing on the supply-
and-demand sides of the equation, that we are, as you know, 
very, very much focusing on energy infrastructure, and we hope 
to have our quadrennial energy review available within weeks, 
as opposed to months of time. And, of course, with your 
framework focusing on infrastructure, we look forward to that 
discussion.
    I will just end with noting, as Mr. Pallone did, that, of 
course, our role is not limited to energy. One of our very 
important roles as well is in providing a good piece of the 
backbone for the American basic research community through our 
science budget. We have requested $5.34 billion for science, 
about 5 percent over the appropriation.
    I do want to say that the science program continues to be 
very successful in, for example, completing large projects. I 
was at Brookhaven on Friday dedicating a huge light source, a 
billion dollar project, on budget and ahead of schedule. And in 
this budget request, we will build yet additional facilities.
    In addition, we have, of course, a major national defense 
responsibility, specifically nuclear security; and there again 
we have I think a strong request of $11.6 billion for the 
National Nuclear Security Administration, approximately a 10 
percent increase over the fiscal year 2015 appropriation, very 
importantly continuing a science-based approach to the 
deterrent and helping to control dangerous nuclear materials 
globally.
    Finally, environmental management, our fiscal year 2016 
budget request is for $5.8 billion, approximately equal to the 
2015 appropriation, although up significantly from our request 
of last year.
    It is worth noting, because we clearly have some very 
challenging projects there, but it is worth noting that over 
the years DOE has cleaned up over 85 percent of its sites and 
90 percent of the land area, but again significant challenges 
remain, and we think we can make good progress in fiscal year 
2016.
    I think those really are the remarks I would just make to 
open up the discussion because I think our ability to discuss 
this will be much more valuable.
    Thank you, sir.
    Mr. Whitfield. Mr. Secretary, thank you very much, and we 
appreciate that opening statement.
    [The prepared statement of Secretary Moniz follows:]
    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    
       
    Mr. Whitfield. At this time, we will begin the questions, 
and I would recognize myself for 5 minutes.
    Mr. Secretary, I am not going to talk today about proposed 
regulations on existing coal plants, but I do want to focus for 
a moment on the proposed regulations for the new coal power 
plants. And I want to do that because in December of 2010, the 
Department of Energy reported that it had seven potential CCS 
demonstration projects for coal power plants.
    Three of those plants were estimated to startup in 2014, 
three in 2015, and one in 2016. Now, I am assuming that EPA and 
DOE had a lot of conversation with each other because, as you 
know, EPA in their proposed regulations for the new plants set 
guidelines, and they focused on the Kemper plant in 
Mississippi, a proposed plant in Texas, one in California, and 
one in Canada. And the one in Texas has not began operation, 
has not even started construction, nor in California. There is 
a small one up in Canada.
    But the Kemper plant, of which these emission standards 
were developed, looking at the projected emissions from Kemper, 
this is a plant that is 2 years behind schedule, billions of 
dollars over budget. And of those projects that DOE talked 
about in 2010, three of those projects have been cancelled, 
three of the remaining four projects are now estimated to begin 
operation in 2019 or 2020, if at all. And yet EPA sets a 
standard, an emissions standard, based on projected emissions 
from some pie-in-the-sky CCS plant that is built so that you 
can use CCS for enhanced oil recovery.
    And this morning I had a meeting with the Applied Energy 
vice president at the University of Kentucky, who had just come 
back from China, where they are tearing down old coal plants 
but building new coal plants using supercritical technology 
like the one at the Turk plant over in Texarkana, Arkansas, 
which is the newest plant in the U.S., which was built before 
this proposed regulation comes out.
    So here we are in America, finding ourselves not able to 
build a new plant using the best technology because of some 
fathomable emission standard set by EPA. And I was just 
curious, has EPA, Ms. McCarthy or others, have they talked to 
you all about this and the state of commercially viable CCS 
technology?
    Secretary Moniz. Mr. Chairman, so first of all, as with 
lots of rules across the government activities, the Department 
of Energy does often provide technical support when it is not 
our responsibility to implement a certain rule or regulation.
    With regard to carbon capture and sequestration, I think it 
is very important to keep in perspective the proposed rule and 
what our demonstration projects are, because they are different 
levels of ambition in a certain sense.
    First of all, there is no question that all of the 
technologies have been demonstrated, including in an integrated 
fashion, for example in the Boundary Dam project in Canada to 
which you referred, and for both coal plants and for industrial 
plants, there are other large projects coming onboard.
    But I think a very important point is we are, as is 
appropriate for the Department of Energy, our projects are 
really trying to push the edge. So all of our projects are 
looking at 90 percent capture, et cetera. If you look at the 
rule as proposed, for example, building an ultra supercritical 
coal plant with carbon capture, with that proposed rule, would 
require only 30 percent capture. That is a very, very different 
level of challenge than the projects that we are putting 
together.
    We will be seeing--you are absolutely right that some of 
the projects are delayed. We will be seeing a good portfolio 
deployed, but you are also correct that some of the projects 
will not come online, and partly it is because of litigation 
and other issues, and the ARRA funding deadline coming in this 
year.
    But, again, the key point is if one were to go out right 
now to build an ultra supercritical plant, and they exist, and 
use conventional capture there, one is talking only about 30 
percent.
    Mr. Whitfield. Well, I might just say that the experts in 
the utility industry say that it could not be done in a 
commercially viable way where they can be competitive. And I 
think the EPA in its extreme regard of this regulation is 
really diminishing our opportunity to be competitive and have a 
reliable electricity source.
    At this time I would like to recognize----
    Secretary Moniz. I would be happy to come by and talk about 
some of this in more specific detail in terms of, especially 
the ultra supercritical route.
    Mr. Whitfield. Yes, well, we will take you up on that.
    At this time I recognize the gentleman from Illinois, Mr. 
Rush, for 5 minutes.
    Mr. Rush. I want to thank you, Mr. Chairman.
    Mr. Secretary, I have a lot of questions that I want to 
cover, but unfortunately I do not have the time to do it all 
this afternoon, so I will be reaching out to your office to 
schedule a meeting where we can more fully discuss some of the 
priorities that I have already outlined.
    That said, Mr. Secretary, my office is contacted frequently 
by business owners and entrepreneurs who would like to access 
DOE loans, grants, and/or anything technology transfers from 
the national labs. Many of these entrepreneurs tell us they 
cannot access these resources either because they don't know 
the right people, don't have the right connections, they don't 
fully understand the process, or in some cases they might just 
be intimidated by the very same process.
    Mr. Secretary, in addition to helping women, minorities, 
veterans, and other underrepresented groups access employment 
in the private sector through outreach and skills training, I 
would also like to work with you to establish outreach policies 
to educate the public on accessing DOE loans, grants, and 
technological transfers.
    It is important that we demystify these processes so that 
all Americans can benefit from these extraordinary resources 
that DOE possesses. Do you agree, and do you have any 
preliminary thoughts on how we might educate the public to make 
these resources, these loans, grants, transfers, more 
accessible?
    Secretary Moniz. Thank you, Mr. Rush.
    And thank you again for your support of the Minorities in 
Energy program, including being there at the beginning and the 
1-year anniversary.
    In terms of the access to the labs and the transparency, 
you know, that is a very important issue. We are working on 
that. Actually, we can provide you some background material, 
for example, on some of the Web sites that we have created, for 
example, looking at financing opportunities for business. But 
we have more to go, a longer way to go.
    Just today, literally this morning, we were able to 
announce a new group that we are putting together, a new 
office. It is called the Office of Technology Transitions. And 
that office's role is precisely to address the transparency and 
access to technologies that are in our laboratories that we 
want to get out as well, and have a larger customer base for it 
if you like.
    Importantly, and I do want to note this very clearly, in 
the 2005 Energy Policy Act, the Congress authorized a 0.9 
percent of applied energy R&D fund for commercialization. Up to 
now, that has been satisfied by the existing cost-shared CRADA 
agreements. Today I announced that we are going to move forward 
and actually create that as a separate fund, a technology 
commercialization fund, that will be run out of this Office of 
Technology Transitions by our technology transfer coordinator. 
It will seek at least 50 percent matching funds--it can always 
be waived in special circumstances--but that would be the norm, 
and making that system transparent. Allowing access to medium 
and small business as well as large businesses will be part of 
the goal.
    Mr. Rush. Mr. Secretary, you have done such a remarkable 
job during your tenure in establishing the Minorities in Energy 
Initiative and the Jobs Strategy Council. Do you think that we 
should look at some of your best practices and begin to codify 
some of those in law? That is the first question.
    And the second question, if you have an opportunity to 
answer this, is do you think that this $29.9 billion budget 
that you are seeking, is that enough to do the work that you 
are required to do in this particular area?
    Secretary Moniz. Well, I think the budget request is a very 
good one, and one in which we can move forward in the areas 
that you have said, but it will take, frankly, continued 
commitment at the top of the Department, and I don't mean only 
me. I mean a lot of other of the leadership of the Department.
    And as far as best practices go, there are several to draw 
upon. One, we mentioned earlier the tremendous development in 
the oil and gas sector, for example, in the United States. And 
here I will say working together with API, the Petroleum 
Institute, it has been terrific in that we have had, I think, 
now about a half-dozen workshops jointly focusing on attracting 
minorities into the many job opportunities in that area. That 
is one example.
    Another example, a person we brought on board last June 
named Dave Foster is really the point person on the whole jobs 
strategy. And so combining Minorities in Energy, women in clean 
energy, job strategy, the situation in our energy world right 
now, the very fortunate one, I hope we can make some real 
progress in the next 2 years. We need the talent.
    Mr. Whitfield. The gentleman's time is expired.
    At this time I recognize the gentleman from Michigan, Mr. 
Upton, for 5 minutes.
    Mr. Upton. Thank you again, Mr. Chairman.
    On Monday, as you know, Mr. Secretary, this committee 
released a legislative framework for compiling a solutions-
based energy package in this Congress. And it consisted really 
of four areas: Modernizing infrastructure, 21st Century energy 
workforce, energy diplomacy, and efficiency and accountability. 
And we do want to make sure that we coordinate this closely 
with our Senate counterparts, and also working with the 
Department of Energy. And we welcome the constructive 
engagement in those areas, and appreciate the discussions we 
have had thus far.
    Also, know that the Department is preparing for the release 
of the first quadrennial energy review, QER, focusing on energy 
transmission, storage, and distribution. And we further 
understand that the effort will include some legislative 
proposals to Congress, which should complement the effort 
underway before this committee. And while we have not yet 
received your recommendations, we look forward to working with 
you, reviewing those in a timely manner to find agreement of 
common interest. I appreciate that willingness.
    Recognizing that the legislative process is about give and 
take, we hope that you will be open to our ideas as we seek 
solutions to permitting challenges and infrastructure 
bottlenecks to resolve those. We also think that it is 
important to think about ways how we can use our energy 
resources, and the Department's role in securing resource 
development as a source for global good.
    And I know that you have been personally involved for many, 
many months, in discussions with our allies in Eastern Europe 
and around the world, our partners in Canada and Mexico, and I 
wonder if you might expound on those in the remaining time that 
I have? Some of those----
    Secretary Moniz. Certainly. Thank you.
    And first of all, let me again assure you publicly of what 
we have discussed privately, that we look forward to working on 
the framework that you have put forward. All of those issues 
are very dear to what we are doing, especially the 
accountability of Congress that was in that fourth part.
    Mr. Upton. You don't have to worry about us.
    Secretary Moniz. With regard to the international events, I 
will mention two of those, yes. One is Ukraine, you effectively 
alluded to, and our people, led by our emergency response 
people, but bringing in others, Red Cross, FEMA; Canadians have 
been very helpful, we have sent teams over to Ukraine now three 
times. Our teams, I want to emphasize, did not write the Energy 
Winter Contingency Plan for Ukrainians, but led them through 
the process of how to do that; and they wrote an energy 
contingency plan.
