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Hearing of Committee on Energy and Natural Resources - Consider the Nomination of Samuel W. Bodman to be Secretary of Energy

Location: Washington, DC

Hearing of Committee on Energy and Natural Resources - Consider the Nomination of Samuel W. Bodman to be Secretary of Energy


Senator Salazar. Senator Domenici and Senator Bingaman, I just want to say it is an honor for me to be here to serve with
all of you on this very important committee, and I look forward to working with all of you.

I do have an opening statement, and I have questions, and I just, with your permission----

The Chairman. Do you have an opening statement? We'll make it a part of the record, if you have one.

[The prepared statement of Senator Salazar follows:]

Prepared Statement of Hon. Ken Salazar, U.S. Senator From Colorado

Good afternoon. Thank you, Mr. Chairman. It is a privilege to serve on this important Committee with you and with Senator Bingaman, to whom I am grateful for this assignment. I very much look forward to working with you and with all of my colleagues as we strive to develop a clean, diversified and secure energy future for Colorado and our country. I
know I will learn a great deal from all of you, as you share your experiences and leadership on a wide range of issues affecting the nation's energy sources and other natural resources. I hope that my own experience, as a farmer and rancher for much of my life, and as someone who has been deeply involved in water, environmental and natural resources issues throughout my career will be helpful to this Committee.

And thank you, Dr. Bodman, for your long and distinguished service to our country. Your experience in the Commerce and Treasury Departments will be very valuable, I expect, as you consider ways to improve our nation's energy independence and energy security.

I grew up in Colorado's San Luis Valley, part of the fifth generation of my family to make its living from the land. As I said, I
have been actively engaged in agriculture as a farmer and rancher for much of my life. My grandparents and parents passed along to me the values of preserving and protecting our air, land and water for future generations.

Colorado is blessed with an abundance of natural energy resources, and the oil and gas industry plays a significant part of our state economy. As long as America is dependent on foreign oil for a significant part of our energy needs, our economy and our national security are at risk. We need to move rapidly toward energy independence. As we work to attain energy independence, we can also strengthen our economy, increase our national security and protect our air, land and water.

A. Balance Between Energy Development and Environmental Protection

We need to increase our domestic production of oil and gas, and we can do that in ways that do not harm the environment. But there are some places that should not be drilled because they are just too valuable for protection of water, fish and wildlife habitat or recreation.

The Roan Plateau near Rifle, Colorado, is an area that exemplifies the need to balance multiple values and uses of public lands. The area is rich in natural gas and other energy resources, but the top of the plateau is one of the state's most biologically rich areas. We need to work toward energy independence, but we also need to protect wildlife habitat critical to hunting and fishing, an important component of the local economy. Garfield County and some other local governments, as
well as many local citizen groups, have expressed opposition to drilling on top of the plateau. The Bureau of Land Management recently released a draft Environmental Impact Statement reviewing all of these matters. I am working closely with representatives of BLM and the state to ensure that the federal government refrains from issuing additional
leases on top of the Plateau until leases at the base of the Plateau are fully developed and other environmental safeguards are in place.

B. Renewable Energy

The Western Governor's Association has now adopted at least two energy policy resolutions, which call for new exploration and development of conventional energy sources, where air, land and water can be protected, and at the same time urge the development of alternative (renewable) energy resources, energy efficiency and conservation. In my judgment, renewable energy is our future, and we need to support research and development in this industry so that we are the international leader, not a follower.

As you may know, Colorado just passed Amendment 37, the Renewable Energy Standard. I supported Amendment 37, because it makes renewable energy a reality, not merely an aspiration. Amendment 37 creates a modest standard for renewable energy generation in Colorado, starting at only 3% in 2007 and rising gradually to only 10% in 2015. The ballot
measure protects ratepayers from any rate hike larger than 50 cents per month for any expense related to the policy. Many other states have passed similar legislation, and I look forward to working with you and my colleagues to further this agenda on renewable energy.

