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24–974 2018

S. HRG. 115–135 

OPPORTUNITIES TO IMPROVE AMERICAN ENERGY 

INFRASTRUCTURE 

HEARING 

BEFORE THE 

COMMITTEE ON 

ENERGY AND NATURAL RESOURCES 

UNITED STATES SENATE 

ONE HUNDRED FIFTEENTH CONGRESS 

FIRST SESSION 

MARCH 14, 2017 

( 

Printed for the use of the 

Committee on Energy and Natural Resources 

Available via the World Wide Web: http://fdsys.gov 
(II) 

COMMITTEE ON ENERGY AND NATURAL RESOURCES 

LISA MURKOWSKI, Alaska, Chairman 

JOHN BARRASSO, Wyoming 

JAMES E. RISCH, Idaho 

MIKE LEE, Utah 

JEFF FLAKE, Arizona 

STEVE DAINES, Montana 

CORY GARDNER, Colorado 

LAMAR ALEXANDER, Tennessee 

JOHN HOEVEN, North Dakota 

BILL CASSIDY, Louisiana 

ROB PORTMAN, Ohio 

LUTHER STRANGE, Alabama 

MARIA CANTWELL, Washington 

RON WYDEN, Oregon 

BERNARD SANDERS, Vermont 

DEBBIE STABENOW, Michigan 

AL FRANKEN, Minnesota 

JOE MANCHIN III, West Virginia 

MARTIN HEINRICH, New Mexico 

MAZIE K. HIRONO, Hawaii 

ANGUS S. KING, JR., Maine 

TAMMY DUCKWORTH, Illinois 

CATHERINE CORTEZ MASTO, Nevada 

COLIN HAYES, Staff Director 

PATRICK J. MCCORMICK III, Chief Counsel 

BRIANNE MILLER, Senior Professional Staff Member and Energy Policy Advisor 

ANGELA BECKER-DIPPMANN, Democratic Staff Director 

SAM E. FOWLER, Democratic Chief Counsel 

RICH GLICK, Democratic General Counsel 
(III) 

C O N T E N T S 

OPENING STATEMENTS 

Page 

Murkowski, Hon. Lisa, Chairman and a U.S. Senator from Alaska .................. 1 

Cantwell, Hon. Maria, Ranking Member and a U.S. Senator from Washington .................................................................................................................... 3 

WITNESSES 

Koplin, Hon. Clay, Mayor of Cordova, Alaska, and CEO of Cordova Electric 

Cooperative, Inc. ................................................................................................... 21 

Leahey, Jeffrey, Deputy Executive Director, National Hydropower Association ........................................................................................................................ 27

Bird, Stefan, President and Chief Executive Officer, Pacific Power, a Division 

of PacifiCorp ......................................................................................................... 48 

Leopold, Diane, President and CEO, Dominion Energy, Dominion Resources .. 59 

Zindler, Ethan, Head of Americas, Bloomberg New Energy Finance ................. 70 

Imhoff, Carl, Manager, Electricity Market Sector, Pacific Northwest National 

Laboratory ............................................................................................................ 79 

O’Sullivan, Terry, General President, Laborers’ International Union of North 

America ................................................................................................................. 91 

ALPHABETICAL LISTING AND APPENDIX MATERIAL SUBMITTED 

American Gas Association: 

Statement for the Record ................................................................................. 168 

American Public Power Association: 

Statement for the Record ................................................................................. 173 

American Rivers: 

Statement for the Record ................................................................................. 175 

American Whitewater: 

Statement for the Record ................................................................................. 184 

Bird, Stefan: 

Opening Statement ........................................................................................... 48 

Written Testimony ............................................................................................ 50 

Responses to Questions for the Record ........................................................... 133 

(The) Business Council for Sustainable Energy: 

Statement for the Record ................................................................................. 190 

Cantwell, Hon. Maria: 

Opening Statement ........................................................................................... 3 

Article from the Houston Chronicle entitled ‘‘Hacked: Energy industry’s 

controls provide an alluring target for cyberattacks’’ dated 3/2/2017 ....... 6 

Citizens for Responsible Energy Solutions: 

Statement for the Record ................................................................................. 196 

Dahlmeier, Hon. Linda: 

Letter for the Record ........................................................................................ 202 

(The) Hydropower Reform Coalition: 

Statement for the Record ................................................................................. 205 

Imhoff, Carl: 

Opening Statement ........................................................................................... 79 

Written Testimony ............................................................................................ 82 

Responses to Questions for the Record ........................................................... 157 

Koplin, Hon. Clay: 

Opening Statement ........................................................................................... 21 

Written Testimony ............................................................................................ 24 

Responses to Questions for the Record ........................................................... 123 
Page

IV 

Leahey, Jeffrey: 

Opening Statement ........................................................................................... 27 

Written Testimony ............................................................................................ 30 

Responses to Questions for the Record ........................................................... 126 

Leopold, Diane: 

Opening Statement ........................................................................................... 59 

Written Testimony ............................................................................................ 61 

Responses to Questions for the Record ........................................................... 142 

Murkowski, Hon. Lisa: 

Opening Statement ........................................................................................... 1 

Northwest Public Power Association: 

Letter for the Record ........................................................................................ 213 

O’Sullivan, Terry: 

Opening Statement ........................................................................................... 91 

Written Testimony ............................................................................................ 93 

Responses to Questions for the Record ........................................................... 165 

Trout Unlimited: 

Letter for the Record ........................................................................................ 215 

Zindler, Ethan: 

Opening Statement ........................................................................................... 70 

Written Testimony ............................................................................................ 73 

Responses to Questions for the Record ........................................................... 150 
(1) 

OPPORTUNITIES TO IMPROVE AMERICAN 

ENERGY INFRASTRUCTURE 

TUESDAY, MARCH 14, 2017 

U.S. SENATE, 

COMMITTEE ON ENERGY AND NATURAL RESOURCES, 

Washington, DC. 

The Committee met, pursuant to notice, at 10:05 a.m. in Room 

SD–366, Dirksen Senate Office Building, Hon. Lisa Murkowski, 

Chairman of the Committee, presiding. 

OPENING STATEMENT OF HON. LISA MURKOWSKI, 

U.S. SENATOR FROM ALASKA 

CHAIRMAN. Good morning. The Committee will come to order. 

I want to thank, not only our committee members, but our witnesses that are here today. Some people have suggested that perhaps today is not a good day to be at work. I think it is a great 

day to be at work. 

[Laughter.] 

And appreciate the inconveniences some may have gone through 

to make sure that we are beginning this hearing to discuss infrastructure as it relates to the energy sector. 

Senator Cantwell and I were just remembering that, I believe, 

we were the only committee operating when we had a big snow 

dump last year. The hearing at that point in time was to focus on 

issues of the Arctic. We will have an opportunity to talk about that 

a little bit more as it relates to infrastructure as well. This is our 

first hearing on infrastructure in this new Congress. I am certain 

it will not be our last. 

We are planning today to look at lands, water and resourcerelated infrastructure, well, that will come next week, and then infrastructure will also be a prominent theme at hearings we have 

planned on our foreign mineral dependence, cybersecurity and 

other issues. 

What I hope we can all agree on, through all of these hearings, 

is the types of infrastructure within our committee’s jurisdiction 

are critically important to our country’s growth and our prosperity. 

The United States has some of the most robust and reliable energy infrastructure in the world. It allows us to harness energy and 

move it from where it is produced to where it is utilized. Without 

it, there would be no fuel when we pull up to the station and there 

would be no light when we flip on a switch. Energy infrastructure 

is central to our way of life and our standard of living, but it is almost always an afterthought until it breaks down on us. 
2 

We have seen that too often in recent years, making this a perfect time to look at our options to either rebuild, or in many cases, 

build energy infrastructure for the first time. 

The reality is that we have our work cut out for us, but that 

work can be made less difficult, take less time and cost less money 

if we engage in real solutions. 

Much of our nation’s infrastructure is privately owned and maintained. Upgrading it and building new infrastructure is an expensive and time-consuming process. Hundreds of projects, representing billions of dollars of investment are currently navigating 

the federal labyrinth of permitting. Multiple agencies, numerous 

forms and duplicative requirements make this process cumbersome 

and could delay projects for years. 

Of course, the federal permitting process is also layered on top 

of state and local permitting processes with little to no apparent coordination at times, which only adds to the difficulty of getting to 

yes with a project. 

I am glad that the President has made infrastructure a national 

priority. I look forward to working with him and his Administration, as well as members of the Senate, to develop a broad infrastructure package. I certainly hope that package will include provisions that streamline the permitting process for all energy projects. 

President Trump has already taken some notable first steps by 

restoring regulatory fairness for projects like the Keystone XL 

project. 

I had an opportunity last Friday to meet with Prime Minister 

Trudeau. I think it is fair to say that he is pleased that the United 

States is taking another look at this important project. 

But we all recognize that there is a lot to do. Developing and constructing new energy infrastructure projects can help make energy 

cleaner, cheaper and more abundant, and it can have a tremendous 

impact on our rural communities. 

I am pleased that Mr. Koplin, Clay Koplin, the Mayor of Cordova 

and the CEO of Cordova Electric Cooperative, is here with us this 

morning to discuss how energy development in our home state has 

transitioned communities away from diesel power, lowered our 

costs and made energy delivery more affordable. What Mayor 

Koplin has been able to do over the years with his focus on small 

hydro has really made a difference, not only for Cordova, but those 

other communities that look to Cordova as an example. 

I also want to point out that when Congress considers an infrastructure package, our committee will, in many ways, be ahead of 

the curve on a potential contribution to it. During the development 

of our bipartisan energy bill last year we dedicated a significant 

amount of time to these challenges. Our members brought forward 

a number of good ideas to strengthen our energy infrastructure, including streamlining the permitting process for LNG exports, enhancing electricity delivery and improving the regulatory process 

for hydro relicensing and licensing itself. 

I was pleased that we were able to incorporate many of those 

ideas into the bill that passed the Senate last year with 85 votes. 

I am well aware that they are still available to us to enact into law 

in this new Congress. 
3 

I would like to say that energy is good. You all have heard that. 

This morning I would add to it that energy infrastructure is good 

and that it belongs in any conversation that we have about roads, 

bridges and airports. 

This is an important subject and I am, again, thankful that our 

witnesses were able to join us this morning. 

Senator Cantwell, I would welcome your opening remarks. 

STATEMENT OF HON. MARIA CANTWELL, 

U.S. SENATOR FROM WASHINGTON 

Senator CANTWELL. Thank you, Madam Chair. Thank you so 

much for holding this important hearing and to all our witnesses 

for being here today. You should be commended for making your 

way through the snow to help us. 

When Americans wake up in the morning, they flip on the light 

switch, they turn on the hot water in the shower, they grab their 

fully-charged cell phone before heading out the door and fill up 

their cars at a gas station. The average person probably does not 

give much thought to the vast network of energy infrastructure 

that produces, transports and delivers energy to our homes and 

businesses. 

It is not an exaggeration to suggest that our economy, our national security and our way of life depend on the reliable, secure 

and efficient operation of energy infrastructure. And it has served 

our nation well. In fact, the National Academy of Engineers named 

electrification as the greatest engineering achievement of the 20th 

century. 

As the first two installments of the Department of Energy’s 

Quadrennial Energy Review have pointed out, we are facing severe 

challenges that threaten to disrupt America’s access to that reliable 

and affordable energy. 

First, our hydroelectric dams, power plants, electric transmission 

lines and pipelines are aging. The pace of investment has not always been sufficient to keep these facilities in good working order. 

According to the GridWise Alliance, our aging infrastructure is responsible for approximately 25 percent of all power outages in the 

U.S. The Electric Power Research Institute (EPRI) estimates that 

the power outages and reductions in power quality cost the U.S. 

economy as much as $20 billion annually. 

Second, much of our energy infrastructure is also susceptible to 

increasing severe storms, flooding, drought and wildfires. We have 

experienced numerous fires in the Northwest where we have had 

so much burn up, including many transmission lines. It’s a real 

issue, and the Chair and I are going to continue to work on that. 

Third, our electric grid is being stressed, due in part to technology innovations, such as smart appliances and solar rooftops, 

which improve the consumer’s experience but rely on operations for 

which the grid was not originally designed. As we move from oneway to two-way communication, this is a very important issue. 

In addition, we do not have enough electric transmission capacity 

to access the growing demand for electricity from remotely-located 

wind and solar farms, which are now cost-competitive with conventional electric generation. 
4 

Finally, there is the issue of cybersecurity that keeps me up at 

night thinking about potential hacks from Russians or foreign actors, as we see large-scale attacks happening in other places. If we 

do not make the necessary investments to prevent and defend 

against and minimize the impact of these cyberattacks, our enemies may succeed in causing a widespread blackout or devastation 

to our economy that is so important to millions of Americans. 

Chairwoman Murkowski and I put together a bipartisan energy 

bill last year that made needed investments in our energy infrastructure and our workforce and doubled the amount of funding to 

protect us against cyberattacks and improved the security of our 

energy supply chain. We need to know where these products are 

coming from. We passed that bill 85–12 and then spent several 

months negotiating a conference report with the House. 

Unfortunately, Speaker Ryan and the House of Representatives, 

in my opinion, dropped the ball in implementing this important energy legislation that would have helped our country move forward. 

I hope this year the Speaker will finally recognize that protecting 

our electricity grid and making needed investments requires serious attention. 

Today, I am also calling on the Trump Administration to protect 

the public from growing cyber threats that Russia and other foreign actors pose against our energy assets. That is why today, I am 

sending a letter to make sure that we clarify the DOE’s role as a 

lead agency in our nation’s cybersecurity matters, both on the defense side and on the response side, to hacking of our critical energy infrastructure. This is very important because we have heard 

rumors the President may issue an Executive Order expanding the 

Department of Homeland Security’s role in this matter. I equate 

this to seeking medical attention and seeing a doctor, when in reality you need a dentist, because what you have is an oral problem. 

We need the right experts doing the right things to protect us. 

