OFFICE OF FOSSIL ENERGY AND CARBON MANAGEMENT (FECM)

Mission/Overview

DOE is authorized by law to increase the conversion efficiency of all forms of fossil energy, reduce costs, improve environmental performance, and increase the energy security of the United States.33 In recent years, the Office of Fossil Energy (FE) has been transformed from its statutory role of improving fossil energy pro- duction to one that is focused primarily on reducing the carbon dioxide emissions from fossil fuel extraction, transport, and combustion. This change is reflected in the office’s new name, the Office of Fossil Energy and Carbon Management (FECM), effective as of July 2021, and FECM’s mission: “to minimize the environmental impacts of fossil fuels while working towards net-zero emissions.”34

Needed Reforms

Eliminate carbon capture utilization and storage (CCUS) programs. Despite the recent expansion of the 45Q tax credit for carbon capture utilization and storage (CCUS) to $87 per ton, most carbon capture technology remains economically unviable, although private-sector innovations are on the horizon. CCUS programs should be left to the private sector to develop.35 If the office continues any CCUS research, that research should be focused more on innovative utilization.

Pursue the processing of critical minerals. Development of domestic critical material sources is important for national security, as the vast majority of critical materials are mined or processed (or both) in Russia and China.36 The processing of critical materials from fossil fuel waste products (primarily coal) has shown some potential and, in view of our vast domestic reserves of coal and abundant waste from coal mining and combustion, should be pursued.

New Policies

Rename FECM (if it cannot be eliminated) under its original designation as the Office of Fossil Energy and with its original mission: increasing energy security and supply through fossil fuels. Focus on energy security and supply. Absent elimination of FECM, Congress should direct FECM appropriations toward increasing energy security and supply. Congress has already directed these goals (including the reduction of costs).37

Ensure that LNG export approvals are reviewed and processed in a timely manner. In particular:

1. Ensure that LNG export applications are reviewed and approved expeditiously.
2. Maintain the categorical exclusion from the National Environmental Policy Act (NEPA)38 for LNG exports that was established by the Trump Administration39 or (if it is revoked by the Biden Administration) reinstate it.
3. Work with Congress to expand automatic approvals to include allies such as NATO as well as nations that have free trade agreements with the U.S. l Strategic Petroleum Reserve (SPR). The Biden Administration moved responsibility for the SPR to CESER. Regardless of where the responsibility lies, the new DESAS should ensure that the SPR is maintained for national strategic purposes and not misused for political gain.

Eliminate FECM. The next Administration should work with Congress to eliminate all of DOE’s applied energy programs, including those in FECM (with the possible exception of those that are related to basic science for new energy technology). Taxpayer dollars should not be used to subsidize preferred businesses and energy resources, thereby distorting the market and undermining energy reliability.

Budget

The FY 2023 budget request for FECM was approximately $893.2 million.40 FECM’s requested appropriation can be compared to the more than $4.0 billion requested for the Office of Energy Efficiency and Renewable Energy.41 The disparity in funding demonstrates how DOE’s research activities and substantial portions of its organizational structure are now focused entirely on the reduction of CO2 emissions rather than energy access or energy security.

OFFICE OF ENERGY EFFICIENCY AND RENEWABLE ENERGY (EERE)

Mission/Overview

The Office of Energy Efficiency and Renewable Energy traces its roots to the Energy Policy and Conservation Act of 1975,42 but most of its programs today are rooted in the Energy Policy Act of 2005.43 Under the Biden Administration, EERE’s mission is “to accelerate the research, development, demonstration, and deployment of technologies and solutions to equitably transition America to net- zero greenhouse gas (GHG) emissions economy-wide by no later than 2050” and “ensure [that] the clean energy economy benefits all Americans.”44 The office is made up of three “pillars”: energy efficiency, renewable energy, and sustainable transportation.

Needed Reforms

End the focus on climate change and green subsidies. Under the Biden Administration, EERE is a conduit for taxpayer dollars to fund progressive policies, including decarbonization of the economy and renewable resources. EERE has focused on reducing carbon dioxide emissions to the exclusion of other statutorily defined requirements such as energy security and cost. For example, EERE’s five programmatic priorities during the Biden Administration are all focused on decarbonization of the electricity sector, the industrial sector, transportation, buildings, and the agricultural sector.45

Eliminate energy efficiency standards for appliances. Pursuant to the Energy Policy and Conservation Act of 1975 as amended, the agency is required to set and periodically tighten energy and/or water efficiency standards for nearly all kinds of commercial and household appliances, including air conditioners, furnaces, water heaters, stoves, clothes washers and dryers, refrigerators, dishwashers, light bulbs, and showerheads. Current law and regulations reduce consumer choice, drive up costs for consumer appliances, and emphasize energy efficiency to the exclusion of other important factors such as cycle time and reparability.