    It also identified correctly the problem that there was 
going to be with coal, for example, this winter, and some other 
problems. So that has been very, very well appreciated. The 
Ukrainian Government is asking us now to do more, which we had 
a fact-finding group go there a week before last. They would 
like training, they would like to know how to manage emergency 
response. They want to know about energy modelling. These are 
all, I think, very helpful tools for them. But that is where I 
think we will need some discussion with the Congress and other 
parts of the administration as to how we can respond to that.
    With regard to North America, in December we had a very, 
very, very positive trilateral energy ministerial with Canada 
and Mexico. One result is we agreed that we should do it every 
year at least, which is progress. But, for example, we signed 
an MOU that we have already launched the work on through our 
Energy Information Administration on data, energy data 
integration. We really don't have a lot of data integration 
across the borders, or in some cases the same data. It seems to 
be different. So that is just one example.
    I will mention a very interesting example. In the 
trilateral, our Mexican colleagues, Minister Joaquin Coldwell 
in particular, gave us an extensive briefing on energy reform 
in Mexico. And while there has been a lot of focus on the 
hydrocarbon part, they want to emphasize the reform on the 
electricity sector is equally ambitious, and will open up many 
more collaborative possibilities. In fact, they said more 
electricity integration is something that Mexico would like to 
work with us very, very closely.
    So I think those are two areas of some of our international 
work, different in character, but both very important.
    Mr. Upton. Great. Thank you.
    Yield back.
    Mr. Whitfield. The gentleman yields back.
    At this time I recognize the gentleman from California, Mr. 
McNerney, for 5 minutes.
    Mr. McNerney. Thank you, Mr. Chairman.
    I want to thank you, Mr. Secretary, for coming in. It is 
always a pleasure to have you testify in front of the committee 
here.
    Secretary Moniz. Thank you.
    Mr. McNerney. As I look over the budget numbers, I am very 
happy to see a large increase in the electricity delivery and 
energy reliability categories. One of my colleagues, Ms. 
Ellmers, and I are working together on grid technology. And I 
just want to ask what the Department can do to translate all 
that it has learned about smart grid investment grants and 
smart grid demonstration projects into actionable information 
for electricity providers.
    Secretary Moniz. Thank you.
    I can assure you also the quadrennial energy review coming 
out will have a major focus, of course, on the electricity 
grid, as does our budget. We have a $356 million proposal for 
the whole-grid modernization approach, so that will have many, 
many aspects.
    Part of it will be developing more of the essential 
technologies, like the high-power electronics, wide-band gap 
semi-conductors, et cetera, et cetera. Part of it will be a 
system analysis. Part of it will be further integration. You 
alluded to the data. So, for example, with the ARRA funding, 
one of the major programs was to really deploy well over 100 
syncrophasors to really let us know what is going on in the 
high-voltage grid. Now integrating that information into 
actionable, precautionary actions will be part of this.
    But also another part of it is--actually, we have two 
different programs, but one specifically here--we also propose 
a State planning grant program. It is about $27 million we 
propose for grants to States to plan for reliability and how 
they will be doing integration. That, of course, in turn could 
lead to subsequent proposals for actual projects to implement 
microgrids, distributed generation, other kinds of IT-based 
technologies.
    Mr. McNerney. I am looking forward to working with your 
Department on that and with my colleagues.
    Fusion, what do we have in the next budget for fusion 
energy? And you know, this is an area I think a lot of good 
future potential, but it is not in the immediate future.
    Secretary Moniz. I regret I have the same answer as last 
year, which is that I am recused from fusion. That recusal ends 
in May, so if you would like to ask me the question in June, we 
could come back. But seriously, perhaps our deputy secretary or 
our under secretary could come and visit you about that. 
Because I am recused from all decisionmaking in the fusion 
program.
    Mr. McNerney. OK. Fair enough.
    So about the smart grid technologies, what do you think are 
some of the barriers to improving our grid technology and 
reliability then, given where we are today?
    Secretary Moniz. Well, on the high voltage side, the high 
voltage grid, I think one of the issues, as I already 
described, was this issue of now being able to use the new data 
that we are getting from these new kinds of sensors. But a lot 
of the action is really going to be on the distribution side. I 
think that is where a lot of the imbedded intelligence has to 
be. That is key to starting to bring in distributed generation, 
maybe distributed storage.
    Mr. McNerney. So you think we are going to have to put 
incentives out there for the local distribution networks to 
move forward on this?
    Secretary Moniz. And so, that is a very good point. I was 
going to end with, of course, we can help on the technology 
side; but the regulatory authority for that, of course, will 
rest with the States. So that is where we need a potential 
State-Federal partnership. That is where those planning grants 
can come in, where we will give a grant to States, to the State 
Energy Offices, to see what they need to do for their smart 
grid, and then we will see if there is some possibility of our 
working with them to implement it.
    Mr. McNerney. Well, I am also happy to see energy 
efficiency and renewable energies move forward with this 
budget. Very important for our Nation's energy mix to have 
those as a significant and reliable part.
    Secretary Moniz. Thank you.
    Mr. McNerney. I just want to ask the chairman to consider 
that developing carbon sequestration technology is going to be 
beneficial to the coal industry, because as climate change 
progresses there is going to be a larger outcry to stop 
producing carbon dioxide. So this is something that is going to 
benefit the coal industry. We are not out to hurt the coal 
industry with carbon sequestration technology.
    I yield back.
    Mr. Whitfield. Thank you.
    The gentleman yields back.
    At this time I recognize the gentleman from Illinois, Mr. 
Shimkus, for 5 minutes.
    Mr. Shimkus. Thank you, Mr. Chairman.
    Mr. Secretary, welcome.
    Secretary Moniz. Thank you.
    Mr. Shimkus. Are these the DOE labs that have high-level 
nuclear waste: Oak Ridge, Savannah River, Idaho Labs, and 
Hanford? Are there any more, in significant amounts?
    Secretary Moniz. In significant amounts, I think those are 
the main ones, actually and principally, Idaho, Hanford, and 
Savannah River, yes.
    Mr. Shimkus. While I was at Oak Ridge they----
    Secretary Moniz. Oak Ridge also has, yes.
    Mr. Shimkus. You have promised me numerous times that you 
as Secretary would continue to follow the law of the land. Is 
that still true?
    Secretary Moniz. It always has been true.
    Mr. Shimkus. Great. OK, good, we are on the right track 
here.
    Secretary Moniz. And the Constitution.
    Mr. Shimkus. So, in your budget justification, you have $3 
billion to move to a pilot interim storage plan. Do you agree 
that that would require a change in law? Do you not?
    Secretary Moniz. Certainly not to begin to discuss consent-
based processes, et cetera.
    Mr. Shimkus. But the Nuclear Waste Policy Act is a law 
signed----
    Secretary Moniz. So we----
    Mr. Shimkus. So the use of this money would not be with the 
intent of the law, because the law says that--it doesn't give 
the DOE the authority or the responsibility to go into a pilot 
interim storage.
    Secretary Moniz. To site such a facility would require 
further legislation.
    Mr. Shimkus. Thank you.
    Secretary Moniz. I would note, of course----
    Mr. Shimkus. Well, let me just go on.
    Secretary Moniz. OK.
    Mr. Shimkus. So you have $3 billion. You also mentioned 
$5.7 billion is outlined to maybe do this, which would require 
a change in law, but--and I made this point, I think, last 
year--the administration needs to appreciate that there is a 
change occurring in the State of Nevada.
    We recently had one Member elected who said that if it was 
proven that Yucca Mountain would be safe, then he would support 
it. That is public record. Now that the NRC has finished its 
safety and evaluation report, it said that Yucca once closed 
would be safe for a million years.
    So we are in a new world now than we were before. And just 
for public record, $3 billion or $5.7 billion could be very 
helpful in the State of Nevada transitioning to--restarting and 
opening Yucca Mountain, and also an interim, pilot interim 
storage site. So I just put that on the record.
    We have also heard that it is also required by DOE under 
the law to do the environmental impact statement. Is that not 
correct?
    Secretary Moniz. We have----
    Mr. Shimkus. The answer is yes.
    Secretary Moniz. We have responded to every request and 
order from the NRC, including providing the information that 
they needed for the----
    Mr. Shimkus. But you are not doing it?
    Secretary Moniz. We have no----
    Mr. Shimkus. It is your responsibility under the law to do 
the environmental impact statement. And what is going on now is 
the NRC is going to do it with the money remaining because of 
the failure of DOE to the final EIS.
    Secretary Moniz. No. We have responded completely to NRC's 
request.
    Mr. Shimkus. OK. We will just agree to disagree.
    As the NRC moves forward with adjudication of the license 
application, assuming that the funds are made available for the 
purpose, will you commit to following the law and defending the 
application DOE has submitted?
    Secretary Moniz. I must point out that the NRC also pointed 
out that we do not have the authorities in terms of land and 
water, for example, for Yucca Mountain. Which goes right back 
to the consent-based process. Without a consent-based process, 
we continue to think----
    Mr. Shimkus. But the question is, under the law you are 
required to defend the application. Are you willing to follow 
the law and defend the application?
    Secretary Moniz. I will have to check with the exact 
aspects of the law on that. I know the DOE was required to 
submit the application.
    Mr. Shimkus. OK. The last time we tried to visit Yucca, DOE 
gave us a lot of trouble. We are going back this year. I hope 
you will give us all opportunity and make it easy for us to get 
there and get the door open.
    Secretary Moniz. I wasn't aware of that. I apologize for 
that.
    Mr. Shimkus. No, no. OK. And then finally in your budget, 
FutureGen 2.0, obviously that money was pulled. That was the 
retrofitting of the plant in Meredosia and then the carbon 
capture sequestration issue in Morgan County, Illinois.
    I just make that point obviously because it is Illinois, 
and that is a traditional DOE project from the original 
FutureGen to now FutureGen 2.0 to pulling it away. It just adds 
to what--those of us from coal areas of the country are 
concerned that as we ramp up these environmental rules and 
regulations, we really shut down coal-fired generation, and 
that is major base load activity, which we as a country just 
can't sustain the loss of that power.
    So with that, thank you, and I look forward to working with 
you.
    Secretary Moniz. Mr. Chairman, may I just comment?
    Mr. Whitfield. Yes.
    Secretary Moniz. Make two comments if I may? I think it 
might be helpful. One is, first of all, in your opening 
statement, Mr. Shimkus, in terms of the four DOE sites, I would 
just note, of course, those do not have commercial spent fuel. 
It is high level waste.
    Mr. Shimkus. Which doesn't make it any less safe. Where is 
that supposed to go?
    Secretary Moniz. So if I may just say that there is no 
resolution yet.
    Mr. Shimkus. Well, no. There is a resolution. It is 
supposed to go to Yucca Mountain. That is where it is supposed 
to go.
    Secretary Moniz. Last fall we completed a study, and it is 
on our Web site, requested by the Blue Ribbon Commission, in 
terms of looking at the issue of whether there should be 
separate pathways. That remains a decision to be reached.
    With regard to FutureGen, let me just say that I think the 
FutureGen project, an oxycombustion plant with deep saline 
aquifer storage, is very, very important; and unfortunately, 
that funding was from the Recovery Act. The date of expending 
the funds is upon us, so the project could not meet that, and 
with regret we are in the structured closeout.
    I do want to say we will preserve the IP, and we will 
preserve the asset of the pour space that we have purchased in 
Illinois.
    Mr. Shimkus. Thank you. I will just say the Blue Ribbon 
Commission is not an elected body, and they were told 
specifically not to consider Yucca Mountain.
    Mr. Whitfield. At this time I will recognize the gentlelady 
from California, Ms. Capps, for 5 minutes.
    Mrs. Capps. Thank you, Mr. Chairman.
    It is always a pleasure, Mr. Secretary, to have you come 
before our committee.
    Secretary Moniz. Thank you.
    Mrs. Capps. And today was no different.
    And I want to start with a premise which I hope we can all 
agree upon. And that is the fact that climate change is real, 
and it is a serious threat to our Nation and to our planet. 
While we are already seeing and paying for the impacts of 
climate change, we do still have a chance to mitigate some of 
the long-term damages.
    We need to act now, however, to reduce carbon pollution and 
move toward a clean, sustainable energy future. This will 
require significant American innovation and investment. And I 
know the Department of Energy and this administration is 
committed to it. While this is not easy, I believe we have some 
of the best innovators in the world, and that we are up to that 
challenge, but they cannot do it on their own.