Although digitization of the grid offers tremendous benefits, it 

also makes the grid more susceptible to cyberattacks. This particularly troubling issue increases the concerns that we have about foreign actors and their capabilities of doing significant damage to the 

grid. 

As Admiral Rogers, Director of the NSA and the Commander of 

the U.S. Cyber Command during the Obama Administration, recently told Congress, ‘‘Russia holds the cyber capability to cripple 

our infrastructure.’’ And according to a recent NBC News report, 

the Russians have conducted more than a dozen significant 

cyberattacks against foreign countries, including the U.S. In addition, the Department of Homeland Security and the FBI recently 

published a Joint Analysis Report documenting Russian malicious 

cyber activity in the United States. 

We all know that they hacked into three Ukraine distribution 

utilities knocking power out to more than 225,000 customers. It appears that might have been done again two months ago, when a 

utility in northern Kiev reported that the grid was brought down 

as a result of a cyberattack. 

Fortunately, the U.S. has not yet been successfully attacked that 

way. But we do know that there are frequent attempts to hack our 

utility systems. Just recently the Houston Chronicle published a re-
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port about our U.S. oil and gas pipelines and how susceptible they 

are to hackers using new malware that disrupts the control system. 

The story goes on to detail that these hackers could increase the 

flow of oil and gas in the manner that could potentially cause an 

explosion. 

Madam Chair, I would like to enter that article in the record. 

CHAIRMAN. Accepted. 

[The information referred to follows:] 
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Senator CANTWELL. Thank you. 

Our grid and our economy and way of life have increasingly become more dependent on our electricity grid and smart equipment. 

We need to make sure that we are deploying energy in new ways 

safely and efficiently. 

The electrification of our economy requires a more robust, smarter, modern electricity grid to accommodate the 21st century. By reducing overall energy consumption and facilitating consumer access 

to cleaner grid modernization, we also can make improvements in 

the competitiveness of our U.S. economy. 

The World Economic Forum estimates that the digital transformation of the electricity technology will create $1.3 trillion in 

economic value over the next ten years. So to me, it is imperative 

that the U.S. lead in this effort. 

As the Quadrennial Energy Review pointed out, we need to invest in the workforce that’s needed, approximately 200,000 workers 

with STEM skills will be needed for the electricity grid of the future. Our energy bill last year would have created a Department 

of Energy Workforce Advisory Committee to make sure we have 

the curriculum established to get those workers for the future. 

Madam Chair, I look forward to hearing our witnesses on these 

important issues and continuing to make investments in the energy 

infrastructure that we need for our nation. Thank you very much. 

CHAIRMAN. Thank you, Senator Cantwell. 

You remind us about the important issue of cybersecurity, not 

only as it relates to our energy sector, but really, all aspects of our 

economy. But on a morning like today when people are thinking 

about the physical aspects of our energy grid, because I would venture to say that with the snow and ice you have got some power 

lines that are down somewhere, not at my house, but you have got 

some power lines that are down somewhere. When people are inconvenienced or are without what they have come to expect or they 

realize that capacity is limited, it is less, their energy sources, are 

less reliable, they look to us to say what have you done to fix it? 

We are going to have an opportunity to discuss that here this 

morning. 

As I mentioned earlier, Mr. Clay Koplin is the Mayor of Cordova, 

Alaska. He is the CEO of Cordova Electric Cooperative. He has 

come a long way to be here with us this morning and I look to him 

as one of Alaska’s energy experts. I appreciate that you’re with us 

here this morning, Mayor. 

He will be followed by Mr. Jeffrey Leahey, who is the Deputy Executive Director for the National Hydropower Association. We appreciate your leadership in the hydrospace which is very, very important to us. 

Mr. Stefan Bird is with us. He is the Chief Executive Officer for 

Pacific Power. Thank you for joining us. 

He will be followed by Diane Leopold, who is the CEO and President of Dominion Energy. Good morning to you. 

Mr. Ethan Zindler will follow Ms. Leopold, and Mr. Zindler is the 

Head of Policy Analysis for Bloomberg New Energy Finance. Good 

morning. 
21 

Mr. Carl Imhoff is next, the Manager of the Electricity Market 

Sector for Pacific Northwest National Laboratories. We thank you 

for your good work. 

The panel will be rounded out this morning by Mr. Terry 

O’Sullivan, who is the General President of Laborers’ International 

Union of North America. We look forward to your comments as we 

talk about energy and those workers that provide these opportunities for us. 

With that Mayor Koplin, if you want to lead off the panel and 

we will just go through. I would ask each of you to keep your remarks to no more than five minutes. We do have a larger panel 

than usual this morning, but your full comments will be incorporated as part of the record. Thank you. 

STATEMENT OF HON. CLAY KOPLIN, MAYOR OF CORDOVA, 

ALASKA, AND CEO OF CORDOVA ELECTRIC COOPERATIVE, 

INC. 

Mr. KOPLIN. Thank you. 

Good morning, Chairman Murkowski, Ranking Member Cantwell 

and members of the Committee. I’m Clay Koplin, Mayor of Cordova 

and a CEO of Cordova Electric Cooperative and have expertise in 

developing energy infrastructure and the values that it can deliver. 

Cordova is located in Prince William Sound near Anchorage, and 

the community has rebounded from a series of economic disasters 

that defines its resilience. Our current status includes a ranking as 

the 13th largest seafood delivery port in the country and the largest commercial fishing fleet in the State of Alaska. 

Socially it ranks as the number one high school in the state and 

the safest community in the State of Alaska. 

So, energy infrastructure in the community includes a smart grid 

boasting 100 percent LED lighting, 100 percent underground power 

lines with a high renewables contribution. This ascension has resulted from strategic infrastructure investments in a collaborative 

of local partnerships. These successes have attracted the interest of 

the national laboratories and around resilience, smart grid, 

microgrid and demonstration of best practices. 

In 2006 we had 48 inches of rain in three days and fortunately 

FEMA showed up with a federal disaster declaration that allowed 

the project to rebuild and make you whole. And then FERC showed 

up to assist and regulate. 

The problem is those two lead agencies and their inherent conflict were followed by a regulatory dog pile that kind of left Cordova Electric at the bottom of the stack holding the football. Fortunately, Senator Murkowski’s office and her staff got everybody back 

onto the field, playing as a team, and after five long years and $22 

million, had us to the finish line and our project back in operation. 

But on a positive note, during that flooding our 100 percent underground power lines allowed not a single outage in the community. 

So, what are the ways that we could improve the way that we 

develop infrastructure? Execute local game plans to add resilience 

and value; invest in projects, not in processes; and promote federal 

facilitation to deliver higher value from these projects. 
22 

I give you an example of a local game plan of converting to 100 

percent underground power lines. And that’s just an example in the 

tens of millions of dollars of social value that that added to our 

community of a local initiative. 

But we also need a federal role of investing in projects by participating in both funding the infrastructure, but also sending experts 

in the field to derive value, not only from the projects themselves 

but for their own agencies. The whole team has to take the field. 

Now we can’t just have blockers out on the field while we have the 

quarterbacks and the salary cap stars strategizing and criticizing 

from the sidelines. 

Cordova Electric’s two initial hydroelectric projects had construction timelines and costs doubled during construction due to regulatory posture and a lack of accountability. These projects should 

have been developed by a team effort working in the field together 

right through the final whistle on the project. The dated traditional 

approach is to craft a perfect game plan for success. Now the problem is that injuries and fouls and other teams’ changes in strategy 

undermine that plan. 

So what we need is an agile approach that expects those kinds 

of fouls and injuries and tricks by the other team and relies on the 

agility, the talent and the close communication between the team, 

including the federal agencies that can coach us to quickly adapting to changing conditions. 

There’s a football team a little north of here in Foxboro, Massachusetts that’s perfected that adaptation game, and I think there’s 

some lessons that we might be able to learn in our infrastructure 

investments. 

Cordova is poised to proceed with a Crater Lake Water and 

Power Project right now that’s been designed to build an agile team 

and an agile project management structure. It will probably succeed with or without federal assistance to deliver water to a growing industry, renewable energy, emergency and commercial water 

supply, recreational, educational, self-sufficiency and commercial 

business opportunity value streams all from one project. That’s the 

kind of shared cost/shared benefit projects that we should be looking at with our infrastructure investments and it exemplifies Cordova Electric’s aspiration to be a leader in environmental stewardship in a new age of energy. 

The project probably would be under construction now if hydro 

had been classified as renewable and we had access to the crab 

spawning to build it, but we’ll use RUS and other mechanisms to 

get the project built. We want to finance this long-life asset for a 

sustained, balanced score card return on investment of all those 

value streams. 

Unfortunately, the concept of a public/private partnership may 

not work so well for energy infrastructure investments, like we’d 

hope. Private equity tends to price to risk, and unfortunately, regulatory is one of the biggest risks of building a project. 

In summary, I encourage local, strategic game plans that make 

sense investing in both financial and agency staff resources out in 

the field so that we can have successful outcomes for all players 

and which will consistently deliver the better social, economic and 

environmental values that we all want from these projects. 
23 

Thank you for this opportunity to testify. I’d encourage any questions you might ask and I’d strongly encourage a field hearing in 

Cordova so that you can actually see these solutions and successes 

on the ground and not just hear about them. 

Thank you. 

[The prepared statement of Mr. Koplin follows:] 
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CHAIRMAN. Thank you, Mayor. We will look at the opportunity 

for my colleagues here. The Mayor has indicated this is great little 

community with safe, good schools. It is also without access to the 

road system. Population about— 

Mr. KOPLIN. 2,300. 

CHAIRMAN. 2,300 people. 

But when you think about what it means to take a community 

of 2,300 people off of diesel and put it on renewable available 

hydro, it makes all the difference. 

Sorry, I do not mean to be editorializing, I just get excited about 

Cordova because it is a great community. 

Senator FRANKEN. Sounds like a great place for a field hearing. 

CHAIRMAN. I think that is a wonderful suggestion, Senator 

Franken. We might have to take the Mayor up on that. 

Let’s go to Mr. Leahey. 

STATEMENT OF JEFFREY LEAHEY, DEPUTY EXECUTIVE 

DIRECTOR, NATIONAL HYDROPOWER ASSOCIATION 

Mr. LEAHEY. Good morning, Chairman Murkowski, Ranking 

Member Cantwell and members of the Committee. I am Jeffrey 

Leahey, Deputy Executive Director of the National Hydropower Association (NHA). I’m pleased to be here to discuss the importance 

of hydropower to the U.S. electric system, its untapped growth potential and the policy issues that need addressing to realize that 

growth. 

Today our existing U.S. hydro fleet is made up of almost 2,200 

plants and provides six to seven percent of all U.S. electricity and 

close to half of all renewable generation, making hydropower the 

single largest provider of renewable electricity. In addition, another 

42 pump storage plants make up almost 97 percent of U.S. energy 

storage. The system also contributes to cleaner air and provides 

other benefits including river management for fish and habitat protection, flood and drought management, water supply, irrigation 

and others. Hydro also provides many grid benefits, peaking generation, load following, reliability and more. With the growing need 

for these services, U.S. hydropower has expanded in recent years 

with a net capacity increase of close to 2,000 megawatts since 2005. 

Hydro projects also bring economic benefits where they are located. The industry employs a sizable workforce of 150,000 and access to low cost, clean, reliable power attracts many high-tech firms 

and manufacturers to regions with hydropower. 

And hydro can do even more. The myth is that hydro is all 

tapped out. However, I urge the Committee to review the new hydropower vision report by the Department of Energy released last 

year. It highlights the significant potential to expand U.S. hydropower with the right policies in place. Fifty gigawatts of growth is 

possible by 2050. 

For example, only three percent of our 80,000 dams generate 

electricity. A 2012 assessment found over 12 gigawatts of potential 

with eight gigawatts available at the top 100 sites. Eighty-one of 

the top 100 sites were located on Corps of Engineers’ dams. 

Some projects though, are not pursued over concerns about the 

uncertain, duplicative and lengthy licensing process. For example, 

one NHA member reports that their new project at a Corps dam 
28 

in Iowa will come online in 2018 having started development in 

2005, 13 years earlier. 

Turning to existing hydro projects, owners can get more power 

out of their plants through upgrades in efficiency improvements. 

This allows for increased generation and can have added benefit of 

improved environmental performance. 

Looking at pump storage, these projects can rapidly shift, store 

and reuse energy when there is corresponding system demand and 

facilitate the integration of intermittent, renewable resources. As 

more intermittent generation is added to the grid, the need for 

pump storage is increasing. Right now, about 15,000 megawatts of 

proposal are before FERC. 

However, Congress needs to address the challenges existing asset 

owners and developers face. Water is a public resource and the industry recognizes the need for thorough project reviews. But the 

process can be a cause of delay. 

Again, using non-powered dams as an example, FERC issues the 

license but construction cannot begin until other approvals from 

the federal dam owners are in place. Processes like these and others are not always coordinated, are sequential rather than in parallel. 

Also holding back hydro is its limited recognition or lack thereof 

as a renewable. State renewable portfolio standards and other environmental markets often contain restrictions on the amount of eligible hydropower. 

Federally, programs for renewable energy procurement or development on public lands either exclude hydro completely or restrain 

its participation. When hydro is not valued as a renewable it creates economic disadvantage. The renewable energy tax credits are 

a clear example. 

The 2015 PATH Act creates a competitive imbalance between 

wind and solar and other renewables. The hydropower credits were 

extended through 2016, now expired, while the wind and solar 

credits were extended for years longer. Competing for investment 

dollars, this tipped the scales against hydropower. 

NHA also highlights R&D investment for technology innovation. 

The DOE Water Power Office is one of the smallest in the Department, and the hydropower R&D program routinely receives the 

least funding followed closely by the marine energy program. 

One last policy area to consider is that of regional electricity 

markets. Often the grid benefits of hydro and pump storage are not 

valued and compensated under existing power markets, and project 

proponents do not receive the full benefit of the services they provide. 

While my testimony today focused on hydro’s benefits and growth 

opportunities, I want to take a moment on dam safety. 

As with other infrastructure, U.S. dams and its associated infrastructure are aging and in some cases, are in need of reinvestment. 