New Policies

Reduce EERE funding. If EERE cannot be eliminated, then the Administration should engage with Congress and the House and Senate Appropriations Committees on EERE’s budget. EERE’s budget was around $1.5 billion a year when the advances were made that led to dramatic cost decreases in wind, solar, and battery technology. In recent years, Congress has appropriated many billions of dollars in excess of EERE’s normal budget (DOE requested more than $4.0 billion for FY 2023).46 It should rescind these excess monies so that DOE is not required to spend them. If funding cannot be reduced, then it should be reallocated to more fundamental research and less toward commercialization and deployment.

Focus on fundamental science and research. If EERE cannot be eliminated, then the Administration should focus on broader and more fundamental energy research, consistent with law. The Biden Administration is too focused on deploying technologies instead of relying on the private sector. Moreover, under the Biden Administration, EERE is too focused on decarbonization and not at all on the cost of energy.

Eliminate energy efficiency standards for appliances. The next Administration should work with Congress to modify or repeal the law mandating energy efficiency standards. Before (or in lieu of ) repealing the law, there are steps the agency can take to refocus on the consumer by giving full force to the provisions already in the law that serve to limit regulatory overreach and protect against excessively stringent standards. For example, the Trump DOE prioritized the relatively few appliance regulations that were likely to save consumers the most energy and refrained from those whose modest benefits are unlikely to justify the costs. It also took steps to ensure that any new standards do not compromise product quality or eliminate any features. These and other consumer protections are in the statute but have often been ignored.

Eliminate EERE. The next Administration should work with Congress to eliminate all of DOE’s applied energy programs, including those in EERE (with the possible exception of those that are related to basic science for new energy technology). Taxpayer dollars should not be used to subsidize preferred businesses and energy resources, thereby distorting the market and undermining energy reliability.

Budget

EERE was funded at slightly more than $2.8 billion in FY 2021, and DOE requested slightly more than $4.0 billion for FY 2023.47 Congress needs to rescind the appropriated monies that EERE has not spent and begin fresh with new appropriations.

GRID DEPLOYMENT OFFICE (GDO)

Mission/Overview

The Grid Deployment Office was established to implement parts of the Infra- structure Investment and Jobs Act. Pursuant to the IIJA, GDO administers funds appropriated by Congress to support transmission expansion and low/zero carbon resources. In addition, GDO is developing studies of the electric grid to address congestion, enhance reliability and resilience, and promote “clean” energy.48

Needed Reforms

End grid planning and focus instead on reliability. FERC and NERC have the primary responsibility for addressing reliability, states have the primary authority to site and permit transmission lines, and regional transmission organizations assist in planning regional transmission needs for parts of the country, but Congress granted some grid planning and siting authority to FERC and DOE through the Energy Policy Act of 2005 and IIJA, as well as grid funding through the Inflation Reduction Act.

Instead of focusing on grid expansion for the benefit of renewable resources or supporting low/carbon generation, GDO should be incorporated into the reformed Office of Cybersecurity, Energy Security, and Emergency Response, which would work to enhance the grid’s reliability and resilience. To the extent that they remain in effect, the funding programs that GDO oversees and administers should emphasize grid reliability, not renewables expansion. Consider whether to defund the civil nuclear tax credit program and hydroelectric power efficiency and production incentives established in the IIJA and administered through GDO. If subsidies for renewable resources are not repealed, it may be necessary to continue subsidies for nuclear and hydro to ensure grid reliability.

New Policies

Eliminate GDO and assign necessary activities to the reformed CESER. It appears that GDO’s current purpose is to promote the integration of low/zero carbon resources onto the grid by supporting subsidies for such resources and building new transmission facilities at — 380 —Department of Energy and Related Commissions a cost that poses a barrier to renewable generation expansion. However, some of the grants that it administers under the IIJA appear to be properly focused on enhancing the reliability and security of the electric grid. They should be reassigned to the reformed and expanded CESER.

End DOE/GDO’s role in grid planning for the benefit of renewable developers. Under the Energy Policy Act of 2005 and IIJA, DOE is to perform grid congestion studies and has authority to identify National Interest Electric Transmission Corridors (NIETC). Under the Biden Administration, GDO is working on a National Transmission Planning Study and is administering $2.5 billion to support “nationally significant transmission lines, increase resilience by connecting regions of the country, and improve access to cheaper clean energy sources.”49

Defund most GDO programs. GDO oversees nearly $20 billion in new appropriations created by the IIJA, including a grid modernization grant program, the transmission facilitation program, and the civil nuclear credit program, among others. Congress should rescind any money not already spent.

Budget

Congress appropriated $10 million for GDO in FY 2021, and DOE has requested $90.2 million for FY 2023.50