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28–115 PDF 2018

THE 2017 HURRICANE SEASON: A REVIEW OF 

EMERGENCY RESPONSE AND ENERGY INFRASTRUCTURE RECOVERY EFFORTS 

HEARING 

BEFORE THE

SUBCOMMITTEE ON ENERGY 

OF THE

COMMITTEE ON ENERGY AND 

COMMERCE 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED FIFTEENTH CONGRESS 

FIRST SESSION 

NOVEMBER 2, 2017 

Serial No. 115–72 

( 

Printed for the use of the Committee on Energy and Commerce 

energycommerce.house.gov 

COMMITTEE ON ENERGY AND COMMERCE 

GREG WALDEN, Oregon 

Chairman 

JOE BARTON, Texas 

Vice Chairman 

FRED UPTON, Michigan 

JOHN SHIMKUS, Illinois 

MICHAEL C. BURGESS, Texas 

MARSHA BLACKBURN, Tennessee 

STEVE SCALISE, Louisiana 

ROBERT E. LATTA, Ohio 

CATHY MCMORRIS RODGERS, Washington 

GREGG HARPER, Mississippi 

LEONARD LANCE, New Jersey 

BRETT GUTHRIE, Kentucky 

PETE OLSON, Texas 

DAVID B. MCKINLEY, West Virginia 

ADAM KINZINGER, Illinois 

H. MORGAN GRIFFITH, Virginia 

GUS M. BILIRAKIS, Florida 

BILL JOHNSON, Ohio 

BILLY LONG, Missouri 

LARRY BUCSHON, Indiana 

BILL FLORES, Texas 

SUSAN W. BROOKS, Indiana 

MARKWAYNE MULLIN, Oklahoma 

RICHARD HUDSON, North Carolina 

CHRIS COLLINS, New York 

KEVIN CRAMER, North Dakota 

TIM WALBERG, Michigan 

MIMI WALTERS, California 

RYAN A. COSTELLO, Pennsylvania 

EARL L. ‘‘BUDDY’’ CARTER, Georgia 

JEFF DUNCAN, South Carolina 

FRANK PALLONE, JR., New Jersey 

Ranking Member 

BOBBY L. RUSH, Illinois 

ANNA G. ESHOO, California 

ELIOT L. ENGEL, New York 

GENE GREEN, Texas 

DIANA DEGETTE, Colorado 

MICHAEL F. DOYLE, Pennsylvania 

JANICE D. SCHAKOWSKY, Illinois 

G.K. BUTTERFIELD, North Carolina 

DORIS O. MATSUI, California 

KATHY CASTOR, Florida 

JOHN P. SARBANES, Maryland 

JERRY MCNERNEY, California 

PETER WELCH, Vermont 

BEN RAY LUJA ́ N, New Mexico 

PAUL TONKO, New York 

YVETTE D. CLARKE, New York 

DAVID LOEBSACK, Iowa 

KURT SCHRADER, Oregon 

JOSEPH P. KENNEDY, III, Massachusetts 

TONY CA ́ RDENAS, California 

RAUL RUIZ, California 

SCOTT H. PETERS, California 

DEBBIE DINGELL, Michigan 

SUBCOMMITTEE ON ENERGY

FRED UPTON, Michigan 

Chairman 

PETE OLSON, Texas 

Vice Chairman 

JOE BARTON, Texas 

JOHN SHIMKUS, Illinois 

ROBERT E. LATTA, Ohio 

GREGG HARPER, Mississippi 

DAVID B. MCKINLEY, West Virginia 

ADAM KINZINGER, Illinois 

H. MORGAN GRIFFITH, Virginia 

BILL JOHNSON, Ohio 

BILLY LONG, Missouri 

LARRY BUCSHON, Indiana 

BILL FLORES, Texas 

MARKWAYNE MULLIN, Oklahoma 

RICHARD HUDSON, North Carolina 

KEVIN CRAMER, North Dakota 

TIM WALBERG, Michigan 

GREG WALDEN, Oregon (ex officio) 

BOBBY L. RUSH, Illinois 

Ranking Member 

JERRY MCNERNEY, California 

SCOTT H. PETERS, California 

GENE GREEN, Texas 

MICHAEL F. DOYLE, Pennsylvania 

KATHY CASTOR, Florida 

JOHN P. SARBANES, Maryland 

PETER WELCH, Vermont 

PAUL TONKO, New York 

DAVID LOEBSACK, Iowa 

KURT SCHRADER, Oregon 

JOSEPH P. KENNEDY, III, Massachusetts 

G.K. BUTTERFIELD, North Carolina 

FRANK PALLONE, JR., New Jersey (ex 

officio) 

(II) 

(III) 

C O N T E N T S 

Page 

Hon. Fred Upton, a Representative in Congress from the State of Michigan, 

opening statement ................................................................................................ 2 

Prepared statement .......................................................................................... 3 

Hon. Bobby L. Rush, a Representative in Congress from the State of Illinois, 

opening statement ................................................................................................ 4 

Hon. Greg Walden, a Representative in Congress from the State of Oregon, 

opening statement ................................................................................................ 5 

Prepared statement .......................................................................................... 6 

Hon. Frank Pallone, Jr., a Representative in Congress from the State of 

New Jersey, opening statement .......................................................................... 8 

Prepared statement .......................................................................................... 9 

WITNESSES

Patricia Hoffman, Principal Assistant Secretary, Office of Electricity Delivery 

and Energy Reliability, Department of Energy ................................................. 10 

Prepared statement .......................................................................................... 13 

Answers to submitted questions ...................................................................... 233 

Ray Alexander, Director of Contingency Operations, Army Corps of Engineers ...................................................................................................................... 17 

Prepared statement .......................................................................................... 19 

Answers to submitted questions ...................................................................... 244 

DeAnn T. Walker, Chairman, Public Utility Commission of Texas .................... 23 

Prepared statement .......................................................................................... 25 

Robert F. Corbin, Deputy Assistant Secretary, Office of Petroleum Reserves, 

Department of Energy ......................................................................................... 37 

Prepared statement .......................................................................................... 39 

Answers to submitted questions ...................................................................... 251 

Frank Rusco, Director, Natural Resources and Environment, Government 

Accountability Office ............................................................................................ 45 

Prepared statement .......................................................................................... 47 

Thomas A. Fanning, President and Chief Executive Officer, Southern Company, on Behalf of the Electricity Subsector Coordinating Council ................. 101 

Prepared statement .......................................................................................... 103 

Answers to submitted questions ...................................................................... 255 

Julio A. Rhymer, Sr., Executive Director and Chief Executive Officer, Virgin 

Islands Water & Power Authority ...................................................................... 114 

Prepared statement .......................................................................................... 116 

Chet Thompson, President and Chief Executive Officer, American Fuel & 

Petrochemical Manufacturers ............................................................................. 125 

Prepared statement .......................................................................................... 127 

Max E. McBrayer, Jr., Chief Supply Officer and Chief Financial Officer, 

RaceTrac Petroleum, Inc., on Behalf of the National Association of Convenience Stores and the Society of Independent Gasoline Marketers of America 144 

Prepared statement .......................................................................................... 146 

Ramon-Luis Nieves, Attorney at Law, Former Member, Senate of Puerto 

Rico ........................................................................................................................ 155 

Prepared statement .......................................................................................... 157 

Catherine B. Kennedy, Vice President, National Nurses United ........................ 170 

Prepared statement .......................................................................................... 172 

Page

IV 

SUBMITTED MATERIAL

Letter of November 3, 2017, from Eugene Dacus, Director, Office of Congressional Affairs, Nuclear Regulatory Commission, to Mr. Upton, submitted 

by Mr. Olson 1

Letter of October 31, 2017, from Ricardo L. Ramos Rodriguez, Chief Executive 

Officer, Puerto Rico Electric Power Authority, to American Public Power 

Association and Edison Electric Institute, submitted by Mr. Olson ................ 213 

Letter of November 1, 2017, from Susan N. Kelly, President and Chief Executive Officer, American Public Power Association, to Mr. Upton and Mr. 

Rush, submitted by Mr. Olson ............................................................................ 215 

Letter of October 31, 2017, from Sue Kelly, President and Chief Executive 

Officer, American Public Power Association, and Tom Kuhn, President, 

Edison Electric Institute, to Ricardo L. Ramos Rodriguez, Chief Executive 

Officer, Puerto Rico Electric Power Authority, submitted by Mr. Olson ......... 219 

Letter of November 1, 2017, from Stephen J. Ubl, President and Chief Executive Officer, PhRMA, to Mr. Upton and Mr. Rush, submitted by Mr. Olson .. 220 

Statement of Energy Information Administration, Department of Energy, by 

John J. Conti, Acting Administrator, with supplemental material, November 2, 2017, submitted by Mr. Olson 2

Letter of November 2, 2017, from Scott Whitaker, President and Chief Executive Officer, AdvaMed, to Mr. Upton and Mr. Rush, submitted by Mr. 

Olson ..................................................................................................................... 223 

Letter of November 2, 2017, from Scott Gottlieb, Commissioner of Food and 

Drugs, Food and Drug Administration, to Committee and Subcommittee 

Leadership, submitted by Mr. Olson .................................................................. 224 

Statement of the GridWise Alliance, November 2, 2017, submitted by Mr. 

Olson ..................................................................................................................... 226 

Letter of October 31, 2017, from Judith Enck, Former EPA Region 2 Regional 

Administrator, and Ramon Cruz, Former Commissioner, Puerto Rico Energy Commission, to Hon. Lisa Murkowski, Chair, and Hon. Maria Cantwell, Ranking Member, Senate Committee on Energy and Natural Resources, submitted by Mr. Olson ........................................................................ 230 

1The information has been retained in committee files and also is available 

at http://docs.house.gov/meetings/IF/IF03/20171102/106573/HHRG-115- 

IF03-20171102-SD010.pdf. 2The information has been retained in committee files and also is available 

at http://docs.house.gov/meetings/IF/IF03/20171102/106573/HHRG-115- 

IF03-20171102-SD003.pdf. 

(1) 

THE 2017 HURRICANE SEASON: A REVIEW OF 

EMERGENCY RESPONSE AND ENERGY INFRASTRUCTURE RECOVERY EFFORTS 

THURSDAY, NOVEMBER 2, 2017 

HOUSE OF REPRESENTATIVES, 

SUBCOMMITTEE ON ENERGY, 

COMMITTEE ON ENERGY AND COMMERCE, 

Washington, DC. 

The subcommittee met, pursuant to call, at 10:34 a.m., in room 

2123, Rayburn House Office Building, Hon. Fred Upton (chairman 

of the subcommittee) presiding. 

Members present: Representatives Upton, Olson, Shimkus, 

Latta, Harper, McKinley, Kinzinger, Griffith, Johnson, Long, 

Bucshon, Flores, Mullin, Hudson, Walberg, Walden (ex officio), 

Rush, McNerney, Green, Doyle, Castor, Sarbanes, Welch, Tonko, 

Loebsack, Schrader, Kennedy, Butterfield, and Pallone (ex officio). 

Also present: Representative Bilirakis. 

Staff present: Ray Baum, Staff Director; Mike Bloomquist, Deputy Staff Director; Adam Buckalew, Professional Staff Member, 

Health; Allie Bury, Legislative Clerk, Energy/Environment; Karen 

Christian, General Counsel; Kelly Collins, Staff Assistant; Zack 

Dareshori, Staff Assistant; Wyatt Ellertson, Professional Staff 

Member, Energy and Environment; Adam Fromm, Director of Outreach and Coalitions; Jordan Haverly, Policy Coordinator, Environment; A.T. Johnston, Senior Policy Advisor, Energy; Mary Martin, 

Chief Counsel, Energy and Environment; Alex Miller, Video Production Aide and Press Assistant; Brandon Mooney, Deputy Chief 

Counsel, Energy; Mark Ratner, Policy Coordinator; Annelise 

Rickert, Counsel, Energy; Dan Schneider, Press Secretary; Peter 

Spencer, Senior Professional Staff Member, Energy; Jason Stanek, 

Senior Counsel, Energy; Madeline Vey, Policy Coordinator, Digital 

Commerce and Consumer Protection; Hamlin Wade, Special Advisor for External Affairs; Everett Winnick, Director of Information 

Technology; Andrew Zach, Senior Professional Staff Member, Environment; Priscilla Barbour, Minority Energy Fellow; Jeff Carroll, 

Minority Staff Director; Rick Kessler, Minority Senior Advisor and 

Staff Director, Energy and Environment; John Marshall, Minority 

Policy Coordinator; Jon Monger, Minority Counsel; Alexander 

Ratner, Minority Policy Analyst; Tim Robinson, Minority Chief 

Counsel; Tuley Wright, Minority Energy and Environment Policy 

Advisor; C.J. Young, Minority Press Secretary; and Catherine Zander, Minority Environment Fellow. 

2 

Mr. UPTON. The Subcommittee on Energy will now come to 

order. 

And the Chair will recognize himself for an opening statement. 

OPENING STATEMENT OF HON. FRED UPTON, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF MICHIGAN 

So, this year’s Atlantic hurricane season was unprecedented. 

Four named storms in close succession slammed into the Gulf, 

Puerto Rico, and the U.S. Virgin Islands. These hurricanes caused 

catastrophic damage and energy supply disruptions across the 

country. While Texas and Florida are further down the road to recovery, a humanitarian crisis is unfolding in Puerto Rico—a number of colleagues from this committee have been down there—and 

the U.S. Virgin Islands, where the majority of folks still remain 

without power for more than a month after Hurricane Maria made 

landfall. 

Today’s hearing will review the emergency response and energy 

recovery efforts in the wake of those storms. It will help us begin 

to understand what went right and what went wrong, what lessons 

can be learned, and how we, as policymakers, can identify gaps, so 

that when the next hurricane hits, we will be better prepared. 

As a result of Hurricane Harvey, more than 275,000 customers 

lost power in Texas, and severe flooding also affected the supply 

and delivery of transportation fuels, compounding response challenges and energy impacts across the Gulf. Hurricane Irma left 

more than a million customers without power across Puerto Rico 

and the Virgin Islands. More than 6 million customers in Florida 

and another million in Georgia and South Carolina also lost power. 

Then, two weeks after Irma, Hurricane Maria delivered the knockout punch, wiping out the entire grid on Puerto Rico and the Virgin 

Islands. At peak, more than 31⁄2 million folks were without power. 

As with most disasters, energy restoration is performed by Federal, State, and local authorities, who provide vital resources, infrastructure support, and logistical coordination, and by industry, 

which provides the expertise and manpower to restore energy supply and services. 

As we have witnessed nightly in the news, recovery on the islands has been painfully difficult and slow. Questions are mounting 

regarding the role of the Puerto Rico Electric Power Authority, 

PREPA, and its initial reluctance to request mutual aid from mainland electricity companies that were standing by ready to assist immediately after the storm. Rather than request mutual assistance, 

as Texas and Florida did in the preceding storms, PREPA took the 

unusual step to award a contract to a virtually unknown company 

which it then canceled. The deals that PREPA signed immediately 

following the storm are now the subject of an investigation by this 

committee, as they should be. 

Today we are going to hear from two witness panels which will 

provide perspective from the Federal level, the State level, and the 

industry responder level. As we have seen in recent weeks across 

the areas affected by the storms, each disaster creates its own set 

of problems. Today’s witnesses can help us understand the factors 

that contribute to these problems and what we may do to ensure 

a more effective response going forward. 

3 

It will also help us understand the challenges that they face as 

they move energy and product in the aftermath of devastating 

storms. While we have seen alarming devastation, we have also 

seen some aspects of the response go right. At this point, by most 

accounts, the Department of Energy’s support functions have gone 

well. DOE’s coordination of regulatory assistance, or waivers, during the disasters has gone well. Their informational assistance has 

been consistent and helpful to Government and industry alike. 

We will hear this morning about the Strategic Petroleum Reserve, which during Harvey served to provide emergency petroleum 

swaps to make up for the temporary loss of supply and keep prices 

at the pump somewhat stable. 

We will also receive an important update on the various restoration efforts to bring power back to the folks of Puerto Rico and the 

Virgin Islands. It will be particularly helpful to understand what 

have been the barriers to a more rapid recovery, what we are 

learning about coordination of emergency response and restoration 

on these Territories, and what is needed more from us, the Congress. How can we apply these lessons going forward? This hearing 

should help us answer some of those critical questions. 

[The prepared statement of Mr. Upton follows:] 

PREPARED STATEMENT OF HON. FRED UPTON

This year’s Atlantic hurricane season was unprecedented—four named storms in 

close succession slammed into the Gulf Coast, Puerto Rico and the U.S. Virgin Islands. These hurricanes caused catastrophic damage and energy supply disruptions 

across the Nation. While Texas and Florida are further down the road to recovery, 

a humanitarian crisis is unfolding in Puerto Rico and the U.S. Virgin Islands, where 

the majority of people still remain without power more than a month after Hurricane Maria made landfall. 

Today’s hearing will review the emergency response and energy recovery efforts 

in the wake of these storms. It will help us begin to understand what went right 

and what went wrong. What lessons can be learned, and how we as policy makers 

can identify gaps, so that when the next hurricane hits, we are better prepared. 

As a result of Hurricane Harvey, more than 275,000 customers lost power in 

Texas, and severe flooding also affected the supply and delivery of transportation 

fuels-compounding response challenges and energy impacts across the Gulf Coast. 

Hurricane Irma, left more than 1 million customers without power across Puerto 

Rico and the Virgin Islands. More than 6 million customers in Florida and another 

1 million in Georgia and South Carolina also lost power. Then, just two weeks after 

Irma, Hurricane Maria delivered the knockout punch, wiping out the entire grid on 

Puerto Rico and the Virgin Islands. At peak, more than 3.5 million people were 

without power. 

As with most disasters, energy restoration is performed by Federal, State, and 

local authorities, who provide vital resources, infrastructure support, and logistical 

coordination, and by industry, which provides the expertise and manpower to restore energy supplies and services. 

As we’ve witnessed nightly in the news, recovery on the islands has been painfully 

difficult and slow. Questions are mounting regarding the role of the Puerto Rico 

Electric Power Authority (PREPA) and its initial reluctance to request ‘‘mutual aid’’ 

from mainland electricity companies that were standing-by ready to assist immediately after the storm. Rather than request mutual assistance as Texas and Florida 

did in the preceding storms, PREPA took the unusual step to award a contract to 

a virtually unknown company which it then canceled. The deals that PREPA signed 

immediately following the storm are now the subject of an investigation by this committee. 

Today, we will hear from two witness panels, which will provide perspective from 

the Federal level, the State level, and the industry responder level. As we’ve seen 

in recent weeks across the areas affected by the storms, each disaster creates its 

own set of problems. Today’s witnesses can help us understand the factors that contribute to these problems and what we may do to ensure a more effective response 

4 

going forward. They will also help us understand the challenges they face as they 

move energy and product in the aftermath of devastating storms. While we’ve seen 

alarming devastation, we have seen some aspects of the response go right. To this 

point, by most accounts, Department of Energy support functions have gone well. 

DOE’s coordination of regulatory assistance (or ‘‘waivers’’) during the disasters has 

gone well. Their informational assistance has been consistent and helpful to Government and industry alike. 

We’ll hear this morning about the Strategic Petroleum Reserve, which during 

Harvey served to provide emergency petroleum swaps to make up for the temporary 

loss of supply. We’ll also receive an important update on the various restoration efforts to bring power back to the people of Puerto Rico and the Virgin Islands. It 

will be particularly helpful to understand what have been the barriers to a more 

rapid recovery. What are we learning about coordination of emergency response and 

restoration on these Territories? What more is needed from Congress? How can we 

apply these lessons going forward? 

This hearing should help us begin to answer these critical questions. 

Mr. UPTON. And I yield now to the ranking member of the subcommittee, my friend, the gentleman from Illinois, Mr. Rush. 

OPENING STATEMENT OF HON. BOBBY L. RUSH, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF ILLINOIS 

Mr. RUSH. I want to thank you, Mr. Chairman, for holding this 

important hearing, examining the 2017 hurricane season and the 

emergency response and energy infrastructure recovery efforts surrounding these emergencies. 

Mr. Chairman, I hope this will not be a ‘‘one and done’’ hearing. 

Folks know in this year’s historic and devastating hurricane season 

that there are many, many critical interrelated issues that must be 

addressed. 

While I appreciate having witnesses here to discuss the GAO report that we requested last year, the fact of the matter, Mr. Chairman, is that, as we speak, there are still many millions of American citizens living without electricity, and many are facing dire 

life-and-death conditions. It is over a month now that Hurricanes 

Harvey and Irma and Maria shattered their lives and devastated 

their livelihoods. 

Mr. Chairman, it is my hope that this hearing will shed light on 

what additional steps need to be taken quickly to restore power 

while also assuring those residents in Puerto Rico and the U.S. Virgin Islands specifically that their Government has not forgotten 

about them and that we will provide the exact same effort and the 

exact same attention to helping them as we would for any other 

American citizen. 

Mr. Chairman, as you know, more than six weeks after Hurricane Maria initially made landfall, nearly 70 percent of Puerto Rico 

and 80 percent of the U.S. Virgin Islands still, Mr. Chairman, still 

lack the power needed for basic everyday services, such as lighting 

their homes, treating drinking water, preserving food and medicine, or even making emergency calls, among other critical functions that are so necessary to normal and daily activities. 

While immediate attention must be focused, Mr. Chairman, on 

providing essential resources to protect the safety of individuals 

and help them cope in maintaining their lives, over the long term 

we must also help to rebuild the energy infrastructure in a way 

that makes it stronger and more resilient against extreme weather 

conditions. 

5 

Mr. Chairman, Hurricanes Irma and Maria exposed the vulnerability of the Puerto Rico and U.S. Virgin Islands electric grids to 

extreme weather, while some communities expected to remain 

without power for even months on end. In fact, a study released 

last week by the Rhodium Group concluded that the outages 

caused by Hurricane Maria resulted in 1.25 billion hours of electricity-supply disruption to households in Puerto Rico and the U.S. 

Virgin Islands, Mr. Chairman, making this sole event the Nation’s 

largest blackout that was ever recorded. ‘‘We can find no event in 

recorded U.S. history where there were as many people without 

power for as long as has occurred over the past month in Puerto 

Rico and the U.S. Virgin Islands,’’ the report stated. 

Mr. Chairman, I look forward to engaging today’s distinguished 

panel on the progress that has been made, the additional steps that 

must be taken to immediately get the power back on, as well as 

the ways that we build more resilient and sustainable infrastructure that is less vulnerable to an extreme weather condition that 

we have witnessed and that we certainly will witness in the future. 

Thank you, Mr. Chairman. I yield back the balance of my time. 

Mr. OLSON [presiding]. The gentleman yields back. 

The Chair now calls upon the chairman of the full committee, 

Mr. Walden, for 5 minutes. 

OPENING STATEMENT OF HON. GREG WALDEN, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF OREGON 

Mr. WALDEN. I thank the gentleman and acknowledge his uniform today. 

The 2017 hurricane season has been among the worst in recent 

memory. Four major storms have wreaked havoc all over our Gulf 

Coast and, more recently, in Puerto Rico and the Virgin Islands. 

While fuel supplies and electricity have been restored on the mainland, a humanitarian crisis continues to unfold in Puerto Rico and 

the U.S. Virgin Islands, and I think you hear that from both sides 

of the aisle here. This is a real, real serious situation we all care 

deeply about. 

As we often do following natural disasters, it is not uncommon 

to see stories in the news about heroics and acts of personal sacrifice and great kindness. We trust that our policymakers can put 

aside their differences to do what is in the best interest of the 

country. We have already passed initial supplemental disaster relief funding this Congress, but we understand that much more is 

needed, and we will continue to work with the administration and 

our colleagues, so that our fellow citizens can get the additional resources they need to recover and to rebuild. 

In this committee we roll up our sleeves and we search for solutions to the various challenges that present themselves after a 

major disaster. We want to make sure that the agencies under our 

jurisdiction are well-prepared and that you all are responding appropriately, both now and that we learn from lessons of bad incidents and are ready and even better prepared for the next storm 

or the next disaster. 

If you are lacking certain authorities, let us know. We would like 

to expedite recovery. We want to know about these things, so that 

we can help fix them. We are all in this together. 

6 

We want to be practical and we want to be forward-thinking. 

How can we help ensure the relevant Federal response is well-coordinated with State, local, and industry responders? How do we 

ensure decisions are made to guarantee taxpayer funding provides 

the maximum benefit for those in need and that taxpayers aren’t 

ripped off? If we need to rebuild, what can we do to make our infrastructure more resilient? 

Because of this committee’s broad jurisdiction over public health, 

emergency telecommunications, and the supply and delivery of energy, we will be gathering facts, perspectives, and lessons learned. 

We have already heard from witnesses on our Oversight and Investigations Subcommittee hearing about HHS’s public health preparedness for and responses to the hurricanes. We will soon examine the disaster response related to environmental hazards and 

telecommunications as well. 

But today we are focusing on emergency response and energy infrastructure recovery, both for fuel supply and the electric grid. 

This year we have already been confronted with several different 

challenging situations: historic flooding in Houston, possibly the 

greatest evacuation in Florida’s history, an energy crisis in Puerto 

Rico and the U.S. Virgin Islands that could leave millions without 

power for estimated months to come. 

We may take for granted how lucky we are that we can flip a 

switch and the lights come on. For our citizens in Puerto Rico and 

the U.S. Virgin Islands, however, almost every aspect of their lives 

has been deeply disrupted. Hospitals without external generators 

cannot serve their patients. Getting that power restored is critical. 

Water treatment plants without power threaten the health of individuals that rely on them for safe water. And those who live in remote areas that do not have access to fuel are cut off even from 

the most basic of necessities. 

The witness panel today will provide important perspectives 

about the state of current fuel and electric supply recovery efforts, 

what worked, what could be done better under urgent circumstances of the hurricanes, and what may be considered in the 

future. I expect this will be an excellent hearing for us to identify 

vulnerabilities and assess what is needed to better prepare and respond to future storms and disasters. 

And with that, I want to thank you for being here today. I appreciate the testimony which you have already submitted that I have, 

and thanks for the good work you and your teams are doing out 

there. We really want to learn from you and be even better prepared when the next disaster hits. 

So, with that, Mr. Chairman, unless anybody else on our side 

seeks the remaining minute, I would yield back. 

[The prepared statement of Mr. Walden follows:] 

PREPARED STATEMENT OF HON. GREG WALDEN

Let me welcome Secretary Perry to his first appearance before the Energy and 

Commerce Committee. I understand that yesterday DOE held a ceremony to celebrate its 40 years as a cabinet agency. A lot has changed in this country and in 

the world since Congress created the department—especially in the national security and energy security space, where DOE provides critical functions for the country. 

7 

While the domestic and international energy posture is substantially different 

from what it was in the 1970s, I do not believe the importance of DOE’s role serving 

the national and public interest has diminished. 

This past August, Secretary Perry joined me at an energy roundtable with local 

officials and energy leaders at the McNary Dam, on the Columbia River in Umatilla 

County, Oregon, which produces power for the Bonneville Power Administration. Of 

course, Secretary Perry could not leave Umatilla County without a famous 

Hermiston watermelon—the best in the world. I believe Secretary Perry also left 

with a greater appreciation of the tremendous, zero-carbon-emitting power resource 

we have that’s helping grow the economy in Oregon and throughout the Northwest. 

The next day, I had the pleasure of accompanying Secretary Perry to DOE’s Pacific Northwest National Laboratory and then to the Hanford Site, just up the Columbia River from my Oregon district. 

A couple of observations from that visit are pertinent for today: First, it was evident that abundant energy was critical to the historical success of Hanford’s industrial operations, which built nuclear reactors and produced the plutonium vital to 

winning World War II and later maintaining the Nation’s nuclear deterrent program. 

Second, Hanford’s success, and subsequent cleanup operations, led to advances in 

engineering practices, research and development programs, and scientific activities 

necessary for the site’s safe and secure operations. These advances led to the development of a world-class national laboratory. Today, the Pacific Northwest National 

Laboratory, in collaboration and partnership with DOE’s 16 other national laboratories, provide scientific and technical breakthroughs to meet our national security 

and energy security needs-from securing our electric grid to advancing storage technologies. 

As we examine the DOE management and mission priorities today, we should 

keep in mind the benefits of the interconnected nature of the department’s missions. 

But these missions across DOE’s enterprise can be expensive and difficult to manage. And so, it is the responsibility of the secretary and the Congress to ensure the 

department is appropriately aligned to perform these missions in a cost-effective 

manner, and to the maximum benefit of the taxpayer. 

As Chairman Upton has indicated, the energy threats today are not the same as 

the threats of the 1970s, but they remain significant. This committee will work in 

the coming months and through this Congress to ensure the department’s organization and missions are aligned with the energy security challenges of today. 

At my direction, Vice Chairman Barton has already started to facilitate, in coordination with the Energy Subcommittee, work to ensure DOE resources are focused 

on the core missions of nuclear and energy security, environmental remediation, and 

mission-enabling science and R&D programs. At the same time, the committee will 

be examining expired DOE authorizations-many of which expired over a decade ago, 

to ensure more fully appropriate program alignment. 

I look forward to your testimony, Secretary Perry, it will be helpful to both these 

efforts. I’d also like for you to address the recent questions that have arisen regarding your travel expenditures. In closing, I look forward to working closely with DOE 

and my colleagues as we ensure the agency is positioned appropriately for the energy security challenges that lie ahead. 

Mr. UPTON [presiding]. I just might ask a question of the vice 

chair of the committee. Are you intending to wear that jersey on 

the House floor when we take the picture of the full House this 

afternoon? 

Mr. OLSON. Mr. Chairman, that is not an issue. I tried to wear 

this about three weeks, and it was banned. So, this will not be in 

the picture—— 

Mr. UPTON. All right. 

Mr. OLSON [continuing]. Much to your disappointment, I can tell. 

Mr. UPTON. I just was curious because, then, we would always 

be able to find you forever, right, in that picture? 

[Laughter.] 

Mr. WALDEN. Now, Mr. Chairman, I yield back the balance of my 

time. 

Mr. UPTON. Yes, the gentleman yields back. 

8 

I recognize the ranking member of the full committee, Mr. Pallone from New Jersey, for an opening statement. 

OPENING STATEMENT OF HON. FRANK PALLONE, JR., A REPRESENTATIVE IN CONGRESS FROM THE STATE OF NEW JERSEY 

Mr. PALLONE. Thank you, Mr. Chairman, for convening today’s 

hearing reviewing the disastrous 2017 hurricane season, which has 

wreaked havoc on many parts of our country. 

And I am grateful to former Senator Nieves of Puerto Rico and 

Mr. Rhymer of the Virgin Islands for coming here today. I guess 

they are on the second panel. 

But I am disappointed that the committee did not even receive 

a response to its outreach to the Puerto Rico Electric Power Authority, or PREPA. I have serious concerns not only about how 

PREPA has overseen the effort to restore power in Puerto Rico, but 

also, more broadly, on how PREPA has managed or, more accurately, mismanaged the grid in Puerto Rico over the years. 

Now, today we are focusing on the energy infrastructure recovery 

efforts. I must say that accounts from the areas affected by these 

storms paint a dire situation that completely contradicts the often 

rosy stories that come from the White House. The truth is that, 

taken together, Puerto Rico and the Virgin Islands are currently 

experiencing the largest blackout in American history, and this 

nightmare for our fellow citizens is far from over. 

The central question for us today should be, why is it taking so 

long to restore power in Puerto Rico and the Virgin Islands, and 

who is actually in charge of the effort to restore power to Puerto 

Rico? No one person or entity seems to be in charge, and it is fostering a chaotic and ineffective effort to restore power on the island. And I want answers, and so do many of my colleagues on 

both sides of the aisle. 

I am also troubled by the maze of contracts with numerous companies for overlapping missions, a patchwork that is failing to turn 

the lights back on in Puerto Rico. And that needs to change now. 

I am deeply concerned by the terms of the contract PREPA signed 

with Whitefish and Cobra Acquisitions, which went so far as to bar 

PREPA from holding the companies liable for delayed completion 

of grid repair work or letting the Government audit their work. 

Now, Governor Rossello has since taken steps to have the Whitefish contract canceled, but we need to learn more about how these 

contracts are being awarded and whether the bidding process is 

truly competitive. That is why Chairmen Walden and Upton and 

Ranking Members Rush, DeGette, and I have requested documents 

and a briefing from Whitefish, so we can learn more about how 

that troubling agreement materialized. 

Additionally, FEMA issued a statement that said it had no involvement in the development of this contract. Well, my question 

is, why not? The Federal Government should be engaged in the 

contracting process of large-scale rebuilding contracts for which 

U.S. taxpayers will ultimately foot the bill. The Federal Government needs to step up and take charge to expedite power restoration efforts. Missions like this are why we have a strong Federal 

Government. And simply put, the Trump administration needs to 

9 

be doing more. If we can’t get the power turned back on soon, more 

people are going to die. This is a humanitarian crisis, and our Government owes it to the citizens in these Territories to do everything 

it can to fix it. 

And while restoring power quickly is the most urgent concern, it 

is also crucial that the grid in Puerto Rico and the U.S. Virgin Islands be rebuilt with more modern energy technology focused on 

increased resiliency, energy efficiency, and renewable energy. Replacing the old grid as it stood before the storm will cost taxpayers 

more money and do nothing to make electricity in Puerto Rico more 

reliable or affordable. 

So, as Congress prepares the next emergency spending bill, we 

must make changes to the current law to enable the rebuilding to 

occur in a way that lays the groundwork for constructing a modern 

electricity grid in the Territories. Failing to invest wisely in Puerto 

Rico now will only cost all taxpayers more down the road. And we 

must consider innovative ways for turning around Puerto Rico’s situation, including alternatives to PREPA for overseeing the rebuilding and operation of the grid, and all ideas, from privatization— 

which I am not really a fan of—but from privatization to creation 

of a new Federal Power Marketing Administration. All these things 

have to be up for discussion. And whatever road we go down must 

have buy-in from the Puerto Rican people and the Government. 

I don’t know if anybody wants my minute that I still have. If not, 

Mr. Chairman, I will yield back. 

[The prepared statement of Mr. Pallone follows:] 

PREPARED STATEMENT OF HON. FRANK PALLONE, JR. 

Mr. Chairman, thank you, for convening today’s hearing reviewing the disastrous 

2017 hurricane season, which has wreaked havoc on many parts of our country. I 

am grateful to former Senator Nieves of Puerto Rico and Mr. Rymer of the Virgin 

Islands for coming here today, but disappointed that the committee did not even receive a response to its outreach to the Puerto Rico Electric Power Authority 

(PREPA). I have serious concerns not only about how PREPA has overseen the effort to restore power in Puerto Rico, but also more broadly on how PREPA has managed—or more accurately, mismanaged—the grid in Puerto Rico over the years. 

Today we are focusing on the energy infrastructure recovery efforts, and I must 

say that accounts from the areas affected by these storms paint a dire situation that 

completely contradicts the often rosy stories that come from the White House. The 

truth is that, taken together, Puerto Rico and the Virgin Islands are currently experiencing the largest blackout in American history. And, this nightmare for our fellow 

citizens is far from over. 

The central questions for us today should be: why it is taking so long to restore 

power in Puerto Rico and the Virgin Islands, and who is actually in charge of the 

effort to restore power to Puerto Rico? No one person or entity seems to be in 

charge, and it is fostering a chaotic and ineffective effort to restore power on the 

island. I want answers and so do many of my colleagues on both sides of the aisle. 

I am also troubled by the maze of contracts with numerous companies for overlapping missions-a patchwork that is failing to turn the lights back on in Puerto Rico. 

It needs to change now. I am deeply concerned by the terms of the contracts PREPA 

signed with Whitefish and Cobra Acquisitions, which went so far as to bar PREPA 

from holding the companies liable for delayed completion of grid repair work or letting the Government audit their work. 

Governor Rossell¢ has since taken steps to have the Whitefish contract canceled, 

but we need to learn more about how these contracts are being awarded and whether the bidding process is truly competitive. That’s why Chairmen Walden and 

Upton, and Ranking Members Rush, DeGette and I have requested documents and 

a briefing from Whitefish so we can learn more about how that troubling agreement 

materialized. 

10 

Additionally, FEMA issued a statement that said it had no involvement in the development of this contract. My question is: why not? The Federal Government 

should be engaged in the contracting process of large scale rebuilding contracts for 

which U.S. taxpayers will ultimately foot the bill. The Federal Government needs 

to step up and take charge to expedite power restoration efforts. 

Missions like this are why we have a strong Federal Government—simply put, the 

Trump administration needs to be doing more. If we can’t get the power turned back 

on soon, more people are going to die. This is a humanitarian crisis, and our Government owes it to the citizens in these Territories to do everything it can to fix 

it. 

While restoring power quickly is the most urgent concern, it is also crucial that 

the grid in Puerto Rico and the U.S. Virgin Islands be rebuilt with more modern 

energy technologies focused on increased resiliency, energy efficiency and renewable 

energy. Replacing the old grid as it stood before the storm will cost taxpayers more 

money and do nothing to make electricity in Puerto Rico more reliable or affordable. 

As Congress prepares the next emergency spending bill, we must make changes 

to current law to enable the rebuilding to occur in a way that lays the groundwork 

for constructing a modern electricity grid in the Territories. Failing to invest wisely 

in Puerto Rico now will only cost all taxpayers more down the road. And, we must 

consider innovative ways for turning around Puerto Rico’s situation, including alternatives to PREPA for overseeing the rebuilding and operation of the grid. All ideas, 

from privatization to creation of a new Federal power marketing administration 

must be up for discussion. And, whatever road we go down, we must have buy-in 

from the Puerto Rican people and Government. 

Thank you. I look forward to hearing from our witnesses today. 

Mr. UPTON. The gentleman yields back. 

At this point we are ready for the testimony. Thank you in advance or thank you for sending your testimony in advance. It will 

be made part of the record. We would like each of you to take no 

more than 5 minutes to summarize your testimony. At that point, 

when that is completed, we will be asking questions. 

We are joined first by Patricia Hoffman, the Acting Undersecretary for Science and Energy, Principal Deputy Assistant Secretary 

for the Office of Electricity Delivery and Energy Reliability, at the 

Department of Energy. Welcome. Thank you. 

STATEMENTS OF PATRICIA HOFFMAN, PRINCIPAL DEPUTY ASSISTANT SECRETARY, OFFICE OF ELECTRICITY DELIVERY 

AND ENERGY RELIABILITY, DEPARTMENT OF ENERGY; RAY 

ALEXANDER, DIRECTOR OF CONTINGENCY OPERATIONS, 

ARMY CORPS OF ENGINEERS; DEANN T. WALKER, CHAIRMAN, PUBLIC UTILITY COMMISSION OF TEXAS; ROBERT F. 

CORBIN, DEPUTY ASSISTANT SECRETARY, OFFICE OF PETROLEUM RESERVES, DEPARTMENT OF ENERGY; AND 

FRANK RUSCO, DIRECTOR, NATURAL RESOURCES AND ENVIRONMENT, GOVERNMENT ACCOUNTABILITY OFFICE 

STATEMENT OF PATRICIA HOFFMAN 

Ms. HOFFMAN. Chairman Upton, Ranking Member Rush, and 

distinguished members of the subcommittee, I appreciate the opportunity today to discuss energy security and emergency response 

issues related to the 2017 hurricane season. 

The mission of the Office of Electricity Delivery and Energy Reliability is to develop innovative, cutting-edge solutions to ensure our 

Nation’s energy infrastructure remains reliable, affordable, and resilient. In order to fulfill this mission, the Department of Energy 

leverages the technical capabilities of National Laboratories and 

partnerships with the key private sector stakeholders to focus on 

early-stage research and transformative projects. 

11 

Our organization is also the lead for providing energy-related expertise to the Federal Energy Management Agency, also known as 

FEMA, our interagency partners, and the administration, as part 

of the Department of Energy’s emergency response activities. DOE 

serves as the lead organization for Emergency Support Function 12 

under the National Response Framework and as the sector-specific 

agency for energy. As the lead for ESF–12, DOE is responsible for 

providing information and analysis about energy disruptions and to 

assist in facilitating the restoration of damaged energy infrastructure. 

During Hurricanes Harvey, Irma, Maria, Nate, we have worked 

with industry and the Federal, State, Territorial, and local partners to facilitate response and recovery. Overall, DOE has received 

18 mission assignments and has deployed more than 110 personnel 

to the response efforts. Each of these storms has presented unique 

challenges to the energy sector. 

With respect to Hurricane Harvey, we saw peak electricity outages of about 300,000 customers in Texas and Louisiana. While offshore and onshore, crude oil and natural gas productions were disrupted by the storm, the greatest impacts were to the midstream 

and downstream oil and refining sectors. At its peak, more than 4 

million barrels per day of refining capacity, representing more than 

20 percent of the U.S. refining capacity, was offline. It took several 

weeks for floodwaters to recede, but the refining systems in Texas 

and Louisiana have resumed normal operations. In addition, flooding closed two key injection points along the Colonial Pipeline, forcing the system to operate intermittently at reduced rates for several weeks before normal service was resumed. 

Hurricane Irma, the second category 4 hurricane to make landfall in the United States this year, caused approximately 8 million 

electric customer outages from the Caribbean to the southeastern 

United States. At Irma’s peak on September 11th, there were approximately 7.8 million customer outages in Florida. Three days 

later, on September 14th, power had restored to approximately 5 

million customers, 64 percent of those customers. And five days 

later, restoration was at 98 percent. 

DOE is also playing a significant role in supporting the restoration and recovery efforts in the U.S. Virgin Islands and Puerto Rico 

from Hurricane Maria. In Puerto Rico, the U.S. Army Corps does 

have the primary role in emergency restoration and rebuilding the 

infrastructure, but DOE has deployed personnel and equipment 

from the Western Power Area Administration to provide mutual assistance through a mission assignment from FEMA and is working 

to facilitate additional mutual assistance with industry. 

Days after Bruce Walker was confirmed as the Department of 

Energy’s new Assistant Secretary for the Office of Electricity Delivery and Energy Reliability, he was on the ground in Puerto Rico 

assisting other DOE personnel in coordination with the Governor, 

PREPA, FEMA, and the Army Corps of Engineers. Recently, the 

Governor and PREPA have requested additional line workers and 

equipment necessary for the restoration of power. 

Secretary Perry and our DOE team look forward to a thoughtful 

conversation focused on our response and recovery efforts for this 

hurricane season, and a focus on reliability, affordability, and resilVerDate Mar 15 2010 12:53 Mar 12, 2018 Jkt 037690 PO 00000 Frm 00015 Fmt 6633 Sfmt 6633 C:\USERS\WLAUFERT\DESKTOP\115X72X2017HURRICANESWORKING WAYNE
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ience of the electricity system from hurricanes as well as other extreme weather events. 

I would like to take a moment and thank the hard utility workers for their time and their efforts in responding to the hurricane 

season. But, like any event, there is always some hard lessons 

learned, and we look forward to improving our efforts. 

So, thank you, and I look forward to your questions. 

[The prepared statement of Ms. Hoffman follows:] 

13 


Written Testimony of Principal Deputy Assistant Secretary Patricia Hoffman 

Office of Electricity Delivery and Energy Reliability 

U.S. Department of Energy 

Before the 

House Committee on Energy and Commerce 

Subcommittee on Energy 

November 2, 2017 

Chainnan Upton, Ranking Member Rush, and distinguished Members of the Subcommittee, l 

appreciate the opportunity today to discuss energy security and emergency response issues 

related to this active hurricane season. 

The mission of the Office of Electricity Delivery and Energy Reliability (OE) is to develop 

innovative, cutting-edge solutions to ensure that our Nation's energy infrastructure remains 

reliable, affordable, and resilient. In order to fulfil this mission, the U.S. Department of Energy 

(DOE or Department) leverages the technical capabilities of the National Laboratories and 

partnerships with key private sector stakeholders to focus on early-stage research and 

transformative projects. 

Our organization is also the lead for providing energy-related expertise to the Federal Emergency 

Management Agency (FEMA), interagency partners, and the Administration as part of DOE's 

emergency response activities. DOE serves as the lead agency for Emergency Support Function 

# 12 - Energy (ESF-12) under the National Response Framework and as the Sector Specific 

Agency for Energy. As the lead for ESF-12, DOE is responsible for providing information and 

analysis about energy disruptions and to assist in facilitating the restoration of damaged energy 

infrastructure. 

During Hurricanes Harvey, Irma, Maria, and Nate, and in the weeks following these events, we 

have worked with industry and Federal, state, territorial, and local partners to facilitate response 

and recovery. Specifically, as part of the whole-of-government response to these disasters, the 

Department deployed response personnel to support state emergency operations centers, FEMA 

Incident Management Assistance Teams, and regional and national response coordination 

centers, including several weeks of 24 hour coverage at FEMA's National Response and 

Coordination Center (NRCC) in Washington, DC. DOE's responders worked with interagency 

partners as well as with state government and industry representatives to identify information 

and resource gaps and inform DOE's engagements to support the restoration efforts. 
14 


Overall, DOE has deployed more than I 00 personnel to support the response to the 2017 

Hurricane Season from Headquarters, DOE sites across the country, the Power Marketing 

Administrations (PMAs), and DOE's National Laboratories. 

Hurricane Harvey 

Each ofthese storms presented unique challenges to the energy sector, With respect to 

Hurricane Harvey, we saw peak electricity outages of about 300,000 customers in Texas and 

Louisiana. While offshore and onshore crude oil and natural gas production was disrupted by the 

storm, the greatest impacts were to the midstream and downstream oil and refining sectors. At 

its peak, more than four million barrels per day of refining capacity, representing more than 20% 

of total U.S. refining capacity, was offline. It took several weeks for flood waters to recede, but 

the refining systems in Texas and Louisiana have resumed normal operations. In addition, 

flooding closed two key injection points along the Colonial Pipeline, forcing the system to 

operate intermittently at reduced rates for several weeks before normal service resumed. 

Hurricane Irma Response 

Hurricane Irma, the second category-four hurricane to make landfall in the United States this 

year, caused over seven million electric customer outages from the Caribbean to the southeast 

United States. 

At Irma's peak on September 11, there were 7.8 million electric customer outages in Florida. 

Three days later on September 14, power had been restored to about 5 million customers- 64% 

of those customers and 5 days later the restoration was at 98%. Overall, Florida Power and 

Light (FPL) was able to restore power at a pace roughly four times faster than it did after 

Hurricane Wilma in 2005. 

One of the reasons this expeditious restoration was possible is the mutual assistance provided by 

numerous electric utilities. The energy sector mobilized more than 60,000 workers from more 

than 250 investor-owned electric companies, public power utilities, and electric cooperatives 

from all across the United States and Canada to assist with power restoration. 

This restoration was aided by a number of factors, including the increased coordination between 

various levels of government and the private sector, which allowed the mutual assistance 

resources to rapidly access restoration locations. In addition, FPL has invested nearly $3 billion 

since 2006 to build a more storm-resilient electrical grid to reduce potential damage and outages, 

and to help restore power faster following outages. Some of these investments included smart 

meters and flood monitoring capabilities which allowed substations and electrical equipment to 

shut down more efficiently and with less damage. 

2 
15 


Hurricane Maria 

DOE is also continuing to play a significant role in supporting the restoration and recovery 

efforts in the U.S. Virgin Islands and Puerto Rico. In the U.S. Virgin Islands, DOE has deployed 

29 responders, including 25 personnel and I 0 line-trucks from the Western Area Power 

Administration to provide mutual assistance through a mission assignment from FEMA and has 

worked to facilitate additional mutual assistance with industry. 

Hurricane Maria made landfall in Puerto Rico as a Category 4 hurricane on September 20, 

bringing powerful winds and major flooding that destroyed much of the territory's transmission 

and distribution infrastructure and left virtually all 1.6 million electricity customers on the island 

without power. According to initial estimates from the Puerto Rico Electric Power Authority 

(PREP A), at least 80 percent of the transmission and distribution system was affected by 

Hurricane Maria. However, as of October 31, 33.4% of normal peak load has been restored. 

While this figure has little bearing on customer-level outcomes, it may be the best proxy 

available to measure progress in this challenging environment. 

In Puerto Rico, the United States Army Corps of Engineers (USACE) has assumed a significant 

role in the emergency restoration of electrical infrastructure. USACE Temporary Emergency 

Power Planning and Response Teams are assisting with assessments and generator installations 

at critical facilities. In October, USACE was also tasked to lead planning, coordination, and 

integration efforts to support Puerto Rico with the restoration of the electrical power grid due to 

impacts caused by Hurricane Maria. US ACE is managing this effort as the lead for Emergency 

Support Function #3- Engineering and Public Works, in close coordination with DOE. 

DOE has a responder deployed to coordinate with FEMA as well as seven subject matter experts 

from the PMAs to provide technical support to USACE with restoration planning, cost estimates, 

validation, and quality assurance. Additionally, through DOE-funded projects, we arc leveraging 

the expertise of our National Laboratories to develop potential long-term solutions to improve 

the resiliency of the Puerto Rican infrastructure. I want to assure the Committee that DOE will 

continue to support the work needed to restore power to the U.S. Virgin Islands and Puerto Rico. 

Conclusion 

I am grateful for the hard work of DOE's emergency responders in this active and challenging 

hurricane season. We have made progress, but there is still more to do. Over the next several 

months, DOE's primary focus in Puerto Rico and the U.S. Virgin Islands will be working with 

our partners to support the mission of restoring the power grids and critical infrastructure. 