However, it is important to note that hydropower dams are highly 

monitored and regulated by FERC or the federal dam owners 

themselves. The hydropower industry believes protecting lives and 

property are the top priority and we work cooperatively with 

FERC’s division of dam safety and inspections. 
29 

NHA also has a committee of ONM and Dam Safety professionals who discuss technical information and best practices and 

we run our operational excellence program. This web-based tool 

shares information across the industry so asset owners can learn 

from one another to meet the highest standards of performance. 

Certainly, NHA supports continued investment in both the civil 

works and power sides of the industry as part of any discussion 

into hydropower infrastructure needs. 

With that, let me conclude and thank the Committee for this opportunity to testify and I look forward to your questions. 

[The prepared statement of Mr. Leahey follows:] 
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CHAIRMAN. Thank you, Mr. Leahey. 

Let’s go to Mr. Bird. Welcome. 

STATEMENT OF STEFAN BIRD, PRESIDENT AND CHIEF EXECUTIVE OFFICER, PACIFIC POWER, A DIVISION OF PACIFICORP 

Mr. BIRD. Chairman Murkowski, Ranking Member Cantwell and 

members of the Committee, I greatly appreciate the opportunity to 

appear before you today as you consider the need for investment 

and modernization of U.S. energy infrastructure. 

My name is Stefan Bird, and I’m the President and CEO of Pacific Power. Pacific Power, together with Rocky Mountain Power, 

comprise PacifiCorp which together serve 1.8 million customers 

across six Northwestern states. PacifiCorp owns and operates a diverse portfolio of resources totaling approximately 11,000 

megawatts and includes hydroelectric power, coal power, natural 

gas, geothermal, wind and solar and biomass resources. We integrate those resources and serve our customers across the largest, 

privately-owned grid in the Western U.S. that totals 16,500 miles 

of high voltage transmission across ten Western states. 

Your opening comments, Chairman Murkowski and Ranking 

Member Cantwell, were right on point, certainly in regard to the 

need for transmission infrastructure investment. And so, I’m going 

to abbreviate my opening comments and really move to the focus 

of my comments this morning in regard to streamlining and modernizing our permitting structure to keep pace with our need for 

advancements in energy infrastructure. 

As the largest transmission owner in the Western U.S., 

PacifiCorp has long supported measures to better coordinate the 

existing federal permitting and citing processes from major electric 

transmission projects on public lands to reduce the uncertainty for 

project applicants and to streamline the approval process. 

For the past ten years, we’ve been actively permitting several stages of a $6 billion, 2,000-mile transmission infrastructure expansion, we call Energy Gateway. And some of those stages are already constructed and operating. 

The purpose of Energy Gateway is to improve reliability and access to some of the lowest cost renewable resources in the Western 

United States. An important benefit is the hundreds of living wage 

construction jobs and the millions of dollars in property and sales 

tax revenue these projects contribute to the communities they are 

cited. 

To give you an idea of the delays we experience, consider the 

record of decision we received on the last day of the previous Administration for our Gateway West transmission segment. It described the long and torturous review and approval process beginning with our initial application in May 2007, almost ten years for 

a project designed to bring clean energy to our customers and to 

relieve congestion constraints on our system. Without PacifiCorp’s 

Energy Gateway and other regional transmission projects, which 

must cross public lands, some of our nation’s largest and best energy resources will remain unable to contribute as they wait for 

transmission lines to be cited and built. 

The most critical path items to achieving this objective is schedule predictability within the federal permitting process. To achieve 
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this goal, we believe an effective federal permitting process should 

have: A, a single point of accountability establishing a lead agency 

rather than having the company deal with multiple agencies; B, 

have clear and permanent deadlines—changing deadlines by bureaucrats render business decisions uneconomic and meaningless; 

and C, avoiding redundant and unnecessary views every time 

there’s a new government policy change, essentially grandfathering 

of prior action. In other words, as new policies and guidance are 

rolled out, the new policy guidance should clearly state that 

projects already under NEPA review are grandfathered under the 

policy in place at application. Ten years to permit a transmission 

infrastructure project, by any measure, is far too long. 

While building new, modern infrastructure is vital to our nation’s 

economic goals. It is also critical to keep trees away from power 

lines. We believe that integrated vegetation management is an environmentally sound and cost effective way of keeping trees from 

power lines and we suggest the Forest Service adopt a policy of integrating, utilizing integrated vegetation management on federal 

lands throughout the country. 

To provide an understanding of how difficult it can be to obtain 

permission and access to provide necessary vegetation management, my company’s facilities cross 33 different national forests. 

Each national forest is divided into three or four districts, each 

with independent decision-making authority. That means 

PacifiCorp foresters may have to work individually with well over 

100 different governing authorities for the U.S. Forest Service 

alone. Add that to the number of regions of the BLM, National 

Parks and Federal Wildlife Refuges, and one can understand how 

working with federal agencies can be so uncertain and time consuming. 

Investment in new transmission systems, upgrading older systems to be smarter and more efficient and accessing and maintaining the grid means energy security, economic opportunity and good 

jobs and wages for our country. 

PacifiCorp wants to be part of creative and collaborative solutions that will help create the next American infrastructure expansion. 

I want to thank you again for the opportunity to participate in 

this hearing. PacifiCorp and Berkshire Hathaway Energy look forward to working with you further on these important issues. 

[The prepared statement of Mr. Stefan Bird follows:] 
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CHAIRMAN. Thank you, Mr. Bird. 

We next turn to Ms. Diane Leopold. Welcome to the Committee. 

STATEMENT OF DIANE LEOPOLD, PRESIDENT AND CEO, 

DOMINION ENERGY, DOMINION RESOURCES 

Ms. LEOPOLD. Good morning, Chairman Murkowski, Ranking 

Member Cantwell and Committee members. I am Diane Leopold, 

President and CEO of Dominion Energy, the natural gas unit of 

Dominion Resources. I also chair the Interstate Natural Gas Association of America, although, I am not here in that capacity. 

Thank you for inviting me to testify on the immense and welldocumented economic, environmental and security benefits of expanding America’s energy infrastructure. These investments improve our quality of life, global competitiveness and national security. 

Our projects employ private capital, not taxpayer dollars. Domin- ion alone is working on about $16 billion in infrastructure projects. 

However, to make these beneficial investments we need certainty 

from federal agencies, not a rubber stamp, but a rational path forward with clear processes, reasonable schedules and reasonable decisions. The result will be a cleaner environment, lower electricity 

and natural gas bills for consumers and businesses and more economic opportunity. Three of our projects illustrate the opportunities and challenges. Our $4 billion Cove Point Natural Gas Liquefaction Project is an 

addition to an existing LNG import terminal in Maryland. It has 

3,700 workers on-site, including 3,000 skilled craft professionals. 

This exceeds the original forecast. Thousands more new jobs will 

come from producing, processing and transporting natural gas to 

the terminal and there will be $40 million annually in new local 

taxes. Cove Point will provide a small portion of America’s abundant natural gas to India and Japan, two vital, global partners. 

This strengthens our global footprint and reduces their dependence 

on less friendly gas producing nations. Shipments from Cove Point 

will reduce the U.S. trade deficit by about $5 billion while having 

a negligible impact on domestic energy prices. 

Federal and state permitting took about three and a half years, 

requiring more than 55 federal, state and local permits and reviews. This exhaustive process now looks simple compared with 

what we faced with the much-needed Atlantic Coast Pipeline, or 

ACP. ACP is a $5 to $5.5 billion, privately financed, 600-mile, underground utility project. Starting in Senator Manchin’s home state 

of West Virginia, it will bring gas from the Appalachian region to 

Virginia and North Carolina. 

Local electric and natural gas utilities urgently need more natural gas. Today, large business customers must have service curtailed on very cold days so residential customers won’t literally be 

left out in the cold. Lack of natural gas is also slowing the shift 

to cleaner electricity and is strangling economic development. 

Two independent economic studies make ACP’s case. One 

projects over 17,000 construction jobs. The other estimates $377 

million in annual savings on utility bills resulting in more disposable income, a stronger economy, better quality of life for families 

and businesses, large and small. 
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ACP requires more than 18 major federal permits and authorizations, plus numerous other federal, state and local approvals. The 

process is already approaching three years and has a September 

28th deadline to complete federal authorizations. A date that is 

later than it needed to be and not as certain as it should be. 

To understand the delays, let me share some examples. 

To protect the view from the Blue Ridge Parkway and Appalachian National Scenic Trail, we proposed boring under a mountain for nearly one mile using a much more costly method to ensure 

no disturbance or interference with the parkway or trail. The National Park Service took 14 months to review our 22-page application just to survey. We’re still waiting for a decision on construction. And 21 of the 600 miles of ACP will cross national forests, 

just as hundreds of miles of natural gas pipelines run safely 

through national forests today. We rerouted 95 miles to meet its 

concerns though the Forest Service continues to move the goal 

posts with changing requirements and standards. 

Similarly, our Skiffes Creek electric transmission line has been 

under Army Corps of Engineer’s review for five years. The line is 

needed to provide reliable electricity on the Virginia peninsula 

when two aging coal units close to meet EPA regulations. This region hosts the world’s largest shipyard, as well as eight military 

and DOE facilities. 

Unfortunately, the Corps has not been able to complete the required consultation with the Advisory Council on historic preservation, the National Park Service and other parties. The project neither directly impacts Park Service lands nor requires a Park Service permit. 

We were encouraged by the provisions of this Committee’s legislation the Senate approved last year to help critical infrastructure 

projects advance. In particular, we support concurrent NEPA review by FERC and other permitting agencies, including agencies 

working with FERC’s extensive NEPA process, rather than conducting duplicative reviews. 

We also support an expectation that agencies notify applicants 

when their permits are complete to help stay within the timeline. 

Chairman Murkowski and members of the Committee, the energy industry is poised to accelerate development of critical infrastructure serving the national interest. We’re dedicated to safety 

and environmental protection. We believe in transparency and following regulatory processes. But to commit billions in private capital, we need a reasonable regulatory path to success if we follow 

the process. 

Thank you. 

[The prepared statement of Ms. Leopold follows:] 
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CHAIRMAN. Thank you, Ms. Leopold. 

Mr. Zindler, welcome. 

STATEMENT OF ETHAN ZINDLER, HEAD OF AMERICAS, 

BLOOMBERG NEW ENERGY FINANCE 

Mr. ZINDLER. Thank you. 

I’m going to move a little quickly and skip some of the early remarks to make sure I finish on time here. 

And thanks for the opportunity, once again, to participate. 

I am here today in my role as an analyst for Bloomberg New Energy Finance, which is a division of the financial information provider, Bloomberg LP. My remarks today represent my views alone, 

not the corporate positions of Bloomberg LP and of course, they’re 

not investment advice. 

My testimony today will focus on the next generation of energy 

technologies and the infrastructure that will be critical to accommodate them. I think there are many on the panel here who can 

talk in real depth and expertise about our current challenges so I’ll 

try not to be redundant with those. 

The U.S. is transforming how it generates, delivers, and consumes energy. These changes are fundamentally empowering businesses and homeowners, presenting them with expanded choices 

and control. 

Consumers today can, for instance, analyze and adjust their 

heating, air-conditioning and electricity use over their smart 

phones thanks to smart meters and smart thermostats. 

Consumers in much of the country can choose their electricity 

supplier and may opt for ‘‘green choice’’ plans. They can produce 

power themselves with rooftop solar photovoltaic systems. They can 

even store it locally with new batteries. 

Consumers can choose to drive vehicles propelled by internal 

combustion engines, electric motors or some combination of both of 

those. And that car can be powered by gasoline, by diesel, electricity, ethanol, perhaps even methanol, natural gas or hydrogen, 

and electric vehicle drivers who own homes can turn their garages 

into fueling stations simply by using the outlet on the wall. 

Realistically speaking, few Americans today have the inclination 

or income to become high-tech energy geeks, but that is changing 

as prices associated with these technologies plummet. In the case 

of electric vehicles, such cars can be appealing simply because they 

perform better. 

We at Bloomberg New Energy Finance believe that further 

growth and eventual mass adoption of these technologies is not 

possible, it’s not probable, but it’s inevitable given rapidly declining 

costs. 

For instance, the price of a photovoltaic module has fallen by 90 

percent since 2008, to approximately 40 cents per watt today. For 

millions of U.S. businesses and homeowners, ‘‘going solar’’ is already an economic decision, and last year the U.S. installed far 

more solar generating capacity than it did any other technology. 

By the end of the next decade, cost competitiveness for distributed solar will arrive most places in the United States and without 

the benefit of subsidies. 
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Similarly, the value of contracts signed to procure U.S. wind 

power have dropped by approximately half as the industry has deployed larger and more productive wind turbines. Wind, last year, 

surpassed hydro-electricity to become the fourth biggest generator 

in the U.S. We expect current wind capacity to at least double by 

2030. Many of these new energy technologies are, of course, variable. In other words, if there’s no wind, there’s no wind power. If 

there’s no sun, there’s no solar-generated power. Thus, the growth 

in these and other new energy technologies will be accompanied by 

unprecedented sales of new batteries of various shapes and sizes. 

Utilities such as Southern California Edison and others have already begun piloting large-scale batteries in certain markets while 

providers such as Stem and Tesla offer so-called, ‘‘behind-themeter’’ storage solutions for businesses and homeowners. 

In the past five years, lithium-battery prices have fallen by at 

least 57 percent and we expect another 60 percent drop by 2025. 

That will contribute to 9.5 gigawatt/hours of battery capacity in the 

U.S., up from 1.7 today. 

Continuing battery price declines will also make electric vehicles 

for the first time a viable option for middle-class U.S. consumers 

without the benefit of subsidies. 

The new, empowered consumer poses inherent challenges to the 

traditional command-and-control/hub-and-spoke models of conventional power generation and power markets. We have already seen 

examples around the globe where incumbent utilities were caught 

flat-footed by rapid clean energy build-outs. In some cases it has 

been heavy subsidies for renewables that have catalyzed this 

change, but more recently, simple low costs are allowing wind and 

solar to elbow their way onto the grid. 

