Legislative Hearing to Strengthen Energy Infrastructure, Efficiency, and Financing, House hearing transcript (June 22, 2022), GovInfo CHRG-117hhrg61992, PDF
Summary
This is the Government Publishing Office PDF of the “Legislative Hearing to Strengthen Energy Infrastructure, Efficiency, and Financing,” a hybrid hearing on Wednesday, June 22, 2022 before the Subcommittee on Energy of the House Committee on Energy and Commerce (Serial No. 117–89). Witnesses were Richard Frias of the Native American Finance Officers Association, Andrew DeLaski of the Appliance Standards Awareness Project, Dustin Mulvaney of San Jose State University, Joshua C. Greene of A.O. Smith Corporation, Lucian Pugliaresi of the Energy Policy Research Foundation and Ben Lieberman of the Competitive Enterprise Institute. The bills discussed included H.R. 1599, H.R. 5292, H.R. 7947 and H.R. 8053.
Summary drafted by a model from the document's text below and checked by script against that text before publication. It is a navigation aid, not a reading of what the document proves. Where AI is used
Full text
LEGISLATIVE HEARING TO STRENGTHEN ENERGY
INFRASTRUCTURE, EFFICIENCY, AND FINANCING
HYBRID HEARING
BEFORE THE
SUBCOMMITTEE ON ENERGY
OF THE
COMMITTEE ON ENERGY AND
COMMERCE
HOUSE OF REPRESENTATIVES
ONE HUNDRED SEVENTEENTH CONGRESS
SECOND SESSION
JUNE 22, 2022
Serial No. 117–89
(
Published for the use of the Committee on Energy and Commerce
govinfo.gov/committee/house-energy
energycommerce.house.gov
U.S. GOVERNMENT PUBLISHING OFFICE
61–992 PDF WASHINGTON : 2026
COMMITTEE ON ENERGY AND COMMERCE
FRANK PALLONE, JR., New Jersey
Chairman
BOBBY L. RUSH, Illinois CATHY MCMORRIS RODGERS, Washington
ANNA G. ESHOO, California Ranking Member
DIANA DEGETTE, Colorado FRED UPTON, Michigan
MIKE DOYLE, Pennsylvania MICHAEL C. BURGESS, Texas
JAN SCHAKOWSKY, Illinois STEVE SCALISE, Louisiana
G. K. BUTTERFIELD, North Carolina ROBERT E. LATTA, Ohio
DORIS O. MATSUI, California BRETT GUTHRIE, Kentucky
KATHY CASTOR, Florida DAVID B. MCKINLEY, West Virginia
JOHN P. SARBANES, Maryland ADAM KINZINGER, Illinois
JERRY MCNERNEY, California H. MORGAN GRIFFITH, Virginia
PETER WELCH, Vermont GUS M. BILIRAKIS, Florida
PAUL TONKO, New York BILL JOHNSON, Ohio
YVETTE D. CLARKE, New York BILLY LONG, Missouri
KURT SCHRADER, Oregon LARRY BUCSHON, Indiana
TONY CÁRDENAS, California MARKWAYNE MULLIN, Oklahoma
RAUL RUIZ, California RICHARD HUDSON, North Carolina
SCOTT H. PETERS, California TIM WALBERG, Michigan
DEBBIE DINGELL, Michigan EARL L. ‘‘BUDDY’’ CARTER, Georgia
MARC A. VEASEY, Texas JEFF DUNCAN, South Carolina
ANN M. KUSTER, New Hampshire GARY J. PALMER, Alabama
ROBIN L. KELLY, Illinois, Vice Chair NEAL P. DUNN, Florida
NANETTE DIAZ BARRAGÁN, California JOHN R. CURTIS, Utah
A. DONALD MCEACHIN, Virginia DEBBIE LESKO, Arizona
LISA BLUNT ROCHESTER, Delaware GREG PENCE, Indiana
DARREN SOTO, Florida DAN CRENSHAW, Texas
TOM O’HALLERAN, Arizona JOHN JOYCE, Pennsylvania
KATHLEEN M. RICE, New York KELLY ARMSTRONG, North Dakota
ANGIE CRAIG, Minnesota
KIM SCHRIER, Washington
LORI TRAHAN, Massachusetts
LIZZIE FLETCHER, Texas
PROFESSIONAL STAFF
TIFFANY GUARASCIO, Staff Director
WAVERLY GORDON, Deputy Staff Director
NATE HODSON, Minority Staff Director
(II)
SUBCOMMITTEE ON ENERGY
BOBBY L. RUSH, Illinois
Chairman
SCOTT H. PETERS, California FRED UPTON, Michigan
MIKE DOYLE, Pennsylvania Ranking Member
JERRY MCNERNEY, California, Vice Chair MICHAEL C. BURGESS, Texas
PAUL TONKO, New York ROBERT E. LATTA, Ohio
MARC A. VEASEY, Texas DAVID B. MCKINLEY, West Virginia
KIM SCHRIER, Washington ADAM KINZINGER, Illinois
DIANA DEGETTE, Colorado H. MORGAN GRIFFITH, Virginia
G. K. BUTTERFIELD, North Carolina BILL JOHNSON, Ohio
DORIS O. MATSUI, California LARRY BUCSHON, Indiana
KATHY CASTOR, Florida TIM WALBERG, Michigan
PETER WELCH, Vermont JEFF DUNCAN, South Carolina
KURT SCHRADER, Oregon GARY J. PALMER, Alabama
ANN M. KUSTER, New Hampshire DEBBIE LESKO, Arizona
NANETTE DIAZ BARRAGÁN, California GREG PENCE, Indiana
A. DONALD MCEACHIN, Virginia KELLY ARMSTRONG, North Dakota
LISA BLUNT ROCHESTER, Delaware CATHY MCMORRIS RODGERS, Washington
TOM O’HALLERAN, Arizona (ex officio)
FRANK PALLONE, JR., New Jersey (ex
officio)
(III)
C O N T E N T S
Page
Hon. Jerry McNerney, a Representative in Congress from the State of Cali-
fornia, opening statement .................................................................................... 2
Prepared statement .......................................................................................... 5
Hon. Fred Upton, a Representative in Congress from the State of Michigan,
opening statement ................................................................................................ 7
Prepared statement .......................................................................................... 9
Hon. Frank Pallone, Jr., a Representative in Congress from the State of
New Jersey, opening statement .......................................................................... 13
Prepared statement .......................................................................................... 15
Hon. Cathy McMorris Rodgers, a Representative in Congress from the State
of Washington, opening statement ..................................................................... 17
Prepared statement .......................................................................................... 19
WITNESSES
Richard Frias, Executive Director, Native American Finance Officers Associa-
tion ........................................................................................................................ 25
Prepared statement .......................................................................................... 27
Andrew DeLaski, Executive Director, Appliance Standards Awareness Project 30
Prepared statement .......................................................................................... 33
Dustin Mulvaney, Ph.D., Professor, Environmental Studies, San Joe State
University ............................................................................................................. 43
Prepared statement .......................................................................................... 45
Joshua C. Greene, Esq., Corporate Vice President, Government and Industry
Affairs, A.O. Smith Corporation ......................................................................... 48
Prepared statement .......................................................................................... 50
Answer to submitted questions ....................................................................... 135
Lucian Pugliaresi, President, Energy Policy Research Foundation, Inc. ............ 54
Prepared statement .......................................................................................... 56
Ben Lieberman, Senior Fellow, Energy and Environment Competitive Enter-
prise Institute ....................................................................................................... 72
Prepared statement .......................................................................................... 74
Answer to submitted questions ....................................................................... 140
SUBMITTED MATERIAL
H.R. 1599, the Securing America’s Critical Minerals Supply Act 1
H.R. 5292, the Energy Accountability Act 1
H.R. 7947, the Weatherization Enhancement and Readiness Act of 2022 1
H.R. 7962, To amend the Energy Policy and Conservation Act to modify
the definition of water heater under energy conservation standards, and
for other purposes 1
H.R. 8053, the Guaranteeing Resilient Installations for Defense Act 1
H.R. 8068, the Tribal Energy Investment Act of 2022 1
Letter of June 21, 2022, by Stephen R. Yurek, et al., the Air-Conditioning,
Heating, and Refrigeration Institute, to Joe Manchin, et al., submitted
by Mr. McNerney ................................................................................................. 119
Letter of June 21, 2022, from David Bradley, CEO, National Community
Action Foundation, to Mr. Rush and Mr. Upton, submitted by Mr. McNer-
ney ......................................................................................................................... 122
1 The legislation has been retained in committee files and is available at
https://docs.house.gov/Committee/Calendar/ByEvent.aspx?EventID=114932.
(V)
VI
Page
Letter of June 22, 2022, from Dr. Ali Nouri, Assistant Secretary for Congres-
sional and Intergovernmental Affairs, U.S. Department of Energy, to Mr.
Rush and Mr. Upton, submitted by Mr. McNerney .......................................... 126
Letter of June 22, 2022, from Rich Nolan, National Mining Association,
to Mr. Pallone, et al., submitted by Mr. McNerney .......................................... 130
Letter of October 14, 2021, from Rep. Don Young, to Ms. Pelosi and Mr.
McCarthy, submitted by Mr. Upton ................................................................... 132
Letter of June 21, 2022, from Joint Associations, to Mr. Rush and Mr. Upton,
submitted by Mr. McNerney ............................................................................... 133
LEGISLATIVE HEARING TO STRENGTHEN EN-
ERGY INFRASTRUCTURE, EFFICIENCY, AND
FINANCING
WEDNESDAY, JUNE 22, 2022
HOUSE OF REPRESENTATIVES,
SUBCOMMITTEE ON ENERGY,
COMMITTEE ON ENERGY AND COMMERCE,
Washington, DC.
The subcommittee met, pursuant to notice, at 10:33 a.m. in the
John D. Dingell Room, 2123 Rayburn House Office Building, and
remotely via Cisco Webex online video conferencing, Hon. Jerry
McNerney (member of the subcommittee), presiding.
Present: Representatives McNerney, Peters, Doyle, Tonko,
Schrier, Matsui, Castor, Welch, Schrader, Kuster, Barragán,
McEachin, Blunt Rochester, O’Halleran, Pallone (ex officio); Upton,
Burgess (subcommittee ranking member), Latta, McKinley, Grif-
fith, Johnson, Bucshon, Walberg, Duncan, Palmer, Lesko, Pence,
and Rodgers (ex officio).
Staff present: Waverly Gordon, Deputy Staff Director and Gen-
eral Counsel; Jessica Grandberry, Staff Assistant; Tiffany
Guarascio, Staff Director; Perry Hamilton, Clerk; Zach Kahan,
Deputy Director Outreach and Member Service; Rick Kessler, Sen-
ior Advisor and Staff Director, Energy and Environment; Mac-
kenzie Kuhl, Digital Assistant; Tyler O’Connor, Energy Counsel;
Lino Pena-Martinez, Policy Analyst; Kaitlyn Peel, Digital Director;
Kris Pittard, Policy Coordinator; Medha Surampudy, Professional
Staff Member; Caroline Wood, Research Assistant; Tuley Wright,
Senior Energy and Environment Policy Advisor; Sarah Burke, Mi-
nority Deputy Staff Director; Nate Hodson, Minority Staff Director;
Noah Jackson, Minority Staff Assistant; Peter Kielty, Minority
General Counsel; Emily King, Minority Member Services Director;
Bijan Koohmaraie, Minority Chief Counsel, Oversight and Inves-
tigations Chief Counsel; Tim Kurth, Minority Chief Counsel, CPC;
Mary Martin, Minority Chief Counsel, Energy and Environment;
Brandon Mooney, Minority Deputy Chief Counsel for Energy; Clare
Paoletta, Minority Policy Analyst, Health; Peter Spencer, Minority
Senior Professional Staff Member, Energy; and Michael Taggart,
Minority Policy Director.
Mr. MCNERNEY [presiding]. will now come to order.
Today’s subcommittee is holding hearing entitled, ‘‘Legislative
Hearing to Strengthen Energy Infrastructure, Efficiency, and Fi-
nancing.’’
(1)
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Due to the COVID–19 public health emergency, members can
participate in today’s hearing either in person or remotely, via on-
line video conferencing.
In accordance with the updated guidance issued by the attending
physician, members, staff, and members of the press present in the
hearing room are not required to wear a mask.
For members participating remotely, your microphones will be
set on mute for the purpose of eliminated—eliminating inadvertent
background noise. Members participating remotely will need to
unmute your microphone each time you wish to speak. Please note
that, once you unmute your microphone, anything that is in Webex
will be heard over the loudspeakers in the committee room, and
subject to being heard by livestream and C-SPAN.
Given that members are participating from different locations at
today’s hearing, all recognition of members, such as for questions,
will be in the order of subcommittee seniority.
Documents for the record can be sent to Lino Pena-Martinez at
the email address we provided to staff. All documents will be en-
tered into the record at conclusion of the hearing.
The Chair now recognizes himself for an opening statement.
STATEMENT OF HON. JERRY MCNERNEY, A REPRESENTATIVE
IN CONGRESS FROM THE STATE OF CALIFORNIA
I would like to welcome our witnesses for today’s hearing: An-
drew DeLaski, executive director of Appliance Standards Aware-
ness Project; Richard Rico Frias, pronounced—executive director,
Native American Finance Officers Association—thank you for com-
ing; Dustin Mulvaney, Ph.D., professor, environmental studies, San
Jose State University; Joshua C. Greene, corporate vice president,
government and industry affairs, A.O. Smith Corporation; Lucian
Pugliaresi, president, Energy Policy Research Foundation; Ben Lie-
berman, senior fellow, Competitive Enterprise Institute.
Thank you for joining us today. We look forward to your testi-
mony.
OK, now for my opening statement.
Good morning. Today we will be holding a legislative hearing on
six bills authored by members from both sides of the aisle focused
on updates and upgrades to our Nation’s energy infrastructure.
As the U.S. and the rest of the world undergoes the energy tran-
sition necessary to avoid the worst impacts of climate change, it is
crucial that our existing system be able to adapt to meeting our
evolving needs. The six bills present modest changes to Federal
programs to make operations smoother and better able to meet the
needs of energy consumers and developers.
Two of today’s bills focus on increasing energy efficiency of homes
and appliances, which will be essential for decreasing our energy
demand and lowering energy—monthly energy costs for Americans.
Another two of the bills make reforms to the way Federal Gov-
ernment finances energy infrastructure, which would improve ac-
cessibility and accountability of Federal loan programs.
And two of the bills address the reliability of our energy systems,
which continues to be imperiled by climate disasters, supply chain
issues, cyber and physical vulnerabilities, and aging assets.
3
These bills represent a common-sense approach to reforming our
energy laws, and I look forward to hearing what our witnesses
have to say about them.
First up is H.R. 1599, Securing America’s Critical Minerals Sup-
ply Act, authored by our ranking member, Mr. Upton. Critical min-
erals are essential to the growth of renewable energy resources,
and onshoring the supply chain will both increase the availability
of components and support domestic jobs. This bill draws attention
to that need as energy transition evolves.
We will also discuss H.R. 8053, a bipartisan bill from Congress-
men Crow, Peters, and Bacon. This bill allows the Department of
Energy to enter into contracts or agreements to improve our resil-
ience of portions of our electrical infrastructure that are critical to
our national defense, and to reduce the vulnerability of this infra-
structure. In my opinion, this should be a non-controversial bill
which will allow us to enhance our national security by making
long-term commitments to energy reliability, serving our military
installations without over-burdening nearby tax ratepayers.
Next up we have two bills focused on energy efficiency. H.R. 7947
from the Environment and Climate Change Subcommittee’s Chair-
man Paul Tonko; this subcommittee’s chairman, Bobby Rush; and
the chairwoman of the Energy and Water Appropriations Sub-
committee, Marcy Kaptur; and H.R. 7962, offered by Congress-
woman Debbie Dingell.
Mr. Tonko’s Weatherization Enhancement and Readiness Act
would strengthen the Weatherization assistance program by rais-
ing the cap that limits how much assistance households can receive
to account for increasing in the prices of building materials, and by
ensuring that the households that could most benefit from Weath-
erization programs are able to participate. This program has pro-
vided important services for our low-income households for decades,
and the proposed changes can assure that the program continues
to be accessible for years to come.
Mrs. Dingell’s bipartisan bill touches on the water energy nexus
by harmonizing energy efficiency standards for commercial and res-
idential water heaters by improving the resilience of our grid, by
creating a demand response program for residential water heaters.
It would also require the Department of Energy to issue a rule by
the end of 2024 requiring that electric water heaters have demand
response capabilities as long as that requirement is technologically
feasible and economically justified. In considering this bill, I hope
that we take note of one of the many ways in which energy and
water are intertwined, and how energy use is embedded in the
water-related appliances in our homes.
These bills are two great ideas that will help reduce the strain
on our grid, while delivering electricity to our homes and appli-
ances.
Finally, we have two bills that would make common-sense
tweaks to our loan program office within the Department of En-
ergy.
The first is the bill from our late colleague, Don Young of Alaska,
H.R. 5292, the Energy Accountability Act. If enacted, it would man-
date that any borrower that has previously defaulted on a Title 17
4
loan be barred from receiving any other loan guarantees under the
program.
Second, H.R. 8068, a bipartisan bill from Ms. Leger Fernandez
and this subcommittee’s own Mr. O’Halleran, improves the Tribal
Energy Loan Guarantee Program by allowing the Department of
Energy to issue loans directly revitalizing a program that has not
been able to issue a single loan in 17 years.
I want to thank the authors of the bills we are discussing today
and their staffs for their hard work and the hard work yet to come.
This is the start of a journey on these bills, not the end, and I look
forward to the feedback that our witnesses are able to provide
today.
[The prepared statement of Mr. McNerney follows:]
5
PREPARED STATEMENT OF HON. JERRY MCNERNEY
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7
Mr. MCNERNEY. I have a letter here from Dr. Ali Nouri, assistant
secretary of congressional intergovernmental affairs of the Depart-
ment of Energy. I request unanimous consent to enter the following
letter from the Department of Energy into the record.
Without objection, so ordered.
[The information appears at the conclusion of the hearing.]
Mr. MCNERNEY. And with that I yield to the ranking member,
Mr. Upton, for a 5-minute opening statement.
STATEMENT OF THE HON. FRED UPTON, A REPRESENTATIVE
IN CONGRESS FROM THE STATE OF MICHIGAN
Mr. UPTON. Well, thank you, my friend, Mr. Chairman, and
thanks to our witnesses for appearing before us to provide their
testimony.
Mr. Pallone, the U.S. is plunging deeper and deeper into an en-
ergy crisis driven by roaring inflation, anti-fossil fuel policies, de-
mand shocks across the country.
Our constituents are rightly concerned about the lack of leader-
ship. The annual inflation rate in May, as we know, was 8.6 per-
cent, the highest level since 1981. Gasoline is averaging five bucks,
with drivers in California and other states paying over six, getting
close to seven. More than half of the Nation is going to be at ele-
vated risk for power outages this summer, even perhaps this week-
end, as reliable baseload power generation is retired in favor of
weather-dependent green alternatives like wind and solar. God
help us when the wind doesn’t blow and the sun doesn’t shine.
The bills before us today are not going to alleviate the pain that
Americans are feeling at the pump or reduce the risk of blackouts.
And while this is supposed to be a legislative hearing, the DoE is
not here to provide their testimony.
Republicans on this side of the aisle have been sounding the
alarm since day one. Energy prices surged following the President’s
cancellation of Keystone XL pipeline on day one and the morato-
rium on Federal leasing. Gas prices went up even further, as the
EPA and FERC began to tighten the screws on infrastructure per-
mitting.
But instead of addressing the energy crisis head on, the Presi-
dent is traveling to Saudi Arabia to ask OPEC and Russia for more
oil. Members of this committee should hear from energy producers
on what it will take to produce more oil here at home.
I am concerned by what appears to be a naive understanding of
the scope and scale of the energy crisis and what is required to ad-
dress it; contrary to the rhetoric from the White House and DoE,
high gas prices will not encourage Americans to buy more expen-
sive electric vehicles.
Residential electricity prices are also increasing at record pace,
and China is consolidating its control over more than 90 percent
of critical minerals used in batteries and solar panels. If we don’t
reinvigorate our domestic mining industry, we are going to see
more spikes in raw materials like lithium that is going to drive up
costs even more for consumers.