Secretary Perry and our DOE team look forward to a thoughtful conversation focused on our 

response to this season's hurricanes, and on the reliability, affordability, and resilience of the 

electricity system from hurricanes, as well as other extreme weather events. 

3 
16 


Thank you, and I look forward to your questions. 

4 
17 

Mr. UPTON. Thank you very much. 

Next, we’re joined by Ray Alexander, the Director of Contingency 

Operations for the Corps of Engineers. 

Welcome. 

STATEMENT OF RAY ALEXANDER 

Mr. ALEXANDER. Chairman Upton, Ranking Member Rush, and 

members of the subcommittee, my name is Ray Alexander, Director 

of Contingency Operations, the U.S. Army Corps of Engineers. 

Thank you for the opportunity to testify today. 

The Corps conducts emergency response activities under two 

basic authorities, the Stafford Act and Public Law 84–99. Under 

the Stafford Act, we support FEMA under the National Response 

Framework as the lead Federal agency for Emergency Support 

Function 3, public works and engineering. ESF–3 provides temporary emergency power, roofing, and housing, debris management, 

infrastructure assessment, and critical public facility restoration. 

Under Public Law 84–99, we prepare for disasters through planning, coordination, and training with local, State, and Federal partners. We assist State and local entities to implement advanced 

measures that prevent or reduce storm event damages. We repair 

damage to authorized Federal projects and work with States and 

municipalities to rehabilitate and restore eligible non-Federal flood 

infrastructure to prestorm conditions. 

When disasters occur, Corps teams and resources are mobilized 

from across the command to assist local offices with their response 

to the event. As part of this mission, the Corps has more than 50 

specially-trained teams supported by emergency contracts that perform the wide range of support missions I just described. These 

contracts are preawarded and can be quickly activated to execute 

many of these missions. 

This year the Corps has supported FEMA-led Federal response 

and recovery operations in multiple events, including Hurricanes 

Harvey, Irma, and Maria. FEMA directed 37 mission assignments 

to the Corps for Hurricane Harvey. Currently, the Corps has 195 

employees deployed. The Corps assisted in temporary emergency 

power and continues to support the State of Texas in the development and implementation of a temporary housing project management plan. Debris teams led by subject matter experts continue to 

provide States and municipalities the technical assistance to define 

requirements and monitor debris removal and disposal operations 

in 15 counties. 

FEMA directed 81 mission assignments to the Corps for Hurricanes Irma and Maria. Currently, the Corps has over 1500 personnel deployed. As of this morning, the Corps has completed over 

1,000 assessments and over 500 temporary generator installations 

in the Caribbean. This includes 250 assessments and 150 installations in the U.S. Virgin Islands and over 750 assessments and 400 

installations in Puerto Rico. Under FEMA authority, we are assisting Puerto Rico with the operation and maintenance of critical nonFederal generators across the island as well. 

The Corps has completed over 14,000 temporary roofing installations in Florida and is on track to complete that mission by 4 November. We have also completed over 7,000 temporary roofing inVerDate Mar 15 2010 12:53 Mar 12, 2018 Jkt 037690 PO 00000 Frm 00021 Fmt 6633 Sfmt 6633 C:\USERS\WLAUFERT\DESKTOP\115X72X2017HURRICANESWORKING WAYNE
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stallations in the Caribbean, including over 2500 in the U.S. Virgin 

Islands and 4700 in Puerto Rico. Roofing requirements have been 

extensive, requiring additional material and construction support, 

which initially slowed progress. We have adjusted. We have added 

additional capacity, and we are seeing daily improvements. 

Corps debris subject matter experts provided technical assistance 

to counties across Florida and Georgia in response to Hurricane 

Irma, and continue to provide oversight to five regions within the 

Florida Department of Emergency Management. The Corps is 

working to remove an estimated 1 million cubic yards of debris in 

the U.S. Virgin Islands and over 6 million cubic yards in Puerto 

Rico. 

The Corps works closely with the U.S. Coast Guard and the National Oceanic and Atmospheric Administration and local authorities to open harbors and navigation channels across all affected 

areas, critical to restoring commerce and the flow of commodities, 

and essential equipment to reach affected communities. 

The Corps worked closely with officials of Texas and Florida to 

manage local flood control reservoirs during a period of unprecedented rainfall. In Puerto Rico, Corps dam and levee teams inspected 17 priority dams and worked closely with the Puerto Rico 

Electrical Power Authority, PREPA, to stabilize a spillway feature, 

the Guajataca Dam. Additionally, the Corps cleared existing outflow conduits and placed emergency pumps to further reduce water 

levels in the dam, and restored flow to a critical treatment plant 

that supports the needs of over 30,000 people. 

On September 30th, the Corps received a FEMA mission assignment under Stafford Act authority to assist PREPA in conducting 

emergency repairs to the power grid itself. We are partnering with 

PREPA. We have established a general officer and senior-executive-led task force to oversee work and provide technical assistance. 

The Department of Energy has embedded experts in our team 

and continues to assist in our efforts. Within two weeks of receiving this mission assignment, we awarded contracts for large-scale 

temporary power generation to stabilize the grid in San Juan and 

for additional line repair assets that will assist ongoing efforts by 

PREPA. 

The Corps remains fully committed and capable of executing 

other Civil Works activities across the Nation, despite our heavy 

involvement in these ongoing response and recovery operations. We 

also remain ready and poised to assist in future events, should they 

occur. 

This concludes my testimony, and I look forward to answering 

any questions you may have. Thank you. 

[The prepared statement of Mr. Alexander follows:] 

19 


DEPARTMENT OF THE ARMY CORPS OF ENGINEERS 

COMPLETE STATEMENT OF 

MR.CHARLES(RAY)ALEXANDER 

DIRECTOR OF CONTINGENCY OPERATIONS 

BEFORE 

COMMITTEE ON ENERGY AND COMMERCE 

SUBCOMMITTEE ON ENERGY 

UNITED STATES HOUSE OF REPRESENTATIVES 

ON 

THE 2017 HURRICANE SEASON: A REVIEW OF EMERGENCY 

RESPONSE AND ENERGY INFRASTRUCTURE RECOVERY EFFORTS 

NOVEMBER 2, 2017 
20 


Mr. Chairman and distinguished members of the Subcommittee: 

I am honored to testify before you today to discuss the authorities and responsibilities of 

the U.S. Army Corps of Engineers (Corps) during disaster response and recovery 

operations. I am Ray Alexander, Director of Contingency Operations for the U.S. Army 

Corps of Engineers. 

The Corps conducts its emergency response activities under two basic authorities: the 

Stafford Disaster and Emergency Assistance Act (Stafford Act); and Public Law 84-99, 

33 U.S.C. 701 n as amended (PL 84-99). Under the Stafford Act, we and other Federal 

agencies support the Federal Emergency Management Agency (FEMA) under the 

National Response Framework (NRF). In this capacity, the Corps is the lead Federal 

agency for Emergency Support Function 3 (Public Works and Engineering), but works 

under FEMA's direction. ESF-3 provides Temporary Emergency Power, Temporary 

Roofing, Debris Management, Emergency Infrastructure Assessment, Critical Public 

Facility Restoration, Temporary Housing, Demolition/Structural Stabilization, and 

support to FEMA Command and Control Nodes/ESF3. Under PL 84-99, we prepare for 

disasters through planning, coordination, and training with local, state, Federal partners; 

and by assisting state and local entities in implementing advance measures to 

prevent/reduce storm event damages. After the emergency event, PL 84-99 authorizes 

the Corps to repair damage to authorized Corps projects, and work with 

states/municipalities to rehabilitate and restore eligible non-Federal flood infrastructure 

to pre-storm conditions. 

When disasters occur, Corps teams and other resources are mobilized from across the 

country to assist the local Corps districts and offices respond to the event. As part of 

this mission, the Corps has more than 50 specially-trained response teams, supported by 

emergency contracts, to perform the wide range of public works and engineering-related 

support missions I just described. Additionally, the Corps uses pre-awarded contracts that 

can be quickly activated for missions such as debris removal, temporary roofing, 

commodities distribution, and generator installation. 

2017 Hurricane Season- With regard to hurricane activity, 2017 has been an 

unusually active season. The Corps has been involved in the FEMA-Ied Federal 

response and recovery operations in support of multiple events, including Hurricanes 

Harvey, Irma, and Maria. 

Hurricane Harvey -On August 25, 2017, Category 4 Hurricane Harvey made landfall 

along the central Texas coast near Rockport, Texas, between Port Aransas and Port 

O'Connor and the President approved an Expedited Major Disaster Declaration for 

Texas. Large amounts of rainfall fell across the greater Houston metropolitan area 

causing record flooding. FEMA has identified $93.7 million in Mission Assignments for 

the Corps to assist in Hurricane Harvey response and recovery. Currently, the Corps 

has 201 Corps employees deployed at key response nodes. 

2 
21 


Temporary Emergency Power: As of September 11, 2017, the Corps completed 68 

pre-installation inspections and 45 generator installations at identified critical public 

facilities fulfilling the temporary emergency power mission in Texas. 

Temporary Housing: Corps teams, in conjunction with FEMA, continue to assist the 

State of Texas with the development and implementation of a temporary housing 

Project Management Plan. The plan includes establishing 20,000 travel trailers and 

4,000 mobile housing units. The Corps continues to conduct reconnaissance and 

assessments, identifying sites to fulfil the scope of this plan, and establishing 

conceptual layouts for the assessed sites. The Direct Housing Assessment Team is 

providing technical monitors that continue to prepare Site Inspections Reports in 26 

counties. 

Debris Management: Debris Teams led by Corps subject matter experts continue to 

provide locals with technical assistance in defining requirements and monitoring debris 

removal and disposal operations in 15 counties. 461 ,000 cubic yards of debris have 

been removed to date and that number continues to rise. 

Hurricanes Irma and Maria- Category 5 Hurricane Irma made landfall over the U.S. 

Virgin Islands on September 6, 2017, while also impacting Puerto Rico with Category 2 

winds, 12 foot storm surge and up to 20 inches of rain. Hurricane Irma made landfall in 

southern Florida/Florida Keys on September 9, 2017. Soon thereafter, Category 5 

Hurricane Maria made landfall over Puerto Rico on September 20, 2017, causing major 

damage to critical infrastructure and homes. FEMA has identified $1.7 billion in Mission 

Assignments for the Corps to assist in Hurricanes Irma and Maria response and 

recovery (45 Mission Assignments totaling $176.3 million for Hurricane Irma and 34 

Mission Assignments totaling $1.5 billion for Hurricane Maria). Currently, the Corps has 

over 1 ,243 personnel deployed in various locations supporting the recovery missions. 

Temporary Emergency Power: As of October 31, 2017, the Corps and its contractors 

have completed 7 40 of 827 requested pre-installation inspections (for temporary 

generators) and 392 generator installations in Puerto Rico. The Corps and its 

contractors have completed 249 of 277 pre-installation inspections (for temporary 

generators) and 140 general installations in the U.S. Virgin Islands. 

Temporary Roofing: In order for the Corps and its contractors to install temporary 

covering (blue roof), the government and its contractors require validated rights of entry. 

As of October 31, 2017, the Corps and its contractors have completed 13,127 blue roof 

installations and collected 14,822 validated rights of entry in Florida. At this time, 

requests for temporary roofing have begun to decrease in Florida. In the U.S. Virgin 

Islands, the Corps and its contractors have completed 2,255 blue roof installations and 

collected 4,120 rights of entry. An additional contractor began blue roof installations on 

October 24, 2017. In Puerto Rico, the Corps and its contractors have completed 3,986 

blue roof installations and collected over 17,000 rights of entry. 

3 
22 


Debris Management: As of October 31, 2017, the Corps has removed approximately 

141,000 cubic yards of the estimated over 1 million cubic yards of debris in the U.S. 

Virgin Islands and 62,500 cubic yards of the estimated over 6 million cubic yards of 

debris in Puerto Rico. Corps debris subject matter experts provided technical 

assistance to counties across Florida and Georgia in response to Hurricane Irma and 

continue to provide oversight to five regions within the Florida Department of 

Emergency Management. 

Dam and Levee Safety. Assessments, and Response: In Puerto Rico, Corps Dam and 

Levee teams inspected 17 priority dam locations and Guajataca Dam was the only site 

deemed in critical condition. Hurricane Maria caused a significant rise in the water level 

of the dam, and resulted in overflow of the spillway. The spillway structure was 

compromised and the surrounding area began to erode, posing immediate risk to 

70,000 residents. Corps teams placed over 500 Jersey barriers and over 1,300 super 

sand bags to cease any further erosion and allow for long-term repair of the spillway. 

Additionally, the Corps teams cleared existing outflow conduits and are positioning to 

place piping and pumps to further reduce the water level in the dam. When the water 

level reaches 25 feet below the spillway, more substantial repairs will begin. 

Power Mission: On September, 30 2017, the Corps was given a FEMA Mission 

Assignment, within the authority of the Stafford Act, to assist the Puerto Rico Electric 

Power Authority (PREP A) in further repairing the power system to its pre-storm 

condition. The Corps is conducting this mission. 

The Corps remains fully committed and capable of executing its other Civil Works 

activities across the Nation despite our heavy involvement in these ongoing response 

and recovery operations. We also remain ready and poised to assist in future events as 

they may occur. This concludes my testimony and I look forward to answering any 

questions you might have. Thank you. 

4 
23 

Mr. UPTON. Thank you very much. 

Next is DeAnn Walker, the Chair of the Public Utility Commission for Texas. You have got to be a happy woman today as well 

with the Astros. 

STATEMENT OF DEANN T. WALKER 

Ms. WALKER. Yes. Thank you very much for your invitation to 

appear here today. 

My name is DeAnn Walker. I am the chairman of the Public 

Utility Commission of Texas. I have happily held that seat since 

September 20th. So, I am new to this. 

I believe I have a unique perspective on restoration from hurricanes. The State Operations Center in Texas creates what they call 

a Tiger Team of utility personnel that is located within the State 

Operations Center to help with restoration, to coordinate with Federal/State officials throughout an event. I have now served three 

hurricanes in the State Operations Center. Hurricane Rita and 

Hurricane Ike, I was actually representing a utility in the State 

Operations Center. During Hurricane Harvey, I was working for 

Governor Abbott and was down in the State Operations Center 

working with the utilities to restore service. 

We believe that the electric industry and the infrastructure in 

Texas fared very well during Hurricane Harvey compared to past 

hurricanes. As has been stated, we had under 350,000 at any one 

time. We had more than that, but the utilities were continually restoring service during that time. The longest we had any customers 

out was for two weeks, and that was in the Rockport area, which 

was the direct hit of the eye of Hurricane Harvey. So, it took the 

brunt of it. During a storm, the PUC, as I said, works with State, 

Federal, and local agencies to restore power. 

I wanted to focus the rest of my time on what we are taking as 

action items to better prepare for a new hurricane. Due to the 

amount of flooding that we had, some cities and towns, areas received 60 inches of rain throughout Hurricane Harvey. Many substations in our area flooded for the first time ever. So, we are looking at, and we moved in for the first time ever, mobile substations 

to help serve those customers. We are looking at whether or not it 

is prudent for the State as a whole, all of the utilities to get together and purchase these mobile substations to have on hand in 

such an event. We are also working with the utilities to elevate 

those substations when they rebuild them, so that we are taking 

care of hardening the system in the process of rebuilding. 

I have also asked the State to look at whether or not we can better utilize utilities within Texas to send equipment and personnel. 

We were drawing people from all over the United States under mutual assistance crews, which we greatly appreciate, but I would like 

us to look and see if we can rely on the Texans that we have. SPS 

in the Panhandle and El Paso in far west Texas never were called 

on to help, and obviously, they were closer than a lot of places. 

We have been working through the process with FEMA for how 

to interconnect their temporary housing, so that we could have one 

seamless process for all utilities to implement. We are trying to do 

that on the fly. I would like us to further address that process in 

the meantime before the next storm hits us. 

24 

We also learned that not every utility is reporting outages consistently. In Texas we require that all utilities report outages to us 

and to DOE on a county- and ZIP-code-wide basis, but there is not 

consistency between the utilities on how that was being done. For 

instance, some of the flooded substations, once they had a plan to 

bring in the mobile substation, they took those outages and moved 

them to planned outages. So, they were no longer showing up as 

being impacted by the hurricane. I don’t think that is an accurate 

representation. So, I have asked to look at that. 

There are many other things that we have started looking at to 

correct and to, hopefully, do better. I am running out of time. I 

wanted to, again, thank you for your time today. 

[The prepared statement of Ms. Walker follows:] 

25 


STATEMENT OF DEANN T. WALKER 

CHAIRMAN OF THE 

PUBLIC UTIUTY COMMISSION OF TEXAS 

BEFORE THE U.S. HOUSE OF REPRESENTATIVES 

COMMITTEE ON ENERGY AND COMMERCE 

SUBCOMMITTEE ON ENERGY 

"THE 2017 HURRICANE SEASON: A REVIEW OF EMERGENCY RESPONSE 

AND ENERGY INFRASTRUCTURE RECOVERY EFFORTS" 

NOVEMBER 2, 2017 
26 


DcAnn T. Walker 

Written Testimony before Energy Subcommittee 

November 2, 2017 

Page 2 of 12 

Summary 

Hurricane Harvey will be one of the most costly natural disasters in United States history. 

It made landfall near Rockport, Texas, at approximately 10:00 P.M. on August 25, 2017, as a 

Category 4 storm. It ultimately impacted the Texas coastline from Corpus Christi to the Louisiana 

border. There was significant damage in the Corpus Christi area due to the high wind speeds, 

while the Houston to Louisiana area mainly experienced severe flooding. The PUCT's initial 

assessment is that Texas utilities generally did an outstanding job responding to the storm. Power 

was restored to the vast majority of customers that could receive power by the second week after 

landfall of the storm, which was remarkable given the inability to access many areas until early 

September. 

During an event, such as Hurricane Harvey, the State Operations Center (SOC) assembles 

a team of individuals from the affected electric utilities to work collaboratively with the PUCT as 

well as State and Federal officials on restoration of the electric system. At the SOC, the PUCT is 

the lead agency on issues related to electric outages and restoration, serving as the liaison with 

utilities, electric generators, key industrial facilities, other state agencies, and local officials, in 

order to provide situational awareness and facilitate restoration. During a storm, the PUCT as well 

as other State officials and agencies work closely with Federal agencies in order to facilitate 

restoration of electric service to an affected area. These agencies include the Department of 

Energy, the Army Corp of Engineers, the Federal Energy Management Agency, and the 

Department of Homeland Security. 
27 


De Ann T Walker 

Written Testimony before Energy Subcommlttce 

November 2, 2017 

Page 3 of 12 

Introduction 

Chairman Upton, Ranking Member Rush, and members of the Subcommittee, 

My name is DeAnn Walker, and I am the Chairman of the Public Utility Commission of 

Texas (PUCT). The PUCT is the regulatory body in Texas for electric, telecommunications, and 

water utilities, with the majority of work relating to the oversight of electric utilities that serve 27 

million Texans, most of them through fully competitive wholesale and retail markets. I want to 

thank you for the opportunity to testify today and provide the perspective of the State of Texas on 

the electric sector's response to Hurricane Harvey. 

Overview of Hurricane Harvey 

As you are aware, Hurricane Harvey will end up as one of the most costly natural disasters 

in United States history. It made landfall near Rockport, Texas, at approximately I 0:00 P.M. on 

August 25, 20I 7, as a Category 4 storm and was the strongest hurricane to hit the Texas coast since 

Hurricane Carla in 1961. Port Aransas and Rockport, which are directly northeast of Corpus 

Christi, experienced sustained winds in excess of I 00 miles per hour with gusts that exceeded 135 

miles per hour. Hurricane Harvey, unlike Hurricanes Ike and Rita, then stalled inland and slowly 

meandered around southeast Texas for the next three days, ultimately re-entering the Gulf, and 

making its final landfall just cast of the Texas-Louisiana border on August 30, 2017. 

The path of Harvey presented a number of unique issues related to the Texas electric sector. 

First, the short time period over which Harvey strengthened into a hurricane as well as the wide 

range of potential locations for its landfall limited the time for utilities to prepare and stage crews. 
28 


DeAnn T Walker 

befbre Energy Subcommtttec 

Figure I shows the wide divergence in forecast models two days before the storm hit with 

essentially the entire Texas coast being at risk. 

Figure 1: August 23 Hurricane Harvey Forecast Track Map 

Second, the peak wind gusts of the storm as it made initial landfall reached 150 miles per 

hour in some areas (Figure 2). This created substantial wind storm damage to the electric 

infrastructure in the Rockport and Port Aransas areas. AEP Texas, the primary electric provider 

in this area, ultimately experienced impacts to 68 transmission substations, had 61 transmission 

lines that locked out during the storm, had 766 transmission structures downed or damaged, needed 

to repair or replace over 5,700 distribution poles, and replaced 712 miles or nearly 4 million feet 

• of transmission and distribution conductor. 
29 


De:Ann T Walker 

Subcommittee 

Figure 2: Hurricane Harvey Peak Wind Gusts 

While that amount of damage to the infrastructure was substantial and a challenge to repair 

under typical storm aftermath, Harvey proceeded to persist as a Tropical Storm and stalled in the 

AEP Texas service area for a substantial amount of time remaining inland as a named storm for 

117 hours after initial landfall. The resulting persistent wind conditions and flooding created 

significant challenges for AEP Texas to fully assess the status of the system, as well as making 

ingress to impacted areas very difficult and dangerous. Figure 3 shows the meandering route taken 

by the storm through August 28'h when Harvey re-entered the Gulf of Mexico. 
30 


DeAnn T, Wa1kcr 

befOre t:ncrgy Subcommittee 

Figure 3: Harvey Storm Track through August 281h 

As AEP Texas and other utility providers began the restoration process in the areas of 

Texas to the northeast of Corpus Christi, Harvey's rain bands continued across the Houston area, 

and later, the Beaumont and Port Arthur areas. As electric utility outages began to drop in the 

AEP Texas service area, outages began to increase in the CenterPoint Energy, Texas New-Mexico 

Power, and Entergy service areas, primarily due to flooding, wind damage from tornadoes, and 

lightning strikes. At least 37 tornadoes were declared to have occurred between Port O'Connor 

and Beaumont from August 25 through August 29, with hundreds of tornado warnings issued, and 

the Houston area experienced more than 42,000 lightning strikes. 
31 


DcAnn T Walker 

before Energy Subcommittee 

There was also unprecedented torrential rain experienced by much of this area. Figure 4 

shows the scale of historic flooding. To provide a sense of the scale of the flooding caused by the 

storm, approximately 27 trillion gallons of water rained down over six days. The area of Texas 

covered by more than 40 inches of rain is larger than the states of Delaware and Rhode Island 

combined. The area covered by 20 inches ofrain is ten states, including West Virginia. 

Figure 4: Precipitation over Southeast Texas from August 23 to August 30 

The scope and degree of this flooding presented obvious challenges to restoration of the 

electric. system. First and foremost, many areas were simply inaccessible for as long as a week 

after the storm passed the area. Utilities had to reach equipment by boat or air boat, all-terrain 

vehicles, or amphibious and high water vehicles, and had to use helicopters and drones to reach 

areas to make damage assessments. Secondly, the extensive flooding impacted utility equipment 

particularly substations-" that had never before experienced flooding issues. For Entcrgy Texas, 

the loss of the City of Beaumont's water supply required the relocation of Entergy's command 
32 


DeAnn T Walker 

Written Testimony before Energy Subcomm1t1ee 

November 2, 20! 7 

Page 8 of 12 

center to Conroe, which is approximately 100 miles away from Beaumont, and distribution 

operations center to Baton Rouge, which is approximately 190 miles away. In addition, Interstate 

10 into Beaumont was closed on either side of the city. 

Utilitv Response 

Even with these unprecedented challenges, the PUCT's initial assessment is that Texas 

utilities generally did an outstanding job responding to the storm. Power was restored to the vast 

majority of customers that could receive power by the end of the first week in September, which 

was remarkable given the inability to access many areas until early September. 

Figure 5 shows the PUCT's daily recording of electric outages at a 4:00P.M. snapshot for 

every day of the event. The chart illustrates the path of the storm from initial landfall in the AEP 

Texas service area, followed by its movement toward Houston, which is the CenterPoint Energy 

service area, and ultimate final landfall in the Entergy service area, which includes Beaumont and 

Port Arthur. Total storm outages did not exceed 350,000 simultaneous customers, although the 

total number of customer restorations was much higher as utilities worked to restore outages as 

they occurred throughout the storm and aftermath. Areas with the most long-lasting outages were, 

as expected, those areas with wind-storm damage from the initial landfall as well as customers 

served from severely flooded substations. 
33 


Dc:Ann T Walker 

bc!Ore Energy Subcomtmttee 

Figure 5: Electricity Outages During Hurricane Harvey Event 

--oth~r 

The efforts of the Texas utilities to modernize the electric grid through advanced metering 

infrastructure and other intelligent grid technologies appears to have suhstantially aided in utility 

restoration. CenterPoint Energy alone operated 250 devices impacting !40,000 customers that 

helped to avoid over 41 million outage minutes for customers. AEP Texas, Texas-New Mexico 

Power, and CenterPoint Energy were able to utilize advanced metering systems to(!) remotely 

have knowledge of power outages without the need for customers to call in; (2) execute service 

orders remotely; and, (3) accurately bill customer accounts without the usc of estimation routines 

that have resulted in significant issues in past storms. 
34 


DeAnn T Walker 

before Energy Subcommlttec 

As discussed above, utilities also utilized new technologies, such as drones, to assess 

damage, evaluate work conditions, and increase real-time situational awareness, and deployed 

mobile and temporary substations to route power around flooded and damaged substations. 

The PUCT's Role in Emergency Response 

Because of the broad and complex array of natural and other threats that face Texas and 

the importance of Texas' energy infrastructure to the nation, the PUCT, together with state 

leadership and other state agencies, considers emergency response planning and recovery as a key 

function of the agency, particularly given our unique role overseeing the Electric Reliability 

Council of Texas (ERCOT). The Texas State Operations Center (SOC) operates around the clock 

to monitor and analyze these threats to the State, and is activated when disasters pose an imminent 

threat to Texas. During an event, such as Hurricane Harvey, the SOC assembles a team of 

individuals from the affected electric utilities to work collaboratively with the PUCT as well as 

State and Federal officials on restoration of the electric system. 

At the SOC, the PUCT is the lead agency on issues related to electric outages and 

restoration, serving as the liaison with utilities, electric generators, key industrial facilities, other 

state agencies, and local officials, in order to provide situational awareness and facilitate 

restoration. During Ilarvey, these activities included the following: 

• working with the Texas Department of Transportation and the Texas Department of Public 

Safety to facilitate utility crew movement and escorts for large utility equipment, such as 

mobile substations; 

• coordinating with ERCOT, utilities, and refineries to facilitate rapid restart of refineriesparticularly in the Corpus Christi area; 
35 


DeAnn T Walker 

Written TestJmony before Energy Subcommittee 

November 2, 2017 

Page 11 of12 

• coordinating with ERCOT and the Railroad Commission of Texas regarding natural gas 

supply prioritization to electric generators; and, 

• working with the Office of the Governor on rule and statute suspension, where needed, to 

facilitate restoration. 

During a storm, the PUCT as well as other State officials and agencies work closely with 

Federal agencies in order to facilitate restoration of electric service to an affected area. These 

agencies include the Department of Energy, the Army Corp of Engineers, the Federal Energy 

Management Agency (FEMA), and the Department of Homeland Security. Issues that are 

addressed include the following: 

• reporting of outages and estimated restoration times; 

• potential need for emergency power provisions between Entergy and the ERCOT 

system; 

• prioritizing restoration of critical infrastructure; 

• siting and interconnecting back-up generators for critical customers; 

• facilitating the utility connections for FEMA mobile housing units; and, 

addressing the process for inspections of facilities for reconnection after repairs 

have been completed and electric service needs to be restored. 

PUCT's After Action Items 

While the preliminary assessment is that the State's emergency management planning and 

system, as well as the preparations and restoration efforts by the utilities during and after the storm 

event, proved to be effective, there is room to improve for the next storm. As such, the PUCTwill 
36 


DcAnn T Walker 

Written befOre Energy Subcommttlec 

November 2, 

Page 12 of12 

conduct an after-action review of a number of items, including reviews of the inventory of spare 

utility equipment among Texas utilities, communication methods by utilities to the public and state 

officials on outage status, evaluation of the utilities' mutual assistance programs and equipment 

sharing, and issues unique to market processes in the ERCOT competitive retail electricity market. 

Conclusion 

I want to thank the Subcommittee for the opportunity to provide a Texas perspective on 

these issues. Ensuring the reliability and recovery of our nation's power grid after major weather 

events is an exceptionally important and complex undertaking, and I applaud your focus on this 

subject. I stand ready to work with you to continue active and productive coordination between 

the Federal and State agencies in future events. 
37 

Mr. UPTON. Thank you. 

Next, we are joined by Robert Corbin, Deputy Assistant Secretary for the Office of Petroleum Reserves, the U.S. Department 

of Energy. 

STATEMENT OF ROBERT F. CORBIN 

Mr. CORBIN. Chairman Upton, Ranking Member Rush, and distinguished members of the subcommittee, it is an honor to appear 

before you today to discuss the Strategic Petroleum Reserve. 

The Strategic Petroleum Reserve, or SPR, was established under 

the authority of the Energy Policy and Conservation Act in December 1975. At that time U.S. oil production was in decline, oil price 

and allocation controls separated the U.S. oil market from the rest 

of the world, and the global commodity market for oil as we know 

it now did not exist. 

Today the global oil market has changed the environment in 

which the SPR operates. Although domestic oil production has increased dramatically in recent years, the global oil market is the 

largest commodity market in the world, making U.S. consumers 

subject to global commodity price fluctuations. Regardless of U.S. 

oil import levels, a severe global oil supply disruption today would 

impact domestic petroleum product prices. 

In the event of a serious interNational oil supply disruption, offsetting disrupted supplies with SPR crude oil in concert with other 

countries that hold strategic oil stocks can help reduce an increase 

in interNational oil prices and the resulting adverse economic impacts that could otherwise occur. 

The SPR maintains and operates four major oil storage sites, two 

in Texas and two in Louisiana. The SPR’s current crude oil inventory is approximately 670 million barrels stored in 60 underground 

salt caverns with a design capacity of 713.5 million barrels. The 

SPR is designed to provide the capability to draw down and deliver 

crude oil from the storage sites to designated distribution points, 

a design drawdown rate of 4.415 million barrels per day. The SPR 

can physically begin to draw down crude oil in as little as two days 

of notification, and taking into account the time required to meet 

sales requirements and draw down and deliver crude oil within 13 

days of a presidential finding. SPR operating costs are less than 25 

cents per barrel of design capacity per year, the lowest reported 

cost among oil stock-holding Nations. 

As a member of the InterNational Energy Agency, or IEA, the 

U.S. has two primary oil stock-holding obligations. As a net oil importer, the U.S. must maintain oil stock-holding inventories equal 

to at least 90 days of net petroleum imports. As of June 30th, 2017, 

the U.S. held 149 days of net petroleum imports. 

The U.S. must also be able to contribute a proportionate share 

to an IEA collective action in response to an oil supply disruption, 

based on its percentage share of IEA oil consumption. As of June 

30th, 2017, the U.S. must contribute 43.2 percent of all barrels released during any IEA collective action. 

As global oil trade increases, the potential role of the SPR to help 

mitigate global supply disruptions expands, regardless of the level 

of U.S. net oil imports. Without the ability to replace disrupted oil 

38 

supplies in the global market, global oil prices could increase significantly and the U.S. and global economy could be harmed. 

SPR infrastructure has performed capability to ensure the SPR 

has been able to respond to every emergency release situation presented throughout its history. However, SPR facilities are aging. A 

significant amount of infrastructure components are at or beyond 

their design life, and equipment will be further stressed due to 

nine consecutive years of congressionally mandated crude oil sales. 

Congress, recognizing the need to modernize SPR infrastructure, 

included provisions in the Bipartisan Budget Act of 2015 to address 

this concern by authorizing the drawdown and sale of up to $2 billion worth of SPR crude oil over a 4-year period to carry out an 

SPR modernization program. In response, the SPR has initiated a 

major capital asset acquisition project to modernize aging SPR infrastructure for systems upgrades and equipment replacement to 

ensure the SPR can meet mission requirements for the next several 

decades. 

Hurricane Harvey severely impacted U.S. Gulf Coast crude oil infrastructure, closing refineries, ports, and supply pipelines. Many 

impacted refiners were operable following the passage of Harvey, 

but in some cases were unable to secure crude oil feedstock to recommence or continue operations, resulting in multiple requests for 

emergency exchanges of SPR crude oil. After assessing prevailing 

supply conditions and consulting with other Federal agencies regarding the status of crude oil infrastructure, the SPR received approval from the Secretary of Energy to execute six emergency exchange agreements. First deliveries of crude oil were provided on 

August 30th, just two days after the initial request was received. 

Deliveries to the remaining companies also commenced within days 

after those requests were received and continued until deliveries 

totaling 5 million barrels were completed on September 28th. 

These emergency exchanges helped alleviate the loss of crude oil 

supply, allowing the affected refiners to begin and/or continue operations that otherwise would have been halted due to the impacts 

of Hurricane Harvey. 

This concludes my statement. Thank you for the opportunity to 

speak with you today about the SPR, and I look forward to answering any of your questions. 

[The prepared statement of Mr. Corbin follows:] 

39 


Testimony of Deputy Assistant Secretary Robert F. Corbin 

Office of Petroleum Reserves 

U.S. Department of Energy 

Before the 

U.S. House Committee on Energy and Commerce 

Energy Subcommittee 

November 2, 2017 

Chairman Upton, Ranking Member Rush, and Members of the Subcommittee, it is an honor to 

appear before you today to discuss the Strategic Petroleum Reserve (SPR). 

Mission and Role of the U.S. Strategic Petroleum Reserve 

The mission of the SPR is to protect the United States economy from severe petroleum supply 

interruptions through the acquisition, storage, distribution, and management of emergency 

petroleum stocks, and to carry out U.S. obligations under the International Energy Program 

(IEP). 

From October 1973 to March 1974, the Organization of Arab Petroleum Exporting Countries 

(OAPEC) imposed an oil embargo on the United States due to U.S. support of Israel during the 

Yom Kippur War of October 1973. In response, the United States Congress passed, and 

President Gerald R. Ford signed, the Energy Policy and Conservation Act (EPCA) in December 

1975. Among other initiatives, it authorized the establishment of the SPR and called for a 

stockpile of petroleum that could mitigate the economic damage of disruptions. 

The SPR remains a key national energy security asset, even as the nature of energy security 

evolves. Today's lower oil prices, increased domestic oil production, and reduced U.S. oil 

import dependency have changed the U.S. energy landscape. 

Since the establishment of the SPR in 1975, U.S. and global oil markets have changed the 

environment in which the SPR operates. When the SPR was established, U.S. oil production was 

in decline and oil price and allocation controls separated the U.S. oil market from the rest of the 

world. At the time, a truly global commodity market for oil, as we know it today, did not exist. 

Although U.S. oil production has increased dramatically in recent years, the global oil market is 

the largest commodity market in the world, making consumers subject to global commodity price 

fluctuations. 

1 
40 


The original l970s-cra goal of EPCA focused on avoiding "national energy supply shortages." 

A loss of supply to U.S. refineries is no longer the singular focus of the SPR. Because the 

United States is linked to the global market, it is exposed to global price fluctuations. When 

global oil prices spike, U.S. oil prices spike. Regardless of U.S. oil import levels, a severe global 

oil supply disruption today would impact domestic petroleum product prices. Past oil price 

fluctuations have been followed by multiple quarters of weak world-wide economic growth. 

This focus on price was codified in the EPCA amendments of 1990, which added price impacts 

to the criteria for an SPR drawdown. 

In the event of a serious international oil supply disruption, commercial stocks and global spare 

production capacity could provide some relief for lost output, but cannot provide assured 

additional supply. Offsetting disrupted supplies with SPR oil, in concert with other countries 

that hold strategic oil stocks, can help reduce an increase in international oil prices and the 

resulting adverse economic impacts that could otherwise occur. 

SPR Organization. Assets and Capabilities 

The SPR operates under the leadership and direction of the Deputy Assistant Secretary for the 

Office of Petroleum Reserves, a Program Office within the Department of Energy's (DOE) 

Office of Fossil Energy. The Headquarters Program Office maintains responsibility for program 

management of the SPR, providing oversight of the SPR program, including major engineering 

projects; environmental, safety, security, and occupational health issues; oil distribution planning 

and analysis; budgeting and financial management; and the drawdown and operations of the 

SPR. The Program Office also conducts strategic planning, policy analysis, and major program 

studies, and engages with domestic and international stakeholders. 

The SPR Project Management Office, located in New Orleans, Louisiana is responsible for the 

operation and management of all SPR field activities, as well as oversight of the Department's 

Management and Operating (M & 0) Contractor, who performs the day-to-day operations and 

maintenance activities of the SPR's crude oil storage sites. 

The Department operates and maintains four major oil storage sites in the Gulf Coast region: the 

Bryan Mound and Big Hill sites in Freeport, Texas and Winnie, Texas, and the West Hackberry 

and Bayou Choctaw sites in Hackberry, Louisiana and Plaquemine, Louisiana, respectively. 

These sites are located in close proximity to Gulf Coast refineries and midstream infrastructure. 

The SPR's crude oil inventory of671.7 million barrels (as of October 13, 2017) consists ofboth 

sweet and sour crude oil available for release in the event of an oil supply disruption. The crude 

oil is stored across the four sites in 60 underground caverns with a total design capacity of713.5 

million barrels and 115 operational wellbores. The SPR is designed to provide the capability to 

draw down and deliver crude oil from the storage sites to designated distribution points, with 

additional access to commercial pipeline networks and marine terminals, at a design drawdown 

rate of 4.415 million barrels per day. Each site is capable of drawing down and delivering crude 

2 
41 


oil to the designated distribution points until 90% of the inventory is depleted. SPR operating 

costs are less than $0.25 per barrel of design storage capacity per year, the lowest reported cost 

among oil stockpiling countries. 

U.S. International Energy Program Obligations 

One of the SPR's core missions is to carry out U.S. obligations under the (IEP), the 1974 treaty 

that established the International Energy Administration (lEA). Under the Coordinated 

Emergency Response Mechanism, adopted in 1984, selling oil into the market (rather than 

exchanging the oil withdrawn from stocks among members) became the preferred approach to 

address oil supply disruptions. The lEA monitors the world oil market and, in the event of a 

global oil supply crisis, calls for the release of strategic oil stocks. 

As a member of the lEA, the United States has two primary obligations: 

1. As a net oil importer, the United States must maintain crude oil and/or refined product stock 

inventories, whether held by industry or government, equal to at least 90 days of net petroleum 

imports. Of the 29 lEA member countries, 25 other net importers have the same obligation. The 

remaining three members do not have a stockholding obligation because they are net oil 

exporters. As of June 30, 20 I 7 the U.S. held 149 days of net petroleum imports, based on an 

SPR crude oil inventory of 678.9 million barrels and 2016 net import figures. 

2. The United States must be able to contribute a proportionate share to an lEA collective action 

response based on its share of lEA oil consumption. This obligation can be met by any measure a 

member nation may choose, including release of strategic or commercial stocks. As of June 30, 

2017, the United States must be prepared to contribute 43.2% of the barrels released in an lEA 

collective action response. The United States government relics on the use of the SPR to meet 

this requirement, although commercial stocks may also contribute voluntarily. 

It is also important to note that U.S. domestic conventional and unconventional production alone 

would not be able to ramp up quickly enough to make up for the lost barrels in a crisis. The SPR 

can physically begin to drawdown its stored crude oil in as little as two days of notification, and 

taking into account the time required to meet all sales process requirements, can be ready to 

drawdown and deliver crude oil within thirteen days of a Presidential Finding. Domestic 

production would take months to expand substantially. 

According to the BP Statistical Review of World Energy 2017, the movement of oil around the 

world grew by nearly I I million barrels per day from 2006 to 2016, and this trend is likely to 

continue. As global oil trade increases, the potential role of the SPR to help mitigate global 

supply disruptions expands, regardless of the level of U.S. net oil imports. The portion ofthis 

traded oil imported by lEA member countries is decreasing as consumption has increased in nonOECD countries. In step with this trend, the ability of lEA stocks to address a crisis will 

3 
42 


become strained. Without the ability to replace disrupted oil supplies on the global market, 

global oil prices could increase significantly, and the U.S. and global economy could be harmed. 

Accordingly, one important way to measure the SPR' s effectiveness is by its ability to address 

the requirements that will arise from a collective action response to a disruption, rather than 

strictly how many days of U.S. oil imports it represents. 

Modernization of SPR Infrastructure 

The infrastructure and equipment to support a drawdown across the SPR is both large and 

complex. In addition to the underground storage caverns and well bores, this infrastructure 

includes 80 pumps for crude oil, raw water, brine, and fire fighting systems; more than 5,400 

valves; 33 heat exchangers; 21 brine disposal wells; 16 above ground storage tanks holding crude 

oil, waste oil, and firefighting water; a crude oil degasification plant; and over 200 miles of crude 

oil, raw water, and brine disposal pipelines that must be maintained. 

SPR infrastructure has performed capably to ensure the SPR has been able to respond to every 

emergency release situation presented throughout the SPR's history. However, SPR facilities are 

aging and a significant amount of infrastructure components are at or beyond their design life. 

The first and only SPR life extension project was conducted in the late 1990s. This project 

addressed essential SPR configuration and system improvements necessary to ensure the ability 

to maximize the SPR's drawdown rate. However, it did not replace many pieces of rotating 

equipment such as pumps and motors, and did not completely address some other SPR 

infrastructure elements. Further, nine consecutive years of crude oil sales from the SPR 

(beginning in FY2017) utilizing equipment beyond its design life increases the risk of additional 

equipment failures that could potentially impact the ability to conduct these sales in the 

statutorily-mandated timeframes. 

Congress, recognizing the importance of the SPR as a valuable national energy security asset, 

established an Energy Security and Infrastructure Modernization (ESIM) Fund in Section 404 of 

the Bipartisan Budget Act of 2015 (Public Law 114-74) for the purpose of providing for the 

construction, maintenance, repair, and replacement of SPR facilities. In establishing the ESJM 

Fund, Congress made the following findings: 

I. The SPR is one of the nation's most valuable energy security assets; 

2. The age and condition of the SPR have diminished its value as a Federal energy security asset; 

3. Global oil markets and the location and amount of U.S. oil production and refining capacity 

have dramatically changed in the 40 years since the establishment of the SPR; and 

4. Maximizing the energy security value of the SPR requires a modernized infrastructure that 

meets the drawdown and distribution needs of changed domestic and international oil and 

refining market conditions. 

4 
43 


Section 404 also directed the Secretary of Energy (the Secretary) to establish an SPR 

modernization program to protect the U.S. economy from the impacts of emergency supply 

disruptions. This program may include: 

I. Operational improvements to extend the useful life of surface and subsurface infrastructure; 

2. Maintenance of cavern storage integrity; and 

3. Addition of infrastructure and facilities to optimize the drawdown and incremental distribution 

capability of the SPR .. 

Section 404 also authorized the Secretary to draw down and sell crude oil from the SPR in the 

amount of $2 billion, over the four year period encompassing fiscal years 2017 through 2020, for 

the purpose of carrying out an SPR modernization program. In response, the SPR has initiated a 

major capital asset acquisition project known as Life Extension Phase II (LE2). The purpose of 

this project is to modernize aging SPR infrastructure through systems upgrades and associated 

equipment replacement to ensure that the SPR can meet mission requirements for the next 

several decades. Affected SPR infrastructure that will be addressed by this project include crude 

oil transfer systems; raw water systems; brine disposal systems; power distribution and lighting 

systems; physical security systems; fire fighting systems; a new crude oil processing 

(degasification) plant; and auxiliary systems and facilities. An initial analysis of alternatives to 

consider work activity packages for this project was completed in December 2016, and a 

supplemental analysis of alternatives to refine the initial work activity packages selected was 

completed in June 2017, leading to the commencement of project design work in August 2017 

and procurement of long lead-time equipment in September 2017. This project has a current 

estimated cost range of $750 million- $1.4 billion with a current estimated completion date 

range between fiscal year's FY2022 and FY2024. 

Congressionally-Mandated Crude Oil Sales 

As mentioned above, beginning in FY2017, the SPR began nine consecutive years of mandatory 

sales, referred to as the "decade of drawdowns". In 2015 and 2016, three separate laws were 

enacted that mandate the Secretary of Energy to sell 149 million barrels of crude oil, with the 

proceeds to be deposited in the general fund of the Treasury. 

1. Section 403 of the Bipartisan Budget Act of20 15 (Public Law 114-74) mandates the sale of 

58 million barrels between FY2018 and FY2025 for federal government deficit reduction; 

2. The Fixing America's Surface Transportation (FAST) Act (Public Law 114-94) mandates the 

sale of 66 million barrels between FY2023 and FY2025 for funding offsets to finance 

transportation infrastructure; and 

5 
44 


3. The 21st Century Cures Act (Public Law 114-255) mandates the sale of25 million barrels 

between FY2017 and FY20 19 for funding offsets to finance medical initiatives. 

Hurricane Harvey Emergency Response Efforts 

Hurricane Harvey made landfall as a major hurricane on August 25, 2017 just north of Corpus 

Christi, Texas. Harvey's path eventually impacted U.S. Gulf Coast crude oil infrastructure as a 

hurricane and as a tropical storm from Corpus Christi, Texas to Lake Charles, Louisiana from 

August 25 through August 30. During this period, 20 refineries in this area were impacted 

(seventeen closing, and three running at reduced operations for limited periods) comprising over 

5.6 million barrels of crude oil processing capacity. In addition, nine major ports in the area 

were closed, and the major east-west crude oil pipeline between Houston, Texas and Houma, 

Louisiana was not operating. Many of the impacted refineries were operable following the 

passage of Harvey but, in some cases, were unable to secure crude oil feedstock to re-commence 

or continue operations. As a result, the SPR received a total of eight requests for emergency 

exchanges of crude oil from six companies- one request submitted just prior to the hurricane's 

landfall was denied, since SPR personnel had been evacuated as a safety precaution and the 

requested SPR site was not available for drawdown; and one request was withdrawn shortly after 

submission due to availability of an alternate supply source. Evaluation of the remaining 6 

requests commenced immediately upon receipt of the requests. 

After assessing prevailing supply conditions and consulting with other Federal agencies 

regarding the status of ports and other supply infrastructure, the SPR received approval from the 

Secretary to execute six emergency exchange agreements with four companies. The first 

deliveries of crude oil were provided on August 30, just two days after the request was received. 

Deliveries to the remaining companies also commenced within days after the initial requests 

were received and continued until all deliveries totaling five million barrels of SPR crude oil 

were completed on September 28. These emergency exchanges helped alleviate the loss of crude 

oil supply, allowing the affected companies to begin and/or continue refinery operations that 

otherwise would have been halted as a result of the impacts from Hurricane Harvey. Repayment 

of these crude oil loans recently commenced and are anticipated to conclude in March 2018. 

Conclusion 

In conclusion, I want to thank you for the opportunity to speak with you today about the SPR and 

its operational challenges. I look forward to answering any of your questions. 

6 
45 

Mr. UPTON. Thank you very much. 

Lastly, on the first panel we are joined by Frank Rusco, Director 

of the Natural Resources and Environment from the GAO. Welcome. 

STATEMENT OF FRANK RUSCO 

Mr. RUSCO. Chairman Upton, Ranking Member Rush, and members of the subcommittee, thank you for the opportunity to discuss 

our past and ongoing work on energy resilience and particularly 

the effectiveness of the Strategic Petroleum Reserve in responding 

to domestic petroleum supply disruptions caused by extreme 

weather and other events. 

The SPR was created at a time when global oil supply was dominated by OPEC and oil markets were characterized by long-term 

contracts with fixed prices. At that time a global oil supply disruption, as occurred during the Arab oil embargo, had the effect of 

physical oil shortages and in the United States and elsewhere long 

lines at the gas pump. It made sense at the time for the SPR to 

be comprised of crude oil centrally held in cheap salt dome storage 

in Louisiana and Texas, near the Nation’s largest refining centers. 

Today global oil markets are robust, and prices change to accommodate supply and demand, so that physical shortages and long 

lines are less of an issue. In addition, the use of the SPR has been 

primarily in response to domestic supply disruptions, particularly 

those caused by extreme weather events, rather than global supply 

shortages. My remarks will focus on how well the SPR is able to 

respond to these domestic supply disruptions. 

The SPR has been partially successful in responding to domestic 

supply disruptions in instances when Gulf Coast refineries and 

pipelines are operational but crude oil supplies to these refineries 

have been disrupted. For example, this year following Hurricane 

Harvey the SPR was able to supply several refineries with crude 

oil by pipeline while shipping ports were closed. 

However, the SPR has been less effective in responding to reductions in petroleum products in the rest of the country, as has occurred multiple times when hurricanes have shut down refineries 

or shut down power to other petroleum infrastructure. In this latter cases, including following Hurricane Harvey when as much as 

34 percent of the Gulf Coast refining capacity was shut in, the real 

supply problem was gasoline, diesel, and jet fuel, and the SPR has 

only a small reserve of gasoline in the Northeast and no other petroleum product reserves. As a result, the SPR cannot provide 

needed petroleum products to Florida, the Eastern Seaboard, and 

other regions typically supplied by Gulf Coast refiners. 