So, where does this leave infrastructure in this conversation? 

First, conceptually, we must accept that the empowered consumer 

is here to stay. To some degree, this acceptance is already underway in the private sector where companies that once focused mainly on large-scale power generation are merging with consumerfacing utilities or buying smaller solar installers and battery solution providers. And second, policymakers should look to promote 

infrastructure that accommodates a new, more varied, more distributed world of energy generation and consumption. 

Policy-makers may also seek to facilitate the development of 

high-voltage transmission lines across the U.S. It has long been an 

adage that the U.S. is the home to the ‘‘Saudi Arabia of wind’’, but 

a lot of that resource might as well be in Saudi Arabia given how 

difficult it can be to build across state transmission. 

Investment is also needed at lower voltages as well. Our passive, 

one-directional, electricity distribution system is under strain as 

new distributed generation capacity comes online. 

Now finally, policymakers may consider ways to support electric 

vehicle charging stations. As sales of such cars grow, consumers 

are already putting greater pressure on certain distribution nodes 

around the country. 

And lastly, the changes afoot will require what might be best 

described as infrastructure software. Most importantly and 

pressingly, this must include the reform of electricity markets to 

take into account the new realities of 21st century power and sup-
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ply and demand. It may also include expanded programs to educate, excuse me, educate energy professionals to the new realities 

of the energy markets. And, yes, of course, it could include some 

forms of software to improve energy monitoring and optimize system performance. 

In closing, I would reiterate that none of this needs be done at 

the exclusion of investing in traditional energy infrastructures 

being discussed by others on the panel; however, any rational discussion about energy infrastructure today must do more than take 

into account the current situation. It must also consider where 

we’re going to end up tomorrow. 

Thank you. 

[The prepared statement of Mr. Zindler follows:] 
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CHAIRMAN. Thank you, Mr. Zindler. 

Mr. Imhoff, welcome. 

STATEMENT OF CARL IMHOFF, MANAGER, ELECTRICITY MARKET SECTOR, PACIFIC NORTHWEST NATIONAL LABORATORY 

Mr. IMHOFF. Thank you and good morning. 

Thank you, Chairman Murkowski and Ranking Member Cantwell and also the Committee members for the leadership of this 

Committee in helping drive the nation’s energy future forward. 

My name is Carl Imhoff. I lead the Grid Research Program at 

the Pacific Northwest National Laboratory (PNNL) in Washington 

State. I also Chair, jointly with NREL, the DOE Grid Modernization Laboratory Consortium. It’s a group of 13 national labs that, 

along with over 100 partners from industry, industry groups such 

as Gridwise Alliance and universities, supports the Department’s 

Grid Modernization Initiative. 

PNNL has long supported the power system innovation and reliability for the Northwest and for the nation. 

The laboratory led DOE industry collaborations in deploying next 

generation transmission sensors to help avoid blackouts, and in 

California alone avoided outages result in an estimated savings of 

about $360 million annual to consumers. 

PNNL also led a demonstration to test transactive control in the 

Pacific Northwest validating smart grid benefits and new control 

approaches of Avista Corporation in Spokane, who also has a footprint, and consumers in Idaho and Alaska. They implemented a 

distribution automation and smart metering projects that reduced 

consumer outages by ten percent, shortened the duration of those 

outages by 21 percent and delivered 1.5 million avoided outage 

minutes in just the first year of operation. 

These two examples illustrate some of the high return on investment achieved by utilities and national labs across the country 

when combining their efforts and new infrastructure innovation 

with private, public validation. 

The DOE grid modernization initiative is an important source of 

innovation for the nation’s efforts in terms of modernizing infrastructure. It’s an innovative cross-cut effort spanning multiple DOE 

program offices, develop new concepts, tools, platforms and technologies to support grid modernization. A portfolio of ADA projects 

was funded for up to three years, beginning in FY’16. 

Today I offer three primary points. First, that the electric sector 

is fundamental to a secure energy infrastructure and it’s comprised 

of 21st century assets that go well beyond steel and concrete. Secondly, the electric infrastructure is changing dramatically and a 

modern grid requires the addition of a new metric, a metric of flexibility to add to the pantheon of reliability, affordability and security. Grid flexibility will be vital to an effective infrastructure in 

the future. And then third, there are substantial opportunities for 

low hanging fruit, if you will, of improving the infrastructure via 

public/private partnership. And I’ll share some examples for these. 

The grid infrastructure spans the nation providing essential services to the U.S. economy through over three and a half thousand 

utilities, but it also serves small, remote communities that must 
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provide, oftentimes, their own electric services predominately 

through local diesel generation and microgrids. 

The new digital revolution is increasingly important to our economy creating new consumer services, businesses and jobs. But 

there is more to infrastructure than cables, towers and generators. 

Utilities rely on major control centers to operate the power system, 

requiring investment in software, communications and controls. 

Sensor networks that provide real-time sensing, both locally and 

across entire interconnections, are emerging to dramatically improve reliability and asset management. 

Finally, utilities, vendors, universities and DOE laboratories 

maintain a network of research and testing and workforce training 

infrastructure necessary to support the revitalization of the grid. 

These 21st century assets are as critical as towers and wires when 

it comes to electric infrastructure modernization. 

Trends toward distributed resources and the smart grid edge and 

reshaping utility business models as well. Today we have about two 

billion intelligent, connected devices at the edge of the grid. Utilities expect that to grow to 20 billion by 2025 and one of the big 

challenges is a number of those devices will be on the customer 

side of the meter, outside the direct control of utilities. So, it’s 

changing dramatically, the business model. 

Second, the emerging of distributed resources is accelerating faster than many in the industry expected it to. It includes distributed 

generation like photovoltaics, smart loads, demand response, electric vehicles and energy storage. These changes collectively require 

the grid to become more flexible and yet deliver more flexibility to 

a combination of better generator controls, better coordination 

across the boundary between transmission and distribution to engage smart loads at scale and energy storage. 

Finally, the proliferation of internet and digital devices throughout our economy has increased the challenges of cyberattack on the 

electric infrastructure. The electric grid is under regular reconnaissance and cyberattack activities from both foreign-state and nonstate actors. 

The electric industry, in partnership with the government, has 

responded strongly to address these challenges including improving 

best practices through self-assessment and launching the Electric 

Sector Coordinating Council. In addition, PNNL developed the 

Cyber Risk Information Sharing Program (CRISP) with DOE and 

is now supporting NERC in the deployment of the program to utilities nationwide. The CRISP program provides cyber threat intelligence to identify tactics, techniques and procedures used by advanced threat actors from nation states as well as professional 

hackers. 

In closing I offer three recommendations. First, consider in your 

deliberations adding the metric of grid flexibility to the fundamental metrics for outcomes for the grid of the future. Second, leverage the recent substantial base of successful demonstration system demonstrations that jump start the electric infrastructure 

modernization. Topics that have a wide base of lessons learned in 

successful business case development include, distribution automation, advanced metering, conservation of voltage reduction and the 

use of distribution management system software. 
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This last item is what enables utilities to know where outages 

are. Today, more than half of our utilities still have to wait for a 

phone call to inform them of an outage and broadening the penetration of distribution management system software would have 

great impact. 

And then lastly, include public/private partnership to conduct infrastructure pilots at the regional level. These pilots can rapidly 

validate the emergency new modernization concepts and tools 

emerging from industry, the DOE research portfolio and elsewhere. 

With that, I’ll stop. 

Thank you. 

[The prepared statement of Mr. Imhoff follows:] 
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CHAIRMAN. Thank you, Mr. Imhoff. 

Mr. O’Sullivan, welcome to the Committee. 

STATEMENT OF TERRY O’SULLIVAN, GENERAL PRESIDENT, 

LABORERS’ INTERNATIONAL UNION OF NORTH AMERICA 

Mr. O’SULLIVAN. Thank you very much. 

Chairman Murkowski, Ranking Member Cantwell and members 

of the Energy and Natural Resources Committee, on behalf of the 

500,000 strong, proud and united men and women of the Laborers’ 

International Union of North America (LIUNA), I want to thank 

you for the opportunity to testify here today. It’s both an honor and 

a privilege to do so. 

As the people who build, repair and maintain our nation’s critical 

energy infrastructure, LIUNA members support a reasonable, rational, fact-based, energy policy. We support regulatory reform that 

streamlines the permitting process, allows reviews by separate 

agencies and entities to proceed concurrently and provides for timely, definitive decisions that enable approved projects to proceed 

without delay. 

LIUNA joins others in the energy industry in calling for the swift 

filling of vacant spots on the Federal Energy Regulatory Commission. 

LIUNA also supports the responsible exploration and development of energy resources within the Arctic National Wildlife Refuge, ANWR. 

Permitting energy production on just one-tenth of one percent of 

ANWR’s total acreage will create tens of thousands of good paying, 

family supporting jobs over the next few decades. Its royalties, 

lease payments and corporate income taxes will generate billions in 

state and federal revenue that could be reinvested in our failing infrastructure. 

Chairman Murkowski, for decades your state has demonstrated 

that natural resource development can co-exist with nature, building family sustaining careers while maintaining a natural beauty 

of wild places. Your state has shown that there is no need to pit 

jobs against the environment. Yet, on his way out of office, President Obama removed key Arctic and Atlantic offshore areas from 

future leasing, destroying good jobs. LIUNA hopes that Congress 

and President Trump will reverse this, what we consider, a bad decision. 

Developing sound, thoughtful energy policy that takes into consideration the men and women who work in the energy sector 

should be a bipartisan agenda creating millions of new jobs across 

many sectors of the economy while modernizing our vital energy infrastructure and ensuring America’s energy independence. The 

American society, as civil engineers, has given our energy infrastructure a grade of D plus. The men and women of LIUNA and 

other building trades union are eager to go to work to address this 

problem, yet opposition to almost every energy project, especially 

pipelines, has threatened to derail all serious attempts to address 

this issue. 

It also threatens the creation of good, middle class jobs. For 

workers in communities throughout the United States, pipeline 
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projects and other energy projects are lifelines. It’s not the pipelines that are dirty, it’s the politics. Today, LIUNA has more than $50 billion worth of pipeline work 

under contract. Tens of thousands of highly trained, safe, skilled 

building trades members will be put to work for years to come on 

projects such as the Keystone XL pipeline, the Dakota Access pipeline, the Atlantic Sunrise pipeline, the Rover pipeline, Atlantic 

Coast pipeline, Sable Trail pipeline, Penneast pipeline and the 

Cove Point LNG facility that was talked about earlier. And these 

are just the tip of the iceberg. 

Although these jobs, like all construction jobs, are temporary by 

nature, anyone who has a clue about the work we do knows that 

by stringing together one temporary job after another construction 

workers are able to create a career allowing them to provide for 

their families and save for their retirement. At a time when it’s 

harder and harder to succeed without a college education and a 

debt that goes with it, LIUNA and other building trades unions are 

one of the few places where a high school graduate can enter an 

apprenticeship program, learn a trade, become a qualified 

journeyperson and build a rewarding, middle-class career. 

LIUNA does not deny climate change. In fact, we are one of the 

few unions that supported cap and trade legislation. But we take 

issue with ‘‘keep-it-in-the-ground’’ pipeline opponents who ignore 

the reality that these resources continue to be pulled out of the 

ground anyway and transported by means that are riskier and less 

environmentally sound than pipelines. 

Rather than wasting time and resources fighting over individual 

pipeline and energy projects, we believe it’s time to embrace a comprehensive, rational, common sense energy policy that provides for 

the safe and responsible development of all domestic sources of energy, including wind, solar, hydro and nuclear. Unleashing these 

resources will create economic opportunities in communities across 

the country while making us less dependent on energy from nations that seek to undermine the American ideals of freedom and 

liberty. 

Finding realistic, environmentally responsible solutions to our 

energy infrastructure problems isn’t a Republican issue or a Democratic issue. It’s not a conservative issue or a liberal issue. It’s an 

American issue. 

Thank you for the opportunity to offer this testimony. I look forward to any questions you might have and to working with you, 

Chairman Murkowski and with the entire Committee in the future. 

[The prepared statement of Mr. O’Sullivan follows:] 
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CHAIRMAN. Thank you, Mr. O’Sullivan. I think it is a good way 

to wrap up by reminding us that when we are talking about infrastructure, whether it is pipelines, whether it is hydro, whether it 

is what we’re doing with our smart grid, it, at the end of the day, 

is an opportunity for us to create good jobs. 

I think, if there has been a common thread throughout the testimony that we have heard, it is that the regulatory process is one 

that, unfortunately, can yield uncertainty, can yield delays and 

that adds to cost. So I want to just speak to everyone and direct 

my questions in that vein this morning. 

Let me begin with you, Mr. Koplin, and then I will incorporate 

Mr. Leahey in this as well. When we are talking about small 

projects, you mentioned the possibility for Crater Lake there in 

Cordova. What barriers do you have in front of you as you work 

to develop a small scale hydro facility in your community? How can 

Cordova move forward more readily, more quickly, with this from 

a regulatory perspective? If we could clear things out of the way, 

what would it be? 

Mr. KOPLIN. I’m going to give you a little longer answer. 

Our utility co-chairs, statewide co-chair, the State Utility Organization and, in general, the biggest barrier is regulatory to developing any renewable. 

Fortunately for us in this case, we broke down the biggest barrier by getting the site declared by FERC as non-jurisdictional. So 

that gives us the opportunity to, frankly, develop this as an agile 

project and a team that can work together through the finish line. 

Otherwise we wouldn’t be doing it. 

We literally had been told by the Forest Service that it was on 

their land, so we hadn’t even considered this project until we found 

out it was private property. 

CHAIRMAN. Yes, which made all the difference, all the difference 

in the world. 

Mr. KOPLIN. Yup, go or no go. 

CHAIRMAN. Yes. 

Let me ask you, Mr. Leahey, when you provided your testimony 

you talked about the fact that only three percent of the existing 

dams out there are actually electrified. When we think about opportunities, it is not like we need to go out and build a brand-new 

dam here. We have an opportunity to really do so much more with 

what we have in place. 