    The Federal Government does play an essential role in 
driving the research in development of these technologies, and 
this is something I have seen firsthand in my district.
    And I want to ask you about two of the projects that come 
out of your administration that are being developed through the 
University of California in Santa Barbara, have applications 
there.
    One of them that was one of the first, Frontier Energy 
Research Centers, designated by your Department in 2009. And 
since then, this center has made very significant advances in 
key energy technology, some of which we use every day, like 
photovoltaics and LEDs. In your testimony you say that the 
Energy Research Center's program is DOE's flagship--this is a 
quote--flagship investment in basic science that underpins 
future energy technologies. Music to my ears.
    Why is this program so important to DOE's efforts on 
climate change, and do you see this commitment remaining strong 
in the future?
    Secretary Moniz. Thank you.
    The EFRCs I think have been a tremendous success. I might 
say for the committee that originally there were 46 funded in 
2009, partly with Recovery Act funds. But it is worth saying 
this again, in a bipartisan spirit, that the setup for the 
EFRCs came from an exemplary process run by the Department of 
Energy during the Bush administration, several years of 
convening workshops of 1,500 scientists to define the key 
science challenges that underpin future energy technologies.
    They have been tremendously successful. With the ARRA 
funding falloff, regrettably we have had to lower the total 
number. But in fiscal year 2016, we are proposing a 10 percent 
increase to be able to get a few more of those operating. They 
have been tremendously successful, and I think are very 
important for the future of clean energy in this country.
    Mrs. Capps. And that leads me right into my second 
question, because while some marketplace applications are 
already there, it is so essential that these come out of the 
lab setting, out of research institutions, and get into our 
economy and help to build that economy in the right direction. 
And that is why I was so pleased to see the increase in your 
budget.
    ARPA-E provides essential research and development funding 
from the government, but the part we need to stress even more 
is the generation of private funds that have already and will 
continue to drive our economy. Will you elaborate on this?
    What is the ratio between I call it startup funds that come 
from the Federal Government, and how does that impact the 
private sector? Because that is what motivates me when I see it 
becoming an economic driver right in my congressional district.
    Secretary Moniz. First of all, the ARPA-E program is 
another example of, I think, a tremendously successful program. 
And we have requested an increase from $280 to $325 million.
    By the way, the ARPA-E Summit is going on as we speak out 
at the convention center, and I was there this morning. And it 
is just remarkable technologies. And I would like to say here 
that we have some first discussions going on about potentially 
bringing to the Congress an exhibit of some of the ARPA-E 
technologies. I think it would be a great science fair for us 
to have here.
    In terms of the impact, the fifth anniversary of the first 
ARPA-E contract will be coming up in March. So now that we are 
at the 5-year mark, what we are seeing is a lot of these 
projects getting into the marketplace. Big leverage in terms of 
investment. I know one class of projects just drew in $800 
million of financing. But, also, five of the projects now have 
been essentially bought by much larger strategic investors. For 
example, a big American defense firm just took that. So these 
are becoming into the marketplace 5 years. That is a pretty 
good track record.
    Mrs. Capps. Chairman, I am going to yield back.
    But I think that was a very practical suggestion. It would 
be interesting to work with the Science Committee to see if 
there could be some kind of demonstration here----
    Secretary Moniz. Yes.
    Mrs. Capps [continuing]. On Capitol Hill for what we are 
doing.
    Secretary Moniz. If I may just, we had last fall, I 
thought, a very successful--I think some of you may have come--
a very successful lab day, where we showed results out at the 
laboratories. And I think now it would be nice to complement 
that with an ARPA-E day.
    Mr. Whitfield. Thank you, Mr. Secretary.
    And at this time I recognize the gentleman from Texas, Mr. 
Olson, for 5 minutes.
    Mr. Olson. I thank the chair and welcome Dr. Moniz.
    I want to start with a few thank yous, my friend. Thank you 
for going to India this past March and making exports of U.S. 
energy a top priority between India and America. Thanks for 
that. Very important back home.
    Also, thank you for the role your Department played in the 
Petra Nova project in the Parish power plant in my district, 
the first true carbon capture enhanced oil recovery operation 
in America that will be viable. Thank you for that.
    Secretary Moniz. And under construction.
    Mr. Olson. Yes, sir.
    Secretary Moniz. All right.
    Mr. Olson. My first question is about our national security 
infrastructure. It has been under attack. Last April, snipers 
shot up a Silicon Valley substation. In 19 minutes, they fired 
off rounds almost causing a blackout in Silicon Valley. Twenty-
three pipeline companies have had cyber attacks. Your 2016 
budget doesn't address these attacks. You spend six times more 
on solar than secure power lines and secure pipelines. And I am 
sorry to put you on the clock, but in 1 minute, can you tell us 
your views on protecting our energy infrastructure, what is 
your role?
    Secretary Moniz. Yes. There are several things to say about 
that. It is a very important problem.
    Number one, the quadrennial energy review, first 
installment, on infrastructure will have a significant focus on 
resilience against multiple threats; extreme weather, cyber, 
physical, geomagnetic storms, which actually have occasionally 
hit the system. That is one point.
    Second point is, first of all, I want to thank the 
Congress. In the fiscal year 2015 budget, there was funding 
included for us to build out our emergency response center for 
the energy system so that we will have better situational 
awareness about threats to our system. We will be implementing 
that this year.
    Third, we have a substantial cybersecurity crosscut in the 
budget.
    Fourth, we convened, under the deputy secretary--it has 
been going on now for a few years--a very high level, a CEO-
level electric utility group specifically on cybersecurity. And 
including the fact that we have granted security clearances to 
a select number of leaders so that we can go deeper into the 
threat space.
    Mr. Olson. Well, thank you. And thank you, that was 1 
minute exactly.
    My next question is about EPA working with you and FERC. 
EPA's regulations are closing many base-load power plants, 
mostly coal plants. And those that remain open may have to go 
offline at times for retrofits. Our grid will look very 
different in 2020. And there could be local brownouts, local 
blackouts. Some have complained that EPA is seeking advice on 
the impact of its rules after the fact and in a very ad hoc 
way.
    My question, sir, is will you object to creating a process 
where EPA consults with FERC and DOE as new air rules are 
written? Yes or no?
    Secretary Moniz. Well, the answer is ``yes'' in the sense 
that it happens. We provide technical assistance, and that is 
with both EPA and FERC.
    Mr. Olson. How about we create a formal process review of 
EPA, FERC, and you? Object to that? Because right now that 
doesn't exist. It is sort of informal. How about a formal 
process of review----
    Secretary Moniz. Well, I think we have to review specifics. 
But I think it happens now in the sense that certainly any rule 
that goes through OIRA and then goes out for agency comment, in 
addition to our direct technical consultation there. So I think 
I would have to look in terms of what enhancement would be 
being looked at. But I am certainly happy to have that 
discussion.
    Mr. Olson. OK. Thank you.
    One final question about a bill I had last Congress. It is 
a bipartisan bill with myself, Mr. Green, and Mr. Doyle. It 
guarantees that if a power plant is ordered to briefly run and 
exceed its permits during an emergency situation, that--this is 
under Section 202(c) of the Federal Power Act--other regulators 
can't interfere and shut them down.
    Your predecessor, Mr. Chu, said, ``Good bill.'' He supports 
it. I asked you last time you were here. You had just got here 
and hadn't looked at it. So you have had some time. Support the 
bill?
    Secretary Moniz. I am going to have to look at the bill. 
But this is about engaging----
    Mr. Olson. Power crisis permits----
    Secretary Moniz. Federal Power Act----
    Mr. Olson. Yes. We can find some----
    Secretary Moniz [continuing]. Authority.
    Mr. Olson [continuing]. Back in Texas--well, across the 
country, where there has been a power crisis, there has been a 
heat wave, a cold snap, there has been--plants have been 
ordered to stay online, exceed their emission permits. They 
have been sued. This bill stops that. This says if it is a true 
crisis, you can exceed your permits for 60 days and review it.
    Again, common sense, keep the power up, keep people cold in 
the summer and hot in the winter. Do you support the concept of 
having one voice, the power regulator decide what will run, 
what won't run?
    Secretary Moniz. Well, again, I think we will have to 
follow this up. But certainly the DOE has Federal Power Act 
authorities to order plants to run, at least for some period of 
time, to make sure reliability is there in a crisis. It is 
obviously something you don't want to use a lot. Frankly, it 
was used the last time I was here at the end of the 1990s in 
California. Secretary Richardson had to order some plants to 
run to avoid blackouts.
    Mr. Olson. And that is fine. But they have been sued. The 
power generator said keep that plant up and running. They were 
sued. Mirant in San Francisco got sued for doing what the 
regulators said to do. That is what this bill tries to stop. 
Let them keep the power up without penalty.
    Secretary Moniz. We will look at this and get back to you.
    Mr. Whitfield. The gentleman's time has expired.
    At this time I recognize the gentleman from Pennsylvania, 
Mr. Doyle, for 5 minutes.
    Mr. Doyle. Thank you, Mr. Chairman. Mr. Secretary, welcome. 
It is always a pleasure to have you here in front of the 
committee.
    Mr. Secretary, as you know, I have a keen interest in the 
National Energy Technology Lab for many reasons, but most 
especially because of the outstanding work that NETL is doing 
in implementing the mission of DOE's Office of Fossil Energy. 
The work of the NETL is critical to the people of southwestern 
Pennsylvania, as well as many other States in our entire 
Nation.
    Recently, a commission has been created. It is currently 
working to examine missions and effectiveness of DOE national 
labs, including the NETL. And, in fact, the commission is in 
Pittsburgh today as we speak, preparing to make 
recommendations, including privatizing the lab, which I think 
would be a huge mistake and unacceptable.
    Can you share with us your perspective on the efficacy of 
the NETL and what you see as the future for our national labs? 
Are there specific areas of concern that you have or have been 
brought to your attention? And I would like to say that I know 
we have had you in Pittsburgh several times, and we certainly 
appreciate it. But your schedule hasn't permitted you to 
actually visit the NETL in Pittsburgh.
    Secretary Moniz. Right.
    Mr. Doyle. And I would like to contact your office and 
reach out to you and see if we might be able to schedule a 
visit----
    Secretary Moniz. OK. Yes.
    Mr. Doyle [continuing]. To the lab in Pittsburgh. But could 
you talk a little bit about this commission?
    Secretary Moniz. Yes.
    Mr. Doyle. And any concerns you may have?
    Secretary Moniz. OK. I have been to the Morgantown site, 
but--I think I have another scheduled in Pittsburgh.
    Mr. Doyle. I am sure the gentleman from West Virginia 
appreciates that----
    Mr. McKinley. That is right. He was there. He was there.
    Mr. Doyle. But it doesn't do much for us in Pittsburgh.
    Mr. McKinley. That is right. So that is right. Yes.
    Secretary Moniz. The----
    Mr. Doyle. I mean West Virginia is so friendly to the 
administration, I can understand why you are there first and 
not in Pittsburgh.
    Secretary Moniz. OK. So NETL. Look, NETL is our fossil fuel 
laboratory--just no ifs, ands, or buts about it--and has done 
very, very good work in the carbon capture sequestration arena, 
in methane hydrates, and in some of the hydraulic fracturing 
environmental impact work, et cetera, et cetera. So its future 
is--we have a new director, of course, relatively new director. 
And I think she will do a great job.
    First of all, you mentioned privatize. And I don't know 
what this congressional commission will recommend. But I have 
made it very, very clear that we have no plans to change the 
organizational structure of NETL as the one of our 17 
laboratories that is a----
    Mr. Doyle. Right.
    Secretary Moniz [continuing]. That is a Federal 
organization.
    Mr. Doyle. I appreciate hearing you say that. Can you tell 
me--we know NETL has been playing a role in identifying and 
developing and deploying numerous technologies that increase 
efficiencies and reducing the environmental concerns from coal-
fired plants, which is a big source of our electricity in 
States like Pennsylvania and others.
    Secretary Moniz. Right.