I was pleased to see my bill, H.R. 1599, Securing America’s Crit-
ical Minerals Supply Act, included in today’s legislative hearing.
This bill is going to build on DoE’s energy security mission by pro-
8
viding tools for DoE to secure a reliable domestic supply of critical
energy resources, including critical materials. We can’t trade away
the energy security America has achieved through the domestic
production of coal, oil, or natural gas for Chinese batteries and
solar panels. It is a national security imperative that we produce
the energy that we need right here at home. It is really simple.
Turning to the other bills on the docket, I am supportive, cer-
tainly, of H.R. 5292, the Energy Accountable—Accountability Act,
introduced by our best buddy, Don Young of Alaska. The legislation
is a good government bill that will disqualify companies like
Solyndra, who defaulted on a loan, from participating in DoE’s loan
guarantee program. And I would ask unanimous consent that his
fine letter be entered into the record in support of that bill.
Some of these bills will need more work, an additional hearing
with DoE before they are ready to be marked up. I have questions
about H.R. 8053, the GRID Act, which appears to build on DoE’s
program to protect critical defense infrastructure.
Members of the committee should have the ability to question
DoE on H.R. 7947 and H.R. 8053, which are bills that will modify
DoE’s Weatherization program and appliance standards. It appears
that both bills include new language that could have broad and far-
reaching implications for taxpayers and consumers. And at the end
of the day, they may not be terribly happy.
For example, H.R. 8053 includes a new concept that would allow
DoE to mandate demand response, which is capability that allows
a grid operator to remotely monitor and control residential appli-
ances to reduce electricity demand. I believe that that raises seri-
ous privacy concerns that, again, I don’t think are going to go over
very well with consumers.
Each of the bills before us today deserves careful consideration
from this subcommittee. I look forward to working with the major-
ity to ensure regular order.
[The prepared statement of Mr. Upton follows:]
9
PREPARED STATEMENT OF HON. FRED UPTON
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12
13
Mr. UPTON. With that, thanks again. I yield back the balance of
my time.
Mr. MCNERNEY. The gentleman yields back. The Chair now rec-
ognizes Mr. Pallone, chair of the full committee, for 5 minutes for
his opening statement.
OPENING STATEMENT OF HON. FRANK PALLONE, JR., A REP-
RESENTATIVE IN CONGRESS FROM THE STATE OF NEW JER-
SEY
Mr. PALLONE. Thank you, Chairman McNerney. Today we are
going to discuss legislation on a range of topics that affect our en-
ergy sectors, including energy supply chains, energy efficiency,
weatherization, the Department of Energy’s loan programs office,
and critical infrastructure.
So first the subcommittee will review two bills that improve en-
ergy efficiency and reduce energy costs for consumers.
H.R. 7962, introduced by Representative Dingell, makes impor-
tant changes to water heater efficiency standards and creates a
new demand response program for residential water heaters. This
legislation could have a significant impact on energy consumption,
help consumers save on the energy bills, and help utilities reduce
demand during peak times. It also contains common-sense fixes
that harmonize standards for residential and commercial water
heaters.
Then there is H.R. 7947, the Weatherization Enhancement and
Readiness Act, introduced by Representatives Tonko, Rush, and
Kaptur. It establishes an important new weatherization readiness
program, makes other practical changes to the Department of En-
ergy’s weatherization assistance program.
President Biden’s Bipartisan Infrastructure Law built on the bi-
partisan work we did in the Energy Act of 2020, investing a his-
toric $3.5 billion in the weatherization assistance program, and re-
ducing energy costs for over 700,000 low-income households. Still,
many households are not able to receive weatherization improve-
ments due to underlying structural and electrical issues. So this
new weatherization readiness program will ensure low-income fam-
ilies can make the upgrades necessary to enable them to qualify for
weatherization measures, reduce their energy consumption, and
save money on their bills.
Then we have H.R. 1599, Securing America’s Critical Minerals
Supply Act, introduced by Ranking Member Upton. That requires
DoE to conduct assessments and secure energy resources that have
vulnerable supply chains. As we work to secure a resilient and
clean energy sector, we have to make sure we are responsibly pro-
curing critical minerals here in the U.S. And the BIF took impor-
tant steps to support clean energy supply chains, and I am eager
to learn how this bill can advance our work toward a resilient,
clean energy economy.
We are also considering two bills to reform DoE’s loan programs.
H.R. 8068, the Tribal Energy Investment Act, which was intro-
duced by Representatives Leger Fernandez, O’Halleran, and Cole,
and this bill seeks to improve the Tribal Energy Loan Guarantee
Program, which permits DoE to provide loan guarantees to support
energy development projects on tribal lands. But despite our best
14
intentions in establishing that program in 2005, it has not financed
a single project in the program’s 17-year history, and that needs to
change, obviously.
So I look forward to hearing from the Native American Finance
Officers Association about how the Tribal Energy Investment Act
builds on the recent bipartisan effort included in the Fiscal Year
2022 appropriations package to unlock the promise of this essential
program.
Also, I look forward to discussing H.R. 5292, the Energy Account-
ability Act, sponsored by our late colleague, Representative Don
Young. It would prohibit DoE from guaranteeing a loan for any en-
tity that previously defaulted on an obligation guaranteed under
Title 17 of the Energy Policy Act of 2005.
And finally, we have H.R. 8053, a bipartisan bill from Represent-
atives Crow, Peters, and Bacon that amends the Federal Power Act
to provide the Secretary of Energy authority to address
vulnerabilities to the resilience of defense-critical electrical infra-
structure. And this bill seeks to ensure that homes and businesses
surrounding military installations do not bear the cost of electrical
upgrades necessary for the security of those military bases.
So I think these are all important bills that will help strengthen
our domestic energy sector.
[The prepared statement of Mr. Pallone follows:]
15
PREPARED STATEMENT OF HON. FRANK PALLONE, JR.
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Mr. PALLONE. And I yield back, Mr. Chairman.
Mr. MCNERNEY. The gentleman yields back. The Chair now rec-
ognizes Mrs. Rodgers, ranking member of the full committee, for 5
minutes for her opening statement.
OPENING STATEMENT OF HON. CATHY MCMORRIS RODGERS,
A REPRESENTATIVE IN CONGRESS FROM THE STATE OF
WASHINGTON
Mrs. RODGERS. Thank you, Mr. Chairman.
The need for President Biden to abandon his war on American
energy is becoming more urgent by the day. People can’t afford to
fill up their gas tanks. Natural gas prices are surging because en-
ergy is foundational to every part of our lives. Everything is more
expensive, especially food.
We must flip the switch on American energy, produce more, and
make life affordable again. This is clear to every American family
as they confront record inflation and energy prices, declining elec-
tric reliability, blackout threats, and looming energy security
threats from Russia’s war on Ukraine. It is clear to domestic en-
ergy producers, manufacturers, and innovators as they struggle to
attract capital to build and overcome permitting challenges, regu-
latory uncertainty, and China-controlled supply chains.
To lower costs, President Biden must focus on removing the bar-
riers to an American energy and economic resurgence. Tapping the
SPR hasn’t worked. A gas tax holiday will be ineffective, and would
undermine funding to infrastructure projects for road safety. More
government spending has fueled the inflation crisis. And asking
foreign dictators for more oil, like in Saudi Arabia, further weakens
our security and prosperity.
To secure our energy dominance and lower prices, the President
must abandon this agenda that has led to his worsening energy cri-
sis since day one. He must embrace policies that encourage invest-
ments in durable American energy, and fuel a supply of goods and
services into our economy. It means growing our tremendous en-
ergy systems, not dismantling them with rush-to-green policies
that stifle innovation, undermine security, and raise energy costs.
This should guide how we evaluate proposals concerning energy ef-
ficiency, energy infrastructure, and energy security.
Today’s hearing considers six bills on different policy topics. The
common connection among them is the Department of Energy. Un-
fortunately, DoE is not here, and we will not be able to question
DoE officials on these bills and the programs they address. I hope
we have the chance soon. In the meantime, I welcome the oppor-
tunity for members to ask questions to stakeholders and other ex-
perts here.
I am pleased to see included Fred Upton’s H.R. 1599, Securing
America’s Energy—or Critical Minerals Supply Act, which is part
of our Securing a Cleaner American Energy Agenda. This bill es-
tablishes a cabinet-level focus on identifying the critical energy re-
sources necessary to develop and supply energy in America. This
includes an assessment of supply chains across all energy systems
in the United States: a critical way to identify and reform policies
that would otherwise drive dependency on China. While much
needs to be done to strengthen energy security, establishing this
18
function at DoE makes sense. It updates the Department’s historic
role to assure reliable supplies of energy to enable energy security.
Regarding the other bills before us today, H.R. 8053 expands cov-
erage of DoE’s work to secure critical defense electric infrastructure
to all 50 states. This sounds like a positive path, but the bill goes
farther with additional contracting authorities for DoE. And more
needs to be understood on that front.
With this and some of the other bills we have questions about
implementation that we are pursuing today. There are expansions
of Federal programs that seem unrelated to the needed reset on en-
ergy policies. For example, H.R. 7947 would create a new $450 mil-
lion DoE program to prepare homes for weatherization on top of ex-
isting programs. Yet a weatherization program was just reauthor-
ized on a bipartisan basis just two years ago.
What is more, through the infrastructure law Congress just ap-
propriated 3.5 billion in additional spending on this program, far
above what was authorized in 2020. So now it appears DoE can’t
spend the money appropriated, and needs a new, duplicative pro-
gram and more funding. This deserves scrutiny. With record high
inflation, should the Federal Government be paying to essentially
flip houses on the taxpayers’ dime?
We are also concerned with mandates in H.R. 7962. This bill ad-
dresses water heater energy efficiency standards, but also requires
DoE to examine demand-side management mandates. This is far
reaching, and may place control of your water heater in the hands
of utilities or other third parties. There are huge implications of
this, and we must answer those questions.
Overall, I look forward to our witnesses’ testimony today. Wel-
come to Ben Lieberman, former committee staffer, and Lou
Pugliaresi back to the committee. I look forward to your insights,
and what is needed to reset our economic and energy policy, and
ensure energy and economic resurgence in the great United States
of America.
[The prepared statement of Mrs. Rodgers follows:]
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PREPARED STATEMENT OF HON. CATHY MCMORRIS RODGERS
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Mrs. RODGERS. I yield back. Thank you.
Mr. MCNERNEY. The gentlewoman yields back.
The Chair would like to remind members that, pursuant to com-
mittee rules, all Members’ written opening statements shall be
made a part of the record.
I have already introduced the witnesses, and I thank you again
for joining us today. At this time the Chair will recognize each wit-
ness for 5 minutes to provide their opening statement.
Before I begin, I would like to explain the lighting system. In the
front of the witnesses is a series of lights. The light will initially
be green. The light will turn yellow when you have one minute left.
Please begin to wrap up your statement at that time. The light will
turn red when your time expires.
Mr. DeLaski, thank you for coming. You are recognized for 5
minutes.
Mr. DELASKI. Thank you. Thank you very much.
Mr. PUGLIARESI. Thank you, Mr. Chairman.
Mr. DELASKI. Thank you for the opportunity to testify today——
Mr. PUGLIARESI. I think we have some slides. Chairman——
Mr. MCNERNEY. Mr. DeLaski is recognized first.
Mr. PUGLIARESI. Oh, I am sorry.
Mr. MCNERNEY. Remotely. Sorry.
Mr. DELASKI. OK. Thank you. Thank you again for the oppor-
tunity to testify on two very important bills. These are pragmatic
bills that address real problems that face people across the United
States.
Mr. MCNERNEY. Mr. DeLaski, you are not being—your audio is
not sufficient. Could you turn it up?
Mr. DELASKI. How is that working now?
Mr. MCNERNEY. It is better.
Mr. DELASKI. And is it working better now?
Mr. MCNERNEY. Not—it is not sufficient yet. OK, we are going
to turn it up here, if you will wait for a moment.
Mr. DELASKI. How is my audio now?
Mr. MCNERNEY. OK. Please try again.
Mr. DELASKI. OK, I will start again. Is it OK now?
Mr. MCNERNEY. Not really.
VOICE. Why don’t we start with Mr. Frias?
Mr. MCNERNEY. OK. We will skip this witness initially, and start
with Mr. Frias.
Mr. Frias, would you give us your opening statement?
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STATEMENT OF RICHARD FRIAS, EXECUTIVE DIRECTOR, NA-
TIVE AMERICAN FINANCE OFFICERS ASSOCIATION; ANDREW
DeLaski, EXECUTIVE DIRECTOR, APPLIANCE STANDARDS
AWARENESS PROJECT; DUSTIN MULVANEY, PH.D., PRO-
FESSOR, ENVIRONMENTAL STUDIES, SAN JOSE STATE UNI-
VERSITY; JOSHUA C. GREENE, ESQ., CORPORATE VICE
PRESIDENT, GOVERNMENT AND INDUSTRY AFFAIRS, A.O.
SMITH CORPORATION; LUCIAN PUGLIARESI, PRESIDENT,
ENERGY POLICY RESEARCH FOUNDATION, INC. (EPRINC);
AND BEN LIEBERMAN, SENIOR FELLOW, COMPETITIVE EN-
TERPRISE INSTITUTE
STATEMENT OF RICHARD FRIAS
Mr. FRIAS. Greetings, Chairman McNerney, Ranking Member
Upton, Chairman Pallone, and Ranking Member Rodgers. My
name is Rico Frias. I am the executive director of the—of NAFOA,
and a citizen of the Chihene Nde Nation. Thank you all for your
time today, as well as the opportunity to talk about talk—talk in
support of H.R. 8068, the Tribal Energy Investment Act of 2022.
As anyone who has filled their gas tank in the past few weeks
knows, the energy industry touches every part of our economy and
of our daily lives. We have seen how energy development can trans-
form communities, how it can pull entire regions out of poverty,
and how it can shape world events. At NAFOA we know that tribal
governments are excited to unlock the energy potential of Indian
country, and we believe that H.R. 8068, which permanently
changes the ability of the loan programs office to offer direct na-
tion-to-nation loans, is an important step to helping us get there.
Indian tribes hold a unique place in our country. They also face
challenges that traditional energy development organizations do
not face. For example, the status of tribal trust land creates bar-
riers that non-tribal energy developers would not encounter. The
change from loan guarantees to direct loans from the Department
of Energy removes the impediment of finding a lender willing to
fund the project. The lack of access to capital is a longstanding
problem, as many institutions have largely shown an unwillingness
to work in and with Indian country.
Direct loans are also more consistent with the nation-to-nation
relationship that tribes share with the U.S. Federal Government.
The treaties are the basis for the trust responsibility the U.S. has
with tribes. Permanently authorizing the loan program’s office to
do direct loans strengthens the nation-to-nation relationship, and
takes another step in fulfilling the promises the United States has
made to tribes.
By permanently authorizing LPO to offer direct loans to tribal
governments, we are addressing two critical topics for Indian coun-
try: energy and economic development. By offering direct loans, we
are removing an unnecessary component from an already complex
process, and addressing the lack of access to capital that tribes and
tribal members face.
For the future of tribes it is crucially important that quality,
high-paying, and, perhaps most importantly, long-term jobs are on
or close to traditional tribal lands. This helps solve several of the
issues tribal governments face, such as creating jobs that encour-
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age tribal members to stay within their communities, and to ensure
that employment remains diversified so that a downturn in one in-
dustry, which we have seen due to COVID recently, would not
cause outsized economic harm to the tribal economy.
Direct loan authority also addresses the lack of access to capital
within Indian country. Banks and other financial institutions have
for many years failed to work in Indian country. This is why the
change from loan guarantees to direct lending is so important.
While we encourage financial institutions to work in Indian coun-
try, the recent joint notice of proposed rulemaking on the Commu-
nity Reinvestment Act shows how difficult it really is to bring cap-
ital into tribal communities and other under-served communities.
One of the major benefits we feel of the LPO direct loan program
is that the program, like NAFOA, is technology agnostic. We know
the benefit of a clean, balanced, and stable climate, as well as the
need for energy transition over the coming years. However, while
tribes and their members are excited to participate in the new en-
ergy industry, they should not be required or asked to bear the eco-
nomic burden of the energy transition that the broader economy is
still economically benefiting from.
Additionally, renewable energy products—projects require a tax
equity partner, which adds another layer of complexity for tribes
to overcome.
It is also crucial for the unique nation-to-nation relationship and
for tribal self-determination that individual tribes be allowed to de-
cide which energy sources meet their community’s unique needs
and economic circumstances.
When tribes are given a level playing field, they are able to com-
pete with and even surpass the competition. Permanent authoriza-
tion of the LPO loan program is another step toward unlocking the
Indian country’s potential for not just energy, but economic devel-
opment overall. Removing uncertainty around the LPO’s authority
to offer direct loans will help tribes across the country to compete
in the energy industry, and ensure that our economy works for ev-
eryone.
Again, I thank you very much for your time today, and for allow-
ing me to testify. I am available for any questions.
[Speaking native language.] Thank you.
[The prepared statement of Mr. Frias follows:]
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Mr. MCNERNEY. Thank you. The gentleman yields. We would
like to try again to recognize Mr. DeLaski, and hope that this time
we can follow through.
Mr. DeLaski, you are recognized.
STATEMENT OF ANDREW DELASKI
Mr. DELASKI. Thank you. I appreciate the opportunity to testify
today, and thank the committee for this opportunity.
I am here today to testify in favor of two very important bills:
H.R. 7947, the Weatherization Enhancement and Readiness Act;
and H.R. 7962, a bill to amend the Energy Policy and Conservation
Act with respect to water heaters.
I would like to thank Representatives Tonko and Dingell, respec-
tively, for the introduction to these bills, and all the cosponsors for
their support.
I am here today on behalf of two organizations, the Appliance
Standards Awareness Project, of which I am the Executive Direc-
tor; and the American Council for an Energy Efficient Economy.
ACEEE is a non-profit, 501(c)(3) organization that acts as a cata-
lyst to advance energy efficiency policies, programs, technologies,
investments, and behaviors so that all households experience equi-
table benefits from energy efficiency improvements. ASAP is a coa-
lition project housed at ACEEE that works to advance and defend
new appliance equipment and lighting standards that cut emis-
sions that contribute to climate change, and other environmental
and public health harms, save water, and reduce economic and en-
vironmental burdens for low and moderate-income households.
I also want to recognize organizations that were involved in the
development of the Weatherization Enhancement and Readiness
Act and helped us prepare this testimony: the National Association
of State Community Services Programs, the National Community
Action Foundation, and the National Consumer Law Center. We
are grateful for their longstanding leadership on this program, and
their work to support this bill’s development.
With respect to the water heater bill, I would like to recognize
the contributions of the Air Conditioning, Heating, and Refrigera-
tion Institute; the National Rural Electric Cooperative Association;
the Solar Energy Industries Association; and the Natural Re-
sources Defense Council. We worked in collaboration with each of
these organizations during the bill’s development. And we also con-
sulted with State governments, other efficiency organizations, and
individual utility companies. Of course, any errors in this testi-
mony of commission or omission are my responsibility alone.
These bills will improve two of the most important Federal pro-
grams for easing the burdens of high energy bills on low-income
families, and delivering large energy savings that protect our envi-
ronment, improve power system reliability, and improve energy se-
curity.
The first, the Weatherization Enhancement and Readiness Act,
would add needed flexibility to the Federal weatherization assist-
ance program, which helps low-income families by making energy
efficiency improvements to their homes. The reforms contained in
this bill would, first, raise the maximum amount that the program
can invest in any one home, a critical need with wages rising, also
31
particularly important for rural households that can be more ex-
pensive to serve.
It would also—the bill would, second, increase the amount avail-
able to make essential repairs to homes which are necessary for
safe, effective, and durable weatherization improvements.
Third, it would raise the cap on solar energy investments for a
home allowed under the program.
And fourth, it would remove bureaucratic barriers to weatheriza-
tion improvements.
With energy prices on the rise through the war in Ukraine and
severe weather events that can threaten health and safety hap-
pening more frequently, such as the severe heat waves of last
week, people across the country need Congress to act on this bill.