Now, I understand that FERC and the Corps have entered into 

an MOU to facilitate the development of these non-powered dams. 

Do you think those MOUs are sufficient? Is there more that we can 

be doing here in Congress to help facilitate the electrification aspect? 

Mr. LEAHEY. Sure. 

We believe that the MOU is going to be a step in the right direction and will solve some of the problems, but the problem is generalized for hydro licensing. 

While FERC is the issuer of the license, they are not the only 

ones who are involved. There are many state and federal resource 

agency approvals that are needed in order to get a final approval 

done. We believe all of this, all of those, are important and are part 

of the process, but they’re all independent authorities. 
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And so, it’s very hard to enforce timelines. It’s very hard to provide that certainty either in a relicensing of an existing project or 

a new project going forward. 

With respect to non-powered dams and the Corps facilities, I also 

think there could be some additional work that could be done within the Corps itself in streamlining some of its approval procedures 

to make that internal work that they do, as well as the external 

work, in coordination with the Corps much more coordinated. 

CHAIRMAN. We would like to work with you on defining and outlining that. 

The reality that the hydro sector is facing right now, not only 

with the licensing of a new dam but the relicensing of existing facilities is something that, just, most people would say is mind boggling. Ten years and millions of millions of dollars for a relicensing. 

Now, you compare this with a natural gas plant developer who can 

move through this regulatory process in a couple years. 

Why is it that when it comes to hydro the regulatory process is 

so much more difficult and then the bigger question is what can 

we do to address it? 

Mr. LEAHEY. Right. 

Well, again, as I talked about there are so many different agencies and statutes that are involved in the relicensing of the project 

because water is a public resource and many interests are involved 

in the use of that water, and rightfully so that those people are involved. 

Again, however, coordinating all of that and the meetings and 

the studies and the information that has to be put together to do 

that kind of work takes a lot of time and cost. And if, as Clay mentioned, if people are not all, sort of, rowing in the same direction 

then you can see delays in the process. 

And so— 

CHAIRMAN. Delays and then cost. 

Mr. LEAHEY. And then additional costs. 

CHAIRMAN. Right, yes. 

Mr. LEAHEY. And again, how that lines up with tax credits that 

have short-term extensions that we’ve seen and a process that 

could take five, ten years or longer, provides no certainty to utilities, developers or investors. 

CHAIRMAN. It is absolutely something we have got to work on. 

Senator Cantwell had to take a meeting just briefly, but she will 

be back to the Committee. 

Let’s turn to Senator Franken. 

Senator FRANKEN. Thank you, Madam Chair. 

It seems to me there is something, sort of, looming over this 

whole hearing that should be mentioned. When I read the testimony of the experts gathered here today it was clear that federal 

investments in R&D have paid off handsomely in the past and are 

vital to our continued success as a nation and grappling with our 

future energy needs. 

I believe it was the last hearing we had in this room, we were 

considering the nomination of Rick Perry to be the new Secretary 

of Energy. On that day, it was leaked that the Administration 

planned to gut our federal commitment to energy R&D, a process 

that also severely threatens the energy R&D infrastructure and ex-
100 

pertise that we so carefully built up at our national labs. It is striking me that there is no one from the Administration at this hearing 

today. 

I just am raising that because so much of what we are talking 

about is at least related, in a very strong way, to R&D that has 

been done by the Energy Department. We are in a situation where 

the future of energy and our planet is related to renewable energy. 

We have received testimony on hydro and other renewables, such 

as solar power, and there are all kinds of renewable energy and energy efficiency technologies and energy storage that are part of our 

infrastructure. 

The Chinese are spending $361 billion through 2020 on energy 

R&D, and I do not want them to beat us. I want them buying our 

technology and not us having to buy theirs. But I am very worried 

about this Administration’s commitment to R&D. 

Mr. Zindler, you noted in your testimony that last year we installed more solar capacity than any other electricity generation 

technology. In the past ten years, we have installed more renewable energy capacity than anything else. 

Your company tracks investment and deployment in the clean 

energy sector. In recent years this sector has shown significant 

growth. Do you have a sense of how many people are currently employed in the clean energy sector? 

Mr. ZINDLER. So, well one thing we don’t actually do is count jobs 

ourselves, but there are certainly others that have. One of the estimates from the Solar Foundation, which is an industry group, is 

that they are employing, I think, about 250,000 to 300,000 people 

in the solar industry today. 

Senator FRANKEN. That is solar. 

Mr. ZINDLER. Solar alone, wind another, maybe 90,000 or 

100,000 jobs. 

In terms of the dollars, which is something that we do track, the 

U.S. has attracted over half a trillion dollars in renewable/clean energy investment over the last 10 or 12 years or so which is certainly a lot of money. But in the context of, as you point out, you 

know, China typically is investing about twice that amount per 

year or somewhere in the neighborhood of $100 to $120 billion over 

the last several years. 

Senator FRANKEN. What kind of growth are you projecting in the 

future for solar in particular? 

Mr. ZINDLER. So, I mean, look, we have our own long-term forecast—the EIA does, Shell, others do as well. We’re certainly more 

optimistic and bullish about these technologies than others have 

been, but I’ll also point out we have typically been more optimistic 

and bullish and we’ve been wrong on the low side. In other words, 

there’s been more solar build than people, than most people, would 

have predicted five years ago, already. 

And last year the majority of new investment that went into 

power generating and equipment around the world was in lower 

carbon technologies, not in conventional fossil generation. 

Senator FRANKEN. That is good. 

Mr. ZINDLER. So already that shift— 

Senator FRANKEN. Well, that is good. 
101 

Mr. ZINDLER. That shift is taking place to some large degree. 

And we think, you know, solar represents a very small slice right 

now of generation in the U.S., maybe one to two percent, but we 

think capacity for solar could get up to as high as 25, 27 percent 

over the next 25 years. It’s a long way to go, but it’s also a long 

amount of time to get there. 

Senator FRANKEN. Well unfortunately, I have run out of time 

here, but I just think that we have to continue this commitment 

to doing research and development and including in the valley of 

death and all that stuff we did. We still have the $40 billion in the 

Loan Guarantee Program. I think we should use it. 

I want to thank all of the witnesses today for your testimony. 

Thank you, Madam Chair. 

CHAIRMAN. Thank you, Senator Franken. 

Senator Daines. 

Senator DAINES. Thank you, Madam Chair. 

Ms. Leopold, in your written testimony you discussed the Cove 

Point Project and its importance to bring American energy to allies 

overseas, specifically to Japan and India. 

In Montana, we have more recoverable coal than any state in the 

United States. I am struck by some stats the U.S. Chamber provided a while back that show in the course of the next 33 years, 

between now and 2050, the energy demand in the world will increase by 84 percent from where it is today. We are going to add 

1.6 billion people to the planet. 

The question is how are we going to meet the needs as we look 

at an 84 percent increase in energy demand in the next 33 years? 

Thirty-three years seems like a long ways away until I realize I 

graduated from college 33 years ago, it doesn’t seem that far away 

now. 

Montana coal is low in sulfur content. It is cleaner than Indonesian coal. Our allies would very much like to depend on U.S. resources and natural resources instead of being dependent on countries around the world that are not always friendly. 

Here is some perspective. If you look at the global leaders in fossil fuel resources, the global leaders, number one is the United 

States; number two is Russia; number three, Saudi Arabia; number 

four is China; number five is Iran. Our allies are asking, ‘‘Can we 

depend on you, the United States, for our future energy security instead of these other nations right now’’ that if I were allies, I would 

be very hesitant to continue to develop relationship and dependence on them. 

So I believe energy security is center to our national and economic security. The question is can you discuss the importance of 

expanding access to our allies overseas for abundant American energy resources? 

Ms. LEOPOLD. Thank you, Senator. 

Obviously I’m not an expert on coal export facilities, but what I 

can share with you is while we were negotiating with our partners, 

our customers, for Cove Point in India and Japan, it was a significant piece of what they were trying to look at. It was not solely 

price. It was looking at their long-term national security. When 

they looked at the countries that they could get exported natural 

gas from—Japan does not have a lot of natural resources on their 
102 

own. They must import some type of fuel to be able to meet their 

needs, especially after their nuclear issues. And India is a very 

largely expanding economy and has choices on where they get it 

from. 

Senator DAINES. By the way, on the Japan point, I think, needs 

to be made that there are 2,400 coal-fired plants on the drawing 

board right now. Two-thirds will be in India and China going forward. 

So this nonsense that somehow fossil fuels are going to go away 

in the course of the next 30 years is just, it is nonsense. We are 

either going to be a part of this equation or we are not. And well, 

54 nuclear plants in Japan following the Fukushima issue and incident. They are going to replace about 45 coal- and natural gas-fired 

plants. That is where it is headed. 

Excuse me. 

Ms. LEOPOLD. Their coal-fired generation is at a much higher capacity factor than it used to be. 

Senator DAINES. Right. 

Ms. LEOPOLD. So they are looking to bring in more natural gas 

to be able to serve their needs. 

Senator DAINES. Right. 

Ms. LEOPOLD. And so, what I would tell you is, is the countries 

that you mentioned are the options that they have on the table realistically, along with a few others. And so, it seems not only in our 

allies’ national interest to want to look toward us, but it’s also in 

our national interest. 

Senator DAINES. Thank you. 

Mr. O’Sullivan, I was pleased that President Trump took the 

bold and much-needed action to move forward with the Keystone 

pipeline. It is a major piece of our nation’s infrastructure. It will 

create $80 million a year in tax revenues for a lot of struggling 

Eastern Montana counties. 

Our region also has other needs like approval of rights-of-way 

across federal land for gas gathering lines to help producers capture flaring gas. It seems to be a common theme from several witnesses today that there needs to be more coordination among federal agencies in the permitting process and more certainty in that 

process. 

I strongly support these efforts. They are also resulting in good 

paying family wage jobs that are currently at risk. 

My question, number one, is how does uncertainty in project 

timelines and approvals like we saw with the Keystone XL pipeline 

affect the workforce? Second question, can you expand on the importance of Keystone XL project to your members? 

Mr. O’SULLIVAN. Well, Senator, it’s critically important. 

I mean, we represent middle-class jobs. We work with companies 

that are represented at this table and across the United States in 

creating those middle-class family supporting jobs. 

The Keystone pipeline, to me, is a prime example of a permitting 

process that doesn’t work. I mean, my view, and not to be, I’m not 

being political, but when the State Department says something five 

times in five reviews, it was pretty clear to me and pretty clear to 

those that I probably represent, that until it got the way that 
103 

somebody wanted it to be, they were going to drag their feet and 

drag out the permitting process for Keystone pipeline. 

That pipeline would put about 3,900 members of my organization, just the laborers, to work. We’re one of 14 building trades 

unions, so it’s critically important to their livelihood. 

As I talk, Senator, about our ability to piece together, project by 

project, these are huge job opportunities for our members. They’re 

huge projects for our members. 

It’s not typical. My average member works on probably anywhere 

from five to seven construction projects a year. 

Senator DAINES. Right. 

Mr. O’SULLIVAN. And so, projects like this that are multi-year, 

that create opportunities for them to work for 7 months, for 12 

months, for 14 months, on one project, are—we view those as a real 

plum and a real golden opportunity for those that we represent. 

Senator DAINES. Thank you, Mr. O’Sullivan, because it is important that point is made, because sometimes the folks on the side 

of this issue will say well, these are not permanent jobs. I am the 

son of a contractor. You keep food on the table stringing together 

a bunch of temporary construction jobs. 

Thank you. 

CHAIRMAN. Thank you, Senator Daines. 

Senator Hirono? 

Senator HIRONO. Thank you, Madam Chair. 

A number of you have, as the Chair mentioned, talked about regulatory delays and that we should have concurrent regulatory review as opposed to sequential. So, is there anything in the various 

laws that apply to these agencies that prevent them from entering 

into MOUs or whatever other arrangements they can make to promote concurrent review? 

Mr. LEAHEY. I’ll take that one. 

Senator HIRONO. Mr. Leahey? 

Mr. LEAHEY. Yes, the agencies can enter into MOUs and that 

does happen on occasion. At the end of the day they are working 

under their statutory authorizations for the types of work that they 

have to do. 

We’ve also found, generally, that even direction from Washington, DC, does not always filter out into the regions. And so, the 

person who might be working on your project in Hawaii or a project 

in California or wherever may not have the same view of cooperation as what has been coming down from headquarter staff. 

Senator HIRONO. Well, what— 

Mr. LEAHEY. So, I think it’s an attitude that needs to look— 

Senator HIRONO. Yes. 

What I am getting at, are there any statutory prohibitions that 

result in subsequent or sequential review as opposed to people just 

not being on the same page at these various agencies? 

Mr. LEAHEY. In hydro, not necessarily statutory, that I’m aware 

of statutory prohibitions, but there certainly have been court cases 

and others that say the Federal Energy Regulatory Commission, 

for another, can’t force another agency to act on its timeline. That 

the agency, because of its independent authorities under another 

statute, can work under the timeline that it decides. 
104 

Senator HIRONO. Yes, but that still does not prevent them from 

entering into an MOU, such as the example of FERC and the Corps 

of Engineers coming together. 

I think, Ms. Leopold and Mr. Bird, you both also mentioned the 

regulatory process. Should we just encourage more MOUs among 

agencies so that we can have a concurrent review? 

Ms. LEOPOLD. Well I guess I would say— 

Senator HIRONO. Ms. Leopold? 

Ms. LEOPOLD. Thank you. 

I guess I would mention two aspects there. 

For the natural gas pipelines, FERC is meant to be the lead 

agency and the other federal agencies are cooperating agencies. 

And while they still have full discretion for their expertise, FERC 

is meant to work together with them to develop a schedule. 

So two things that can happen here. The first is some agencies 

may choose not to be a cooperating agency and they could go do 

their own NEPA analysis. Having better definitions around the role 

of a lead agency and the role of cooperating agencies would certainly be helpful. 

Senator HIRONO. Okay. 