    Mr. Doyle. But if we are going to be serious about moving 
fossil energy research and development forward, I do have some 
concerns about the proposed DOE budget in 2016 for fossil 
energy. It seems to me that we need to establish scaled 
demonstrations of technologies that show our industry partners 
and the Nation that we have a serious commitment to this, 
specifically in areas of advanced combustion systems, 
gasification, advanced turbines, coal biomass to liquids, fuel 
cells, and rare Earth elements research. And much of this 
research, I should note, is being done in Pittsburgh at the 
NETL.
    I would really like to hear about your commitment to fossil 
energy R&D and where you see the role of this in America's 
energy portfolio and, also, to talk a little bit about the 
current status of DOE's CCS research, development, and 
demonstration efforts and what your agency is doing to develop 
a sustainable future for coal.
    Secretary Moniz. OK. There is many parts to that question.
    First of all, in terms of the commitment to advancing clean 
fossil fuel technology, clean coal technologies, again, I think 
we are demonstrably very committed. We are--we had a discussion 
earlier on the large integrated CCS projects, and I anticipate 
a good five of those will be fully successful and operating.
    We have right now opened an $8 billion loan guarantee 
program in fossil. And I can't talk about individual projects, 
but we are pretty happy with the proposal stream. I might 
note--this is not DOE, but in the fiscal year 2016 budget, 
there is the proposal for new tax credits, investment tax 
credits for CCS and a tax credit for sequestering 
CO2 . So that is very strong.
    Then, of course, we have our R&D program, which is in 
fossil energy and also in ARPA-E. We shouldn't forget ARPA-E 
also has programs in methane detection, carbon capture, et 
cetera.
    So it is a very, very broad program. You mentioned also 
rare earth elements. That is the study that the Congress asked 
for, I believe is within a 2 or 3 months probably about 
addressing the questions about whether or not coal ash, et 
cetera, is a viable source of rare warths. And I don't know the 
answer. If the answer is yes, then we should discuss how to 
implement.
    Mr. Doyle. Thank you, Mr. Chairman. I look forward to 
following up with you on the Pittsburgh visit.
    Secretary Moniz. Great.
    Mr. Whitfield. At this time I recognize the gentleman from 
Ohio, Mr. Latta, for 5 minutes.
    Mr. Latta. Well, thank you, Mr. Chairman.
    Thanks very much, Mr. Secretary, for being with us today. I 
appreciate your testimony.
    If I could talk a little and ask a few questions about the 
American Medical Isotopes Reduction Act of 2012. As part of 
that, the Department of Energy is to develop a program to 
assist in the establishment of the domestic production 
capabilities for medically vital isotopes like Mo-99--I think 
it is also pronounced ``moly 99.'' And that is used in nuclear 
medicine to perform life-saving procedures related to both 
heart disease and staging of cancer, two of the largest killers 
in our country.
    The motivation behind all of this was to address the fact 
that foreign production facilities that are scheduled to cease 
production in 2016. In the Western Hemisphere, the only place 
that is producing it is in Canada and, I believe, that they are 
going to be going out, unless something changes, I think, in 
2016 when that occurs.
    Then, as you look around the world where there might be 
production, in Europe I think there is five different 
facilities and one in Russia. I think there is one in--or two 
in South Africa and also in Australia. But, also, what this 
produces has a shelf life of only about 66 hours. So to get it 
from point A to point B to this country is vital to make sure 
that it is not degrading during that period of time, that it is 
not only 50 percent effective when it gets here.
    So I guess the first question is: When the supplier in 
Canada ceases its isotope production in 2016, what is the DOE 
doing to ensure that there isn't a shortage that would affect, 
I think, the United States using probably 50 percent of the 
world's isotope?
    Secretary Moniz. Well, as we continue to develop 
capabilities, one of the important developments in the last 
week was that Canada announced that it will maintain the 
capability until 2018 if required. So they have made that 
announcement. And without getting into too many specifics, we 
would work with them to see that that 2018 date could be met. 
And in the 2018 timeframe, then I think we are much more 
assured of continued isotope.
    Mr. Latta. Well let me ask this. OK. If we go from 2016 to 
2018, but at the same time is there the thought that the United 
States ought to be manufacturing it right here in the United 
States? And if that is the case, how long would it take from 
start to finish to be able to produce a facility that could 
produce that isotope?
    Secretary Moniz. Sir, I am going to have to get back to 
that in terms of exact timeline. I just don't have that----
    Mr. Latta. OK.
    Secretary Moniz [continuing]. On my fingertips, I am 
afraid. But we will get back to you on that.
    Mr. Latta. Because at the same time, if you could also get 
back on the whole question really if it is going to be longer 
than 2018, is there a way that this could be expedited to make 
sure that we don't have that----
    Secretary Moniz. Yes.
    Mr. Latta [continuing]. Shortage in the United States then?
    Secretary Moniz. Yes.
    Mr. Latta. It would be very, very helpful.
    Secretary Moniz. No. It is a very important point. And we 
will get back to you.
    Mr. Latta. Thank you.
    Switching gears a little bit, what legislation would be 
most helpful to the NRC to be able to quickly licensed a DOE 
developed gen-4 reactor? What is out there that we should be 
doing to get to that next level?
    Secretary Moniz. Well, I can't speak in detail for the NRC. 
But I think that their appropriated funding is quite modest, I 
believe. And it is a question of staff to get educated, trained 
in terms of alternative technologies.
    For some technologies, like the light water-based, small 
modular reactors, that is not as big a step away from the 
current regulatory basis. But if you start going into fast 
reactors or some of the more exotic molten salt reactors, you 
put your finger on a very important point. They need to get 
staffed up and ready to regulate such things.
    So it would be staff--presumably paid for either out of 
appropriations or out of some way of having the industry 
support them through some fee. I really don't know in detail, 
but that is, I presume, the only two sources that are possible.
    Mr. Latta. If I could just go back to your opening 
statement--because I didn't really see it in your written 
statement. And I tell you we take so many notes up here. But 
you were mentioning about the energy boom in this country. 
Would you attribute that energy boom especially to the 
advancements we have had in fracking in this country to be able 
to bring up that natural gas and oil that we have right now?
    Secretary Moniz. Oh, quite clearly. For gas and oil, 
hydraulic fracturing has been critical. We are still increasing 
our production in the Gulf of Mexico. But the big increases, 
certainly in gas, have been from hydraulic fracturing.
    Mr. Latta. Thank you very much, Mr. Chairman.
    My time has expired, and I yield back.
    Mr. Whitfield. The gentleman yields back.
    At this time I recognize the gentleman from New York, Mr. 
Tonko, for 5 minutes.
    Mr. Tonko. Thank you, Mr. Chair.
    And, Secretary Moniz, thank you for being here this 
afternoon. And more importantly, thank you for leading the 
Department with such vision and intellect. And your team is 
great to interact with.
    Secretary Moniz. Thank you.
    Mr. Tonko. I appreciate that.
    In general, I express my strong support for the research, 
development, and demonstration funding that is included in the 
budget request for this year. Innovation is indeed the fuel 
that will drive progress and create new industries and, 
therefore, new jobs.
    Mr. Secretary, wind and solar technologies are advancing at 
a rapid and steady pace. I fully support the increase in R&D 
for these and other renewable technologies. We hear a lot about 
wind and solar. We hear less about geothermal energy.
    I see that in the fiscal year 2016 effort, the 
administration is proposing a significant increase for work in 
this area, including funding for research and demonstration 
sites, dubbed FORGE. Could you expand, please, a bit on the 
goals for this funding and on the promise that this technology 
holds?
    Secretary Moniz. Well, first, in terms of the promise, 
engineered geothermal systems, hot rock systems, roughly 
speaking, have been looked at as having a promise in the United 
States of perhaps as much as 100 gigawatts of power. That came 
out of the 2005 report that the Department commissioned led by 
MIT, I might say. Not by me.
    So we are talking certainly many 10s to 100 gigawatts as 
the kind of range of potential. However, the scientific base 
has not been adequately laid. And that is what the FORGE 
project is to do, to have a highly instrumented experimental 
facility that can better do things like direct control 
fractures, et cetera, that are a huge part of how you engineer 
a geothermal system--an engineered geothermal system.
    Mr. Tonko. Thank you.
    And I am pleased to see that there is a proposed increase 
in funding for great modernization for the Office of 
Electricity Delivery and Energy Reliability.
    As you know, the electricity sector is undergoing a 
significant transformation, driven by a number of factors. I 
believe there is a Federal role in helping to smooth out those 
bumps in the road, so to speak.
    So, you mentioned the energy storage and integration work 
that the Department is doing in partnership with Southern 
California Edison. The budget proposal includes funds for State 
energy and reliability and the assurance grants. That is a new 
program.
    Will these grants be used for projects similar to the one 
that we have had with Southern California Edison?
    Secretary Moniz. Well, they certainly could be. But they 
will be broadly based and to individual States to determine. 
They will be planning grants, not project grants. But our hope 
is that the planning grants will lead to project grants. For 
example, in the QER we will specifically talk about how the 
State assurance plans that we have proposed could be 
essentially part of the--almost the requirements for then 
accessing other funds for projects.
    Mr. Tonko. Thank you. There are many aspects of the 
Department's portfolio that directly or indirectly address 
climate change. I would like to hear a bit more about DOE's 
proposed work to reduce methane emissions associated with 
natural gas development and delivery. It is an important 
emission that needs to be addressed. So is the Department going 
to explore some new activities here with those emissions?
    Secretary Moniz. Yes. In particular, we hosted five 
stakeholder round tables specifically on methane strategy last 
year. What I want to note is that our focus at DOE is not so 
much on the production end, it is on the mixed stream, if you 
like, so then the transmission pipes and then getting to the 
distribution systems.
    On the transmission pipe in particular, compressors are a 
big issue. We are looking at standards for compressors. And we 
are also funding new technologies for leak detection, for 
example. In fact, this morning at ARPA-E I saw a very elegant 
one. The ARPA-E, I believe, has right now 13 methane detection 
projects going on.
    Mr. Tonko. Now, are you doing this in partnership with the 
industry, the work on the emissions?
    Secretary Moniz. Well, the ARPA-E projects, many of them 
are being done by industry, typically small companies and some 
by universities.
    Mr. Tonko. And is it an effort that will require new 
technology, or is it just making an effort to----
    Secretary Moniz. No. It is new----
    Mr. Tonko [continuing]. Improve the technology we have?
    Secretary Moniz. It is novel technology to try to get 
effective, sensitive, inexpensive technologies. For example, 
the one I saw this morning out at the ARPA-E involved a novel 
use of carbon nanotubes to detect methane with high 
specificity.
    Mr. Tonko. OK. I yield back.
    Mr. Whitfield. The gentleman's time has expired. At this 
time I recognize the gentleman from West Virginia, Mr. 
McKinley, for 5 minutes.
    Mr. McKinley. Thank you, Mr. Chairman.
    I would like to follow up on the remarks that the 
congressman from Pennsylvania was talking about with NETL.
    And I just wanted to get maybe a little bit more specific 
with this. Because just in the next 2 years, Mr. Secretary, 
when you think about the facility in both Morgantown and 
Pittsburgh, maintaining the level of research, personnel, and 
all of their attributes of what they are doing, on a scale of 1 
to 10, what do you think it is going to look like 2 years from 
now? Be the same?
    Secretary Moniz. Well, I think in terms of scale it will 
probably be very, very, very much the same. Yes.
    Mr. McKinley. Is it like a 10? You think that there will 
be--it will be on the high level, that we can anticipate that 
that facility isn't going to change much in the next 2 years?
    Secretary Moniz. Again, it is not going to change in terms 
of organizational structure. It is going to, I think, be very 
comparable in size. But hopefully, when you look inside, you 
will see change, of course, as projects evolve. One of the 
things that we are doing right now----
    Mr. McKinley. OK. I just wanted to get----
    Secretary Moniz. Yes. OK.
    Mr. McKinley [continuing]. We can have a conversation----
    Secretary Moniz. Like I said, but the large-scale 
computation at NETL is being upgraded.
    Mr. McKinley. OK. Thank you.