DOE has recognize the desirability of having regional reserves of 

petroleum products. For example, in 2014, DOE identified five regions that are vulnerable to petroleum product supply disruptions. 

These include the West Coast, which is vulnerable to earthquakes 

and tsunamis, parts of six Midwestern States vulnerable to earthquakes, a number of States vulnerable to extreme cold weather, 

and the entire coast from Texas up to Massachusetts that is vulnerable to hurricanes. 

With the exception of the small gasoline reserves held in the 

Northeast, there are no other petroleum product reserves held by 

46 

the SPR in any of these vulnerable regions. Further, while DOE 

has recognized these vulnerabilities and conducted some studies of 

alternatives to the current composition and configuration of strategic reserves, it has not completed these studies. As a result, DOE 

cannot determine the efficacy of creating regional petroleum product reserves. 

In contrast to how the SPR is configured, most other countries 

with strategic reserves have chosen to hold significant quantities of 

petroleum products in addition to crude oil, and some have chosen 

to spread these reserves out across their countries to be closer to 

centers of demand. For example, Germany chooses to hold about 55 

percent of its strategic stocks as petroleum products. France 

spreads its reserves across seven geographic zones that enable it to 

distribute petroleum products to distribution networks all over the 

country. 

The United States has benefitted from European strategic stocks 

of petroleum products during past hurricane damage to Gulf Coast 

refining and production infrastructure. For example, in response to 

Hurricane Katrina in 2005, as prices of gasoline rose across the 

United States, shipments of gasoline from Europe began arriving 

on the East Coast within days. This mitigated the economic effects 

of the hurricane-caused refinery and oil production shutdowns. 

As DOE undertakes a modernization program of its existing systems, this committee and others have requested that we undertake 

an evaluation of the SPR, its size, composition, location of reserves, 

and options for improving its effectiveness. We will report our findings in the next few months. 

Thank you. This concludes my oral remarks. I will be happy to 

answer any questions you may have. 

[The prepared statement of Mr. Rusco follows:] 

47 


For Release on Delivery 

Expected at 10:00 a.m. EST 

Thursday, November 2, 2017 

GA0-18-209T 

United States Government Accountability Office 

Testimony 

Before the Subcommittee on Energy, 

Committee on Energy and Commerce, 

House of Representatives 

STRATEGIC 

PETROLEUM RESERVE 

Preliminary Observations 

on the Emergency 

Oil Stockpile 

Statement of Frank Rusco, Director, 

Natural Resources and Environment 
48 


Chairman Upton, Ranking Member Rush, and Members of the 

Subcommittee: 

I am pleased to be here today to discuss our work on energy resilience, 

specifically preliminary observations from our ongoing work looking at the 

Strategic Petroleum Reserve (SPR)-the world's largest government 

owned stockpile of emergency oil. U.S. energy systems are vulnerable to 

a range of potential disruptions, including from international events, such 

as conflicts or terrorism incidents that may affect oil supplies, and 

domestic ones, such as from hurricanes and other severe weather 

events, which can disrupt oil and gas supplies and cause temporary fuel 

or electricity shortages. Because of the central role that energy plays in 

the U.S. economy and the configuration of the nation's energy system, 

vulnerabilities may have wide-ranging implications for energy production 

and use, ultimately affecting transportation, industrial, agricultural, and 

other critical sectors of the economy that require reliable energy. We have 

reported on energy vulnerabilities as well as on federal efforts to address 

them. 1 Recent experience with hurricanes Harvey, Irma, and Maria 

underscores these vulnerabilities. In addition to damaging infrastructure 

and property, and causing the loss of life, the hurricanes disrupted the 

operations of refineries representing at least 15 percent of the nation's 

refining capacity, affected fuel distribution, and left millions of U.S. 

citizens without electricity. 

After the Arab oil embargo, over 4 decades ago, Congress authorized the 

creation of the SPR to include the ability to release oil to the market 

during supply disruptions and protect the U.S. economy from damage. 

The SPR is managed by the Department of Energy (DOE). The SPR held 

673.7 million barrels of oil as of September 30, 2017 which is worth about 

$38.4 billion at prices as of October 30, 20172 According to DOE's 2014-

1

For example. in January 2017, we reported on federal grid resiliency efforts, finding that 

such efforts were fragmented across the Department of Energy, Department of Homeland 

Security, and the Federal Energy Regulatory Commission, and that these efforts 

overlapped to some degree, but were not duplicative. GAO, Electricity: Federal Efforts to 

Enhance Grid Resilience, GA0~17-153 (Washington, D.C.: Jan. 25, 2017). !n January 

2014, we found that U.S. energy infrastructure may be affected throughout all major 

stages of the energy supply chain, increasing the risk of disruptions. GAO, Climate 

Change: Energy Infrastructure Risks and Adaptation Efforts, GA0~14~74 (Washington, 

DC.: Jan. 31, 2014) 

2This calculation is based on average market oil prices as of October 30, 2017, in part, 

referenced from the West Texas Intermediate which is a domestic oll used as a 

benchmark for pricing 

Page 1 GA0~18·209T Strategic Petroleum Reserve 
49 


2018 strategic plan, the SPR benefits the nation by providing an 

insurance policy against actual and potential interruptions in petroleum 

supplies caused by international turmoil, hurricanes, accidents, or terrorist 

activities.' Releasing SPR oil during a disruption is intended to mitigate 

damage to the economy by replacing disrupted oil supplies, thereby 

reducing price increases that can result in economic damage. When 

processed, oil is converted into refined petroleum products such as 

gasoline and diesel fuel. 

The SPR also helps the United States meet its stockholding obligations 

as a member of the International Energy Agency (IEA)-an international 

energy forum of 29 member nations established in 1974 to help members 

respond to major oil supply disruptions. 4 lEA members have agreed to 

fulfill obligations, including holding reserves of oil or refined petroleum 

products equaling 90 days of net petroleum imports, and to release these 

reserves, utilize demand restraint measures, increase surge production, 

or utilize fuel switching during an lEA collective action in response to oil 

supply disruptions. In September 2014, we found that changes including 

increasing oil production, shrinking oil imports, and changing oil and fuel 

distribution patterns have important implications for the SPR. 5 In that 

report, we concluded that changing market conditions have implications 

for the size, location, and composition of the SPR, and recommended that 

the Secretary of Energy undertake a comprehensive reexamination of the 

appropriate size of the SPR. In addition, in 2015, Congress required the 

Secretary of Energy to complete a long-range strategic review of the 

SPR6 DOE completed its review in August 2016 which reviewed the size, 

3U.S. Department of Energy, US. Department of Energy Strategic Plan 2014-2018, March 

2014. 

4The United States and 28 other Organisation for Economic Co-operation and 

Development countries are members of the !EA. The 29 member countries are Australia, 

Austria, Belgium, Canada, Czech Republic, Denmark, Estonia, Finland, France, Germany, 

Greece, Hungary, Ireland, Italy, Japan, Republic of Korea, Luxembourg, The Netherlands, 

New Zealand, Norway. Poland, Portugal, Slovak Republic, Spain. Sweden, Switzerland, 

Turkey, United Kingdom, and United States, 

5GAO, Changing Crude Oil Markets: Alfowing Exports Could Reduce Consumer Fuel 

Prices, and the Size of the Strategic Reserves Should Be Reexamined, GA0-14-807 

(Washington, D.C.: Sept 30. 2014). 

6Bipartisan Budget Act of 2015, Pub. L. No. 114-74, § 402, 129 Stat 584, 589(2015). 

Page 2 GA0-18-209T Strategic Petroleum Reserve 
50 


composition, infrastructure needs, and distribution capability of the 

reserve. 7 

My statement today is based primarily on preliminary observations from 

ongoing work and focuses on (1) how DOE has used the SPR to address 

domestic petroleum supply disruptions; (2) the extent to which the SPR is 

able to respond to domestic petroleum supply disruptions; and (3) how 

other lEA members have structured their strategic reserves and the 

extent to which DOE has evaluated these structures. 

As part of our ongoing work, we reviewed reports and studies, including 

by DOE, lEA, and the U.S. Energy Information Administration (EIA) 8 and 

interviewed DOE and lEA officials. Specifically, to describe how DOE has 

used the SPR to address domestic petroleum supply disruptions, we 

reviewed DOE, lEA, and EIA documents. To examine the extent to which 

the SPR is able to respond to domestic petroleum supply disruptions, we 

reviewed documents and reports from DOE, lEA, and DOE's Inspector 

General and interviewed DOE officials. We also reviewed our past work 

from August 2006 through September 2014. 9 To describe how other lEA 

members have structured their strategic reserve systems to respond to 

disruptions, we reviewed lEA documents on members' reserve systems, 

reviewed a French document on its reserve system, and interviewed lEA 

officials about these systems. To describe the extent to which DOE has 

evaluated these structured, we reviewed DOE documents and 

7U S. Department of Energy, Long-Term Strategic Review of the U.S. Strategic Petroleum 

Reserve: Report to Congress, (Washington, D.C.: Aug. 2016). 

8E!A is a statistical agency within DOE that collects, analyzes, and disseminates 

independent information on energy issues 

9See. GAO, Strategic Petroleum Reserve: Available Oil Can Provide Significant Benefits, 

but Many Factors Should Influence Future Decisions about Fill, Use, and Expansion, 

GA0-06-872 (Washington. D.C. Aug. 24, 2006); GAO. Strategic Petroleum Reserve: 

Improving the Cost-Effectiveness of Filling the Reserve, GA0-08-726T (Washington, D.C .. 

Apr. 24, 2008); GAO, Strategic Petroleum Reserve: Issues Regarding the Inclusion of 

Refined Petroleum Products as Part of the Strategic Petroleum Reserve, GA0-09-695T 

(Washington, D.C. May 12, 2009); GA0-14-807. 

9

See: GAO, Strategic Petroleum Reserve: Available Oil Can Provide Significant Benefits, 

but Many Factors Should tnnuence Future Decisions about Fill, Use, and Expansion, 

GA0-06-872 (Washington, D.C .. Aug. 24, 2006); GAO, Strategic Petroleum Reserve· 

Improving the Cost-Effectiveness of Fi!fing the Reserve, GA0-08-726T (Washington, D.C · 

Apr. 24, 2008}; GAO, Strategic Petroleum Reserve: Issues Regarding the Inclusion of 

Refined Petroleum Products as Part of the Strategic Petroleum Reserve, GA0-09-695T 

(Washington, D.C May 12, 2009); GA0-14-807. 

Page 3 GA0-18-209T Strategic Petroleum Reserve 
51 


Background 

Strategic Petroleum 

Reserve 

interviewed DOE officials. We shared the information in this statement 

with DOE, and the agency provided comments. 

We are conducting the work upon which this statement is based in 

accordance with generally accepted government auditing standards. 

Those standards require that we plan and perform the audit to obtain 

sufficient, appropriate evidence to provide a reasonable basis for our 

findings and conclusions based on our audit objectives. We believe that 

the evidence obtained provides a reasonable basis for our findings and 

conclusions based on our audit objectives. 

The Energy Policy and Conservation Act (EPCA) of 1975 authorized the 

SPR, partly in response to the Arab oil embargo of 1973 to 1974 that 

caused a shortfall in the international oil market. 10 The SPR is owned by 

the federal government, managed by DOE's Office of Petroleum 

Reserves, and maintained by Fluor Federal Petroleum Operations LLC." 

The SPR stores oil in underground salt caverns along the Gulf Coast in 

Louisiana and Texas. DOE established an initial target capacity for the 

SPR of 500 million barrels based on U.S. import levels and implemented 

a phased approach to create large underground oil storage sites in salt 

formations, to reach a physical storage capacity of 750 million barrels. 

The SPR currently maintains four storage sites with a physical capacity of 

713.5 million barrels. 

Three recent laws required sales of oil from the SPR to fund its 

modernization and other national priorities. The Bipartisan Budget Act of 

2015 provided for the drawdown and sale of 58 million barrels of oil from 

fiscal years 2018 through 2025 and authorized the sale of up to $2 billion 

worth of oil through fiscal year 2020 to be used for an SPR modernization 

program. 12 The Fixing America's Surface Transportation Act provided for 

the drawdown and sale of 66 million barrels of oil from fiscal years 2023 

10Pub. L No. 94-163, § 154(a), 89 Stat. 871,882 (1975)(codified as amended at42 

U.S.C. § 6234(a). 

11F!uor Federal Petroleum Operations LLC is the current DOE Management and 

Operating Contractor for the SPR 

12Pub. L. No. 114-74, §§ 403, 404, 129 Stat. 584, 589 (2015). 

Page 4 GA0·18·209T Strategic Petroleum Reserve 
52 


Regional Refined Product 

Reserves 

through 2025. 13 The 21st Century Cures Act provided for the drawdown 

and sale of 25 million barrels from fiscal years 2017 through 2019. 14 DOE 

estimates that, as a result of these sales, the SPR will hold between 506 

and 513 million barrels of oil by 2025. For member countries to meet net 

petroleum import obligations, the lEA counts both public and private oil 

reserves, although the United States meets its lEA obligation solely 

through the SPR. 15 As of July 2017, according to lEA data, the SPR held 

the equivalent of 141 days of import protection and U.S. private oil held 

the equivalent of an additional216 days, for a total of about 356 days. 16 

Based on EIA projections of net imports, between 506 and 513 million 

barrels of oil would be equivalent to about 242 and 245 days of net 

imports in 2025." 

The United States has two regional refined product reserves-Northeast 

Home Heating Oil Reserve and Northeast Gasoline Supply Reserve. 

The Northeast Home Heating Oil Reserve, which is not part of the 

SPR, 18 holds 1 million barrels of ultra low sulfur distillate, used for 

heating oil, for homes and businesses in the northeastern United 

States, 19 a region heavily dependent upon the use of heating oil, 

according to DOE's website. The distillate is stored in leased 

13Pub. L. No. 114-94, § 32204, 129 Stat 1311. 1740 (2015) 

14Pub. L. No. 114-255, § 5010, 130 Stat 1033, 1197 (2015). 

15 Public reserves are owned by the government or an independent organization set up by 

the government, known as an agency. Private reserves, also called industry reserves, are 

oil held for commercial and operational purposes as well as oi! held by industry to meet 

minimum national reserve requirements. 

16According to the lEA data source, the total does not equal the sum of industry and 

public reserves due to rounding. 

17This calculation is based on DOE officials' estimated reserve level of SPR in 2025 and 

forecast changes in net imports from the EJA reference case forecast from its Annual 

Energy Outlook 2017. 

18The Energy Act of 2000 authorized the establishment of the Northeast Home Heating Oil 

Reserve, and specifically provided that such a reserve is not a component of the SPR. 

Pub. L. No. 106-469, § 201(a)(3), 114 Stat. 2029, 2034 (2000) (codified as amended at 42 

U.S.C. § 6250(a)). 

19The term Northeast, for purposes of the Northeast Home Heating Oil Reserve, is defined 

as the States of Maine, New Hampshire, Vermont, Massachusetts, Connecticut, Rhode 

Island, New York. Pennsylvania, and New Jersey 42 U.S. C.§ 6250(b)(1) 

Page 5 GA0~18-209T Strategic Petroleum Reserve 
53 


Statutory Release 

Authority for the SPR 

commercial storage in terminals located in three states: Connecticut, 

Massachusetts, and New Jersey. In 2000, President Clinton directed 

the creation of the reserve to hold approximately 10 days of inventory, 

the time required for ships to carry additional heating oil from the Gulf 

of Mexico to New York Harbor"o 

The Northeast Gasoline Supply Reserve, a part of the SPR, holds a 

1 million barrel supply of gasoline for consumers in the northeastern 

United States. According to DOE's website, this region is particularly 

vulnerable to gasoline disruptions as a result of hurricanes and other 

natural events. In response to Superstorm Sandy, which caused 

widespread gasoline shortages in the region in 2012, DOE conducted 

a test sale of the SPR and used a portion of the proceeds from the 

sale to create the reserve in 2014. The gasoline is stored in leased 

commercial storage in terminals located in three states: Maine, 

Massachusetts, and New Jersey. 

Under conditions prescribed by EPCA, as amended, the President has 

discretion to authorize the release of petroleum products from the SPR to 

minimize significant supply disruptions." In the event of an oil supply 

disruption, the SPR can supply the market by selling stored oiL Should 

the President order an emergency sale of SPR oil, DOE conducts a public 

sale, evaluates and selects offers, and awards contracts to the highest 

qualified bidders. Purchasers are responsible for making their own 

arrangements for the transport of the SPR oil to its final destination. The 

Secretary of Energy also is authorized to release petroleum products from 

the SPR through an exchange for the purpose of acquiring oil for the 

SPR. 22 According to DOE officials, this authority is sometimes utilized in 

20!nitially, the Northeast Home Heating Oil Reserve held two million barrels of high sulfur 

heating oil. In 2011, the two million barrels of high sulfur heating oil was sold and 

replaced with one m1llion barrels of ultra low sulfur distillate. 

21 Pub. L No. 94-163, § 161, 89 Stat 871, 888 (1975) (codified as amended at 42 U.S C. 

§ 6241 ). The statute provides for a drawdown of the reserve upon a finding by the 

President that drawdown and sale are required by a "severe energy supply interruption," 

as defined by statute, or obligation under the International energy program. 42 U.S. C.§ 

6241(d). Limited drawdowns may be conducted if the President finds that a circumstance 

is, or is likely to become, a domestic energy supply shortage of significant scope or 

duration, action taken would assist directly and significantly in preventing or reducing the 

adverse impact of such shortage, and the Secretary of Defense has found that action 

taken will not impair national security. 42 U.S.C. § 6241(h). 

22See 42 U.S.C. § 6240(a). 

Page 6 GA0-18-209T Strategic Petroleum Reserve 
54 


Changing Petroleum 

Markets 

oil supply disruptions when a specific volume of SPR oil is provided to a 

private sector company in an emergency exchange for an equal quantity 

of oil plus an additional amount as a premium to be returned to the SPR 

in the future. According to DOE's website, emergency exchanges are 

generally requested by a company after an event outside the control of 

the company, such as a hurricane, disrupts commercial oil supplies. The 

Secretary of Energy is also authorized to carry out test drawdowns 

through a sale or exchange of petroleum products to evaluate SPR's 

drawdown and sales procedures. When oil is released from the SPR, it 

flows through commercial pipelines or on waterborne vessels to 

refineries, where it is converted into gasoline and other petroleum 

products, and then transported to distribution centers for sale to the 

public. 

Petroleum markets have changed substantially in the 40 years since the 

establishment of the SPR, including increases in global markets, 

increases in domestic oil production, and declines in net petroleum 

imports. 

Increases in global markets. At the time of the Arab oil embargo, 

price controls in the United States prevented the prices of oil and 

petroleum products from increasing as much as they otherwise might 

have, contributing to a physical oil shortage that caused long lines at 

gasoline stations throughout the United States. Now that the oil 

market is global, the price of oil is determined in the world market, 

primarily on the basis of supply and demand. In the absence of price 

controls, scarcity is generally expressed in the form of higher prices, 

as purchasers are free to bid as high as they want to secure oil 

supply. In a global market, an oil supply disruption anywhere in the 

world raises prices everywhere. Releasing oil reserves during a 

disruption provides a global benefit by reducing oil prices in the world 

market. 

Increases in domestic oil production. Reversing a decades-long 

decline, U.S. oil production has generally increased in recent years. 

According to EIA data, U.S. production of oil reached its highest level 

in 1970 and generally declined through 2008, reaching a level of 

almost one-half of its peak. During this time, the United States 

increasingly relied on imported oil to meet growing domestic energy 

needs. However, recent improvements in technologies have allowed 

producers to extract oil from shale formations that were previously 

considered to be inaccessible because traditional techniques did not 

yield sufficient amounts for economically viable production. In 

Page7 GA0·18·209T Strategic Petroleum Reserve 
55 


particular, the application of horizontal drilling techniques and 

hydraulic fracturing-a process that injects a combination of water, 

sand, and chemical additives under high pressure to create and 

maintain fractures in underground rock formations that allow oil and 

natural gas to flow-have increased U.S. oil and natural gas 

production. 

Declines in net petroleum imports. One measure of the economy's 

vulnerability to oil supply disruptions is to assess net petroleum 

imports-that is, imports minus exports. Net petroleum imports have 

declined by over 60 percent from a peak of about 12.5 million barrels 

per day in 2005 to about 4.8 million barrels per day in 2016. In 2006, 

net imports were expected to increase in the future, increasing the 

country's reliance on foreign oiL However, imports have declined 

since then and, according to EIA's most recent forecast, are expected 

to remain well below 2005 import levels into the future. Canada and 

Mexico are the nation's major foreign sources for imported oiL 

Furthermore, the United States has increased its exports of oil and 

refined petroleum products. 

Page 8 GA0~18-209T Strategic Petroleum ReseiVe 
56 


DOE Has Primarily 

Used Exchanges 

from the SPR to 

Private Companies to 

Address Domestic 

Petroleum 

Disruptions 

To quantify how DOE has used the SPR to address domestic petroleum 

supply disruptions, we reviewed DOE and EIA documents. We also 

reviewed our past work from August 2006 to January 2014. 

Our preliminary analysis indicates that DOE has primarily used 

exchanges to private companies in response to domestic supply 

disruptions such as hurricanes and other events. DOE has released oil 24 

times from 1985 through September 2017, including 11 releases in 

response to domestic supply disruptions. 23 Of these 11 releases, 10 were 

exchanges, including 6 exchanges in response to hurricanes. One of the 

11 releases was an SPR sale in response to Hurricane Katrina, which 

was part of an lEA coordinated action release. Historic releases from the 

SPR are shown in figure 1. 

23 The remaining 13 releases were conducted in response to international disruptions, or 

for budget deficit reduction, test sales to assess SPR operations, and other SPR 

operational needs_ DOE officials stated that two additional releases were under way as of 

October 2017, that are not included in this 24 release total-those required in fiscal year 

2018 under the Bipartisan Budget Act and the 21st Century Cures Act As those sales are 

in process and yet not complete, GAO did not include them in its total of 24 releases. 

Page 9 GA0-18-209T Strategic Petroleum Reserve 
57 


Figure 1: Preliminary Analysis of Historical Strategic Petroleum Reserve Releases 

MI!Hon barNl& 

30 

25 

20 

,. 

10 

bData for 2017 are through September 

Our preliminary analysis also indicates that the six exchanges from DOE 

to U.S. refineries in response to hurricanes totaled about 28 million 

barrels. 

Based on our preliminary analysis of DOE documents, most recently, 

in response to Hurricane Harvey in 2017, DOE exchanged 5 million 

barrels of oil to Gulf Coast refineries that requested supplies. Refinery 

operations largely depend on a supply of oil and feedstocks. 

Hurricane Harvey closed or restricted ports through which 2 million 

barrels of oil per day were imported, and several refineries had no 

supply options except for SPR oil. According to DOE officials, 

exchanges from the SPR have allowed refineries to continue to 

Page 10 GA0~18-209T Strategic Petroleum Reserve 
58 


The SPR Is Limited in 

Its Ability to Respond 

to Domestic 

Disruptions 

operate until alternative supply sources became available, ensuring 

continued production of refined petroleum products for use by 

consumers. 

Based on our preliminary analysis of DOE documents, DOE's most 

significant response to a hurricane was in 2005 following Hurricane 

Katrina. As we reported in January 2014, oil platforms were 

evacuated and damaged, virtually shutting down all oil production in 

the Gulf region as a result of the hurricane. 24 Based on our 

preliminary analysis of DOE documents, exchanges from the SPR, 

totaling 9.8 million barrels of oil, helped refineries offset this short-term 

physical supply disruption at the beginning of the supply chain, 

thereby helping to moderate the impact of the production shutdown on 

U.S. oil supplies. In addition to these exchanges, DOE also 

participated in an lEA collective action that was called in response to 

Hurricane Katrina by selling 11 million barrels of oil from the SPR, and 

lEA member countries delivered and sold much needed gasoline and 

other products to the United States. In total, DOE sold or exchanged 

20.8 million barrels of oil from the SPR. 

Our preliminary analysis of DOE documents and reports also showed that 

although almost all of DOE's releases in response to domestic supply 

disruptions have been from the SPR, DOE also used the Northeast Home 

Heating Oil Reserve in response to Superstorm Sandy in 2012. According 

to DOE's website, the agency transferred approximately 120,000 barrels 

of fuel to the Department of Defense to help provide fuel for first 

responders. 

Based on our past work and preliminary observations, the SPR is limited 

in its ability to respond to domestic petroleum supply disruptions for three 

main reasons. First, as we reported in September 2014, reserves are 

almost entirely composed of oil and not refined products, which may not 

be effective in responding to all disruptions that affect the refining 

sector. 25 Second, as we reported in September 2014, reserves are nearly 

entirely located in one region, the Gulf Coast, which may limit 

responsiveness to disruptions in other regions. Third, during the course of 

our ongoing work, we reviewed DOE and energy task force reports that 

24GA0-14-74 

25GA0-14-807. 

Page 11 GA0~18~209T Strategic Petroleum Reserve 
59 


found that the statutory authorities governing SPR releases may inhibit 

their use for regional disruptions. 

Composition: As we reported in September 2014, the SPR is almost 

entirely composed of oil, which may not be effective in responding to 

all disruptions that affect the refining sector. In September 2014, we 

reported that many recent economic risks associated with supply 

disruptions have originated from the refining and distribution sectors, 

which provide refined products, such as gasoline, rather than from 

shortages of oil. 26 Oil reserves are of limited use in such instances. 

We reported in May 2009 that following hurricanes Katrina and Rita, 

nearly 30 percent of U.S. refining capacity was shut down for weeks, 

disrupting supplies of gasoline and other products. 27 The SPR could 

not mitigate the effects of disrupted supplies because it holds oil. As 

of September 2017, over 99 percent of the SPR and its Northeast 

Gasoline Supply Reserve component (about 674 of 675 million 

barrels) is held as oil rather than as refined products, such as gasoline 

and diesel. Moreover, Gulf Coast hurricanes severely impacted 

refinery operations, such as Hurricane Katrina in 2005, Hurricane Ike 

and Hurricane Gustav in 2008, and Hurricane Harvey this year. 

According to DOE officials, oil reserves are not able to mitigate the 

potential effects of large-scale Gulf Coast refinery outages that may 

impact refined product deliveries. 

Location: As we reported in September 2014, the SPR is nearly 

entirely located in one region, the Gulf Coast, which may limit its 

ability to respond to disruptions in other regions. 28 In the Gulf Coast, 

the SPR is located close to a major refining center as well as to 

distribution points for tankers, barges, and pipelines that can carry oil 

from it to refineries in other regions of the country. Most of the system 

of oil pipelines in the United States was constructed in the 1950s, 

1960s, and 1970s to accommodate the needs of the refining sector 

and demand centers at the time. Given the SPR's current location in 

the Gulf Coast, transporting oil from the reserve may impact 

commercial distribution of oil. Based on our ongoing work, according 

to DOE's 2016 long-term strategic review of the SPR, the agency 

reported that the expanding North American oil production and the 

resulting shifts in how oil is transported around the country have 

26GA0-14-807 

27GA0-09-695T. 

28GA0-14-807. 

Page 12 GA0-18-209T Strategic Petroleum Reserve 
60 


reduced the SPR's ability to add incremental barrels of oil to the 

market under certain scenarios in the event of an oil supply crisis. 

This means that while the SPR remains connected to physical assets 

that could bring oil to the market, in many cases, forcing SPR oil into 

the distribution system would result in an offsetting reduction in 

domestic commercial oil flows. As we reported in September 2014, it 

may be more difficult to move oil from the SPR to refineries in certain 

regions of the United States. For example, since no pipelines connect 

the SPR to the West Coast, supplies of petroleum products and oil 

must be shipped by pipeline, truck, or barge from other domestic 

regions or by tanker from foreign countries. Such modes of transport 

are slower and more costly than via pipelines. For example, it can 

take about 2 weeks for a vessel to travel from the Gulf Coast to Los 

Angeles-including transit time through the Panama Canal. 

Statutory release authorities: In the course of our ongoing work, we 

reviewed DOE and energy task force reports that found that the 

statutory authorities governing SPR releases may inhibit their use for 

regional disruptions. DOE is authorized to release petroleum distillate 

(fuel) from the Northeast Home Heating Oil Reserve upon a finding by 

the President of a severe energy supply interruption that includes a 

dislocation in the heating oil market or other regional supply 

shortage." On the other hand, because the Northeast Gasoline 

Supply Reserve is a part of the SPR, DOE can release gasoline from 

that reserve only after the President makes the statutorily required 

findings for release from the SPR, which do not explicitly include the 

existence of a regional supply shortage. 30 According to DOE's 2016 

long-term strategic review of the SPR, a regional product reserve is 

meant to address regional supply shortages, whereas the SPR of 

which the Northeast Gasoline Supply Reserve is a part of, is meant to 

2942 U.S.C. § 6250b(a). For purposes of the Northeast Home Heating Oil Reserve, a 

"dislocation in the heating oil market" can be deemed to occur only when the price 

differential between crude oH and heating ml, according to specified metrics, increases by 

more than 60 percent over its 5-year rolling average, the differential continues for 7 

consecutive days, and the differential continues to increase thereafter. 42 U.S. C. § 

6250b{b)_ The President can also find a severe energy supply interruption if there is a 

circumstance other than a dislocation in the heating oil market that constitutes a regional 

supply shortage of signif1cant scope and duration and a release would assist directly and 

significantly in reducing the adverse impact of such shortage. 42 U.S. C.§ 6250b(a)(2). 

3042 U.S. C.§ 6241(d), (h). According to DOE's long~term strategic review of the SPR, the 

purpose of the Northeast Gasoline Supply Reserve is to address regional supply 

shortages that can stem from localized natural disasters, such as severe winter weather or 

l:!urricanes Impacting the Northeast, or from other incidents that may Impact regional fuel 

supplies. 

Page 13 GA0~18~209T Strategic Petroleum Reserve 
61 


address severe energy supply interruptions that have a national 

impact. As a result, according to DOE's 2016 long-term strategic 

review of the SPR, in practice, this means that the release of the 

gasoline reserve would have to have a national impact. The 

Quadrennial Energy Review of 2015 recommended that Congress 

integrate the authorities of the President to release products from the 

regional product reserves-the Northeast Home Heating Oil Reserve 

and Northeast Gasoline Supply Reserve-into a single, unified 

authority by amending the trigger for the release of fuel from the two 

refined product reserves so that they are aligned and properly suited 

to the purpose of a product reserve, as opposed to an oil reserve. 31 

As discussed, based on our preliminary observations, DOE has used the 

SPR in response to domestic supply disruptions, but the effectiveness of 

these releases is unclear because DOE has not formally assessed all of 

them. DOE has exchanged about 28 million barrels of oil in response to 

hurricanes, but we found only two reports assessing DOE's response to 

hurricanes Gustav, Ike, Katrina, and Rita, and it is unclear whether DOE 

has examined other responses. According to a 2006 DOE Inspector 

General report, DOE used the SPR and its assets with great 

effectiveness to address emergency energy needs in the crises 

surrounding hurricanes Katrina and Rita, 32 but the concentration of SPR 

sites along the Gulf Coast meant the United States also had to rely on 

refined petroleum products from Europe. The report noted that despite 

being in the path of the hurricanes' destruction, the SPR promptly fulfilled 

requests for oil from refineries suffering from storm-related supply 

31U.S. Department of Energy, Quadrennial Energy Review· Energy Transmission, 

Storage, and Distribution Infrastructure, April 2015. In a presidential memorandum 

released on January 9, 2014, the President created a Quadrennial Energy Review task 

force. The memorandum directed the task force to conduct a Quadrennial Energy Review 

and identified the challenges facing the nation's energy infrastructures as the focus of its 

first installment. The 2015 review recommended updating the SPR's release authority to 

reflect modern markets. Under the statute governing the SPR's release authority, while a 

limited drawdown can be ordered in anticipation of price increases, a full drawdown of the 

reserve cannot be ordered until a supply interruption has, among other things, resulted in 

a severe increase in the price of petroleum products_ 42 U.S.C. § 6241(d), (h}. The 2015 

review also recommended that the authority to anticipate an economy~damaging price 

increase as a result of a severe energy supply interruption should be added to the broader 

EPCA drawdown authonty to more closely conform to other EPCA goals of preventing "a 

severe increase in the price of petroleum products" that "is likely to cause an adverse 

impact on the national economy.» 

32U.S. Department of Energy, Office of Inspector General, The Department of Energy's 

Use of the Strategic Petroleum Reserve in Response to Hurricanes Katn"na and RitaAudit Report, DOE/IG-0747. (Washington, D.C.: Dec. 2006) 

Page 14 GA0·18-209T Strategic Petroleum Reserve 
62 


shortages. However, the damage caused by Hurricane Katrina 

demonstrated that the concentration of refineries on the Gulf Coast and 

resulting damage to pipelines left the United States to rely on imports of 

refined petroleum products from Europe, as part of an lEA collective 

response. Consequently, regions experienced a shortage of gasoline, and 

prices rose. DOE testified in 2009 that despite a response from the SPR 

and lEA, some markets south of Virginia and north of Florida could not be 

immediately supplied with refined products due to a lack of infrastructure 

to receive and distribute imports from the Atlantic coast to inland 

population centers. 33 Exchanges with multiple refiners totaling 5.4 million 

barrels of SPR oil were authorized to hurricanes Gustav and Ike in 2008. 

DOE assessed this response and submitted a report to Congress in 

2009. 34 According to DOE's 2009 report, the exchanges conducted in 

September and October 2008 were successful in providing emergency 

petroleum supplies to refiners experiencing shortages caused by 

hurricanes Gustav and Ike. 

As we reported in May 2009, as originally enacted, EPCA envisioned the 

possibility that the SPR would include a variety of petroleum products 

stored at locations across the country."ln a 2009 hearing, the then 

Deputy Assistant Secretary for Petroleum Reserves testified that DOE still 

considers a large SPR focused on oil storage to be the best way to 

protect the nation from the negative impacts of a short-term international 

interruption to U.S. oil imports; however, the hurricanes of 2005 and 2008 

showed that the SPR may be limited in its ability to address some short33U.S. Department of Energy, David F. Johnson, Deputy Assistant Secretary for 

Petroleum Reserves, Developing Refined Products Storage in the Strategic Petroleum 

Reserve, testimony before the Committee on Energy and Natural Resources, United 

States Senate, May 12, 2009, accessed October 4, 2017. 

https:l/energy.govlfe/articles/developing~refined-products-storage-strategic-petroleumreserve. 

34U.S. Department of Energy, Report to the Congress on the Strategic Petroleum Reserve 

2008 Emergency Test Exchanges, (Washington, D.C .. Aug 2009). 

35GA0-09-695T. 

Page 15 GA0-18-209T Strategic Petroleum Reserve 
63 


Other lEA Members 

Structure Their 

Reserves Differently, 

with Some Holding 

Industry Reserves 

and Refined 

Products, and DOE 

Has Taken Steps to 

Explore These 

Structures 

term interruptions to domestic refined products supply and distribution 

infrastructure.,. 

Based on information reviewed during the course of our ongoing work, to 

respond to disruptions, 27 of the 29 lEA member countries use one of five 

reserve structures, also known as stockholding structures, in which these 

countries hold public reserves, industry reserves, or a combination of 

these. 37 The five structures are shown in figure 2. Also, most members 

hold refined petroleum products, with many members holding at least a 

third of their reserves in refined petroleum products. Some members hold 

their refined petroleum products in different regions across their country 

to respond to disruptions. 

:l6u.s. Department of Energy, David F. Johnson, Deputy Assistant Secretary for 

Petroleum Reserves, Developing Refined Products Storage in the Strategic Petroleum 

Reserve, testimony before the Committee on Energy and Natural Resources, United 

States Senate, May 12,2009, accessed October4, 2017, 

https:l/energy_gov/fe/artic!es/developing~refined-products-storage-strategic-petro!eumreserve 

37The lEA refers to the various approaches that lEA member countries use to hold their 

reserves of oil or petroleum products as "stockholding structures." As net exporters, 

Canada, Denmark, and Norway do not have a stockholding obHgation under the 

International Energy Program Agreement However, despite being net exporters, Norway 

and Denmark have stockholding structures by law. According to lEA officials, Australia is 

not compliant in meeting its stockholding obllgations currently. 

Page 16 GA0~18~209T Strategic Petroleum Reserve 
64 


Figure 2: Preliminary Analysis of Strategic Reserve Structures Used by international Energy Agency Member Countrie-s 

Based on our preliminary analysis of information on the 29 lEA member 

countries, 18 place a stockholding obligation on industry either exclusively 

or in part to meet their total emergency reserve needs. Most of these 

countries distribute the stockholding obligation in proportion to 

companies' share of oil imports or of sales in the domestic market. 

However, several member countries instead impose a higher obligation 

on refineries because of their high amount of operating oil. 

Page 17 GA0~18~209T Strategic Petroleum Reserve 
65 


According to a 2014 lEA report," most lEA members hold some amount 

of refined petroleum products, and a European Union (EU) directive 

generally requires EU members to ensure that at least one-third of their 

stockholding obligation is held in the form of refined petroleum products. 39 

For example, according to the lEA's website, Germany's stockholding 

agency, Erdolbevorratungsverband (EBV), holds 55 percent of its reserve 

in refined petroleum products such as gasoline, diesel fuel, and light 

heating oil. 40 In contrast, the United States holds almost all of its reserves 

in oil rather than refined petroleum products. 

Some lEA member countries geographically disperse their reserves of 

refined petroleum products to be able to respond to domestic disruptions. 

For example, according to the lEA's website, to maintain a wide 

geographical distribution of emergency reserves, the French stockholding 

agency stores refined petroleum products in each of its seven geographic 

zones. 41 Moreover, according to the lEA's website, France's agency 

stores petroleum product reserves in each zone; reserves in each zone 

should represent specified amounts based on consumption in order to 

respond to emergencies. 42 During a labor strike in December 2013, 

France used its emergency reserves to supply local gas stations when 

delivery of fuel was impeded for a prolonged period of time, according to 

a French document. In another example, the lEA reported that Germany 

holds petroleum product reserves in several regions in the country and 

that the reserves are to be distributed throughout Germany, so that a 

minimum reserve equivalent to a 15-day supply is maintained in each of 

38 lnternat1onal Energy Agency, Energy Supply Security, Emergency Response of lEA 

Countries (Paris, France: 2014) 

39Specifically, the EU directive states that if a member has not committed to maintaining at 

least 30 days of specific reserves, it shall ensure at least one~th1rd of its obligation is held 

in the form of certain specified products, including petroleum products. See Council 

Directive 091119, art. 9, 2009 O.J. (l 265) 15 (EU). 

401nternational Energy Agency, Germany OH Stocks, accessed September 20, 2017, 

http://www.iea.org/countries/membercountries/germany/ol!stocks/; and International 

Energy Agency, Energy Supply Security, Emergency Response of lEA Countries (Paris, 

France 2014) 

41 lnternat1onal Energy Agency, France Oil Stocks, accessed September 25, 2017, 

http://www.iea.org/countries/membercountries/france/ol!stocks/. 

421nternationa! Energy Agency, France Oil Stocks, accessed September 25, 2017, 

http://www.iea.org/countries/membercountrieslfrance/oi!stocks/ 

Page 18 GA0·18~209T Strategic Petroleum Reserve 
66 


five designated supply areas.'' The rationale for this is to prevent 

logistical bottlenecks that could occur if all emergency reserves were 

stored centrally, according to a 2014 lEA report44 

Based on our preliminary observations, DOE has taken some steps to 

evaluate different structures for holding reserves. However, the agency 

has not formally evaluated other countries' structures in over 35 years 

and has not finalized its 2015 studies on regional petroleum product 

reserves. According to DOE officials, the agency explored the feasibility 

of adopting the industry structure shortly after creating the SPR and 

concluded that this and other structures were not feasible in the United 

States. In 1980, DOE studied the feasibility of adopting the agency 

structure, which is the most similar to the SPR since the only major 

difference is how the reserve is funded,'' according to DOE officials. 

According to lEA documents, in the agency structure, generally the 

reserve is funded by a tax or levy on products or industry, which is 

passed down to the consumer. In contrast, the SPR is funded through 

congressional appropriations. However, DOE officials we interviewed 

cautioned that the agency has not reassessed its findings from 35 years 

ago. As mentioned above, in 2016 DOE reassessed the SPR in light of 

the changing global oil market, but this assessment did not include a 

review of other lEA countries' structures. 

Our preliminary review indicates that DOE examined the feasibility of 

additional regional petroleum product reserves in two 2015 studies, but it 

did not finalize these studies or expand the SPR to include additional 

reserves. In September 2014, we reported that DOE officials told us they 

were conducting a regional fuel resiliency study that would provide 

insights into whether there is a need for additional regional product 

reserves and, if so, where these reserves should be located. The 

Quadrennial Energy Review of 2015 recommended that the agency 

analyze the need for additional or expanded regional product reserves by 

undertaking updated cost-benefit analyses for all of the regions of the 

431nternational Energy Agency, Energy Supply Security, Emergency Response of lEA 

Countries (Paris, France: 2014). 

44 !nternational Energy Agency, Energy Supply Security, Emergency Response of lEA 

Countries (Paris, France: 2014). 

45As mentioned above, the establishment of the SPR was authorized by statute. 

According to DOE officials, establishment of an agency structure in the United States as 

an alternative to the SPR would similarly require new legislation 

Page 19 GA0-18~209T Strategic Petroleum Reserve 
67 


United States that have been identified as vulnerable to fuel supply 

disruptions. Figure 3 illustrates vulnerabilities that DOE identified in 2014. 

Figure 3: U.S. Strategic Petroleum Reserve Locations and 'Regional Petroleum Supply Vulnerabilities Identified by the 

Department of Energy in 2014 

In response to the 2015 recommendation, DOE contractors studied the 

feasibility of additional regional petroleum product reserves, as part of the 

SPR, in the U.S. Southeast and West Coast regions to address supply 

vulnerabilities from hurricanes and earthquakes, respectively. According 

to DOE officials, weather events in the Southeast are of higher probability 

but lower consequence, and events in the West Coast are of lower 

probability but higher consequence. DOE did not finalize its 2015 studies 

on regional petroleum product reserves and make them publicly available. 

Page 20 GA0·18-209T Strategic Petroleum Reserve 
68 


According to DOE officials, because consensus could not be reached 

within the Administration on several issues associated with the refined 

product reserve studies, these studies were not included as part of DOE's 

2016 long-term strategic review of the SPR. Our ongoing work indicates 

that DOE's 20161ong-term strategic review of the SPR did not account for 

the risks of domestic supply disruptions as a factor in determining the 

appropriate size, location, and composition of the SPR. Prior to the two 

2015 studies, in 2011, DOE carried out a cost-benefit study of the 

establishment of a refined product reserve in the Southeast and 

estimated that such a reserve would reduce the average gasoline price 

rise by 50 percent to 70 percent in the weeks immediately after a 

hurricane landfall, resulting in consumer cost savings, according to the 

Quadrennial Energy Review of 201546 

In closing, I note that we are continuing our ongoing work examining 

issues that may help inform future considerations for the SPR Given the 

constrained budget environment and the evolving nature of energy 

markets and their vulnerabilities, it is important that DOE ensures the 

SPR is an efficient and effective use of federal resources. We look 

forward to continuing our work to determine whether additional DOE 

actions may be warranted to promote this objective. 

Chairman Upton, Ranking Member Rush, and Members of the 

Subcommittee, this concludes my prepared statement. I would be 

pleased to respond to any questions that you may have at this time. 

46According to DOE officials, all aspects of the 2011 study remain draft and pre~decisiona! 

since DOE did not officially approve the study 

Page 21 GA0~18~209T Strategic Petroleum Reserve 
69 


GAO Contact and 

Staff 

Acknowledgments 

(102384) 

If you or your staff have any questions about this testimony, please 

contact Frank Rusco, Director, Natural Resources and Environment, at 

(202) 512-3841 or ruscof@gao.gov. Contact points for our Offices of 

Congressional Relations and Public Affairs may be found on the last page 

of this statement. Key contributors to this testimony include Quindi 

Franco, Assistant Director; Philip Farah, Ellen Fried, Nkenge Gibson, 

Cindy Gilbert, Gregory Marchand, Patricia Moye, Camille Pease, Oliver 

Richard, Danny Royer, Rachel Stoiko, Marie Suding, and Kiki 

Theodoropoulos. 

Page 22 GA0-18-209T Strategic Petroleum Reserve 
70 


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72 

Mr. UPTON. Well, thank you all. At this point we will move to 

questions from the dais. 

Mr. Alexander, you said in your testimony that the Corps is overseeing the work that is done by PREPA in Puerto Rico. I would like 

to ask the question, how has that gone? Because this subcommittee 

has tried to contact PREPA both by email and phone. They are not 

answering. There is no heartbeat that we are getting back. So, how 

has that oversight gone? 

Mr. ALEXANDER. Sir, perhaps I misstated. We have a task force— 

again, general officer, senior-executive-led—that is overseeing our 

mission to restore the grid, as assigned by FEMA. What we are 

doing with PREPA, though, is we are working in coordination and 

collaboration with them, so that we can have well-defined, focused 

areas of operation. So, we are not working in each other’s area and 

we ensure that there are no gaps. We are only working with 

PREPA; we are not working for PREPA, but we are working in coordination with PREPA. 

The oversight of the Corps’ mission assignment we believe is 

going well. Again, we were assigned this mission on 30 September. 

Within 18 days, we were able to award three major contracts, one 

for temporary power generation, two 30-megawatt power plants to 

be put in the vicinity of the Palo Seco Power Plant near San Juan, 

and restore the power grid around San Juan. Those generators 

have arrived. They have been installed, and we have additional 

load on the grid in the greater San Juan area as of several days 

ago. 

The other two contracts focused on line repair, transmission dis- tribution/line repair. A larger contract to Fluor, a $240 million contract. They have boots on the ground today. They are conducting 

assessments. They are starting to have crews arriving. I believe, as 

I said in my testimony, we are ramping up quickly, 620 by the end 

of this weekend, and that number will double by mid-November. 

And then, we also have a company named PowerSecure. They 

are fully engaged and will be—they, too, have assessment teams on 

the ground. Their equipment is actually en route by sea now on a 

MARAD, Ready Reserve Fleet vessel that should arrive at Ponce 

port on 3 November. 

Mr. UPTON. Did the Corps have any advance knowledge of working with PREPA prior to the contract that they established with 

Whitefish and Cobra? Were you aware of that contract before it 

was signed? 

Mr. ALEXANDER. No, sir, we were not. We were engaged in our 

temporary power mission under the Stafford Act, and we have been 

working that since the 6th of September. The news that PREPA 

had independently committed in a contract to another company, we 

were not consulted; we were not aware. 

Mr. UPTON. You indicated in your written testimony that the 

temporary housing plan includes establishing—this is as it relates 

to Texas—20,000 travel trailers and 4,000 mobile housing units. I 

presume that most of those are for folks that were actually displaced, homeowners or families that were displaced. Do you know 

what that number is for Puerto Rico? It’s 20,000 for Texas. Do you 

know what the number would be for Puerto Rico? 

Mr. ALEXANDER. No, I do not, sir. 

73 

Mr. UPTON. Ms. Hoffman, I have met with a number of pharmaceutical/medical device companies, many with very large operations 

in Puerto Rico. We are all aware of the critical need to get those 

facilities back online. It is a public health priority because it is so 

critical for patients to ensure that their products that are being 

manufactured there don’t go into a shortage. How are you incorporating medical manufacturing in an approach to restore the grid 

in Puerto Rico? 

Ms. HOFFMAN. So, thank you. 

Critical infrastructure, critical loads on an electric system is very 

important, utilities. In our conversation with the utilities, with 

FEMA and the interagency partners, we discussed what are some 

of those priority restoration efforts and helping with the communications, so that we understand where some of those needs are 

and where some of the activities should be with respect to restoration processes. So, those coordinations occur with FEMA and with 

the local utilities in the Territory itself. 

Mr. UPTON. OK. Thank you. My time has expired. 

I recognize the ranking member of the subcommittee, Mr. Rush, 

for 5 minutes. 

Mr. RUSH. I want to thank you, Mr. Chairman. 

Mr. Alexander, I am kind of curious, not ‘‘kind’’, I am very curious about your Army Corps of Engineers’ lack of information about 

this Whitefish contract. You, the Army Corps of Engineers, were 

unaware of this contract, is that correct? 

Mr. ALEXANDER. Yes, sir. 

Mr. RUSH. The Governor says he was unaware of this contract. 

Mr. ALEXANDER. I’m sorry, sir, did you say—— 

Mr. RUSH. The Governor of Puerto Rico has stated publicly that 

he was unaware of this contract. 

Mr. ALEXANDER. The Governor of Puerto Rico said he was unaware? 

Mr. RUSH. Right. 

Mr. ALEXANDER. Sir, I am not privy to that. I do not know. 

Mr. RUSH. Are you aware that this contract is being canceled or 

has been canceled? 

Mr. ALEXANDER. Sir, I understand that the Governor has given 

the direction to terminate that contract. Whitefish and other contractors, they are completing the task, the last task they have been 

assigned. So, they are still working on the island. 

Mr. RUSH. Do you have any information about who executed that 

contract? 

Mr. ALEXANDER. No, I do not. 

Mr. RUSH. Do you trust PREPA? Do you trust them? 

Mr. ALEXANDER. Sir, I have no reason not to. Again, we are 

working in collaboration with them on restoring the power. 

