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Public Statements

National Defense Authorization Act for Fiscal Year 2013

Floor Speech

By:
Date:
Location: Washington, DC

BREAK IN TRANSCRIPT

Mrs. HAGAN. Mr. President, I wish to speak about an amendment I am going to call up tomorrow, amendment No. 3995. I believe it is critical, this amendment to our long-term national security. In August of 2011, the Secretaries of the Departments of Agriculture, Energy, and the Navy signed a memorandum of understanding to invest $170 million each to spur the production of advanced aviation and marine biofuels under the Defense Production Act.

This joint memorandum of understanding requires substantial cost sharing from private industry of at least a 1-to-1 match. The main objective of this memorandum of understanding is to spur the construction or retrofit of commercial scale advanced biofuel refineries. These facilities will produce drop-in advanced biofuels meeting military specifications. They will be located in geographically diverse locations for ready market access, and will have no significant impact on the supply of agricultural commodities for the production of food.

As the largest single consumer of fuel in the world, the Department of Defense uses approximately 120 million barrels of oil each year, spending over $17 billion in fiscal year 2011 on fuel. This dependency on a single source of energy leaves our military's readiness at risk.

When the price of oil goes up $1, it costs the Navy an additional $30 million and the entire Department of Defense over $100 million. Last year alone, this forced the Navy to pay an additional $500 million because the price of fuel was higher than budgeted.

DOD is not going to allow these additional fuel costs to directly affect our missions in Afghanistan. However, cost overruns could force the military to curtail training and less urgent operations resulting in increased risk to future missions. Developing a commercially viable biofuels industry could help DOD diversify its fuel source and reduce the risk of energy volatility.

Our senior military leaders understand that programs such as this MOU are critical to national security. In July, the Secretary of the Navy, the Chief of Naval Operations, and the Marine Corps Commandant expressed their concern to Chairman Levin.

The demand for fuel in theater means we depend on vulnerable supply lines, the protection of which puts lives at risk. Our potential adversaries both on land and at sea understand this critical vulnerability and seek to exploit it.

The Navy and the Marine Corps have been aggressively evaluating how both energy efficiency and alternative sources of energy can provide tactical benefits to expeditionary forces.

Given the impact of this MOU to our national security, I was disappointed when the Senate Armed Services Committee marked up the fiscal year 2013 Defense authorization bill and an amendment was adopted that would prevent the Defense Department from participating further in the MOU. The bipartisan amendment that I offer today seeks to strike that measure.

I believe Senators on both sides of the aisle agree that energy security is a national security imperative.

However, there are honest disagreements over how the United States pursues energy independence. These divergent views are reflected in the debate over the joint MOU.

One argument used by opponents of the MOU is budget related. Given the current budget restraints, the Department of Defense should not be spending resources to help spur a commercially viable advanced biofuels industry. It is important to put in context the amount of money the Navy is spending on this program. The $170 million dedicated to the MOU in one fiscal year represents .03 percent of the entire fiscal year 2013 budget request of the Department of Defense. Let me repeat that. It is .03 percent.

This is not to dismiss concerns about our current budget situation. I too am deeply concerned about our country's fiscal path, and I continue to advocate for Congress to put politics aside and remake the tough choices necessary to ensure future generations are not burdened by unsustainable debt. However, as we tackle our budgetary challenges, we must not harm programs important to our national and economic security. This joint MOU is one such program.

What about the cost of advanced biofuels? In the past 2 years, the cost of biofuels purchased for these 50-50 fuel blends used in Navy training exercises has dropped by over 50 percent. Moreover, the Navy has made clear that they will not procure large quantities of biofuels for operations until they are cost competitive with traditional fuels. The MOU is bringing the cost of biofuels in line with petroleum, and now is not the time to stop the program from reaching its goals.

As I mentioned earlier, diversifying our energy mix will also help protect our military from the costs associated with price spikes in oil. Sudden energy cost increases force DOD to reallocate finite resources away from long-term priorities.

Critics of the MOU often say if the government wants to promote advanced biofuels, we have a Department of Energy. Of course, the Department of Energy has an important role to play, but so does the Navy and the Department of Agriculture. From my perspective, leveraging the unique capabilities of each agency, in partnership with the private sector, exemplifies the type of innovative approach needed to solve our country's most vexing problems.

Looking back in history, the Navy's leadership on energy innovation is nothing new. It was the Navy that shifted from sail to steam in the middle of the 19th century, steam to oil in the early 20th century, and pioneered nuclear power in the middle of the 20th century. At each of these transitions, there were those who questioned the need, challenged the cost, or simply opposed change of any kind.

I want to make clear that today's debate is not about oil versus biofuels. I was very pleased with the recent International Energy Agency report that projected that the United States would be the world's top oil producer by 2020 and a net exporter of oil around 2030. However, this does not mean we should abandon efforts to diversify our energy supply.

In 1913, on the eve of World War I, Winston Churchill made a historic decision to shift the power source for the British Navy ships from coal to oil. This decision was not without controversy, but Churchill successfully argued that safety and certainty in oil lies in ``variety and variety alone.''

Although at the time Churchill was talking about oil, his message is just as applicable to today's debate about biofuels. True energy security requires energy diversity.

I urge my colleagues at a later date--tomorrow--to support this amendment.

Mr. President, I yield the floor, and I suggest the absence of a quorum.

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