Federal Energy Management Program (femp)

Mission/Overview

The Federal Energy Management Program (FEMP) describes its mission as working with “other federal agencies to meet energy-related goals, identify affordable solutions, facilitate public–private partnerships, and provide energy leadership to the country by identifying government best practices.”62 Congress has created a number of energy and energy efficiency requirements and guidelines for federal agencies,63 and FEMP works with those agencies to help them meet their congressionally mandated goals.

Needed Reforms

As the world’s largest single energy consumer, the federal government should use energy efficiently and cost-effectively—especially because the taxpayer is paying the energy bills. The Obama Administration required the federal govern- ment to set extrastatutory and aggressive goals regarding the use of renewable energy. The Trump Administration took a less aggressive approach in Executive Order 13834, which specified that “each agency shall prioritize actions that reduce waste, cut costs, enhance the resilience of Federal infrastructure and operations, and enable more effective accomplishment of its mission.”64

New Policies

A conservative Administration should follow the language of Executive Order 13834 and direct federal agencies to “reduce waste, cut costs, enhance the resilience of Federal infrastructure and operations, and enable more effective accomplish- ment of its mission.” For FEMP, this means focusing on helping federal agencies to follow the law and use energy efficiently and cost-effectively.

Budget

FEMP was funded at $40 million in FY 2022,65 and slightly less than $170 mil- lion is requested for FY 2023.66 If it is focused on helping the federal government to carry out its statutorily based energy goal, much less money is needed. CLEAN ENERGY CORPS

Mission/Overview

Under the IIJA, “the Clean Energy Corps is charged with investing more than $62 billion to deliver a more equitable clean energy future for the American peo- ple[.]”67 The Corps says that it will “focus on deploying next generation clean energy technology” to “help America meet its goals of a carbon-free power sector in 2035 and a decarbonized economy in 2050.”68

Needed Reforms

The Clean Energy Corps is a taxpayer-funded program to create new govern- ment jobs for employees “who will work together to research, develop, demonstrate, and deploy solutions to climate change.” DOE anticipates recruiting “an additional 1,000 employees using a special hiring authority included in the Bipartisan Infra- structure Law.”69 Taxpayers should not have to fund a cadre of federal employees to promote a partisan political agenda.

New Policies

Eliminate the Clean Energy Corps by revoking funding and eliminating all posi- tions and personnel hired under the program.

Budget

Funding for Clean Energy Corps employees is not clearly defined in the FY 2023 DOE budget request.

ENERGY INFORMATION ADMINISTRATION (EIA)

Mission/Overview

The U.S. Energy Information Administration “collects, analyzes, and dis- seminates independent and impartial energy information to promote sound policymaking, efficient markets, and public understanding of energy and its inter- action with the economy and the environment.”70

Needed Reforms

EIA is not an inherently problematic agency and historically has provided inde- pendent and impartial analysis. Requests for EIA analyses can be made by the Administration or from Members of Congress or congressional committees. EIA needs to be committed to providing unbiased forecasting and data so that poli- cymakers, industry, and the public can have a clear understanding of our energy resources and energy economy. Strong leadership will be needed to ensure that data and reporting are not misused to promote a politicized “energy transition.”

New Policies

Revise reserve margins. EIA, in conjunction with FERC, NERC, regional transmission organizations (RTOs), and the electric industry, should change how electric grid reserve margins are defined and calculated. In the past, reserve margins have looked at the amount of nameplate capacity on the grid to serve peak load plus a reserve. With the increasing number of intermittent, nondispatchable resources like wind and solar, peak load and reserve margins need to be reevaluated. Reserve margins need to be timed to load changes throughout the day and consider the availability of dispatchable on-demand resources to meet load when renewables may not be available.

Clarify levelized cost of electricity. “Levelized cost of electricity (LCOE) refers to the estimated revenue required to build and operate a generator over a specified cost recovery period.”71 It is used in the National Energy Modeling System (NEMS) to compare the cost of technologies to determine which technologies are expected to be constructed in the future. Although it is useful in comparing the costs of resources over time, LCOE can also mask the massive amounts of capital needed to deploy new generation. Moreover, in the case of intermittent resources such as wind and solar, LCOE does not include the cost for backup or firming power from dispatchable resources. EIA should ensure that its reporting provides an accurate assessment of generation costs. The cost of backup power for when wind and solar resources are not available should be included when comparing the technologies and reported as a separate component in the modeling documents.

Update reports on the impacts of federal financial interventions and subsidies. EIA’s most recent report on federal financial interventions and subsidies was issued in April 2018.72 This is an important analysis because it clearly shows the level of the federal government’s intervention in each area of the energy system for a given fiscal year. In the past, EIA performed the analysis pursuant to a request from Congress or the Administration. This report should become a project that is performed annually or every other year as part of EIA’s base program.