C. Clean Energy Research and Conservation

We also need to support research into hydrogen fuel cells, solar energy, geothermal energy, hybrid auto engines, and higher fuel efficiency for automobiles and home appliances. I hope I can count on your support for these principles and your commitment to working with this Committee to develop a national energy policy that includes a viable renewable energy program as well as necessary clean energy research and energy conservation.

To further these goals I urge you to support the Department's National Renewable Energy Laboratory in Golden, Colorado. As you know, NREL is the Department of Energy's primary national laboratory for renewable energy and energy efficiency research and development. I am a proud supporter of NREL and its research projects. Providing NREL with
the resources it needs will lead our nation to greater energy independence and security.

D. Rocky Flats

Finally, I fully expect you to provide continued support for the timely cleanup of the Department's Rocky Flats facility west of Denver, Colorado. As you know, Rocky Flats manufactured components for nuclear weapons for the nation's defense from the 1950's until 1992. The environmental cleanup is scheduled to be completed by December 2006. Most of the 6,500-acre site will become part of the National Wildlife Refuge System, but approximately 1,200 acres will remain under DOE control. As I understand it, that area, which will be cleaned up to no more than 50 picocuries of Plutonium per gram of soil, will be fenced
off from the National Wildlife Refuge to protect Refuge workers and the public. The cleanup of Rocky Flats serves as a model for the cleanup of DOE facilities nationwide, and it is therefore important to the people of my state and to the country as a whole for DOE to make its plant closure mission at Rocky Flats a priority and to complete environmental cleanup, waste management and decommissioning by December 2006.

It is with these principles in mind that I hope you will help develop new clean energy goals and energy efficiency programs that will help meet our country's future energy needs and lead to greater energy independence and security. The Committee will work on an energy bill again this year. I look forward to working with my colleagues on this Committee and with you, Dr. Bodman, to do everything we can to help develop a comprehensive and sustainable energy strategy that is also
protective of a healthy environment in the West and across the country. Again, thank you, Mr. Chairman and Senator Bingaman. And thank you, Dr. Bodman.


Senator Salazar. First of all, let me just say, I have a number of questions--nine questions--and I would appreciate
your response to those questions in writing, because I do not know that we'll be able to get through all those questions in
the time that we have today.

I want to ask you a question about renewable energy. In my own State of Colorado, we have seen renewable energy do a
number of good things for our State. In the rural areas of Colorado, on the Eastern Plains, we have wind farms that have
come into play in the last several years, which are doing a lot of good things for the communities out on the Eastern Plains.

Is that a microphone problem?

The Chairman. No, we are trying to figure it out, but I do not think it's--as long as we can be heard, maybe you can
proceed. We understand it's nothing risky. So----

Senator Salazar. Not a warning?

The Chairman. No, it's not a warning. It's nothing like that.

Senator Salazar. From my point of view, renewable energy is really important, first of all, because it helps us get rid of
the over-dependence on foreign oil. Second, it's good for economic development, especially in our rural communities of
our Nation. And, third, it's good for our environment. And my question to you is this. If you can speak to specifics, in
terms of how you would move forward in embracing a renewable energy ethic for our country? It's easy, I think, in this area,
to sometimes do a lot of talking about renewable energy, and I'd like to hear from you how we intend to walk the talk as we
move forward with the energy policy of the country with respect to renewable energy. And specifically, and related to that in a
parochial way, we have the National Renewable Energy Labs in Golden, Colorado, and we have a groundbreaking for the new Science and Technology Lab that's coming up in this next month. One, I would invite you to come out there and to be a part of what is going to be happening out there, and, two, I would also ask you to support, in the capital construction budget for 2006, the continued operations of that lab and the new part of that lab that will be opened up, hopefully, within the next
couple of years.