Mr. RUSH. Do you have any estimate in terms of how much additional dollars the cancellation of this contract will cost the American people? 

Mr. ALEXANDER. No, I do not. 

Mr. RUSH. All right. Secretary Hoffman, the economic consulting 

firm Rhodium Group concluded that Maria cost 1.25 billion hours 

of electricity supply disruption to households, which they say is the 

74 

longest disruption in recorded history. Do you concur with their 

finding? 

Ms. HOFFMAN. I will have to look at the information, but it is a 

significant duration for outage for Puerto Rico. 

Mr. RUSH. And what is the best estimate on when power will be 

fully restored to both the U.S. Virgin Islands and Puerto Rico? 

Ms. HOFFMAN. So, that is information that the Governor as well 

as PREPA is looking at, as well as partnerships with the Army 

Corps of Engineers, on the supplies that are needed, the resources 

that are required for restoring power. Some initial indications are 

that for, I would say 50 percent—I believe the Army Corps has estimated that 50 percent of the island will be restored by the end 

of December, and that the significant portion of the restoration will 

occur later on. 

Mr. RUSH. Mr. Alexander, can you give us some insight on your 

opinions about the timeline, the estimated timeline? There might 

be some others on the panel that might also have some idea about 

the estimated timeline for Puerto Rico and, also, the U.S. Virgin Islands. 

Mr. ALEXANDER. Sir, as for Puerto Rico, we estimated 30 percent 

of the prestorm load on the grid would be restored by 30 October. 

We did achieve that metric on time before the 30th. I believe we 

are up over 31, 32 percent today. Our estimate is 50 percent 

prestorm load restored by 30 November. And then, as we go on into 

the new year, we are estimating 75 percent by 31 January. 

Mr. RUSH. Anyone else want to add? 

[No response.] 

All right. Mr. Alexander, is the Corps currently involved in discussions with PREPA, or any other Government entity in Puerto 

Rico, to ensure that when the grid is repaired, it will meet construction—it will be a way to account some of the lessons learned 

from this ongoing catastrophe for the American taxpayers’ dollars 

are not being wasted? 

Mr. ALEXANDER. Sir, we are focused on executing the mission we 

have been assigned, which is the restoration of the grid to prestorm 

conditions, the load, and we are coordinating with PREPA as we 

do that. We actually, though, are working with the Department of 

Energy on what a more resilient grid might look like, as they lead 

the effort to develop recommendations and cost estimates. But, for 

now, we are executing our mission under the Stafford Act, which 

does not allow for any permanent construction or enhancement of 

the existing grid. 

Mr. RUSH. I yield back, Mr. Chairman. 

Mr. UPTON. The Chair will recognize the vice chair of the subcommittee, the gentleman from Houston, Texas, Mr. Olson. 

Mr. OLSON. I thank the Chair. 

And welcome to all five witnesses. A special pony up to the new 

chairwoman of the PUC of Texas, Ms. DeAnn Walker. My daughter 

Kate is a junior at SMU, your alma mater, and she loves it. 

My first two questions are for you, Mr. Alexander, one about 

Harvey and one about Irma. First of all, Harvey. As you know, sir, 

I live in Fort Bend County, Texas. When Fort Bend floods, it floods. 

We have had four major floods in the past 3 years. Our drainage 

district works hard 24/7, 365, to make sure our drainage ditches 

75 

are maintained. After the first major flood in 2015, the Army Corps 

told our drainage district they need a Section 404 permit under the 

Clean Water Act to maintain the ditches. The maintenance of a 

drainage ditch is supposed to be exempt from the permitting process under Section 404. But the Corps disputed the exemption and 

referred the district to the EPA. The EPA agreed it is maintenance 

work and the county should be good to go. But here we are, 2 years 

and four floods later, with Fort Bend County still unable to fix this 

critical problem. And now, Harvey has made a bad problem much, 

much worse. 

These repairs can’t wait. Texas and Fort Bend need to rebuild 

after Hurricane Harvey. Things are being made worse with erosion 

and piles of silt. We don’t need red tape at the Corps hindering the 

maintenance project that should be exempt under Section 

404(f)(1)(C) of the Clean Water Act. 

My question is, will you guarantee me that your office will work 

with my staff and local Fort Bend County officials, under Judge 

Bob Hebert, to get this fixed ASAP, so Texans can protect their 

livelihoods? 

Mr. ALEXANDER. Sir, thank you. I acknowledge your concerns. I 

am generally aware of this issue in Fort Bend. While I do not have 

all the specific details here with me today, I can assure you and 

can guarantee you that the Corps remains committed to working 

with our partners and your office to resolve this issue. 

Mr. OLSON. Great. ASAP, please. 

The next question about Hurricane Irma that follows up on comments and questions from my colleague from Illinois, Mr. Rush. 

Sir, have you ever talked to someone on the ground in PREPA? 

Have you, yourself, talked to someone on the ground PREPA about 

the situation in Puerto Rico? 

Mr. ALEXANDER. No, sir, I have not. 

Mr. OLSON. Wow, have not. OK. 

The second round of questions is for you, Ms. Walker. First of all, 

I want to thank you for your service to our State. I appreciate your 

work in guiding us through Harvey. And I know Drew Vincentchild 

at the PUC. You have been our PUC Chair for 41 rather intense 

days, I do believe. And as you know, for a city like Houston, I want 

you to talk about how Harvey as being a storm event with heavy 

rain as opposed to wind and storm surge, and how does that 

change the impacts you have to address? And what was the biggest 

surprise you had to recovery? Can we help with that surprise to 

mitigate that, either DC or NGOs? How can we address your concerns/surprises after Hurricane Harvey with our grid there in Fort 

Bend County, Texas? 

Ms. WALKER. Well, as you noted, wind damage is very different 

than flooding damage, and Houston did have the flooding damage 

during this hurricane. The biggest surprise was the amount of rain. 

There was substations such as Memorial substation that took on 

water that had never taken on water in the 50 years that it had 

been there. And so, we were having to come up during the storm 

with ways to address all of the flooding, moving crews. Frankly, 

they were using aquatic equipment that they had never used before 

to get to things because of the flooding. 

76 

Houston, also, downtown experienced heavy flooding. I believe I 

heard that 83 of the downtown buildings lost power, and I think 

some still are without power. Luckily the medical center did not. 

We have reinforced the medical center time and time again since 

Hurricane Allison. It wasn’t a hurricane, but since Allison. 

And so, I am not sure of anything that you all can pass here that 

would help us. We continue to learn from each storm. Each storm 

is different. Hurricane Ike was a wind event. It took, out of 2.2 million, it took out 2 million. It was a much different storm. 

Mr. OLSON. Again, being a Member who lives in the area, I have 

to thank you so much because, when Harvey hit my house twice 

in two days, we never ever, ever lost power. So, thank you for that. 

I yield back. 

Ms. WALKER. Thank you. 

Mr. UPTON. The Chair recognizes the ranking member of the full 

committee, Mr. Pallone. 

Mr. PALLONE. Thank you, Mr. Chairman. 

Obviously, in addressing the panel, I have to say it, express my 

concern that the Federal response so far is nowhere near where it 

needs to be. Reports indicate nearly 70 percent of Americans on the 

island are without electricity. The New York Times recently described the situation of Puerto Rico, quote, ‘‘like going back in 

time’’. Most of my questions are of Mr. Alexander and the Corps. 

Mr. Alexander, who is in charge of the effort to restore power in 

Puerto Rico and the Virgin Islands? Is it the Army Corps or another agency? 

Mr. ALEXANDER. Sir, again, our mission assignment from FEMA 

is to restore the grid to prestorm condition in coordination/collaboration with PREPA. 

Mr. PALLONE. That is fine. I just wanted to get—— 

Mr. ALEXANDER. OK. 

Mr. PALLONE. You answered my question. 

Is there a strategic plan for these Federal restoration efforts? 

Mr. ALEXANDER. Sir, if you look at strategic beyond the prestorm 

restoration, that is being looked at by Energy and other departments and the interagency—— 

Mr. PALLONE. So, the DOE is more responsible for a long-term 

plan, is that what you are saying? 

Mr. ALEXANDER. For full, permanent grid restoration enhancement, yes, sir. 

Mr. PALLONE. And you are more involved in trying to get things 

up and going? 

Mr. ALEXANDER. Sir, we are involved in trying to restore the grid 

in different sectors as expeditiously as possible with concentration 

initially on San Juan and, then, out to seven larger municipalities 

on the island, and then, finally, preparing and transitioning to 

PREPA for permanent service. 

Mr. PALLONE. All right. Now how many companies—yes, I understand the Corps has several contracts with private companies for 

restoration work—how many companies has the Corps contracted 

with to perform the grid-rebuilding work in Puerto Rico? 

Mr. ALEXANDER. Sir, we have contracted with three companies. 

Mr. PALLONE. And will the Army Corps provide the committee 

with copies of those contracts, so that we can get an understanding 

77 

of their scope? Would you be willing to do that through the chairman? 

Mr. ALEXANDER. Sir, I will have to speak to our contracting authority and see what is permissible because it is acquisition-sensitive material. 

Mr. PALLONE. All right. If you can, we would appreciate it. I 

know I am acting through the chairman in asking you for it. 

We have heard varying reports as to how long it will take to restore power to the citizens of Puerto Rico. By some accounts, it will 

be many more months until power is fully restored. So, Mr. Alexander, when did the Army Corps receive its mission to repair Puerto Rico’s grid from FEMA? 

Mr. ALEXANDER. On 30 September. 

Mr. PALLONE. And Hurricane Maria made landfall in Puerto Rico 

on September 20th. Do you know why it took FEMA 10 days to 

give the Army Corps its mission? 

Mr. ALEXANDER. Sir, we were not involved in deliberation. We 

were executing our temporary emergency power at that time. 

Mr. PALLONE. All right. Just on that issue, does the Army Corps 

mission assignment provide—well, I guess you did answer that. 

You basically said, if I understood, that the short-term repairs in 

San Juan and these other areas is under your jurisdiction, but the 

long-term and fully reconstruction of a more efficient and resilient 

grid, that would be more DOE, correct? 

Mr. ALEXANDER. Yes, sir. 

Mr. PALLONE. All right. So, then, let me turn to Ms. Hoffman, 

to the DOE witness. If the Army Corps is not responsible for making long-term improvements, is the DOE taking the lead on this effort? 

Ms. HOFFMAN. So, the Department of Energy is looking at strategies for long-term improvements with respect to strengthening the 

grid. So, ideas such as energy storage, microgrids or minigrids, options for rerouting power, better situational awareness, all those 

activities are activities that we are looking at. But, once again, the 

actual financing and implementation is the responsibility of the 

utilities or the governance structure that will be decided for Puerto 

Rico. 

Mr. PALLONE. But you stated in your testimony that DOE is 

leveraging the National Labs to develop long-term solutions to improve resiliency. What is the status of that effort? 

Ms. HOFFMAN. So, the National laboratories, we have been in active discussion with the Grid Modernization Lab Consortium in 

looking at areas such as planning activities, situational awareness, 

looking at analysis-type activities, as well as hardening activities. 

What this is going to have to be done as is mirrored up with the 

existing rebuilding process and looking at how some of the innovative solutions can be married in and built upon the existing rebuilding. So, that is going to take time and it is going to have to 

run in close coordination. So, we have seven technical experts in 

Puerto Rico working with the Army Corps to understand the timing and the extent of where their activities are going and opportunities for the future. 

Mr. PALLONE. All right. Thank you so much. 

Thank you, Mr. Chairman. 

78 

Mr. UPTON. The Chair will recognize the gentleman from Illinois, 

Mr. Shimkus. 

Mr. SHIMKUS. Thank you, Mr. Chairman. 

I want to try to go to three different directions real quick. But, 

Mr. Alexander, I am a former military officer. Someone has to be 

in charge. So, I think it is very troubling that we have you all there 

trying to restore the grid and you are not in consultation with 

PREPA. The basic question is, if you are going to call and yell at 

someone to get the job done, does anyone know who we are going 

to call? Mr. Alexander? 

Mr. ALEXANDER. Sir, my job is really—— 

Mr. SHIMKUS. Yes, you have been very good at trying to answer 

this tactfully. But who do we call? 

Mr. ALEXANDER. FEMA. 

Mr. SHIMKUS. We call FEMA? 

Mr. ALEXANDER. FEMA. 

Mr. SHIMKUS. OK. Do we get our answer? 

Mr. ALEXANDER. It is the authority we are operating under. 

And I will say this: from our Chief of Engineers to our South Atlantic Division commanding general, and to a number of colonels 

that are on the ground in Puerto Rico, they collaborate and meet 

with PREPA on a daily basis. 

Mr. SHIMKUS. OK. Thanks. So, I think we probably should have 

FEMA here. That is who we should have had, FEMA, as far of this 

committee hearing. So, maybe we will do that as a followup. 

Because, obviously, we all know the history behind PREPA and 

the bankruptcy and their questionable practices and their ability 

even to provide power before the storm. 

Does anyone know why it took—and Puerto Rico is separate because it is an island; it is far away; it is hard. Other States usually 

have, with the utilities have mutual assistance agreements. And 

you will see folks flow. Does anyone know if PREPA had a mutual 

assistance agreement with any stateside utility? Does anyone know 

that? 

Ms. HOFFMAN. It is my understanding that PREPA had not 

asked for mutual assistance agreements. Early on in the storm 

they just did ask for it. 

Mr. SHIMKUS. Yes, I have been told it took five weeks, PREPA 

took five weeks to ask anybody for help. 

Ms. HOFFMAN. Yes, a letter was submitted two days ago, I believe, for mutual assistance. But, generally, the industry is very 

forward-leaning in discussing with the utilities and activating mutual assistance—— 

Mr. SHIMKUS. Well, we see it all the time. 

Ms. HOFFMAN. Yes. 

Mr. SHIMKUS. I mean, the trucks are on the road, whether there 

is an ice storm, whether there is in my neck of the woods a tornado, whether it is hurricanes. I have members of my congregation 

who are utility workers, and they are gone. That is a disappointing 

statement. 

I also wanted to put on the record, I think we wanted the Nuclear Regulatory Commission to submit a letter for this hearing because the hurricanes did come through some of our locations where 

we have nuclear power plants, and we think that would help build 

79 

1The information has been retained in committee files and also is available at http:// 

docs.house.gov/meetings/IF/IF03/20171102/106573/HHRG-115-IF03-20171102-SD010.pdf. 

the record of the resiliency, baseload power, the importance of that. 

And I would ask that, if we finally get a letter from the NRC, Mr. 

Chairman, that we are allowed to submit that for the record.1

And the last point, I really want to go to Mr. Rusco and maybe 

Mr. Corbin. The crude oil world has changed significantly since the 

establishment of the SPRO. I have been here a long time, 20 years, 

and I think one thing is for sure: we have always bought high and 

sold low. Is that a safe statement in the history of the SPRO, in 

the purchase of crude oil? Mr. Rusco, do you want to answer that? 

Mr. RUSCO. I think that, just by the nature of when it was established, you know, it was established after a crisis. Usually, when 

DOE has had authority to expand, it is—— 

Mr. SHIMKUS. Quickly. 

Mr. RUSCO [continuing]. After a crisis. And so, it has been at 

higher prices. 

Mr. SHIMKUS. So, we have a history of buying high and selling 

low? 

Mr. RUSCO. At least buying high. 

Mr. SHIMKUS. And your testimony talked about refined products. 

In the world really now the need is for immediate refined product, 

not base crude oil. In the old days when we were worried about deploying forces to Europe and sea lanes being closed, and importation of crude oil, a SPRO made sense. Am I right, based upon your 

testimony today, that you are saying maybe regional systems— 

well, actually, regional systems which DOE was supposed to analyze, and that there would be more focus on refined product? 

Mr. RUSCO. I think that it is fair to say that most other countries 

that have strategic reserves have chosen to do that, for the reasons 

that you state, yes. 

Mr. SHIMKUS. Thank you. I hope my colleagues will follow up on 

some of those questions. I have run out of time. I yield back. 

Mr. UPTON. The Chair recognizes the gentleman from California, 

Mr. McNerney. 

Mr. MCNERNEY. Well, I thank the chairman, and I thank the 

witnesses this morning. 

Mr. Alexander, you mentioned prevention as a part of the mission. Within the Stafford Act framework, can the electric structure 

of Puerto Rico be rebuilt to improve grid resilience and using sustainable technology? 

Mr. ALEXANDER. Sir, the Stafford Act allows us to restore the 

grid to prestorm conditions, meeting U.S. Code, electrical code, in 

order to satisfy life, health, safety requirements. Some have interpreted that to mean we are making a more resilient or betterment 

on the system, but that is not the case. 

Mr. MCNERNEY. OK. Ms. Hoffman, has there been a credible estimate of the cost difference between rebuilding a system that is resilient and just rebuilding the old system to look like it did before? 

Ms. HOFFMAN. There has not been a complete cost estimate, taking into consideration the amount of work that has been done and 

that is being planned to be accomplished from the Army Corps of 

Engineers. So, there has been discussion around different advanced 

80 

solutions, but that needs to be baselined with the work and the 

building planout. So, that needs to be evaluated still. 

Mr. MCNERNEY. So, it could be that building a system that is resilient and sustainable wouldn’t cost much more than just rebuilding the old system up to code? 

Ms. HOFFMAN. I think the analysis has to be completed. 

Mr. MCNERNEY. OK. Thank you. 

The Office of Electricity has worked on a State Energy Risk Assessment Initiative that helps States understand the risks to their 

infrastructure. Did the Virgin Islands and Puerto Rico have a risk 

profile before the hurricanes? 

Ms. HOFFMAN. I would have to go back and look into that. I am 

not sure whether they did do a risk profile with the State assessments. 

Mr. MCNERNEY. Thank you. 

Mr. Stafford, is it true that the National Science Foundation facility at the radiotelescope has an infrastructure that supported 

FEMA operations subsequent to the hurricane? 

Mr. SHIMKUS. You said ‘‘Stafford’’. 

Mr. MCNERNEY. Oh, Mr. Alexander? Excuse me. Thank you, my 

colleague from Illinois. 

Go ahead. 

Mr. ALEXANDER. Sir, now that I know it was me you were talking 

to, could I ask you, please, to repeat the question? 

Mr. MCNERNEY. Sure. Is it true that the National Science Foundation facility radiotelescope infrastructure survived well enough to 

serve as a FEMA operations center? 

Mr. ALEXANDER. Sir, I am not aware of that. 

Mr. MCNERNEY. OK. I was going to ask you what differentiated 

that facility that survived from facilities that did not survive. Does 

anyone have a clue to that question? 

Mr. ALEXANDER. I do not. 

Mr. MCNERNEY. No? 

Ms. Walker, you highlighted the inconsistencies in tracking outages in the system. Would better tracking of outages be beneficial? 

Or how would it be beneficial? 

Ms. WALKER. It helps us determine where to deploy services, 

such as, we call them pods, but water, food, whether or not outages 

are going to be restored quicker, and we know how many in the 

area have outages. We are able to, then, deploy the needs for that 

community better with that knowledge; also, working with the 

Corps of Engineers on deploying temporary generators. It just 

helps us to understand where to deploy for those needs. 

Mr. MCNERNEY. Do you have the authority to require utilities to 

report outages? 

Ms. WALKER. Yes, we do. 

Mr. MCNERNEY. Is that authority a State authority or is it a Federal authority? 

Ms. WALKER. It is a State. 

Mr. MCNERNEY. Thank you. 

Ms. Hoffman, how does the DOE go about helping utilities 

prioritize which lines, substations, and so on, should be put online 

first? 

Ms. HOFFMAN. So, thank you very much for the question. 

81 

The utilities have a restoration plan as they look at their outage 

management system. They look at prioritization for transmission 

lines to get the most customers on as soon as possible and, then, 

work down into the distribution system. But they first must do 

damage assessments and assess really the extent of the damage on 

the system, and accelerating that damage assessment really helps 

a utility outline the restoration process. 

What the Federal Government does is look at where the critical 

infrastructure is and are there any special needs with respect to 

storing large loads or storing critical infrastructure, whether it be 

telecommunication facilities, hospitals. And so, that is an ongoing 

discussion. But it gets melded with a utility’s restoration plan and 

the utility’s commitment with respect to how they are doing the 

restoration. 

Mr. MCNERNEY. I yield. 

Mr. UPTON. The Chair recognizes the gentleman from Ohio, Mr. 

Latta, for 5 minutes. 

Mr. LATTA. Well, thanks very much, Mr. Chairman, and for calling this hearing today. And thanks to our witnesses for being here. 

Ms. Hoffman, if I could ask you my first question, you noted that 

one of the reasons for the rapid electrical recovery in Florida was 

the nearly $3 billion in grid resiliency improvements since 2006. 

Could you elaborate as to what those improvements were, and will 

DOE be working with Florida going forward to identify additional 

hardening practices? 

Ms. HOFFMAN. So, thank you, sir, for the question. 

The investments by Florida really have stimulated from activities that looked at, first, situational awareness, so looking at advance meter and infrastructure to provide the situational awareness that we have been talking about. Because, once you have that 

awareness, you can do an outage management system. You can actually look at how you can advance and preposition crews for a restoration process. It also has allowed for advanced switching to be 

able to minimize the amount of customers without power; versus 

taking down a whole feeder system, you can really isolate damage 

on a system and look at restoration opportunities. 

Other things that the utilities have done is hardening their infrastructure by looking at stronger poles, looking at concrete poles, 

steel poles, versus your traditional wooden poles. But all these capabilities are pulled together with an advanced kind of communications and control system, but a situational awareness system that 

can help with the restoration process. 

Mr. LATTA. OK. You are talking about the different types of 

poles. Are there other things that they were doing on hardening, 

did you say? 

Ms. HOFFMAN. So, with respect to substations—and this would 

probably go more for Sandy, but also looking at hardening substations and being able to—— 

Mr. LATTA. And how do they go about hardening the substations? 

Ms. HOFFMAN. Pardon? 

Mr. LATTA. How do they go about hardening the substations? 

Ms. HOFFMAN. So, when hardening the substations, you really 

look at increased capabilities with respect to duration, being able 

to support prevention of damage from wind, but also from flooding. 

82 

So, it goes back to supporting infrastructure, so that you don’t see 

the flooding damage that can occur. 

Mr. LATTA. OK. Thank you. 

Ms. Walker, if I could turn to you, can you elaborate on working 

with the Federal agencies after Hurricane Harvey? And could you 

see any improvements that need to be made between Federal, 

State, local, industry, all working together out there? Or what is 

your view as to what happened, and is there anything that can be 

improved on? 

Ms. WALKER. I think there are improvements that we can make. 

My view is that the time to make those is before the next storm. 

I found myself in the State Operations Center addressing issues 

that I think are better to try to handle after the storm and get 

ready for the next one. Some have to do with the interconnection 

for the FEMA temporary housing. Some had to do—— 

Mr. LATTA. Could you elaborate on that, on the temporary housing, because I know I’ve seen different press reports on that, but 

would you elaborate on the temporary housing of FEMA? 

Ms. WALKER. Once they bring in temporary housing, it is not set, 

usually, right at the meter that the house is on. So, the utilities 

have to set a new pole. There are processes in Texas for each utility, and my guess is throughout the country for each utility, on how 

those processes are to interconnect the new customer, a new facility. 

And we would like to streamline that for all utilities in Texas. 

We had five major utilities impacted by Harvey and, then, multiple 

coops and municipalities. And so, we are hoping to have one process for FEMA to have to go through, instead of multiple different 

processes. So, that is an example. 

Mr. LATTA. OK. Any other examples you can think of that would 

be how to improve things out there? 

Ms. WALKER. We understood, or I understood, during Hurricane 

Harvey that there were issues, chokepoints, as they were called 

during Hurricane Ike, related to the processes, inspection processes, for cities to get homes reconnected once they are rebuilt, 

once they are remodeled. And so, I think that is something we can 

address going forward, how those inspections are done, who does 

them, to make sure we have enough people on the ground. 

It was during recovery. It is not, to me, the time to try to be addressing things like that. And I just think that that is something 

we can look at going forward. 

Mr. LATTA. OK. Well, thank you very much, Mr. Chairman. My 

time is just about expired, and I yield back. 

Mr. OLSON [presiding]. The gentleman yields back. 

The Chair now calls upon the gentleman from Pennsylvania, Mr. 

Doyle, for 5 minutes. 

Mr. DOYLE. Thank you, Mr. Chairman. 

Ms. Hoffman, welcome back to our committee. It is always nice 

to have another Penn-Stater here at the committee. 

Let me ask you, in your testimony you explained DOE’s role in 

restoration and recovery efforts in those areas affected by recent 

hurricanes. A DOE piece from 2015 published in Power & Energy 

Magazine that is still on your energy.gov site explained that, and 

I quote, ‘‘Both the frequency and intensity of these disaster events 

83 

have been trending higher in recent years, with 7 of the 10 costliest 

storms in U.S. history occurring in the last 10 years. These weather disaster events represent one of the most significant threats 

posed by climate change.’’ Now that was published in 2015. And 

since that time, we have witnessed the most extreme month of hurricanes that has ever been recorded earlier this year. 

So, I want to ask you, how is the Department of Energy responding to this increasing threat of climate change and extreme weather events? 

Ms. HOFFMAN. So, the Department of Energy is looking at all 

hazards, including extreme weather, as we look at investment opportunities or research opportunities for advancing our electric 

grid. And so, a lot of our research focuses on advanced technologies, 

energy storage capabilities, advanced minigrids or microgrids, as 

they are called. We are looking at advanced capabilities that the 

utility industry can build and invest in for hardening and improving the infrastructure. 

Mr. DOYLE. Yes, I mean, exactly. In fact, that article goes on to 

detail the SmartGrid R&D Program which is designed to improve 

grid resilience and, also, modernizing the grid through the adaptation and integration of advanced technologies. 

So, in your testimony you explain your recommendation for the 

rebuild as being formed in consultation with the National Labs. 

And a presentation from my NREL earlier this year explained the 

importance of distributed generation, calling it ‘‘a large factor in 

developing resiliency with clean energy technologies and solutions’’. 

So, my question is, is the Department, in making recommendations to those that are helping rebuild the grid in Puerto Rico, 

which will essentially be a brand-new system, are you urging deployment of distributed systems and renewables? 

Ms. HOFFMAN. So, distributed generation, combined heat and 

power, which is probably the most efficient form of distributed generation, is an option that should be considered in any sort of restoration improvement process. But one of the things that we are 

going to have to think about moving forward is how are we going 

to repair systems if another emergency happens. As you look at 

Puerto Rico, which had, I believe, over 8,000 solar panels there, 

what is the process in which the Department of Energy and the 

restoration activities in the next event, how are we going to orchestrate the repair of those systems? 

As you look at an efficient restoration process, there is an advantage to restoring the core electric grid. So, microgrids might a good 

balance between the two of looking at siting generation closer to 

load, but I think it has to be an individual evaluation with respect 

to the state of the system and the opportunities from that point of 

view. 

Mr. DOYLE. Thank you. 

Let me just ask anybody on the panel, does anyone have a comment regarding FEMA’s resistence to authorizing reconstruction 

aid? My understanding is this makes local governments and local 

utilities ineligible for long-term grants. And I am also concerned, 

because Puerto Rico is only eligible for emergency services, that 

these contracts don’t end up following Federal procurement rules 

and we end up with situations like Whitefish Energy. Has any of 

84 

your agencies weighed in on this topic? Is there an expected 

timeline for action on this? Anyone? 

[No response.] 

I mean, FEMA authorized in 10 days in Houston, in Texas, and 

I believe in a couple of weeks in the Virgin Islands. But, yet, still, 

for some reason, this hasn’t been fully authorized. They claim they 

are working on it; they are close to it. Could anyone explain what 

this holdup is and why it has taken so long? 

[No response.] 

I think you are right when someone said we should have had 

FEMA up here. FEMA should be sitting on this panel, too, because 

it seems like a lot of the questions we have need to be answered 

by them. 

Well, let me ask it. Do any panelists have suggestions for any 

highly beneficial action we could take to help expedite the rebuilding efforts in a prudent, sustainable manner? Can you give any 

suggestions to this committee on what we should be doing that we 

are not doing right now? 

Ms. HOFFMAN. Sir, if I may add some comments? 

Mr. DOYLE. I am glad to see Penn State stepping up to the plate 

here and at least answering a question. 

[Laughter.] 

Ms. HOFFMAN. As we look forward to investing in resilience, I 

know it is something that the Administrator of FEMA is looking 

at, as well as the Department. It is, how do we build in resilience 

and how do we think about that upfront investment ahead of a disaster, and looking at what funds are available, to really think 

about investing for resilience? 

Mr. DOYLE. The idea that our citizens are going to go another 

three months without electricity is just unconscionable, I think. 

I yield back. 

Mr. OLSON. The gentleman yields back. 

The Chair now calls upon the gentleman from Ohio, Mr. Johnson, for 5 minutes. 

Mr. JOHNSON. Thank you, Mr. Chairman. 

I appreciate the opportunity to ask of this panel. A very, very important hearing that we are having today because we saw the effects of the hurricanes and how the destruction that occurred during and afterwards, how that affected not only the areas that were 

hit, but other regions of the country as well, since so much of our 

energy resources reside there on the Gulf Coast. 

So, Mr. Corbin, how much does the Northeast Gasoline Supply 

Reserve cost on an annual basis? Let’s get that question out of the 

way first. 

Mr. CORBIN. Thank you for the question, Mr. Johnson. 

For the Northeast Gasoline Supply Reserve, the average storage 

contracts, which are for leased commercial storage for the product, 

are approximately $19.60 per barrel per year. And when you include overhead costs, to include quality assurance and administration of your IT/sales platform, in the event you have to release the 

gasoline, it comes to a little over $20 per barrel per year, sir. 

Mr. JOHNSON. OK. So, is the higher per-barrel cost of storing 

gasoline versus crude oil a good use of taxpayer dollars, do you 

think? 

85 

Mr. CORBIN. That is really not for me to decide, whether that is 

a good use of the taxpayer dollars. 

Mr. JOHNSON. But you have got an opinion? 

Mr. CORBIN. I will say, Mr. Johnson, that in terms of the cost of 

storage for refined products, the United States has, out of 14 countries that participated in benchmarking studies that are stock-holding countries, the U.S. has by far the highest cost for gasoline storage out of the 14 countries. 

Mr. JOHNSON. OK. All right. 

Also, Mr. Corbin, continuing on, the SPR is almost entirely located in the Gulf Coast region of the United States, limiting its 

ability to respond to disruptions in other parts of the country, particularly if we were to have a repeat of what we saw recently. For 

example, the West Coast has relatively few pipelines that are connected to the SPR, meaning that some petroleum products must be 

shipped by truck, barge, or other domestic methods or by tankers 

even from foreign countries. These modes of transport, obviously, 

are slower and more costly and limit the usefulness of the Strategic 

Petroleum Reserve. So, how would expanding, in your opinion, how 

would expanding the number of SPR locations across the country 

enhance the effectiveness of the SPR? 

Mr. CORBIN. First, I would just like to make a correction to your 

statement, sir. There are no pipelines that directly connect the SPR 

to the West Coast of the United States. 

The SPR, as I mentioned in my testimony, our crude oil is stored 

in underground salt caverns in two sites in Texas, two in Louisiana. Salt cavern storage is very inexpensive. We have the lowest 

operating cost of any stock-holding country in the world for our 

crude oil. There are no salt domes along the West Coast of the 

United States. There are some outside of the immediate Gulf Coast 

area, but they are not significant. So, crude oil storage would be 

problematic on the West Coast. 

Mr. JOHNSON. So, you are basically saying—I don’t mean just the 

West Coast; I mean other regions of the country as well. I mean, 

the question centered on the West Coast. So, you are saying, in 

your opinion, developing other storage areas for the SPR around 

the country in different regions would be problematic? 

Mr. CORBIN. For crude oil storage. Now, in discussions that were 

mentioned by Mr. Shimkus earlier, and talked about refined product storage, the U.S. Government currently has two refined products reserves, the Northeast Gasoline Supply Reserve and the 

Northeast Home Heating Oil Reserve. They are both very small, 1 

million barrels apiece. They are intended to meet regional supply 

disruptions. 

There are challenges associated with product reserves, regardless 

of the model that is used. Both of the product reserves that are currently in existence, they are, essentially, Government-owned refined product in leased commercial storage facilities. In any product reserve with that model, there is an initial refined product acquisition cost associated with it. In studies that we did in PADD 

5, which is the West Coast, and in the Southeast U.S., my staff 

found that there is little to no spare commercial storage capacity. 

And as I mentioned previously, the leased commercial storage costs 

are high. 

86 

Mr. JOHNSON. OK. All right. 

Mr. Chairman, I yield back. 

Mr. OLSON. The gentleman yields back. 

The Chair now calls upon the gentlelady from Florida, Ms. Castor, for 5 minutes. 

Ms. CASTOR. Thank you, Mr. Chairman. And I want to thank 

Chairman Upton and Ranking Member Rush, and the professional 

staff, for bringing this hearing to be. And thanks to all of our witnesses. 

There is a very serious tension that the Congress has to address 

as soon as possible. On the one hand, we need to restore power in 

Puerto Rico and the U.S. Virgin Islands as quickly as possible, but, 

on the other hand, Congress has an overarching responsibility to 

protect the taxpayer from future losses by building a more resilient, modern, distributed grid with better technology, technology, 

by the way, that has largely been funded by the taxpayers that we 

see in our National Laboratories that is used by utilities and businesses all across the country. 

Senator Ramon Luis Nieves, who is in the audience and is going 

to testify on the next panel, is a former chairman of the Puerto 

Rican Senate Committee on Energy. He says the current grid is obsolete, the grid before the storm, before the hurricanes. He said in 

his testimony, ‘‘Appropriating taxpayer money just to repair an old 

20th century grid would be a waste of resources.’’ In fact, Ken 

Buell, the Director of Emergency Response and Recovery with the 

U.S. Department of Energy, stated that, ‘‘We really should think in 

terms of rebuilding at this point, not just repairing the old grid.’’ 

The problem that we have all got to grapple with is PREPA is 

largely in debt. They do not have the wherewithal now to take the 

lead on this. They have governance problems. Gosh, what else do 

we have to know after this Whitefish contract controversy? I think 

we have a very significant responsibility to protect the taxpayers 

here. 

A few weeks ago, there was a congressional briefing provided by 

the Department of Homeland Security, FEMA, and the U.S. Army 

Corps of Engineers was there. They also relayed that they only 

have the authority now to go in and make repairs, and not do the 

kind of rebuilding of a modern grid that needs to happen. 

In fact, Mr. Alexander, in your testimony you say that your mission right now is to repair the power system to its prestorm condition, is that correct? 

Mr. ALEXANDER. Yes, ma’am. 

Ms. CASTOR. Ms. Hoffman, what kind of direction do you need 

from the Congress to begin to go beyond a planning stage and do 

something that your very own Director of Emergency Response and 

Recovery has said needs to be done? And do you agree that you 

need that authority to go beyond repairing? 

Ms. HOFFMAN. So, I think there has to be an ability for the Department of Energy to work closely with PREPA in planning and 

actively engaging and discussing what some of those advanced 

technologies solutions are. So, the forum has to be codified, so that 

there can be active engagement and discussion of what are the opportunities. I know that PREPA has their own plans and their own 

87 

activities, but how do we really take the advancements and provide 

that? 

Ms. CASTOR. So, you think, yes, it would be helpful for Congress 

to provide additional clarity, so that you can move forward to do 

what, on a bipartisan basis, what experts have advised that needs 

to be done in Puerto Rico? 

Ms. HOFFMAN. Yes. 

Ms. CASTOR. And the Virgin Islands? OK. 

Ms. HOFFMAN. Yes. 

Ms. CASTOR. We have got to do this with a sense of urgency, 

though. Mr. Alexander, how do we do this? As you keep going on 

to repair, what kind of advice, what kind of clarity do you need 

from the Congress in maybe the next emergency aid package, 

maybe in something that would allow you to go beyond just repairing the old, obsolete grid and moving forward on something that 

would protect the taxpayers? 

Mr. ALEXANDER. So, while we recognize that the prestorm grid 

was not in good condition, the current authorities under the Stafford Act, and the mission assigned from FEMA, limits us to restoring to prestorm condition, meaning U.S. Code. I think this is, ultimately, a policy decision. Do we need to relook at the Stafford Act? 

As written, it was—— 

Ms. CASTOR. And Colleagues, let me—thank you very much—in 

previous emergency aid packages for Superstorm Sandy and for 

Katrina, it has been the Congress that has been able to go beyond 

the Stafford Act that limits the Government to just going and repairing what was, and building in, instead, a new resiliency, 

whether it is in housing or defense installations and things like 

that, those previous emergency aid package. We have never had a 

blackout and destruction of an electric grid the scale of this ever 

before in the country, and that is why this is something new this 

committee needs to work on together with our colleagues in the 

Senate and, hopefully, with DOE, as they have expressed they are 

already doing some of this planning. But, to put this into action, 

it is going to be our responsibility to actually pass that authorization in the next emergency aid package or before. 

And I yield back my time. 

Mr. OLSON. My friend’s time has expired. 

The Chair now calls upon the gentleman from the Commonwealth of Virginia, Mr. Griffith, for 5 minutes. 

Mr. GRIFFITH. Thank you very much, Mr. Chairman. I appreciate 

it, 

Ms. Hoffman, during a hearing before this committee, Secretary 

Perry mentioned that microgrids could be a solution to quickly restore electricity after future natural disasters. I am also interested 

in how microgrid technology could be used to provide power to 

rural and rural mountainous areas of the country. Do you believe 

Puerto Rico could benefit from microgrids and, if so, how? 

Ms. HOFFMAN. So, thank you very much for the question. 

Microgrids provide an opportunity to bring generation closer to 

the load and be able to manage supply and demand on a more local 

basis. In Puerto Rico you have the generation on one side of the 

island and, of course, the load on the other side of the island. So, 

ultimately, you really would like to be able to create a minigrid or 

88 

a microgrid. It would be able to balance that in a different form. 

But that does require generation, and it does require load management and advanced communications and controls to be able to 

manage that on a more localized basis. So, you look at things such 

as energy storage and other generation that can be meshed very 

well with a local distribution system. 

Mr. GRIFFITH. Now would you see that as exclusive of the current 

type of system or would you see it as an ancillary except in times 

of disaster? 

Ms. HOFFMAN. So, ideally, I would love to think about how you 

build off of the existing system and capitalize on the existing investment, where it is electrically feasible. And then, once again, 

that requires close coordination with the existing infrastructure. 

Whenever utilities look at isolation or separation of the grid and 

look at microgrids, they are looking at utilizing the existing assets 

and being able to build upon those assets with new technology and 

new capabilities. 

Mr. GRIFFITH. And if you are suddenly cut off, as we have seen 

in Puerto Rico, from your supply of either electricity or the fuel to 

produce that electricity, doesn’t that require that the microgrid also 

have some kind of a fuel source that it can tap into in cases of 

emergency? 

Ms. HOFFMAN. Absolutely. You need a fuel source. You need redundancy. You need to be able to ensure reliability of the 

microgrid. Whether it is a utility-owned or a private-sector-owned, 

you have to have that redundancy and capability for your customers. 

Mr. GRIFFITH. I appreciate that. 

What are the current limitations associated with the microgrid 

technology, if any? 

Ms. HOFFMAN. So, some of the current limitations are really looking at microgrid controllers to be able to have an ability from a 

standards form to be able to look at control of the microgrid, looking at cybersecurity. Regardless of who owns the electric grid and 

how the electric grid is developed, you have to be secure. You also 

have to have the capability to dynamically manage supply and demand. So, looking at some of the advanced control solutions and 

things along those lines, as well as the generation technology. 

Mr. GRIFFITH. Now let me ask you this: can you envision that a 

microgrid might be as small as, say, just a power source that would 

handle a hospital and its needs or a factor and its needs for short 

periods of time, as a part of the system as a whole, but, then, also, 

in times of emergency be able to take care of those needs where 

we have seen problems in Puerto Rico and other places? 

Ms. HOFFMAN. So, absolutely. We have seen microgrids at university campuses, at hospitals. So, it can be as small as one wants 

to define a microgrid, but also can be larger from a minigrid point 

of view, if you want to support multiple services in a locality. 

Mr. GRIFFITH. And I would assume that, based on what we have 

already discussed, that if you had, if for some reason in the natural 

disaster your fuel source was damaged, but the rest of the equipment was still good, that it would be easier to drop in the fuel, for 

the Federal Government to come in after the disaster and drop in 

89 

the fuel than it would if you drop in a whole new system, isn’t that 

correct? 

Ms. HOFFMAN. I think that has to be evaluated on a system 

basis, to be fair. 

Mr. GRIFFITH. OK. 

Ms. HOFFMAN. I mean, you are bringing in a lot of fuel, and it 

kind of comes down to what really is it required for a cost-effective 

restoration. What we are talking about is getting the power back 

on for as many customers as possible as efficiently and as effectively as possible. And so, in some cases that may be putting in, 

re-establishing a grid system and a grid network. In other cases in 

a localized community that is very far and isolated, it may be putting onsite generation there and creating a minigrid in the near 

term until lines and power can be restored from a main grid point 

of view. 

Mr. GRIFFITH. And I appreciate that. Of course, in my neck of the 

woods where we have a lot of coal and some natural gas, but a lot 

of coal, we think that might be an answer for us, and maybe for 

others, to have that fuel source available and have the big 

microgrid ready to go. 

With that, Mr. Chairman, I appreciate it very much and yield 

back. 

Mr. OLSON. The gentleman yields back. 

The Chair now calls upon the gentleman from Iowa, Mr. 

Loebsack, for 5 minutes. 

Mr. LOEBSACK. Thank you, Mr. Chair. 

Thanks to the panel today for your excellent testimony, and we 

have had a lot of great questions. 

I guess I want to join in with everyone else in expressing the fact 

that I was heartbroken by the devastation of these most recent 

storms. I think it is unfortunate that we are probably going to see 

a lot more of this down the road. So, we are going to be faced with 

these issues, I think, across the country. 

And many of us represent districts that have already been affected over the years by this kind of devastation. I represented 

Cedar Rapids, Iowa, for 6 years. Back in 2008, we had the Flood 

of the Century or the flood of whatever number of centuries, and 

the river crested at 31 feet, 9 feet over the previous record. There 

was $2.5 billion damage done immediately in Cedar Rapids, the 

economic loss of probably the same. And they have been through 

a lot, like a lot of communities around this country, and just most 

recently what we have seen in Puerto Rico and Texas and Florida. 

I do want to, I guess, address my concerns more to Mr. Alexander than anybody with respect to the Corps. You know, the 

Corps I know ranks the projects, and we are going to have a lot 

of projects coming up, what we have seen recently, projects for reconstruction, for flood mitigation. I run the benefit/cost ratio, and 

it has to be at least 1-to-1, as you know. 

Cedar Rapids was 1.2-to-1. We authorized the project to go forward in 2014, but we haven’t seen any movement on it in terms 

of funding. And this is going to happen in these other instances, 

too. We are going to have a lot of challenges, sort of where to 

prioritize, where to put the money. 

90 

But I have a lot of concerns with this benefit/cost ratio. It seems 

awfully bureaucratic to the folks who are living in these communities when they want to prevent floods in the future. Can you address that issue and give us any hope at all that, not just Cedar 

Rapids, Iowa, but these communities that are going to be faced 

with flood mitigation down the road might get some relief and actually see some projects built? 

Mr. ALEXANDER. Sir, I am familiar with benefit/cost ratios and 

prioritizing and racking and stacking of projects, and the needs are 

many, but the budget is limited. But my focus is on contingency operations. And so, to adequately address your question, I would have 

to refer to our Civil Works personnel. So, I could have my staff coordinate with them. 

Mr. LOEBSACK. Yes, I suspected that might be the case, but I am 

going to go ahead and submit a question on the last. Then, if you 

can get us an answer from the relevant person at the Corps, that 

would be great. Again, I just want to bring up this issue more than 

anything else, because going forward this is going to cost, as we 

know, billions of dollars for reconstruction in these communities. 

And a lot of them are going to face the same questions that Cedar 

Rapids faced since 2008, and a lot of other communities around the 

country, and it is something that we are going to have to pay close 

attention to and we are going to have to resolve that issue, because 

folks are going to be depending upon those reconstruction funds to 

make sure that they can go forward with their communities. 

So, thanks to all of you. 

And thank you, Mr. Chairman. With that, I will yield back. 

Mr. OLSON. The gentleman yields back. 

The Chair now calls upon the patient gentleman from West Virginia, Mr. McKinley, for 5 minutes. 

Mr. MCKINLEY. Very patient, very patient. Thank you, Mr. 

Chairman. 

Mr. OLSON. Very patient. 

Mr. MCKINLEY. Mr. Chairman, given the aftermath and all the 

discussion here we have had about the natural disasters we have 

had in Florida, Texas, Louisiana, Puerto Rico, I really want to applaud the Department of Energy’s efforts to refocus the narrative 

and the discussion about reliability and resiliency, because really 

it underscored how serious that problem is if we don’t address it. 

So, thank you for what you are doing, and for Secretary Perry, for 

focusing on that, because I think that could have some impact. 

But my question, a little along the same line, has to do with the 

petrochemical industry in the Houston and Louisiana, all of the 

Gulf Coast, where we were so hard hit when that Category 4 hit 

there that it wiped out or shut down 17—I think there are 23 

crackers down in that area—17 of them were shut down. One of 

them is still out. Sixty percent of our production of polyethylene 

and propylene were lost for a period of time. It showed how vulnerable we are in that area. 

And I know that, in contact with folks that have reached our office, because of that slowdown, because of the lack of cracker facilities to be able to provide the ethylene and propylene around the 

country, companies all across America that use their plastic resins 

are slowing down as a result. One company, particularly, in my disVerDate Mar 15 2010 12:53 Mar 12, 2018 Jkt 037690 PO 00000 Frm 00094 Fmt 6633 Sfmt 6633 C:\USERS\WLAUFERT\DESKTOP\115X72X2017HURRICANESWORKING WAYNE
91 

trict was working seven days a week. It is now down to five because it can’t get the plastics. 

So, this thing is serious about it. What we have done, or what 

I think DOE maybe has an interest—and I would like to hear more 

from you—is that, rather than taking a page from the Strategic Petroleum Reserve of having it all in one location, what if we were 

to locate an ethane storage up in the northern Appalachian area, 

right where the Marcellus and the Utica shale formations are located, so that we could have a secondary supply, a secondary 

source, to be able to provide that, the petrochemical supplies of material for around the country? 

Do you have a thought about that from DOE’s position, here they 

may be on having a secondary? It is not replacing Houston by any 

stretch. It is just having something that is in another location, so 

it is not vulnerable to the weather. 

Ms. HOFFMAN. So, Congressman, you bring up an important 

issue. It is location, location, location. Diversity is very important. 

And as we look at any sort of, whether it is fuel product, chemical 

product, having and thinking about having flexibility in where that 

product is developed also looks at our security and resilience for 

the Nation. So, I understand that in the Appalachian area there is 

a lot of natural gas resources and a byproduct of natural gas and 

the ability is ethane. And so, I know that the Secretary had a 

roundtable discussion and is looking at the opportunity. But it 

brings up the important point that we need to think about diversity 

and I wanted to say ‘‘generation diversity,’’ but product diversity in 

the United States. 

Mr. MCKINLEY. Following up on that is that, during last year’s 

appropriation process, our office had introduced an amendment to 

the appropriation bill to see that a study was undertaken to confirm whether or not there was an interest or possibility and potential for having it in the Marcellus and the Utica shale formations. 

That has been since, I think it was May. Do you have a sense? Can 

you give me a status on how far along, if it has been undertaken 

yet, to make a determination of the feasibility of locating a secondary ethane storage? 

Ms. HOFFMAN. So, I understand the Department is undertaking 

a study in this area, and it is my understanding that this study 

will be completed in 2018. 

Mr. MCKINLEY. Do you have an idea when in 2018? In December 

or is that going to be in September or October? 

Ms. HOFFMAN. I don’t have that. 

Mr. MCKINLEY. OK. 

Ms. HOFFMAN. I will get back to you on that answer. 

Mr. MCKINLEY. If you could back to me, I would appreciate it. 

And I yield back. Thank you. 

Mr. OLSON. The gentleman yields back. 

The Chair now calls upon the gentleman from the Bay State, the 

Bay Line State—I’m sorry—the Old Line State, Mr. Sarbanes, for 

5 minutes. I apologize. 

Mr. SARBANES. All those names work. 

Thanks to the panel. 

I wanted to ask you, Mr. Alexander, to step back in terms of the 

Corps’ relationship to these disasters that have been occurring with 

92 

more frequency, and give me a sense of how much the Corps’ mission and effort and sort of the deployment of its various projects 

has changed over the last few years in either response to the disasters that we are seeing, these natural disasters, or in anticipation 

that the frequency of them is going to increase. Is that an analysis 

that is happening? Can you cite some trends in terms of the Corps’ 

projects around this, the kind of requests that come in that are related to resiliency and adaptation, and so forth, in addition to just 

efforts to respond to things that happen? So, if you could give that 

kind of 30,000-foot perspective, that would be helpful. 

Mr. ALEXANDER. Thank you, sir. 

First, every year following a storm season, we do an after-action 

review and we identify lessons learned, and we work to develop 

and establish best practices, so that we can improve ourselves and 

train accordingly. How can we work with State and local governments to help them prevent and work toward mitigation of a disaster? 