    I noticed the other day that the administration--through 
DOE you had invested in some more projects in carbon capture in 
China. Is that accurate?
    Secretary Moniz. I am not aware of any specific project, 
no. We--in the----
    Mr. McKinley. There were clean coal projects there. I think 
it was carbon capture is what it was. But that leads to my next 
question.
    Secretary Moniz. I could be wrong. But I can look into 
that.
    Mr. McKinley. If you could.
    Secretary Moniz. But we do have--in the October agreement 
of Presidents Obama and Xi, it did say in there something that 
still remains to be designed that we would work together on a 
specific sequestration project instrumented.
    Mr. McKinley. So having said that, though, when I read 
that, it tipped off, then, where else--if we are investing 
money in clean coal or whatever energy projects in China, where 
else are we investing money----
    Secretary Moniz. No.
    Mr. McKinley [continuing]. Outside the United States?
    Secretary Moniz. If I may clarify. So we have a clean 
energy research center with China. It is $10 million a year. 
That is spent in American laboratories and universities, et 
cetera. It is matched by the Chinese, and both of our 
contributions are matched by industry.
    Mr. McKinley. OK. Well, that is really where I was going, 
is to find out are we investing in bricks and mortar or are we 
investing in research? And you are saying it is in research. So 
if it is in research, will we own the intellectual rights to 
that based on the research we have done? Or will it be 
something shared with the Chinese? Let me leave it at that. 
Will we own the rights?
    Secretary Moniz. The IP issues are very much a part of the 
discussion of every project.
    Mr. McKinley. OK.
    Secretary Moniz. There is a lot of progress on that.
    Mr. McKinley. OK. Next----
    Secretary Moniz. So we are protecting our IP rights.
    Mr. McKinley. What about other governments? Are we 
investing in other countries around? Because we seem to have 
ceded Africa to the Chinese in developing energy that we----
    Secretary Moniz. We----
    Mr. McKinley [continuing]. Backed off.
    Secretary Moniz. First of all, we have a very similar 
matching funds arrangement with India on some joint projects, 
including biofuels, et cetera.
    With Africa, the main investment--again, we tend to provide 
a lot of support, but the main investment comes from AID. So it 
is Department of State funds.
    Mr. McKinley. If I could, I am fearing I am going to run 
out of time.
    I think that the--everyone has, on the other side of the 
aisle, they have been quick to dodge and talk about there is no 
war on coal, but there is obviously a war on coal.
    Secretary Moniz. I disagree.
    Mr. McKinley. And it made people very nervous all around 
the United States about this. That is why these elections have 
consequences, and you have seen what has happened in some 
States as a result of it.
    So I am just curious, because we have got a trade agreement 
coming up. And I have this very strong suspicion that there 
some climate change issues are going to be part of that. Can 
you give me any indication--have you shared anything with the 
administration, or have they talked to you about what 
conditions--it has already been telegraphed a little bit--when 
he went to China and set that deal with China that they could 
increase their CO2 emissions until 2030, while we 
were supposed to decreased ours by 2015, and then went to India 
and cut a deal with India that they would use less coal and 
more nuclear.
    That, to me, was telegraphing that he is going to export 
his war on coal to other Nations. I am concerned about what 
else could happen with the various trade agreements that are 
going to come up. Do you see any component of fossil fuel--the 
emissions of greenhouse gases or anything else going to be in 
any trade agreement?
    Secretary Moniz. I certainly don't know that. I can say 
that when Ambassador Froman has asked me or us for information, 
it has been mainly on oil and natural gas.
    Mr. McKinley. OK. Because I think we ought to be very wary. 
He has already indicated what he has done with two other 
countries. And to add a host of other Nations, 19 other Nations 
into it, I would be very nervous about supporting any trade 
agreement as long as there is a potential of cutting back on 
the use of fossil fuels.
    Apparently, I am running out of time.
    Mr. Whitfield. The gentleman's time has expired.
    Mr. McKinley. He is going to yell at me here.
    Mr. Whitfield. At this time, I recognize the gentlelady 
from Florida, Ms. Castor, for 5 minutes.
    Ms. Castor. Thank you, Mr. Chairman.
    Welcome, Mr. Secretary.
    Secretary Moniz. Thank you.
    Ms. Castor. The Obama administration's energy policies are 
really paying off for American consumers. As the economy 
recovers and more people are working, unemployment is down, to 
have gas prices at the lowest level in 6 years is a great thing 
for so many families and businesses.
    I never thought that I would see gas prices below $2 again. 
But they have these Web sites now where you can go and find the 
lowest--the gas station in your neighborhood. And I just 
checked back in Tampa. I still found one below $2, although 
most are at $2 or a little bit more. So the energy information 
group under your purview said that that is going to save 
consumer families $750 a year.
    Secretary Moniz. Average household savings.
    Ms. Castor. The average household savings. So that comes at 
a great time. And it is part of the strategy, part of what we 
have seen on reduced demand for energy and increased supply. In 
recent years, the U.S. has experienced a natural gas boom, now 
one of the largest natural gas producers in the world.
    And then when you look at savings, the fuel economy is 
remarkable. It has improved year after year for vehicles in the 
U.S. The difference in miles per gallon or your fuel economy 
between 20 miles per gallon and 30 miles per gallon is $518 per 
year for consumers, or about $2,600 over 5 years. And now 
consumers have many more choices when it comes to vehicles. We 
have recently purchased a new car, and the sky is the limit on 
how many different kinds of hybrids, electrics. So I think the 
administration has been right on track.
    Then when you add in wind and solar energy--have tripled 
since 2008. The country is changing how it uses energy. The 
progress, when you sample it, is really impressive. This is a 
study, the Bloomberg New Energy Finance Report. Progress in 
clean energy has really been immense. It says wind and solar 
have achieved liftoff, and the renewable energy story keeps 
getting better, too. In 2007, according to Bloomberg and the 
Business Council for Sustainable Energy, renewable energy 
provided just 7 percent of the Nation's total. But by 2014, it 
had nearly doubled, to 13 percent. That is a real success 
story.
    And then we have seen great improvement in energy 
efficiency, too. This is the most cost effective area. But I am 
still not convinced that we have unleashed the power of 
consumers to really conserve energy and use the existing and 
emerging technology to help them save money and help us all 
conserve energy.
    What is in your budget specifically on energy efficiency 
that will help partner with businesses, the technology 
companies, and unleash the power of consumers to control their 
thermostat or for businesses to do better in saving costs?
    Secretary Moniz. So we do have in the budget a proposed 
increase for building technologies. And those building 
technologies can be everything from external skins of buildings 
and windows to things like smart thermostats and smart 
everything there.
    But I want to emphasize that besides the budgetary 
approach, let me just mention two other things that we do to 
address the demand side. One is, of course, efficiency 
standards. Setting standards for appliances, electric motors, 
et cetera, and keeping at the technology, not at, but maybe it 
is only a little bit behind, at least, the technology frontier. 
That is very important.
    It is not appreciated so much that if we take all of the 
efficiency standards that have come into effect during this 
administration and those that we project for the next 2 years, 
and then we ask for the cumulative impact to 2030, the 
projection is about $450 billion--that is a B--of energy 
savings for consumers and about 3 gigatons of CO2 
avoidance. That is one approach.
    And then finally, the third approach, besides technology 
and standards, is just convening. So we do something called a 
better buildings challenge, for example. All we do is we 
convene companies that volunteer to meet a 20 percent energy 
intensity reduction by 2020. We give them some branding, and 
they agree to share best practices with others. It is really 
fantastic. Some companies reach their 2020 goals in like 3 
years and then double down. So it is a broad-based approach to 
efficiency.
    Ms. Castor. I will add that to my list.
    Mr. Whitfield. The gentlelady's time has expired.
    At this time, I recognize the gentleman from Illinois, Mr. 
Kinzinger, for 5 minutes.
    Mr. Kinzinger. Thank you, Mr. Chairman. Mr. Secretary, 
thank you for being here and giving us your time. And thank you 
for your service to the country.
    I just have a few questions I am going to get right into.
    Do you believe that the Federal Government should use a 
coordinated process to assess the impact of policy decisions on 
national security and foreign policy?
    Secretary Moniz. Yes. In many ways, that is what the 
quadrennial energy review is all about, trying to get an 
integrated coherent approach.
    Mr. Kinzinger. OK. And would you agree that Federal 
decisions for everything from rule making to project reviews 
and export licenses impact energy diplomacy?
    Secretary Moniz. Well, I would say selectively. I think we 
would need to talk about examples.
    Mr. Kinzinger. Well, I believe it is vital that we ensure 
the United States' role as a leader in the nuclear technology 
export market, that it is maintained. China and India have 
increased their nuclear generation capabilities twentyfold, and 
Russia has recently taken the lead in the $500 billion nuclear 
technology export market. In fact, just yesterday it was 
announced that Russia and Egypt signed an accord with one 
another that puts Russia in charge of creating a nuclear plant 
in Egypt.
    Let me ask you about the DOE's role in enhancing U.S. 
manufacturing and competitiveness through your nuclear export 
control policies. Would you agree that strong nuclear exports 
will not only contribute to strengthening domestic job growth, 
but that it will also benefit U.S. influence over international 
nuclear safety and security?
    Secretary Moniz. Yes.
    Mr. Kinzinger. OK. It is an interesting sidenote, too, 
because I think it is--for every $1 billion in exports in this, 
it is something like 10,000 jobs are created, which is--and 
especially for my district, it is huge, too.
    Secretary Moniz. May I just add to reinforce that, also, 
frankly, the United States, I would say, is the gold standard 
in terms of nonproliferation norms in energy commerce. So 
maintaining a strong role in that commerce is very important in 
that point, too.
    Mr. Kinzinger. Yes. And I agree with you. But my concern, 
though, is, as you see, all these other countries, especially 
Russia, proliferate their nuclear exports. We may have the gold 
standard. We may negotiate gold standard agreements. But the 
Russians don't necessarily have the same standards we do, which 
is why I think that is so important.
    Ensuring peaceful use of civilian nuclear technology is a 
core mission and responsibility of yours as the Secretary of 
Energy. What are you doing to ensure that the U.S. is a leader 
in the peaceful use of civilian nuclear technology?
    Secretary Moniz. Well, for one thing, I think there is no 
doubt about it, I think we have, first of all, advocate for 
that and help. I mean we shouldn't lose sight of the fact that 
we do have quite a bit of nuclear technology being built 
elsewhere. I mean, in China, for example, there may be like 18 
Westinghouse AP1000s, for example. And just recently in the 
President's trip to India, there was real progress made in 
terms of implementing that agreement.
    And frankly, again, I and others in the administration, 
when we visit many Eastern European countries, for example, we 
certainly advocate strongly for the value of U.S.-based 
technology.
    Mr. Kinzinger. And I know many of us do when we do our own 
traveling, too.
    Secretary Moniz. Right.
    Mr. Kinzinger. You have been working on the first revision 
of the nuclear export procedures. That would be the first 
revision in more than 25 years. My only concern is this has 
been in progress for a little more than 3 years already. Why is 
it taking so long for the Department to reform its nuclear 
export procedures?
    Secretary Moniz. I think it is fair to say that we will be 
finishing that process very, very shortly.
    Mr. Kinzinger. OK. Good. And according to the GAO report 
issued as part of the committee's ongoing nuclear oversight 
last year, DOE does not have a clear timely, efficient review 
process. Some reviews can take more than a year, depriving the 
U.S. Companies from entering into commercial negotiations. Will 
you commit today that you will ensure that the Department is 
addressing fully the GAO report recommendations?
    Secretary Moniz. We have done and will do all that we can 
to expedite these. I just wanted to caution that, while we are 
perhaps the signatory in the end, it is a multi-agency review 
process and----
    Mr. Kinzinger. And that can get messy. But I just want to 
make sure, at least at your level, it is receiving senior 
attention.
    Secretary Moniz. Yes.
    Mr. Kinzinger. So hopefully that is the case.
    And then lastly, what is the DOE's plan to ensure that 
Federal agencies continue to use private sector funding and 
expertise to meet their energy efficiency goals through energy 
saving performance contracts, or ESPCs? And what is the biggest 
barrier to increasing the use of ESPCs by the Federal 
Government?