Dr. Bodman. As to renewable energy, sir, the first part of the question that you asked--I have not, at this time, reviewed
all of the different programs. There are a number of them within the Department. I can tell you that I remain quite
enthused about the prospects for a number of them--wind being one--where, at least based on inquiries that I have made,
preliminary ones, there seems to be the prospect of being able to produce energy, particularly if we can do it near a
population center, where we are not dealing with a great length of transmission.

An area that has not been as successful--as I had forecast some years ago is in the photovoltaic area, or solar energy.
One would hope that, with the work that's gone on in the nanomaterial area, with the possibility of new devices, that we
could see some progress there.

So it's hard for me to be more specific than that, other than to tell you that, as a general matter, I tend to be rather
hands-on, and the folks who are involved in these efforts at the Department would find a willing ear to listen, and, I hope,
a good questioner, as to what our past practices have been, and encouragement on being more aggressive in these matters,
because I do think we need to be successful.

Senator Salazar. That's right.

Dr. Bodman. I cannot comment on my schedule, as to the opening of the laboratory in Golden, but I will certainly do my
best to try to be responsive to your wishes.

Senator Salazar. Thank you.

Let me ask you another parochial question. This relates to Rocky Flats, but it's actually applicable to all other States
where we have cleanup of nuclear facilities underway. Rocky Flats, in Colorado, has become, I think, a role model for how
we do cleanups around the country, and it's a project that we have put together on a bipartisan basis, and there's a lot of
pride in the achievement that we have out there at Rocky Flats.

We have, in Colorado, put together State legislation that allows us to put institutional controls into place so that we
can safeguard land that is not completely cleaned up, as is the case in Rocky Flats, from future development. And it's a way
which I think the states are being very effective at trying to address the cleanup challenges that we face at some of these

We've had problems, frankly, with the Department of Energy and the Federal Government, in terms of recognizing our State
law. And I do not know if you are familiar with that kind of detail at this point in time, but it's something that I would
ask you to look into, and hopefully support the bipartisan institutional controls that we have created in the state of

Dr. Bodman. I am not familiar with it, so I cannot comment on it specifically, but I would be happy to look into it. And I
would be happy to discuss the matter with you, sir, once I learn a little bit more about it. It sounds, on the surface, to
be a reasonable thing to do, but I would like to have the chance to understand some of the details.

Senator Salazar. Thank you, Dr. Bodman. I see I have some more time. One more question here, and that is, I know last
year, with the energy bill, there was lots of debate about the Arctic National Wildlife Refuge--whether you drill there, whether you do not. It obviously is going to be a huge issue, probably, as this energy bill unfolds. Without thinking about a specific area--whether it's ANWR or the Roan Plateau in Colorado or other places--what kind of criteria do you envision
using, in terms of area that you think are appropriate for development and areas that are not appropriate for development?
Where would you draw the line?

Dr. Bodman. The issues about where to develop and where not to develop is a function of the probability of success when one does seek hydrocarbon reserves. It also is a function of preserving the largest possible areas for environmental
purposes, while also trying to seek out additional supplies of energy. It's always a matter of trying to strike a balance. I
am a newcomer here; and so, I have spent the last 6 weeks reading materials. I haven't even yet visited the Energy
building. Some tell me that that's an advantage, not to have been there, but I have not been there, so I cannot really
comment on it. I would tell you that, at least based on my experience to date, I think you would find that I would pursue
this in a fashion that is balanced. As we try to address the problems we have, we need to worry about supply, we need to
worry about being more efficient in the use of our energy that we have available to us now, we have to repair the
infrastructure, or add to the infrastructure, so we can deliver, particularly, electrical energy to our citizens around
this country, and we have to seek out new and, hopefully, renewable ways of dealing with problems so that we will
minimize the effects on the environment. And in all of these areas, I think it calls out for a balance. And I would seek out
additional supplies of energy--materials for energy only at the same time that we would seek out all these other things with
equal emphasis.

The Chairman. Senator, thank you very much. Your time is expired. I know you have another, but----

Senator Salazar. I will--I have submitted my questions, and----

The Chairman. Very good.