Today, as many as one in five eligible households is not able to
benefit from this program, due to structural problems with their
home: a hole in a roof, a mold problem. This bill would create more
opportunities, more flexibility to address these problems so homes
can be weatherized.
Reforms in this bill are urgently needed in 2022 to make sure
that the lowest-income households—many of them rural, many peo-
ple of color, many elderly—that have the greatest need of assist-
ance can fully benefit from the weatherization assistance program.
The second bill would amend the National Appliance Energy
Conservation Act, a cornerstone of U.S. energy policy that covers
about 60 product categories. The average U.S. household today is
spending about $500 less per year on their utility bills because of
existing standards enacted under this program. It is one of the
most successful programs for reducing utility bills for consumers,
saving energy.
Standards have also resulted in an enormous reduction in cli-
mate change emissions and other pollutants. This bill would amend
the law with respect to water heaters, one of the largest energy-
using products in our homes and businesses. It would update defi-
nitions to clarify the line between consumer and commercial water
heaters, it would add a new definition for solar thermal water heat-
ers. And third, it would authorize the development of demand re-
sponse requirements for water heaters.
[Audio malfunction.]
Mr. DELASKI [continuing]. This third element. It is a package of
amendments, but I will focus on the third.
Demand response is a well-established technique for shifting
electricity use away from times of peak demand to times when
cheap, clean power is available, thus reducing costs and improving
reliability. By heating water when power is cheap and clean, it is
possible to save money, reduce demand peaks that can threaten
grid reliability, and cut emissions from fossil generation.
Historically, some utilities have retrofitted water heaters with
demand response capabilities for customers at or after the time of
installation. But the capability could be more cost-effectively added
to products at the time of manufacture. Several states have now es-
tablished or authorized such manufacturing requirements.
This bill would authorize the development of a national demand
response requirement that could improve business certainty for
manufacturers and for utilities, facilitate broader access to this im-
32
portant technology, and strengthen grid flexibility and reliability.
To ensure—it could ensure a common communications protocol,
easing the pathway to large-scale demand response and significant
cost savings for consumers. A national requirement would preempt
additional states from setting their own requirements, helping to
promote a consistent national marketplace for water heaters.
Both these goals are urgently needed to approval.
Mr. MCNERNEY. Yes, would you please wrap up your testimony?
Mr. DELASKI. I am finished. Thank you very much.
[The prepared statement of Mr. DeLaski follows:]
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Mr. MCNERNEY. Thank you.
The Chair now recognizes Mr. Mulvaney for 5 minutes.
STATEMENT OF DUSTIN MULVANEY
Dr. MULVANEY. Good morning, and thank you for this oppor-
tunity to discuss an important topic to our environment and econ-
omy. My name is Dustin Mulvaney. I am a professor at San Jose
State in the environmental studies department, and a fellow at the
Payne Institute for Public Policy at the Colorado School of Mines.
My area of expertise is lifecycle impacts, environmental justice
impacts of clean and renewable energy technologies and infrastruc-
tures, with a particular emphasis on photovoltaics and lithium ion
batteries. I have a Ph.D. in environmental studies, and a master’s
in environmental policy, and a bachelor’s in chemical engineering.
I have been an expert witness at the California Public Utilities
Commission for over a decade, and I currently serve on the tech-
nical committee for ultra low carbon standard for photovoltaics
under development with the Green Electronics Council.
We are in the midst of a low-carbon energy transition, one that
is outpacing even the expectations of professional analysts. A
growth in photovoltaics, wind turbines, lithium ion batteries,
electrolyzers for hydrogen, heat pumps, fuel cells are all poised for
dramatic growth in the coming decades.
However, many of these same technologies that support rapid
decarbonization depend on metals, minerals, and materials that
are fraught with supply chain issues, from accusations of forced
labor, child labor, geographic concentration, disruptions with logis-
tics, environmental impacts from mining, and feedstock processing,
and material bottlenecks. Demand for some of these materials often
outstrip supply, and that causes price increases and price volatility
for key inputs such as lithium, nickel, cobalt, polysilicon, and many
others, making the case that the United States would benefit from
growing domestic manufacturing and supply chains and lessen
dependance on imports.
There is a tremendous opportunity to grow domestic industries
and reshore supply chains. The United States used to be a major
producer of polysilicon, a major producer of rare earth elements.
However, while it is critical to develop these resources for clean
and renewable energy devices and infrastructures through respon-
sible mining, the only way to do that is to—is first by updating our
150-year-old mining law that has allowed a toxic legacy on public
lands to continue to this day.
We also need to ensure that we are utilizing waste streams and
considering alternative materials. These could be strategic opportu-
nities to mitigate impacts of mining through improved collection
and recycling of equipment and devices that contain and could aug-
ment supplies of these critical metals, materials, and minerals.
So it is notable to see language in bill H.R. 1599 that emphasizes
improving technology that reuses and recycles to recapture the
end-of-life waste flows that would otherwise be landfilled or dis-
posed of as hazardous waste. There is much room for improvement
in recycling in recovery rates for lithium ion batteries, for example,
which are not just for the electric grid and vehicles, but also in, you
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know, personal electronics, consumer electronics, cell phones,
power tools, and computers.
And there are significant carbon emission savings from recov-
ering materials from some of these used batteries, as well. Yet
most of lithium ion batteries go uncollected. In fact, lithium ion
batteries that are unsorted is a leading cause of fires at material
recovery facilities, often causing local governments millions of dol-
lars in damages.
It is also fundamentally important to emphasize incentives in
policy that develop substitutes and alternatives to critical minerals
as sustainable ways to secure domestic supplies. This would help
mitigate extensive impacts from extractive industries, which can be
thinly regulated and environmentally damaging. We are already
seeing companies move away from cobalt, nickel, and manganese
in the next generation lithium ion batteries, and someday we may
see batteries that all together avoid graphite and lithium.
There are a few specific items in H.R. 59
[sic], as written, that raised concerns in my read.
First, section 3 says the Department of Energy will need to in-
crease domestic production, separation, and processing. This is con-
cerning because it suggests DoE would be in charge of mining per-
mitting and oversight, activities which should continue to be in the
domains of the Department of the Interior and Environmental Pro-
tection Agency. These latter two Federal agencies have the exper-
tise and mandate to minimize impacts to lands, waters, and com-
munities. The DoE, for example, has no expertise with government-
to-government tribal consultation processes with indigenous com-
munities, and it is hard to imagine DoE developing the policies and
in-house expertise to do this work.
Second, the language of the bill is very vague, with general ref-
erences to energy and energy systems throughout. The text is not
exclusive to critical minerals, and makes no mention of low carbon
or decarbonization as a goal that could be applied to development
of any mineral resources such as natural gas, petroleum, and coal.
Failure to be specific here would be sending mixed messages to the
markets, and undermine efforts to grow domestic low-carbon manu-
facturing and supply chains.
Third, I hope that public policies that encourage domestic indus-
tries can avoid undermining tribal consultation, cultural resource
review, and bedrock environmental laws that have benefited all
Americans simply to expedite mining.
And finally and importantly, it is key to realize that, without en-
suring the entire supply chain is domestic, supply chains can still
be vulnerable to disruption. Domestic mining that requires over-
seas smelting or chemical processing before returning to domestic
manufacturing is still supply chain vulnerable to disruption.
In summary, we need to be strategic and thoughtful about how
to grow domestic industries to build a low-carbon economy. Failure
to do so will undermine the benefits an energy transition will
bring, and risk leaving vulnerable and historically marginalized
communities behind.
Thank you again for the committee, and I look—for hosting this
discussion, and I look forward to any questions from the committee.
[The prepared statement of Dr. Mulvaney follows:]
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Mr. MCNERNEY. Thank you.
Mr. Greene, you are now recognized for 5 minutes for your open-
ing statement.
STATEMENT OF JOSHUA C. GREENE
Mr. GREENE. Thank you, Mr. Chairman. Chairman McNerney
and Ranking Member Upton, members of the subcommittee, my
name is Josh Greene. I serve as corporate vice president of govern-
ment and industry affairs of A.O. Smith Corporation. And I would
like to thank you for the opportunity to testify today on behalf of
the water heating industry, as well as our umbrella organization,
the Air Conditioning Heating Refrigeration Institute.
By way of very brief background, A.O. Smith is one of the world’s
largest manufacturers of residential and commercial water heaters,
boilers, and pool heaters, and a leading global manufacturer of
water treatment and filtration products. We are publicly traded on
the New York Stock Exchange, and a member of the S&P 500. And
we are globally headquartered in Milwaukee, Wisconsin since 1874.
We employ approximately 14,000 people around the world at 36 fa-
cilities, and do business in over 60 countries.
Now, as it relates to H.R. 7962, as the committee knows, this is
bipartisan legislation that will provide important updates and
clarifications to the definitions of water heating products under the
Energy Policy and Conservation Act, or EPCA, and the legislation
also responds to technology evolutions in the water heating indus-
try, and—which will also provide business certainty for manufac-
turers, their consumers, and customers. And this is obviously im-
portant to us, as an industry that—and our customers that use our
equipment on a daily basis.
As the committee knows, Congress established the first national
standards for commercial water heaters as part of the Energy Pol-
icy Act of 1992. And those statutory definitions are now 30 years
old. And though DoE—the Department of Energy, excuse me—peri-
odically updates the regulatory definitions, either by direction from
Congress or relying on its delegated authority, subject to notice and
comment.
Unfortunately, sometimes the regulatory process has its limits.
Without periodic updates to the statute to ensure EPCA remains
up to date with technology, there is a necessary component to up-
dating the statute. And one of the criteria as it relates to the stat-
ute is the binary criteria that is currently in law that distinguishes
residential and commercial water heating equipment. And those
are really just based on the sole energy input of the water heating
equipment, notwithstanding that there are various characteristics
that distinguish residential and commercial water heating equip-
ment, such as amperage and voltage, and the end use applications,
the outlet water temperature, amongst other things. And we high-
lighted that in our written testimony.
One of the things that DoE did in 2016, in response to some
other issues, is amend—or really, slightly altered their regulatory
definitions of water heating equipment, and specifically commercial
water heating equipment. And what ended up happening is that
manufacturers were then faced with a decision to transition com-
mercial water heating equipment that heretofore, for decades be-
49
fore, had been treated as commercial and having to meet commer-
cial standards, to potentially dramatically shift them to meet resi-
dential standards. And that would have otherwise created a vacu-
um in the marketplace, and for some manufacturers to stop pro-
ducing certain commercial water heaters all together. And these
are products that commercial customers had been relying on for
decades.
Thus, manufacturers had to transition very quickly, and that
caused some uncertainty in the marketplace. And what ended up
happening from there in 2017 is that the Department of Energy,
along with manufacturers, came together and decided that the best
course forward would be to amend the statutes so we don’t have
the ebb and flow and kind of the regulatory uncertainty relating to
these issues.
So that put us in a tight position. But over the last several years
we have been working in earnest with a broad set of stakeholders,
including with counsel from the Department. And H.R. 7962 is the
end result of those efforts.
Now, my written testimony addresses some of the more specific
updates afforded in the bill, and I am happy to answer questions
on those. But the core components of that legislation are important,
and it is really to clarify this definitional line between residential
and commercial water heating equipment, taking into consideration
the key characteristics the commercial water heating equipment
has that is more than just the sole energy input.
The other issue in 7962 includes one refinement that was not ad-
dressed in previous iterations of the bill, but one in which manufac-
turers support, and that is language—excuse me—that would oth-
erwise authorize the Department to issue a final rule by December
31st, 2024 that will require certain residential electric storage
water heaters to have the capability to participate in utility de-
mand response programs, but only if that requirement is techno-
logically feasible and economically justified.
This provision represents an opportunity to establish a national
standard for a narrow product class of innovative water heating
technology that heretofore is subject to—and increasingly by—
state-by-State regulation. And that, unfortunately, presents some
compliance obligations and a quagmire for manufacturers. And
having a national standard and the benefits of the preemption that
is embedded in EPCA as a threshold matter is better for manufac-
turers, not only for business certainty, but it allows us to have one
standard, as opposed to multiple standards moving forward.
So I will close with the following. Technology and innovation in
our industry have outpaced statutory definitions for the most part,
and these definitions are no longer up to date when it applies to
commercial water heating equipment. And more broadly, H.R. 7962
offers a bipartisan and broad stakeholder solution to update the
EPCA.
Once again, on behalf of A.O. Smith and the water heating in-
dustry, I appreciate the opportunity to testify on this important bi-
partisan bill, and I appreciate Congresswoman Dingell and Mr.
Walberg for their leadership in this regard. Thank you.
[The prepared statement of Mr. Greene follows:]
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Mr. MCNERNEY. Thank you.
Mr. Pugliaresi, you are now recognized for 5 minutes.
STATEMENT OF LUCIAN PUGLIARESI
Mr. PUGLIARESI. Chairman Pallone, Chairman McNerney, Rank-
ing Member Upton, Ranking Member Rodgers, members of the sub-
committee, I want to thank you for the opportunity to testify on
this proposed legislative—these proposed legislative initiatives.
We are now in the midst of an energy crisis that may last for
years to come. A mix of forces have led to this crisis, including ac-
celerated demand as the world economies rebound from the pan-
demic lockdowns, sustained under-investment in fossil fuels, and a
fundamental misunderstanding of the impact of government poli-
cies on energy markets. Clearly, Ukraine war has exacerbated this
crisis, but these disruptions to our energy systems were well under-
way before the war began.
If I could have the first slide, please.
[Slide]
Mr. PUGLIARESI. Thank you. As you can see here, rising prices
are especially harmful to low-income households: 40 percent of
these households are seeing very rapid increases between 2021
and—2020 and 2021; 2022 is a nightmare.
Next slide, please.
[Slide]
Mr. PUGLIARESI. Look, we have put an enormous amount of effort
at EPRINC in understanding the scale challenges of moving to net
zero. But this graphic shows you that, in the absence of large sup-
plies of natural gas, we would only have enough fertilizer to feed
about three billion of the planet’s eight billion people. Large sup-
plies of low-cost natural gas are critical to food security.
I would like to also point out that four pillars of modern civiliza-
tion—cement, plastics, ammonia, and steel—have no cost-effective
substitute.
Next slide.
[Slide]
Mr. PUGLIARESI. You can see here the rising fertilizer prices are
also spiking food costs, and they are also increasing—you know, the
increase in natural gas with ammonia prices and corn. So we have
a kind of perfect storm of rising prices from higher fossil fuel
prices.
Next slide.
[Slide]
Mr. PUGLIARESI. OK. We need a massive amount of critical min-
erals in order to engage in a rapid transition to the fuels and en-
ergy sources of the future. As noted in my written testimony, most
of these minerals and materials for the energy system have been
sourced outside of the OECD. In this regard, H.R. 1599 appro-
priately recognizes that the energy transition offers the potential to
somewhat insulate us from volatility and supply chain disruptions
associated with oil and gas production. But it will introduce a new
set of supply risks.
It is appropriate that these critical minerals and materials be
fully incorporated into the Department of Energy’s ongoing respon-
55
sibilities to bolster supply—you know, to bolster U.S. energy secu-
rity.
Next slide.
[Slide]
Mr. PUGLIARESI. Yes. Any of us who thought that, by moving to
the these fuels of the future, these energy sources of the future,
that we would eliminate risk for volatility can just look at what is
happening now.
In fact, we issued a chart of the week today that looked at nearly
a doubling in the cost of the Tesla battery. And you can see that
price indices for key electric vehicle battery metals have been just
skyrocketing in cost. It is not going to relieve our problems with
the volatility and supply risks.
Next slide.
[Slide]
Mr. PUGLIARESI. One way to get down gasoline prices is to build
out the infrastructure and the capacity of the North American oil
and gas production platform.
As you can see here, between 2010 and 2020, the United States—
the United States alone—provided over 80 percent of world incre-
mental demand for petroleum. And it was in that period that we
had extremely low gasoline prices. The North American Petroleum
Platform is an instrument—sort of, if you like, a strategic asset for
the United States. It is essentially the arsenal of energy security.
Next slide.
[Slide]
Mr. PUGLIARESI. The U.S. is also a major supplier of natural gas,
not just to our industry, but to the world market. Right now—if
you see the sort of negative sign, there is actually a plus for ex-
ports. We are exporting ten billion cubic feet a day. This is roughly
equivalent to 40 percent of European requirements for their import
needs for natural gas.
And I will find—one last slide, next slide.
[Slide]
Mr. PUGLIARESI. I know that we are looking for ways to reduce
gasoline prices, and probably you are tired of hearing from us on
this. But one way that we could take 30 percent—$0.30 off the
price of gasoline, much more than a gasoline tax, would be to make
a small adjustment in the renewable fuel standard, to take it down
to close to the market-based level, which would be about ten per-
cent. This will take back some of the high compliance costs and
other factors in the market that are driving up gasoline prices.
And with that, Mr. Chairman, I conclude my remarks.
[The prepared statement of Mr. Pugliaresi follows:]
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Mr. MCNERNEY. I think the witness.
Mr. Lieberman, you are now recognized for 5 minutes.
STATEMENT OF BEN LIEBERMAN
Mr. LIEBERMAN. Chairman Rush, Mr. McNerney, Ranking Mem-
ber Upton, and members of the subcommittee, thank you for the
opportunity to testify today. My name is Ben Lieberman, and I am
a senior fellow at the Competitive Enterprise Institute, a non-prof-
it, non-partisan public policy institute committed to advancing the
principles of free markets and limited government.
Before that, I had the privilege of serving on this committee from
2011 to 2018, where I worked on several DoE issues under Chair-
man Upton, and for a shorter time under Chairman Walden. And
to all of you who are retiring, best wishes in your well-earned re-
tirements.
I would like to use my time to just three of the DoE programs
that are the subject of some of the bills being discussed today: ap-
pliance efficiency standards, weatherization assistance, and loans
and loan guarantees.
If there is a common theme, it is that these programs were cre-
ated to address market failures that have proven to be considerably
overstated, and thus the benefits from government involvement are
minor and not worth the burdens to consumers and taxpayers. I
would like to start by making a few general points about DoE’s ap-
pliance efficiency programs, which have been around since the
1970’s.
It is important to recognize that, for virtually every regulated ap-
pliance, there already are numerous models on the market that go
above and beyond the current Federal standards and there are the
Federal Trade Commission energy use labels and the Energy Star
program that make it easy for consumers who want ultra-efficient
appliances to identify and choose them. But new standards only
serve to force that choice on everyone, whether the extra cost
makes sense for them or not.
One size does not fit all, and we all know our own individual cir-
cumstances and preferences better than any DoE regulator could.
Not every homeowner comes out ahead with efficiency standards.
We have seen that standards have raised the purchase price of ap-
pliances, in some cases more than consumers can expect to earn
back in the form of energy and water savings. In addition, some
standards have compromised product performance, such as those
that led to dishwashers taking multiple hours to finish a load. And
at this point, most major home appliances have been subjected to
two, three, four, five rounds of successively tighter standards.
So the risk of diminishing marginal returns, even negative mar-
gin returns, is greater than ever. I am particularly concerned that
these DoE efficiency programs are now being hijacked in pursuit of
climate agenda, with potentially adverse consequences for con-
sumers. As we see with the recently proposed residential furnace
rule, which might be the subject of a future hearing, social cost of
carbon is now being used as a thumb on the scale in favor of new
rounds of more stringent standards that threaten higher costs and
shift the focus toward environmental goals, rather than what is
best for consumers.
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Especially troubling—and again, something we see in the pro-
posed furnace rule—is the effort to use these standards to elimi-
nate the option of natural gas appliances, even though they are the
best choice for many consumers since natural gas is generally
cheaper than electricity.
Simply put, it is not the role of government to dictate choices and
tell homeowners what they can and cannot have in their homes.
By the same token, I would oppose provisions in H.R. 7962 man-
dating demand response capability in water heaters when many
homeowners do not want this feature and, in fact, some would
strongly object to it. We need to respect consumer choice, and this
measure does not.
Demand response is also something that moves us away from the
original purpose of the Appliance Standards Program, and is yet
another example of mission creep toward climate policy.
With regard to other DoE programs that are the subject of to-
day’s legislative hearing, weatherization and loan programs, I just
don’t believe we are getting very much bang for the buck. In par-
ticular, the weatherization program is one in which economists and
others have questioned whether the expenditures exceed the bene-
fits. As it turns out, most homeowners, even many low-income
ones, take reasonable steps on their own to prevent wasting en-
ergy, and thus the marginal benefit of government programs is lim-
ited.