Ms. LEOPOLD. The second aspect that can come into play is, I 

guess what I’d call a do loop, where one federal agency will say, 

I’m pencils down. I can’t process your permit until this agency finishes the work. And then that agency says, well, we can’t until 

some other agency. And it’s very hard to break that deadlock. So, 

any clarification on being able to have that concurrency of review. 

Senator HIRONO. I think if we can hear some very specific ways, 

as opposed to generalizations, how we can have more concurrent 

review, it would be helpful for me, at least. 

For Mr. Zindler, tomorrow the White House is expected to release its budget outline and Bloomberg News reported that DOE’s 

Office of Energy Efficiency and Renewable Energy which is currently funded at $2.1 billion a year could see its funding cut by at 

least $700 million. That is a huge part of its budget. As I observed 

to Secretary Perry during his nomination hearing, DOE has been 

a key supporter of Hawaii’s efforts to transition from importing oil 

to renewable energy, including a goal of 100 percent electric renewable energy by 2045. 

My question, Mr. Zindler, can you comment on the importance of 

public investment in clean energy technologies, like funding provided by DOE, and what the impacts would be on the pace of clean 

energy technology innovation if these programs experience major 

funding cuts? 

I am running out of time so you have to keep your answer short. 

Mr. ZINDLER. I’ll be real quick and just say that outlook in the 

short, short run we see a strong pipeline of wind and solar and 

other renewable projects that will be built over the next several 

years, frankly regardless of the budget cuts. 

In the long run, that office and other offices at DOE have played 

a very important role in thinking about the next generation of technologies and supporting the research and development that needs 

to go on. 

To be clear, if we look out 25 years our very optimistic assessment is based on the assumption that there will be technology ad-
105 

vancement going forward. And the question is whether or not the 

U.S. wants to lead in that or we want to allow some other country 

to take the lead on that. So certainly those programs have been 

vital to supporting that kind of R&D work. 

Senator HIRONO. Well, that is not exactly where this Administration is going. 

Thank you, Madam Chair. 

CHAIRMAN. Thank you, Senator Hirono. 

Senator Cassidy. 

Senator CASSIDY. Thank you. 

Mr. O’Sullivan, I am from Louisiana and there are so many 

working families that have the kind of jobs you are describing and 

they just make a good living. As you say, it is one job after another, 

but they are always steadily working. Hats off to you for your testimony and for representing the folks whom you represent. 

Ms. Leopold, wait, it took you 14 months to get a permit to do 

a survey? 

Ms. LEOPOLD. Yes, we actually completed the survey in one afternoon. It was for one-tenth of a mile. 

Senator CASSIDY. Did they give you any feedback as to why it 

took 14 months to survey one tenth of a mile? 

Ms. LEOPOLD. We met with them quite a few times. We resubmitted an application, we answered questions, and we eventually 

got our right to survey. 

Senator CASSIDY. Now I feel like there is a back story which you 

must diplomatically, because you are on national TV, so to speak, 

not convey. That is just mind-boggling that an agency would be so 

inefficient, ineffective, that something as harmless as a survey 

which is not a permission to go forward rather just a survey, would 

take 14 months. As my daughter would say, OMG. I am truly flabbergasted. 

Now Mr. Zindler, I really enjoyed your testimony, as I enjoyed 

all of your testimony. You mentioned that there has only been 1.5 

gigawatts of high voltage direct current transmission over a preceding number of years. But I know that eight years ago, when the 

Obama Administration came in, both through the stimulus package 

as well as through regulatory changes which allowed utilities to bill 

ratepayers for such lines, there was a concerted effort to put them 

in. What happened? 

Mr. ZINDLER. So actually, some of my other panelists may want 

to comment on this as well, but I guess I would argue that the 

challenges around building transmission isn’t really necessarily always related to funding and to whatever stimulus efforts or infrastructure efforts, if you want to call that now; it is related often 

to the nuts and bolts of getting permitting done across state lines. 

Senator CASSIDY. Wait, so the green initiative of the green President was thwarted by permitting? 

Mr. ZINDLER. I would say anybody on this panel would probably 

tell you that building large scale power infrastructure has issues 

regarding permitting, whether it’s green, yellow, purple, whatever 

color you want to call it. 

Senator CASSIDY. I will just say, again, now quoting Pogo, ‘‘We’ve 

met the enemy, and he is us.’’ It is incredible. 
106 

Okay. You mentioned in your testimony the need to reform electricity markets but you stopped, period, new paragraph, different 

topic. What kind of reforms do we need to the electricity market? 

Mr. ZINDLER. It’s a good question and of course, I stopped, period, 

because that’s incredibly complex and boring topic. But I could go 

on all day about it. 

But I would say this, and Mr. Imhoff identified this. As we enter 

a new era of power generation where we have sources of generation 

literally coming from people’s roofs, coming from small projects 

here and there and not producing when we want them to, necessarily. So you can’t, sort of, just send a signal and say okay, turn 

on the solar power. We need to build a market that reflects that 

and takes a look— 

Senator CASSIDY. So let me ask. 

In a sense this is a passive versus an act of right. I think I have 

that right, although I am not an attorney. So, you are generating 

solar. You have a right to sell it on to the grid, at least getting 

avoided cost. In the meantime, you are putting a nuclear power 

plant out of business. 

But you need that for base generation. Now there does seem to 

be a quandary we have developed in which you’re given a right to 

sell back to the grid but doing that disrupts the business model of 

those who’ve made billion dollar investments for carbon free energy 

that provides base load to industry. Do you follow my point? 

Mr. ZINDLER. I follow, but I don’t agree with your point. 

Senator CASSIDY. No, I’m not even sure it’s an agree or disagree. 

That is an observation. 

Mr. ZINDLER. I would say that, first of all, your point about nuclear being challenged by current market conditions is a very good 

one. And I think you’re right that we have 100 gigawatts of nuclear 

power online, by our estimate maybe a third of it is facing very 

challenging economic conditions right now in being profitable. 

The challenges that it is most often facing come from low-priced 

natural gas and the impact that that’s having on pricing which, by 

the way— 

Senator CASSIDY. I thought that stuff in Illinois was from subsidized wind coming out of Iowa. 

Mr. ZINDLER. Listen, you could—there are different people who 

will tell you different reasons. I will tell you that generally speaking we’re talking about 30 or 35 gigawatts of nuclear across the 

country and you look at the wholesale effect of lower natural gas 

prices— 

Senator CASSIDY. Let me ask though, specifically of Illinois, I am 

told that it is the subsidized rate in Iowa which actually sometimes 

pays a user to use their electricity that is—and I see this gentleman nodding his head—what is undermining what is happening 

in Illinois. 

Mr. ZINDLER. There are different—I’m not going to speak to the 

Illinois example. I think it’s certainly fair to say that there are different pressures. 

I would agree with the basic point that is if we want to think 

about a 21st century U.S. energy economy that does generate 

power in a low carbon way, I think your point is entirely well-taken 
107 

that nuclear has to be part of the picture. And I also think there 

hasn’t been an entirely rational discussion about it to date. 

Whether that means you need to go and pick on some other technology, I don’t necessarily agree with that, but I think looking at 

nuclear and how you may understand the value that it provides 

and the importance of keeping it online, I definitely would agree 

with that point. 

Senator CASSIDY. I thank you. It has been a very stimulating 

panel, thank you all. 

I yield back. 

CHAIRMAN. Thank you, Senator Cassidy. 

Senator Duckworth. 

Senator DUCKWORTH. Thank you, Chairwoman Murkowski and 

Ranking Member Cantwell, for convening this important conversation. 

As you know the Trump Administration has called for a trilliondollar infrastructure package. I am very encouraged by the bipartisan conversations we are having on the scope and breadth of this 

package, and I am very much supportive that any type of an infrastructure package includes an energy title to go with it. 

I am looking for several things when it comes to this infrastructure package, when it comes to energy. I think we need to support 

greater use of clean energy, including nuclear. Illinois has more nuclear reactors than any other state in the nation. We also need to 

have strong ‘‘buy America’’ and labor standards that support construction jobs and go further in job creation by reviving our manufacturing sector. We also need energy that is affordable. 

President O’Sullivan, I was very much encouraged by your passionate discussion of the jobs that could be created by the pipelines 

for your members. Could you speak a little bit to the Administration’s proposed new rule saying that the pipelines would not have 

to buy/use steel manufactured in America? What would it do to 

your brothers in labor and unions, such as the Steel Workers 

Union, if we rely on Chinese steel and the steel that is being illegally dumped in this country? 

Mr. O’SULLIVAN. Senator, when we had the meeting with the 

President and Keystone pipeline was brought up, I anticipated 

there was going to be a problem with that one because TransCanada had already bought the pipeline from India, actually. When 

the President mentioned buy American steel going forward, I always anticipated that the TransCanada, the Keystone pipeline, was 

going to be a potential issue but I guess that that became a reality. 

But the commitment to build pipe in the United States going forward, we are certainly encouraged about that. I mean, we love 

building the pipe manufacturing facilities and the United Steel 

Workers, our brother and sister steel workers, operate them. 

Keystone aside, pipe was already on the ground, already purchased. We anticipated that one would be pushed aside, but going 

forward we’re encouraged that we can build more pipe manufacturing facilities and that they will be built union and they will be 

operated union. 

Senator DUCKWORTH. So beyond the pipe that has already been 

purchased, and future pipe, would you support a buy America requirement for that, for example, the Dakota Access pipeline as 
108 

well, because we have steel workers who have been unemployed for 

months now, laid off, because of the illegal dumping of Asian steel 

and manufacturers here in this country? 

Mr. O’SULLIVAN. We would unequivocally support that, Senator. 

Senator DUCKWORTH. Thank you. 

Mr. Zindler, I would like to chat a little bit about the electricitygenerating states in the country. You know, Illinois is a leading net 

exporter of electricity to other states. We have extensive wind resources, but we also have nuclear. We are second in the Midwest 

in installed renewable power capacity and third in the region for 

biofuels production capacity. 

I have heard from stakeholders across my state, small town mayors and Fortune 500 companies, that in order to fully realize the 

benefits of our generating potential, we must build new transmission lines. 

Mr. Zindler, in your testimony you make similar observations 

about the need for transmission. In your view, should we be concerned that the budget cuts the Trump Administration is seeking 

from our government agencies will make it harder, not easier, to 

get the federal permitting approval that industry seeks? Even if we 

throw out every standard, don’t we need the personnel and expertise to execute these reviews? 

Mr. ZINDLER. I guess I can’t really comment, having not seen 

what this budget is going to be. I will say this, that certainly there 

are—I think under the last eight years the U.S. Department of Energy has focused more and more of its attention on next generation 

technologies and how to facilitate that, both by funding through the 

labs, but also efforts and outreach. 

So, I do think that the personnel is a critical part of this question. I think Mr. Imhoff could probably comment more about that 

at the lab level. But your point is very well taken, although, like 

I said, we really would want to see what the actual programs are 

that get cut potentially. 

Senator DUCKWORTH. Well, so if they cut the inspectors and 

there were fewer to go through to execute the review process. 

Would that make it harder? 

Mr. ZINDLER. That wouldn’t be great news. 

Senator DUCKWORTH. Okay, thank you. 

Mr. Bird, as you know our transmission system is privately 

owned, not publicly owned. What type of policies would help industry to invest in new transmission lines outside of federal permitting 

reviews? For example, would state revolving funds be useful? Are 

there investments in workforce that need to be made? 

Mr. BIRD. Again, I think as my colleague mentioned earlier, you 

know, funding is really not the primary constraint for us to expand 

our transmission infrastructure. It’s really working through the 

permitting process. That’s the key thing. 

I think I would comment that there are other transmission owners and operators that we connect to that are also important to 

manage the entire reliability of the grid and even serve our own 

customers. And so, there are entities like the Bonneville Power Administration, for example, and other public entities that might benefit from some sort of public financing opportunity that could be a 

possibility. But again, our key constraint is, frankly, really getting 
109 

through the permitting process to bring good projects, you know, 

into being. 

Senator DUCKWORTH. Well, let’s hope the hiring freeze and the 

budget cuts do not affect the folks who actually do that review. 

Thank you. I am out of time. Thank you, Chairman. 

CHAIRMAN. Thank you, Senator. 

Senator Gardner. 

Senator GARDNER. Thank you, Chairman Murkowski, for holding 

this hearing today, and thanks to the witnesses for your expertise 

and your participation in the hearing. 

I know Senator Cantwell brought this up in her opening comments. She was talking a little bit about cybersecurity concerns, 

but I, too, have read the article that was in the Houston Chronicle—the title of the article was ‘‘Opportunities to Improve American Energy Infrastructure.’’ 

It talked about, I think, a subject called ‘‘Hacked, cybersecurity 

experts easily infiltrate energy company’s networks.’’ It was a story 

about how, for just a couple hundred bucks, a security team, using 

a blanket and a couple of 16-foot ladders, were able to hike a fence, 

go into the computer network building of a power plant and basically infiltrate the network that way. That was just a way for the 

team at the plant to test its security and make sure that they were 

doing it right. 

The Senate has held 20 hearings this year in nine different committees on cybersecurity. One of the concerns that I bring to this 

Committee, to this hearing and to the industry is the cybersecurity 

risks in the energy sector. A big concern of mine is how we have 

to have infrastructure conversations that include a dialog on protecting and recovering electricity, critical infrastructure from cybersecurity threats. 

Mr. Imhoff, I will start with you. I know that the National Renewable Energy Laboratory (NREL) works with PNNL in the Grid 

Modernization Laboratory Consortium. Thank you for your work 

with the consortium, and obviously, your lab’s role in cyber resilience of the grid. 

A concern is about the process for recovery of the electricity grid 

should there be a widespread outage from a cybersecurity or 

cyberattack. Could you describe the process for conducting exercises with the industry regarding potential cyberattacks? 

Mr. IMHOFF. Happy to, Senator, and thank you for all the good 

support we get from NREL and the overall good modernization effort. 

The industry has, as driven by the NERC-set requirements, incident plans that they put in place to deal with cyber issues. They 

have conducted over the last several years four national exercises, 

called Grid X. These exercises are designed around specific scenarios of threat. 