Senator Salazar [continuing]. Hopefully will get an answer. And if you have a second round, I will have some other questions.


Questions From Senator Salazar

Question 206. Next month, the National Renewable Energy Laboratory (NREL) will break ground on the Science and Technology Facility--the first new research laboratory on the lab's main campus in nearly a decade. The new facility will house key elements of NREL's world-class research in hydrogen and other promising renewable energy technologies
and will push the envelope on sustainable, energy efficient building design. Construction of the facility is scheduled for completion in early 2007. Will DOE request from Congress the final capital constuction funds in FY 2006 to complete this critical new lab building to help our nation meet its future energy needs?

Answer. It is my understanding that ground was broken for this facility several months ago. While I have not been briefed on the President's 2006 budget, I have been told that this project has been fully developed and approved under the provisions of both the Department's and OMB's guidelines for the construction of major projects.

Question 207. Several of my constituents recently participated in a tour of the NREL facility, and I was surprised to learn that it does not operate around the clock, even though there is a long waiting list of companies hoping to use the lab's equipment to test their prototypes of wind turbines and other wind technology. It seems to me that a modest increase in NREL's budget, which would permit the facility to operate 24/7, would repay itself in dividends several times over. Will you support increased funding for R&D and other operations at DOE renewable labs in Colorado and elsewhere in the nation?

Answer. If confirmed, I will be happy to explore the feasibility of operating the laboratory's wind test facilities on an expanded
schedule. With respect to increased funding, future funding requests will depend, as you know, on a variety of factors.

Question 208. The Department will soon complete the environmental cleanup of its Rocky Flats plant west of Denver. In general, the cleanup has progressed well. But, as at many contaminated sites being cleaned up across the country, some contamination will remain in the ground. A part of the site will be designated a National Wildlife Refuge. It will be necessary, therefore, to impose certain restrictions on land use to ensure that the remedy remains protective of human health.

Because existing legal mechanisms to restrict land use are not adequate for this purpose, many states have adopted or are adopting legislation to create enforceable use restrictions, or ``institutional controls.'' In 2001, the Colorado Attorney General's office drafted and sponsored such legislation, and, with the support of the Colorado Department of Public Health and Environment, the General Assembly passed the legislation unanimously. Governor Owens signed it into law.

Colorado's institutional control legislation enjoyed strong support from both industry and the environmental community, because it reduces cleanup costs and it makes cleanups safer and more reliable. Colorado's legislation served as the model for the Uniform Environmental Covenants Act, which is now being considered in a number of states across the country. Federal agencies were among the most outspoken supporters of the legislation, urging EPA and the states to rely on institutional
controls to reduce cleanup costs. Yet, now that states are moving to create enforceable, effective institutional control laws, federal agencies, including DOE, have refused to comply with these laws. At Rocky Flats, for example, DOE, the State of Colorado, and EPA are in general agreement on the use restrictions that should apply to the site. But DOE has refused to put those restrictions in an environmental covenant, as required under state law. DOE has refused to comply with
other states' institutional control laws as well. This refusal has raised serious questions about the long-term reliability of the cleanup now underway at DOE facilities across the country.

Under your leadership, will the Department of Energy comply with state institutional control laws?

Answer. As I stated at the confirmation hearing, I am unfamiliar with the specifics of this issue but would be happy to look into it and discuss the matter with you.

Question 209. I strongly urge the Department to adopt a policy to comply with state institutional control laws. These are valid state laws. They enhance the safety of cleanups, and the cost of compliance is minimal. In my judgment, DOE is required to comply with these laws under the Federal Facility Compliance Act. If the Department does not intend to comply with state institutional control laws, then I ask that you provide me with a detailed legal justification for your position.

Our nation uses more energy resources than we can produce domestically. The millions of barrels of oil that we import every day impose both economic drains on our economy and threats to our national security. There are two ways to attack this problem. We can produce more oil domestically or we can consume less oil.