We are always looking at how we can improve our critical infrastructure. We have an aging infrastructure, as you know. So, that 

is a separate issue. We acknowledge that infrastructure needs to 

be resilient in order to withstand storms such as this, flooding on 

the Mississippi, tornadoes out in the Midwest. We are looking, as 

we move forward and develop and study projects and future 

projects, we are looking at ways to ensure that a greater degree of 

resilience is incorporated in those designs. 

Mr. SARBANES. Are you seeing an increase? Is there a marked increase or at least something measurable in the kinds of proposals 

that are coming into the Corps that relate to these extreme weather events, either responding to something that has happened or 

projects that are anticipating increased exposure from these 

events? And has the Corps’ kind of scoring system for projects been 

adjusted in any way relative to what has been happening with 

these kinds of disasters and weather events? 

Mr. ALEXANDER. I am not in a position to adequately address 

your question. I can say, I mean, we do every year; we have requests for additional flood damage mitigation projects. How can we 

increase the resilience in levee systems and support and mitigate 

flooding in low-lying areas, flood plains, things of that nature? 

Mr. SARBANES. I would appreciate it, if it were possible, to go 

back to the Corps, and maybe after the analysis following this hurricane season has been completed, to see if you could give us some 

information about trends over the last few years in terms of the 

number of projects that fall into that kind of a basket and, as I 

said, whether the Corps is putting that analysis and thinking into 

a strategic plan for the Corps going forward that may lead to creating different sets of priorities for project based on some of these 

issues. So, if that is something, certainly getting that analysis—I 

assume we can get some report on the analysis that is done on an 

annual basis—that would be helpful, but, then, any additional perspective you can bring on those kinds of trends would be helpful. 

Mr. ALEXANDER. Yes, sir, we will. 

Mr. SARBANES. Thanks. I yield back. 

Mr. OLSON. The gentleman yields back. 

93 

The Chair now calls upon the gentleman from Missouri, Mr. 

Long, for 5 minutes. Welcome back, Billy. 

Mr. LONG. Thank you, Mr. Chairman. 

And, Ms. Hoffman, 10 or so years ago, my hometown of Springfield, Missouri, we received a devastating ice storm where there 

were folks out of power for 10, 12 days, two weeks, whatever, and 

the utility companies came in from all over to help us in that situation. I know the recent situation in Florida, from the Washington, 

DC, area here in Maryland, Virginia, and Springfield, Missouri, 

again sent crews down to Florida to help in that situation. So, I 

know what it is like whenever people—neighbors helping neighbors, so to speak. 

You note in your testimony that mutual assistance provided by 

electric companies, public utilities, and electric cooperatives across 

the country played an important role in restoring power so quickly 

in Florida. Could you discuss the logistics of bringing in as many 

as 60,000 workers from across the country to quickly assess and restore, or assess restoration locations, and how this effort is being 

coordinated by industry? 

Ms. HOFFMAN. So, thank you very much for the question. And I 

think it is an impressive network, and the aggressive posture that 

the utility industry has had, as well as the lessons learned from 

Katrina and past events, that the utilities have really taken it 

upon themselves to have a leadership position in developing a mutual assistance network. This is a network where utilities talk 

among each other, request mutual assistance, and it is organized 

to provide mutual assistance to utilities that request it. And this 

is across the United States. There is different coordination and different entities that are responsible for a mutual assistance request 

in different areas of the country. 

The utilities that provide mutual assistance, they talk about the 

management structure; they talk about laydown procedures with 

respect to equipment and equipment necessary. And there is a 

huge coordination with respect to supplies and the availability of 

resources. 

Mr. LONG. OK. What role do State or Federal emergency operations officials have in monitoring the use of mutual assistance and 

to ensure that it is applied to the most critical areas? 

Ms. HOFFMAN. So, this is real interesting, and I thank you for 

bringing up the point. What we deal with is, first and foremost, the 

utilities are in a leadership position, as they should be, for providing response and recovery. The Federal agency and the Federal 

Government and the Department of Energy, what we do is help understand when is it outside the ability of a utility to be able to 

manage their response and recovery efforts, and what are the resources that are required, the gaps that are needed in providing 

support. So, whether it is transportation issues, access issues. And 

so, that is the activities that the Department of Energy and the 

Federal Government help with. And that is whether it is hours of 

service waivers, whether it is weight restriction waivers, whether 

it is understanding if there is a priority, whether it is a heavy load 

like a chemical facility or a pharmaceutical or a hospital, what 

some of those restoration needs are. 

94 

Mr. LONG. Speaking of the Federal Government, what does the 

Federal Government do to remove regulatory roadblocks to recovery and repair efforts, and are there areas that we can improve in 

those? 

Ms. HOFFMAN. So, the efforts that the Federal Government does 

and looks at are from a waiver point of view. So, looking at access 

to any sort of damaged area, to making sure that the utilities—I 

guess where I would go with this answer is I will be very pointed 

here. It is that utilities nowadays are very much seen as emergency 

responders. Typically, that has been the health and the safety side 

of things. But now, as you look at critical infrastructure and as you 

look at the needs moving forward, telecommunications and electricity are primary for providing an effective restoration process 

and life and safety. And so, access for utilities in a damaged infrastructure environment, being able to be forward-leaning in getting 

utility resources there, are absolutely critical as we move forward. 

And it is going to be more critical as we look at onsite generation 

and being able to restore power. 

Mr. LONG. OK. Thank you. 

And will the Department of Energy be working with the States 

and Territories impacted by these recent hurricanes to assess grid 

resiliency efforts and identify ways to improve grid resiliency? 

Ms. HOFFMAN. Yes. 

Mr. LONG. OK. I wish we had time today for an EMP discussion 

with all of you, but perhaps another day. It seems like our time is 

taken up today with talking about the Astros all the time. 

Mr. Chairman, I yield back. 

Ms. HOFFMAN. I look forward to future conversations on that. 

Mr. OLSON. The conversation is a problem, my friend, about the 

Astros? Is that a big problem? 

The gentleman yields back. 

The Chair now calls upon the gentleman from New York 20, including the State capital of Albany, Mr. Tonko, for 5 minutes. 

Mr. TONKO. Thank you, Mr. Chair. 

While we hear about restoration working along in some of our 

States, many of our fellow Americans in Puerto Rico and the 

United States Virgin Islands remain in the middle of the most serious blackout in United States history. Restoring services is absolutely critical, but we also need to acknowledge the risks of this 

happening again and the need to support the development of a 

more resilient grid moving forward. 

Over the last decade, extreme weather and fire events have cost 

the Federal Government well over $350 billion, according to the Office of Management and Budget. A GAO report last week estimated 

that these costs will likely rise in the future, due to the effects of 

climate change. This is not a choice between pay now or pay later. 

It is a pay now by supporting research, hardening infrastructure, 

and making meaningful investments to adapt to and mitigate climate change, or pay now in multibillion-dollar emergency spending 

packages. The fiscally sensible approach is to acknowledge the risk 

posed by extreme weather and to make the necessary investments 

that will mitigate it. 

We just passed the 5-year anniversary of Superstorm Sandy hitting the Northeast. We have seen a lot of effort in New York to 

95 

build a more resilient grid, but the experience of Sandy shows that 

rebuilding takes time. And it is clear that lessons learned from one 

disaster can make future response and recovery more effective. We 

have been learning from Sandy. We are learning from Harvey, from 

Irma, and from Maria, and the learning will continue until we address some of the preventative measures. 

So, Ms. Hoffman, your testimony mentioned that Florida Power 

& Light has made major investments since 2006 to build a more 

storm-resilient grid. Similar work has been done in New York State 

in regard to Sandy. How can a smarter, modernized grid be more 

resilient? 

Ms. HOFFMAN. So, thank you, Congressman, for the question. 

A smarter grid allows for advanced communications and controls. 

It allows for rerouting power. It allows for an accelerated situational awareness. 

So, let’s first talk situational awareness and the ability to have 

smart meters and you are able to have better visibility into your 

system, be able to isolate damage, be able to reroute power. And 

so, having that ability allows you to be forward-leaning on placement of resources, to have a very effective restoration process, wellplanned, well-distributed with respect to priorities and how a restoration process can be done. 

With respect to being able to reroute power, you can really look 

at isolating customers and being able to make sure that you can 

restore most of, a large number of customers quickly, as well as 

prevent damage to additional customers unnecessarily. 

Mr. TONKO. Thank you. 

And, Ms. Walker, can you explain how grid modernization efforts 

in Texas, advanced meters, and others, aided in a more rapid recovery there? 

Ms. WALKER. Yes, sir. Thank you for the question. 

The advanced meter systems that we have—we have them 

through most of the ERCOT region—were very helpful. It notified 

the utilities of when those customers were out. So, they knew 

where those customers were located. It also helped, as Ms. Hoffman said, in rerouting and knowing where they needed to send 

their crews, and being able to reroute electricity to serve people in 

a more timely fashion. So, we found that it was very helpful to 

have the advanced meter systems and the new technologies. 

Mr. TONKO. Thank you. 

And DOE’s quadrennial energy review heavily focused on critical 

infrastructure interdependencies. I am particularly concerned by 

the harrowing statistics of Puerto Ricans without access to safe 

drinking water. Water, telecommunications, hospital, and public 

safety infrastructure are dependent on electricity. 

So, Ms. Hoffman, is a more resilient grid system, perhaps one 

that includes microgrids, distributed generation, and storage, important for supporting rapid response and recovery in regard to 

and in interaction with these other critical infrastructure needs? 

Ms. HOFFMAN. So, thank you, Congressman. 

Using a microgrid in a smart fashion around critical infrastructure is absolutely important. As you look at telecommunications, as 

you look at water and wastewater treatment plants, it is really how 

do we harden those areas to allow for them to either sustain or be 

96 

able to recover quickly. And having generation closer to these critical loads, through the form of a microgrid, is absolutely important. 

I know that ConEd and areas in New York are also looking at how 

do they harden their infrastructure. 

And I do want to say I appreciate NIPA and their efforts in going 

down to Puerto Rico as well and supporting the recovery efforts. 

Mr. TONKO. Thank you. 

Has there been any interaction with EPA and DOE in regard to 

this interdependency on infrastructure? 

Ms. HOFFMAN. Sorry, you said EPA? 

Mr. TONKO. Yes. Any efforts with drinking water, DOE, and the 

infrastructure, the electric utility? 

Ms. HOFFMAN. Thank you very much. I understand. 

Through the Electric Sector Coordinating Council and through 

our responsibility as a sector-specific agency, we have had coordination discussions with the telecommunication sectors and some of 

the other critical infrastructure sectors to think about how do we 

really move forward from a restoration process, from a hardening 

process, from an advanced technology process, from a coordination 

process, and moving forward and strengthening our economy. 

Mr. TONKO. Thank you so much. 

Mr. Chair, I yield back. And congratulations. 

Mr. OLSON. Thank you. The gentleman’s time has expired. 

The Chair now calls upon the gentleman from Florida, Mr. Bilirakis, for 5 minutes. 

Mr. BILIRAKIS. Thank you, Mr. Chairman. Thanks for allowing 

me to sit on the committee. 

And then, also, I want to congratulate you on the Astros’ victory. 

They are a model. They really accomplished quite a bit this year, 

and I like the way they rebuilt their team. 

So, anyway, can I have an extra 2 minutes because of that? 

Mr. OLSON. As long as you want to talk like that, you can have 

10 minutes. 

[Laughter.] 

Mr. BILIRAKIS. All right, but I am going to root for another team 

next year. You know that. 

But, in any case, I wanted to talk about—Ms. Walker, if I can 

ask you a couple of questions? I understand that there is a site 

prioritization when utilities are being restored and in the midst of 

a response resources are often spread thin. If there are two hospitals—this is a question—if there are two hospitals in a given 

area, how do utilities determine which facility is responded to first? 

Ms. WALKER. Well, in Texas the hospitals by statute are required 

to have backup generation. So, they do have that requirement. I 

am not sure how they are decided which one they respond to first. 

I know that for CenterPoint Energy during Hurricane Ike that that 

was the first areas that the company went to, was to the hospitals. 

So that all of the personnel were trying to restore service to those. 

So, I am not for sure and I would have to look into how they would 

decide between two. 

Mr. BILIRAKIS. Thank you. 

What role do utility companies play in crafting a State’s disaster 

response plan and determining which sites are prioritized? 

97 

Ms. WALKER. They have complete power to come up with their 

plan on how to restore power. The Commission does have levels 

that we ask them to look at, which are the critical structures such 

as hospitals. By statute, they also have to respond to nursing 

homes. We clearly have them respond to refineries and things in 

the ship channel. So, there is a tier, but the utilities are responsible for setting their own priorities. 

Mr. BILIRAKIS. Thank you. 

How much flexibility does a utility company have in determining 

which sites are restored first? 

Ms. WALKER. They have a lot in Texas. They do work, and Texas 

recovery is at the local level, so they do work also with their counties and their cities to make those determinations. But the utilities 

in Texas have a significant amount of determination on how they 

restore power. 

Mr. BILIRAKIS. Thank you. 

The next question to the panel, what challenges still exist for 

Florida and what are your post-storm recommendations? What 

DOE resources are available to the communities like mine impacted by Irma? Who would like to being first? 

Ms. HOFFMAN. I will start. Florida had a very effective restoration process. They had the arrangements from a mutual assistance 

point of view. They looked at, and their investments in the infrastructure have helped with, hardening their systems. Their advanced control and metering has advanced their capabilities. At 

this stage in the game, Florida really looked at their codes and 

standards from a perspective of a Category 3 hurricane. As we are 

looking at Category 4 hurricanes and additional hurricanes, I think 

now it comes down to, what are some of the additional new capabilities to mitigate a Category 4 and higher-level hurricanes that 

they are going to have to consider? 

I think from a fuel distribution point of view, that was the one 

area of looking at distributing fuel. Gasoline was a challenge in 

Florida, but I think it was also partly that the necessary evacuation that occurred had a run-on on gasoline stations. And so, it 

looks at, they did advance by having generation hookup. So, from 

an electrical point of view, they advanced capabilities there. But if 

I had one area, it is probably look at the distribution network with 

respect to gasoline. 

Mr. BILIRAKIS. The fuel issue, yes, definitely. We were very fortunate in the Tampa Bay area, I think as you know, to dodge the 

Category 3 or 4, but God forbid we have one. 

So, anyone else want to comment? I don’t have much time. I 

know I asked for an additional couple, but I was just kidding. But 

does anyone else want to comment on that? Any suggestions? 

[No response.] 

That is great input. I really appreciate that. 

Thank you very much, Mr. Chairman. I yield back. 

Mr. OLSON. The gentleman is always welcome here. He yields 

back. 

The Chair now calls upon the man who is working very hard for 

a bipartisan agreement to allow me to wear this jersey on the 

House floor later today, Gene Green from Houston, Texas, 5 minutes. 

98 

[Laughter.] 

Mr. GREEN. I thank my colleague and neighbor for yielding to 

me. 

For our colleague from Florida, I know there were some problems 

with gasoline supplies there, and maybe you can tell me, does Florida import all your gasoline and diesel? I didn’t know if you had 

any refineries in Florida. OK. Well, that is OK because we want 

to keep selling you the stuff we produce in Texas and Louisiana. 

But, anyway, being a native Houstonian and going through lots 

of storms and hurricanes over the years, Harvey was probably the 

toughest, even compared to Hurricane Carla who hit us in 1960, 

1961. But every 8 years we have a tropical storm or a hurricane. 

In 2008, we had Hurricane Ike, which damaged our infrastructure 

because it was a wind storm, the storm surge, but the wind. By the 

time Harvey got to Harris County, it was mostly rain. And our biggest problem was typically so much rain that it overflowed a lot of 

our sanitary sewer systems in the west side of Houston, and even 

Houston facilities and our smaller cities and how that did. 

But, somewhere along the way when we have these thousandyear storms that are happening so often, and the average rainfall 

in Houston is 49 inches a year and you get 52 inches in five days, 

I don’t know how we can deal with it. We just have to dig more 

reservoirs, spend more money to contain that water, because water 

is a precious commodity and we need to do it, instead of letting it 

go into the Gulf of Mexico. 

This is the first storm that I have had where I have had fatalities in our district. We lost eight people in our district. Two of them 

were breadwinners in their family, because they thought they could 

go through this high water in an underpass. 

But the sad one was that we lost a family of six in our district 

on Greens Bayou, northeast Houston. The bayou, we have been 

working on it for decades to build detention ponds upstream, but 

the family turned off into the bayou, literally, because they thought 

it was the road. And it was widely publicized the family was missing, but we didn’t find them until after the water went down down 

in Greens Bayou, northeast Harris County. 

But, as far as for the utilities, we didn’t have that big a problem. 

But, as we are sitting here, we will get another hurricane or a tropical storm. And so, that is what I am concerned about. 

It is important we try to learn from these lessons of these 

storms. We are in the middle now of building back houses, shops, 

and communities, but we know we have to do better on the flood 

infrastructure, both working with the Corps of Engineers and in 

Harris County. We have a Harris County Flood Control District. 

We tax ourselves to keep from flooding in Harris County, so we can 

partner with the Corps. But it is essential that we fund the Corps 

of Engineers, FEMA, and other related agencies in our next supplemental. 

I am concerned about Puerto Rico because their electric grid was 

in pretty bad shape even before. And some of us were talking on 

the Energy Subcommittee a week ago about this may give us the 

opportunity for the United States to actually provide an electric 

system in Puerto Rico, because I understand they are still burning 

fuel oil. 

99 

Again, coming from Texas, we can put all the windmills up and 

all the solar, which you can’t get wind and solar. We would be glad 

to have an LNG export/import facility there, because, one, it would 

be much cleaner than fuel oil. It would probably be cheaper, too, 

because the price of natural gas is relatively cheap. 

I would just like to ask—like I said, I have driven around Puerto 

Rico, but I don’t live there and I don’t represent it, but I know they 

need help in getting literally the whole grid back up. Is that something that we could look at through the Department of Energy to 

see if we could redo the grid in Puerto Rico to where it would be 

brought up to what we would consider standards? 

Ms. HOFFMAN. I think it is an opportunity to look at all technologies and different solutions for investment in Puerto Rico, and 

looking at how we can harden the system. But everything should 

be on the table of what advancements can be done with respect to 

their energy infrastructure. Forty-seven percent of Puerto Rico 

electricity comes from petroleum, 34 percent from natural gas, 17 

percent from coal, and 2 percent of renewable energy. And so, there 

is a lot of opportunities to think about the generation mix as well 

as the location of generation, and the use of the transmission and 

distribution system, as well as demand/response and customer engagement. 

Mr. GREEN. Yes. Well, I know in Texas we have had success with 

the wind power, not only in west Texas, but south Texas, and it 

gives us that type of opportunity to have a different fuel supply, 

although it is hard today to heat with low-price natural gas. That 

is why some of our coal plants are problems. 

Ms. Walker, in your testimony you said that the PUCT’s initial 

assessment of the Texas utilities is that they did an outstanding 

job of responding to the storm. And I know over the years we have 

had partnerships with other States and other communities, that we 

will send our utility workers up there when they have a problem. 

When there are ice storms in Dallas, we will take care of that. But 

I don’t remember seeing that much in the Houston or southeast 

Texas area. 

Ms. WALKER. Mutual assistance? 

Mr. GREEN. Yes. 

Ms. WALKER. There probably wasn’t that much because the damage was very different and the cause of the outages was very different. Usually, the mutual assistance comes in to repair wind 

damage, the poles going own, the wires going down. Houston and 

Beaumont was flooding. And so, most of that was due to the substations being out. And so, once we were able to get these mobile 

substations in or the waters recede and get those substations back 

up and running, we were able to restore the customers. 

The outages in those areas really weren’t very long-lasting. They 

were more like a thunderstorm. And Houston and CenterPoint Energy and Entergy were continually restoring customers. And so, 

their numbers were very low on an ongoing basis, although they ultimately restored a lot of people. 

Mr. GREEN. And that is why it worries me, because here in Puerto Rico I think they are still only about 30 percent of the power 

that has been restored. So, it is really a case that we need to work 

on. 

100 

So, thank you, Mr. Chairman. I yield back. 

Mr. OLSON. The gentleman’s time has expired. 

Seeing no members seeking to ask questions, the Chair wants to 

thank our five witnesses. Thank you, thank you, thank you for 

coming here today. 

I remind our witnesses that every member can submit questions 

for the record for 10 days. Once you get that, you have 10 days to 

respond. 

Mr. RUSH. Mr. Chairman, I request, I would like to make a statement. 

Mr. OLSON. Yes, sir, you have a minute, Bobby. 

Mr. RUSH. A minute? Thank you, Mr. Chairman. 

Mr. Chairman, I must say, with all due respect, as we conclude 

this panel and are getting ready and prepare to introduce the next 

panel, with all due respect, Mr. Chairman, I simply smell a rat 

here. I really smell a rat. 

PREPA’s lack of response to this subcommittee’s efforts to invite 

them to attend and provide witness testimony to this subcommittee 

is most disgusting and extremely disrespectful. Mr. Chairman, that 

said, I strongly request that we use our subpoena authority to demand that PREPA come to this subcommittee and disclose to Members of Congress who are members of the subcommittee what were 

the facts involved in its awarding this $300 million contract, which 

I call the sweetest of sweetheart deals, to repair and reconstruct 

Puerto Rico’s electrical infrastructure. 

And I also believe, Mr. Chairman, that as has been stated by 

Members of both sides during this panel, that FEMA should also 

be invited to be at the same witness table. Mr. Chairman, we ought 

to get to the bottom of this, and we have got to know what happened, when did it happen, and who is responsible for this absurd 

sweetheart deal that is going to result in numerous people paying 

an extraordinary additional amount of millions of dollars because 

of the delay in the withdrawal of this contract. 

So, I really request that we use our subpoena authority to make 

sure that PREPA stop disrespecting the United States Congress. 

Thank you. I yield back. 

Mr. OLSON. And, my friend, I share your concerns. It sounds 

kind of odd, what happened there, but I will talk to the chair for 

the subcommittee, Mr. Upton, and the full committee, Mr. Walden, 

about the subpoena issue. 

But, right now, a point of personal privilege before the first panel 

leaves, and this is maybe at the risk of offending Ms. Castor. But, 

Commissioner Walker, I hope you are going to SMU Saturday, joining my daughter and my wife to watch SMU beat the tar out of 

Central Florida. 

[Laughter.] 

The panel is dismissed. 

OK. Second panel, are you all ready? And just like before, we will 

start out with opening statements from all of the panelists, followed by questions from members. 

And I recognize Thomas Fanning. Tom is the President and CEO 

of Southern Company. He is here on behalf of the Electricity Subsector Coordinating Council. 

Tom, you have 5 minutes for an opening statement. 

101 

STATEMENTS OF THOMAS A. FANNING, PRESIDENT AND 

CHIEF EXECUTIVE OFFICER, SOUTHERN COMPANY, ON BEHALF OF THE ELECTRICITY SUBSECTOR COORDINATING 

COUNCIL; JULIO A. RHYMER, SR., EXECUTIVE DIRECTOR 

AND CHIEF EXECUTIVE OFFICER, VIRGIN ISLANDS WATER & 

POWER AUTHORITY; CHET THOMPSON, PRESIDENT AND 

CHIEF EXECUTIVE OFFICER, AMERICAN FUEL & PETROCHEMICAL MANUFACTURERS; MAX E. MCBRAYER, JR., 

CHIEF SUPPLY OFFICER AND CHIEF FINANCIAL OFFICER, 

RACETRAC PETROLEUM, INC., ON BEHALF OF THE NATIONAL ASSOCIATION OF CONVENIENCE STORES AND THE 

SOCIETY OF INDEPENDENT GASOLINE MARKETERS OF 

AMERICA; RAMON-LUIS NIEVES, ATTORNEY AT LAW, 

FORMER MEMBER, SENATE OF PUERTO RICO; AND CATHERINE B. KENNEDY, VICE PRESIDENT, NATIONAL NURSES 

UNITED 

STATEMENT OF THOMAS A. FANNING 

Mr. FANNING. Thank you. Thank you for inviting me to testify 

today. 

My name is Tom Fanning. I am the chairman, president, and 

CEO of Southern Company. I am also the immediate past chairman of the Edison Electric Institute, the association that represents all U.S. investor-owned electric companies. However, I am 

addressing you today in my role as one of three co-chairs of the 

Electricity Subsector Coordinating Council. We collaborate closely 

with our colleagues from public power utilities and rural electric 

cooperatives on the ESCC. 

I am pleased to address the subcommittee and to share the steps 

the electric power industry is taking to make energy infrastructure 

smarter and more resilient, allowing us to continue delivering affordable and reliable power. 

The 2017 hurricane season highlights the critical importance of 

cooperation and coordination among electric utility companies, the 

Government, and other key infrastructure industries to ensure fast, 

efficient recovery for customers. 

The electric sector faces constantly-evolving threats to the energy 

grid. The industry’s risk mitigation strategy emphasizes a defensein-depth approach. We focus on preparation, prevention, response, 

and recovery, with an emphasis on the isolation of and enhanced 

protections for critical assets. 

While this hearing is focused on storm response and recovery, it 

is important to note that our companies do not build the energy 

grid or our security responses to meet only one type of threat. We 

must prepare and plan for them all, whether manmade or natural, 

malicious or unintentional, relating to the cyber or physical security, or a combination of threats. 

Weather is an unavoidable part of our business. In the aftermath 

of such events, the industry works to identify gaps, compile lessons 

learned, and disseminate best practices. As an industry, we strive 

to be better today than we were yesterday and to be better tomorrow than we are today. 

Since Superstorm Sandy 5 years ago this week, the electric 

power industry has combined efforts across all segments of the inVerDate Mar 15 2010 12:53 Mar 12, 2018 Jkt 037690 PO 00000 Frm 00105 Fmt 6633 Sfmt 6633 C:\USERS\WLAUFERT\DESKTOP\115X72X2017HURRICANESWORKING WAYNE
102 

dustry and has worked with the Government partners to streamline restoration efforts and to improve preparation for and response 

to major threats that cause significant outages. 

The benefits of this coordination were visible over the past several months as the industry and Federal Government worked to 

prepare for and respond to the hurricanes. There is an understandable urge to compare storms, but the reality is that each storm is 

different. The common threads, however, are the need for resilient 

infrastructure, a plan for response and recovery, and the awesome 

nature of our industry’s ability to respond to emergencies. 

Before I close, I would like to underscore the importance of the 

ESCC. During the most recent storms, the ESCC held daily coordination calls among impacted companies and Government officials 

to address critical operational issues such as identifying specialized 

equipment needs, removing temporary flight restrictions for both 

manned and unmanned aircraft to assist with aerial damage assessments, coordinating how industry could re-enter and access disaster areas, and coordinating response efforts with the oil and natural gas, telecommunications, transportation, and water and wastewater sectors. 

Energy Secretary Rick Perry was on every call and was frequently joined by other officials such as Homeland Security Acting 

Secretary Elaine Duke. These calls were essential to identify and 

address critical issues in the response and recovery efforts. 

The reliability and resiliency of the energy grid are of paramount 

importance. Our customers expect the lights to go on when they 

flip a switch. When the power goes out, our customers expect that 

it will be on soon. 

The electric power sector will continue to strive to meet those expectations through a multilayered strategy, to invest in smart energy infrastructure, continuous enhancement of our industry/Government partnership, and the grit of the amazing men and women 

who make the energy grid work day-in and day-out. 

The subcommittee is showing great leadership with its focus on 

preparedness, and we look forward to working with you on this 

critical topic. 

Thank you again for the opportunity to testify on behalf of the 

ESCC, and I look forward to your questions. 

[The prepared statement of Mr. Fanning follows:] 

103 


The 2017 Hurricane Season: 

A Review of Emergency Response and Energy Infrastructure Recovery Efforts 

Thomas A. Fanning 

Chairman, President, and Chief Executive Officer 

Southern Company 

Testifying on behalf of the 

Electricity Subsector Coordinating Council 

The 2017 hurricane season highlights the critical importance of cooperation and coordination 

among electric companies, the government, and other key infrastructure industries to ensure fast, 

efficient recovery for customers. There is an understandable urge to compare storms, but the 

reality is that each storm is different. The common threads, however, are the need for resilient 

infrastructure, a plan for response and recovery, and the awesome nature of our industry's ability 

to respond to emergencies. 

The electric sector faces constantly evolving threats to the energy grid. The industry's risk 

mitigation strategy emphasizes a "defense-in-depth" approach. We focus on preparation, 

prevention, response, and recovery, with an emphasis on isolation of, and enhanced protections 

for, critical assets. While this hearing is focused on stonn response and recovery, it is important 

to note that our companies do not build the energy grid or our security responses to meet only 

one type of threat. We must prepare and plan for them all, whether manmade or natural, 

malicious or unintentional, relating to cyber or physical security, or a combination of threats. 

Weather is an unavoidable part of our business. In the aftermath of events, the industry works to 

identify gaps, compile lessons learned, and disseminate best practices. As an industry, we strive 

to be better today than we were yesterday, and to be better tomorrow than we are today. 

Since Superstorm Sandy five years ago this week, the electric power industry has combined 

efforts across all segments of the industry and has worked with government partners to 

streamline restoration efforts and to improve preparation for and response to major events that 

cause significant outages. The benefits of this coordination were visible over the past several 

months, as the industry and federal government worked to prepare for and respond to the 

hurricanes. 
104 


Congressional Testimony 

The 2017 Hurricane Season: 

A Review of Emergency Response and Energy Infrastructure Recovery Efforts 

Thomas A. Fanning 

Chairman, President, and Chief Executive Officer, 

Southem Company 

Testifying on behalf of the 

Electricity Subsector Coordinating Council 

Testimony before the 

Subcommittee on Energy 

Committee on Energy and Commerce 

United States !louse of Representatives 

November 2, 2017 

2 
105 


Chairman Upton, Ranking Member Rush, and Members of the Subcommittee, thank you for 

inviting me to testify today. My name is Tom Fanning, and I am the chairman, president, and 

chief executive officer of Southern Company, but I'm appearing before you today in my role as a 

co-chair of the Electricity Subsector Coordinating Council (ESCC). 

I also am the immediate past Chairman of the Edison Electric Institute (EEl). EEl is the 

association that represents all U.S. investor-owned electric companies. EEl's member companies 

provide electricity for 220 million Americans and operate in all 50 states and the District of 

Columbia. 

The electric power industry-which includes EEl's members and the members of the American 

Public Power Association (APPA) and the National Rural Electric Cooperative Association 

(NRECA)-supports more than 7 million American jobs and contributes $880 billion annually to 

U.S. gross domestic product, about 5 percent of the total. APPA, EEl, and NRECA also come 

together to chair the ESCC. I serve as one of three co-chairs of the ESCC; my fellow co-chairs 

arc Duane Highley, President and CEO for Arkansas Electric Cooperative Corp. and Arkansas 

Electric Cooperatives, Inc., and Kevin Wailes, CEO of Lincoln Electric System in Nebraska. 

The ESCC serves as the principal liaison between the electric sector and the federal government 

for coordinating efforts to prepare for, and respond to cybersecurity threats, physical terrorism, 

and natural disasters that imperil critical infrastructure. The ESCC includes electric company 

CEOs and trade association leaders representing all segments of the industry. Their counterparts 

include senior Administration officials from the White House, relevant Cabinet agencies, federal 

3 
106 


law enforcement, and national security organizations. The ESCC is where these senior leaders 

from industry and government come together to set strategy and priorities on the security, 

resiliency, and responsiveness of the industry and, by extension, the nation. 

I am pleased to address the Subcommittee today to share what steps the electric power industry is 

taking to make energy infrastructure stronger, smarter, and more resilient to continue delivering 

the safe, affordable, secure and rei iable power that Americans count on. 

The electric sector races constantly evolving threats to the energy grid. The industry's risk 

mitigation strategy emphasizes a "defense-in-depth" approach that focuses on preparation, 

prevention, response, and recovery, with an emphasis on isolation ot: and enhanced protections 

for critical assets. While this hearing is focused on storm response and recovery, it is important 

to note that our companies do not build the energy grid or our security responses to meet only 

one type of threat. Whether manmade or natural, malicious or unintentional, relating to cyber or 

physical security, or a combination of threats, we must prepare and plan for them all. 

This hearing comes in response to a series of devastating events. In August, Hurricane Harvey's 

high winds, torrential rains, and storm surge caused significant damage and catastrophic flooding 

in parts of Texas and Louisiana. Days later, Hurricane Irma devastated parts of the Caribbean, 

including the U.S. Virgin Islands and portions of Puerto Rico, and brought unprecedented 

damage to the southeastern United States. Every county in Florida was impacted by the storm, as 

well as parts of Alabama, Georgia, North Carolina, and South Carolina. 

4 
107 


following Irma, Hurricane Maria developed in the Atlantic Ocean as one of the strongest 

hurricanes on record. After impacting the U.S. Virgin Islands, Maria passed directly over Puerto 

Rico, knocking out power to the entire commonwealth. The work to restore power in Puerto Rico 

and in the Virgin Islands continues. Most tragically, each of these events resulted in the loss of 

life. 

Weather is an unavoidable part of our business. In the aftermath of events, the industry works to 

identify gaps, compile lessons learned, and disseminate best practices. We have learned from 

these storms and from previous storms. As an industry, we strive to be better today than we were 

yesterday, and better tomorrow than we arc today. Since Superstorm Sandy five years ago, the 

electric power industry has combined efforts across all segments of the industry and worked with 

government partners to streamline restoration efforts and to improve preparation for and 

response to major events that cause significant outages. The benefits of this coordination were 

visible over the past several months, as the industry and federal government worked to prepare 

for and respond to the hurricanes. 

There is an understandable urge to compare storms, but the reality is that each storm is different. 

One common thread, however, is the need for a resilient infrastructure and a plan for response 

and recovery. Electric companies across the sector are making investments to harden the energy 

grid. As an industry, we plan and regularly exercise for a variety of emergency situations, 

including natural disasters that could impact our ability to provide electricity. In two weeks, 

thousands of participants from industry and government will participate in a biennial industrywide grid security and incident response exercise known as GridEx; this iteration is GridEx IV. 

5 
108 


As with the previous exercises, it will result in a report that identifies gaps and recommendations 

for industry and government. It will be another tool to strengthen our coordination and 

preparation. 

Indeed, each storm is different. However, each of the recent storms is instructive to the benefits 

of investments in resiliency, the need to prepare, and the awesome nature of our industry's 

ability to respond to emergencies. 

Harvey 

Harvey, a Category 4 hurricane, was the first major hurricane to make landfall in the United 

States since Hurricane Wilma in 2005. The storm brought historic flooding to southeastern 

Texas, including nearly 52 inches of rain in some locations and strong winds in places not 

impacted by flooding. The daily peak outages during Harvey were around 350,000 customers. 

However, an estimated 1.4 million restorations occurred throughout Texas and Louisiana, due to 

flooding and the slow-moving nature of the storm that required multiple repairs. More than 

10,000 electric power industry workers from at least 21 states mobilized to restore power to 

customers impacted by Harvey. 

Irma 

Irma, a Category 4 hurricane when it made landfall in Florida, was the most intense storm to hit 

the United States since Hurricane Katrina. More than 7.8 million customers were impacted in 

Florida, Georgia, Alabama, South Carolina, and North Carolina at the peak on September II, 

2017. More than 60,000 workers were involved in the restoration, coming from more than 250 

6 
109 


electric companies across the United States and Canada. This was one of the largest power 

restoration efforts in U.S. history. That effort resulted in 95 percent of customers being restored 

within one week. The speed of the recovery was noted by the U.S. Energy Information 

Administration: 

"About 15% of customers were without power at noon on September 10, and power 

outages peaked at 3:00p.m. on September 11, affecting 64% of customers. In contrast, 

Hurricane Wilma moved quickly across the southern part of the state, knocking out 

power to 36% of customers in Florida. Although the percentage of Florida customers 

without power during Irma was significantly higher than during Wilma, the rate of 

electric service restoration has been more rapid. Five days after Irma's landfall, the share 

of customers without power had fallen from a peak of 64% down to 18% (a recovery rate 

of about 9% of customers per day). Power outages during Wilma declined from 36% of 

customers to 16% by the fifth day after landfall (an average recovery rate of about 4% of 

customers per day) .... Since 2005, Florida Power & Light and other utilities in the state 

have made significant investments to improve their hurricane preparedness. These 

utilities have upgraded electric infrastructure, including replacing wooden utility poles 

with concrete poles. Utilities have also deployed smart grid technologies, which provide 

more timely and more accurate information about outages and can help utilities better 

target restoration efforts." 1 

1 https:iiwww.eia.govitodayinenergyidetail.php?id=32992 

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Maria 

Maria was the second Category 5 storm of the 2017 season and caused widespread destruction to 

all infrastructure on Puerto Rico and the U.S. Virgin Islands, including the energy grid. Power 

restoration has been, and will continue to be, a challenging and complicated effort. The entire 

electric power industry continues to closely coordinate with its federal government partners to 

support these efforts. Unlike Hurricanes Harvey and Irma, mutual assistance has yet to be 

triggered in response to Maria. Mainland electric companies are ready to support the restoration 

and rebuild of Puerto Rico's infrastructure and provide any expertise, resources, crews, or 

materials needed to turn the lights on for our fellow Americans. 

Nate 

Nate made landfall on October 7 in southeast Louisiana and Mississippi as a Category I 

hurricane with winds of 85 mph. I mention Nate because it was notable for not causing 

widespread outages. Some may think that the region "dodged a bullet" because of the relatively 

minimal damage and impacts, with about 100,000 customers losing service during the storm. 

However, the quick response and recovery are in fact evidence that investments in resilient 

infrastructure and preparation pay off. 

Prepare, Respond, Recover- The Role of the ESCC 

Hurricanes like Harvey, Irma, Maria, and Nate draw attention to the critical importance of 

cooperation and coordination among electric companies, the government, and other key 

infrastructure industries to ensure fast, efficient recovery for customers. 

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Following Superstorm Sandy in 2012, the industry and government worked together to 

streamline restoration efforts and to improve how the sector prepares and responds to major 

events that cause significant outages. In October 20 l 0, the National Infrastructure Advisory 

Council (NIAC) issued a report, "A Framework for Establishing Critical Infrastructure 

Resilience Goals," that included nine recommendations. The first recommendation was for the 

White House to "initiate an executive-level dialogue with electric and nuclear sector CEOs on 

the respective roles and responsibilities of the private sector in addressing high-impact 

infrastructure risks and potential threats ... " That recommendation eventually led to the creation 

of the ESCC. 

The ESCC is comprised of the CEOs of 21 electric companies and nine major industry trade 

associations. It includes all segments of the electric power industry, representing the full scope of 

electricity generation, transmission, and distribution in the United States and Canada. Each year, 

the ESCC convenes three coordination meetings with senior government officials to identify 

emerging security issues and to develop approaches to mitigate risk, including cyber and 

physical security. However, the ESCC is much more engaged than three formal meetings a year 

with the government. Those "blue sky" meetings help prepare the industry and government for 

response efforts. In between, there's constant work together leveraging industry and government 

executives and subject matter experts to develop numerous initiatives with the goal of improving 

the industry's preparedness and resilience. During incidents, the ESCC helps to coordinate 

efforts across industry and government in response to all hazards. 

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Over the past several years, this partnership has resulted in a number of important changes in 

how both government and industry work together to protect critical infrastructure. One 

outgrowth from the creation of this group is the ESCC Playbook- a framework for senior 

industry and government executives to coordinate response and recovery efforts and 

communications to the American public. The playbook has been tested in a series of exercises 

and informs our response and recovery efforts today. 

Exercising the playbook means that the industry and our government partners can fix problems 

in real time during disasters. During the most recent storms, the ESCC held daily coordination 

calls among impacted companies and government officials to address critical operational issues 

such as identifying specialized equipment needs; removing temporary flight restrictions for both 

manned and unmanned aircraft to assist with aerial damage assessments; coordinating how 

industry could re-enter and access disaster areas; and coordinating response efforts with the oil 

and natural gas, telecommunications, transportation, and water and wastewater sectors. 

Department of Energy Secretary Rick Perry was on every call and was joined frequently by other 

officials such as Department of Homeland Security Acting Secretary Elaine Duke. These calls 

were essential to identifying and addressing critical issues in the response and recovery efforts. 

Conclusions 

The reliability and resiliency of the grid are of paramount importance. Our customers expect the 

lights to go on when they tlip a switch. When power goes out, our customers expect that it will 

be on soon. The electric power sector will continue to strive to meet those expectations through a 

multi-layered strategy to invest in smarter energy infrastructure, continuous enhancement of our 

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industry-government partnership, and the grit of the amazing men and women who make the 

energy grid work day in and out. 

The Subcommittee is showing great leadership with its focus on preparedness, and we look 

forward to working with you on this critical topic. Thank you again for the opportunity to testify 

on behalf of the ESCC, and I look forward to your questions. 

II 
114 

Mr. OLSON. Thank you, Mr. Fanning. 

And now, the Chair is glad to call upon Mr. Julio Rhymer, the 

Executive Director of the Virgin Islands Water & Power Authority, 

that suffered devastation from two hurricanes, Irma and Maria. A 

5-minute opening statement, Mr. Rhymer. Thank you. 

STATEMENT OF JULIO A. RHYMER, SR. 

Mr. RHYMER. Good evening, Mr. Chair, other honorable members 

of the Subcommittee on Energy. 

My name is Julio A. Rhymer, Sr. I am an Executive Director and 

Chief Executive Officer of the Virgin Islands Water & Power Authority. 

On behalf of the Governor of the Virgin Islands, the honorable 

Kenneth E. Mapp; the Virgin Island Delegate to Congress, Honorable Stacy Plaskett; the members of the 32nd Legislature of the 

Virgin Islands, and the Governing Board of WAPA, I thank you for 

the invitation to provide testimony on the energy challenges facing 

the U.S. Virgin Islands as a result of the passage of Hurricanes 

Irma and Maria. 

As you all are aware, in September of 2017, the Virgin Islands 

faced the phenomenon of two back-to-back Category 5 hurricanes 

within two weeks. According to the Saffir-Simpson Wind Scale, a 

Category 5 hurricane has sustained winds of greater than 157 

miles per hour. There were cases in Hurricane Irma that winds 

were sustained at above 190 miles an hour. 

WAPA’s transmission and distribution facilities were, plain and 

simple, destroyed by the catastrophic winds of two hurricanes. Due 

to Hurricane Irma’s impact on September 6th, 2017, the St. Thomas, St. John, Water Island, and Hassel Island electrical transmission distribution system suffered significant damage. The St. 

Thomas system sustained damages of approximately 80 percent; St. 

John, approximately 90 percent; Water Island, 90 percent, and 

Hassel Island, 90 percent. 

Approximately two weeks later, on Tuesday, September 19th, 

2017, Hurricane Maria caused damage to almost 60 percent of the 

transmission and distribution system on St. Croix. The islands of 

St. Thomas, St. John, Water Island, and Hassel Island did not receive any significant damage from a result of Hurricane Maria. 

To date, the Authority has approximately 536 linemen and other 

related off-island personnel in the Territory, restoring WAPA’s electrical infrastructure. With the assistance of FEMA, naval vessels 

and cruise ships have been brought in to provide sleeping quarters 

for the off-island crews, since many hotels and guesthouses 

throughout the Territory remain closed after sustaining major 

damages during these two hurricanes. 

By far, the biggest challenge that I would like to focus on today 

is funding the day-to-day operations and hardening of the system 

in the event of future storms. Without question, these hurricanes 

have decimated WAPA’s finances. While we appreciate the assistance that has been, and will be, forthcoming to rebuild the systems 

that were damaged, one of our primary concerns as the Authority 

is the ability to meet prestorm expenses. Prior to hurricanes, the 

Authority’s revenues were approximately $25.6 million per month. 

Since the hurricanes events, and since we are unable to provide 

115 

electrical service and bill customers, revenues have dropped below 

$2 million per month. 

WAPA has reoccurring expenses such as payroll, insurance, plant 

operation and maintenance, debt service, and previously-executed 

contracts, and financing agreements it must pay. To address this 

dramatic shortfall, the Authority has sought, through the government of the Virgin Islands, a community disaster loan. Any support 

or assistance that you can offer in this regard is appreciated. 

One of the evident takeaways from the two Category 5 hurricanes, and significant damages to this regional system 

Territorywide, is that there is an urgent need for WAPA to rebuild 

its transmission and distribution systems, but to harden it to a 

point where it is resilient to wind storms. WAPA believes it would 

significantly reduce its post-storm hurricane period by undergoing 

more of its critical infrastructure and by moving away from wooden 

poles and introducing composite poles on the major distribution circuits. 

WAPA must also address its grid, since it is too susceptible to 

damage from wind storms. WAPA had a proposed plan to construct 

a series of microgrids on each island. Each microgrid would be a 

localized group of electrical facilities that would either work in tandem with the generating facilities or an option for disconnection 

where they can stand alone. In the event the power and the main 

grid is interrupted for any reason, the microgrid would function as 

a small facility generating its own power at this point. 

Currently, you have in the works a microgrid on the island of St. 

Croix that is actually going to go out for bid, and that will provide, 

basically, power through solar and battery storage to our airport facilities, a waste treatment facility, a correctional facility, and, basically, a police station at this point. What we are actually attempting to do here, as a utility moving forward, is to harden our system, No. 1, and, basically, make it more resilient by having 

microgrids. 

I would like to thank you for the opportunity to appear before 

the Subcommittee on Energy. I am available to answer any question that you may have on this matter. 

[The prepared statement of Mr. Rhymer follows:] 

116 


JULIO A. RHYMER, SR. 

EXECUTIVE DIRECTORJCEO 

VIRGIN ISLANDS WATER and POWER AUTHORITY 

STATEMENT BEFORE THE 

COMMITTEE ON ENERGY AND COMMERCE 

SUBCOMMITEE ON ENERGY 

UNITED STATES CONGRESS 

HEARING ON 

The 2017 Hurricane Season: A Review of Emergency Response & Energy 

Infrastructure Recovery Efforts 

As a result of the Recent Hurricanes 

NOVEMBER 2, 2017 

Good day Chairman Upton, Ranking Member Rush, and other Honorable members of the 

Subcommittee on Energy. My name is Julio A. Rhymer, Sr. lam the Executive Director/Chief 

Executive Officer of the Virgin Islands Water and Power Authority ("V.I. WAPA," "WAPA," or 

the "Authority"). On behalf of the Governor of the Virgin Islands, the Honorable Kenneth E. 

Mapp, the Virgin Islands Delegate to Congress, the Honorable Stacey Plaskett, the members of 

the 32"d Legislature of the Virgin Islands, and the Governing Board of the W Al'A, I thank you 

for the invitation to provide testimony on the energy challenges facing the Virgin Islands as a 

result of the passage of Hurricanes lnna and Maria on September 6, 20 i 7 and September 19, 

2017, respectively. 

SECTION l. INTRODUCTION 

Hurricanes are not an unusual occurrence in the Caribbean where the Atlantic Hurricane 

Season nms from June I st to November 30111, with the peak period from early August through the 
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end of October. Based on historical weather records dating back to the 1950s, the Atlantic 

region typically experiences 12 tropical storms with sustained winds of 39 mph, of which six 

turn into hurricanes, with winds reaching 74 mph or greater, and three develop into major 

hurricanes, Category 3 or higher, with sustained winds of at least Ill mph. It is important to 

note that most of these hurricanes do not make landfall in the U.S. Virgin Islands, and that a 

hurricane passes near the U.S. Virgin Islands, on average, every three years, and makes a direct 

hit on the islands, on average, every eight years. 

As all of you are aware, in September of 2017, the Virgin Islands faced the phenomenon 

of two back to back category five hurricanes. According to the Saffir-Simpson Wind Scale that 

is used by the National Hurricane Center to classify hurricanes based on wind speed, a Category 

Five hurricane has sustained winds greater than 156 mph. 

SECTION 2- OVERVIEW OF THE HOW THE AUTHORITY OPERATES 

Before I tell you about the devastating impact the hurricanes have had on the utility, 

allow me to provide you a brief overview of how electrical service is provided to the businesses 

and resident of our community. Like most other Caribbean islands, the USVI has no 

conventional energy resources to meet its power needs. While U.S. mainland utilities can 

connect to grids to purchase power from other utilities in the continental United States, island 

utilities such as V.I. W APA are small, isolated and do not benefit from being interconnected to a 

grid comprised of other utilities. The separation of the islands by water, coupled by the depth of 

the ocean floor also makes interconnection via submarine cables both technically and financially 

prohibitive. To maximize the benefit of market conditions, island utilities have historically 

purchased small simple-cycle, oil-fueled, generating units. From the 1980s to approximately 

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September of 2003, the inflation-adjusted price of a barrel of crude oil on the NYMEX was 

generally under $25/barrel. The attraction of such low-cost fuel, combined with the economies 

of scale, provided the framework for island utilities, like WAPA, to purchase these oil powered 

units. 

As a result of the Virgin Islands being comprised of several small islands separated by 

water, duplicate generation systems and increased reserves are required to meet the demand for 

electrical services. V.I. WAPA, for example, has two independent generation systems. One 

system, located on St. Thomas, serves the islands of St. Thomas, St. John, Water Island, and 

Hassel Island, and the other is located on St. Croix. Our two power plants sit more than 40 miles 

apart and are not interconnected due to the depth of the ocean floor. 

In recent years, W AP A has met some success in the diversification of 100% reliance on 

fossil fuel. We have implemented up I 5 MW of Net Metering, and through public/private 

partnerships we have added approximately 8.2 MW of solar power to our electric grid. Through 

these initiatives, W APA now has the capability to derive up to 20% of its generation capacity 

from renewables. 