These exercises are led by NERC, and their member utilities are 

invited to come in and participate in this artificial exercise and 

demonstrate how they would implement their incident response 

plan. 

These exercises include participation from federal officials, including the Department of Energy and other federal entities, Department of Defense and others who have infrastructure in these 
110 

locations. It also includes law enforcement and vendor community, 

et cetera. It is a very large stakeholder group, a multi-day activity, 

with very complex scenarios where they basically exercise and test 

their incident response plans, extract lessons learned and look for 

how they can improve them into the future. 

We are currently designing Grid XV. PNNL helps drive those activities. We participate as an infrastructure with substantial national security information, all within our firewalls and we are— 

we monitor and drive the activity. So, it’s a large national exercise. 

And then I would add to that conversation, Senator, that with 

the FAST Act, the authority for it rests with the Department of Energy in terms of those emergency response activities. The President 

needs to make a declaration of an event. The Secretary then needs 

to identify what the path forward is going to be. There is dialog, 

consultation with industry in that activity, and then the utilities 

would begin to implement their incident response plans accordingly. So, that’s the high level, general approach that I can share 

with you. 

Senator GARDNER. What percentage of industry has participated 

in such an exercise? 

Mr. IMHOFF. I don’t know the exact percentages. We have three 

and a half thousand utilities. I’m guessing you’re having 30 to 60 

utilities participate in those exercises. 

But the utility industry is like a wedding cake, with lots of layers. And the risk in cyber events tends to be higher in those entities that have a broader span, PacifiCorp, Pacific Power, Bonneville 

and others, the Western Coordination Council, et cetera. They’re all 

at the table and playing. You may not have a small, municipal utility from Eastern Washington participating so I think while it’s 

small in fraction in number, it’s probably a large fraction in terms 

of those strategic partners that need to be there. 

Senator GARDNER. What more ought we be doing in terms of the 

cyber structure, cybersecurity structure, that government can use 

to help utilize with industry? 

Mr. IMHOFF. Excuse me, could you repeat the question? 

Senator GARDNER. Yes, how can we work, how can the Federal 

Government better work with industry to create a more proper or 

better cybersecurity system? 

Mr. IMHOFF. So, several dimensions. 

One of the key issues is around training and workforce development. And so, what the Federal Government can bring to bear is 

advanced techniques and concepts that are developed in support 

often on the high side of the activity. We can bring those tools, 

techniques and concepts available and forward to industry. And 

that’s what’s going on in the CRISP Program today. 

The government can also bring its fundamental science in deep 

learning and advanced computation to help develop better situational and awareness tools that take advantage of the broad sensed 

information that we’re now receiving from the utilities. 

General Electric reported two weeks ago, at a House hearing, 

that only two percent of this vast digital data flow coming in off 

the grid is actually being utilized and analyzed. So, we have opportunities for better leveraging advanced computer, advanced analytic concepts, visualization, to give us a better state of awareness 
111 

in terms of what’s going on with the grid, where is the risk. And 

that’s a process where, I think, the Federal Government could deliver those tools to the private sector to enhance security. 

Senator GARDNER. Great. Thank you. 

Thank you, Madam Chair. 

CHAIRMAN. Thank you, Senator Gardner. 

Senator Cantwell. 

Senator CANTWELL. Thank you, Madam Chair. 

Following up on those same questions, Mr. Imhoff, that my colleague from Colorado asked. In our energy bill we really tried to 

focus on the workforce side since there’s a huge shortage of workforce well prepared to help us on cybersecurity. So we definitely 

want to do that and also on that supply chain that we talked about 

earlier. We want to make sure that we know where the supply 

chain is coming from, where the products are coming from. 

You talked a lot about distribution, automation and management 

control systems. When you think about Homeland Security, protecting or thinking about how to harden our targets on a critical 

side or, you know, in the old days we had a pipeline that we might 

want to protect. Now we have an entire network that is increasingly linked as our economy has become more and more wired. 

The points of contact are very diffused and coming up with this 

critical infrastructure network that we can defend against both 

various small malware attacks, you know, such as the one that 

happened in Vermont against a utility up there (people believe that 

was some sort of Russian malware) and then the state attack response where a foreign entity actually does something like what 

has happened in Ukraine. You mentioned a few of the tools that 

we need. Why do we need DOE to play more of a leadership role 

of this area? 

Mr. IMHOFF. Well, I think that the solution is very much a partnership between DOE and industry. So it’s a joint, kind of, community that needs to work together on this activity. 

There’s a lot of just fundamental blocking and tackling that 

needs to transpire. When DOE conducted the modernization four or 

five years ago, all of the investment grants required cyber protocols 

as standards put in place, a phenomenal benefit to the small and 

midsized utilities who don’t have the large engineering staffs and 

all that deal with cybersecurity. So it really raised the bar in terms 

of small and midsized utilities understanding good practice around 

cybersecurity. 

I think there remains a lot of opportunity for training and education and demonstration to raise the bar to good, basic practice of 

both around cyber operations, even around simple things like supply chain acquisition language. The small utilities that are just 

now moving into the advanced metered would be told to have the 

right language in their acquisition to reduce their vulnerability to 

the supply chain risk. 

Another big issue that I would raise, and it really fits the energy 

infrastructure question, is the very tight and increasingly tight dependence between energy and our communication networks. Ten 

years ago it was pretty easy for PacifiCorp to run their system with 

not a lot of communications. Today’s communication is very fundamental. It’s a real-time operation and situational awareness. And 
112 

as we have the explosion of the devices at the edge, we need to 

rethink how do we provide those communications and how do we 

make them secure? 

There’s, today the practice is an application brings us the communications with it. Tomorrow, we think we need to look at a different architecture, more of a layered architecture, infrastructure 

architecture, around communications that will serve multiple applications. It’s easier to secure. It’s easier to train so that it’s implemented to maintain effectively. 

So these are some of the changes we probably need to think 

about and frame. 

And here again, I think, is a very good partnership between some 

of the fundamental science knowledge coming out of the government linked with the very good work of our vendor community. 

And this just goes to the world and many others. It could bring to 

bear in terms of how do we re-architecture and provide the traffic 

capacity that we need for a more distributed, more intelligent and 

more digital energy future. 

Senator CANTWELL. So we could have a bulk attack like we have 

seen in other places? 

Mr. IMHOFF. Well, there’s a wide range of attack scenarios that 

could be applied, and we need to design systems and have the 

human training to resist those. 

The current, for instance, you mentioned the Ukraine activity. I 

was not personally involved in that diagnosis, but I do know that 

most of the NERC requirements have a defense in depth activity 

that would have been very resistant to what occurred in that case. 

There again, architecture, training, preparation, incident response 

planning, I think, are the ways that we help defend. 

Senator CANTWELL. And this is why I want DOE to make sure 

they are playing a leadership role. I want to make sure when the 

President puts out an Executive Order, he doesn’t say that that is 

for the Homeland Security Department. 

What you just described is a key responsibility that only DOE 

can carry out because you are talking about this system. To me it 

is worrisome that these attacks happen. Every time there is some 

story line in a movie or TV show about cyber, I always am constantly asking my staff for an analysis of whether that really can 

happen or not. 

I find it very interesting that most of those plots involve attacks 

against energy systems. Why do they attack the energy system? A 

disruption of our energy supply would make us so vulnerable. 

So thank you for your testimony and outlining those things. I 

think it was very clear about why we need a more aggressive role 

by DOE and all of these cyberattack issues. 

Thank you. 

CHAIRMAN. Thank you. 

Senator King. 

Senator KING. Thank you, Madam Chair. I apologize for my lateness. I was at an Armed Services Committee hearing. 

Mr. Imhoff, the grid, if Edison woke up tomorrow, would look 

pretty much the way he envisioned it and saw it developing 100, 

more than 100, years ago. Don’t we need to be thinking about the 

grid in a different way, at least in terms of the potential of distrib-
113 

uted energy, that is, generation at the factory or at the home level 

and also load management, demand management? These are 

things that can fundamentally change the grid from the model of 

big plant wires and passive receiver of the power. Is that something that you think we need to be thinking about? 

Mr. IMHOFF. Absolutely, Senator. 

You’re right. Many of the same components that Edison was familiar with are still there and they’re still, in most cases, performing very well. But we have a transition to much more distributed activity, particularly down at the distribution system level. 

And pretty soon it’s going to challenge our ability to control those 

devices. It’s going to challenge our ability to communicate with 

those devices, and oftentimes the grid reliability coordinators can’t 

actually see what’s going on at that level. Twenty years ago, it 

didn’t matter. They were, distribution and transmission, were separate worlds. 

Senator KING. But in Maine, for example, we have smart meters. 

Isn’t that part of the answer? My sense is we have the technology. 

It just isn’t utilized. 

Mr. IMHOFF. Well, so the nation has 64 million in smart meters 

this year. That’s about a 50 percent penetration. Most of the utilities I talk to have extracted much more value out of that investment than they estimated going in. So it’s delivered a lot of value 

in terms of customer choice, reliability management and other 

things. At the national level, we have 2,000 phasor measurement 

units that are networked across the U.S. We can see the system 

like never before. 

Senator KING. And that gives us the potential to do things like 

load shifting. 

Mr. IMHOFF. Yes. 

Senator KING. Load management. And we don’t have to cook our 

water at four o’clock in the afternoon. 

Mr. IMHOFF. That’s right, but we need some new approaches for 

how we control and how we communicate, interact, with these resources. 

Senator KING. Well, I would point out that one of the things people always talk about is energy costs. Everybody focuses on the energy. Again, in Maine, the cost of distribution and transmission is 

now equal and in some cases more than the cost of the energy 

itself. We need to be thinking about how to make the grid more efficient and perhaps how to avoid future infrastructure investments 

that may be unnecessary given the role of distributed resources. 

Mr. IMHOFF. Correct. 

The DOE initiative that we mentioned earlier, the Grid Modernization Initiative, has some projects looking at next generation 

tools and platforms that connect across distribution and transmission operations. So we can actually run that system closer to 

the edge, get better asset utilization. That gives, that would keep 

the delivery system more affordable and lets you exchange value 

across that membrane. 

We did conduct six workshops around the country for grid modernization—Austin, Atlanta, Minneapolis, Boston, Seattle. And we 

come—had a common feedback that increasing, there’s so much 

going on at the lower distribution level in terms of photovoltaics 
114 

and demand response and other things, that the bulk system operators reliable for reliability are now saying that they need to be 

able to see down into that system and vice versa, the distribution 

companies want to be able to see what’s going on with the bulk system. Our digital opportunities mean we need to have a better exchange of information and operate in a more unified fashion. 

Senator KING. But as you know the grid is, by definition, an inefficient animal because it is designed for the hottest day, the most 

use of the year. It’s like building a church for Christmas and 

Easter and you have a lot of empty pews the rest of the year. There 

is a lot of slack in the grid. It is that target of opportunity, it seems 

to me, that we need to be thinking about in terms of things like 

demand management. 

One more quick point before we leave. I am really worried about 

grid vulnerability to cyberattack. Ukraine was a warning shot. 

How many warning shots do we need? 

Somebody observed the other day that we are looking at the 

longest wind up for a punch in the history of the world. We know 

it is coming. And I know everybody says well, we are working on 

it and we have the architecture and everything else. 

I am just worried that we really don’t have the sense of urgency 

that, I believe, is called for in this situation. I am going to mention 

a bill that Senator Risch and I have sponsored before this Committee to have your lab examine the idea of analog, putting in some 

of the grid architecture, some old fashion analog switches because 

that is one of the things that saved them in the Ukraine, that they 

had to—they weren’t as fully digitized as we are and therefore, in 

one sense, less vulnerable. Do you have a thought on that? 

Mr. IMHOFF. So, there are several different approaches being considered. One is the use of analog systems, the other is looking at 

separate networks, and the other is looking at creating air gaps between certain networks. Some of these have been tried in various 

venues in the past. 

I acknowledge that in the case of Ukraine, it was a bit of a backstop for them that was helpful. It remains to be seen whether 

that’s the right path to go forward as a nation. If you move into 

some of those directions, you let go of some of the other benefits 

you’re getting from the digital systems. 

Senator KING. And our bill does not mandate that we move forward. It mandates that your lab and utilities, on a voluntary basis, 

study this as an option. It does not require anything. 

Madam Chair, my time has expired. I will yield, but I would like 

a second round, if possible. 

Thank you. 

CHAIRMAN. Thank you, Senator King. 

Senator Cortez Masto. 

Senator CORTEZ MASTO. Madam Chair, thank you. I also apologize for my tardiness. I am also attending the Banking Committee 

hearing, so I appreciate you being here today, appreciate the written comments ahead of time, that was very helpful. 

I just have a few questions, starting with Mr. Bird. Nevada has 

the most public lands of any state in the nation. You brought up 

a salient point in your comments, written comments, that there is 

sometimes tension between protecting public lands and expanding 
115 

access to renewable energy through expanded transmission lines. 

Do you believe that collaborative agency implementation of the 

westwide corridors has improved that issue? 

Mr. BIRD. Thank you, Senator. 

My first comment would be we’ve seen, you know, good examples 

of coordination amongst federal and state agencies. The best example of that was in our energy gateway project in the Sigurd to Red 

Butte, a 170-mile project in Utah, you know, that crossed federal 

lands. 

In that state there was very good planning and coordination up 

front by the agencies and then that was executed and that was a 

project that was then permitted on a timely basis. We were able 

to get it completed and provide the value that it needed to customers. 

I’m not as familiar with the western corridor, specific questions, 

so I’d like to follow up with that, you know, following the hearing 

today, if I could. 

Senator CORTEZ MASTO. No, I appreciate that. Again I apologize 

for being late and you may have already talked about this, but how 

do you think federal agencies can better provide schedule certainty 

to meet the permitting targets? 

Mr. BIRD. And again, thank you for the question. 

I think that is really the most important issue that we have. 

Schedule certainty is, frankly, much more important than how long 

it takes. 

I mean, I’ve described the process that took ten years with our 

Gateway West Project and what was particular to causing that 

long delay was the fact that we had to restart the permitting process all over again as soon as a new policy or guideline was issued. 