In addition, with so much money already being allocated to
weatherization programs, I think we are already overspending on
weatherization. And therefore, H.R. 7947 is difficult to justify.
I would like to conclude by emphasizing what I think is an obvi-
ous point, and that is that the best thing Congress can do right
now to save consumers money on their energy bills is not demand
response to water heater mandates, or free weather stripping, or
more DoE loans, it is to get these damn prices down.
Now, I was working on this committee during a really tremen-
dous transition, where we went from very real concerns about
America running out of oil and natural gas to this incredible shale
revolution. But now we are seeing that revolution neutralized by
Federal policies blocking domestic energy production and infra-
structure. It is time to put energy affordability first, and that can
be done by once again unleashing American energy.
To the extent that we do want to make changes to DoE pro-
grams, the focus should be on reining in the regulatory reach and
strengthening the consumer and taxpayer protections in the law.
Thank you.
[The prepared statement of Mr. Lieberman follows:]
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Mr. MCNERNEY. I thank the witness. The Chair—we have con-
cluded our opening statements. We will now move to member ques-
tions.
Each member will have 5 minutes to ask questions of our wit-
nesses. I will start by recognizing myself for 5 minutes.
As we move toward achieving a national zero emissions energy
system, securing a domestic supply of critical materials needed for
solar cells, wind turbines, batteries, and other renewable compo-
nents will be a significant challenge.
Dr. Mulvaney, what safeguards are needed to ensure that the do-
mestic production of critical materials is done responsibly?
And what role, if any, do you think the Department of Energy
should have in that mission?
Dr. MULVANEY. I think, as I stated in my testimony, you know,
it is a very difficult challenge, I think, to balance these, you know,
our climate objectives and land use impacts of domestic mining.
And I think we just really need to make sure that we tighten up
a very old law.
I mean, the 1872 mining law, you know, is very unclear on, for
example, reclamation or legacy mine tailings. And the EPA, you
know, is cleaning up many, you know, legacy tailings piles across
the American West from, you know, historic mining of public lands.
So I think that is really important.
And I am also hearing in the public discourse a lot of conversa-
tion about how the National Environmental Policy Act is holding
up much of mining efforts. And I just don’t see that as a valid—
not supported by the empirical record. It is, you know, protecting
the National Environmental Policy Act, and it is the policies that
are—that emerge out of that, the Clean Water Act, and some of the
Endangered Species Act and the National Historic Preservation
Act. I think these are really important policies, and they have done
very well for the American public to date.
So now, as far as the Department of Energy’s role, you know, the
Department of Energy could help perhaps finance some of these
mining efforts if we find that some of these sites, which, you know,
could be justified, sustainable mining practices and things like
that, perhaps there are vehicles that the Department of Energy
could use, like the loan program, for example, to help develop some
of these resources.
But, you know, I think we are also missing a big piece of this,
which is the recycling and materials recovery part. There seems to
be in this conversation about securing critical minerals, metals,
and materials, just more production and more extraction, when we
are really letting a lot of these resources slip through the cracks,
and they are getting landfilled and sent to——
Mr. MCNERNEY. OK, thank you for answering that question.
I have long advocated for policies to address the energy water
nexus, which, among many other things, relates to the energy re-
quired to heat water in a home. Mr. DeLaski, and your testimony
is focused on the electricity savings that could be achieved by in-
creasing the energy efficiency of water heaters. But can you speak
to how increasing the water efficiency of appliances and fixtures in
a home or building could also lead to energy savings?
80
Mr. DELASKI. Absolutely. Setting water efficiency standards for
a range of products can also drive enormous energy savings, be-
cause we use a lot of energy in this country to heat water for our
homes and for our businesses.
Your State, California, of course, has led work there. The dry
West is facing historic drought, and the opportunity to save water
is important not just for energy savings, but also for ensuring that
we have water resources to meet the needs of the dry West. And
standards set by both the Department of Energy and by individual
states like—such as California, Colorado, Arizona, and others are
driving considerable water savings today for a range of water-using
devices.
Mr. MCNERNEY. Well, could you address the alternatives to re-
ducing water waste while people are waiting for the water at the
tap to heat up?
Mr. DELASKI. The alternative—I am sorry, could you reState the
question, please?
Mr. MCNERNEY. Well, when you turn on your hot water, you got
to wait for a minute or two for the water to heat up, unless you
have a demand—on-demand water heating. What are the alter-
natives to eliminate that waste?
Mr. DELASKI. Right. Well, one of the alternatives is to—as you
said, on-demand water heaters are an option for that. Another al-
ternative is using recirculation techniques to reduce—you know, to
reduce water waste. But those are two options that I am familiar
with.
Mr. MCNERNEY. Well, my time is expired. The Chair will now
recognize Mr. Upton, subcommittee ranking member, for 5 minutes
to ask his questions.
Mr. UPTON. Thanks, Mr. Chairman. It is always good to be with
you.
Mr. Lieberman, welcome back. It is good to see you, that is for
sure.
As you know, NERC is reporting that we are at increased risk
of blackouts this summer—perhaps, as I said, even this weekend,
as our electric grid becomes more unstable. Baseload power plants
like coal, nuclear, and natural gas are being forced into early re-
tirement, with weather-dependent wind, solar batteries taking
their place, we hope.
Some believe that we ought to stabilize the electric grid with de-
mand response, as we know, which gives the grid operators the
ability to remotely monitor and control our home appliances to bal-
ance supply and demand. What do you expect the consumer protec-
tion and privacy concerns associated with demand response are
going to be?
Mr. LIEBERMAN. [Inaudible.]
Mr. UPTON. I mean, you got to use your—you should know best
of all.
Mr. LIEBERMAN. I should know this by now.
Mr. UPTON. Push the button.
Mr. LIEBERMAN. A man’s home is his castle. A woman’s home is
her castle. These should always be decisions made by the home-
owner, and never the government. It is really as simple as that.
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And sure, we can save energy if utilities can shut the appliances
on and off. But that is not what consumers want.
And I should add I am not opposed to demand response capa-
bility. I am only opposed to mandating it. Let consumers who want
this feature, who think that they can save money with it, let them
go ahead with it. But I can tell you, as a homeowner myself, this
is—I wouldn’t want to be a guinea pig in this experiment.
Mr. UPTON. It reminds me of the saying, ‘‘If Mama ain’t happy,
nobody’s happy.’‘
Do you think it ought to be mandated by the Federal Govern-
ment, or should it be a choice, then?
Mr. LIEBERMAN. I think that is the problem. It shouldn’t be man-
dated by the Federal Government. There is very real privacy issues
here.
Also, when I hear about this scheme, it strikes me as very con-
voluted. I really question whether it can work as well as some are
hoping. It absolutely has to be voluntary.
And to me, I think there is almost a philosophical divide here.
There are people here that argue this is such a great idea we need
to mandate it. But I am the one who is saying, if it needs to be
mandated, it is probably not a great idea.
Mr. UPTON. Mr. Pugliaresi, I want to give you the opportunity
to address the energy crisis that we are facing today. We use fossil
fuels for everything in our economy, from plastics and fertilizer—
your graphs were terrific. What are some of the near-term solu-
tions to record-setting energy prices that we ought to be looking at
and focused on?
We know about Keystone, and we know about permitting infra-
structure needs with NEPA reforms sending the right signal, but
what are some of—what are some basic things that we ought to be
focused on, and what might you suggest that we do?
Mr. PUGLIARESI. Yes. So first we need to send the right signals
to the marketplace. We need to restore the leasing program. We
need to give confidence that the North American Production Plat-
form can have an expansive, cost-efficient expansion over time. And
the government is heavily involved in affecting that outcome.
We need to permit a lot more natural gas pipelines. The
Marcellus, West Virginia, Pennsylvania, Ohio, these are enormous
gas reserves. They have production levels that look like Saudi Ara-
bia if they were oil. We can double or triple U.S. natural gas pro-
duction in the United States. We can keep our prices low, and we
can supply the world.
We are, as I said, an arsenal of energy security. But we have to
change the policies. We need to give assurance in these constantly
interventions—I mean, I know you are quite familiar with the Line
5. These constant regulatory and political attacks on Line 5, they
create risk in the marketplace. People start to wonder what is
next?
Mr. UPTON. Well, can you imagine—for the folks that don’t know
about Line 5, this is a line that connects the upper peninsula with
the lower peninsula of Michigan. And if—and that line needs to be
replaced, there is no question about that. It was built in the late
1950’s, I think it was, 60-some years ago. But I can’t imagine the
impact on gas prices in the Midwest if that line was simply cutoff,
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and not replaced, in terms of the impact at that marathon refinery
in southeast Michigan.
Mr. PUGLIARESI. Independent estimates show shutting down that
line would increase consumer costs by $58 billion.
Mr. UPTON. Yes, it is something else.
Mr. PUGLIARESI. We can do more for the fuel supply. We should
try to get a more national standard for fuel specs.
Mr. UPTON. Let me ask you one more question in my remaining
15 seconds or so.
Microchips. You know, we have got legislation that passed the
Senate big time more than a year ago. Does this have an impact
on energy? Are you able to get something like this back through
so we can actually build it ourselves versus relying on China?
Mr. PUGLIARESI. Absolutely. A reliable supply of microchips adds
a lot to the efficiency of the—of our entire production process: all
the inputs into petroleum production, all the inputs into industrial
production. So it is a very important supply chain issue.
Mr. UPTON. I yield back. Thank you, Mr. Chairman.
Mr. MCNERNEY. The gentleman yields back. The Chair now rec-
ognizes Mr. Pallone, full committee chair, for 5 minutes to ask
questions.
Mr. PALLONE. Thank you, Chairman McNerney. I wanted to start
with Mr. DeLaski, and I have got three separate questions here, so
maybe a minute or so for each of you to respond, if possible.
So, Mr. DeLaski, Representative Dingell’s bill, H.R. 7962, con-
tains provisions for water heater demand response requirements.
Demand response, as I understand, is an important tool to lower
consumer bills, fight climate change, and address grid resilience
and reliability. So could you talk to us about a minute about the
importance of demand response, and especially as we face more fre-
quent weather events, extreme weather events that place a lot of
stress on the grid? How can demand response help with emergency
events and ensure grid stability?
[Pause.]
Mr. PALLONE. I don’t know if he heard me.
Mr. DELASKI. Demand response is an incredibly important re-
source for ensuring grid stability.
As we—as the peak—as peak demand goes up and that hap-
pening as—on a hot weather event, that strains the power grid. It
can lead to outages as we faced risk of this summer
[inaudible] during this hearing. It also drives up costs enor-
mously. That is the most expensive power, is the marginal power,
however it is generated.
Demand response allows market to move that demand to another
time. And water heaters are a natural battery. Why not use that
battery to charge up that water heater with hot water when power
is cheap, and when it is produced by clean resources? That is what
demand response programs can do.
This bill would make those programs more possible. It doesn’t re-
quire them. It doesn’t mandate them. It simply makes them more
possible by allowing for the Department to consider setting demand
response requirements for water heaters, as are manufactured by
companies such as A.O. Smith.
Mr. PALLONE. Well, thank you. Let me go to Mr. Frias.
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The Tribal Energy Loan Guarantee Program, while well-inten-
tioned, has not guaranteed a single loan in its 17-year history. We
know that. So can you describe for us again in about a minute or
so the potential importance of this program, why it hasn’t delivered
on the promise, and whether you think the changes proposed in the
Tribal Energy Investment Act will ensure that tribes finally have
access to energy project financing?
[Pause.]
VOICE. Microphone.
Mr. FRIAS. Apologies. Thank you for the question, Chairman Pal-
lone. And it is a fair question.
Looking back at the history of the tribal program, though, it was
authorized in 2005, but it was not appropriated for until 2017. And
the first solicitation did not go out until 2018. It was making good
progress in Indian country, and then the pandemic hits.
You know, and by comparison, I would say that the NIGC took
three or four years, National Indian Gaming Commission, to have
regulations and be set up and to be going and working to regulate
Indian gaming. So a year for them to get going, once they had staff
and funds, is a pretty good turnaround.
With many tribes working remotely or shifting funds to address
the impacts of the pandemic, it is understandable that the program
has faced delays in the past several years.
I can tell you that, since I came on as executive director of
NAFOA in July of last year, that we have seen strong interest from
tribes about this program, interest in meeting with DoE, LPO, the
Office of Indian Energy, specifically at our conferences, where they
are speaking on panels, specifically our spring conference in Se-
attle, to talk about energy programs. There is interest in energy
programs in Indian country.
And one of the great things about this program is that it is tech-
nology agnostic, right? Whether it is extraction, whether it is re-
newable, the program will work to find it. And it addresses a crit-
ical problem in Indian country, not just for energy development,
but for economic development across the board, and that is access
to capital.
And so this program is important to Indian Country. You know,
without the pandemic, I think we wouldn’t see the history you are
addressing there.
Mr. PALLONE. Just quickly, Dr. Mulvaney—I am talking now
about H.R. 1599, the Securing America’s Critical Minerals Supply
Act—does that meet the standards that we want to see for sup-
porting domestic critical minerals supply chains?
Are there any changes to the bill that—so it does not inadvert-
ently contribute to harmful mining practices?
And what changes do you think must be made to guarantee the
bill truly supports clean energy production, if you will?
Dr. MULVANEY. I think there could be more specificity about—
around what energy, minerals, or critical minerals are being sup-
ported. I think there are, you know, ones that need more attention
than others.
There also could be more language around decarbonization and
low carbon energy systems that help define that, as well.
Mr. PALLONE. Thank you, Mr. Chairman.
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Mr. MCNERNEY. The gentleman yields back. The Chair now rec-
ognizes Mrs. Rodgers for—full committee ranking member, for 5
minutes to ask questions.
Mrs. RODGERS. Thank you, Mr. Chairman.
First and foremost, I am a mom. We recently remodeled my
kitchen, our kitchen. And I didn’t like my choices of dishwashers.
And today, because of what was available, we wash most of our
dishes by hand. But I want to get back to some of my questions
that I think are really important for energy reliability and afford-
ability.
Mr. Pugliaresi, I wanted to thank you for being—returning to the
committee. I appreciate your testimony. Last year you testified in
front of our committee, and you warned—you said that it was im-
portant for us to look to the example of Germany and their ap-
proach in imposing various top-down policy dictates, shutting down
certain energy sources, and the result of being more dependent
upon Russia. You noted that spiking energy costs there and else-
where were a warning for us, as U.S. policymakers, and that was
months before Russia invaded Ukraine.
Americans now see the risk and the—and we see the impact on
reliability and affordability. In the United States there has been an
unrelenting drive to shut down fossil energy with weather-depend-
ent wind and solar. Do you think the policy debate over this rush-
to-green movement would benefit from authoritative information on
what is necessary to secure energy resources, including critical
minerals?
Mr. PUGLIARESI. Absolutely. We need a much better under-
standing of the risks.
By the way, Germany has now fired up its major coal plants.
And from the folks we talk to there, their climate program is de-
layed by at least a decade.
Mrs. RODGERS. So in the late 1970’s, the Department of Energy
was organized as a cabinet agency to oversee national energy pol-
icy, and specifically address energy supply emergencies. H.R. 1599
provides a new function in the Department’s core statute to evalu-
ate energy resource vulnerabilities, both for critical materials of re-
newables and for traditional energy.
How do you think that this might be useful in putting energy se-
curity back at the center of our debate?
Mr. PUGLIARESI. Right. If we move to a set of systems where we
are reliant on these critical materials and minerals, we are particu-
larly reliant on foreign sources that are not necessarily friendly, ac-
tually might be quite hostile to the United States. We need a care-
ful assessment of what that means to our energy security and the
reliability of our energy complex.
Mrs. RODGERS. Thank you. So—and we hear from our colleagues
on the other side of the aisle and the Administration that a move
to renewable energy will reduce energy price volatility, which we
are all experiencing at the gas pump these days. Is the answer to
record high gas prices to increase dependance on critical minerals
and materials for renewable energy?
Mr. PUGLIARESI. It is very difficult to hide from the volatility of
any commodity. The way we—on our traditional energy complex
is—we had a large strategic petroleum reserve. We had an expan-
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sive program to expand U.S. oil and gas production, diversified pro-
duction, not just around the North America, but around the world.
These are the features that add to your energy security.
Mrs. RODGERS. Thank you, thank you.
Mr. Lieberman, I appreciate your testimony. One of the questions
I have about the legislation amending the weatherization program
concerns taxpayer stewardship. When Congress reauthorized the
program in 2020, it allowed for a limited program to help ready
homes for weatherization with a sunset and safeguards, such as a
minimum investment to savings ratios. We have not had enough
time to evaluate the program yet in the bill before us today.
But the sunset is eliminated. Minimum investment to savings ra-
tios is eliminated, and the whole—a new program is added. Do you
think this reflects careful spending of taxpayer dollars?
Mr. LIEBERMAN. When I look at this new bill, to me it looks like
they are clutching at straws, looking for rationales, for more money
that don’t really make a lot of sense to me, that we have to spend
money now on houses to get them ready for spending more money
later on. This seems kind of a reach. And the weatherization pro-
gram is already very heavily funded.
I think it makes a lot of sense to see what we are getting for the
money that has already been allocated before we throw more that
way.
Mrs. RODGERS. Thank you. Mr. Pugliaresi noted that behind
these drives to fund electrification programs, it actually increases
high—increases electricity rates, and it increases the burden on the
poor than—it disproportionately impacts the poor. Do you think
Congress should evaluate risk of expanding Federal programs that
will raise electricity on low-income families and workers?
And I have expired my time.
Mr. PUGLIARESI. I think energy poverty should always be a front
burner issue whenever energy policy, climate policy is being dis-
cussed.
Mrs. RODGERS. Yes. Thank——
Mr. PUGLIARESI. We are already seeing energy price increases
more than expected.
Mrs. RODGERS. OK, thank you. Thank you. Let’s stay focused on
reliability and affordability.
I yield back.
Mr. MCNERNEY. The gentlelady yields back. The Chair now rec-
ognizes the gentleman from California, Mr. Peters, for 5 minutes
to ask questions.
Mr. PETERS. Thank you, Mr. Chairman, and thank you, Ranking
Member Upton.
First I would like to discuss one of the bills before us today, H.R.
8053, the Guaranteeing Resilient Installations for Defense Act, or
GRID Act. I am happy to be discussing that today. I worked on—
pretty hard on that over the last two years, and I want to thank
the committee leadership and staff for working with my office to
find a path forward on this important piece of legislation.
As many of you know, my district in San Diego is host—is proud
to host one of the largest military footprints in the country. One
facility in my district, Marine Corps Air Station Miramar, is pio-
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neering the Department of Defense’s investments in the adoption
of renewable energy and resilient energy infrastructure.
Miramar’s collaboration with relevant stakeholders and staff has
culminated in the design of one of the most innovative microgrids
in the Department of Defense. The project constructed a power
plant with both diesel and natural gas generation to supplement
existing landfill gas and solar power.
Also, the station built an energy and water operations center to
manage the microgrid and other utility control systems at
Miramar.
These capabilities have already demonstrated their value to the
local community, as well. In the summer of 2020 the microgrid was
used to assist local communities by preventing rolling blackouts
during a heat wave, proving its utility on a larger scale. I am con-
fident this experience informed the written testimony provided by
the Department of Energy today when it stated that this bill
would, ‘‘address the significant security disadvantages for facilities
located throughout the United States.’‘
The microgrid at MCAS Miramar enables the installation to use
onsite renewable resources and power generation to supply its crit-
ical base loads when utility power is not available. And when the
microgrid system is grid-connected and utility services are avail-
able, the system reduces costs for the base.
The air station’s success incorporating renewable energy solu-
tions into its electric grid provides proof of concept for the problem
the GRID Act solves. It provides the Secretary of Energy, in coordi-
nation with the Department of Defense, to enter into contracts and
agreements to improve the resilience of defense critical electric in-
frastructure, and reduce the vulnerability of critical defense facili-
ties to the disruption of the supply of electric energy to those facili-
ties.