Do you agree that a policy that focuses only on increasing domestic production and ignores steps to reduce consumption (e.g., through conservation) is missing important options that could reduce our dependence on foreign oil, help our economy and increase our energy security?

Answer. I agree. In fact, roughly half of the recommendations in the President's National Energy Plan pertained to energy efficiency and the expanded use of renewable energy.

Question 210. Will you support the development of clean energy technologies and energy efficiency research within the context of the Department's overall energy policy?

Answer. Yes.

Question 211. In my view, we are a long way from tapping the significant untapped potential for renewable energy resources and increased energy efficiency. New Mexico Governor Bill Richardsonrecently stated that we should be making greater efforts to promote renewable energy sources in the Rocky Mountain region. Governor Richardson and Governor Schwarzenegger of California have taken the lead within the Western Governors' Association to develop a plan to
implement that association's recently adopted resolution on clean energy.

What will you do as Secretary of Energy to assist these efforts to augment our nation's energy portfolio with a more meaningful contribution from renewable energy sources, increased energy efficiency, and clean energy technologies?

Answer. I am informed that representatives of the Western Governors' Association have recently met with top officials of the
Department to discuss ways we might be of assistance. Should I be confirmed, I will be happy to engage in that dialogue as well.

Question 212. How will you help position American firms to be competitive in a global economy that will increasingly be powered by renewable energy sources?

Answer. I understand the new Science and Technology facility as well as the existing wind test facilities at NREL are unrivaled anywhere else in the world, and are available on a priority basis to American firms. Should I be confirmed, I will work to ensure that we continue to partner with American businesses at these facilities, to help ensure that they can be global technology leaders.

Question 213. A study released last week by DOE's Lawrence Berkeley National Laboratory showed that national standards for energy efficiency and renewable energy would produce ``sizeable'' savings for consumers on their natural gas bills, and that associated reductions in the cost of natural gas would be ``effectively permanent''--with customer savings ranging from $10 billion to $74 billion, depending on the scope and rate of policy implementation. According to the DOE study, new power generation from wind costs about 3.5 cents per kilowatt hour, compared to about 4.5 cents for new coal generation and
6 cents or more for gas-fired generation.

I find this DOE study about energy efficiency and renewable energy sources encouraging. Reducing natural gas demand will also put downward pressure on natural gas prices. How do you propose to implement the findings in this DOE study?

Answer. I have not reviewed this particular study, but I understand that the study validates the Department's approach in many respects. For example, DOE has sought to bring down the cost of wind technology and other renewable energy technologies, and the Department's R&D efforts are clearly having an impact. With regard to the broader policy
implications of this study, I will be happy to review the study more closely with those implications in mind should I be confirmed.

Question 214. What other policies would you advocate to reduce the demand for natural gas?

Answer. Most of our natural gas is consumed for a variety of industrial, residential and commercial uses as well as for electricity generation. Therefore, there is no single or simple preferred approach to reducing demand for natural gas. However, we should continue to pursue our diverse portfolio of activities that promote energy efficiency. In addition, we should also be working to diversify our methods of electricity generation (including emission free sources such as wind and nuclear), and providing new supplies of natural gas through domestic exploration and production, the gas pipeline from Alaska, and new LNG terminals.

I recognize that both traditional and non-traditional resources will play an important role in meeting the energy needs of the West and the country as a whole. We may need to increase our domestic production of oil and natural gas, and we can do that in ways that do not harm the environment. But some places should not be drilled because they are just too valuable for protection of wildlife habitat, aquatic resources and other special environmental, scientific and recreational values.

Question 215. What criteria would you use to determine whether certain areas should be off limits to oil and gas exploration and development in order to protect special environmental values?

Answer. These decisions are made generally by the Department of the Interior through its land management planning process and the Congress through its designation of wilderness and other specially protected areas. If confirmed, I will work through the interagency process to achieve the appropriate balance between environmental protection and resource development.

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