That’s what really contributed to a very long delayed project that 

would otherwise bring in tremendous amounts of new clean energy 

and relieve constraints. 

So that really is fundamental to our recommendation that, you 

know, there would be a policy enactment that would provide deadlines and accountability, single point of accountability. That’s how 

we run our business. You know, I ask a single person, that’s going 

to be responsible to deliver a project, on schedule, on budget, you 

know, if we could get more of that incorporated into how the Federal Government operates in a permitting process, that would be 

much appreciated. 

Senator CORTEZ MASTO. Thank you. 

And then Mr. Zindler, geothermal is a very important energy industry in my state, like the FORGE Geothermal Project that I recently had the opportunity to visit. They are concerned about their 

exclusion from the investment tax credit as well as the production 

tax credit. What incentives should be available to support the renewable energy sector, especially as the ITC and PTC are phased 

out? 

Mr. ZINDLER. That’s a very good question. And as you know there 

was an extension for the wind and solar industries, I believe, at the 

end of 2015, but not for some of the other technologies. 

I would, sort of, caveat this by saying that the ITC or the tax 

credits for geothermal were never a perfect fit anyway because of 

the long lead time that it takes to explore a geothermal resource 
116 

to determine whether or not it’s sufficient and then make the determination to go forward with developing a project. 

So, the long timelines associated with that process don’t necessarily fit and on again, off again schedule on the tax credits 

which is what we’d seen previously. So, that wasn’t a great fit to 

begin with, but of course, not having it at all is certainly worse. 

Senator CORTEZ MASTO. Right. 

Mr. ZINDLER. And I think that’s really where the industry is 

today. 

But geothermal, in particular though, we have seen other kinds 

of examples in other countries in other contexts where they’re trying to figure out a way to, sort of, offset the early risk associated 

with doing exploration. And that is something, I think, that is important to the specific, but very important to the geothermal industry to, sort of, oversimplify it and with geothermal the developer 

and the explorer has a lot of the risk that’s similar to exploring, 

say, for oil or gas. But the upside is not as high because you can’t 

sell what you get out of there at the same price. 

A rational way to try and support the industry that we’ve seen 

in other places is to try to help defray some of the early stage risk 

that’s associated with geothermal, and that might be something at 

least worth considering in the U.S. context. 

Senator CORTEZ MASTO. I appreciate that, thank you. And I see 

my time is almost up. 

Let me also just make a comment about cyberattack issues. In 

the State of Nevada, as Attorney General, I chaired a Technology 

Crime Board. This was one of the issues that we focused on because it is real and it is just a matter of time, and a concern of 

mine as well and something I would like to see, working with the 

industry, how we address this. 

There is no doubt in my mind. There are attacks that have already occurred, will continue to occur and we need to be very 

proactive and work together to address this issue. 

So, thank you. 

CHAIRMAN. Thank you. 

I have, probably, a wrap up comment, but I know Senator King, 

you had asked for a second round. 

Senator Cantwell, do you have another question? 

Senator CANTWELL. I wanted to get Ms. Leopold or Mr. Imhoff 

on the record about the larger benefits of pumped storage to the 

grid, if any of you have any comments about that, or Mr. Zindler. 

Mr. IMHOFF. So, pump storage fits in that category that I called 

flexibility. Back in the old days in the West when we had lots of 

excess storage capacity, they just used that pump, the hydro system, for a lot of the flexibility in the system. 

Pump storage is an awesome resource for maintaining grid reliability. I think the big challenge is just the siting issues, you know, 

the economics behind pump storage, I think, are very challenging 

today. But, as a part of a grid infrastructure for reliability, it’s a 

phenomenal resource for reliability surfaces and flexibility. 

Senator CANTWELL. Anybody else? Yes? 

Ms. LEOPOLD. I would just add that it very much can partner 

with a diverse set of energy resources, such as renewables, to be 
117 

able to use that at the times when it is available and then be able 

to use the hydro at other times. 

So, I very much echo that comment, but it really does add to a 

lot of flexibility, both for grid reliability as well as partnering for 

increased renewables. 

Mr. LEAHEY. And I would just add that there is, right now, about 

15,000 megawatts of proposed pump storage projects, different sites 

across the United States, mostly in the West. One of the reasons 

why we are seeing that is because of integration of intermittent renewables. 

Projects are now being asked to do more, and they’re responding. 

Years ago, my utility members telling me they never would have 

considered pumping during the daytime, you would always pump 

at night or on the weekends. Now in California, with as much solar 

penetration as there has been, they’re actually using some of that 

solar energy to pump during the day. 

So the grade is changing, the world is changing and pump storage, I think, has a tremendous role to play. Even though traditionally it’s been grid, large grid storage, we are now looking at smaller 

sized facilities as well. 

Senator CANTWELL. And what geographic region do you think 

can look at projects like that? 

Mr. LEAHEY. Well, you know, the proposed projects right now are 

across, I think, something like 10 or 12 states. Obviously, you have 

to have certain characteristics. You have to have the head differential between the upper and the lower reservoir. 

But again, I think, we’re looking at a variety of different projects. 

There’s even a project in Hawaii that they’re looking at as well. 

So, I think, you’re, we’re looking at traditional projects which 

were larger scale projects, but we’re also looking at some new technologies that the DOE has been looking at as well that would be 

smaller in size and scale. 

Senator CANTWELL. Well it just strikes me, as we look at battery 

storage that some very smart people are working on, there is a 

basic storage technology that is already proven here and can provide that flexibility and reliability. I definitely think we should 

focus more on what it can do for us in providing that flexibility to 

the grid. So thank you. 

Mr. LEAHEY. We would agree. 

Senator CANTWELL. Thank you, Madam Chair. 

CHAIRMAN. Thank you. 

Senator King. 

Senator KING. On the point of storage which, I think, is one of 

the key issues going forward. I became familiar with a really fascinating project in, I think it is in Nevada. 

It is called Solar Reserve where it is a solar facility with concentric rings of mirrors, a tower in the middle, but the key is that in 

that tower at the top where all the energy is concentrated, is molten salt which stays liquid at over 1,000 degrees. The salt is heated 

up. It is then pumped down into a heat exchanger and it can hold 

its heat overnight. 

So this is essentially a solar plant that is also a base load plant. 

It can deliver power 24 hours a day/seven days a week which is, 

I believe, a kind of breakthrough in the technology. Molten salt ap-
118 

parently has much better characteristics for this than water which 

vaporizes at 212 degrees. So this is very interesting, and I think 

this is a lot of work going on in batteries and in other kinds of 

things. 

The question I wanted to ask, Mr. Leahey, is that for example, 

in Maine we have something like 700 dams, very small a lot of 

them, a megawatt or so. A lot of them are facing relicensing at 

high cost. Do you have some thoughts on how we cannot lose sight 

of hydro as a clean energy source and be sure that the regulatory 

system is tailor made to the size and potential impacts of the 

projects? 

Mr. LEAHEY. That’s a great question. 

There are approximately 400 projects that are coming up for relicensing, existing projects by 2030, representing over 18,000 

megawatts of capacity. That’s a tremendous amount of capacity in 

the existing hydropower system that if you lose flexibility, if you 

lose capacity or if projects start to get surrendered because of cost 

concerns, you’re going to have to replace that clean, renewable 

power with something else. And will it be renewable or will it be 

low carbon? Who knows? 

I know Maine does have this issue. I’ve spoken with Kennebunk 

Power and Light, who have a very small project. And smaller 

projects, in particular, face, in many ways, the same licensing process that the larger projects have but they don’t have the economies 

of scale. In that sense, a lot of transactional costs get placed onto 

those projects because of the long timeline, some of the duplication 

of effort that is in that system. 

So I think, this Committee, and I commend Senator Murkowski, 

Senator Cantwell and the entire Committee on what they tried to 

do for hydro licensing last year. I think a lot of what was proposed 

in that bill would have helped projects like those in Maine. 

Senator KING. If you have any further thoughts about how this, 

and we don’t want to give up the regulatory regime all together, 

but how we can scale the requirements to the size of the project 

so that we don’t lose these resources, many of which have been in 

place for 100 years. 

It is a settled ecosystem. In fact, there would be as much or more 

environmental disruption if the dam came out than if you can 

maintain it. So to the extent that you can provide thoughts and 

suggestions, any of you, on the licensing challenges so that we can 

right size the regulations, if you will. 

Mr. LEAHEY. I would be happy to follow up with your staff and 

look at this more closely. 

And again, I think there are different types of hydropower 

projects, as I highlighted in my written testimony, from new builds 

to small conduit projects to marine energy. And I think, looking at 

those individual technology types and trying to determine what is 

the appropriate scope of review of those projects, it may not be necessary to give the same kind of scope of review that you would give 

to a large, new build project that you would be proposing, as opposed to, building on a conduit on an existing dam or something 

like that. 

Senator KING. Thank you. 

Thank you, Madam Chair. 
119 

CHAIRMAN. Mr. Koplin? 

Mr. KOPLIN. Senator King, if I could just share something actionable there. 

If you could take one representative from each of the federal and 

state agencies that are going to touch those projects and find champions in those departments that are advocates of hydro and put together a working team that they could go out in the field and be 

that economy at scale, that that’s all they work on. 

The FERC did something similar on their side, I think back in 

the 80’s or 90’s. They had a whole bunch of licenses that came due 

at the same time. They hired a contractor to handle the FERC side. 

It’s a trillion-dollar question. How do you streamline the regulatory process? I’m not sure that you can if you have bad actors out 

in the field and I’ve seen those in state agencies. I’ve seen them 

on the federal side. But if you can get the people who really have 

the agility and the desire to promote those projects and get them 

out in the field where they can still execute their responsibility to 

the environment and to the other stakeholders, I think you can 

achieve economy at scale that would be orders of magnitude, frankly. 

Senator KING. Particularly because you are developing projects 

that are, themselves, environmentally beneficial. It’s not like you 

are building something that would be necessarily damaging. We 

are talking about clean energy and renewable energy here. 

Mr. KOPLIN. Exactly, and that’s—the accountability has been 

mentioned a couple times. 

We had non-governmental organization, I think this is a good, 

little story that fiercely opposed one of our hydroelectric projects, 

but they never read a plan set when we offered them. They never 

came out in the field and looked at the project site. They advertised 

nationally and got well intended funding to oppose the project. And 

at the end of the day, three years later, we actually hired them to 

re-vegetate some of the project. Once they saw it, they were impressed and actually approached us and asked if they could partner 

on future projects. 

So, people have to—there has to be an accountability to actually 

see what’s going on and be answerable to their opposition, I guess. 

Senator KING. And let’s be clear, nobody here is advocating abandoning regulation or giving a free pass to any project. Again, it is 

a question of having the regulation meet the specifics of that situation and particularly, given the scale of the project, you do not require 10,000 pages for a home mortgage at a bank, although, I fear, 

we are heading in that direction sometimes. But it is a question of 

right sizing the regulation, I think. 

Thank you. 

Thank you, Madam Chair. 

CHAIRMAN. Thank you, Senator King. 

I know that a couple of our witnesses have to leave at 12:15, but 

I just wanted to ask Senator Cortez Masto, if you had any further— 

Senator CORTEZ MASTO. No. 

CHAIRMAN. Okay. 
120 

I want to thank our witnesses for being here today. I think there 

was great discussion, a lot, certainly, on cyber which is on everyone’s mind. 

The discussion about renewables is always important and I 

think, particularly, when we hear some of the discussion about 

where the winners and losers are with some of the policies that we 

lay down. 

We know that we have got production tax credits that are still 

out there for wind and for solar, but you mentioned the geothermal 

aspect of it. 

We also talk about hydro and the fact that because it is not designated as renewable, it misses out on some of these opportunities. 

I think it was very important, as we talk about the infrastructure, to recognize the potential for jobs and job creation. And Mr. 

O’Sullivan, I appreciate your testimony. 

Mr. O’SULLIVAN. Thank you. 

CHAIRMAN. Whether it’s how we build out pipelines, whether it’s 

how we access amazing resources like ANWR or other energy 

sources around the country, these are jobs and this is our economic 

future here, so it is good to hear. 

I will say, though, that some of what we heard today about the 

regulatory impediments to our infrastructure, we can have as many 

shovel ready projects as we can possibly line up on paper, but when 

we meet the regulatory overlay or delay or just the bureaucracy 

that, unfortunately, hits and causes that uncertainty, causes increased costs, it really does complicate so much of what we do. 

And to hear your comments, Ms. Leopold, about a 14-month process to get a permit to survey—a survey that takes basically a day. 

It just reminds us of what we are dealing with with hydro relicensing, ten years and I am told relicensing costs of tens of millions 

of dollars, $20 to $50 million, in that range for relicensing of an 

existing facility. 

We saw what happened to Shell a couple years back, seven years 

and $7 billion into a project that they walked away from. ConocoPhillips, the NPRA was looking at about seven years to permit a 

bridge, three of that for the review of the bridge, four of that for 

litigation. It causes you to wonder how we get anything done 

around here. 

I think, Mr. Koplin, you kind of summed it up when you said, 

‘‘Our little project is at the bottom of the regulatory dog pile.’’ 

Sometimes it must make you feel just like that. How do you crawl 

out from underneath it? 

I think part of our job here is to, again, we don’t want to abandon the regulations that allow for safety and good environmental 

considerations, but we want to allow for a process that is a workable process and one that is fair to the investors and fair to the 

project and fair to the workers that want to create them. 

So this has been a good discussion. I appreciate it all. 

Again, thank you all for making it through the weather to be 

here today and to contribute to the testimony. 

Senator Cantwell. 

Senator CANTWELL. I would just feel remiss if I did not say to 

Mr. O’Sullivan, three days before St. Patrick’s Day, and he’s wear-
121 

ing a green tie—we’re not going to be here on St. Patrick’s Day— 

Happy St. Patrick’s Day. 

Thank you. 

[Laughter.] 

CHAIRMAN. We stand adjourned. 

[Whereupon, at 12:13 p.m. the hearing was adjourned.] 
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