In yet another effort to reduce our reliance on fuel oil, W APA partnered with VITOL 

Group, a multi-national energy and commodity trading company, to construct and operate 

Liquefied Petroleum Gas (LPG) terminals, supply LPG and manage the conversion ofWAPA's 

gas units. Several of WAPA's generators are now tri-fuel capable, and can be fueled by oil, 

LPG, or natural gas. 

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In March of this year, WAPA contracted with Wartsiia North America, to provide the 

first new generation for the Authority's operation in over a decade. The three new generators, at 

7 MW each, will burn LPG to produce electrical power. The units were expected on island by 

the end of this year, with completion in the first quarter of 20 18; however, due to the hurricanes, 

there will be a slight delay. The move to smaller units emerged from an Integrated Resource 

Plan developed for W APA to provide a roadmap for future generation needs. The grant, for 

$500,000, was funded by the Department of Interior. 

Utilizing FEMA hazard litigation grants, limited portions of the utility's electric power 

transmission and distribution ("T&D") systems have been placed underground. Critical 

infrastructure such as the territory's hospitals, airports, and approximately 75% of the main 

business districts are underground. After Hurricanes Irma and Maria, those facilities were 

among the first to be restored. The remainder of the T &D system is comprised largely of aerial 

circuits suspended by wooden poles. While this has been the lowest cost method of developing a 

T&D system, it is also the most vulnerable in windstorms. 

SECTION 3: IMPACT OF THE STORMS 

While our power generating plants in Estate Richmond on St. Croix and Krum Bay on St. 

Thomas suffered minimal impact from the hurricanes, the transmission and distribution systems 

did not fare as well. Damage to the systems was estimated at 80% on St. Thomas and more than 

90% on St. Join, with Water Island and Hassel Island each suffering approximately 90% 

destruction. Following the passage of Hurricane Irma on September 6, WAPA, utilizing its own 

line department personnel along with on-island contractors, engaged a Territory-wide 

reconstruction and restoration effort. Two weeks later, on September 19, Hurricane Maria left 

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about 60'Yo damage to St. Croix's T&D system, while the remainder of the Virgin Islands did not 

receive any further damage. 

In our ongoing recovery efforts following the hurricanes, W APA continues to address the 

five (5) critical areas necessary to rebuild our electrical system. These are: equipment, materials 

and supplies, funding for operations, emergency restoration crews and housing for crews. There 

are presently in excess of 520 oft~ island linemen in the Virgin Islands restoring our T &D 

systems, beginning with the primary circuits. Their work will end when every residential area of 

our territory has been energized. These crews, which typically consist of six individuals, are 

being provided primarily by Haugland Energy Group, LLC, BBC Electrical Services, and 

utilities from the North East Public Power Association. With the assistance of FEMA, a 

contracted cruise ship have been brought into the territory to provide sleeping quarters for offisland personnel, since many hotels and guest houses throughout the territory closed after 

sustaining major damages to their infrastructure during the two hurricanes. 

Bringing vehicles, materials, and equipment has also been a challenge. Because of our 

unique geographical location, surrounded by water, V.I. WAPA cannot truck materials and 

supplies to the islands, and air travel cannot readily supply the large quantities of these items 

needed. Almost all needed vehicles, equipment, and supplies that cannot be sourced on-island 

are shipped in via cargo shipping, which, as you can imagine, competes for space with all other 

government agencies, businesses, and individuals that are shipping cargo with relief materials to 

the Virgin Islands. In terms of materials, large quantities of poles, conductors, insulators, singlephase and three-phase transformers are being ordered to build and repair overhead subtransmission (35 kV) circuits, build and repair three-phase main distribution feeder lines (15kV 

5 
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and 25kV) along the Authority's feeder routes, build and repair three-phase and single-phase 

laterals along existing distribution routes, install and replace pole-mounted distribution 

transformers up to 75 kVA on 15kV and 25 kV distribution systems, and install and repair 

secondary conductors to customer service drop locations. The current focus is on restoring 

overhead transmission feeders and main distribution feeder trunks. 

To restore the transmission and distribution system, the Authority will require additional 

equipment, including pole trucks, bucket trucks, and digger derricks, along with other vehicles 

such as trucks and sport utility vehicles. The purpose of the pole trucks in the current restoration 

is to transport poles to the specific sites for replacement. Pole trucks will be deployed with each 

crew in order to assist with the restoration process. Bucket trucks will be used to string lines, 

dress poles, and service lines to customer locations. These are essential pieces of equipment for 

the entire restoration. Digger derricks will be used to dig holes for the new poles to be planted. 

The additional vehicles such as pick-up trucks and sport utility vehicles will be used to transport 

crews, support personnel, and additional supplies not housed on the other pieces of equipment. 

These vehicles will also be used to survey and assess damages for all sectors of the transmission 

and distribution system. 

By far, the biggest challenges, and the ones I would like to focus on today, are the 

funding for day-to-day operations, as well as hardening of the system in the event of future 

storms. The hurricanes, it goes without saying, have decimated the finances of W APA. It is a 

significant hardship for the utility to operate and pay for day to day expenses, much less these 

extraordinary expenses that accompanies the restoration efforts. We wish to thank the Congress 

the Senate and the llonorable President Donald L. Trump for passing speedy relief in the form of 

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a $36.5 billion aid measure that would help the Virgin Islands and Puerto Rico restore our 

infrastructure. 

While we appreciate the assistance that has and will be forthcoming to rebuild the 

systems that were damaged, our primary concerns with the Authority's operation is our ability to 

meet our pre- existing expenses. Prior to the hurricanes, the Authority's revenues were, on 

average, $26.5 million per month. After the hurricanes and the destruction of the T&D systems, 

and since we cannot bill customers, our revenues have dipped to below $2 million per month. 

The V.I. Water and Power Authority has recurring expenses such as payroll, insurance, operation 

and maintenance of the plants, debt service, previously executed contracts, as well as financing 

agreements we must pay. To address these expenses, the Authority through the Government of 

the U.S. Virgin Islands, has sought a Community Disaster Loan. Any support or assistance that 

you can offer in this regard is appreciated. 

One of the evident takeaways from having to rebuild the T &D systems four times within 

the last three decades is an urgent need for WAPA to not just rebuild our transmission and 

distribution system to what it was before the storm, but to harden or otherwise make it 

impervious to windstorms. One step in such direction would be achieved through the use of 

composite poles. Research has indicated that composite poles, even with wind-loading 

attachments, have better withstood the devastating winds of major hurricanes, when compared to 

the wooden poles now in use by WAPA. A second step toward building a more resilient system 

would be the relocation of overhead facilities to underground. The total number of composite 

poles that would be needed to replace wood poles on the main distribution feeders in the St. 

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Thomas-St. John district is 4,290, and 5,854 for the St. Croix District. The approximate cost of 

materials and supplies to complete restoration is $30,000,000. 

In addition to hardening our distribution system, WAPA must also address the electric 

grid which is also susceptible to damage from windstorms. WAPA's proposed plan is to 

construct a series of micro grids on each island. 

Each microgrid would be a localized grouping of electricity sources that would operate in 

tandem with WAPA's generating facilities. Each could be disconnected and function 

autonomously as physical and/or economic conditions dictates. For example, In the event of an 

electrical service interruption, the microgrid would function as a small facility generating on its 

own power. Currently, W APA is planning to develop the first ever micro grid facility in the 

Virgin Islands, in conjunction with the Virgin Islands Port Authority at the St. Croix Henry R. 

Rohlsen Airport. This microgrid would be energized with 4 MW of solar power and 2 MW 

battery storage. As funding permits, additional microgrids will be developed at other locations 

within and around the Territory. Plans for the Authority's grid, as well as efforts for a more 

robust T &D system arc all contingent on acquiring the necessary funding for these projects. The 

Authority has already approached the USDA's Rural Utility Service in regards to funding these 

projects, as well as our future needs. I would like to thank you for the opportunity to appear 

before the Subcommittee on Energy today. I am available to answer any questions that you may 

have. 

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124 


JULIO A. RHYMER, SR. 

EXECUTIVE DIRECTOR/CEO 

VIRGIN ISLANDS WATER and POWER A UTHOR!TY 

STATE:MENT BEFORE THK 

COMMITTEE ON EN1<3RGY AND COMMERCE 

SUBCOMMITEE ON ENERGY 

UNITED STATES CONGRESS 

HEARING ON 

The 2017 Hurricane Season: A Review of Emergency Response & Energy 

b!frastructure Recovery Efforts 

November 2, 2017 

SUMMARY: 

• On September 6'11 and 19'h, 2017 two back to back category tive hurricanes hit the 

Virgin Islands destroying transmission and distribution facilities on both islands. 

• There are five (5) critical areas that must be addressed in order for the electrical 

system to be restored: equipment, materials and supplies, funding tor operations, 

emergency restoration crews and housing for restoration crews. 

The current major challenges are the funding for day to day operations and 

hardening of the system for fi.tture hurricane events. 
125 

Mr. OLSON. Thank you, Mr. Rhymer. And I heard what Irma 

didn’t destroy, Maria drowned. 

Mr. RHYMER. Yes, it did. 

Mr. OLSON. The Chair now calls upon Mr. Chet Thompson. Chet 

is the President and CEO of the American Fuels & Petrochemical 

Manufacturers. 

Mr. Thompson, you have 5 minutes for an opening statement. 

STATEMENT OF CHET THOMPSON 

Mr. THOMPSON. Thank you, Mr. Vice Chairman, Ranking Member Rush, and members of the subcommittee. Thank you for having 

me here today. 

My name is Chet Thompson. I am the President and CEO of the 

American Fuel & Petrochemical Manufacturers. AFPM represents 

the refining and petrochemical industries. Our members represent 

120 refineries, 140 petrochemical facilities. That represents 98 percent of U.S. production capacity. More than half of that capacity is 

located along the Gulf Coast. 

Hurricane Harvey impacted our facilities in the fuel supply chain 

very hard. Hurricane Irma impacted the fuel supply chain, but 

largely in Florida, while Nate’s impact on our assets was rather 

minimal. 

But, more importantly, the combination of Hurricanes Harvey, 

Irma, and Maria were devastating to the people of the Gulf Coast, 

particularly those in Houston and the Beaumont area, Florida, and 

Puerto Rico. Many of those impacted are part of our extended oil 

and gas family. Our hearts and prayers continue to go out to those 

still struggling to recovery, and we stand by them and will help 

them any way we can. 

As a result of this personal impact on us, the subject of today’s 

hearing is particularly important to our industry. So, I would like 

to limit my time this afternoon only to three key points of my written testimony. 

First, by and large, the U.S. refining and petrochemical industries weathered the storm fairly well and proved to be very resilient. This did not happen by accident. Rather, it was the result of 

lots of hard work and preparation, and with the help of an incredibly dedicated workforce and Federal, State, and local first responders. They are the true heroes coming out of these events. 

If you wanted to draw the storm up that could wreak the most 

havoc on our industry, Harvey was it. Harvey hit Corpus Christi 

as a Category 4 storm, moved right up the east coast, stalled largely over Houston, which is the epicenter of the refining and petrochemical industries. It dumped over 60 inches of rain in some locations and more than a trillion gallons of water across Texas and 

Louisiana. 

At its peak, Harvey knocked 24 of our refineries offline. That 

represents 25 percent of all U.S. refining capacity. It had a similar 

impact on our petrochemical members. It knocked 60 percent of 

U.S. petrochemical capacity down. That is 80 percent of the capacity found in the Gulf Region. 

Harvey also had a significant impact on the entire fuel supply 

chain. It shut down ports, pipelines, terminals, rail, and certainly 

126 

gasoline stations. Our facilities couldn’t get feed into their plants, 

and we certainly couldn’t get products out. 

This had the potential to be catastrophic for the fuels and petrochemical supply chains, but in the end it wasn’t. Just two weeks 

after Harvey made landfall, 20 of the 24 facilities that went down 

had restarted. And the petrochemical facilities made substantial 

progress during this period as well. 

Again, this was not by accident. Facilities were prepared for the 

storms. They had applied many of the lessons learned in the 

aftermaths of previous storms like Katrina and Rita. For example, 

our facilities developed more sophisticated preparedness plans, improved storm monitoring, hardened critical infrastructure, elevated 

pumps and generators, procured spare parts so we could be ready 

to move with recovery efforts after the storm. We upgraded our IT 

systems to help us locate employees and ensure that they had the 

assistance they needed. All of this made a difference. We came 

back online much faster than we did after prior storms. 

The second point I would like to make, the Federal and State response was significantly improved compared to previous storms. 

One of the lessons we have learned is that we have to better coordinate Federal, State, and local governments. So, over the last few 

years, we have been working hard in that regard, working closely 

with DOE and DHS to improve our relationships. 

The results during Harvey, in particular, were excellent. We 

were in constant contact before, during, and after the storms. The 

improved coordination was most evident in the quick review and 

approval of fuel waivers, unlike in prior storms, helping us get fuel 

to where it was needed quickly and efficiently. Our Federal and 

State partners, particularly Secretary Perry, Administrator Pruitt, 

Governors Abbott and Scott, deserve kudos for these improvements. 

If I had to identify the one area that could be improved, it would 

be better communication by our Government to consumers about 

the fuel supply chain and the challenges that often accompany 

events like hurricanes. For example, the Government could help us 

explain the timelines for bringing facilities back online and getting 

products back to the distributors and the marketers. And it could 

also help us discourage panic buying that always seems to accompany these types of events. 

Third and finally, as always, our companies will work with Federal and State authorities to identify and apply lessons learned. Although we did fare fairly well, no doubt there are going to be 

things we can learn and improve upon to make future responses 

even better. We would caution anyone to resort to any knee-jerk reactions or conclusions, particularly those based on a few isolated 

events, before full assessments are in. 

So, I know I am running out of time. I thank everyone for my 

time and the opportunity to speak today. 

And again, I would like to express our thanks and appreciation 

for our incredible workforce and our first responders. They certainly deserve our appreciation. 

So, thank you, and I am happy to answer any questions. 

[The prepared statement of Mr. Thompson follows:] 

127 


House Committee on Energy and Commerce, Subcommittee on Energy 

Hearing entitled '7he 2017 Hurricane Season: A Review of Emergency Response and Energy 

Infrastructure Recovery Efforts" 

Testimony of Chet Thompson, President and CEO, American Fuel & Petrochemical Manufacturers 

November 2, 2017 

The American Fuel & Petrochemical Manufacturers ("AFPM") appreciates the opportunity to provide 

testimony on the effectiveness of public and private sector response efforts to Hurricanes Harvey and 

Irma. AFPM is proud to represent more than 95 percent of the nation's refining and petrochemical 

manufacturing capacity. Our members make the gasoline, diesel, jet fuel, and petrochemicals that make 

modern life possible. Hurricanes Harvey and Irma demonstrated not only the resiliency of our nation's 

energy sector, but also the dedication of the nation's first responders and the incredible people that 

work in the refining and petrochemical industries. 

The U.S. Gulf Coast, and Houston in particular, is the heartbeat of the global energy and petrochemical 

sectors. Texas Is home to 30 refineries with more than 5.4 million barrels per day ("bpd"} of refining 

capacity. Louisiana is home to another 19 refineries and 3.3 million bpd of capacity. Combined, these 

two states are home to more than half of U.S. refining capacity. There are 30 olefins (ethylene and 

propylene} production complexes in the U.S.; 19 are in Texas and eight are in Louisiana. Texas alone has 

the capacity to produce roughly 125 million pounds per day of ethylene, which is viewed as a leading 

indicator of growth in the manufacturing sector. Altogether, the refining and petrochemical industries 

contribute $229 billion to the economies of Texas and Louisiana and support nearly one million jobs. 

Our employees not only worked around the clock to prepare for and respond to one of the largest 

hurricanes in U.S. history, but did so while dealing with displaced family and friends, not to mention the 

personal loss of homes, cars, clothing, and everything else we take for granted. 

AFPM is proud to report that our industries were well prepared and weathered Hurricane Harvey fairly 

well. 

Hurricane Harvey forced 24 refineries representing 25 percent of U.S, refining capacity to shut down or 

run at reduced rates. But just two weeks later, refiners were almost fully operational and those still 

down or in the process of restarting were working to resume operations as quickly and safely as 

possible. 

Safety is the core tenet of the fuel and petrochemical industries. Actions taken for hurricanes like Harvey 

and !rma are in the interest of safety- protecting employees1 communities and the environment. The 

industries' swift and effective response is indicative of a workforce that prides itself on continuously 

improving upon its safety record1 implementing best practices, investing in training and preparedness/ 

and using the best-available technology to safeguard its people. The industries are confident these 

precautions helped mitigate damage and improve safety around these storms. 

It took a team to mitigate Harvey's impact. The industries did not do this alone- we got tremendous 

help from our dedicated workforce, first responders and federal, state, and local authorities. A lesson 
128 


!earned from Hurricanes Katrina and Rita was that these critical partners needed to improve working 

together. The government especially came through for the industries with better, accessible 

information. These partners deserve credit for the improvements since previous incidents. 

Finally, despite the havoc wrought by Harvey on the supply side, the refining industry was prepared for 

Irma. For Harvey, there was a loss of production capabilities. The job was to keep and restore 

production as much1 and as quickly as possible, There are no refineries in florida, so Jrma was more 

about a disruption in distribution and delivery of fuels. The refining industry's job was to get fuel to the 

people who needed it. To do this, the industry put as much product as it could into the market in 

advance of Irma and staged products on both coasts to get fuel to Floridians as soon as it was safe and 

infrastructure allowed. Our industries and our people have been resilient in the face of extraordinary 

circumstances. 

Impact of Hurricanes Harvey and Irma on Transportation Fuel Supply and Distribution 

Nothing is more important to AFPM's members than the safety of their employees, communities, and 

first responders. As a result, refineries will reduce or shut down operations if companies do not believe 

running can be done safely. Hurricane Harvey alone dumped 60 inches of rain and more than a trillion 

gallons of water across the U.S. Gulf Coast. The magnitude of the storm resulted in the closure or 

slowdown of an unprecedented 24 refineries along the U.S. Gulf Coast from Corpus Christi, Texas, to 

Lakes Charles, Louisiana (see Appendix A for a full list of impacted refineries). This affected 50 percent 

of the refining capacity in the region and 25 percent of total U.S. refining capacity. For context, 

Hurricanes Katrina and Rita resulted in the shutdown or reduced output of 20 percent of U.S. refining 

capacity in 2005. The impact on the U.S. petrochemical industry was even more pronounced-at its 

height the hurricane impacted nearly 60 percent of U.S. upstream chemical manufacturing capacity. 

Petrochemicals like ethylene, propylene, and xylene form the foundation for many of the chemicals and 

plastics found in everything from food packaging to medical equipment and mobile devices. These 

supply chains were disrupted lor many weeks following the storm. 

Despite the temporary disruption in the refining sector, the market was well-supplied. In fact, heading 

into Hurricane Harvey, U.S. inventories of gasoline (230 million gallons) were well above the five-year 

historical average. As supplies were disrupted, the East Coast drew down this inventory. East Coast total 

gasoline inventories in the week ending September 1, 2017, fell by 2.2 million barrels, or 3.5 percent, 

compared with the previous week. Almost all of this drawdown occurred in the Lower Atlantic region, 

which stretches from Virginia to Florida. This weekly drop in inventories was smaller than the drop that 

occurred following a previous outage of the Colonial Pipeline in September 2016, when Lower Atlantic 

gasoline inventories fell by nearly six million barrels. 

The global fuel supply chain is extraordinarily complex. At the most basic level, it starts with upstream 

oil exploration and production, both on-shore and off-shore. Crude oil is gathered and shipped via 

pipeline, rail, and maritime to U.S. refineries for processing into gasoline, diesel, jet fuel, heating oll, and 

many other products. Refined products are moved through the bulk transfer system to terminals, 

where they are blended with biofuel, moved onto trucks, and delivered to retail. Disruption along any 

portion of this supply chain can have ripple effects up and down the supply chain system. This can be as 

simple as retail stations losing power and the ability to pump fuel out of the underground storage tanks. 

It may include flooded roads that prevent the "last-mile" delivery of fuel to stations. It may be lack of 

access to pipeline, terminals, or any other major asset in the bulk transfer system. 
129 


To better illustrate the complexity of these fuel movement, we have included maps published by the 

U.S. Energy Information Administration I"EIA") in Appendix B that illustrate the flow of crude oil and 

petroleum products throughout the U.S. The primary challenge in recovery was overcoming the 

logistical barriers in getting product to consumers, as virtually every aspect of the bulk distribution 

system pipelines, ports, and terminals- was also impacted, creating ripple effects along the full supply 

chain. 

Many crude oil and petroleum product pipelines were affected by Harvey. The most significant outage 

was the Colonial Pipeline, which connects to 29 refineries and 267 distribution terminals and carries up 

to 2.5 million barrels per day of gasoline, diesel, and jet fuel from Houston through the Southeast U.S., 

and as far north as New York Harbor. Likewise, pipeline outages within Texas disrupted product flows to 

parts of the state, including Dallas. As a result, trucks typically used for the "last mile" of the supply 

chain were resourced as far away as Kansas City to pick up fuel, a 1,500-mile roundtrip. Despite the 

market being well-supplied, consumers engaged in panic-buying. In fact, demand in parts ofTexas 

doubled over a short period of time, putting a strain on available supplies. In Florida, demand increased 

five-fold as millions of people evacuated in front of Hurricane Irma. The panic increased demand 

complicated relief efforts and contributed to supply issues in some areas. 

The U.S. Gulf Coast is home to a dozen ports in three sectors (Corpus Christi, Houston and Galveston, 

and Port Arthur and Lake Charles). These ports are heavily trafficked with ships delivering crude oil to 

U.S. refiners and with product shipments to other parts ofthe U.S. and abroad. Hurricane Harvey 

temporarily closed or severely impacted the operating status of the majority of ports in the Gulf Coast 

region, from Corpus Christi to Lake Charles, and every port in between. Flooding, submerged obstacles, 

currents, security concerns, and other factors complicated efforts to get crude oil to refineries and 

product out of refineries to consumers via marine vessel. According to the American Chemistry Council, 

port closures affected 39 percent of waterborne chemicals trade. 

Crude and refined product storage and distribution terminals are essential links in the petroleum supply 

chain. These facilities ship and receive crude oil and refined products from pipelines, marine vessel, rail 

and truck. As of March 2017, 49 percent of total U.S. working crude oil storage capacity and more than 

40 percent of working storage capacity for both motor gasoline and diesel fuel were located in the Gulf 

Coast region. Many of the crude oil and refined product terminals along the U.S. Gulf Coast in the path 

of Harvey were preemptively shuttered before Hurricane Harvey made landfall, and remained closed 

through landfall, flooding, and cleanup. In addition, Hurricane Harvey drastically disrupted the railroads 

that support these terminals as well as refineries and petrochemical plants in the region. Specifically, 

Union Pacific Corporation and BNSF Railway, the two leading U.S. railroads, and regional railroad Kansas 

City Southern all suspended operations in the area affected by the storm. Rail shipments out of 

Houston were delayed through mid-September, though steadily improving. It wasn't until September 19 

that Union Pacific, for example, was able to announce Gulf Coast operations had been fully restored. 

After conducting inspections and repairs to damaged rail infrastructure, the railroads began limited 

service in the region approximately a week after the storm. It's not possible to determine the precise 

impact of Harvey on rail traffic, but it has been clearly negative, so far. We estimate that the area 

immediately affected by Harvey accounted for approximately 764,700 originated carloads in 2014 (the 

most recent year for which data are available). 
130 


Despite the significant challenges presented by Hurricane Harvey, within 29 days, all but a couple 

facilities were back up and running. This is a testament to the professionalism, preparation, 

determination, and resiliency of the refining and petrochemical industries. Thanks to investments the 

industries have made and a well-coordinated federal, state, and local response, facilities were able to 

recover more quickly than after previous events. However, this process is not without challenges. 

Restarting a refinery requires more than simply flipping a switch-it is a complicated process that can 

take several weeks. The relatively quick resumption in output is significant given that restarting plants is 

much more complicated than flipping on a light switch. Restarts take time. Like shutdowns, restarts 

must be done slowly and deliberately to protect the health and safety of employees, as well as 

communities and environment. 

Restarts after storms include securing safe access to the site, and checking the integrity of equipment, 

storage tanks, process units, and instrumentation. They also include inspecting facilities for any storm 

damage, making any necessary repairs, and verifying that there are sufficient feedstocks, such as oil and 

natural gas, available for processing from ports and pipelines. Inbound supplies must be able to arrive at 

the refinery and outbound products must have a clear route to market, so transportation infrastructure 

ls also examined before opening, 

As soon as all facilities are determined to be safe, crews move to energize electrical systems and 

cautiously ramp up activity in process units to begin turning raw materials into products such as diesel, 

gasoline, and jet fuel. 

When a refinery is restarted, operators proceed slowly and carefully because piping systems may have 

unprocessed hydrocarbons inside of them that are left over from the shutdown. Operators also work to 

identify any anomalies or changes in the system as units are brought back online. Making sure each unit 

is operating normally keeps the overall system safe. 

While Hurricane Harvey primarily impacted the ability for the U.S. to produce fuels, the primary 

challenge with Hurricane Irma was getting fuel to consumers in a safe and timely manner. 

Transportation fuel markets in Florida rely entirely on supply from outside the region, primarily product 

supplied by marine tanker and barge, but also, to a lesser degree, by truck. Marine terminals, which are 

primarily concentrated at deep-water ports along Florida's Gulf of Mexico and Atlantic coastlines, 

receive bulk products on tankers and ocean~going barges from Gulf Coast refining centers and foreign 

supply sources. From the marine terminals, products are further distributed to markets along the 

coastline by intrastate barge and truck movements, and via pipeline to Orlando. Markets in the Florida 

Panhandle are also supplied from distribution terminals in Mobile, Alabama1 as well as terminals in 

Bainbridge, Georgia, that receive fuels from the Colonial Pipeline. These deliveries into Florida from the 

Southeast region are made by truck. 

The rapid spike in demand in advance of Irma made it difficult for gas stations and distributors to keep 

stations supplied as consumers filled up their cars and stocked up on fuel in preparation for uncertain 

conditions. During and immediately following the storm, impacts of Irma on infrastructure including 

ports, roads, and power, created challenges to moving fuel from terminals to retail outlets. To prepare, 

the industry put as much product as it could into the market in advance of the storm and staged 

products on both coasts to get fuel to Floridians as soon as it was safe and infrastructure allowed. 

4 
131 


II. Industry and Government Preparation and Response 

The state and federal governments and the refining and petrochemical industries were well-prepared 

for Hurricanes Harvey and Irma, having learned and applied lessons from previous storms. This 

preparation increased safety and minimized downtime and consumer impacts. In fact, following 

Hurricanes Katrina and Rita it took 91 days for the industry to return to 89 percent of pre-hurricane 

inputs. After Harvey and Irma, the industries returned to 88 percent of inputs only 29 days after 

landfall. 

In the wake of Hurricanes Katrina and Rita in 2005, the industries took steps to mitigate the impact of 

natural disasters. For example, many Gulf Coast refineries built and elevated refinery control rooms to 

avoid flooding and hardened them to withstand Category 5 storm wind speed. Refineries and chemical 

plants installed redundant power supplies and elevated generators and electrical systems to avoid 

flooding. Companies had also worked with local and state governments to develop alternative supply 

plans and establish clear lines of communication. 

More recently, in the wake of Superstorm Sandy in 2012, Secretary of Energy Ernest Moniz asked the 

National Petroleum Council ("NPC") to study vulnerabilities in the oil and gas infrastructure and effective 

ways for industry and government to communicate to address energy supply disruptions. By the time of 

the NPC study, the petroleum refining industry, especially along the U.S. Gulf Coast and post 

Katrina/Rita, had already taken significant steps to improve resiliency, response, and coordination~ and 

during the NPC study AFPM members and other petroleum industry participants were focused on how 

to improve communications with both the federal and state government(s) to streamline and support 

restoration and operations during and after an event. The NPC released its report in December 2014 

and made seven recommendations. As a general matter, the federal, state, and industry coordination 

was significantly improved compared to prior storms. AFPM offers a brief assessment on each of the 

NPC recommendations. 

Recommendation 

Harmonize DOE's energy response team 

structure with the National Incident 

Management System (NIMS) Incident 

Command System (ICS). 

Leverage 

Administration's subject matter expertise 

within DOE's energy response team to 

improve supply chain situation assessments. 

Establish company liaisons and direct 

communication with DOE's energy response 

team to improve situation assessments. 

AFPM Assessment 

AFPM is not in a position to fully evaluate the 

degree to which DOE's emergency response 

team structure was harmonized with the N!Ms 

ICS. 

AFPM is not in a position to fully 

EiA's expertise was utilized. However, 

and DHS situation reports were very 

although the DOE reports were 

___ "_, ____ """""----------J-'""-===-L..:..::==:::.:. ___ --c-------·-----1 4 Streamline and enhance processes for 

obtaining temporary regulatory relief to 

speed up recovery. 
132 


oil and natural gas industry in their energy 

assurance plans, and industry members 

should assist states in such efforts. 

exercises and the National Association of State 

Energy Official ("NASEO") exercises. AFPM has 

been involved in multiple DOE and NASEO 

exercises over the last couple of years to help 

DOE and state officials understand the oil and 

gas ("ONG") supply chain. Recently NASEO has 

developed a draft State Emergency Fuel Plan 

that has been shared with industry stakeholders 

for review and comment-which fs a great step 

toward states better understanding the fuel 

situation in their state and surrounding states. 

In the past each state had its own independent 

plans with varied degrees of detaiL Over the 

last couple of years, industries have increased 

their participation in DOE and NASEO exercises 

such as the annual DOE Clear Path exercises, the 

NASEO Uberty Eclipse exercise, and presented at 

f--l-------------------f-'N:':A::CS':'E:":O_:::_:=.:=:___-:c:---:---;--:---;:-;::;:---;----1 

6 Both DOE and states should establish 

routine education and training programs for 

key government emergency response 

positions. 

Both DOE and states should improve their 

comprehensive drill and exercise programs 

and include industry participation. 

Reciprocal invitations extended by 

companies to DOE and states are 

recommended. 

state responsiveness to this recommendation. 

DOE and states have made important strides on 

this recommendation. The quality of the 

exercises has improved, and the early 

engagement with industries to help develop the 

exercises has improved, as welL AFPM and 

other ONG members have participated in these 

exercises. Likewise, the ONG Sector 

Coordinating Council recently has been inviting 

L---L-------------------------------~D~O~E~to~l~n~dus~t~ry~e~x~e~rc~i~s~s_. ______________ ~ 

To prepare for these events, AFPM members will typically have a cross-functional emergency 

management team that includes operations, safety, security, human relations, purchasing, contracting~ 

and government relations. These teams develop comprehensive crisis management plans that include 

personnel responsibilities and plans for material support. The frontline of hurricane response are the 

ride-aut crews that actually stay at the refineries during the duration of the storm to address 

emergencies and facilitate access to the site later. ExxonMobil alone had 780 ride-aut crews at Baytown 

and Beaumont. This involves substantial logistical planning that includes accommodations, supplies, 

equipment, and communications capabilities. Companies plan for their vehicle, fuel, and power needs 

that may arise. 

In addition to the logistical issues associated with running a facility, refineries and petrochemical 

facilities must also remain vigilant regarding site security to ensure these national security assets are 

6 
133 


protected during the chaos of a major storm. This includes everything from ensuring entrances are 

guarded to providing essential employees with letters designating them as critical so they are able to 

travel during curfews. 

The response to Hurricanes Harvey and Irma was significantly improved compared to previous storms, 

particularly for regulatory relief and access. AFPM's members were particularly pleased with the 

communication and coordination between federal authorities and industries. The Department of 

Energy, Department of Transportation, Department of Homeland Security, and Federal Emergency 

Management Agency held daily joint calls with trade associations and companies representing critical 

infrastructure. These calls served to provide updates on issues like site access, port closures~ curfews, 

and the status of infrastructure, but also allowed industries to make officials aware of problems or 

questions. FEMA did an outstanding job taking access/reentry requests and state and local governments 

were very proactive communicating the local reentry procedures early, which helped avoid confusion 

later. 

Federal and state authorities took many actions to support an efficient and effective recovery effort, 

including expeditiously processing waiver requests. 

Fuels. On August 301

h, the Environmental Protection Agency ("EPA") granted a multi-state 

waiver for requirements of low-Reid Vapor Pressure ("RVP") conventional gasoline and 

reformulated gasoline ("RFG"). The next day, EPA expanded the waiver to include 38 states and 

Washington, D.C. These waivers are critical to allow refiners to make and sell winter-grade fuel 

that includes components like butane that can be used to increase the volume offuel supply. 

For most states, the low-RVP waiver expired on September lS'h with the usual switch to winter 

gasoline. In addition to the multi-state waivers by EPA, states waived state requirements for 

RFG and RVP specifications. For instance, Texas has a federally-enforceable Low Volatility State 

Implementation Plan (SIP) that was in place until October 1". 

FERC Tariffs, The fuel waivers granted by EPA are less effective if the fuel cannot be shipped 

through the pipeline infrastructure to reach consumers, even if it meets specifications. An issue 

arose when the Colonial Pipeline system refused to accept higher RVP gasoline (11.5#, also 

called A3 into Colonial) because it did not have a tariff on file with the Federal Energy Regulatory 

Commission ("FERC"). Prior to Harvey and the RVP turn (Sept lS'h), refiners had still been selling 

remaining inventories of lower RVP gasoline (9# or also called A2 into Colonial). Although all of 

the individual states along Colonial, and New York Harbor had granted RVP waivers, Colonial still 

required that all nominated volumes meet that specific pipeline product specification, even 

though that product would be downgraded when it co-mingled with all the inventory in the line. 

As a result of the delay, Colonial could not pump from Houston (West of Lake Charles) into its 

mainlines and reach its full one million bpd pump rate, resulting in a temporary disruption of 

supplies into Colonial and up through the Southeast/Northeast. At Colonial's request, FERC 

approved an emergency waiver tariff on September S'h Although this was resolved quickly, the 

issue resulted in a couple days of confusion and frustration for several refiners trying to move 

product into the market. 

Jones Act, The Jones Act requires cargo that is shipped between U.S. ports move on U.S.-

flagged ships that are built, crewed, and owned by U.S. citizens. As a result of its strict 
134 


requirements, shipping goods on a Jones Act vessel often costs as much as three times more 

than moving the same cargo a similar distance between a U.S. port and foreign location using a 

non-Jones Act vessel. On September 8'h the Department of Homeland Security waived the Jones 

Act for refined petroleum products shipped from New York, Pennsylvania, Texas, and louisiana 

to South Carolina, Georgia, Florida, and Puerto Rico, ahead of Hurricane Irma. On September 

ll'h the waiver was expanded to include shipments from all states in PADD lB (Central Atlantic) 

and PADD 3 (Gulf Coast) to all states in PADD 1C (lower Atlantic). 

Hours of Service Relief. Twelve states, including Puerto Rico and the U.S. Virgin Islands, 

declared states of emergency due to Harvey and Irma. In response, the Federal Motor Carrier 

Safety Administration issued an emergency declaration and waived Federal Motor Carrier Safety 

Regulations, including Hours of Service Regulations. These waivers allowed the trucking 

industry and AFPM member companies to more effectively support recovery and resupply 

efforts. 

Emergency Response Support. During response efforts fuels and other materials that may be 

regulated by the Pipeline and Hazardous Materials Safety Administration ("PHMSA") are 

essential elements to a quick recovery. To foster a more efficient response, PHMSA issued an 

Emergency Waiver of the Hazardous Materials Regulations to persons conducting operations in 

support of disaster and recovery efforts in Texas and louisiana. This waiver supported the 

movement of essential fuels and recovery products to impacted areas and aided in the recovery. 

For example, generators would typically be characterized as "dangerous goods" or "hazardous 

materials," triggering certain requirements for labeling and shipping documents. This waiver 

streamlined the ability of officials to quickly move these goods into affected areas. 

Pipeline Operator and Inspection Relief. Following the event to ensure safe operation of 

pipeline infrastructure, pipeline operators must conduct inspections and in some cases repair to 

damaged infrastructure. To assist in these effort PHMSA issued an emergency stay of 

enforcement for operators affected by hurricanes. This stay provided companies with a larger 

pool of skilled workers to aid in recovery. This relief aided in the recovery efforts and ensured 

essential mid-stream energy infrastructure resume operation quickly. 

Strategic Petroleum Reserve. The U.S. Strategic Petroleum Reserve ("SPR") is the largest 

government-owned stockpile of emergency crude oil in the world. Established in the aftermath 

of the 1973-74 oil embargo, the SPR provides the President with a powerful response option 

should a disruption in commercial oil supplies threaten the U.S. economy. It is also the critical 

component for the United States to meet its International Energy Agency obligation to maintain 

emergency oil stocks. The SPR has a design storage capacity of713.5 million barrels and as of 

late October held 670 million barrels. 

Crude can be made available from the SPR either as a drawdown and sale based on a Finding of 

a Severe Energy Supply Disruption or as a time exchange whereby the recipient receives crude 

from the SPR in exchange for a delivery of crude oil at an agreed future time. Following 

Hurricane Katrina, on September 2, 2005, President George W. Bush issued a Finding of a Severe 

Energy Supply Interruption that authorized and directed the Secretary of Energy to drawdown 
135 


and sell crude oil from the SPR. Following Hurricane Isaac in 2012 one million barrels of crude oil 

from the SPR were made available, and following Hurricanes Gustav and Ike in 2008, more than 

five million barrels were made available to refiners. 

Hurricane Harvey closed ports, disrupting marine delivery of crude oil to U.S. Gulf Coast 

refineries, and shut-in Gulf of Mexico oil production. The severe flooding from Harvey also 

disrupted the operation of pipelines that supply U.S. onshore and Canadian crude oil 

production, and shut in some U.S. onshore production. As a result, crude oil from the SPR was 

made available to refineries for delivery by pipeline. Through September 28, a total offive 

million barrels of oil from the SPR had been delivered to Gulf Coast refineries, helping to 

continue their processing operations and prevent further supply disruptions. 

Ill. The Industry's Dedicated Employees are the Heart and Soul of their Communities 

The devastation along the Gulf Coast brought daily images of heartbreak as lives were upended and 

many of those stories were about our employees, Yet, we also saw overwhelming support from the 

community-businesses to individuals, alike. 

The real story is about the employees themselves. There are too many stories to tell them all, but a few 

really stand out as great examples of the dedication of the U.S. fuel and petrochemical manufacturing 

industries' employees even as they had water pouring through their own homes. For instance, Dan 

Misko, an Exxon Mobil employee in Beaumont, Texas, and a team of about 60 people a combination 

of ExxonMobil personnel, city employees, and contractors worked with the city day and night to 

come up with a temporary solution to help restore its water service. The water dropped by Hurricane 

Harvey caused the Neches River to swell to more than 20 feet around the utility's pumping station, 

knocking out pumps at the city's water plant The plant processes more than 21 million gallons of water 

a day to serve a community of more than 100,000 people. Misko and team transported excess plastic 

pipes from the refinery to the water plant, and crews were deployed around the clock for the next 72 

hours to build eight, 600-foot-long pipelines. Eight temporary pumps were installed to help restore 

water service in Beaumont 

Jason Meyer, Rusty Till, and Pedro Alvarez, all employees of the Chevron-Phillips Chemical Company, 

took their boats and together rescued nearly two hundred people over the course of several days and 

helped ferry supplies and medical equipment. 

Industry-wide, as the flood waters receded, coworkers helped each other with housing, cleaning, and 

repairs. 

In addition to providing tens-of-millions of dollars in supplies and aid to local recovery efforts, AFPM's 

member companies sprung into action to provide relief for their employees and to help directly wtth 

recovery efforts. For instance, many companies offered displaced employees hotel rooms and longerterm housing, helped arrange for rental vehicles for those who lost cars, provided interest free loans, 

and helped underwrite the cost of out-of-network prescriptions and medical care. We had at least one 

member company paying for its maintenance crews to help clean up and repair employees' homes. 

IV. Recommendations and Conclusion 

9 
136 


The federal, state, JocaC and industry response was significantly improved compared to previous 

incidents, but there is always something to learn and improve upon, First and foremost, government 

must continue to find ways to coordinate efficiently among various agencies and jurisdictions while 

keeping lines of communication open with industry stakeholders. One particularly useful tool has been 

the DOE Clearpath exercise, a multi-stakeholder exercise that actually simulated a hurricane strike on 

the Gulf Coast this year. Such exercises help industry and government officials to know each other and 

develop lines of communication before disasters strike. Regular exercises also help educate federal and 

state officials about the fuel supply chain, which is extraordinarily complex, helping to improve decision 

making. One specific example of how this can be improved is that there was inaccurate and/or 

incomplete information about flooded highways and major roadways in Southeast Texas, which 

impacted companies' ability to plan safe routes for emergency supplies to flow to impacted sites. 

Companies have assets today that can help facilitate better information, but in some cases were unclear 

on whether/how they might be used. The best example is the use of commercial drones to help 

facilitate information needed for reentry procedures. AFPM urges the Federal Aviation Administration 

to establish guidelines on commercial drone use to facilitate emergency response operationsparticularly relating to utility and energy infrastructure restoration efforts-following a natural disaster. 

This guidance would help to speed up emergency response and energy facility reentry efforts following 

extreme weather events {as was recently seen with Hurricane Harvey), which would, in turn, ensure the 

safety of facility workers and the surrounding public. 

In addition to big-picture communications, there will undoubtedly be other lessons learned as 

governments and industry review the preparation, response, and recovery efforts. For instance, the 

high-water rescue assets provided by local government quickly became overwhelmed. The local U.S. 

Coast Guard responded quickly, but also had inadequate local resources at its disposaL In fact, at least 

one company quickly built a private high-water rescue capability, which was instrumental in several 

rescues of employees and families. Without the volunteer rescue assets, the Joss of life may have 

significantly increased. 

Furthermore, it is critical to review public communications about available fuel supplies. As with 

previous emergencies, retail fuel supplies were exhausted before landfall. This is not a new problem, 

but is a repeat problem for all significant storms. Within 24-48 hours prior to landfall, families were 

refueling all vehicles, as well as additional fuel for generators. This results in the initial non-availability 

of premium and diesel fuels followed by the lack of availability of regular grade gasoline at most 

stations. It is critical that the public be informed about the challenges with recovery, but are not 

induced to engage in "panic-buying." 

Finally, AFPM urges industry and government to take a comprehensive look at infrastructure 

development to work collaboratively to modernize areas of need. This may include everything from 

seawalls to drainage systems. For the refining and petrochemical industries, each company is already 

reviewing their own processes and procedures to make the next response even more effective. 

AFPM and its members look forward to identifying and discussing lessons learned with federal, state, 

and local policymakers to improve upon our response efforts for future storms. 

10 
137 


Appendix A-Refineries Impact by Hurricane Harvey 

Motiva Part Arthur Beaumont Port 

Arthur 

Total Part Arthur 

Valera Port Arthur Beaumont Port 

Arthur 

XOM Beaumont Be.aumrmi: ·' ;If~ ·· · ~tfbl!r 

Toto/ Beaumont/Port TOTAL Arthur 

Buckeye Texas Processing Corpus Christi 

Citgo Corpus Christi 

Flint Hills Carpus Christi Corpus Christi 

Magellan Condensate 

Splitter 

Valero Corpus Christi Corpus Christi 

Valero Three Rivers Corp!Js SirlStl 

Corpus Christi TOTAL 

Kinder Morgan Splitter Houston Galena Park 

Lyonde/1 Basel/ Houston Houston Refining 

Marathon Galveston Bay Houston 

Marathon Texas City Houston 

~!:! Fuel & Petrochemical 

Manufacturers 

603.0 

335.0 

1,525.8 

46.3 

296.5 

293.0 

84.0 

459.0 

11 
138 


AFPM 

Amerlcan 

fuel& Petrocllemical 

Manufacturers 

P66Sweeny Houston 247.0 

Pasadena Refining 

Petromax Refining Houston 25.0 Houston 

Shell Deer Park 

Valero Houston Houston 191.0 

Valero Texas City 

XOMBaytown Houston 

Houston 

Citgo Lake Charles 

P66 Westlake louisiana Gulf Cost 260.0 

Calcasieu Lake Charles 

Louisiana Gulf Coast TOTAl 789.0 

12 
139 


Appendix B-Energy Information Administration Supply Chain Maps 

Product Supply 

Texas inland (PAOO 3} 

® =Bulk Terminal 

0 =Refinery 

--= Product Pipeline 

.,_. = Explorer Pipeline 

=Urban Areas 

So~m:e: V,S, Eoorgy !nlonnetionAdminislratiOfl 

13 
140 


Product Supply 

Texas Gulf Coast {PAOD3) 

$ "' Bulk Termmal 

0 = Refinmg center 

0 "'Refinery 

- = Product Pipeline 

- "' Colonial Pipeline 

-*" = Explorer Pipeline 

=Bulk Terminal 

0 =Refinery 

@ = Refinery Center 

Sourcw: ttS, Eo\lf\JJI fnforrrratKmAdmin~lion 

14 
141 


Produet Supply 

Southeast- (PADD 1C} 

0 "' Bulk Termma! 

0 =Refinery 

- "' Product Pipeline 

"""""" "' Colonia! Pipeline 

- = Plantation PlpeHne 

-~ProductF!OWS 

15 
142 


Appendix C-The Refining Restart Process 

16 
143 


AFPM President and CEO 

Hurricane Harvey was arguably tile most signilicant storm impacting tile U.S. refining and 

petrochemicals industry, but our preparation and dedicated workforce helped the Industries 

weather the challenge. 

The amount of water dumped by Hurricane Harvey impacted 24 ret1neries with a quarter of U.S. refining 

capacity. The hurricane also affected 60 percent of Gulf Coast upstream petrochemical capacity 

(including ethylene and propylene), representing 58 percent of total U.S. chemical capacity. In addition 

to refining and petrochemical facility outages, the Hurricane also had a signit!cant impact on the supply 

chain. This included access to crude oil because of port closures and pipeline outages, but also logistical 

challenges with getting refined product from our facilities to consumers. 

Despite the logistical challenges, just two weeks after Harvey made landfall, 20 of these refiners had 

restarted or were in the process of restarting. Roughly two weeks after subsided, 28 percent of 

Gulf Coast upstream chemical capacity had restarted. !n fact, following Katrina and Rita it 

took 91 days tor the industry to return to 89 percent inputs. After Harvey and Irma, the 

industry returned to 88 percent of inputs only 29 days 

That our industries by and large withstood the storm and that is not by accident. Industry and 

governments both learned from previous that v,-e needed to improve working together. The 

government especially came through for the with better, accessible information. These partners 

deserve credit !or these improvements since previous incidents. 

Despite the challenge presented by Harvey, the fuel industry was prepared for Irma. There are no 

refineries in Florida, so Irma was more about a disruption in distribution and delivery of fuels. The 

refining industry's job is to get fuel to the people who need it. To do this the industry put as much product 

as it could into the market in advance of the storm and products on both coasts to get fuel to 

Floridians as soon as it was safe and infrastructure 

The federal and state response was significantly improved compared to previous storms 

Our industries didn't do this alone -our companies are by the communication and coordination 

exhibited between operators, first responders and state and local authorities exhibited throughout 

unprecedented scale and reach of these weather events. ln addition to the improved communication and 

coordination between the public and private sectors, both federal and state authorities were much quicker 

with the! waivers and other actions needed for an efficient and effective recovery effort . 

. Finally, as always, our companies will work with federal and state authorities to identify lessonslearned and prepare for the next disaster 

The federal, state, local, and industry response was significantly improved compared to previous 

incidents, but there is always something to learn and improve upon. The most important issue is 

communication, and governments must continue to find ways to coordinate efllciently among various 

agencies and jurisdictions while keeping lines of communication open with industry stakeholders. For the 

refining and petrochemical industries, each company is already reviewing their own processes and 

procedures to make the next response even more effective. 
144 

Mr. OLSON. Thank you, Mr. Thompson. 

The Chair now calls upon Mr. Max McBrayer. Max is the Chief 

Supply Officer for RaceTrac Petroleum, Incorporated. 

You have 5 minutes, sir. 

STATEMENT OF MAX E. MCBRAYER, JR. 

Mr. MCBRAYER. Thank you. Mr. Vice Chairman, Mr. Ranking 

Member, and members of the subcommittee, thank you for the opportunity to testify today on the retail community’s response efforts 

to 2017 hurricane season. 

My name is Max McBrayer. I am the Chief Supply Officer and 

the Chief Financial Officer of RaceTrac Petroleum, Inc. I am testifying today on behalf of the National Association of Convenience 

Stores and the Society of Independent Gasoline Marketers of America. RaceTrac is a family-owned business, headquartered in Atlanta, Georgia, operating more than 450 convenience stores across 

12 States and employing nearly 9,000 team members. 

The 2017 hurricane season had a devastating effect on America’s 

fuels infrastructure and markets. During Hurricane Harvey, flooding damaged more than a quarter of the U.S. refining capacity and 

shut down fuel pipelines. This put severe strain on the domestic 

fuel supply. Hurricane Irma led to an increased demand for fuel in 

Florida, further straining the fuels market and causing prices to 

rise sharply. 

Natural disasters directly and severely affect the retail fuels 

market. Margin on fuel sales range between 2 and 20 cents, and 

retailers must constantly react to changes in supply and demand 

to ensure their prices remain competitive. 