    Secretary Moniz. Well, the ESPCs certainly have been very 
effective. And I will be honest, I have lost a little track of 
how many commitments we have--I think we are over $2 billion 
now in terms of ESPC contracts. One of the issues there is, and 
of course, you know, the President has asked us to double that 
to $4 billion, which is going to be a real push.
    But one of the issues is that more and more the projects 
take on a different character than the initial projects. A lot 
of the low-hanging fruit, in a certain sense, in terms of 
direct energy savings may have been--have been done. And now it 
is a question of things like deeper retrofits that have to be 
done. So that is a little bit of an issue we are dealing with 
in going forward.
    Mr. Kinzinger. Understood. Thank you. Thank you for being 
here.
    And I will yield back.
    Mr. Whitfield. At this time, I recognize the gentleman from 
New Jersey, Mr. Pallone, for 5 minutes.
    Mr. Pallone. Mr. Chairman, I would just as soon we continue 
with the other Democrats because I think we are going to have 
votes.
    Mr. Whitfield. At this time, the gentleman from Iowa for 5 
minutes, Mr. Loebsack.
    Mr. Loebsack. Thank you, Mr. Chair.
    And I thank the ranking member for going out of order. I 
appreciate that.
    And thank you, Mr. Secretary, for being here.
    I am very excited to be on the larger Energy and Commerce 
Committee, and on this subcommittee in particular. I am not new 
to Congress, but I am new to the committee and the 
subcommittee. And thank you very much again for being here 
today. And I have really enjoyed the testimony and the 
questions from folks from all over the country.
    I am from Iowa. Of course, there is a lot going on on the 
energy front in Iowa, as you might imagine. In your testimony, 
you state that DOE loans and grants have helped to support two 
commercial-scale cellulosic ethanol facilities, one of these 
located in my home State of Iowa. And as you know, these are 
critical for the country going forward.
    We often talk about corn ethanol. That is first generation 
ethanol. Cellulosic is second generation, and that seems to get 
a little more political support nowadays, although I am still a 
firm supporter, as you might imagine, of corn ethanol.
    But what percentage of funds would be set aside for these 
programs, or can you elaborate a little bit on what might be 
set aside for these particular second generation ethanol 
endeavors?
    Secretary Moniz. Well, there are a variety of approaches. 
And by the way, coming to the committee, if you would like a 
briefing, a broader briefing on DOE, we would be happy to 
arrange that for you.
    Mr. Loebsack. Thank you. I appreciate that.
    Secretary Moniz. Like, for example, with the loan program, 
then there is no specific set-aside for biofuels. That would be 
competing within a broader pool there.
    But if you look at some of our direct programs, one of the 
directions that we are going in now, in addition to the 
cellulosic ethanol, is moving towards drop-in fuels because 
those are--especially the military is very interested in that. 
It is a more complex process.
    We have--I believe it is something like $45 million in this 
budget request specifically for a project with the Department 
of Defense and the USDA in terms of looking towards--I think 
toward three projects for drop-in biofuels. So that is an 
example of what we are doing.
    Mr. Loebsack. OK. Thank you.
    And you mentioned, as you did in your testimony, about the 
investments in biofuels more generally. I don't want to 
implicate you in the whole renewable fuels standard debate.
    Secretary Moniz. Thank you.
    Mr. Loebsack. Certainly. That is for another cabinet member 
probably or two.
    But with the uncertainty of the blending guidelines out 
there, what does that mean for investments in the biofuels 
field, if you will? Do you have any thoughts about that?
    Secretary Moniz. Well, I think, as in all of the energy 
technologies, certainly having some stability and a clear 
projection, I think, is very important.
    So here, I think one of the issues that remains to be 
resolved--and you are right, I am not involved in the RFS--is 
the question of the vehicles. Is 10 percent really a blend 
wall? What is the future in terms of more flex fuel vehicles? 
So I think we often just focus on the fuel, but it is really 
the fuel-vehicle system, I think, that we need to address.
    Mr. Loebsack. Not to mention the infrastructure part of it 
as well?
    Secretary Moniz. And then comes the infrastructure issue. 
And that is where, of course, the alternative, for example, 
biomass-derived drop-in fuels----
    Mr. Loebsack. Right.
    Secretary Moniz [continuing]. Would resolve that, but at 
the cost of it being a much more complex process.
    Mr. Loebsack. Exactly.
    Finally, Iowa is one of the leading wind producing States, 
as you know. Wind energy producing States. About 27 percent or 
so of our electricity in Iowa is generated through wind.
    What kind of investments can we see set aside, if any, for 
the future as far as the wind industry is concerned? If you 
could elaborate on that a little bit.
    Secretary Moniz. Well, the programs continue to look at 
stretching the technology. For example, the materials for 
bigger blades, for example, is very important. One of the 
directions there is in the competitively awarded Manufacturing 
Institute on Composite Materials that we announced in January. 
That is one example. There is work in terms of different direct 
drive, for example, turbines for larger, higher efficiency 
machines.
    By the way, there is also, it is kind of low-brow, but when 
you go to the bigger blades you do have to worry about 
transportation logistics. And that is another issue.
    Mr. Loebsack. I might just say when you come to Iowa next, 
just go down Interstate 80, and you will see lots of those 
blades being transported across the State.
    Secretary Moniz. Yes.
    Mr. Loebsack. They have TPI Composites in Newton in my 
district.
    Secretary Moniz. Yes.
    Mr. Loebsack. We have Siemens in Fort Madison in my 
district.
    Secretary Moniz. Yes. Yes. That is great. Yes.
    And the last thing I will say is probably--it is probably 
slightly less relevant for Iowa, but we are looking at offshore 
wind as well in terms of trying to capture particularly a 
deepwater resource. But that will take a while to get into an 
economically competitive range.
    Mr. Loebsack. Thank you, Mr. Secretary.
    And thank you, Mr. Chair.
    Mr. Whitfield. We have a vote on the floor, and there is 
going to be three votes. And there is about 6 minutes left in 
the first vote.
    I am going to go to you, Mr. Griffith, for your 5 minutes. 
And then I would ask the other members who have not asked 
questions how many of you want to come back. My understanding 
is the Secretary has a 4 o'clock meeting. He has to leave here, 
at the latest, at 3:45.
    Secretary Moniz. Yes. A quarter of, yes.
    Mr. Whitfield. So how many of you would like to come back 
to ask questions?
    OK. Well, I will tell you what, then, we will go with you, 
Mr. Griffith. And I guess that would terminate the questions 
for the Secretary, unless you all want to come back. So why 
don't I recognize Mr. Griffith for 5 minutes.
    Mr. Griffith. Thank you, Mr. Chairman. I do appreciate it.
    Mr. Secretary, I heard you say something in your opening 
comments about a trilateral group that met regarding North 
American energy grid, and indicated that Mexico wanted to hook 
their grid into our grid. This immediately raised some concerns 
which I hope you can allay for me. And that would be that while 
workers in central Appalachia, and particularly in the 9th 
District of Virginia, which I happen to represent, are being 
laid off in the mines because of EPA policy, not DOE policy, 
but because of EPA policy, we have a situation where if we hook 
our grid into Mexico's, they could theoretically be sending 
electricity to the United States made with either Texan coal or 
Mexican coal or somewhere else they get it.
    I would note that Texas did approve a project, it appears 
based on the reports that I have got, in 2013 to send coal. 
Some people claim that it is not as good as coal that we would 
allow to be burned in the United States. But more importantly--
and I am quoting from an article in, if I am reading this 
right--heartland.org by Cheryl Chumley, ``U.S. Environmental 
Protection Agency restrictions on coal power make Mexico the 
most viable market for U.S. coal mines near the Mexican border. 
Mexico has relatively few restrictions on coal power plants 
relative to the heavy EPA regulations of U.S. coal power 
plants.
    And then there is the concern that in the Coahuila--and I 
hope I pronounced that correctly--region of Mexico, which 
borders Texas, that the Los Zetas, formerly drug gang, now coal 
mining gang as well, have taken over the coal industry. And 
they produce about 95 percent of Mexico's coal.
    So I just worry, if they hook in into our grid and then we 
have a shortage because we have had the EPA debilitate the 
ability to use coal in this country, that we will be using coal 
that is burned at lower standards, lower grade coal, where we 
have extortion and other things operating in the mines and a 
safety record for the workers that is abysmal. And I would have 
to ask you to be cautious on that.
    And I think you would agree with me that--we may not agree 
on how much coal ought to be used, but that when coal is used 
to provide American electricity, it ought to be done under 
American work standards and under American energy standards, 
and that we should not be allowing Mexico to backdoor the use 
of coal, particularly dirty coal, when we have lots of clean 
coal that my folks would like to be mining and are now finding 
themselves unemployed. You would agree with that, would you 
not?
    Secretary Moniz. With all of our international 
engagements--trade engagements, environmental and labor 
standards are critical, yes.
    Mr. Griffith. And the problem is, is that if you start 
wheeling that electricity in, it will have been made under 
their standards, and there is no way you can control that. 
Isn't that accurate?
    Secretary Moniz. Well, I think you have raised an issue 
that we need to be on top of. I do think that it is important 
to recognize, look, this is just an early start of a 
discussion. But to recognize that Mexico is also taking some 
pretty strong environmental positions. That is a discussion 
that will have to evolve. I mean, it is a good point.
    Mr. Griffith. All right. I appreciate that.
    I will tell you that I think the DOE does some good things. 
I am worried about the EPA. And I have got a much longer 
question, but my time is running out because I got diverted 
with the Mexican issue.
    But it appears that the EPA has asked in their budget 
request--and I am quoting now--evaluating and capturing these 
compliance strategies requires the Agency to tap into technical 
and policy expertise not traditionally needed in EPA regulatory 
development, for example, nuclear, wind, solar, hydroelectric, 
and demand side energy efficiency, and to understand and 
project systemwide approaches and trends in areas such as 
electricity transmission, distribution, and storage.
    I just have to you tell you, I often think that the EPA 
thinks that they don't need Congress. It sounds like, from the 
language in their budget request, they don't think they need 
the Department of Energy. What say you?
    Secretary Moniz. I can assure you that we--EPA and other 
agencies, FERC, others, do call upon us for technical analysis.
    Mr. Griffith. Well, but I don't have any problem with them 
calling on you for technical analysis. It seems like they want 
to set up their own technical abilities to do that analysis. 
And don't you think that would be wasteful spending on our part 
to approve that for the EPA when we already have your fine 
agency doing that work? And isn't it just another example of 
EPA overreach?
    Secretary Moniz. I appreciate the endorsement of our 
excellent work.
    Mr. Griffith. And I appreciate you, Mr. Secretary, as well.
    I have other questions that I am afraid I will have to 
submit for the record because our time is up.
    Secretary Moniz. Yes. Do that.
    Mr. Griffith. And we do have votes waiting.
    Secretary Moniz. Thank you.
    Mr. Griffith. But thank you so much for being here today, 
and I appreciate your good work.
    Mr. Whitfield. Mr. Griffith's time has expired. You have 
something, Mr. Flores?
    Mr. Flores. We will submit our questions for the record. 
Thank you for being here.
    Secretary Moniz. Thank you.
    Mr. Whitfield. Mr. Secretary, I have been told that some 
members did want to come back. I am sure we won't be back over 
here until 3:20 or so. Are you available until 3:45?
    Secretary Moniz. Yes. If we could think of 3:45 as an end 
date--end time, that would be great.
    Mr. Whitfield. Well, I tell you, if you wouldn't mind just 
waiting here for a few minutes. I am going to go to the floor 
to vote. I am going to ask the four or five members if they can 
come back, oK. If not, I will call----
    Secretary Moniz. OK.
    Mr. Whitfield [continuing]. And we will conclude the 
hearing. But thank you.
    Secretary Moniz. OK.
    Mr. Whitfield. Thank you, and thank you for being 
available.
    Secretary Moniz. Thank you.
    Mr. Whitfield. Yes. The correct term is recess subject to 
the call.