I wanted to ask Dr. Mulvaney. In your testimony you note how
the GRID Act enhances national security. Can you elaborate on
how you believe investments in the resilience of defense critical in-
frastructure and possible investments in local electricity infrastruc-
ture improves national security?
Dr. MULVANEY. Yes. You know, I spent time looking at issues re-
lated to ratepayer, and I am very sensitive to cost issues. So, you
know, it was nice to see in that bill that the—as proposed, that the
Department of—or at least the Federal Government could poten-
tially be investing in local communities to enhance grid resilience.
We have quite—you know, thinking particularly from the Cali-
fornia perspective, we have quite big challenges on our plate in the
State, with wildfires and moving power to where it needs to be on
certain days because of those wildfires.
So I think making those investments and making sure that the
lights stay on as consistently as possible are really key to national
security. And they help the rural communities that also live in and
around these bases also keep the lights on, which is, I think, criti-
cally important for national security and human well-being.
Mr. PETERS. Maybe the benefits to an average household from
that kind of strategy.
Dr. MULVANEY. I am sorry. Could you repeat one more time?
87
Mr. PETERS. Elaborate a little bit more on the benefits to an av-
erage household of that kind of strategy.
Dr. MULVANEY. Well, electricity costs are—you know, in Cali-
fornia—are some of the highest in the country. And having invest-
ments not be rate-based by the utility, but instead coming from
outside will, I think, help lower those bills, or keep them where
they are at, keep them from increasing, which—you know, elec-
tricity infrastructure is expensive. And we have a very old elec-
tricity system that we have connected all of us together with, and
have, you know, given us so much benefit. But it is time for us to
start upgrading it, and modernizing it, and giving us the ability to,
you know, isolate parts of the electric grid, for example, where
these power outages are.
So that would be another benefit to these communities, is that
they actually are able to go through these hot days we just had.
For example, in the Santa Cruz mountains, where—near where I
live, we had—the whole Stanford campus was down on power. It
was 100 degrees yesterday, and it was because of a relatively small
wildfire going right in and around the transmission lines. So, you
know, we got to reinvest here.
Mr. PETERS. Thank you, Dr. Mulvaney. I appreciate it.
And I yield back. Thank you.
Mr. MCNERNEY. The gentleman yields back. The Chair now rec-
ognizes the gentleman from Texas, Dr. Burgess, for 5 minutes for
his questions.
Mr. BURGESS. Thank you, Chairman.
And Mr. Pugliaresi, let me just ask you a couple of questions. We
are doing a hearing today. We are kind of in the middle of an en-
ergy crisis. A lot of people don’t understand why we are in the mid-
dle of an energy crisis. Two years ago this was not a problem.
Today it is a serious problem. It is hard to tell from the bills that
we have in front of us that we are taking this seriously, and we
don’t have—as has been pointed out by Ranking Member Upton—
we don’t have the Department of Energy here, which is really a
shame, because we should be able to ask them questions.
But what is your opinion of the bills that we are considering
today? Are they going to be able to address this emergent crisis
that we have in energy in this country?
Mr. PUGLIARESI. Many of these bills, particularly—well, I guess,
1599 can be very helpful in addressing problems that will emerge
over time. But this is not the critical problem facing the country.
We are not going to move through a transition as many people ex-
pect.
Fossil fuels are embedded in the U.S. and the world economy.
They come with a lot of favorable characteristics, particularly the
density and the cost effectiveness of their use. And so there will
be—it will be very difficult to do a rapid transition. These fuels are
going to be with us for years. Just how they end up costing us as
a country is going to depend a lot on government policy. And if we
have a policy that seems to think that we can stop the production
of oil and gas before the alternatives are cost effectively ready, we
are going to be in a lot of hurt.
Mr. BURGESS. Well, I think we are seeing that, as being evidence,
as you pointed out, I think, on your slide, that some of us are in-
88
convenienced, but some people are devastated by the economic ef-
fects of this ill-considered rapid transition. It is almost as if, rather
than scientific thinking, it was magical thinking. We can now get
our energy from different sources without doing the hard work and
making the investments along the way.
Mr. PUGLIARESI. I couldn’t agree more. I mean, we just did some
work the other day on biogas, just biogas for electric generation. In
order to meet the goals of 2050 under net zero, we are going to
have to take what we now dedicate, which is about, in terms of
land mass for bioenergy, for power, the land mass of France, and
add to it the land mass of Mexico.
These kinds of requirements are just enormous, and they are
going to take decades and decades to figure out the best way to
proceed. The notion that we can do this quickly, in my view, is not
just aspirational. It is somewhat delusional.
Mr. BURGESS. Well, and I wasn’t going to go here, but since you
brought up the word ‘‘delusional,’‘ it is delusional to think that you
can turn everything off in an industry as complex as the traditional
energy markets and then say, oh, gosh, I made a mistake, just kid-
ding, turn it all back on. It doesn’t work like that. These invest-
ments take time. They are capital intensive. And right now you
don’t have the economic climate that is willing to make these long-
term investments when the Federal Government has acted in the
way it has.
Mr. PUGLIARESI. It is a serious problem, and we are going to
have to rethink it.
Mr. BURGESS. Mr. Lieberman, I was so grateful you mentioned
the point at which, on this committee, the consideration was we are
running out of natural gas. The Energy Policy Act of 2005 was
predicated on the fact that we have to import natural gas from the
North Sea, because we didn’t have enough, we were running out
of feedstock for fertilizer, and how policies that really were devel-
oped in this committee—so we are capable of that type of deep
thinking—policies developed in this committee actually led to an
abundance of natural gas after the fracking and the shale revolu-
tion.
So it is disconcerting to see people willing to absolutely discount
what had worked when we knew we were getting into trouble, as
you pointed out earlier, in the last decade, and then to completely
undo it with no thought from where we backfill this supply.
Mr. LIEBERMAN. Absolutely. The transition when I was on this
committee was incredible. There was bipartisan concern that Amer-
ica was running out of oil and natural gas. Along comes the shale
revolution, and some of the changes in the 2005 energy bill facili-
tated that to an unexpected abundance. Now we are seeing that
abundance under threat.
One thing that Mr. Pugliaresi mentioned was the tremendous
amount of natural gas bottled up in Appalachia, just a couple of
states away from states like New York and into New England that
desperately need it. But the infrastructure isn’t there. Most of the
bills today deal with giving the Department of Energy more regu-
latory authority and more spending authority. That is not what we
need. We need BTUs being made in America and being shipped to
consumers.
89
Mr. BURGESS. I couldn’t agree more. So they don’t have to buy
them from Russia, absolutely.
Thank you, Mr. Chairman. I will yield back.
Mr. MCNERNEY. The gentleman yields back. The Chair now rec-
ognizes the gentleman from Pennsylvania, Mr. Doyle, for 5 minutes
to ask questions.
Mr. DOYLE. Well, thank you, Chair, and also to Ranking Member
Upton for holding this important hearing.
Reliable and affordable energy is critical to both families and
businesses, and the key to ensuring that we have reliable, stable,
and affordable energy is to invest in domestic, clean energy produc-
tion, domestic supply chains, advancing new technologies, and
making our grid, businesses, and homes more efficient.
I am also pleased that we are talking today about critical min-
erals and their supply chains today. It is vitally important that we
proactively work to establish a domestic supply chain for critical
minerals. If we are to build a cleaner energy future, and wish to
be truly energy independent, we must ensure that the entire
lifecycle of critical infrastructure is made here in the United States.
With that said, Dr. Mulvaney, can you expand on how we could
design a system at the Federal level, or incentivize better recycling
of critical materials?
Dr. MULVANEY. Well, I think, in general, with a lot of these elec-
tronic products, they are not prohibited from going—entering into
landfills, for example. We don’t have national electronics recycling
policy. We have hazardous waste policy.
But I think if we were to have a comprehensive program like
some states do in recovering all electronic products, or trying to do
what they can with that, I think that that could go a long way to
augmenting the supplies that we are going to need.
Mr. DOYLE. You know, a second important piece of this puzzle
will be developing new materials to replace rare, critical materials.
Can you talk about how we can help companies who have innova-
tive technologies get into the market?
Dr. MULVANEY. That is a great question, and I am not sure I
have the full set of solutions there. But I think that we need to re-
ward companies that are being more material use efficient.
So for example, solar panel over the last ten years uses ten times
less silver in it than it did a decade ago. And that is because silver
is expensive. So companies have that internal motivation. But
imagine what the savings would be if we started having a system
where we recognized that, you know, companies that could avoid
silver all together, for example, would be rewarded in the market-
place. And I am not sure what the specifics of that would be, but
that, I think, is the general concept there, is to reward the most
materials innovative companies that are making new products.
Mr. DOYLE. Thank you. You know, weatherization can have a
large impact for individual families, both in the short and long
term, and in the city of Pittsburgh that I represent we have a lot
of older homes, and the utility bills for families can end up taking
a large percentage of their income through no fault of their own,
but because they have a leaky house.
So, Mr. DeLaski, can you expand on the importance of the
Weatherization Readiness Fund?
90
Mr. DELASKI. Absolutely. Based on data from programs around
the country, local programs like the program in Pittsburgh and oth-
ers, and cities and rural areas around the country, about one in
five households, the weatherization professionals go into the home,
and they can’t do their work because the home is in such disrepair
that if they were to do insulation or ceiling, it could be damaged
right away. Say you have a hole in the roof, say there is rotting
floorboards. So one in five homes has—are in that State of dis-
repair, where you can’t provide this service. And, of course, these
are the homes occupied by the lowest income residents of these
areas.
Just to tell, you know, one story that we came up with—this is
from Aberdeen, Washington—this is a home where a partially dis-
abled man, an elderly—a senior citizen, was deferred from weath-
erization because of extensive rot in the floor. And the State pro-
gram helped him repair these issues in his floor, and then the con-
tractor, the weatherization contractor, could then come in and do
the weatherization job. And as a result, his annual heating bill was
reduced to $700 a year. This is a home built in 1912.
This happens time and time again for the program, so it is really
critical that programs be able to do the basic repairs so they—you
can go ahead and insulate. You can go ahead and do the weather-
ization that still has to be cost-effective. It still has to be cost effec-
tive to deliver those services. So it is really important to be able
to do the repairs.
Mr. DOYLE. Thank you.
Mr. Chairman, I yield back.
Mr. MCNERNEY. The gentleman yields. The Chair now recognizes
the gentleman from Ohio, Mr. Latta, for 5 minutes for questions.
Mr. LATTA. Well, I thank my friend and the chairman for yield-
ing, and I also thank our witnesses for being with us today.
Mr. Pugliaresi, if I could start questions with you—and I have
got so many questions and so little time. You know, the first
chart—or one of the charts you showed us—figure two, which was
world production depends on fossil-based fertilizers. And this is
kind of an interesting chart, because my mom was raised on a
farm, my wife was raised on a family farm. And back in 1965 on
this chart is showing about—just a little over one billion people
being able to be fed, and where we are today. I look at that as in-
teresting, because in 1965 my grandfather was 65, and he was—
and so it is interesting to see where we have gone in that short pe-
riod of time.
And, you know, my concern is, when you look at these numbers
that you showed us, that three billion people, you know, are de-
pendent on—we are—you know, where we are, that if we don’t
have that fertilizer, depending on the eight billion with the mixed
diets, you know, what is going to happen if we don’t have these fer-
tilizers out there in the future?
Because, again, this is absolutely critical for survival of the popu-
lation.
Mr. PUGLIARESI. Yes, we are just going to—we are going to have
starvation and spiked prices. So I just don’t think it is going to
happen. I don’t think the—you know, the—particularly the devel-
91
oping world, they are not going to move to a system in which they
don’t use ammonia or, you know, fossil fuels to make fertilizer.
Now, the question is maybe you could do some of this with car-
bon capture and things like this, but the rising cost of this is likely
going to see resistance. These countries will—you know, I don’t
think the political leadership is going to permit them to not grow
food.
Mr. LATTA. Well, and again, because—you know, what we are
seeing with Ukraine this year with—they are not bringing out the
maybe 60, 65 percent of their crop, and then they got to get it out
to market.
But then, in another—your figure three shows the rising prices
because, again, that is going to affect everybody, not only in this
country, but around the world what the price is going to be, be-
cause a lot of people are saying, well, prices are up for farmers this
year, but the problem is going to be the cost of production is so
much higher than it was last year.
Mr. PUGLIARESI. Right, right, right.
Mr. LATTA. So, you know, it is—I think it is critical.
You know, again, another figure that you have was on—you
know, and it was brought up just a little bit by Mr. Doyle. But
when you are looking at, you know, rare earth minerals—this is
your figure four.
Mr. PUGLIARESI. Yes.
Mr. LATTA. And, you know, when we need these minerals, and
when you are thinking about especially where communist China is
in supplying rare earth minerals across the globe today, you know,
we are—but, you know, we talk about being able to recycle bat-
teries and things like that, but we have got to have these things
today.
So where do you see, in the near term—because, again, it is—
you know, we had testimony here. It might take ten years to get
a mine open in this country.
Mr. PUGLIARESI. At least.
Mr. LATTA. To be able to get these, if we could get the mine open.
Mr. PUGLIARESI. Yes, right.
Mr. LATTA. So what is your projection, when you look at these
numbers across your figures here, what is going to happen in the
near term?
Mr. PUGLIARESI. So I think the risk—one of the risks that we
have to understand that we face is that, if we try to transition too
quickly to these alternative technologies, we are going to substitute
an energy security situation in which we are actually relatively se-
cure if we take the right measures, to a set of circumstances in
which we will be relatively insecure. Because some of these folks
making these critical materials, unless we have supplies here at
home, are not friendly to the United States.
Mr. LATTA. Well, thank you.
Mr. Lieberman, you know, I introduced legislation a while back
that—you know, the discrepancies between energy standards based
on when a furnace, central air conditioner and heat pump is in-
stalled versus when these appliances are manufactured. Can you
talk about the problem of stranded inventory, and how regulations
can better be tailored to avoid this problem?
92
Mr. LIEBERMAN. Yes. Some of the standards have the regulatory
deadline as the point at which the product must be installed, rath-
er than a drop dead deadline, after which you can’t manufacture
a certain product. And when the installation date is the deadline,
that means some legally manufactured air conditioners or other
equipment can no longer be installed. And that means that, if it
is at a warehouse, if it is at a retailer, it is no longer legal, and
so you have stranded inventory.
So I do like the idea of moving away from using the installation
date as the deadline. Again, many of these wholesalers, retailers
are small businesses. They are struggling with supply chain issues,
as well. We want to make sure they are not stuck with inventory
that they cannot sell.
I would point out that we need to be more broad about this be-
cause DoE regulations are just part of the story. There is EPA reg-
ulations, as well, that can create the risk of stranded inventory. So
I am familiar with your bill, we just—we need to make sure that
it is comprehensive.
I would make one point that one of the reasons for using the in-
stallation date is to prevent a run on the older models before the
new models take over, which is sort of an indication that con-
sumers wanted the older models. And that is worth keeping in
mind. We want DoE standards that don’t deprive consumers of
what they want.
Mr. LATTA. Well, thank you very much.
And Mr. Chairman, my time has expired, and I yield back.
Mr. MCNERNEY. The gentleman yields. The Chair now recognizes
the gentleman from New York, Mr. Tonko, for 5 minutes to ask
questions.
Mr. TONKO. Thank you, Mr. Chair. I thank you for holding this
hearing and including H.R. 7947, the Weatherization Enhancement
and Readiness Act. I also thank you for your commitment to pro-
tect and strengthen DoE’s Weatherization Assistance Program.
This program is essential to supporting low-income households,
especially during a time of increased energy prices. But we know
even before these recent energy increases, many Americans were
struggling to pay their bills, and low-income families have a dis-
proportionate energy burden, a higher percentage of their income
being used to pay their energy bills. As many as one in five Ameri-
cans reported reducing or foregoing necessities such as food or
medicine to pay an energy bill. That is unacceptable.
So the Weatherization Assistance Program plays a critical role in
helping these families, and it works. Homes receiving assistance
save an average of $372 every year. But despite this great work,
we know the program can be improved.
I want to focus on two important provisions of H.R. 7947.
First, the bill would raise the average cost per dwelling unit from
$8,000 for Fiscal Year 2022 to $12,000. This is the limit on how
much assistance a home can receive. The ACPU has not been ad-
justed at a rate to keep up with recent increases in the cost of
building materials, restricting the services households receive, and
putting pressure on WAP crews’ wages, which are included in the
ACPU calculation.
93
So Mr. DeLaski, can you help us understand why at this moment
an increase in the average cost per unit is indeed appropriate for
this program?
Mr. DELASKI. It is urgently needed for this program. With the in-
crease in wages that we are seeing across the economy, this is af-
fecting the programs and their ability to be able to retain—to hire
and to retain workers to deliver weatherization services. These are
skilled people who can move on to other jobs if there is not—they
are being paid adequately to do weatherization services. So the rise
in wages is one factor.
Another is the cost of materials. I think this committee is famil-
iar with—that the cost of materials are going up, and the construc-
tion industry—of lumber. These costs and other inputs, these costs
are going up. And the program hasn’t kept pace with those—with
the changes in costs to deliver these services.
In addition, I would add that the homes that are in the worst—
have the greatest needs, programs aren’t able to provide necessary
services with the caps that exist today. So this doesn’t—increasing
the cap is absolutely essential to being able to provide services to
homes.
I would also add that rural homes can be expensive to serve, as
well, because the technicians, the service providers, have to travel
further to provide those services. So for, you know, substandard
housing in the rural parts of the country, rural districts, it is super
important to increase this cap.
Mr. TONKO. I thank you, sir. And second, many Americans who—
would benefit from the program, but most are unable to receive as-
sistance due to their homes, as you indicated, being in such poor
conditions. These homes are passed over by the program. In some
areas, this might be as many as 20 percent of eligible homes. So,
Mr. DeLaski, do you believe it undermines the goals of the Weath-
erization Assistance Program that families are living in the worst
conditions have the greatest difficulties accessing the assistance?
Mr. DELASKI. Yes, it is ironic, and it is—it undercuts the very
purpose of the program, that people who most need the services
can access it.
The program provides tremendous benefits to the homes that are
able to be—to those families. But for the one in five, who they—
they come into the home, they want to provide the service, they as-
sess that there is the need, but then, because of problems like a
hole in the roof, or because of rot, or because of mold, they can’t
do the insulation, they can’t do the ceiling. And these are the peo-
ple who most need those services, because they live in the most
substandard housing. And those are homes in urban
[inaudible], that are homes in rural areas. There are homes
throughout the country, and these are the families who we most
need to be able to serve with the Weatherization Program. And the
way the program is structured today, these houses are deferred. In
other words, they are not served. And that is a huge problem.
Mr. TONKO. While the dedicated readiness funding, which may
support structural improvements like bad roofs, and addressing en-
vironmental hazards like mold, and help lead to better outcomes,
certainly for the traditional weatherization program—and provide
94
hope for those households that have been passed by. So I appre-
ciate your comments.
And with that, Mr. Chair, I yield back.
Mr. MCNERNEY. The gentleman yields back. The Chair now rec-
ognizes the gentleman from West Virginia, Mr. McKinley, for 5
minutes to ask questions.
Mr. MCKINLEY. Thank you, Mr. Chairman. Well, here we go
again. After spending a year and a half on partisan messaging bills
like the Clean Future Act and Build Back Better, Pelosi seems to
be trying to avoid losses in this fall’s general election by trying to
appear bipartisan.
Look, as Chairman Upton said a minute ago, inflation is at a 40-
year high. Gas prices are over $6 a gallon. The opioid crisis con-
tinues to grow exponentially, and frustrated Americans are increas-
ingly turning to violence. So instead of actually working on those
matters, this majority is nibbling around the edges.
And last night the President announced his support for a three-
month moratorium on the Federal gas tax. Really? There is—this
is nothing but a politically motivated gesture. Does anyone really
expect the trucking companies to pass on those savings to the con-
sumers? And with this suspension, a typical motorist will probably
only save 7 to $10, 7 to $15 a month. That is about the price of
a pack of cigarettes, or a couple of gallons of milk.
But let’s return to today’s hearing, because that is what they
want to talk about.
These bills are well intended. I understand that. But, Mr. Chair-
man, these bills will not increase our domestic infrastructure, en-
ergy infrastructure, and its production, and lowering prices. This
committee should be talking about issues that matter to Americans
now.