During any severe weather event, wholesale fuel prices become 

more volatile as the market tries to assess and anticipate supply 

availability. When these unwelcome changes occur, retailers respond to meet their cost. 

Due to the infrastructure damage, compliant fuel inventories became strained, leading to escalating wholesale prices. Retail market prices generally reflect rapid increase in the wholesale prices. 

In this instance, fuel retailers made individual decisions on whether to increase prices and risk losing customers or potentially take 

losses by keeping prices low and not covering the increased wholesale cost. 

Despite the tough situations, the fuel market was supported by 

the actions of both the Federal Government and the State governments. The governments worked with us to deal with the issues before, during, and after the hurricanes. 

Communication and coordination initiatives were particularly important. For example, the Governors of Texas and Florida held conference calls with industry and Government stakeholders where 

they listened to concerns and rendered prompt assistance. 

In Florida specifically, the Governor’s office waived certain restrictions for highways, helped ensure that ports prioritized fuel 

shipments, coordinated escorts for fuel trucks and ships, easing the 

movement of product to the retail fuel locations. 

At the Federal level, disaster response efforts spanned a number 

of agencies, which ultimately issued more than 30 waivers to help 

deal with fuel supply issues. Of particular importance to RaceTrac 

145 

was the waiving of hours-of-service limitations for drivers providing 

assistance to affected areas. These waivers were the difference between getting fuel to our customers in a reasonably affordable and 

timely manner and not being able to supply customers with the 

fuel they needed. 

In response to State petitions, Federal agencies also eased restrictions on the type of product that retailers could sell. For example, EPA temporarily waived certain reformulated gasoline requirements under the Clean Air Act. 

Despite the major disruptions to the fuel distribution system 

after the hurricanes, the impact on consumers and the economy 

was still less than what occurred with Hurricanes Katrina and Rita 

in 2005. This is because the Government worked with the private 

sector to respond appropriately. 

There are still important lessons to be learned, however. For instance, there is no good coordinated effort to make sure that consumers were informed of the status of fuel supplies via social 

media. As the hurricanes approached, we believe that much of the 

panic about fuel availability caused a significant and totally unnecessary pull on the available fuel supply. The panic lessened when 

information on the fuel supply was shared with the public. In addition, bottlenecking at ports and fuel terminals was a problem that 

the Government could have done more to alleviate. 

Finally, in the hurricanes’ aftermath, truck drivers and other employees found it difficult to get to affected areas quickly. Anything 

that can be done to remove hurdles for fuel transportation would 

speed up recovery efforts in the wake of future hurricanes. 

RaceTrac believes the collaboration between the public and the 

private sectors was critical to the successful response efforts. We 

are proud to have been able to serve the communities that we operate in. 

And I thank you for the opportunity to provide this testimony. 

[The prepared statement of Mr. McBrayer follows:] 

146 


Statement of 

Max E. McBrayer, Jr. 

Chief Supply Officer and Chief Financial Officer 

RaceTrac Petroleum, Inc. 

Atlanta, Georgia 

On Behalf of the 

National Association of Convenience Stores (NACS) 

And the 

Society of Independent Gasoline Marketers of America (SIGMA) 

Before the 

U.S. House Committee on Energy and Commerce, 

Subcommittee on Energy 

November 2, 2017 

Hearing on 

"The 2017 Hurricane Season: A Review of Emergency Response and 

Energy Infrastructure Recovery Efforts" 
147 


I. SUMMARY OF TESTIMONY 

J. The 2017 hurricane season significantly damaged the U.S. fuels infrastructure. 

Notwithstanding this damage, the Federal and state governments' timely action with 

regard to fuel, transportation, and other emergency waivers ensured that the retail fuel 

market had a continuous source of supply, benefitting American consumers. 

2. In addition, the unique and effective collaboration between state governments and the 

private sector in Florida and Texas mitigated the damage inflicted and enabled the market 

to respond swiftly and nimbly to the natural disasters. 

II. INTRODUCTION 

Chairman Upton, Ranking Member Rush, and members of the Subcommittee, thank you 

for the opportunity to testify today on the retail fuels community's recent hurricane disaster 

response efforts. My name is Max McBrayer, and I am the Chief Supply Officer and the Chief 

Financial Officer ofRaceTrac Petroleum, Inc. (''RaceTrac''). 

1 am testifying today on behalf of the National Association of Convenience Stores 

("NACS") 1 and the Society of Independent Gasoline Marketers of America ("SIGMA") 2 

Members of NACS and SIGMA, including RaceTrac, account for approximately 80 percent of 

retail motor fuels sales in the United States. 

The 2017 hurricane season was a historic multi-part weather event that tested the nation's 

fuel infrastructure to a degree previously unseen. Yet, it was also a moment of triumph for 

cooperation between the government and the private sector. In response to the situation 

surrounding Hurricanes Harvey, Irma, Maria, and Nate, the Federal government along with state 

governments expeditiously issued over 60 various fuel, hours of service, Jones Act, and 

Supplemental Nutrition Assistance Program waivers that enabled the marketplace to respond 

more quickly to the natural disaster. But the government did not act in a vacuum. The 

governments of Florida and Texas both opened effective direct lines of communication with the 

private sector, which enabled a degree of robust real-time collaboration never before seen. 3 This 

communication and collaboration permitted the market to address concerns swiftly as they arose 

1 NACS is an international trade association representing the convenience store industry with more than 2,200 retail 

and I ,600 supplier companies as members, the majority of whom are based in the United States. 

2 SIGMA represents a diverse membership of approximately 260 independent chain retailers and marketers of motor 

fuel. 

3 Other state governments assisted with the response efforts by waiving hours of service requirements for truckers 

transporting supplies to the affected areas. 

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and thereby lessened the harm from the hurricanes. My testimony addresses all of these points in 

greater detail below. 

A. BACKGROUND ON THE FUEL RETAILING AND CONVENIENCE 

INDUSTRY 

In 2016, the fuel wholesaling and convenience industry employed more than 2.3 million 

workers and generated $549.9 billion in total sales, representing approximately 3 percent of U.S. 

Gross Domestic Product. Of those sales, approximately $317 billion came from fuel sales alone. 

Because of the number of fuel and other transactions in which the industry engages, fuel retailers 

and marketers handle approximately one of every 30 dollars spent in the United States. Fuel 

retailers serve about 160 million people per day-around half of the U.S. population-and the 

industry processes over 73 billion payment transactions per year. Nevertheless, the convenience 

store and fuel retail industry is truly an industry of small businesses. Approximately 63 percent 

of convenience store owners operate a single store. 

The fuel wholesaling and convenience store market is one of the most competitive in the 

United States. Fuel retailers operate on tiny margins (around 2 percent or less) and are unable to 

absorb incremental cost increases without passing them on to consumers. Today, there arc 

approximately 150,000 retail fueling facilities throughout the nation, and less than 5 percent are 

owned and operated by the integrated oil companies. The majority are owned by independent 

companies, whether single-store operators or regional chains, and each of these businesses have 

different approaches to how they buy and sell fuel. 

B. ABOUT RACETRAC 

Headquartered in Atlanta, Georgia, family-owned RaceTrac has been serving guests since 

1934 and now operates more than 450 convenience store locations and employs nearly 9,000 

team members. Every day, RaceTrac operates under its mission to "make people's lives simpler 

and more enjoyable"-and for that reason, the company has been named a top workplace across 

many of the states in which it operates, and has been recognized on the Forbes list of largest 

private companies every year since 1998. In fact, in 2014, Convenience Store Decisions named 

RaceTrac as its "Chain of the Year." 

RaceTrac Petroleum, Inc. is composed of two operating retail divisions: RaceTrac and 

RaceWay, and a mix of subsidiaries. RaceTrac operates more than 450 RaceTrac retail fuel and 

convenience stores across four southern states: Georgia, Florida, Louisiana, and Texas; and also 

owns 250 contract-operated RaceWay retail fuel and convenience stores in 12 states (Alabama, 

Arkansas, Florida, Georgia, Kentucky, Louisiana, Mississippi, North Carolina, South Carolina, 

Tennessee, Texas, and Virginia). Energy Dispatch, the transportation company that hauls fuel for 

RaceTrac, endeavors to provide the best-in-class fuel hauling services for RaceTrac and 

RaceWay. Metroplex Energy is a wholesale fuel supplying company that secures bulk fuel to 

supply RaceTrac and RaceWay stores and other third-party companies by rail, pipeline, truck, 

barge and vessel. 

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Due to RaceTrac' s presence in 12 states, we play an important role in providing fuel to 

consumers in different markets-and we arc fully aware of the many statutory, regulatory, 

logistical, and other factors that affect different fuel markets. Each day, we must ensure that our 

stores remain stocked with the fuels that meet the required federal and state specifications of a 

particular market. In addition, because we operate throughout the Gulf Coast and along the 

Southeastern United States,4 we are very attuned to the weather risks and logistical impediments 

that may impact our ability to supply our retail locations-and were directly affected by the 2017 

hurricane season. As described in more detail below, we learned from that most recent 

experience that effective public-private sector collaboration is essential to ensuring the 

successful functioning of the retail fuels market during a natural disaster. 

III. U.S. FUEL MARKET INFRASTRUCTURE & HURRICANES 

Fuel industry infrastructure spans across the country, making up a complex system of 

interconnected refineries, blenders, pipelines, terminals, transporters, and retailers. As with other 

supply chains, disruption in even one area can cause a ripple effect to spread throughout the 

entire industry. During natural disasters, those effects are often more dramatic, as disruption may 

occur across more than one part of the supply chain. The hurricanes of the past summer wrought 

harm to much of the fuel supply chain, from manufacture to retail. 

In late August, Hurricane Harvey made landfall in Texas, ultimately dumping more than 

50 inches of rain on affected areas and setting the record for the most rainfall ever recorded in 

the continental U.S. from one storm. 5 The rain and winds adversely affected the ability of fuel 

retailers to operate-both in terms of acquiring necessary fuel supply and delivering that fuel out 

to customers. More damaging, however, was the severe flooding, which was severely detrimental 

to the fuels infrastructure. Many fuel dispensers ended up underwater and out-of-service and the 

flooding crippled the fuels market from the point of manufacture, immediately shutting down 

about I 0 out of the 141 U.S. refineries-and ultimately damaging about 48 total refineriesmeaning that more than one-third of the nation's refining capacity was harmed by the hurricane. 

The effects of refinery closures, as well as pipeline closures, 6 spread across the country and up 

the Eastern seaboard, resulting in limited fuel supply and causing fuel prices to rise sharply. 

4 For example, Florida is home to more than 200 RaceTrac stores and more than 40 RaceWay locations (this number 

can vary as new stores open, but as of the date of this testimony, there are around 250 total in the state); Texas is 

home to more than 110 RaceTrac stores and 50 RaceWay locations (again, numbers can vary, but there are around 

160 stores in Texas). 

5 Erin Brodwin and Skye Gould, Rains from Hurricane Harvey Broke 60 Years of U.S. Continental Records- Here's 

Why, Bus. INSIDER (Aug. 29, 20 I 7}, www.businessinsider.com/harvey-rain-rainfall-break-record-20 17-8. 

6 Colonial Pipeline Co, which transports product from Texas to the Eastern seaboard, and Explorer Pipeline, which 

transports product from Texas north to the Midwest, both closed temporarily due to effects from Hurricane Harvey. 

Other pipelines affected included certain Magellan Midstream and Kinder Morgan pipelines. 

See Catherine Ngai, Key Fuel Lines Restart as Concerns Ease over Supply Crunch after Harvey, REUTERS (Sept. 3, 

20 17), https://www.reuters.com/article/us-storm-harvcy-cnergy/key-fuel-lines-restart-as-concerns-ease-over-supplycrunch-after-harvey-idUSKCNIBEOIO; see also Kenneth Rapoza, Here's How Many Barrels of Oil Have Been Lost 

4 
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As refineries and pipelines slowly began to re-open after the damage wrought by 

Hurricane Harvey, Hurricane Irma headed towards Florida where state and local officials issued 

mandatory evacuation orders, leading to increased demand for fuel in anticipation of the storm. 

Florida does not receive fuel via pipeline-its markets rely on trucks, tankers, and barges. Prices 

in Florida already had begun to rise in the state due to disruptions in the overall U.S. fuel supply 

chains resulting from Hurricane Harvey. The subsequent diversion of land and sea traffic due to 

Hurricane Irma, as well as the significant wind damage created once the storm made landfall, 

further affected the Florida fuels market and caused prices to rise even higher; in some places, 

prices increased by up to $0.40/gallon. The fuels market was further battered by Hurricanes 

Maria and Nate, which dealt blows to Puerto Rico and oil production in the Gulf of Mexico, 

respectively. 

On a normal day, prices fluctuate in the retail fuels market. This is because the fuel 

commodities market is one of the most competitive commodities markets in the nation. In fact, 

margins on fuel sales often fluctuate between 2¢ - 20¢ and retailers must constantly react to 

changes in supply and demand to ensure that their prices remain competitive; the price on the 

sign is often the sole factor driving consumers' decisions about where to buy fuel. In a rapidly 

escalating wholesale market, retail market prices generally reflect the increase in the wholesale 

price. Retailers generally attempt to generate sufficient revenues to cover the costs of replacing 

the inventory which they have just sold. This phenomenon is most noticeable in markets where 

wholesale prices are escalating rapidly. 

Price fluctuations during emergencies are unavoidable. During any severe weather event 

or catastrophe, including a hurricane, wholesale fuel prices become more volatile as the market 

tries to assess and anticipate supply availability and as access to wholesale product may become 

restricted. When these unwelcome changes occur, retailers respond to meet their costs (often at a 

fairly quick rate). With the effects of refinery and pipeline closures due to Hurricane Harvey 

impacting the market, supply during Hurricane Irma was limited, putting dramatically increased 

pricing pressure on fuel retailers, who then made individual decisions on whether to increase 

prices and risk losing consumers, or potentially take losses by keeping prices low (and not 

covering their increased wholesale replacement costs). It is also important to note that the supply 

concerns arising during the autumn hurricane season are always exacerbated by the transition 

from summertime to wintertime fuel that occurs on September IS"'. This is because in the weeks 

leading up to the transition (and during the middle of the most active part of the hurricane 

season), everyone is drawing down on inventories at exactly the time when we need product in 

place. In other words, inventories of product that is usable through September 15th are being 

drawn down to minimums at the same time the inventories of product for use after September 

15th are being built. 

Seeking to mitigate the infrastructure impediments and the resulting negative market 

effects of the hurricanes, both the Federal government and state governments worked with fuel 

to Hurricane Harvey, FORBES (Aug. 28, 20 17), https://www.forbes.com/sites/kenrapoza/2017/08/28/heres-howmany-barrels-of-oil-have-becn-lost-to-hurricane-harvey/2/116d8bbe04637c. 

5 
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industry stakeholders in an attempt to preempt negative effects of the storms, as well as deal 

effectively with the aftermath 

IV. HURRICANE RESPONSE EFFORTS 

The clear communication between state governments and the private sector and the 

timely response efforts of the Federal government were essential to our ability to effectively 

respond to the disaster. 

A. STATE EFFORTS 

State-level communication and coordination initiatives were critically important to fuel 

retailers' hurricane preparation and recovery efforts, and helped minimize service disruptions 

caused by Harvey and Irma. In Texas, Governor Greg Abbott's team held conference calls with 

the local state associations, including the Texas Food and Fuel Association, local retailers, and 

emergency responders-and the state was instrumental in petitioning the Environmental 

Protection Agency for fuel waivers to address supply concerns. Florida Governor Rick Scott and 

his administration deserve special recognition for their close engagement with a wide range of 

stakeholders in the fuel supply system during Hurricane Irma. Governor Scott led daily (and 

sometimes twice-daily) conference calls that included federal disaster response officials, 

convenience and fuel retailers (including NACS, the Florida Petroleum Marketers Association, 

and individual companies including RaceTrac), oil companies, terminal operators, and other 

segments of the supply chain before, during, and after the storm. The governor's office listened 

closely to industry concerns and rendered prompt assistance. For example, to help retail locations 

stay open as long as possible, the governor arranged for state police to help employees who 

stayed on the job until the last minute get to evacuation centers with their families. 

Working with federal and local officials, the governor's office also rescinded weight and 

driver restrictions for highways, helped ensure that ports prioritized fuel shipments, and 

coordinated police and military escorts for fuel trucks and ships, easing the movement of product 

from tankers and barges, through ports and terminals, to retail fuel locations, and ultimately 

consumers' gas tanks. In addition, the state governments requested the fuel waivers that are 

discussed in further detail below. These are just a few examples of exemplary state-level actions 

highlighting the importance of real-time communication and cooperation between multiple levels 

of government and the fuel industry to ensure supply stability during a natural disaster. 

B. FEDERAL EFFORTS 

At the Federal level, disaster response efforts spanned a number of departments and 

agencies, including the Environmental Protection Agency (EPA), the Federal Motor Carrier 

Safety Administration (FMCSA), the Federal Energy Regulatory Commission (FERC), the 

Internal Revenue Service (IRS), the Department of Homeland Security (DI·IS), and the U.S. 

Department of Agriculture (USDA) 7 Between the end of August, as Hurricane Harvey bore 

7 The focus of this testimony is on the fuel supply chain. but the prompt efforts of USDA to provide emergency 

Supplemental Nutrition Assistance Program (SNAP) benefits and waive SNAP hot foods restrictions was critical to 

making sure hurricane victims had access to food. 

6 
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down on Texas and Louisiana, to the end of September and even into October as Hurricanes 

Maria and Nate affected the Eastern U.S. coast, Federal agencies responded to state petitions and 

expeditiously issued more than 30 waivers in an effort to respond to fuel supply issues and 

prevent future problems. 8 

Of particular importance to RaceTrac were FMCSA's regional emergency declarations, 

which waived hours of service limitations and certain fee requirements for drivers providing 

direct assistance to states affected by the disasters. In a time of emergency, these waivers 

allowed drivers to quickly and efficiently travel through surrounding states to gain access to 

affected areas, enhancing supply lines and allowing vital goods, including fuel, to get to those in 

need. For RaceTrac, these waivers were the difference between getting fuel to our customers in a 

reasonably affordable and timely manner, and not being able to supply members of our 

communities with the fuel they needed. 

Aside from improving transportation of goods during the emergencies, Federal agencies 

also eased restrictions on the type of product that could be sold by retailers.9 This is significant 

because the U.S. fuels market is characterized by "boutique" fuels, the natural result of states and 

municipalities implementing diverse fuel specifications for different geographic areas in order to 

reduce emissions and otherwise meet weather/seasonal needs. This means not all fuel is fungible: 

certain types of fuels can be used in some parts of the country but not in others-so when there 

are supply constraints, it can quickly become difficult for retailers to find market compliant fuel 

to sell. Thus, the fuel waivers issued by EPA, which relaxed fuel specification requirements in an 

assortment of geographical areas, were extremely important because they enhanced fuel 

fungibility and facilitated the speedy acquisition of fuel. For example, to "minimize or prevent 

the disruption of an adequate supply of gasoline," EPA waived certain reformulated gasoline 

requirements (RFG). In addition, EPA temrcorarily eliminated restrictions on the use of gasoline 

that contains 15 percent ethanol (i.e., E 15), 0 effectively ending the summer ban and allowing the 

sale of E 15 in 38 states and the District of Columbia. 11 

EPA's timely response to market conditions led to the issuance of these and many 

necessary fuel waivers that were critical in helping fuel retailers, particularly small independent 

operators, to get product out to consumers and thereby lessening the impact of these natural 

disasters. In short, for many fuel retailers, these waivers were vital to ensuring they could keep 

their retail fuel locations "wet" (i.e., supplied with fuel). Given RaceTrac's sophistication with 

regard to its fuel supply, however, EPA's fuel waivers were less significant to the day-to-day 

8 For a compilation offCderal and state waivers, see SIGIV1A, Hurricane Waivers and Resources, 

https://www.sigma.org/hurricane-harvey. 

9 For example, recognizing the existence (or beginnings of) diesel fuel shortages, the IRS waived penalties related to 

the use of certain types of diesel fuel on highways. 

10 Generally, fuel retailers are not allowed to sell El5 during the summer months, as it is considered too volatile and 

has less favorable emission characteristics. 

" See e.g., August 31, 2017 Waiver, https://www.epa.gov/sites/production/files/2017-

08/documents/secondmu1tistate0831l7.pdf. 

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running of our business during the hurricane than were FMCSA's and various states' hours of 

service waivers. Nevertheless, the importance of the fuel waivers for the marketplace cannot be 

understated. 

DHS also tried to boost the fuel industry supply chains when it waived the Jones Act 12-

a law requiring goods shipped in the U.S. to be carried aboard U.S. vessels. 13 This waiver was 

designed to enable fuel to reach areas in need more quickly, regardless of the vessel transporting 

it. This was particularly important in Florida, which is not supplied by pipeline, and receives the 

majority of its fuel by ship or truck. 

C. SUCCESSES, LESSONS LEARNED, GOALS FOR THE FUTURE 

The many successes of the 2017 hurricane response efforts stand in stark contrast to what 

occurred during Hurricanes Katrina and Rita in 2005, when fuel supply and distribution 

disruptions led to chaos in the marketplace. This is all the more remarkable since the 2017 

hurricane season had a more substantial and sustained impact on U.S. refining capacity and the 

two major pipelines (Explorer and Colonial) compared to the 2005 hurricane season. 14 In short, 

despite the major disruptions to the fuel distribution system after Hurricanes Harvey and Irma, 

the impact on consumers and the economy were significantly less than in 2005 because the 

government behaved much differently. 

In the chaos after Katrina, the government confiscated or commandeered distribution 

equipment to respond to the emergency; in this instance, the public and private sector worked 

together to respond to the crisis. From this experience, we have learned that communication and 

collaboration are the keys to success. In preparation for a major weather event, it is important for 

government to have a "response checklist" of what needs to happen when, share that checklist 

with the private sector, and coordinate with the private sector to expand and effectuate that 

checklist. For example, rather than telling industry what to do, the Governors of Texas and 

Florida conducted regular communications with industry via open telephone conferences to 

troubleshoot issues. 15 They asked the private sector what to do and when; and there was real-time 

12 The first Jones Act waiver was issued on September 8, 2017, 

https:/ /www .dhs.gov /sites/ default/files/pub I ications/ I 7 _. 0908 _AS !_Jones-Act-Waiver. pdf. 

13 The Jones Act prohibits the transportation of cargo between points in the U.S., either directly or via a foreign port, 

or for any part of the transportation, in any vessel other than a vessel that has a coastwise endorsement (e.g. a vessel 

that is built in and owned by persons who are citizens of the United States). See 46 U.S.C 55102, stating "a vessel 

may not provide any part of the transportation of merchandise by water, or by land and water, between points in the 

United States to which the coastwise laws apply. either directly or via a foreign port" unless the vessel was built in 

and documented under the laws of the United States and is wholly owned by persons who are citizens of the United 

States. 

14 Rita and Katrina Have Shut 23 Percent of U.S. Oil Refining Capacity (Sept. 22. 2005), NY TIMES online, 

http://www.nytimes.com/2005/09/22/business/rita-and-katrina-have-shut-23-percent-of-us-oil-refiningcapacity.html. 

15 The governors opened lines of communication before the disaster struck and maintained those lines of 

communication during the hurricanes to ensure that the retail community and the government could respond and 

adapt to the communities' needs. 

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cooperation to respond to an ever-changing threat landscape. Such cooperation with industry is 

unique-and it is commendable. 

Notwithstanding these successes, there are important lessons to be learned and goals to 

improve future response efforts. While there were open lines of communication to discuss onthe-ground response before and during the disasters, there was no concerted effort to shape the 

discourse on social media. As such, panic hit before and immediately after the hurricanes 

touched down and there was an instantaneous and significant pull on the available fuel supply. 

However, once people were appropriately informed there would be gasoline available, the 

market calmed and convenience store supply repositories stabilized. In short, once the 

government and the private sector was able to break through the social media "noise" and panic, 

we were able to alleviate anxiety and lessen the stress on the available supply. From this, 

therefore, I urge governments and the private sector to also plan to coordinate information 

campaigns to the public prior to weather events to preemptively contain the panic that is prone to 

ensue. 

In addition, bottlenecking at ports and fuel terminals has been a recurring theme this 

hurricane season, and federal and state governments could do more to help alleviate the problem 

during future natural disasters. For example, this Committee could consider a legislative solution 

that would grant truck drivers and other employees critical to fuel delivery some kind of 

temporary "responder" status that would relax port authority access restrictions to allow nonlocal truck drivers temporary access to ports in affected areas in emergency situations. 

A temporary "responder" designation would also help mitigate a related challenge that 

RaceTrac and similarly situated companies experienced during the recovery process: in the 

hurricanes' aftermath, truck drivers and other employees critical to fuels systems operation found 

it extremely difficult to get into affected areas promptly. After Harvey, for example, when many 

of our Houston-based employees were stranded by flooding, we tried to send in employees from 

other in-state and out-of-state locations. Ultimately, however, those employees were unable to 

proceed much farther than Dallas, and could not get to the Houston area in a timely fashion. 

Anything state and federal government agencies can do to remove logistical hurdles for fuel 

transportation (e.g., special consideration by state law enforcement, port authorities, or federal 

disaster response officials) would significantly expedite fuel supply recovery efforts in the wake 

of future hurricanes. 

V. CONCLUSION 

RaceTrac believes the swift collaboration between the public and private sectors was 

critical to the successful response to the 2017 hurricane season, and is proud to have been able to 

successfully serve many communities throughout the Gulf Coast and the Eastern seaboard during 

this difficult time. 

Thank you for the opportunity to testify before you today. I am happy to answer any 

questions you may have. 

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155 

Mr. OLSON. Thank you, Mr. McBrayer. 

The Chair now calls upon the honorable Ramon Luis Nieves, who 

is now an attorney at law, was a former distinguished member of 

the Senate of Puerto Rico. 

You have 5 minutes for an opening statement, sir. 

STATEMENT OF RAMON-LUIS NIEVES 

Mr. NIEVES. Thank you, Chairman Olson, Ranking Member 

Bobby Rush, members of the subcommittee. 

My name is Ramon-Luis Nieves. I had the privilege to serve the 

people of Puerto Rico as senator of San Juan and chairman of the 

Committee on Energy. I currently practice law in the State and 

Federal courts of Puerto Rico. 

I want to thank the subcommittee for this opportunity to discuss 

Puerto Rico’s energy challenges. As a resident of San Juan, I have 

personally suffered the problems associated with the lack of electricity for more than 40 days. The currently energy crisis is destroying our economy and our way of life. 

Nobody denies the challenges of repairing the collapsed energy 

grid of Puerto Rico, but I submit to you that most of the challenges 

to turn the lights back on in Puerto Rico are neither natural nor 

geographic. They are manmade. 

The Puerto Rico Electric Power Authority, PREPA, was already 

a bankrupt, fragile, and useless entity before Hurricane Maria 

made landfall. The Power Authority’s grid was obsolete, lacking 

adequate maintenance. 

The recent Whitefish debacle is exhibit A of the governance 

issues plaguing PREPA. As we evaluate energy options for Puerto 

Rico, we must be particularly alert about disaster contractors who 

may try to take advantage and profit off of our people’s misery. 

But I didn’t take two flights from San Juan to complain about 

PREPA. I come before you with proposals to help us transform 

Puerto Rico’s energy model. 

Energy equals life. As most Puerto Ricans sadly understood after 

Hurricane Maria, the lack of a strong, resilient, and smart energy 

system has the potential of killing people and destroying the economy. The actual death toll not of Hurricane Maria, but of Hurricane PREPA has not been properly disclosed by the government of 

Puerto Rico. 

While working hard to turn the lights back on as soon as possible, policymakers must also think long term. A plan to transform 

Puerto Rico’s energy model, supported by significant Federal support funding, is the right course of action. 

Technology and innovation are transforming the energy industry. 

Puerto Rico must break free from PREPA’s centralized energy 

model. The people of Puerto Rico deserve an energy model whereby 

more and more customers are able to opt for distributed generation 

or go off the grid in their homes and business. 

Policymakers are agreeing with the idea of a new energy model 

based on several regional microgrids. Microgrids for key Government security and health installations, such as hospitals, will also 

help recovery efforts after future storms and hurricanes. 

The mandate to regulate microgrids is already in our law books. 

Act No. 133 from last year the last bill that I sponsored in the SenVerDate Mar 15 2010 12:53 Mar 12, 2018 Jkt 037690 PO 00000 Frm 00159 Fmt 6633 Sfmt 6633 C:\USERS\WLAUFERT\DESKTOP\115X72X2017HURRICANESWORKING WAYNE
156 

ate, to include microgrids as a mandate. However, a Federal mandate to include microgrids in a new energy model for Puerto Rico 

will certainly help. 

PREPA has also pointed out that the Stafford Act restricts to rebuild the grid as it was. Perhaps you may be able to change that 

by amending Federal law. 

PREPA’s old, and now collapsed, grid is not able to deal with the 

technical challenges of an energy model that embraces renewable 

power. However, as I have said, countless policymakers agree that 

just repairing the old, obsolete energy grid of Puerto Rico will be 

a colossal waste of taxpayer dollars. PREPA is broke. So, the Federal Government is the only entity able to finance this key project. 

Let’s talk about PREPA’s governance. The Whitefish scandal is 

a sad example of the shameful and incompetent governance that 

characterizes PREPA. PREPA awarded a no-bid $300 million contract to an unknown company with just two employees. The Government recently requested PREPA to cancel the contractual agreement, but 40 days after Hurricane Maria, and hundreds of deaths 

later, PREPA did what it should have done from the start, request 

the mutual aid offered by private and public electric companies. 

But where was PREPA’s governing board? Nobody really knows, 

but I submit to you that this Whitefish business is very harmful 

to Puerto Rico’s credibility. 

Very quickly, since my time is almost up, PREPA collapsed 

under its $9 million debt. Congress, the administration, and the 

oversight board must create a financial solution for PREPA’s debt. 

Aggressive restructuring of the debt, combined with new Bradytype bonds and continued oversight over PREPA, could be a way 

to solve this monumental problem. 

And just to finish up, the most efficient way to transform the energy model of Puerto Rico is by giving the proper resources to Puerto Rico’s independent energy commission. An independent and 

strong regulator is key for our recovery. In order to guarantee the 

Federal funds to build a new energy grid are properly used and allocated, I propose that the Revitalization Coordinator of Puerto 

Rico under PROMESA and the Puerto Rico Energy Commission be 

given sole authority over PREPA. PREPA shall cease to exist in its 

present form. 

Just to wrap up, thank you for the opportunity. The people of 

Puerto Rico urgently need to turn their lights back on, but we also 

demand the resources to create a new energy model for our island. 

Our lives depend on it. 

Thank you. 

[The prepared statement of Mr. Nieves follows:] 

157 


Testimony of Ramon-Luis Nieves, Esq., 

former Senator and Chairman of the Committee on Energy, 

Senate of Puerto Rico, 

before the Subcommittee on Energy, 

Committee on Energy and Commerce 

U.S. House of Representatives 

November 2, 2017 

"The 2017 Hurricane Season: A Review of Emergency Response and 

Energy Infrastructure Recovery Efforts" 

Chairman Fred Upton, Ranking Member Bobby Rush, members of the 

Subcommittee on Energy: 

My name is Ramon-Luis Nieves. I had the privilege to serve the people of 

Puerto Rico as a state senator, representing the District of San Juan. After my return 

to the private sector, I founded RL Legal & Consulting Services, LLC. I currently 

practice law in the state and federal courts of Puerto Rico. 

I want to thank the subcommittee for this opportunity to discuss Puerto Rico's 

energy challenges. Puerto Rico is suffering from the longest blackout in U.S. history. 

As a resident of San Juan, I have personally suffered the problems associated with 

the lack of electricity for more than forty days. The current energy crisis is destroying 

our economy and our way of life. Our friends and families are emigrating by the 

thousands. The government estimates that close to 15% of our population will 

emigrate as a consequence of Hurricane Maria and the subsequent lack of energy. 

More than forty days after Hurricane Maria made landfall, several million 

Puertoricans, U.S. citizens, lack electricity in their homes and businesses. The 

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businesses that have been able to open, are testing the limits of their power 

generators. 

Nobody denies the challenges of repairing the collapsed energy grid of Puerto 

Rico. 80% of the grid was destroyed by a category 5 Hurricane. The Islands of Puerto 

Rico have a mountainous geography. Trucks from energy companies cannot arrive 

the next day after a natural disaster, since this U.S. territory is an Island (surrounded 

by "water, big water", as the President stated a few weeks ago). 

But I submit to you that most of the challenges to "turn the lights back on" in 

Puerto Rico are neither natural, nor geographic: they are man-made. 

The Puerto Rico Electric Power Authority of Puerto Rico (PREP A) was already 

a bankrupt, fragile and useless entity before Hurricane Maria made landfall. The 

power authority's grid was obsolete, lacking adequate maintenance. For years, 

consumers and businesses have suffered from high energy costs, unreliability and 

constant interruptions. 

PREPA was one of the "crowning jewels" of the mid-Twentieth Century 

economic miracle that transformed Puerto Rico. In just forty (40) years, PREP A 

accomplished its original mission: to provide total electrification to the residents of 

Puerto Rico. 

The utility currently struggles to operate a centralized grid, where power 

generation is based in the southern part of Puerto Rico, while most of the energy 

consumption concentrates in the North. PREP A owns and operates a centralized 

energy system: power generation, transmission and distribution infrastructure are 

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controlled by the public corporation. Two private entities AES (coal) and Ecoelectrica 

(natural gas), and several utility scale renewable energy projects, sell their energy to 

PREP A. These private entities account for more than a third of the Island's electric 

power generation. As is the case with most Island electric power systems, which are 

isolated systems, PREP A depends mostly on imported oil to generate energy. 98% of 

all electricity in Puerto Rico is generated by burning fossil fuels. 

As accurately described by the Center for the New Economy, PREP A operated 

for more than 70 years as a tax-exempt, self-regulated, public monopoly, with broad 

powers including unsupervised rate-making, and debt-issuing authority. 

Congress's decision to repeal the IRC Section 936 tax incentive regime, Puerto 

Rico's manufacturing backbone, precipitated a deep economic depression, now on its 

eleventh year. High oil prices, continued migration of thousands of residents, and 

industries closing, severely affected the revenues of the utility. PREPA and the 

governing political parties of the Commonwealth refused to adapt. They rather chose 

the slippery slope of enormous borrowing. In 2010, 2012 and 2013, PREP A authorized 

ten (10) bond emissions, for a combined amount of $5.3 billion in debt. 

But PREP A was not just financially broke before Maria made landfall. Politics 

also destroyed the utility's chance to transform itself. The improper intervention of 

local political factions undermined PREPA's decision making for years: from its 

governing board, full of political cronies, to its day-to-day management, and even the 

recruiting process of its employees. At the start of any new administration of the 

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government of Puerto Rico, the prevailing party awards its loyalists with numerous 

management and technical posts at PREP A. Any recently elected politician is 

overwhelmed by hundreds of petitions from party loyalists to 'facilitate' recruitment 

at PREP A, known for its generous labor benefits. For years, political organizations 

operating at the heart of the utility raised thousands of dollars in campaign 

contributions. Bondholders, brokers, consultants, political parties, fuel suppliers, and 

others have used PREP A as a cash cow since forever. 

The recent Whitefish debacle, which I'll address later, is Exhibit A of the 

governance issues plaguing PREPA, which affect the recovery efforts. PREPA has 

historically ignored legal mandates, such as the ones ordering it to embrace 

renewables and regulate wheeling, for example. Weak and politically dependent 

governing boards frequently cede control to the Governor's Mansion (La Fortaleza). 

Transparency is such a joke at PREP A, that the unions usually assume the role of 

spokespersons for the utility. PREP A became such a politically powerful force over 

the decades, that no Legislature dared to perform adequate oversight. That is, until 

2014, when the Senate of Puerto Rico stepped up to the challenge. 

But I didn't take three flights from San Juan to complain about PREP A. I come 

before you with proposals to help us transform Puerto Rico's energy model. 

Energy equals life. As most Puertoricans sadly understood after Hurricane 

Maria, the lack of a strong, resilient, and smart energy system has the potential of 

killing people, and destroying the economy. Official government figures currently 

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place the death toll of Hurricane Maria at 59. But that statistic is misleading. Recent 

reports state that the government authorized almost a thousand cremations. Also, on 

a personal note, dozens of friends have shared with me countless stories of their 

elderly loved ones dying as a result of the lack of electricity in their homes, hospitals 

and care·centers. The actual death toll, not of Hurricane Maria, but of Hurricane 

PREP A, has not been properly disclosed by the government of Puerto Rico. 

While working hard to "turn the lights back on" as soon as possible, 

policymakers must also think long term. Puerto Rico's short term recovery, and future 

prospects of economic development, depend on building a new energy grid. Countless 

policymakers already agree that just repairing the old, obsolete energy grid of Puerto 

Rico will be a colossal waste of taxpayer dollars. Governor Ricardo Rossell6, President 

Donald Trump, the Department of Energy, the Puerto Rico Energy Commission, 

senators and representatives, as well as the energy industry, all agree that a plan to 

transform Puerto Rico's energy model, supported by significant federal funding, is the 

right course of action. 

A decentl'alizcd enel'gy system 

PREP A has historically adhered to the old utility model, which until recently 

had not changed much since the times of Thomas Alva Edison. In the old, centralized 

model, energy consumers had a passive relationship with their utility. They received 

electricity generated, transmitted and distributed by the utility, and payed their bills. 

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Technology and innovation are transforming the energy industry. The 

development of batteries for storage, lower costs or more favorable financing models 

for the renewable market, net metering, microgrids and community-shared solar, are 

disrupting the old utility business model. Energy consumers now have the option to 

become active elements of the equation, not just passive consumers. 

Puerto Rico must break free from PREPA's centralized energy model. The 

people of Puerto Rico deserve an energy model whereby more and more consumers 

are able to opt for distributed generation; net metering in their homes and business, 

or opting to go "off the grid", with the combination of renewables and storage; a 

system that regulates and allows wheeling for the industrial sector, so they can opt 

to purchase their power from private generators, offering more competitive rates than 

the utility. 

Creative public-private partnerships, as well as new power purchase 

agreements with private generators, must be pursued. For years, advocates of power 

authority's centralized model have frowned upon these options. Their time is up. 

As other utilities have been doing for years, PREP A could even become a player 

in the renewable market. Sadly, that ship sailed years ago: the oil-addicted PREP A 

did nothing to embrace the renewable market through its little known, and now 

inactive subsidiary, PREP A Renewables. 

Policymakers are finally agreeing with the idea of a new energy model based 

on several regional microgrids in Puerto Rico. Microgrids for key government, 

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security and health installations (such as hospitals), would also help recovery efforts 

after future storms and hurricanes. 

The mandate to regulate microgrids is already in our law books: Act No. 133-

2016, the last bill sponsored by me that became law. The Puerto Rico Energy 

Commission recently announced an expedited process to enact proper regulations for 

microgrids. 

Microgrids present a unique opportunity for industries and residential 

communities. Although used for decades, Hurricane Sandy in 2012 opened a new 

dialogue on microgrids in the United States. Several business models for microgrids 

are actively discussed by energy stakeholders. Prominent researchers at the 

University of Puerto Rico·Mayagiiez College of Engineering, such as Efrain O'Neill, 

Ph.D., contribute regularly to the discussion with research on the possibilities of 

microgrids. 

Significant federal resources are required to build a new energy grid 

A stronger, resilient and "smarter" grid is required to properly decentralize 

Puerto Rico's energy model. The old (and now collapsed) grid, was only able to 

integrate of 580 MW of renewable power. The grid that is currently being repaired 

lacks "smart grid" technology; hence, the old grid is not able to deal with the technical 

challenges of an energy model which embraces renewable power, and includes active 

energy consumers. 

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Appropriating taxpayer money just to repair an old 20th Century grid is a waste 

of resources. Ken Buell, director of Emergency Response and Recovery with the U.S. 

Department of Energy, stated that "we really should think in terms of rebuilding at 

this point", not just repairing the old grid. Judith Enck, former 

EPA administrator, concluded that "it's absolutely imperative that FEMA not 

fund rebuilding an inadequate system". 

There are no official cost estimates for the project proposed herein. Building 

the infrastructure for a decentralized energy model is obviously a multibillion dollar 

project. But with the insolvency of PREP A and the government of Puerto Rico, the 

federal government is the only entity able to finance this key project. 

PREP A's governance ... and the Whitefish debacle 

The Whitefish scandal currently occupies media space that could rather be 

used to portray the current humanitarian crisis in Puerto Rico. But, as stated earlier, 

Whitefish is a sad example of the shameful and incompetent governance that 

characterizes PREP A. 

The energy industry watched with dismay as PREP A declined to activate the 

mutual aid protocols of the American Public Power Association and the Edison 

Electric Institute. Instead, PREP A opted to award a no·bid $300 million contract to 

a company with just two employees, totally unknown in the industry, and even 

unknown by an energy regulator from Montana, their home state. 

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The Whitefish contract included provisions that would have raised the 

attention of a first·year law student. It precluded audits from government authorities 

over the work performed, and absurd and illegal clause. The contract represents that 

FEMA approved it, which is false. FEMA knew about the contract after the fact, and 

has "significant concerns" about the process of procurement and the contract prices. 

The government recently requested PREP A to cancel the controversial 

agreement, and attempted to take distance from it. Now, forty days after Hurricane 

Maria, PREP A did what it should have done from the start: request the mutual aid 

offered by the private and public electric companies of APPA and EEL Finally, help 

is on the way, after wasting forty days. 

But where was PREP A's governing board? PREP A has stated that it failed to 

make contact with their board for fourteen days after Maria. Obviously, they had to 

pass judgment on the Whitefish contract, which they did. 

The fact that nobody in that board appears to have seriously questioned the 

Whitefish agreement, raises two possibilities: either they rubber·starnped the 

management's decision, without reading, or somebody lobbied PREP A really hard to 

favor Whitefish. I hope that we will know the real Whitefish story, soon enough. 

I submit that Whitefish is the direct result of the current government's recent 

legislation to control PREPA's board. For the first time in PREPA's history, a 

professional, nowpartisan and independent board was appointed in 2016, as 

mandated by Act No. 4·2016. But it was short·lived. Now, government officials and 

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other members selected by the governor control the board. This politically controlled 

board delivered Whitefish. 

Federally-sanctioned solution to PREPA~9 unpayable debt 

In 2014, PREPA collapsed under its $9 billion debt. Bankruptcy was not an 

option because Congress, in a yet unexplained 1984 decision, 'mysteriously' excluded 

PREP A from the bankruptcy provisions of Chapter 9. The local legislature tried to 

provide a "bankruptcy type" solution for PREP A, but the so·called Recovery Act was 

struck down by the United States Supreme Court in 2016. 

Pursuant to the PRO MESA Act, Congress imposed a Financial Oversight and 

Management Board over the Commonwealth to deal with the Island's fiscal 

nightmare. On behalf of PREP A, the Board filed for the bankruptcy-type process 

under Title III ofPROMESA. 

I respectfully submit that building a new energy grid for Puerto Rico, as has 

been proposed, will not be possible until PREP A's debt situation is solved. PREP A's 

$9 billion debt was already unpayable before Hurricane Maria. Now, with its grid 

collapsed, the people leaving by the thousands, and businesses closing, there is no 

way for PREP A and its customers, the people of Puerto Rico, to pay the debt. Failure 

to pay PREP A's debt is not a moral issue: it is a financial impossibility. 

Bondholders would have reason to object a project to decentralize Puerto Rico's 

energy model. They bought bonds based on the business model of a centralized energy 

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utility. The prospect of a utility that agrees to lose earnings, as a result of its 

decentralization, runs counter to their financial interests. 

Congress, the Administration, the Oversight Board, and even the federal court 

must consider enabling a process to create a financial solution for PREP A's debt. If 

there is political will, a creative financial solution will certainly emerge. Aggressive 

restructuring of the debt, combined with new, Brady-type bonds, and continued 

oversight over PREP A, could be the way to build a new energy model and 

infrastructure in Puerto Rico. 

PR Energy Commission: an Independent and Stmng Regulator 

The most efficient way to transform the energy model of Puerto Rico is by 

getting politics out of PREP A. Decisions about energy policy and management must 

be based on facts, data, and compliance with applicable laws and regulations. 

Hence, a strong an independent energy regulator is the only way to guarantee 

that politics no longer control decisions over the energy sector. 

Act No. 57-2014, the "Act for the Transformation and Energy Relief of Puerto 

Rico", paved the way to end PREP A's inefficient monopoly. The Energy Reform Act 

contains a strong and forward-looking declaration of public policy, as well as specific 

mandates to transform PREP A, and develop the framework for a vibrant private 

energy sector. The creation of a powerful and independent Energy Commission ended 

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seven decades of self-regulation. The Energy Commission has broad powers of 

regulation and dispute resolution over PREP A and the private energy sector. 

For the first time in its existence, PREP A was required to prepare an 

Integrated Resources Plan (IRP). The IRP creates a roadmap of the electric power 

system in Puerto Rico during a twenty (20)-year period. The Energy Commission now 

has the authority to approve PREP A's rates, and concluded its first ever rate review 

in early 2017. For political reasons, PREPA's basic rate had not been revised since 

1989. 

A new legal framework for energy regulation and management was established 

by Act 57. Apart from the powerful Energy Commission, the Act created the 

Independent Consumer Protection Office, an energy advocate for consumers. New 

powers of oversight and authority to implement energy policy were also delegated to 

the State Energy Public Policy Office. 

Congress, the Administration and the Oversight Board have expressed their 

support for the Energy Commission created under Act No. 57-2014. 

Title V of PROMESA provides for the appointment of a Revitalization 

Coordinator who will assess "critical projects" to (i) improve performance of energy 

infrastructure and overall energy efficiency; (ii) expedite the diversification and 

conversion of fuel sources for electric generation from oil to natural gas and 

renewables; (iii) promote the development and utilization of energy sources found on 

Puerto Rico; (iv) contribute to transitioning to privatized generation capacities in 

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Puerto Rico and (v) support the Energy Commission in achieving its goal of reducing 

energy costs and ensuring affordable energy rates. 

The Oversight Board has named Mr. Noel Zamot as both Revitalization 

Coordinator, and chief restructuring officer of PREP A (a decision challenged by the 

government of Puerto Rico). 

In order to guarantee that federal funds to build a new energy grid arc properly 

used and allocated, I propose that the Revitalization Coordinator and the PR Energy 

Commission be given sole authority over PREP A. PROMESA already mandates that 

the Revitalization Coordinator will work with the PR Energy Commission, so this 

proposal is a logical step. Neither Puerto Rico, nor the U.S. government, need another 

Whitefish situation. 

Thank you for this opportunity. The people of Puerto Rico urgently need to turn 

the lights back on. But we also demand the resources to create a new energy model. 

Our lives depend on it. 

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170 

Mr. OLSON. Thank you, Senator Luis Nieves. 

We saved the best for last, ma’am. Our final opening statement 

is going to be from Ms. Cathy Kennedy, and she is the Vice President of the National Nurses United. 

Ma’am, you have 5 minutes for an opening statement. Welcome. 

STATEMENT OF CATHERINE B. KENNEDY 

Ms. CATHERINE KENNEDY. Vice Chairman Olson, Ranking Member Rush, and members of the subcommittee, good afternoon, and 

thank you for inviting National Nurses to take part in this hearing. 

My name is Catherine Kennedy of Carmichael, California, and I 

have been a registered nurse for 37 years. I currently serve as the 

Vice President of National Nurses United, which is the largest 

union of RNs in the country. I submit the testimony today on 

NNU’s behalf. 

From October the 4th through the 18th, I served on a voluntary 

deployment to Puerto Rico with NNU’s Registered Nurse Response 

Network to assist with Hurricane Maria’s disaster relief. Fifty 

nurses deployed with R&R into Puerto Rico among 300 skilled 

union members organized by AFL–CIO. 

NNU nurses very much appreciate your holding this hearing and 

providing us the opportunity to share our account of the public 

health crisis that we witnessed. NNU’s full report on the conditions 

of Puerto Rico is attached to my written testimony. 

The lack of electricity is endangering people’s lives and leading 

to preventable death and illness. I was the lead RN for the 

healthcare teams on the deployment. I helped to organize nurses 

into teams and, with a map of the island, we tracked the public 

health assessment of each community that we visited, evaluating 

whether people had access to food, water, and healthcare, their 

basic living conditions, and medical needs. Time and time again, 

we saw that lack of power exacerbated the disaster or created new 

ones. 

Basic medical services were down in many areas and not fully 

functioning in others. An acute public health crisis has developed. 

Without electricity, people with chronic illnesses, such as diabetes 

and hypertension, cannot refrigerate their medications. For example, in Loiza, nurses worked with elderly residents who had to put 

their insulin in bowls of tepid water, trying to keep this lifesaving 

medication cool enough to use. 

Pharmacies could not refrigerate their medications, either. They 

also cannot access computer systems which store prescription orders. Therefore, patients were scrambling to find doctors to write 

new prescriptions, so they can give them to the pharmacies. But 

many doctors’ offices were closed, partly because the grid is still 

down and accessing reliable generators and fuel for them was nearly impossible. 

Pharmacies also cannot access insurance information. So, patients are being asked to pay full price for medications. Most people 

don’t have cash, and if they had money in the bank, they can’t access it because the ATMs and the banking process systems are also 

down. 