    [Whereupon, at 2:50 p.m., the subcommittee recessed, 
subject to the call of the Chair.]
    Mr. Whitfield. We will reconvene the hearing. And at this 
point I would recognize the gentleman from Texas, Mr. Barton, 
to resume his question and answer.
    Mr. Barton. Mr. Chairman, I am more than willing to, but I 
think Mr. Johnson is ready to go. I will let him ask his, and 
then I will ask mine.
    Mr. Whitfield. OK.
    Mr. Johnson from Ohio is recognized for 5 minutes.
    Mr. Johnson. Thank you very much, Mr. Chairman. And, Mr. 
Secretary, thanks for joining us again. It is always good to 
see you here.
    My line of questions deal with LNG exports and particularly 
around some of the diplomatic and global, international, 
implications of America getting into that market in a big way. 
In your opinion, will U.S. LNG exports improve the efficiency 
and transparency of international natural gas markets?
    Secretary Moniz. I think in general the more LNG that goes 
into the global market the more opportunity there is for market 
development.
    Mr. Johnson. OK. So I take that is a yes in terms of 
efficiency and transparency? That you think----
    Secretary Moniz. It is the whole LNG global market.
    Mr. Johnson. Right. OK. Do the EIA 2012 LNG export analysis 
and the 2014 update, the NERA economic consulting analysis and 
the NETL analysis, all commissioned by DOE, does that give DOE 
the sufficient data needed to make the public interest 
determination about LNG exports?
    Secretary Moniz. Last year when we modified the process, we 
said that we do have that set of analyses for up to 12 BCF per 
day. We are currently at 5.7, so we are still quite some 
headroom there. But we said we would need to commission, and we 
have done so, new analyses for going from 12 to 20 should that 
be called upon. We are still awaiting the contracted second 
study.
    Mr. Johnson. OK. When do you expect the Cove Point terminal 
to receive its final DOE approval?
    Secretary Moniz. I believe Cove Point has received its 
final approval. Anybody know? Well, I will check that.
    Mr. Johnson. Maybe we can mutually verify.
    Secretary Moniz. We will verify either way. But I would 
emphasize that the--I mean, we have no applications available 
right now for our final approval----
    Mr. Johnson. It was our understanding that, what I was 
expecting, was that you were waiting for FERC to reject their 
opponent's request for rehearing, but FERC is not under a time 
limit; therefore, they are waiting. So the question is are we 
waiting for FERC to do a rehearing? Does anybody know?
    Secretary Moniz. Again, I may be getting confused, but I 
thought we had approved Cove Point. OK. I am sorry? You are 
correct apparently, that we do not have a final approval, we 
are waiting for the EIS then from FERC.
    Mr. Johnson. So FERC does not have a time limit for their 
rehearing. Is there a policy requirement that DOE wait for FERC 
to deny the request for rehearing, or is it just DOE practice? 
Because I liked your first answer. I want it approved.
    Secretary Moniz. So we need to have the EIS in order to 
have the information on environmental impact for the public 
interest determination.
    Mr. Johnson. Is that what would come out of the rehearing 
process?
    Secretary Moniz. If FERC is having a rehearing that is what 
would come of it.
    Mr. Johnson. That is the problem. FERC is not under a 
timeline to do a rehearing, so it just sits there.
    Secretary Moniz. Look, I will go look into the status of 
that.
    Mr. Johnson. Could you, please?
    Secretary Moniz. Yes, I will. And it is just that again we 
need to have the adequate information for our making a public 
determination. Because we decided long ago, the Department 
before I was even at the Department, that we certainly didn't 
want to do a parallel environmental impact statement. So 
typically what we simply do is adopt the FERC statement.
    Mr. Johnson. OK. Shifting gears just a little bit, I want 
to commend you personally for including the $100 million in the 
fiscal year 2016 budget for the continued domestic uranium 
enrichment research and development and demonstration 
activities in Piketon, Ohio. This is a critical domestic need, 
national security--we have talked about that--to produce our 
own enriched uranium.
    The fiscal year 2015 CRomnibus contained language that 
directs the DOE to report to Congress by April 30 of this year 
with an accounting on the current and future availability of 
low-enriched uranium to meet our national security needs. Can 
you give us a status report on that report, and will the 
Department meet the 30 April deadline?
    Secretary Moniz. There is a very active multi-agency 
process going on right now with the aim to meet that target.
    Mr. Johnson. OK. Thank you very much.
    Mr. Whitfield. The gentleman's time is expired.
    At this time I recognize the gentleman from Kentucky, Mr. 
Yarmuth, for 5 minutes.
    Mr. Yarmuth. Thank you very much, Mr. Chairman.
    Mr. Secretary, thank you for being here. I just want to 
begin by applauding your willingness to bring the demonstration 
research to the committees. One of the things that obsesses me 
now is to try to figure out how we can make policy when things 
in the world are changing so rapidly. And we were talking 
earlier about the grid. And I read somewhere not too long ago 
where somebody has invented a way to transmit energy through 
sound waves, electricity through sound waves. And I am thinking 
if that is something that is actually viable and scaleable, 
then we might have a whole different alternative to the grid.
    So the things that I, as a matter of fact, I have thought 
it would be good for us to keep bringing futurists to the 
committee to talk so we can make decisions in context. So 
anyway, I appreciate that and look forward to it.
    One of the things that I have been so excited about in the 
energy field is that the Federally funded clean energy 
manufacturing initiatives have made a huge difference around 
the country, and specifically in my district. We have, because 
of the Federal initiatives, we have like 4,000 new jobs at Ford 
Motor Company manufacturing plant.
    We have several thousand new jobs at a GE appliance plant 
because they are producing now energy-efficient appliances that 
have benefitted from Federal tax credits. They brought a line 
of hybrid water heaters back from China, 420 jobs. So these 
types of programs can have a phenomenal benefit for the 
community. Can you talk about the initiatives going forward, 
what you are proposing in the budget, to continue that kind of 
initiatives to promote energy efficient manufacturing?
    Secretary Moniz. Well, there are many things. For one 
thing, for the Manufacturing Institute Initiative we are 
proposing to have full funding of two new institutes in the 
fiscal year 2016 budget. That would be very exciting. Those are 
competitively awarded. And typically in the competition so far, 
the States have stepped up very, very strongly in terms of 
matching those funds. So that is one very important initiative.
    And by the way, to go back to some earlier discussions, 
with those institutes we are also making sure we integrate 
training programs with them so that, you know, you can get a 
workforce in the area, et cetera.
    On things like the Ford plant you mentioned, I believe was 
part of the loan program in the ATVM. We still have $16 billion 
of authority left in that program, and we are encouraging 
especially suppliers for the auto industry to come forward. And 
we also have, of course, calls out for fossil renewables and 
efficiency and nuclear. And when you put those all together, 
those could really, really help move the needle, I think, as 
have the previous loans in terms of jobs and cutting-edge 
manufacturing.
    Mr. Yarmuth. There is one thing that I have been meaning to 
ask somebody, so you are a good person to ask. Several months 
ago--well, it is probably a year ago now--General Wesley Clark 
was speaking to a group that I was part of, and talking about 
he has been doing a lot of work in the energy field 
internationally and been travelling back and forth to China.
    And one of the things he was concerned about, he talked 
about a company in Washington State that had actually developed 
a process for baking coal, not for energy, but to get very 
valuable minerals. They had been able to do that. And they were 
looking for some venture capital, I think it was $75 million, 
and couldn't find it. So ultimately, a Chinese company came in 
and bought the technology that had been developed in the United 
States. Is that the type of situation that that loan program or 
maybe some other DOE initiatives might be able to accommodate?
    Secretary Moniz. I would have to see it in more detail. 
From what the sound of it, I don't think the loan program would 
do it. The loan program needs to push the technology envelop in 
an emissions-reducing technologies. Now, I don't know what the 
minerals are. For example, earlier we mentioned that there is a 
study going on right now that should be ready 2, 3 months, I 
would guess, on the question of whether or not coal or the coal 
combustion products are a viable source of rare Earth minerals.
    So that is the kind of thing that, if it looks positive, 
then we will come back and work with the Congress to see about 
a program there.
    Mr. Yarmuth. Great. Thank you very much. I yield back.
    Mr. Whitfield. At this time I recognize the gentleman from 
Texas, Mr. Barton.
    Mr. Barton. Thank you. Thank you Mr. Chairman.
    And thank you, Mr. Secretary. We appreciate your access to 
the subcommittee and the full committee. You have always been 
one of the most accessible Obama administration officials, and 
it is appreciated sincerely.
    I want to ask about the situation in the world oil markets. 
As you know, not too many months ago the price of oil was over 
$100 a barrel. Now it is below $50. Massive layoffs in the 
service industry in the oil patch and drilling programs. I 
talked to an independent producer in Texas this past week. They 
had 15 rigs operating a year ago. They have two today. And they 
are not completing the wells. They are just drilling them. They 
are not fracking them. They are just drilling the wells.
    I introduced H.R. 702 last week to repeal the existing ban 
on crude oil exports. I have heard you in other venues say 
reasonably positive things about that. I would like your 
position and the Department's position, and if you are able to 
give it the administration's position, if you all would support 
the outright repeal of the existing ban on crude oil.
    My bill also requires a study of the Strategic Petroleum 
Reserve. You know, we have got a fairly large SPR these days. 
And so we want to repeal the ban and then take a look at what 
the future is for the SPR. I would encourage your comments on 
those two issues.
    Secretary Moniz. Well, Mr. Barton, as you know, the crude 
export policy issue is one for the Department of Commerce to 
address. They did issue this clarification recently about 
lightly processed condensates.
    Mr. Barton. Well, they are granting permits on a case-by-
case basis, which is appreciated, but that is not a substitute, 
in my opinion, for a comprehensive policy. And it is much more 
cumbersome, it takes a lot longer, and it is not universal, as 
you well know.
    Secretary Moniz. That again, that is an issue that at the 
policy level Department of Commerce would address. I do always 
put in context that we do still import seven million barrels of 
oil per day. And I think that is an issue. That plus, of 
course, current low prices would severely impact, I think, what 
actually, you know, would be the ground truth. But obviously we 
have had some analyses done.
    EIA, for example, has published a piece that says the 
exports would probably have zero or a small negative effect on 
gasoline prices, for example, mainly because the Brent price 
tends to correlate with our product prices. So we will continue 
to do analysis that supports a decision.
    Mr. Barton. I know the Department of Commerce has to make 
these decisions, but I would assume if the President were 
thinking about making a change in law, since it is crude oil 
exports, he would consult with the Secretary of Energy. And you 
happen to be the Secretary of Energy. If the Secretary of 
Commerce were here, I would ask his position, but he is not 
here.
    Secretary Moniz. Her, her.
    Mr. Barton. And you are. I would also point out that we 
export about four million barrels per day of refined products, 
which is up considerably. So we have got a situation where the 
patient is half pregnant. We are exporting the refined 
products, but not allowing the crude. And it does give our 
refiners somewhat of a captive market for the domestic crude 
oil. And if we just went free market totally, I think everybody 
would be better off.
    Obviously, it would squeeze the profit margin of the 
refineries, because they would not be able to maintain that 
captured discount, which has fallen. It has been over $25 a 
barrel, but right now it is I think around $5 a barrel. So as 
the world prices come down, that discount that the domestic 
refineries are receiving is coming down too.
    In my last 37 seconds, FutureGen, the Department I think 
made the correct decision, sadly, not too long ago to stop 
funding that project. What is your position on the next step in 
terms of clean coal technology, carbon capture sequestration, 
or perhaps even carbon capture and conversion?
    Secretary Moniz. Well, first of all, I want to agree with 
your characterization that it was sadly, because getting an 
oxycombustion plant done would be a very good demonstration, 
but the ARRA funding deadline made it not viable. We remain 
very committed to that. We still have a bunch of projects 
coming, including in Texas the Petra Nova project, for example, 
will be coming on. There is the Summit project. And also the 
industrial facilities, the air products project, for example, 
also in Houston is operating.