So, Mr. Pugliaresi, if I could ask you a couple of questions, if you
were his adviser, would you tell the President or would you be ad-
vising the President to suspend the gas tax for three months?
Mr. PUGLIARESI. No. I think, as President Obama said, it is a
gimmick.
[Laughter.]
Mr. MCKINLEY. Thank you. And according to Reuters, countries
around the world are increasingly using—reverting back to use of
coal, as you mentioned in your remarks, for power generation be-
cause it is cost effective and avoids rising gas prices, natural gas
prices. So if other nations are doing this, continuing to use coal—
and let’s call it clean coal—would energy reliability in the United
States benefit by our using clean coal technology?
Mr. PUGLIARESI. Absolutely. We should have a very robust and
diversified energy source for generating power and other uses for
energy throughout the national economy.
Mr. MCKINLEY. Thank you.
And Mr. Lieberman, if you could just do—if you could just pass
the magic wand that did one thing to lower gas prices at the pump,
what would that be?
Mr. LIEBERMAN. I would try to travel back in time, and try to get
candidate Joe Biden to not say he wants to kill off the domestic oil
industry. I mean, talk about a chilling effect. And we have seen
that ever since.
95
One can complain that the oil industry, the refiners aren’t invest-
ing enough. But can you really blame them, when the commander
in chief is using that kind of extinction rhetoric, or at least was
until prices got too high?
Plus, as we know, the President has made good on those prom-
ises, starting from day one.
One point I would also make is that, sure, Keystone XL pipeline,
drilling in ANWR these would take time to come online. But a
number of economists believe that expectations of future supplies
has a beneficial effect on current prices. And then the alternative
expectations of future supplies being cracked down upon because of
Federal policy has an adverse effect on current prices.
So I think there is a lot we could have done that would have low-
ered gas prices much more than the 18.4 cents per gallon Federal
tax.
Mr. MCKINLEY. Thank you.
Back to you, Mr. Pugliaresi. What would you do if you could just
pass one thing? What would be the top priority to lower gasoline
prices?
Mr. PUGLIARESI. Well, in the near term I would take the renew-
able fuel standard down to ten percent. I could get $0.30 right
there. I would ask the Administration to take emergency proce-
dures to give us a national RVP standard for gasoline. I would
probably also repeal the Jones Act, at least temporarily, so crude
oil and products can move at low cost to—from where they are pro-
duced to where they are needed within the United States.
These are all very difficult things to do. I fully understand that.
Mr. MCKINLEY. Thank you.
Mr. Chairman, I yield back the balance of my time.
Mr. MCNERNEY. The gentleman yields back. The Chair now rec-
ognizes the gentlewoman from Washington State, Ms. Schrier, for
her questions.
Ms. SCHRIER. Thank you, Mr. Chairman. Mr.—and thank you to
our witnesses.
Mr. Frias, under the current statute, the Tribal Energy Loan
Guarantee Program permits the Department of Energy to guar-
antee up to 90 percent of a private sector loan. And I wanted to
dive into that a little bit.
The first question is just has the private sector been willing to
finance tribal energy projects?
Mr. FRIAS. Thank you. You know, in Indian country we experi-
ence difficulty accessing capital across the board. It is—as I men-
tioned in my comments, you know, the joint NPR about the Com-
munity Reinvestment Act addresses some of the difficulties we
have in bringing institutions—bringing capital into Indian country.
I believe one of the members talked about how capital-intensive en-
ergy programs are. And so it is difficult for us to get capital in In-
dian country. Increasing it is a constant struggle.
And, you know, studies have shown that institutions are reluc-
tant to lend for economic development programs where they don’t
have a pre-existing relationship. The tribes that will have those
pre-existing relationships are tribes that perhaps have built gam-
ing institutions or other forms of economic development. But the
reality is the tribes that are most in need of economic development
96
are those that don’t have it now, and perhaps are not well situated
to be involved in the gaming industry.
Ms. SCHRIER. And do you have any sense of what sorts of energy
projects tribes of—various tribes were looking to finance? Just for
some examples.
Mr. FRIAS. You know, again, as I said in my testimony, we are
agnostic about the technology at NAFOA, and I think you will find
tribes that are on all sides. You will find tribes that are very inter-
ested in renewable energy. You will find tribes that are very inter-
ested in doing extraction. And that is one of the strengths, I think,
of this program, is that it is technology agnostic. It doesn’t favor
one over the other, but allows tribes to have that authority in their
own sovereign hands, tribal leaders to be able to make the decision
for what works best for their community.
And so we hear interest in a broad array of different projects. I
think, but for the pandemic and the effect that it had, you know,
not just in Indian country, but in the country as a whole, we would
have seen further progress.
Ms. SCHRIER. And are these energy production, or can this also
be energy distribution projects? Because the ones you are talking
about sound like they are really highly capital-intensive, if they are
energy production.
Mr. FRIAS. You know, I believe it is in favor of energy production.
Ms. SCHRIER. OK.
Mr. FRIAS. But I will have to go back and take another look and
make sure. If I can get back to you with a——
Ms. SCHRIER. That is OK.
Mr. FRIAS [continuing]. With a firm answer on that.
Ms. SCHRIER. Thank you. No, I am trying to work through, you
know, why this loan program is—has really failed Indian country
to date. And it sounds like that is the reason that having this new
system, where we don’t have just a loan guarantee, but direct loans
from the Department of Energy will make such a difference for In-
dian country.
And then can—I think that may be the end of my question. I
just—I mostly wanted to kind of get you to point out what the fail-
ing was with the prior system, and how this could make things bet-
ter. And I think you have explained that this will allow for money
to flow to tribes more easily.
Is there anything else that you wanted to add to that?
Mr. FRIAS. Yes. If I could reemphasize, Congresswoman, you
know, funds weren’t appropriated for this program until 2017. So
while on paper it appears that the program has been around for
a long time, it was around without funds. And so the first solicita-
tion didn’t go out until 2018. And then 2020, the pandemic hits,
and we have this reallocation of funds in Indian country.
We are all looking at different things. Indian country was hit, I
think, in some ways harder than other parts of America, due to
multi-generational families and—multi-generational homes, I
mean, and other factors. And so, but for the impact of the pan-
demic, I think we would have seen further progress.
I think this change is really important, because it takes out a
really complicated extra step that we don’t necessarily need.
Ms. SCHRIER. Thank you, and I yield back.
97
Mr. MCNERNEY. The gentlewoman yields back. The Chair now
recognizes the gentleman from Virginia, Mr. Griffith, for 5 minutes
to ask questions.
Mr. GRIFFITH. Thank you very much, Mr. Chairman.
Mr. Lieberman, Mr. Pugliaresi, thank you for your responses to
my colleague, Mr. McKinley, in regard to what we could actually
do to lower the price of gasoline for consumers.
And I would have to agree that a number of those would work,
particularly the expectations, as you said, Mr. Lieberman. When
you have the President of the United States, first as a candidate
and then on day one saying we are not going to have any more
drilling, we are not going to do the Keystone XL pipeline, how can
you then expect those folks who normally would do the exploration,
the drilling, the investment in new equipment, new refineries?
As I understand it—and tell me if you have heard this, as well—
our refineries are actually operating at about 93 and 94 percent,
which is about as good as you can get. Is that your understanding,
too, Mr. Lieberman?
Mr. LIEBERMAN. Yes, it is. And one of the things refineries are
struggling with is CAF̋ greenhouse gas standards for vehicles that
will essentially require electric vehicles. So there is regulations
that would constrain the amount of gasoline that can be used in
the future effectively, and that raises questions about whether in-
vesting now in more capacity would be worth it.
Mr. GRIFFITH. Yes. And somebody used the term ‘‘delusional’‘
earlier, and I would concur with that, as well.
All right, that—let me switch gears, and let me go to something
different. Let’s talk about the weatherization.
Now, Mr. Lieberman, I like weatherization a little bit better than
you do, based on your earlier comments. But I am concerned about
this repair or reconstruction of a home before you get there. And
I know that the bill has on page four a limit average for average
cost per unit basis. But in some parts of the country—and that may
include parts of my district—if the home is in disrepair, you might
hit that average cost, based on prices in more expensive areas of
the country. The average cost might actually mean that you invest
more money in the home than the home is actually worth, even
after repairs.
Can you comment on that? Should we have something in there,
if we are going to do it—and I know you don’t like the program
that much, but if we are going to do it, shouldn’t we have some-
thing in there that says that it should be a percentage of what you
expect the home would be worth after you have done all this work
on it?
Mr. LIEBERMAN. Yes, I think that would be a good safeguard to
improve the bill.
I will say generally about the weatherization program—and this
is just anecdotal evidence—there is a fair amount of waste that
goes on. I think something less than 100 cents on the dollar has
been spent wisely. A lot has been spent on the program. One would
think that that much more wouldn’t be need needed to be spent if
the previous amounts were allocated more wisely.
I don’t know the specifics of your particular question.
Mr. GRIFFITH. Right.
98
Mr. LIEBERMAN. But again, I think, with the tremendous amount
of funds that weatherization is already getting, I think there ought
to be increased oversight.
Mr. GRIFFITH. Right. I agree with that.
H.R. 5292 on the agenda today is a common-sense bill. I support
that. It deals with making sure that, if somebody has gotten a DoE
loan in the past, that they—and they have defaulted, they can’t get
another one.
Do you think we should also say that for not only—Mr. Lieber-
man, not only for DoE loans, but for loans of any type from the
Federal Government, that if somebody has defaulted in the past
they shouldn’t be eligible for a new DoE loan? Yes or no?
Mr. LIEBERMAN. Yes.
Mr. GRIFFITH. OK. And then I want to move on to something
that I think is significant, and that is I think we probably also
ought to have civil penalties for Federal employees who knowingly
and willfully violate the law, because that is what I believe hap-
pened in the Solyndra situation. Everybody heard about the $527
million that was spent in Solyndra. That isn’t what got my goat.
My goat was the 95 million that was given to Solyndra subsequent
to their default on December 1st of 2010.
And when the code specifically says—I am reading right now
from the code—‘‘the obligation’‘—that would be the DoE loan—
‘‘shall be subject to the condition that the obligation is not subordi-
nate to other financing.’‘ And in that case, I believe that some par-
ties at DoE decided to subrogate the law, and disregard it because
the law clearly said after default there weren’t supposed to be any
more moneys.
They then came up with this plan to subordinate 75 million,
which cost the government, or cost the people 95 million to out-
siders. They did so with a series of emails back and forth. And one
of the requirements on default was that you talk to the Treasury
and the Department of Justice. When this scheme came forward
and they mentioned it to Treasury, Treasury actually sent an email
back at the time that said, ‘‘Hey, we don’t think you could do this.
Maybe you should check with the Department of Justice.’‘ But they
never checked with the Department of Justice. I suspect that is be-
cause they didn’t want to find out they weren’t allowed to do it,
and have somebody from Justice saying that.
Don’t you think a civil penalty added in there if somebody will-
fully and knowingly violates the Federal law passed by Congress,
don’t you think that would help improve the DoE program, as well?
Mr. LIEBERMAN. That would make for a better program than
without it.
Mr. GRIFFITH. Thank you, Mr. Chairman. I yield back.
Thank you, Mr. Lieberman and others.
Mr. MCNERNEY. The gentleman yields back. The Chair now rec-
ognizes the gentlewoman from California, Ms. Matsui, for 5 min-
utes to ask questions.
Ms. MATSUI. Thank you very much, Mr. Chairman. I want to
thank the witnesses for appearing today.
The Weatherization Enhancement and Readiness Act would also
make crucial improvements to the Weatherization Assistance Pro-
99
gram, helping more families lower their energy costs, while making
their homes more energy efficient.
In addition to the benefits that consumers will see on their bills,
weatherization and energy efficiency play an important part in our
fight and our efforts to fight climate change.
Mr. DeLaski, can you please elaborate on the climate benefits of
the Weatherization Enhancement and Readiness Act?
Mr. DeLaski?
Mr. DELASKI. Thank you for that question. Absolutely. You
know, saving energy in homes, whether it be through the weather-
ization program or other programs such as the Appliance Stand-
ards Program and others, are effective policies for reducing energy
use, and that helps to lower consumers’ utility bills. And where
power is being generated by—from fossil generation sources, that
helps to reduce climate change emissions.
Ms. MATSUI. OK.
Mr. DELASKI. The——
Ms. MATSUI. Can you please talk about how the Weatherization
Readiness Program proposed in the Weatherization Enhancement
and Readiness Act complements the Weatherization Assistance
Program? What gaps does this bill address?
Mr. DELASKI. Right. It addresses four important gaps.
One gap is that it raises the average cost per unit to $12,000, so
that you could actually do the projects that otherwise would be out-
side the scope of that cap.
The second thing it does is that it allows the program adminis-
trators, the weatherization—the local Weatherization Assistance
Programs to do basic repairs to homes that allow the weatheriza-
tion work to be done. Absent those basic repairs, often the weather-
ization can’t even be done.
Ms. MATSUI. OK.
Mr. DELASKI. Those are two of the ways that it improves it.
Ms. MATSUI. Sure. One of the bills before us today takes impor-
tant steps to modernize standards that govern water heaters,
which are one of the most—one of the largest energy uses in our
homes and businesses. By making simple updates, we can encour-
age more efficient and responsive technology, saving consumers
money and reducing our energy consumption. But we know other
outdated or inefficient consumer technology throughout our homes
is not keeping pace.
Mr. DeLaski, can you talk about the relationship between house-
hold appliances and consumer technology and our energy consump-
tion?
Moving forward, what options do we have to ensure our stand-
ards are keeping up with technological advancements?
Mr. DELASKI. One of the most important ways to make sure that
our—is for us to update the appliance standards administered by
the Department of Energy. The Department has a legal obligation
to review standards periodically to keep pace with technological
change.
And it is—the typical new refrigerator sold today uses 25 percent
as much as it did 20 years ago. It is huge technological progress,
and that progress is driven in large measure by increasing stand-
ards.
100
Ms. MATSUI. Sure.
Mr. DELASKI. That ensures all consumers, whether they buy an
entry-level unit or whether they are buying a deluxe unit, get a
level of performance that lowers their energy bill, and lowers the
emissions that result from using that appliance.
Ms. MATSUI. OK, thank you.
I have long believed that the investments we make in critical in-
frastructure not only supports our economy, but enhances our na-
tional security. This is especially true for the infrastructure within
this committee’s jurisdiction. Dr. Mulvaney, can you discuss the re-
lationship between local electricity infrastructures and national de-
fense?
And how can we balance the need for needed upgrades with a
cost burden on ratepayers?
[Pause.]
Ms. MATSUI. Dr. Mulvaney?
Dr. MULVANEY. Would you mind repeating that one more time?
I am sorry.
Ms. MATSUI. Oh. Can you discuss the relationship between local
electricity infrastructures and national defense?
And how can we balance the need for needed upgrades with the
cost burden on ratepayers?
Dr. MULVANEY. Yes. So a lot of our military infrastructures and
installations are, obviously, around—in rural communities, and
these are often—sometimes they could be co-ops, and not even
major parts of our major utilities in the State, and they can often
be burdened with very high bills.
And it sounds like, from the context for the bill, that these infra-
structure upgrades are needed for national security, to make sure
that, you know, these critical infrastructures are up to speed, in
terms of the most secure facilities, and that they have the latest
gear in there, and all that stuff. But that is expensive. And when
a co-op or a—even a utility has to build those infrastructures, the
ratepayers have to pay for that.
Ms. MATSUI. Right.
Dr. MULVANEY. So in terms of—so there is a couple of ways to
protect low-income customers. One is you have outside investment
help that, and that could be supported by the government. But you
could also have programs to protect low-income ratepayers. Like,
California has a law—has the California——
Ms. MATSUI. Thank you very much.
Dr. MULVANEY. —[inaudible] program that allows them to——
Ms. MATSUI. Dr. Mulvaney, I have run out of time.
Ms. SNYDER. Sorry.
Ms. MATSUI. Thank you, I yield back.
Ms. CASTOR [presiding]. The gentlewoman yields back.
Next up, Mr. Johnson, you are recognized for 5 minutes.
Mr. JOHNSON. Well, thank you, Madam Chairwoman. Well, here
we are, right in the middle of this preventable, in my opinion, in-
tentional energy crisis.
Five-dollar-a-gallon gasoline in rural Appalachian Ohio for my
constituents means having to choose between food, medicine, get-
ting to your job, taking the kids to school, or driving to take an el-
derly loved one for some hospital care. And what does President
101
Biden and his Administration have to say? Well, they say just go
out and buy an electric car, and join us in this—and I quote—in-
credible transition to green energy.
I mean, our Treasury Secretary actually agrees. She recently
said—and I quote—‘‘The critical thing is that we become more de-
pendent on the wind and the sun that are not subject to geo-
political influences.’‘ How ridiculous. Excuse me, Madam Secretary.
Mr. Pugliaresi, I can’t believe we need to clarify this, but can you
please explain how critical minerals and metals for solar panels
and batteries and the rare earths to make specialized magnets for
wind power generation and electric motors are very much subject
to geopolitical influences, not to mention subject to the whims of
our geopolitical adversaries?
Mr. PUGLIARESI. Well, until we develop domestic or more secure
supplies from reliable trading partners, we are going to find that
some of these—many of these critical materials and minerals are
sourced out of China, the Congo in Africa, and very, very unreliable
sources, which would be in a position to not only generate a great
deal of revenue from the sale of these products to the United
States, but also to withhold them or to extract wealth from us by
charging prices well above market levels.
Mr. JOHNSON. So basically, we are going to be making ourselves
more dependent on some of the worst people in the world.
Mr. PUGLIARESI. I believe, without the proper measures, we could
end up taking a position of relative energy security to one of energy
insecurity.
Mr. JOHNSON. Well, let me pivot for a moment to this water
heater legislation regarding so-called demand response technology,
which I think is better described as the capability to remotely con-
trol the American people technology.
I don’t know about you all, but my constituents would be ex-
tremely concerned if an outside entity—say the power company, or
the EPA, or the Department of Energy—at the push of a button
tells them, ‘‘Sorry, you have got to take cold showers today because
the grid is overloaded.’‘
Friends, the solution here is to make policies and implement poli-
cies that make electricity generation more affordable, more reliable,
and more abundant, not look at ways to micro manage household
energy use.
So, Mr. Lieberman, you mentioned it briefly in your testimony.
Can you describe to us the concept of—I quote—‘‘forced demand
response’‘?
And can you explain why, without effective guardrails—I mean,
could you see this expanding beyond water heaters to other home
appliances, and perhaps even electric vehicles?
Mr. LIEBERMAN. Well, yes. There are some very legitimate con-
cerns about privacy here.
What this program would do—essentially, it strikes me as trying
to make up for the intermittency of wind power by allowing extra
wind to be used to heat your water when it is available, or extra
solar. And that would require turning on the water heater at that
time. What strikes me is it is really getting away from the con-
sumer focus of the Energy Policy and Conservation Act, which is
102
supposed to save consumers money, and do so in a way that doesn’t
compromise any product performance features, reliability, choice.
The more I learn about this program, the more—maybe
cockamamie is too strong a word, but at least convoluted. I just
don’t believe that it could ever happen in a way that wouldn’t be
a lot of problems for consumers. And in any event, if any home-
owner wants to go along with this, more power to them. But we
need to prevent this from being mandated.
And, you know, in response to maybe the argument, well, this
doesn’t mandate it, it gives DoE the option of mandating it, well,
you know, maybe I would be impressed with that if this was my
first week in Washington. But we know that regulatory agencies al-
ways take every opportunity to expand their power. And so this
will mandate the demand response capability.
Mr. JOHNSON. Yes. Well, I thank you for your comments.
Madam Chair, I yield back. It is mind boggling to me that we
are even talking about something like this.
Mr. MCNERNEY [presiding]. The gentleman yields back?
Mr. JOHNSON. I yield back.
Mr. MCNERNEY. Thanks for the gender promotion.
Mr. JOHNSON. Sorry, I thought my colleague from Florida was
still——
Mr. UPTON. It is that new haircut.
Mr. JOHNSON. I didn’t even look over there.
Mr. UPTON. It was that new haircut. It was that new haircut of
his.