Ensure the objectivity of the International Energy Outlook (IEO). In the past, EIA published the IEO every year. It is now published every two years. IEO forecasts are important because the International Energy Agency’s forecasts in its annual World Energy Outlook are becoming unrealistic and politically oriented to push Europe’s climate goals. EIA forecasts should be based on current laws and regulations and should not be used to promote favored policies.

Assess the case for privatization. There are some who think that EIA should be privatized. The cost savings to taxpayers should be considered. On the other hand, EIA has generally demonstrated neutral data presentation that is helpful to policymakers and the private sector.

Budget

Congress appropriated $126.8 million for EIA in FY 2021, and the FY 2023 budget request is for approximately $144.5 million.73

OFFICE OF INTERNATIONAL AFFAIRS (IA)

Mission/Overview

“The Office of International Affairs has primary responsibility for addressing international energy issues that have a direct impact on research, development, utilization, supply, and conservation of energy affecting the United States.”74 It “focuses on enhancing global energy security through countering malign influence, diversifying supplies, and increasing energy access” and “is committed to increas- ing U.S. energy exports and trade to enhance growth.” 75

Needed Reforms

Expand IA’s role and focus its activities on U.S. international energy security interests. International energy activities should be consolidated under IA (and the Department of State’s Bureau of Energy Resources should be eliminated) to ensure a proper understanding of domestic energy — 388 —Department of Energy and Related Commissions policy and how it affects foreign policy, as well as the international energy landscape and how it affects U.S. national and economic security.

Develop a strategy for identifying and accessing resources and advancing U.S. economic interests. America has recently become a net energy exporter, but it still imports large amounts of essential energy resources such as oil and natural gas as well as such materials as uranium (including yellowcake), lithium, certain rare earth minerals, and energy generation and transmission components and technology. The United States needs a clear understanding of its global energy and economic interests and a strategy for protecting them.

Oppose “climate reparations.” During the November 2022 United Nations climate conference in Egypt, the Biden Administration and other “developed” countries agreed to provide “climate reparations” to developing countries for the harm allegedly caused by the developed countries’ use of fossil fuel.76 A reparations slush fund administered by a non-U.S. organization provides no assurance that U.S. interests will be protected and should not be supported in any form.

New Policies

Identify U.S. energy security interests and promote American energy dominance. To this end, IA should work closely with the DESAS Office of Policy on the National Energy Security Strategy.

Strengthen the new DESAS vis-à-vis the Department of State. The State Department’s Bureau of Energy Resources has generally excluded IA from serious discussions of international affairs to the detriment of DOE and broader interagency policy development. In addition, DOE embassy representatives are generally excluded from giving policy advice to senior diplomats and are used merely as sources of information instead of being active advocates for the Secretary’s priorities. The Secretary of Energy is a senior member of the President’s National Security Council and should function as such. The DOE’s Deputy Secretaries, Under Secretaries, and Assistant Secretaries should be guaranteed representation at all Deputies and Policy Coordination Committee meetings. In addition, senior political and career staff should hold positions on the NSC staff equivalent to their counterparts at State, Defense, Treasury, and the Intelligence Community (IC). DESAS billets should replace State Department Bureau of Energy Resources billets at the relevant posts worldwide.

Stop “climate reparations.” The President should refuse to provide climate reparations under an unratified treaty, and IA should encourage other countries to reconsider their desire to provide reparations.

ARCTIC ENERGY OFFICE (AE)

Mission/Overview

AE was established during the Trump Administration to create a central office overseeing U.S. Arctic interests in Alaska and the other Arctic nations in response to the growing strategic sensitivity of this geographic region and the natural resources it contains. It “serves as the principal advisor to the Under Secretary on all domestic Arctic issues, including energy, science, and national security.”77

Needed Reforms

In October 2022, the Biden Administration released its National Strategy for the Arctic Region.78 Although recognizing national security threats in the Arctic, it also focuses heavily on climate change, sustainability, and international cooperation. The United States must establish a strategic plan to promote its national security, energy, and economic interests in the Arctic. An analysis and plan to support the responsible development of Alaska’s energy assets should be a priority.

New Policies

Defend American interests in the Arctic Circle. The next Administration needs to define American strategic and economic interests in the Arctic Circle. AE should help to identify those interests, as well as threats posed by countries like Russia and China, and develop appropriate policy options for the President’s consideration.

Ensure that AE is clearly focused. In particular, this means identifying U.S. energy interests in the Arctic Circle, identifying foreign government and commercial interests and activity in the region, and ensuring that the United States does not forgo important energy and national security interests in the Arctic.

Expand AE’s operations in Alaska. AE’s operations in Alaska should be expanded to encompass broader national energy security interests in the region including rare earths, oil, and natural gas. AE should also be the lead for DOE Antarctic operations as a counter to growing Russian and Chinese interest in Antarctic resources.

Personnel

AE should provide a senior Arctic Energy official to the U.S. Arctic Council del- egation in recognition of the key role that energy plays in Arctic development.