    So we are going to keep pushing forward. And two things 
looking forward. In addition to our research on, you know, new 
capture technologies, et cetera, two issues going forward: One 
is we do have the active solicitation for $8 billion of loan 
guarantee for fossil projects with emissions reductions. And we 
have a--I can't talk about specifics--but we do have a very 
encouraging proposal stream.
    And, secondly, in the fiscal year 2016 budget, not from DOE 
but from Treasury, is the tax credit proposal for CCS. So a $2 
billion ITC for construction, including C02 infrastructure, and 
a sequestration----
    Mr. Barton. So you are still supportive of research into 
the technologies, bottom line?
    Secretary Moniz. Both research and deployment 
encouragement.
    Mr. Whitfield. We have four members still that would like 
to ask questions. I am going to ask each of you to cut it to 3 
minutes, if possible, because I know the Secretary is leaving. 
He will tell me when he has to go to get to his White House 
meeting, but--Mr. Sarbanes, you are recognized.
    Mr. Sarbanes. Thank you. Thank you for being here, Mr. 
Secretary.
    Could you maybe just give me 1 minute of my 3 minutes 
speaking to what you see as the benefits that are already being 
realized from the efforts, heroic efforts, of the Department of 
Energy over the last few years to just generally diversify the 
energy portfolio of the country. I have an impression that the 
falling gas prices in part can be linked to that general 
commitment to diversification because of the concerns and 
anxiety it produces overseas from OPEC and others.
    But if you could speak to that briefly and any other broad 
benefits you see from the diversification effort, which I think 
has been really terrific over the last few years.
    Secretary Moniz. Well, first of all, the diversification 
effort would go forward irrespective of where the oil price was 
going because this is a long-term investment, number one.
    Number two, very critical, and I would refer you to a 
little paper on our Web site called Revolution Now that shows, 
I think, the big story. The four technologies, including solar 
and LEDs, the vehicle batteries, it shows the tremendous cost 
reduction of those technologies going forward and the 
associated large deployment increase. That is the huge story. 
And that is, in the end, key to what we do trying to push the 
envelop and get the cost down for these technologies.
    Mr. Sarbanes. Great. Let me switch gears to another topic, 
which increasingly according to all the surveys that are coming 
back in the recent period, the American public is now very 
focused on the effects of climate change. And it appears with 
each passing day, more and more are convinced that we need to 
step up and address this in a sustained fashion. And I think 
that is right.
    In your testimony, you talk about the sequestration of over 
nine million metric tons of CO2 through DOE-
supported projects. You talk about the efficiency standards 
that have been issued in calendar year 2014, and what that will 
mean between now and 2030; that since 2009, you are projecting 
that you will have a 2.2 billion metric ton of carbon emission 
reduction up through 2030. Just speak to how these efforts the 
Department of Energy has undertaken can leverage even more 
meaningful steps more broadly out there in the country to meet 
the challenge that we have in terms of addressing climate 
change.
    Secretary Moniz. Well, first of all, for that example, I 
mean, efficiency is the number one short payback approach 
typically. We do have, we support the R&D to develop 
technologies, but in this case with appliances, et cetera, it 
is more we put out a well-understood standard cost benefit 
analysis, and our companies are plenty innovative enough to 
meet and beat those standards.
    Mr. Sarbanes. Great. Thank you very much.
    Mr. Whitfield. Gentleman's time is expired.
    Mr. Long is recognized.
    Mr. Long. Thank you, Mr. Chairman.
    And thank you, Mr. Secretary for being here.
    What do you attribute these precipitous drop in gasoline 
prices to? What do you think are the main couple of factors 
that have led to this big drop in gas prices?
    Secretary Moniz. Well, I think the main issue is the 
combination of production, especially U.S. production. U.S. 
production of oil went up 1.6 million barrels per day just last 
year.
    Mr. Long. Due to what?
    Secretary Moniz. Due to the technology that had been 
developed over the years in terms of hydraulic fracturing and 
horizontal drilling, opening up the shale plays, also some deep 
water, but the shale plays mainly. So, we had very, very strong 
production. We have produced an extra several million barrels 
per day at the same time that you have economic softness, for 
example, in Europe and a lot of slowed growth in the Far East 
as well. Supply and demand.
    Mr. Long. Yes. Supply and demand. I mean, to me common 
sense dictates, tells me, but I don't have your knowledge. I am 
not in your position. But when we talk about fracking and 
things, and there was a gentlelady on the other side of the 
aisle that spoke earlier that was very happy that gas prices 
have dropped so precipitously, which we are all thrilled.
    The first time I went home after the big drop I filled up, 
I thought the pump had stopped. It was like $30 short of where 
it used to ring up. And we are all pleased with that. But I 
think that fracking has been very effective in increasing the 
amount of production in this country, and I just wanted to make 
sure that I was on the right wavelength with that.
    You also, and to your credit, pointed out when Mr. Olson 
from Texas was talking about the carbon sequestration plant 
down there, and you corrected him and said it is not running. 
We have had hearings before where they are not running. Do we 
have any that are up and running? And if so, why not? And are 
they going to be viable? Because everyone brags about carbon 
sequestration, which would be a great thing, but I haven't 
found any that are operating. You see these projections of when 
they are going to be on line in 2015 and 2017 and 2019, and 
where are we on that?
    Secretary Moniz. Well, again, there are plants operating. 
There is a natural gas reforming facility in Texas that is 
operating, putting carbon underground. I might add, and again 
in terms of an integrated coal plant, the Boundary Dam plant in 
Canada, is fully operational.
    Mr. Long. The one in Texas that he was referring to----
    Secretary Moniz. The Petra Nova is under construction. It 
will be a few years until it is fully operating. The Kemper 
plant in Mississippi is nearing end of construction. The ADM 
ethanol plant capturing CO2 is nearing completion in 
Illinois. So we have a lot.
    And by the way, we have also had from the Great Plains 
plant in North Dakota--it is a gasification facility--it has 
supplied 20 megatons of CO2 for enhanced oil 
recovery in Canada. So there is a lot of activity going on.
    Mr. Long. So we can look forward to the Keystone being 
complete when we get that down here.
    Thank you.
    Mr. Whitfield. Mr. Engel, you are recognized for 3 minutes.
    Mr. Engel. Thank you, Mr. Chairman.
    Thank you, Mr. Secretary, for waiting. I am going to try to 
condense everything into 3 minutes.
    I want to first be on the record in supporting flex-fuel 
cars. I don't understand why every car built in America isn't 
flex-fuel. I am told you can do it for under $100 a car, and I 
think we should be doing it.
    I want to tell you that I appreciate the President's 
budget. It makes a strong commitment to clean energy. I think 
it is important. Climate change is real. There is already 
enough CO2 in the atmosphere to ensure that the U.S. 
will have more episodes of climate disruption. Superstorm Sandy 
in my district in New York, Hurricane Katrina, snow in Boston 
and Buffalo. We really need to take action.
    I have had many long conversations with Con Edison in New 
York about improvements they can make to better protect their 
critical energy infrastructure. And I know that the Department 
of Energy also made recommendations to industry and governments 
to enhance response preparedness, restoration, and resilience 
to future storms. So can you provide me with an update on DOE's 
efforts to implement its recommendations, including updates on 
the northeast gas reserve? How have communications been 
improved? What has been done to facilitate access to fuel and 
other supplies? And have you identified any existing laws that 
need to be amended or laws that need to be promulgated? That is 
my first question.
    My second question involves Indian Point. I have been 
opposed--I have been for closing Indian Point. It is just north 
of New York City. I am convinced it would never be approved at 
its current location if it were to be built today for a myriad 
of reasons. And your predecessor, Dr. Chu, expressed a need to 
look at whether the Indian Point reactors should remain, and I 
am wondering if you could commit to do the same?
    Secretary Moniz. Well, on the first question, first of all, 
more broadly in terms of emergency response, the northeast 
situation is clearly a major one in terms of climate. I just 
want to note that other examples would include, for example, 
the propane issues last year in the upper Midwest. And in all 
these cases we are--first of all, we are greatly increasing 
through the EIA--the EIA is, by the way, a really important 
agency--our database and our communications with State energy 
offices, so that we have good situational awareness.
    Secondly, the Congress did support in fiscal year 2015 our 
expansion of our emergency response capacity at DOE.
    Thirdly, with regard to the petroleum reserve and the 
product reserve--of course, in the northeast now we have both a 
heating oil and a gasoline reserve, a million barrels each, and 
we are performing fuel resiliency studies for other parts of 
the country as well. That gasoline reserve is fully up and 
operational. And there are 700,000 of the million barrels are 
in the New York Harbor area.
    Mr. Whitfield. The gentleman's time is expired.
    Mr. Engel. Mr. Chairman, just give me 10 seconds.
    Could we communicate on Indian Point? I am not opposed to 
nuclear power at all. I just worry about that power plant.
    Secretary Moniz. Maybe we can have that discussion----
    Mr. Engel. Thank you.
    Mr. Whitfield. At this time I recognize the gentleman from 
Oklahoma for 3 minutes.
    Secretary Moniz. Yes, I need to leave in 3.
    Mr. Whitfield. How much time do you have left, Mr. 
Secretary?
    Secretary Moniz. About 3.
    Mr. Mullin. I will literally have one question for you. 
With the rate that our coal-fired power plants are coming off 
line due to the administration's rules on clean air and the war 
on coal, has there been any study at all to know if the 
capacity of our pipeline right now is going to be able to 
supply adequate supply to our power plants? Obviously, we know 
they are going to have to take up the blunt of the load. And I 
believe we are going to have shortage of electricity heating 
our power grid. What I don't want to see is rolling blackouts.
    Secretary Moniz. Right. So, first of all, I want to just 
emphasize I don't accept the war on coal characterization.
    Mr. Mullin. That wasn't my words. That came out of the 
administration's. I mean, anyway, we can debate that at a 
different time.
    Secretary Moniz. And there are many, many factors that have 
influenced the reduction in coal plants, and by the way, I 
might say nuclear plants as well. I have also----
    Mr. Mullin. I understand that, but we have a lot of plants 
coming off line in 2016.
    Secretary Moniz. So on the gas side there was a paper--we 
will be happy to supply it to you--it was published just days 
ago. It was part of an analytical work in our QER. And what it 
says fundamentally is there will be some need for some regional 
build-out of additional gas pipe, but not nearly as much as is 
being discussed. For one reason, in the last years we have had 
a tremendous build-out of gas pipelines, in fact, enough to 
carry twice as much gas as we actually use.
    Mr. Mullin. But getting it to the power plants. We are 
seeing 4 years it is taking to get a permit, on average, to get 
a line built to the power plants. We have units coming down at 
an alarming rate coming 2016.
    If we are downing these things, then what is DOE's answer 
to the shortage we are going to have in 2 years? Because we 
can't even get the lines permitted in that amount of time.
    Secretary Moniz. OK. Again, I think this is a more detailed 
discussion I would be happy to follow-up on. But to emphasize, 
there has been this huge build-out. Those pipes are 
underutilized. So there is a lot we can do just by using the 
unused capacity of these pipes.
    Mr. Mullin. The volume capacity is set by you guys of how 
much due to highly populated areas and rural areas. But so 
there is going to have to be some fluctuation there. We can 
discuss this at further length, because this is obviously 
vitally important.
    So thank you for your time.
    Secretary Moniz. Yes, it is.
    Mr. Whitfield. Time is expired.
    Mr. Flores, do you have one question you want to ask?
    Mr. Flores. I do. I will just submit mine for the record.
    Mr. Whitfield. OK. Mr. Secretary, thank you. So sorry.
    We appreciate it and we look forward to working with you. 
And thank you so much.
    Secretary Moniz. And we have a number of things to get back 
with, various numbers.
    Mr. Whitfield. That concludes today's hearing. The record 
will remain open for 10 days. And that is the end of the 
hearing.
    [Whereupon, at 4:00 p.m., the subcommittee was adjourned.]
    [Material submitted for inclusion in the record follows:]
    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    

    [Secretary Moniz's answers to submitted questions have been 
retained in committee files and are available at: http://
docs.house.gov/meetings/if/if03/20150211/102942/hhrg-114-if03-
wstate-monize-20150211-sd543.pdf.]

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