[Laughter.]
Mr. JOHNSON. That is all right.
Mr. MCNERNEY. The Chair now recognize the gentlewoman from
Florida, Ms. Castor, for 5 minutes to ask questions.
Ms. CASTOR. Well, thank you, Mr. Chairman, and thank you to
our witnesses for being here.
This is a very timely hearing, because we know that our neigh-
bors are really grappling right now with the higher cost of energy,
driven by Putin’s unprovoked war in Ukraine, the squeeze put on
by oil and gas companies because of America’s continued addiction
to oil. So we have got to invest in our energy infrastructure to
lower costs for families, and at the same time tackle the climate
crisis and protect our communities from the costly impacts of cli-
mate change that we can no longer avoid.
So we are making progress. Many of the bills we are discussing
today will help advance clean energy and lower cost to energy effi-
ciency, from equitable access for weatherization to expanding the
use of distributed energy sources for demand response for a more
flexible, innovative grid to ensuring the resilience of our military
installations.
I want to thank Representative Peters, especially, for the GRID
Act that is focused on innovation at DoD. You know, think about
how our national security is reliant on consistent energy, but to ful-
fill those critical defense and strategic missions we have got to en-
sure that energy supply to those bases is continuous and reliable.
I have a base in Tampa, MacDill Air Force Base, and we are very
concerned about, over time, the resilience of that base and energy
supply.
103
But let’s talk about a flexible grid with more renewable energy,
because more efficient electric space and water heaters will save
Americans money on their electric bills. We have the technology to
do this. I—some of these arguments are, like, from 20 years ago,
we can’t do this in America. We can do this. We have the innova-
tive technologies to do it.
So, Mr. DeLaski, help us understand how water heaters with de-
mand response could help facilitate a more flexible electric grid.
What is demand response? You have heard it criticized here today.
And why are water heaters well suited for it?
Mr. DELASKI. Thank you for the question. Water heaters are
very well suited for providing demand response services because, in
essence, they act as a battery. All of us—or most of us—have a
water heater in our home that has got 40 or 50 gallons of water
in it. We aren’t using that water on a continual basis. We can heat
it up when power is cheap, and we can reduce our bills tremen-
dously if we have that capability in our water heaters.
One thing I want to point out is that it is much cheaper to add
that capability at the point of manufacture than to retrofit it once
that water heater has been installed. For a utility to send a truck
out to someone’s home to retrofit a water heater is hundreds of dol-
lars. Doing it in a factory so that it comes equipped, so that cus-
tomer has the choice—they don’t have to join a demand response
program, but we want them to have the choice.
This bill gives the consumer the choice, if acted on by the De-
partment, if the Department takes advantage of the authority, it
would give consumers the choice to be able to participate in de-
mand response programs, if offered by their utility.
Ms. CASTOR. Mr. Greene, what do you think?
Mr. GREENE. Thank you, Congresswoman. To be very short and
efficient and candid here from a manufacturer’s standpoint, we
have been involved in both pilots, as well as DR programs with
water heating equipment for the better part of a decade. And while
these programs are nascent, they are all voluntary.
What we are really asking for, as manufacturers, as relates to
technology innovation, is standards that we all can meet. And just
having the water heater have the capability, and therefore giving
a consumer that may want to enter into a DR program the ability
to do so, for us it is all about business certainty and manufacturing
to a national standard versus bespoke standards that may be com-
ing into the future.
Ms. CASTOR. So innovation, lower energy bills for consumers, this
makes enormous sense. And I am a little confused to why our GOP
colleagues are criticizing this today, because still on their website
today they are highlighting our bipartisan work in 2015 to ensure
energy saving, grid-enabled water heaters continue to be manufac-
tured and sold, a solution to facilitate greater cooperation and save
money. So we need to move these bipartisan efforts forward, and
focus on real solutions to lowering consumers’ energy bills. I know
we can do it.
And I will yield back my time, thanks.
Mr. MCNERNEY. The gentlelady from Florida yields. The gen-
tleman from Indiana, Mr. Bucshon, is recognized for 5 minutes for
questions.
104
Mr. BUCSHON. Thank you, Mr. Chair. I am pleased we are com-
ing together today to discuss concrete actions we can take to help
bolster our energy infrastructure and deliver reliable, affordable,
and clean energy to our constituents. However, I must emphasize
my disappointment in the majority’s unwillingness to discuss some
of the most pressing issues facing my constituents and our con-
stituents on the energy front.
Last week gasoline prices climbed over $5 a gallon nationwide.
In my home State of Indiana, Hoosiers are paying, on average,
$5.11 per gallon for regular gasoline and over $6 per gallon for die-
sel.
My constituents are also facing the potential risk of rolling black-
outs this summer due to insufficient grid resource capacity. And
this isn’t my opinion. This is according to MISO, the Midcontinent
Independent System Operator, and also some utilities in the re-
gion.
Our constituents are hurting from the Biden Administration’s
ideologically motivated energy agenda that puts the goals of the
radical environmental groups above the needs of the American fam-
ilies. As has been said many times in this committee by my col-
leagues and I, this is a dangerous approach that will significantly
hamper our ability to reliably and affordably meet our energy
needs moving forward.
Some countries around the world are already experiencing dra-
matic reckonings resulting from such an approach that is being
proposed by the Administration, and are being forced to take dras-
tic action, literally, as we speak. For example, Germany, the Neth-
erlands, Italy, and Austria recently announced intentions to bring
back some coal-fired power plant generation due to their inability
to meet energy needs with intermittent renewables without Rus-
sian gas. Who would have thunk that the Russian gas would go
away?
You have to have capacity yourself. This may put them back at
the starting gate when it comes to decreasing their carbon emis-
sions and their climate goals over time. In fact, some politicians in
Germany are now discussing openly, publicly the possibility of
overturning the country’s 2017 ban on hydraulic fracturing, or
fracking, to increase the domestic supply of gas. Wow, what an
idea. We should think about that in some of our states here, in
America.
Why would America, with our own vast resources, follow down
the pathway we are witnessing in Europe? We are not trying to re-
invent the wheel here.
So Mr. Pugliaresi, when I questioned you before a joint hearing
of the Environmental and Energy Subcommittees last fall, you said
that we could affect prices if we ensure that our domestic oil and
gas industry remains efficient and produce at capacity. So prices
are continuing to rise. What are we missing out on here?
Mr. PUGLIARESI. I think part of the problem, of course, was that
the lockdowns, in my view, were excessive. And they resulted in a
lot of our supply chains being disrupted. So we had a real problem
coming out of the lockdowns.
But we also have a real problem on expectations, as Ben had spo-
ken about previously.
105
I would like to point out one thing. Recently, President Biden vis-
ited Japan. And the two——
Mr. BUCSHON. And I was just there, too, myself.
Mr. PUGLIARESI. Yes. Prime Minister Kishida and the President
issued a lot of joint statements. But when it came time to make
a joint statement on the importance of LNG exports and the impor-
tance of more investment in U.S. oil and gas, only Prime Minister
Kishida was on that statement. President Biden refused to join him
in calling for more investment in U.S. oil and gas.
We need to kind of change the dialog. These investments in oil
and gas production and infrastructure, they are long-term. They re-
quire regulatory certainty, and they require investment certainty.
And we don’t have that right now.
Mr. BUCSHON. Yes. I mean, on my recent trip to Japan with
some other members, bipartisan, the prime minister told us—and
his people told us the same thing—you know, when we were talk-
ing energy policy, they want to be partners, and they are com-
pletely dependent on imported energy, as you probably know. And
they want to be partners with us on LNG and other sources of en-
ergy. They are desperate to work with us on these issues.
Mr. PUGLIARESI. Absolutely.
Mr. BUCSHON. So the rolling blackouts looming in Indiana and
elsewhere across the country are there. I mean, it is also for you.
How can we increase grid resource capacity to minimize the pos-
sibilities of power outages? How do we minimize that? I mean——
Mr. PUGLIARESI. We have not invested enough in the grid, and
we have not invested enough in systems that can back up and pro-
vide reliability for intermittent power. And, you know, there are a
lot of ways to address this.
I have always—I—some time ago I spoke to Chairman
Chatterjee, when he was chairman of FERC. And I said, ‘‘Why
don’t we have everybody bid firm power? Let the solar folks, the
wind folks come to the table with 24-hour power, and at least we
would have some price discovery.’‘ We don’t really know what the
cost of intermittent power is, because it is not the same as baseload
power. It is a different product.
Mr. BUCSHON. Understood. I yield back. Thank you very much.
Mr. MCNERNEY. The gentleman yields back. The Chair now rec-
ognizes the gentleman from Arizona, Mr. Schrader, for 5 minutes
for questions.
Mr. SCHRADER. Well, Oregon is a good State, too.
Mr. DeLaski, my question pertains to Congresswoman Dingell’s
bill to create a new demand response system for residential water
heaters. Do you envision that the provisions regarding demand re-
sponse capability for hot water heaters could rely on the internet,
as opposed to in person only?
Mr. DELASKI. So some programs that exist today in states such
as Oregon and Washington and others do rely on being able to con-
trol, being able to—consumers can opt into programs where they
can gather information, for example, for a water heater to respond
to a price signal so that the water heater knows that, when prices
are low, it is a good time to charge up. And then, when prices are
high, it is a good time for that element not to be activated. So, yes,
106
that information would travel over the internet, and the—to know
what is happening with prices in real time.
So yes, technology has advanced tremendously, and being able to
use the ability of real-time knowledge to make the water heater de-
cide when it is going to operate is a benefit that could be achieved
through a smart, well-designed program created by a utility.
Mr. SCHRADER. That could be a win-win, and save money for the
consumer, as well as the utility and rates overall.
Do you expect such demand response technology to be open
standard or proprietary?
Mr. DELASKI. So there are three states now, or a number of
states that have set standards on manufacturing, and they are gen-
erally requiring an open standard. And that would be part of what
would make sense, as the Department considers doing a national
standard.
One of the benefits that we see in having standards is that
they—open standards that would allow any number of market par-
ticipants to participate in that market to provide demand response
services, so that it is not proprietary, and not controlled by any-
one—so that we get competition in the market. That is the objec-
tive of an open standard.
Mr. SCHRADER. Yes. Because otherwise, it could be extremely
costly to the utilities, the ratepayers, and kind of confusion in the
marketplace for the consumer that thinks they can hook up and
have that demand response that you alluded to earlier.
The Department of Energy is supposed to determine the eco-
nomic viability and technological feasibility of these demand re-
sponse technologies. Do you expect such technology to be put in
place here in the short term, next year or so?
Mr. DELASKI. Well, as I mentioned earlier, there are a number
of states that have requirements today, including up and down the
West Coast, and then a number of states have authority for that
[inaudible] for standards to be required, as well. So that is al-
ready starting to shift the markets and creating a range of require-
ments on manufacturers that are coming in the
[inaudible] at different times, different
[inaudible].
The technology is there today. I think the question is, do we try
to normalize this and have a national approach? Or do we let it go
State by state?
Mr. SCHRADER. Very good, very good. Yes. No, it seems like the
sooner we move to some uniformity in that area, the better off we
will all be.
With that I yield back, Mr. Chair.
Mr. MCNERNEY. Well, the gentleman from Oregon yields back.
The Chair now recognizes the gentleman from Michigan, Mr.
Walberg, for 5 minutes.
Mr. WALBERG. Thank you, Mr. Chairman, and thanks to the
panel for being here. While I am glad we are discussing some of
the bills today, I know our time could be better served by address-
ing the energy crisis happening across the country.
Today it has been reported to me the average price of gasoline
in Michigan is $5.13 a gallon. In Washtenaw County, in my dis-
trict, where University of Michigan is, the situation is even worse,
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with prices hitting nearly $5.23 a gallon, which is $0.30 higher
than the national average.
My constituents are struggling. And as members of the Energy
Committee in the House, we need to be doing more to address this
issue because it is, as some of my colleagues have said already, is
impacting people’s lives, literally, with choices that they shouldn’t
have to make that are really life-changing choices.
There are some good bills before us today, as I said, but the
scope of the challenge calls for much more. It is unfortunate that
the Republican legislation that would help alleviate high prices at
the pump, like the American Energy Independence from Russia
Act, the Strategic Production Response Act, and My PIPES Act are
not up for discussion.
That being the case, Mr. Pugliaresi, in your testimony you out-
line that there is a fundamental misunderstanding of the impact
of government policies on energy markets. Can you talk about that
misunderstanding, and how it has led to higher energy prices?
And how can we transition back to a more realistic approach to
energy policy?
Mr. PUGLIARESI. Right. I think one misunderstanding is the
scope and the scale of the energy transition. It is much, much hard-
er than most of our analysts and our—much of which the govern-
ment believes. This is a worldwide problem. Even if the U.S. were
to go to net zero, and all our OECDs were to go—all our member
countries in the OECD were to go to net zero, in the absence of a
transformation through Asia Pacific and the rest of the world, the
reduction in greenhouse gas emissions in 2050 would probably be
about 20 percent less.
So the real issue here is that economic growth and prosperity,
human development is going to take a massive commitment of con-
tinued production of fossil fuels.
And the United States is blessed with extensive resources of oil
and gas. But we have made a lot of mistakes. We have not pro-
vided the infrastructure, the regulatory programs to allow the in-
frastructure to build these resources out and to make energy more
affordable for the American people.
Mr. WALBERG. Yes, yes. And hearing comments that Americans
are addicted to oil and fossil fuels—we are addicted to success. We
are addicted to a good standard of living. We are addicted to future
opportunities. And I don’t think most of us mind doing away with
fossil fuels if we have something better. What we want to have is
our continued lifestyle in the United States, which benefits the
world.
Turning now to the legislation before us, last Congress I was a
cosponsor of an earlier version of H.R. 7962, which aims to fix an
Obama-era regulation and modify the definition of water heater
under the energy conservation standards. This has been a long
process, and I commend the stakeholders for continuing to work to-
gether to come to an agreement. I am also a cosponsor of the cur-
rent iteration. However, there are still some questions that remain
which may impact my continued cosponsorship.
Mr. Greene, the current version of the legislation has some new
language involving demand response, as we have talked about, for
residential hot water heaters. Why was this provision necessary,
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and how does your company and the broader industry feel about
its inclusion?
Mr. GREENE. Thank you, Mr. Walberg. The industry does support
the language as a threshold matter, No. 1.
No. 2, the language was inserted, based upon stakeholder input
from the prior iteration of the bill, and working with one particular
stakeholder, the National Rural Electric Cooperative Association,
and deriving language that would help maintain the ability of con-
sumer choice for electric storage water heaters.
The DR language, the demand response language, is more about
manufacturers coming together and having the Department have
one national standard on the capabilities that the water heater
would have to have. Not that there is mandatory enrollment in DR
programs, but just so we, as manufacturers, have one standard to
manufacture two, rather than bespoke standards around the coun-
try.
Mr. WALBERG. OK. Well, thank you. My time is expired, and I
have other questions that I will submit for the record.
[The information appears at the conclusion of the hearing.]
Mr. WALBERG. But thank you, and I yield back.
Mr. MCNERNEY. The gentleman yields back. The Chair now rec-
ognizes the gentleman from Alabama, Mr. Palmer, for 5 minutes to
ask questions.
Mr. PALMER. Thank you, Mr. Chairman. I have got so much that
I want to run by, I need 30 minutes. But I will do the best I can.
I just want to point out some things. And for the record, I am
tired of the Biden Administration trying to put blame on others for
the energy price increases. I want to say for the record that price
increases are not the result of the pandemic. They are not the re-
sult of Putin. They are not the result of profits. They are the result
of policies. And until the Administration adopts policies that will
change the situation, we are going to continue to see energy prices
go up. And they are going to have a devastating impact on low-in-
come households and households on fixed incomes.
We see it played out day after day. We have seen it in Europe,
with their mad dash to convert to renewables. We have seen it
manifest itself in some ways that a lot of people don’t think about.
There is numerous reports out about excess winter deaths, excess
winter deaths as a result of low-income individuals, people on fixed
incomes not being able to afford the price of heating their homes
adequately. This is not freezing to death. This is people with car-
diovascular respiratory illnesses, and we are talking about 20,000
to 30,000 now being reported in England and Scotland and Wales
and places like that, and all around Europe.
So there are consequences for these actions. It is not just eco-
nomic consequences. It is across the board. And I am really, frank-
ly, tired of listening to this Administration try to blame the pan-
demic or Putin or energy company profits for a problem that they
have themselves created.
And Mr. Pugliaresi, I have really appreciated the graphs that
you put up. I would like to see those graphs, but you laid out a
visual for where we are, in terms of our energy policy.
The other thing that I want to point out is—and I think both you
and Mr. Lieberman have commented on this—is the importance of
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the natural gas reserves that we hold. We will never run out of
natural gas. I mean, just a few years ago they were predicting that
we were going to run out of everything. But we will never run out
of natural gas. We will never run out of oil.
And the thing that I want to point out in this, again, this push
toward renewables, if you build a natural gas facility to generate
electric power, it will have a generating life cycle of about 60 to 65
years. You build a next gen nuclear facility, which can use spent
fuel rods that retain 90 percent of their energy, and that facility
will operate for 100 years. I mean, you can only imagine the tech-
nological advances that will occur in that 60 to 100-year period.
But you build—if you rely on solar or wind power, those facilities
have a life cycle of 25 to 30 years. And on the wind power, the tur-
bines start losing generating capacity after ten years.
And I want to add one other thing. To get the same power gen-
eration from a—that you can get from one next gen nuclear that
can be sited on 640 acres, it would take 70,000 acres for a wind
power facility.
So people need to understand what is going on here. And we can
come in here and we can ask questions. You start talking about the
materials that we are going to need, and a lot of times we start
talking about rare earth elements, but we are talking about iron,
we are talking about copper, and others that are not rare earths.
And you have got the Biden Administration wanting to utilize the
Defense Production Act to increase the mining and production of
these metals. But at the same time, the Administration is using
regulations to block it.
I mean, this is what we have got in this Administration, and the
policies that we are getting from the Democrats who have the ma-
jorities in both Houses of Congress, policies that are going to drive
our economy into the ditch, policies that are going to result in more
excess winter deaths, policies that are going to increase the num-
ber of Americans living in poverty because inflation is off the rails
and will continue to go up, and no policies, no sensible policies, no
sane policies that will get us going in the right direction.
Now, I know I am supposed to come in here and ask you some
questions. I will send you some in writing.
[The information appears at the conclusion of the hearing.]
Mr. PALMER. But I just think that we need to have clarity in this
discussion, and I am going to repeat it for the third time: this is
not the pandemic, it is not Putin, it is not profits; it is the Biden
Administration policies.
With that, Mr. Chairman, I yield back.
Mr. MCNERNEY. The gentleman from Alabama yields back. The
Chair now recognizes the gentleman from Arizona, Mr. O’Halleran,
for his 5 minutes.
Mr. O’HALLERAN. Thank you, Mr. Chairman, and Ranking Mem-
ber, for holding his meeting today.
In the Fiscal Year 2022 omnibus Congress authorized the DoE
to provide direct loans through tribal energy loan guarantee pro-
grams. My bipartisan bill, the Tribal Energy Investment Act, would
extend current law, ensuring tribes have access to capital to invest
in energy products—projects vital to our communities which create
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good-paying jobs, and renewable energy to the grid, and encourage
resiliency.
Mr. Frias, can you describe what barriers tribes and tribal orga-
nizations face when financing energy projects?
How does the Tribal Energy Loan Program play a role in low-
ering those barriers?
Mr. FRIAS. Thank you, Mr. O’Halleran, for your question.
You know, tribal communities face difficulty getting access to
capital across the board in all forms of economic development. By
removing—and these—let me step back for a second.
You know, these projects are complex, and there is a number of
components to it. By removing the need for finding a financial in-
stitution to fund this project, and allowing for direct loans, you
simplify the process and make it easier for tribes to invest in en-
ergy development and create, as you have mentioned, jobs: high-
paying, quality, long-term jobs in Indian country.
Overall, there is difficulty getting financial institutions to work
in Indian country. The difficulty was in access—accessing capital in
Indian country, something that we work on quite a bit at NAFOA,
and it is why we have made so many comments on the original
NPR for the Community Reinvestment Act, and why we are look-
ing at the joint NPR, the Community Reinvestment Act, because
getting capital into Indian country is harder than I believe it
should be.
Mr. O’HALLERAN. Thank you, Mr. Frias. In your testimony you
note that the energy development can transform communities. We
have certainly seen that go both ways.
In Northern Arizona, in 2019, the closure of the Navajo Gener-
ating Station cost hundreds of Arizonans, mostly members of the
Navajo and Hopi tribe, to lose their jobs. But other energy projects
like hydrogen, hydropower, solar, wind, natural gas present oppor-
tunity—present opportunities for significant economic development.
I look forward to working with my colleagues to ensure this fix
is made permanent, and tribes have access to the resources they
need to thrive in the 21st century energy economy, and also that
we take into consideration, as these plants close, the families and
the jobs that are going to go with them, to make sure these areas
in rural America stay as part of the permanent structure of our
landscape.
In my remaining time I would like to focus on what America can
do to secure our critical minerals supply chain. I was disappointed
to read yesterday that mining companies taking a page from the
playbook of big oil are prioritizing stock buy backs over investment
in projects essential to securing America’s clean energy supply
chain. We need a diversified, critical minerals supply chain, but
some seem to present a false choice, pitting our transition to re-
newable energy against American commitments to clean water,
protecting our lands, and respecting tribal sovereignty.
We don’t need to compromise American values to build a strong,
critical minerals supply chain. We need to understand the makeup
of that supply chain in the world, and become dominant in those
areas that are—where we are now weak. We need to identify clear-
ly how we are going to strengthen those supply chains and, if pos-
sible, bring a lot of that back to America, where it belongs.
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I am committed to working across the aisle to find common-sense
solutions to ensure we aren’t trading with—which authoritarian re-
gimes plague us into an energy crisis, and instead invest in a fu-
ture where America is truly energy independent
[sic].
Article after article after article has clearly identified—and stud-
ies—that we are not in the right place when it comes to the re-
sources that we need to both address the challenges our society is
facing, and to address the needs of a cleaner climate and less car-
bon future.
And with that, Mr. Chairman, I yield.
Mr. MCNERNEY. The gentleman from Arizona yields. The gentle-
woman from Arizona is now recognized for 5 minutes to ask ques-
tions.
Mrs. LESKO. Thank you, Mr. Chair. It is Arizona time, I think.
I want to make a statement first before I ask a couple of ques-
tions. I really think, on H.R. 7962, we need to remove the demand
response system program. I understand that you want a national
standard, but from a consumer point of view, I can tell you that
my constituents are going to go epileptic if they think the utility
companies are going to shut off their water heater in the middle
of a shower. And so I think that that is a problematic part of it.
I have a question for Mr. Pugliaresi. In Arizona we have a lot
of mining. And so we have—we produce about 65 percent of Amer-
ica’s entire copper production.
There is also another mine in Superior, Arizona owned by Rio
Tinto, where they have invested $2.3 billion. And under the Trump
Administration, it was given the green light. But two months into
the Biden Administration it was—pulled the plug. And it could
produce about 25 percent of all the copper that is needed or con-
sumed in the United States.
We also have a—large lithium deposits in Arizona.
So my question is, how do you think H.R. 1599, which is Rep-
resentative Upton’s bill, would help produce and encourage mining
in the United States, which, of course, is needed if we are going
to move to, you know, send—wind and solar and EVs?
Mr. PUGLIARESI. So I think the bill would permit DoE to identify
the importance of these materials. It is not going to fix the Interior
Department, right? I presume these mines are on public lands, and
particularly in Arizona, and they are—unfortunately, we are going
to eventually have to reform NEPA.
I am not sure why the Administration pulled the plug on those
mines, or whether they were acting on a court case. But we are
going to have to find a way to develop resources in this country
that is—meets environmental standards, but can go through a reg-
ular approval process, rather than endless delays and fighting over
a very uncertain set of standards. So in that sense, it is a much
more serious reform problem we need to undertake.
Mrs. LESKO. And I agree with you. We need to promote not only
mining, U.S. mining production, but U.S. oil and gas production to
solve some of our problems and be less reliant on China, quite
frankly.
My next question is for Mr. Lieberman. H.R. 7947, the Weather-
ization Enhancement and Readiness Act of 2022, creates a new
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weatherization readiness program to provide grants to State and
tribal organizations for low-income residents. I have been a sup-
porter of the Low-Income Home Energy Assistance Program,
LIHEAP, which provides Federal funded assistance in managing
costs associated with home energy bills.
My question is, do you think this bill, this new program estab-
lished by this bill, would be duplicative of LIHEAP?
Mr. LIEBERMAN. It could be. LIHEAP helps pay the energy bills
after they have been incurred. Weatherization, if it works right,
prevents the energy from being used in the first place.
Again, I think the problem with the weatherization program,
how much bang for the buck are we getting, how many cents on
the dollar are being spent wisely, I think that we are doling out
more money after more money after more money without taking a
look at what past money has succeeded at and failed at.
And in terms of the larger issues, I think if a low-income house-
hold had a choice between a completely unweatherized home and
the energy bills of the recent past, or a heavily weatherized home
but today’s energy prices, I think most would go with the
unweatherized home. It would probably be cheaper for them. So we
really need to get those energy costs down through more produc-
tion. That is job one.
Mrs. LESKO. Great. Well, I thank all of you for being here, and
those online and testifying. And let’s work together and help Amer-
ica.
And with that, I yield back.
Mr. MCNERNEY. The gentlelady yields back. I understand that
there are members that wish to come back after recess for ques-
tions.
So at this point we are going to be calling recess until imme-
diately after votes.
[Recess.]
Mr. MCNERNEY. I call the subcommittee back to order.
The gentlewoman from Delaware, Ms. Blunt Rochester, is now
recognized for 5 minutes for questions.
Ms. BLUNT ROCHESTER. Thank you, Mr. Chairman, for calling
this hearing, and thank you to all of the witnesses for your testi-
mony today.
Even though summer officially began yesterday, we are already
entering the third week of excessive heat and humidity across the
continental United States. These record high temperatures and ex-
treme weather events will continue to put pressure on the country’s
energy sector, which is why it is more important than ever to work
together on legislation that makes our energy infrastructure more
efficient, more resilient, and more affordable.
Electricity is a necessity to our everyday life, from the heating
and cooling of our homes and buildings to the use of important
medical technologies. The public health and safety of our constitu-
ents requires reliable access to electricity. The demand for elec-
tricity only continues to grow. We need to invest and upgrade our
energy infrastructure in ways that will help optimize energy and
help our country combat the ongoing impacts of climate change.
And it is critical that we work together on this legislation, so that
we can help expand and modernize our Nation’s energy infrastruc-
113
ture, making it cleaner, safer, and more dependable, and more af-
fordable for all Americans.
Dr. Mulvaney, the renewable energy transition is a key compo-
nent of addressing climate change by lowering harmful emissions
and providing more Americans with clean energy. Many of these
low-carbon technologies, however, still rely on critical minerals that
need to be mined from the Earth. And like many renewable tech-
nologies, the solar panel supply chain is quite complex. Environ-
mental technology standards are becoming more common, such as
the ‘‘ultra-low carbon’‘ standard that you are advising through the
Green Electronics Council.
What would ultra-low carbon technology mean, not only for emis-
sions, but also for environmental justice communities, where resi-
dents are already overburdened by mineral processing and recy-
cling facilities?
Dr. MULVANEY. Thank you for that wonderful question. There
are a few ways.
First of all, I think, to your second point, recycling processes—
you know, here I am talking about advocating for recycling tech-
nologies. They are often located in low-income communities, and
have their own environmental justice consequences. So recycling is
a partial solution to this, but we have to be cognizant of these par-
ticular—you know, particularly heavy metal issues. I am thinking
of Southern California and the Exide facility that left a really bad
legacy, and the communities there who are still dealing with that
cleanup. So we have to be very, very careful about how we site new
recycling facilities, and where we put these, and ensure that the
communities and stakeholders are there.
And I will just add one other potential source I think that is
missing from the conversation so far is mining—industrial resi-
dues. So mining waste. A lot of these critical metals are actually
onsite at existing mines already in tailings piles. I am thinking of
coal ash as a potential source for rare earth elements. I mean, that
stuff would be pretty easy to permit, and you could start processing
that right away.
And another example here, Rio Tinto, you know, a major mining
company, just expanded their copper mining processing facility to
also recover tellurium. Now, tellurium is about 1,000 times more
rare than rare earth elements, and it is a critical ingredient to the
semiconductor technology that the major—largest manufacturer of
solar panels in the United States, First Solar, is using. And they
did that by not adding new greenfield mines, but by strategically
investing in certain pieces of equipment on their own sites.
So I hope I answered all of your questions.
Ms. BLUNT ROCHESTER. You did—very, very comprehensive.
I guess my next question to you is that many of my colleagues
have already noted that H.R. 8053, the GRID Act, would address
national security threats. Can you talk about how energy efficiency
upgrades to critical defense facilities help to combat national secu-
rity threats?
Dr. MULVANEY. Well, I think that there are a lot of probably inef-
ficient uses, historically, of energy on military facilities.
So one, I think there is—just upgrading that equipment is going
to benefit, generally, the national security, even just kind of, you
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know, new wires, new transformers. Things like that, I think, are
really key there.
But also the power of procurement, I think, a little bit, too. I
think, you know, when you think about using the Department of
Defense or government—Federal investments to kind of spur new
industries, I think that that could also be a side effect of these in-
vestments.
Ms. BLUNT ROCHESTER. Great, thank you. And my next question
is for Mr. Greene. And I only have 20 seconds, so I might have to
submit this to the record.
So I will give you some food for thought. We were talking specifi-
cally earlier about H.R. 7962, of which I am a proud cosponsor.
And my question, which I will ask you for the record, is how can
legislation that focuses specifically on residential energy efficiency,
such as this bill, help alleviate the growing cost to Americans, and
help combat climate change?
We will ask you on the record.
[The information appears at the conclusion of the hearing.]
Ms. BLUNT ROCHESTER. And thank you so much, Mr. Chairman,
and I yield back the time.
Mr. MCNERNEY. The gentlelady yields back. The Chair now rec-
ognizes the gentleman from Virginia, Mr. McEachin.
Mr. MCEACHIN. Well, thank you, Mr. Chairman, and thank you
for pulling this meeting together, and to our witnesses. I extend
you greetings, and thank you for your testimony today.
Mr. DeLaski, your organization works to advance standards that
reduce emissions, and that contribute to climate change and public
health harms. Whether through weatherization or through better
appliance standards, what type of financial savings can be realized
by reducing energy use, particularly for those of low to moderate
income?
And what might—what impacts might these savings have, sir?
Mr. DELASKI. Thank you for the question. I will start with the
weatherization program.
The weatherization program is a proven successful program for
lowering energy bills for low-income households. The typical sav-
ings, or the average savings for a participant—participating house-
hold is $372. That is real money. That is real money that matters
for households that are making decisions between, you know, how
do I pay for my medicine, how do I pay for my medicine versus util-
ity bills versus food. This is an incredibly important amount of sav-
ings that makes a real difference.
I also want to point out that the program is very cost-effective.
The data that we have, and that I think is well documented, is that
for every dollar invested in the weatherization program, $1.72 is
generated in energy saving benefits. Those are direct benefits.
And while those energy saving benefits are important, those
same investments are resulting in an additional $2.78 in non-en-
ergy benefits that are perhaps even more important for vulnerable
communities. This is like lower asthma rates, reduced respiratory
illness, money to pay for medications. This is, you know, better
home comfort. So the benefits aren’t just energy savings. They are
making the homes more safe for the people who live there who are
the lowest income households.
115
The Appliance Standards Program also delivers very large sav-
ings for average households. The typical U.S. household is spending
$500 less this year on their utility bills than they would be spend-
ing if we never had appliance standards. The program works be-
cause it has a proven track record of success, and it is delivering
savings today. Those savings can be increased by improving our
standards over time to keep pace with technological change in a
cost-effective way.
Mr. MCEACHIN. Thank you for that. Sir, you have spoken today
in support of H.R. 7962. And while this bill would do a great deal,
one particular piece I am interested in is around the creation of a
new demand response program for residential water heaters. As we
move to electrify as much as possible and decarbonize our grid, de-
mand response will be key.
Can you discuss the benefits of demand response as it relates to
water heaters, but also what this program, should it be signed into
law, could demonstrate about how consumer demand response pro-
grams and technologies may work on a day-to-day basis?
Mr. DELASKI. Yes. Thank you for that question.
We have a bit of a chicken-and-egg problem with demand re-
sponse. The chicken-and-egg problem is that, for this program to
work for the average consumer, most demand response programs
today are directed at large commercial and industrial customers.
They are the ones who get the benefit of being able to shift their
demand in response to price signals from the utility companies,
and to save money to reduce their energy bills. It is—can be very
hard for households to choose to participate in these programs, be-
cause they aren’t designed for them and, in part, because they
don’t provide the scale.
So to achieve scale, to be able to get significant demand response
benefits, it is important that the technology be deployed in a lot of
homes. Consumers may or may not choose to take advantage of it,
but we need to ensure—what this bill would do is create the possi-
bility for the Department to set requirements that would enable
large numbers of water heaters deployed in people’s homes to give
them the choice of participating in demand response programs that
can let them opt in to lower utility rates.
Absent this kind of national requirement, it is a onesie/twosie
type of approach to achieving the scale that is needed to be able
to let the average consumer take advantage of demand response
and take advantage of the lower rates that are available at certain
times a day. And those power resources are often the cleanest
power resources that are being under-utilized during parts of the
day when we could be charging up our water heaters.
Mr. MCEACHIN. Thank you, sir.
Mr. Mulvaney, the text of H.R. 1599 is language that says—or
directs the Department of Energy to improve technology that
reuses and recycles critical energy resources. And you have in your
testimony noted that, at least with regards to lithium ion batteries,
we could do much better. Can you talk a little bit about that?
And what would it look like for the Department of Energy to
take the direction in this legislation, and what would be the bene-
fits of so doing?
And you have all of 20 seconds. I apologize to——
116
Dr. MULVANEY. No, that is OK.
I think either—some Federal electronic waste law could benefit
collection. It spurred collection of this stuff in Europe. Or, if the
private sector adopted probably industry-wide extended producer
responsibility that made sure the polluter paid for the end of life
of their product.
Mr. MCEACHIN. [Inaudible.]
Mr. MCNERNEY. The gentleman yields. That concludes the mem-
ber questions.
I would like to thank our witnesses for participating in today’s
hearings. I remind members that, pursuant to committee rules,
they have ten business days to submit additional questions for the
record to be answered by the witnesses who have appeared. I ask
the secretary to respond promptly to any questions you may re-
ceive.
Before we adjourn, I receive unanimous consent to enter the fol-
lowing questions—records into the testimony for the record.
[Pause.]
Mr. MCNERNEY. OK. I am going to backtrack a little bit. We
have one more member for questions.
Mr. Joyce from Pennsylvania, you are recognized for 5 minutes.
Mr. JOYCE. Thank you very much. First, I want to thank the
chairman and the Ranking Member Upton for allowing me to waive
on to this important subcommittee hearing. And thank you to the
witnesses for appearing with us here today.
As we have heard from many of my colleagues, America is in the
midst of an energy crisis, a crisis that was created by the Biden
Administration. Each and every day I hear from constituents who
are shocked by the skyrocketing gas and electricity prices that they
face each month. What America needs right now is more afford-
able, reliable, and clean baseload power.
Our nation has the ingenuity and the capability to lead the world
in this transition. By investing in innovative technologies like car-
bon capture and hydrogen storage, we can take advantage of the
energy reserves beneath the feet of my constituents, and keep our
coal and our natural gas power plants online.
On Sunday the Financial Times reported that Germany would
reopen several shuttered coal plants in order to avert the potential
natural gas shortage for the upcoming winter months. Germany
will fire up these coal plants, despite the fact that the country has
committed to phasing out coal by 2030. Meanwhile, its three re-
maining active nuclear plants are scheduled to go offline later this
year, and the government has no plans to extend them.
Here in the U.S. we are facing a similar sort of energy crisis be-
cause we are not adequately taking advantage of the resources that
are under our feet, whether it is coal, natural gas, or nuclear en-
ergy.
My first question is for Mr. Pugliaresi.
Mr. Pugliaresi, what steps can we take in order to learn from
Germany’s errors, so that we can smartly transition to clean, reli-
able baseload power, while at the same time regaining our energy
dominance?
Mr. PUGLIARESI. I think at first we have to have a realistic view
about—that some of the alternative fuels we are trying to promote
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now have limitations that are not fully appreciated, particularly by
both government policymakers and the public.
And in the case of Germany, it is quite clear, when you choose
a very narrow set of fuels—in this case they had a high reliance
upon gas and wind—solar in Germany is pretty limited—and it
might seem stable, it might be—it might make a lot of sense in the
beginning, but it is like an investment portfolio. The—you face a
lot of risks when you make too narrow a choice. So we need a wide-
ly diverse set of very productive fuels to power our economy.
Mr. JOYCE. Mr. Pugliaresi, I agree with you. I think that you
have elicited that we need reliable and resilient and diversified
power sources to maintain the power grid. And it is more impor-
tant than ever, as we see an evolving market forces.
As more intermittent resources—such as you mentioned, wind
and solar—get brought online, and more EVs are placed on the
road, the grid must accommodate demands in ways that it was
never designed to do so. How can we encourage the collaboration
with grid operators and utilities so as to better plan for the future,
and to preserve and promote the resiliency that we need to see in
the grid?
Mr. PUGLIARESI. So I think we have under-invested in our grid
for a lot of reasons. It has been kind of an afterthought. And the
time has come now where utility systems and the regional—you
know, the transmission organizations, we are going to have to put
a lot more money into the grid, and a lot more effort in upgrading
it and modernizing it so that it can undertake a wide range of fuel
sources and generating power.
Mr. JOYCE. My final question is for Mr. Lieberman.
Your testimony touches on reining in government spending and
strengthening consumer and taxpayer protections. Unfortunately,
this Administration seems focused on expanding Federal agencies
on the taxpayers’ dime, while using regulation to prevent unlocking
the resources that would actually provide the consumer with some
necessary relief. Permitting is a big part of this.
Could you speak to the energy infrastructure permitting reforms
that might allow the U.S. to unlock its energy potential and bring
down the prices, the prices that the average American is facing
right now?
Mr. LIEBERMAN. I remember when President Biden mentioned
that there were 9,000 permits that weren’t being acted upon, oil
and gas permits. And I looked into it, and others looked into it.
And of those 9,000, there is a number of other ways that the gov-
ernment can actually stop the actual process of drilling, even for
permitted projects. There is just so much going on. There is so
many different ways to block production, and they are all being ag-
gressively used right now.
One thing I would mention is the National Environmental Policy
Act, or NEPA. The previous Administration made some modest but
useful reforms to that that I think have been—that have been
largely reversed by this Administration. That is heading in the
wrong direction. We need to have a much more streamlined permit-
ting process, or the same mines we are talking about today we will
be talking about them five or ten years from now.
118
Mr. JOYCE. The streamlining of the permitting process is abso-
lutely necessary.
Mr. Chairman, thank you. I appreciate you allowing me to waive
on to this important hearing.
And I thank all the witnesses for your participation.
Mr. MCNERNEY. The gentleman yields.
At this time I request unanimous consent to enter the following
documents into the record: No. 1, a June 21st, 2020 letter from the
Air Conditioning, Heating, and Refrigeration Institute to the Com-
mittee on Energy and Commerce in support of H.R. 7962; a June
22nd—June 21st, 2022 letter from the National Community Action
Foundation in support of H.R. 7947; No. 3, a June 22d, 2022 letter
from the U.S. Department of Energy on the underlying legislation
of today’s hearing; No. 4, a June 22d, 2022 letter from the National
Mining Association in support of H.R. 1599; No. 5, an October 14th,
2021 letter from Representative Don Young on H.R. 5292; and last,
No. 6, a June 21st, 2022 letter from the Joint Associations in sup-
port of H.R. 7962.
Without objection, so ordered.
Mr. MCNERNEY. At this time the subcommittee is adjourned.
[Whereupon, at 2:22 p.m., the subcommittee was adjourned.]
[Material submitted for inclusion in the record follows:]
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