As long as the power grid is down, hospitals cannot function at 

full capacity. Generators are prone to failure, and fuel is hard to 

171 

access. With generators, hospitals can’t perform certain procedures 

or tests which use a large amount of energy. And at one hospital 

we know that they could not perform MRIs as long as they relied 

only on generators. 

Without reliable power, the problems of accessing food and water 

are amplified. The simple act of purchasing food and water, when 

it is available, is nearly impossible. Stores can’t take credit cards, 

and ATMs don’t work. Bank services that normally take minutes 

now take hours. 

The people of Puerto Rico are unable to refrigerate and cook 

their food. They must rely on canned and processed foods, which 

are high in sodium. Access to food in rural communities is especially difficult. As long as there is no power, people will be reliant 

on relief organizations to provide food and water for them. 

Electricity is also needed to run wastewater treatment plants 

and to restore the functioning of water utilities. Without clean running water, nurses have witnessed the beginnings of multiple outbreaks of waterborne diseases, including leptospirosis, an animalborne bacterial disease that can be fatal if not treated in time. 

Then, there are problems accessing FEMA aid. People can’t access FEMA’s online notices and aid application. For those that are 

able to apply for aid, they are told that necessary followup communication will be sent either by text or email. People don’t have 

power right now. They are not going to receive any followup for 

their FEMA applications. 

NNU urges Congress to use its oversight and appropriation authority to ensure that FEMA and other U.S. agencies respond to 

this crisis effectively. It is unacceptable that citizens of the richest 

country on earth have been denied necessary humanitarian aid and 

left to die. With a growing climate crisis, relief to Puerto Rico must 

come in the form of responsible measures that can build a sustainable energy future. 

Thank you again for giving NNU the time to share the stories 

of the people and places in Puerto Rico that we cannot and must 

not forget. Thank you. 

[The prepared statement of Ms. Kennedy follows:] 

172 


Testimony of Catherine B. Kennedy, RN 

On Behalf of National Nurses United Before the 

House Energy and Commerce Committee 

Subcommittee on Energy 

November 2, 2017 

SUMMARY 

• National Nurses United (NNU), with the Registered Nurse Response Network (RNRN), sent 

50 registered nurses (RNs) to Puerto Rico to assist with Hurricane Maria disaster relief from 

October 4 to October 18, coordinating with a 300-union member relief delegation of the 

AFL-ClO. 

• RN volunteers observed that, without access to power, basic medical services were down in 

many areas of Puerto Rico and not fully functioning in most others. An acute public health 

crisis has developed, including lack of refrigeration for medicine, exacerbation of respiratory 

illnesses, limited to no access to money or insurance for prescriptions, spread of dangerous 

waterborne bacterial disease, and failing generators in hospitals. 

• Without power, people have had trouble accessing food and clean running water even if 

supplies are available because water treatment plants are not fully functioning and many 

electronic banking systems are inoperable. 

• Lack of power created barriers for Puerto Ricans seeking FEMA aid and aid applications 

because aid applications and FEMA announcements rely on text, email, and web-based 

communications. 

• RNs witnessed first-hand the dire conditions for Puerto Rican residents and the insufficient 

response from federal relief agencies in this disaster. 

• NNU urges Congress to take the following actions immediately to prevent further erosion of 

public health conditions in Puerto Rico and to put the island back on a path to recovery. 
173 


Testimony of Catherine B. Kennedy, RN 

On Behalf of National Nurses United Before the 

House Energy and Commerce Committee 

Subcommittee on Energy 

November 2, 2017 

Chairman Upton, Ranking Member Rush, and other Members of the Subcommittee, good 

morning and thank you for inviting National Nurses United (NNU) to provide testimony on 

Hurricane Maria disaster relief in Puerto Rico. My name is Catherine Kennedy, of Roseville, 

CA. I have been a registered nurse (RN) for 37 years, and I am one of the Vice Presidents of 

NNU, the largest union representing RNs in the United States. NNU currently has over 150,000 

members who work as bedside healthcare professionals in every state in the nation. I submit this 

testimony on Hurricane Maria disaster response efforts today on NNU's behalf. 

On October 18, I returned from a two-week volunteer deployment with NNU's 

Registered Nurse Response Network (or as we call it RNRN) to Puerto Rico to assist with 

Hurricane Maria disaster relief. RNRN is a national network of direct-care RNs that coordinates 

sending volunteer RNs to disaster stricken areas where and when they are needed most. RNRN is 

a project of the California Nurses Foundation, which is a 501(c)(3) non-profit organization, 

affiliated with National Nurses United. RNRN first deployed nurses after the South East Asian 

Tsunami in 2004, and again in 2005 when Katrina and Rita two of the most destructive 

hurricanes in history- dramatically exposed America's flawed disaster relief system. RNRN 

has since responded to other disasters, including the earthquake in Haiti in 20 I 0, super storm 

Kennedy Testimony 

Energy and Commerce Committee, Subcommittee on Energy 

The 20 17 Hurricane Season: A Review of Emergency Response and Energy Infrastructure Recovery 

November 2, 20 17 

Page 2 of26 
174 


Sandy in 2012 and Typhoon Haiyan in 2013, in addition to other humanitarian missions and 

ongoing first aid support. 

Shortly after Hurricane Maria made landfall in Puerto Rico on September 20, 2017, a 

large delegation of 50 volunteer nurses deployed with RNRN to Puerto Rico as part of a 300-

person delegation of skilled union members organized by the AFL-CIO. The deployment took 

place from October 4 to October 18- I returned to the mainland exactly two weeks ago. 

NNU nurses, especially those of us who were on the ground in Puerto Rico, very much 

appreciate your holding this hearing and providing us the opportunity to share with you the 

perilous public health crisis that we have witnessed. I would like to tell you about the realities we 

witnessed and outline for you the many ways in which the lack of electricity and energy is 

endangering people's lives and leading to preventable death and illness. 

NNU's full report on the conditions in Puerto Rico that RNRN volunteers observed are 

attached to this testimony. 

The RNRN and AFL-CIO Disaster Relief Deployment to Puerto Rico and FEMA Response 

After arriving in Puerto Rico, I helped to organize nurses into teams to provide skilled 

nursing care and assess the public health of communities they visited. We evaluated many 

different factors including access to food, water, and healthcare, basic living conditions, and 

medical needs. In many of the communities we visited outside of San Juan, we were the first 

relief workers that communities had seen. As a result, our nurses were at times the first people to 

clear roads in order to reach rural communities, or to purchase and deliver food for people who 

had not yet been assisted by FEMA or other agencies. 

Kennedy Testimony 

Energy and Commerce Committee, Subcommittee on Energy 

The 2017 Hurricane Season: A Review of Emergency Response and Energy Infrastructure Recovery 

November 2, 2017 

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I took the role as the lead RN for the AFL-CIO deployment's healthcare teams. I was 

responsible for overseeing which municipalities the teams were visiting. With a map of the 

island, we tracked the health assessment of each community we visited. What we saw time and 

time again was that the lack of electricity and the lack of energy sources exacerbated the disaster 

or created new ones. 

The reality of this situation hit home for me, when in the first days of our deployment, I 

visited homes in Cupey, a neighborhood in San Juan, with an industrial hygienist. We were 

assessing the living conditions, especially as they related to safe drinking water. Normally, the 

first thing you would advise someone to do when water is unsafe to drink is to boil their water. I 

asked the residents we were visiting if they had electricity or gas to boil their water all of them 

said no. 

The Public Health Impact Resulting From Lack of Power 

Without access to power, basic medical services are down in many areas and not fully 

functioning in most others. An acute public health crisis has developed. 

Without electricity, people with chronic illnesses cannot refrigerate their medications. For 

example, a group of our nurses travelled to Loiza and worked with elderly residents who 

depended on insulin. The residents had put their insulin in bowls of tepid water, to try to keep 

this life-saving medicine cool enough to use. The fact is that without refrigeration, people with 

diabetes, hypertension, and other illnesses are at risk of severe illness and death. 

Patients who require the use of breathing treatments for respiratory illnesses were unable 

to use their medications because many of the drug delivery devices need electricity. People with 

asthma who rely on Nebulizers have been unable to perform necessary breathing treatments. 

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Energy and Commerce Committee, Subcommittee on Energy 

The 2017 Hurricane Season: A Review of Emergency Response and Energy Infrastructure Recovery 

November 2, 20 17 

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Without power, pharmacies cannot refrigerate their medications nor can they access their 

computer systems which store prescription orders for refills. Patients have been left scrambling 

to find doctors to write new prescriptions for their medications, so that the pharmacy can process 

it. Yet, many doctor's offices are closed. As of October 18 when I left, there were clinics and 

pharmacies in rural areas that remained closed, partly because the grid was still down and 

accessing reliable generators and fuel is nearly impossible. 

Without their computer and online systems, pharmacies cannot access insurance 

information for patients. As a result, many are asking patients to pay the full cost of medication. 

Most people do not have the cash to pay for prescriptions, and even if they have money in the 

bank, they cannot access that cash because many A TMs and the electronic banking system are 

also down. The A TMs that are working have long lines, with people waiting hours to withdraw 

money, if they have access to a vehicle and gas in order to make the trip to one that is working. 

When we first arrived, two weeks after the hurricane hit, hospitals were still not able to 

run at full capacity, and had to operate under dangerous circumstances. My understanding is that 

most hospitals are now up and running with generators, but they cannot depend on generators in 

the long term. Generators are perpetually failing and fuel is hard to access. Running on gas, 

generators throughout the community create their own health problems, exacerbating respirator 

distress caused by black mold and posing carbon monoxide risks. 

Perhaps most important in the short term, is that when a hospital relies solely on a 

generator, there are certain procedures that cannot be performed because of the amount of energy 

they usc. We experienced this first hand during our deployment when two of the nurse volunteers 

needed to be hospitalized. I was able to observe the situation in multiple San Juan hospitals, as 

we tried to find the best care available for our volunteers. One of the nurses needed an MRI, and 

Kennedy Testimony 

Energy and Commerce Committee, Subcommittee on Energy 

The 2017 Hurricane Season: A Review of Emergency Response and Energy Infrastructure Recovery 

l'\ovember 2, 2017 

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the doctor informed us that they could not do the MRI because the hospital was relying only on a 

generator. 

As long as hospitals are relying solely on generators, patients will be denied the full care 

that they need. 

Finally, during the time 1 was there, as many of you may have heard through media 

reports, the USNS Comfort was just off the shore of Puerto Rico, but most of its 250 beds were 

unused weeks after the Hurricane hit, even though its services were badly needed. Without 

electricity, communication was constrained throughout the island, and so many clinicians were 

unaware that the Comfort was close by. Or, if they were aware, they did not know how to 

transfer their patients to the ship. Having served on the USNS Comfort previously, I know that 

its services would have greatly helped the people of Pue1to Rico in the first weeks after the 

disaster, if only we could have transferred patients to the ship. 

Lack o[Access to Food and Water 

We immediately saw that because of the power outage, people could not access food and 

water even if supplies were available. Without reliable power, the electronic banking system was 

initially inoperable and much of it is still not up and running. This makes the simple act of 

purchasing food and water - when there is some available - nearly impossible. Stores cannot 

take credit cards, and A TMs do not work. Bank services that under normal circumstances take 

minutes, now can take hours to complete in Puerto Rico. If someone did have cash when the 

hurricane first hit, that money quickly ran out. 

Without electricity or energy, Puerto Ricans are unable to refrigerate and cook their food. 

Without ready access to fresh food, they must rely on canned and processed foods, which are 

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Energy and Commerce Committee, Subcommittee on Energy 

The 2017 Hurricane Season: A Review of Emergency Response and Energy Infrastructure Recovery 

November 2, 2017 

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often high in sodium. This can be incredibly dangerous for the many people with chronic health 

concerns. As I think many of you know, most people have not had access to food, especially in 

rural communities. As long as there is no power in Puerto Rico, people will continue to be reliant 

on relief organizations to provide food and water. 

Electricity is also needed to run waste water treatment plants, and to restore the 

functioning of water utilities so that residents have clean running water. Since water treatment 

plants had not been restored during our time in Puerto Rico, nurses witnessed the beginnings of 

multiple outbreaks of water borne diseases including leptospirosis, an animal-borne bacterial 

disease that can be fatal if not properly treated in time. 

Puerto Rican resident are facing excruciating questions: do they suffer from severe 

dehydration or drink from contaminated rivers or streams that could lead to their death? Should 

they risk contracting and spreading a potentially lethal epidemic of leptospirosis, or risk using 

Superfund well water or untreated water coming from a spring? Everyday, our nurses on the 

deployment saw our fellow citizens in Puerto Rico desperate for safe drinking water and forced 

to make terrible choices. 

Problems Accessing FEMA Aid and Aid Applications 

In the report NNU released, there is first hand testimony from our nurses who witnessed 

the problems people faced in accessing FEMA aid applications. Without power, people weren't 

able to access FEMA's online notices about where and when FEMA would be available. When 

people knew that FEMA would be in their communities to collect applications for aid, it was 

through word of mouth. 

Kennedy Testimony 

Energy and Commerce Committee, Subcommittee on Energy 

The 2017 Hurricane Season: A Review of Emergency Response and Energy Infrastructure Recovery 

November 2, 20 17 

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Even if families figured out when FEMA would be in town, the lack of power raised 

more barriers. In one town, RNs met families that lined up for aid at I 0 p.m. the night before 

FEMA was there. In another, people were lining up as early as 3 a.m. Doors would open at 8 

a.m. and lines would be cut off by FEMA at 1 OAM. For those who made it through the line, they 

were told that necessary follow-up communications on their FEMA aid applications would be 

sent by an outsourccd company that only texts or emails. Families in desperate need for FEMA 

aid were now left to the whims of faulty electric utilities and the hopes that internet, email, or 

cell service would be restored in time. 

Federal Government Response Has Been Inexcusably Delayed and Unacceptably lnsufiicient. 

Based on the experiences of our nurses, the federal government's response to the critical 

health and safety needs of Puerto Ricans has been woefully insufficient. Given the complex 

challenges outlined above, it is necessary that the government step in swiftly to ensure that 

Puerto Ricans regain access to electricity and power immediately. 

The response to Hurricane Maria has also been inadequate in other areas. Most notably, 

our nurses were appalled by the lack of food and water assistance provided by FEMA, and the 

quality of that assistance where it existed. Those who received food from FEMA received junk 

food, like Pop-Tarts and Oreos. After waiting in line for hours for FEMA assistance, we watched 

as residents walked away with only a snack-sized pack of Cheez-its and a small bottle of water. 

Repeatedly, in town after town, residents told RNs that we were the first relief workers they had 

seen- even a full three weeks or more after Maria had made landfall. 

In one community, an RNRN volunteer reported that seemingly every single resident had 

conjunctivitis. In other communities, the presence of black mold, and residents sleeping on wet 

Kennedy Testimony 

Energy and Commerce Committee, Subcommittee on Energy 

The 2017 Hurricane Season: A Review of Emergency Response and Energy Infrastructure Recovery 

November 2, 20 17 

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couches, were posing significant health concerns. Our RNs found people who they worry may 

die before suflicient food, water, or medicine reaches them. In a desperate effort to help, our 

nurses conducted pub I ic health education. producing and distributing a flyer, and going on the 

radio to teach people how to clean black mold and disinfect their water. 

I'm so proud of our nurses. The map tracking RNRN's relief efforts shows all that we 

accomplished in two weeks. But it is painful to know that, for many Puerto Ricans, relief is 

certainly too little and may be too late to stave off a public health crisis. Every day in Puerto 

Rico, I asked myself- and I know the other RNs volunteering by my side asked themselves- if 

we could provide this aid, how has our government, with all its resources, been unable to do the 

same? 

It is unconscionable that the people of Puerto Rico are suffering and dying. This is a 

public health crisis that should never have reached this point. Congress must act now to get 

Puerto Rico the disaster relief it so desperately needs. 

It is the responsibility of the federal government to step in during humanitarian crises 

like the one in Puerto Rico - when state and local governments cannot take care of their 

residents alone. It is unacceptable for us to say that we cannot and should not rely on the federal 

government for support, and that people need to be more resilient in a disaster without the full 

aid of their federal government. This kind of rhetoric cannot hide the fact that the federal 

government is shirking its responsibility and abandoning American citizens to patronage of 

profit-driven corporations that are wholly unaccountable to the public. 

NNU urges Congress to use its oversight and appropriations authority to ensure that 

FEMA and other U.S. agencies respond to this crisis swiftly and effectively. It is unacceptable 

that citizens of the richest country of Earth have been denied necessary humanitarian aid and left 

Kennedy Testimony 

Energy and Commerce Committee, Subcommittee on Energy 

The 2017 Hurricane Season: A Review of Emergency Response and Energy Infrastructure Recovery 

November 2, 2017 

Page 9 of26 
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to die. Importantly, with the growing climate crisis, relief to Puerto Rico must come in the form 

of responsible measures that can build a sustainable energy future. 

Thank you again for giving NNU and the RN Response Network the time to share the 

stories of the people and places in Puerto Rico that we cannot and must not forget. 

RNRN Observations: Post-Hurricane Maria Disaster Conditions on the Ground in Puerto Rico. 

RNs witnessed first-hand the dire conditions Puerto Rican residents are facing and the 

insufficient response l!·om federal relief agencies in this disaster. Conditions I witnessed with 

other RNs in Puerto Rico include: 

• Many communities had still not received any federal assistance or relief from FEMA or 

other agencies by the end of this deployment on October 18, 2017. 

• Residents who had contact with FEMA stood in line for hours in the blistering heat, 

waiting for desperately needed water and food. Instead, many were asked to fill out 

paperwork "to coltect data" and apply for FEMA assistance. 

• They were given only a small bottle of water and a smaH pack of Cheez-It crackers. 

• Residents in communities where FEMA personnel were not present have been unable to 

apply for FEMA assistance online because of the lack of electricity and internet service. 

• Residents continuing to live in houses without roof and soaked interiors where there is 

dangerous black mold growing that creates respiratory distress and illness. 

• Residents desperate for water using containers that used to hold anti-freeze and other 

toxic agents to gather water from potentially contaminated streams. 

Kennedy Testimony 

Energy and Commerce Committee, Subcommittee on Energy 

The 2017 Hurricane Season: A Review of Emergency Response and Energy Infrastructure Recovery 

November 2, 20 17 

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• Major areas away from urban centers where residents still had received no provisions and 

had no running water and no electricity. 

• Nurses had to sometimes clear debris in roads themselves in order to gain access to 

communities who had not received any aid since the hurricanes had struck. 

• Dangerous debris and trash piled up outside homes that had not been cleared by 

authorities, creating many health hazards. Many residents were clearing debris 

themselves without proper protective hear, and, in some areas, residents are creating 

landfills without better options. 

• Many people who have lost weight since the hurricanes hit due to lack of food (skipping 

meals, or giving their food to their children instead of eating themselves). 

A lack of basic healthcare services - many local doctors' offices were closed and 

hospitals were often full and lacking supplies (including clean drinking water), and 

running on generators prone to failure. 

• An outbreak of leptospirosis, a dangerous bacterial disease that had already claimed lives. 

• Numerous communities without clean water that are at risk of an outbreak of water-borne 

illnesses. 

• Many of the same conditions they witnessed continue five weeks after hurricane hit 

Puerto Rico. 

Federal Relief Actions Must Be Taken Immediately to Address the Growing Public Health and 

Safety Crisis in Puerto Rico. 

Kennedy Testimony 

Energy and Commerce Committee, Subcommittee on Energy 

The 2017 Hurricane Season: A Review of Emergency Response and Energy Infrastructure Recovery 

November 2, 2017 

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NNU urges Congress to take the following actions immediately to prevent further erosion 

of pub! ic health conditions in Puerto Rico and to put the island back on a path to recovery: 

Using oversight authority, Congress must ensure the expeditious functioning and 

efficacy of FEMA and other U.S. relief efforts on the ground. To deal with the immediate 

crisis, FEMA and the U.S. armed forces should greatly expand the use of air drops into Puerto 

Rico of water, food, and medicine. Human and financial resources must be deployed to 

overcome the bottlenecks that are keeping help from reaching those most in need, which range 

from a lack of communication to blocked roads to a shortage of vehicles and drivers to make 

deliveries. 

The U.S. Department of Defense must supply greater technological and logistics 

support to Puerto Rico. This should include providing technical assistance with restoring 

electricity to the island, installing temporary telecommunications connections in remote areas, 

and continuing to deploy boots on the ground to help clear roads and deliver humanitarian aid. 

Congress must provide resources this fiscal year to address Puerto Rico's looming 

Medicaid crisis, which is more severe after Hurricane Maria. The Medicaid shortfall was a 

problem before Hurricane Maria, and is now even more severe given the public health dangers 

following the storm. In the long term, Congress must ensure that Puerto Rico receives the same 

federal Medicaid funding as U.S. states, which would save Puerto Rico hundreds of millions of 

dollars annually. Efforts to address Puerto Rico's humanitarian needs in the wake of Hurricane 

Maria are inadequate if not extended to solving the island's impending Medicaid crisis. Without 

immediate action from the U.S. Congress, the territory will not have sufficient funds to continue 

operating its Medicaid program in 2018, which would strip nearly half of its 3.5 million residents 

of health insurance at a time when they need it most. 

Kennedy Testimony 

Energy and Commerce Committee, Subcommittee on Energy 

The 2017 Hurricane Season: A Review of Emergency Response and Energy Infrastructure Recovery 

November 2, 20 17 

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Congress mnst ensure that patients who need care can access the services of the 

USNS Comfort. The Comfort has served as a critical site for emergency medical treatment in 

the aftermath of natural disasters. The USNS Comfort has critical staff, equipment and supplies 

that are not readily available to many people in Puerto Rico right now. At a time of increased 

health care crises, we must use all resources available to us to care for patients in need, and our 

hope is that more people who are not able to get the care that they need can be transferred to the 

USNS Comfort. 

Congress must act to obtain a waiver for FEMA cost-sharing reguirements for all 

categories of expenditures. Given Puerto Rico's financial situation, this waiver must be for 

I 00% of all cost-sharing. This will allow FEMA to immediately authorize full reconstruction aid, 

known as C-G public assistance, to Puerto Rico. C-G public assistance would provide Puerto 

Rico with critical infrastructure aid in the rebuilding of roads and bridges, water control 

facilities, and public buildings and utilities. After Hurricane Katrina in 2005, FEMA spent $13.4 

billion to rebuild parts of Louisiana, almost $10 billion ofwhich came from the C-G assistance 

program. While FEMA authorized C-G assistance for Texas only I 0 days after Hurricane Harvey 

made landfall, Puerto Rico continues to suffer without this critical aid five weeks after the 

disaster. 

FEMA must extend the 60-day deadline for filing claims for disaster relief. While 

much of the island remains without reliable electricity and internet service, it is nearly 

impossible for people to assess the prope1ty damage and submit claims in the normal timeframe. 

Considering estimates that Pue1to Rico's power grid may not be fully operational for as long as 

six months or longer, FEMA must extend the deadline to file a disaster claim until power and 

internet is fully restored to the island. 

Kennedy Testimony 

Energy and Commerce Committee, Subcommittee on Energy 

The 2017 Hurricane Season: A Review of Emergency Response and Energy Infrastructure Recovery 

November 2, 2017 

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Attachments 

I. Biographical information for Catherine B. Kennedy, RN 

2. National Nurses United, Report on Conditions in Puerto Rico and Call for Immediate 

Congressional Action- released October 26, 20 I 7. 

Kennedy Testimony 

Energy and Commerce Committee, Subcommittee on Energy 

The 2017 Hurricane Season: A Review of Emergency Response and Energy 1ntrastructure Recovery 

November 2, 2017 

Page 14 of26 
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Biographical Information for Catherine B. Kennedy, RN 

Catherine B. Kennedy graduated from Samuel Merritt/Saint Mary's College and has worked as 

a Registered Nurse for the past 37 years. She currently works as a staff nurse at Kaiser 

Permanente - Roseville (Women and Children's Center) in the Neonatal Intensive Care Unit. 

She is the Secretary for the California Nurses Association and one of the Vice Presidents for 

National Nurses United (NNU). 

In 2013, Cathy was appointed by the California Senate as a Commissioner to the California 

Healthcare Workforce Policy Commission (CHWPC) which is under the direction of the Office 

of Statewide Health Planning and Development (OSHPD). 

In 2015, Cathy volunteered as a nurse representing RNRN (Registered Nurses Response 

Network) which is part of the California Nurses Foundation (CNF) nonprofit 501 3c 

organization. During this deployment, she worked with young military healthcare professionals 

and corpsmen/women on the USNS Comfort for 30 days and treated over I 0,000 Jamaican and 

Nicaraguan people during this time. Cathy believes that healthcare is a human right. 
187 


Report on Conditions in Puerto Rico and 

Call for Immediate Congressional Action 

A large delegation of 50 volunteer registered nurses from across the U.S. returned on 

October 18, 2017 from Puerto Rico after a two-week disaster relief effort in the wake of 

Hurricane Maria. The returning nurses are part of the Registered Nurse Response Network 

(RNRN), a disaster relief program sponsored by National Nurses United, and are among 300 

union members the AFL-CIO organized for the relief mission to Puerto Rico. 

While working in Puerto Rico, these RNs witnessed communities and neighborhoods that 

remained devastated four weeks after hurricane Maria made landfall. They provided care and 

other support for residents living in severely damaged homes who had not received help from 

FEMA or any other relief agency. These RNs described an ineffective federal response that 

has led to deadly conditions including extreme lack of food, water and medicine; people 

living in houses infested with black mold; and water-borne illnesses such as leptospirosis. 

The RN volunteers witnessed the perilous conditions residents are enduring. From the 

outskirts of San Juan to isolated mountain towns, they encountered many residents who had 

yet to be assisted by the U.S. government's relief effort. Many were staying in houses that 

had been destroyed by the hurricane - they were flooded, roofless, and most do not have 

electricity, sufficient food, and clean drinking water. Many residents told the nurses that they 

were the first people offering them assistance. In addition to providing medical care, the RNs 

created public health pamphlets to distribute and instructed residents on how to 

decontaminate their water and remove black mold from their homes. They also visited 

community radio stations where they provided health tips and water decontamination 

instructions on the air. 

Nurse testimonies include:' 

"These communities are at great risk of water borne illness epidemics. They need clean 

water that is safe to drink. It is outrageous that we are leaving our fellow Americans with 

essentially no aid. Many more will die if we don't step up." ---Erin Carrera, RN 

"Today our team traveled into the center of the island into the mountain town of Utuado. 

These towns are so isolated that relief efforts have not made it into these areas. It was due to 

impassable roads. But the local community cleared most of the roads. People said we were 

the first relief group to come into the area .. 7/Jey 're struggling to get basics such as food, 

water and medicine. "-···Roxanna Garcia, RN 

"We couldn't believe this is part of the United States. We did home visits in a low-income 

community with the public health liaisons who identify those in need and help them do basic 

blood pressure checks, blood sugar checks, refill their meds, etc. They have already had 

chronic diseases going on and now their environment is full of hazardous materials and 

sanitation is so poor. "~ Hau Yau, RN 
188 


Among conditions our RNs witnessed: 

Many communities had still not received any federal assistance or relief from FEMA or 

other agencies by the end of this deployment on October 18,2017. 

Residents who had contact with FEMA stood in line for hours in the blistering heat, 

waiting for desperately needed water and food. Instead, many were asked to fill out 

paperwork "to collect data" and apply for FEMA assistance. They were given only a 

small bottle of water and small pack of Cheez-It crackers. 

Residents in communities where FEMA personnel were not present have been unable to 

apply for FEMA assistance online because of the lack of electricity and internet service. 

Residents continuing to live in houses with roofs blown off and soaked interiors where 

there is dangerous black mold growing that creates respiratory distress and illness. 

Residents desperate for water using containers that used to hold anti-freeze and other 

toxic agents to gather water from potentially contaminated streams. 

Major areas away from urhan centers where residents still had received no provisions, 

had no running water and no electricity. 

Nurses had to sometimes clear debris in roads themselves in order to gain access to 

communities who had not received any aid since the hurricanes struck. 

Many people who have lost weight since the hurricanes hit due to lack of food (skipping 

meals, or giving their food to their children instead of eating themselves). 

A lack of basic healthcare services- many local doctor's offices were closed and 

hospitals were often full and lacking supplies (including clean drinking water), and 

running on generators that sometimes fail. 

An outbreak of leptospirosis, a dangerous bacterial disease that had already claimed lives. 

Numerous communities without clean water that are at risk of the outbreak of waterborne illness epidemics. 

The nurses' first-hand accounts are supported by official government sources, including the 

Federal Emergency Management Agency (FEMA), the government of Puerto Rico, and the 

Centers for Disease Control and Prevention (CDC); advocacy and professional organizations; 

and news reports. Many of the same conditions they witnessed continue five weeks after 

llurricane Maria made landfall. 

Approximately one million people lack access to running water. According to 

status.pr, 74% of Puerto Rico Aqueduct and Sewer Authority (PRASA) customers have 

water service.,; However, contrary to a statement on the FEMA website,,;; this water may 

not be potable. Those with running water have been advised by the Puerto Rican water 

authority to boil it for five minutes or treat it with chlorine. iv Those without access to 

running water are drinking and bathing in water from contaminated rivers and wells. 

With just over half of wastewater treatments operating, v AP reports that raw sewage is 

pouring into Puerto Rico's rivers and reservoirs. VI Some have resorted to drinking from 

wells on supcrfund sites that have been contaminated by hazardous chemicals. Vll 

There is a daily shortfall of 1.8 million meals. According to the Guardian, FEMA 

officials report that, together with its partners, they are providing only 200,000 meals a 

day when more than 2 million people are in need. "'We are 1.8 million meals short,' said 

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Energy and Commerce Committee, Subcommittee on Energy 

The 2017 Hurricane Season: A Review of Emergency Response and Energy Infrastructure Recovery 

November 2, 2017 

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one senior Fema [sic] official.' ... And it's not going away. We're doing this much today, 

but it has to be sustained over several months."'"" In addition, with 1.3 million of Puerto 

Rico's poorest residents receiving food stamps, only 39% of businesses arc able to 

process the electronic payments that make up 75% of the monthly benefit." 

More than three-quarters of Puerto Rico Electric Power Authority (PREP A) 

customers are without electrical service, x Although Governor Rosello has pledged to 

have 95% of the power restored by December, his public affairs secretary, Ramon 

Rosario Cortes stated: "We have 230 brigades. If we used only these brigades, we'd be 

talking long months- years.''" 

37% of telecommunications has yet to be restored.';; This figure includes wired and 

wireless service. Nearly half of cell towers and two-thirds of the cell antennas are down. 

Most roads remain impassable. According to FEMA: "392 miles of Puerto Rico's 5,073 

miles of roads are open, allowing for passage through the outer ring of the island."x;;; 

60,000 homes need roofing help but only 38,000 tarps have been delivered.xov One 

type of roof repair being provided is designed to last only 30 days making roofing repair 

and exposure to the elements an ongoing problem.xv Those that went up first may already 

need to be replaced. 

The health care infrastructure has been devastated. Although 65 of 67 hospitals are 

operational, only 49 have electricity. xv• In addition, most of the hospitals arc only 

partially functioning and arc using generators; only twenty are actually connected to the 

electricity grid."'" Those running by generator arc vulnerable to lapses in fuel delivery. 

Although most dialysis centers are open, some have shortened hours and reduced dialysis 

treatments from four to three hours. xv;n Yet, despite great need, the Navy ship USNS 

Comfort remains largely idle. The Wall Street Journal reports: ·'The USNS Comfort, a 

70,000-metric-ton ship staffed with roughly 800 medical and support personnel and 250 

beds, has treated only about 150 people since it arrived on Oct. 3, said a U.S. Navy 

spokesman aboard the vessel.''"' CNN reports: ''Only 33 of the 250 beds on the Comfort 

- 13%- are being used, nearly two weeks after the ship arrived."xx 

Disease outbreaks and serious health problems loom. According to the Infectious 

Diseases Society of America, Puerto Ricans arc at serious risk of waterborne, mosquitoborne, food-borne, and mold-related illnesses."' The CDC has advised healthcare 

providers "to be vigilant in looking for certain infectious diseases, including 

leptospirosis, dengue, hepatitis A, typhoid fever, vibriosis, and influenza."xx'; According 

to Puerto Rico state epidemiologist Carmen Deseda, 74 cases of leptospirosis had been 

reported as of October 19'h, which is more than the 60 cases Puerto Rico typically 

experiences in a year."';' In addition to the increased risk, the healthcare system is 

severely compromised. The Huffington Post reports: "When asked if the health system on 

the island currently had the infrastructure to deal with a possible outbreak of any disease, 

[Governor] Rosello admitted that the hospital system is 'very frail' ... ''xx" 

Kennedy Testimony 

Energy and Commerce Committee, Subcommittee on Energy 

The 2017 Hurricane Season: A Review of Emergency Response and Energy Infrastructure Recovery 

November 2, 2017 

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Nurses demand the following actions be immediately taken to address the crisis: 

Congress must exercise its oversight authority to ensure the expeditious functioning and 

efficacy of FEMA and other U.S. relief efforts on the ground. To deal with the immediate 

crisis, FEMA and the U.S. armed forces should greatly expand the use of air drops into 

Puerto Rico of water, food, and medicine. Human and financial resources must be 

deployed to overcome the bottlenecks that are keeping help from reaching those most in 

need, which range from a lack of communication to blocked roads to a shortage of 

vehicles and drivers to make deliveries. 

The Department of Defense must supply greater technological and logistics support to 

Puerto Rico. This should include providing technical assistance with restoring electricity 

to the island, installing temporary telecommunications connections in remote areas, and 

continuing to deploy boots on the ground to help clear roads and deliver humanitarian 

aid. 

Congress needs to immediately provide resources this fiscal year to address Puerto Rico's 

looming Medicaid crisis. The Medicaid shortfall was a problem before Hurricane Maria, 

and is now even more severe given the public health dangers following the storm. In the 

long term, Congress must ensure that Puerto Rico receives the same federal Medicaid 

funding as U.S. states, which would save Puerto Rico hundreds of millions of dollars 

annually. Efforts to address Puerto Rico's humanitarian needs in the wake of Hurricane 

Maria are inadequate if not extended to solving the island's impending Medicaid crisis. 

Without immediate action from the US Congress, the territory will not have sufficient 

funds to continue operating its Medicaid program in 201 8, which would strip nearly half 

of its 3.5 million residents of health insurance at a time when they need it most. 

The federal government must immediately ensure that patients who need care can access 

the services of the USNS Comfort. The Comfort has served as a critical site for 

emergency medical treatment in the aftermath of natural disasters, and RNRN/NNU 

volunteers have served on missions including disaster relief in Haiti after the 201 0 

earthquake as well as the humanitarian assistance mission Continuing Promise in2010 

and 2015. The USNS Comfort has critical staff, equipment and supplies that are not 

readily available to many people in Puerto Rico right now. At a time of increased health 

care crises, we must use all resources available to us to care for patients in need, and our 

hope is that more people who are not able to get the care that they need can be transferred 

to the USNS Comfort. 

The administration must respond immediately to the governor's request to waive FEMA 

cost-sharing requirements for all categories of expenditures. Given Puerto Rico's 

financial situation, this waiver must be for 100% of all cost-sharing. This will allow 

FEMA to immediately authorize full reconstruction aid, known as C-G public assistance, 

to Puerto Rico. C-G public assistance would provide Puerto Rico with critical 

infrastructure aid in the rebuilding of roads and bridges, water control facilities, and 

Kennedy Testimony 

Energy and Commerce Committee, Subcommittee on Energy 

The 2017 Hurricane Season: A Review of Emergency Response and Energy Infrastructure Recovery 

November 2, 20 17 

Page 20 of26 
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public buildings and utilities. After Hurricane Katrina in 2005, FEMA spent $13.4 billion 

to rebuild parts of Louisiana, almost $10 billion of which came from the C-G assistance 

program. While FEMA authorized C-G assistance for Texas only 10 days after Hurricane 

Harvey made landfall, Puerto Rico continues to suffer without this critical aid five weeks 

after the disaster. 

FEMA must extend the 60-day deadline for filing claims for disaster relief. While much 

of the island remains without reliable electricity and internet connections, it is nearly 

impossible for people to assess the property damage and submit claims in the normal 

timeframe. Considering estimates that Puerto Rico's power grid may not be fully 

operational for as long as six months, FEMA must extend the deadline to file a disaster 

claim by at least an additional 120 days, or until power and internet is fully restored to the 

island. 

The response to the crisis in Puerto Rico from the U.S. federal government has been 

unacceptable for the wealthiest country in the world. 

During this humanitarian crisis, nurses urge the Trump Administration and Congress to 

take immediate action for the people of Puerto Rico by enacting the series of urgent 

measures outlined above. The US federal government must do everything in its power to 

assist the Puerto Rican people to recover from Hurricane Maria. 

Kennedy Testimony 

Energy and Commerce Committee, Subcommittee on Energy 

The 2017 Hurricane Season: A Review of Emergency Response and Energy Infrastructure Recovery 

November 2, 20 17 

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Appendix 

------------------

Following are some of the first hand reports from registered nurses on the ground: 

• "We met a man who lives in a two-story house with his elderly mom. He was sitting in a 

wheelchair on the second floor where there used to be a roof. II is right ankle was 

wrapped with toilet paper roll with a dirty gauze underneath. When unwrapped, a portion 

of internal fixation metal hardware used to stabilize his right ankle is exposed. There is 

also a quarter-sized ulcer with yellow drainage on his dorsal foot. He told us he has had 

multiple orthopedic surgeries for his right foot due to a former injury. Because of the 

hurricane, he loses follow up with his doctor and now he is stuck because his cell phone 

stops working and he has no transportation to go to a doctor's visit. We told him that his 

foot looked infected and he needed to go to an emergency room. He replied that he 

worried no one will take care of his foot because he has no money, and he would just sit 

and wait in the ER for hours without being attended. He asked us to talk to a local doctor, 

any doctor who can ensure his admission in the hospital. We brought his information 

back to the command center but the answer was disappointing-that we have no 

legitimate status to make referrals in Puerto Rico, and that a local doctor would need to 

sec him first-but there is no timeline on when and how it's going to happen. We left this 

guy with questions unanswered, along with the risk of sepsis and death from an infected 

foot hardware."-llau Yau, RN 

• "Spent the day in Rio Grande, a hard hit area outside of San Juan. No power or water 

here since Maria. We set up a clinic at a FEMA site (their first time here). People lined up 

for blocks since l 0 pm last night. But FEMA was only handing out papers! Papers, which 

need to be filled out in order that they might receive some reimbursement eventually. 

Each person received a small bottle of water, a mini bag ofCheeze-lts and a little pack of 

vanilla cookies. Outrageous. Meanwhile grocery stores have limited supplies and lines 

for many blocks. What amazes me is how kind, calm and sharing the Puerto Ricans arc, 

sharing with and helping their friends, family and neighbors. We were able to provide 

care to some, not nearly enough, but one small contribution to this tragedy today."- Erin 

Carrera, RN 

• "Today we went to Corozal after meeting in the disaster command center this a.m. We set 

up a clinic at a school where families are living, and then the mayor drove us up a hill to 

do door-to-door assessments. Families were extremely relieved to sec us. We are seeing a 

breakout of leptospirosis in the community here, at least three people have died and 

FEMA is not releasing water to the community. Yesterday, people stood in line since 10 

p.m. the previous night in hopes FEMA would show up and give them food and water. 

To everyone's dismay FEMA showed up, but they were not there to get food or water, 

they were there to fill out paperwork. They handed one bottle of water and a snack pack 

of Cheez-Its. I saw many patients yesterday; there were so many I lost count. It was 

Kennedy Testimony 

Energy and Commerce Committee, Subcommittee on Energy 

The 2017 Hurricane Season: A Review of Emergency Response and Energy Infrastructure Recovery 

November 2, 2017 

Page 22 of26 
193 


really sad, however it's always amazing to see the spirit of the community. Neighbors are 

banding together to care for each other offering their last food to us not knowing if there 

will be any more food delivered to them." -Kent Savary, RN 

"It's hell here. The people have nothing. yet they are first to offer you the shirt off their 

back."- Laura Maceri, RN 

• "Today we went to a town called Barraquita. They had almost no water or food. They 

were desperate. Even asking if we had carried any water at all for them to drink. It was 

hard to even fathom the destruction and how they can even begin to clean it. They are 

relying on rain water and I million chickens died there in the stonn and the decomposed 

bodies arc causing people to be sick. There is hardly any way for them to clear the debris 

and they have little money, no way to work, and they are afraid to drive anywhere for 

help because they have little gas and they arc afraid what they will do if something 

happens to their car. We did a lot of teaching about purifying water for drinking, handed 

out solar lamps and a lot of emotional support. Overwhelming is the only thing I can say 

to describe it. They are even afraid to get aid dropped in their barrio because of the 

potential for violence."- Jordyn Olachea, RN 

• "FEMA is here with supplies, but out of approximately 40 towns accessed so far FEMA 

hasn't released food or water in ANY of them other than one air drop. The people of 

Puerto Rico are starving and have no access to water. People are dying from 

Leptospirosis, a specific bacteria in the water system. The situation is becoming dire." 

- Randcc Litten, RN 

• ''Yesterday we went to Utuado, a town up in the center ofthe island. We stopped many 

times along the way to educate people on water safety. It's a mountain community with 

small pueblos all over, many cut off since Maria by fallen bridges and blocked roads. We 

stopped in the center oftown at the National Guard. They had lists of all the areas that 

had been seen by medical groups. We went to an area that nobody had visited where 

roads were recently opened. People arc somehow surviving with the food and medicine 

they had on hand. They have received NO provisions. There is no running water and no 

electricity. Nobody is aware of the risks of drinking untreated water. We went house-tohouse teaching families and asking that they spread the word. We also provided urgent 

care where we could'' - Erin Carrera, RN 

Kennedy Testimony 

Energy and Commerce Committee, Subcommittee on Energy 

The 2017 Hurricane Season: A Review of Emergency Response and Energy Infrastructure Recovery 

November 2. 2017 

Page 23 of26 
194 


On the southern 

Red Cross or any 

wet furniture for weeks. 

Lucia Lopez gave the mother nv,rirr>rr:•rt'"''"'' 

The 2017 Hurricane Season: A 

where there has been no contact with FElvfA, 

in their roofless house on soaking 

tUI7Surro.rts.mr;•tvJ developed a rash. When RN 

burst into tears 

Kennedy Testimony 

and Commerce Committee, Subcommittee on Energy 

Fmeroenc·.v Response and Energy Infrastructure Recovery 

November 2, 2017 

Page 24 of26 
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NOTES 

' A collection of first-hand accounts by ~'\sin the delegation is available in the Appendix. 

''"Dashboard." Government of Puerto Rico. October 23, 2017. Viewed October 23, 2017. http://status.pr/ 

'""Hurricane Maria." Federal Emergency Management Agency. October 18, 2017. Viewed October 23, 2017. 

https :/ /www. fema. gov /hurricane-maria 

" Hauter, Wenonah. "A Month Later, U.S. Is Failing with Its Food and Water Crisis in Puerto Rico." Food and 

Water Watch. October 20, 2017 update. Viewed October 23, 2017. 

https://www.foodandwaterwatch.org/news/month~later~us-failing-its-food-and-water-crisis-puerto-rico 

' "Hurricane Maria." Federal Emergency Management Agency. October 18, 2017. Viewed October 23, 2017. 

https://www.fema.gov/hurricane-maria 

'' Melia, Michael. "Raw sewage contaminating waters in Puerto Rico after Maria." The Associated Press. Oct. 16 

2017. Viewed October 23, 2017. https://www.apnews.com/fc9e9238f77e4053a02832040ba0ea97/Raw-sewagecontaminating-waters-in-Puerto-Rico-after-Maria 

"'Newkirk, Van R., II. "Puerto Rico's Environmental Catastrophe." The Atlantic. Oct. 18,2017. Viewed October 

23, 2017. https://www.theatlantic.com/politics/archive/2017/l 0/an-unsustainable-island/543207/ 

""' Wolffe, Richard. "Puerto Rico: US officials privately acknowledge serious food shortage." The Guardian. 

October II, 2017. Viewed October 23, 2017. https://www.theguardian.com/world/2017/oct/11/puerto-rico-foodshortage-hurricane-maria 

''"Dashboard.'' Government of Puerto Rico. October 22, 2017. Viewed October 23, 2017. http://status.pr/ and 

''Examination of Cash Nutrition Assistance Program Benefits in Puerto Rico. 

https://www. fns.usda.gov/ snap/ exam ination-cash-nutrition-assistance-program-bencfits-puerto-rico, 

'"Dashboard." Government of Puerto Rico. October 23, 2017. Viewed October 23, 2017. http://status.pr/ 

" https://www.nytimes.com/2017/l OIJ9/usipuerto-rico-electricity-power.html, accessed October 23, 2017 

"'"Dashboard." Government of Puerto Rico. October 23, 2017. Viewed October 23, 2017. http://status.pr/ 

"""Hurricane Maria." Federal Emergency Management Agency. October 18,2017. Viewed October 23,2017. 

https://www.fema.gov/hurricane-maria 

"'Acosta, Deborah and Frances Robles. Puerto Ricans Ask: When Will the Lights Come Back On?" Time. October 

19, 2017. Viewed October 23, 2017. http:/itime.com/4988841/puerto-rico-hurricane-maria-numbers-recovery/ 

" "FEMA Tarps and USACE Blue Roofs Aid in Protecting Homes From Further Damage." Federal Emergency 

Management Agency. October 19, 2017. Viewed October 23, 2017. https://www.fema.gov/newsrelease/20 17/1 0/19/4339/fema -ta rps-a nd-usace-blue-roofs-aid-protecting-homes-fu rther-damage 

"'"Dashboard." Government of Puerto Rico. October 23, 2017. Viewed October 23, 2017. http://status.pr/ 

"."Moreno, Carolina. "Doctors Fear a Potentially Deadly Disease Outbreak in Puerto Rico." Jhiffington Post. 

October 20, 2017. Viewed October 23, 2017. https:liwww.huffingtonpost.com/entry/leptospirosis-outbreak-puertorico-hurrincane us 59e905aae4b0f9d35bc969ac 

"'"Rodriguez, Carmen Heredia and Rachel Bluth. "Puerto Rico's Health Faces 

October 16, 2017. Viewed October 23, 20 17.)illru;.;if:!,:lllC.!l~!§s.;!P£:&J;l!lliid.>~lill~@JlCZll§. 

"'Hernandez, Daniela. "A U.S. Navy Hospital Ship Was Sent to Puerto Rico-··lt's Barely Been Used." Wall Street 

Journal. October 19, 2017. Viewed October 23, 2017. https:i/www.wsj.com/articles/why-a-u-s-navy-hospital-shipin-puerto-rico-has-hardly-been-used-15084 3 3604 

Kennedy Testimony 

Energy and Commerce Committee, Subcommittee on Energy 

The 2017 Hurricane Season: A Review of Emergency Response and Energy Infrastructure Recovery 

November 2, 20 17 

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" Santiago, Leyla and Mallory Simon. "There's a hospital ship waiting for sick Puerto Ricans-- but no one knows 

how to get on it." CNN. October 17, 2017. Viewed October 23, 2017. 

http://www.cnn.com/20 17 II 0/16/health/puerto-rico-hospital-ship/index.html 

'·" Auwaerter, Paul and Melanie Thompson. "Puerto Rico and U.S. Virgin Islands Need Urgent Aid Now to Avert 

Public Health Crises." Infectious Diseases Society of America. October II, 2017. Viewed October 23, 2017. 

http://www.idsociety.org/Ncws and Publications/IDSA News Releascs/2017/Pages/Puerto Rico and U S Virg 

in Islands Need Urgent Aid Now to Avert Public Health Crises.aspx 

"""CDC Health Alert Network (HAN) Health Advisory: Advice for Health Care Providers Treating Patients in or 

Recently Returned from Hurricane-Affected Areas, Including Puerto Rico and the US Virgin Islands." Centers for 

Disease Control and Prevention. October 24, 2017. Viewed October 24, 2017. 

https://content.govdelivery.com/accounts/USCDC/bulletins/1 bfb61 d 

"';'Moreno, Carolina. "Doctors Fear a Potentially Deadly Disease Outbreak in Puerto Rico." lhiffington Post. 

October 20, 2017. Viewed October 23, 2017. https://www.huffingtonpost.com/entry/!eptospirosis-outbreak-puertorico-hurrincane us 59e905aae4b0f9d35bc969ac 

""Moreno, Carolina. "Doctors Fear a Potentially Deadly Disease Outbreak in Puerto Rico." Hzifjington Post. 

October 20, 2017. Viewed October 23, 2017. https://www.huffingtonpost.com/entry/leptospirosis-outbreak-puertorico-hurrincane us 59e905aae4b0f9d35bc969ac 

Kennedy Testimony 

Energy and Commerce Committee, Subcommittee on Energy 

The 20 17 Hurricane Season: A Review of Emergency Response and Energy Infrastructure Recovery 

November 2, 20 17 

Page 26 of26 
197 

Mr. OLSON. Thank you, Mrs. Kennedy. 

And now is the fun time, questions from the Members. And the 

Chair will yield to himself for 5 minutes of questions. 

My first questions are for you, Mr. Thompson. First of all, I have 

to say congratulations. I mean, I was there for Hurricane Ike, 

Tropical Storm Allison. I was there for Hurricane Harvey. Most of 

our capacity was in that storm. You guys came roaring back. So, 

congratulations for getting that turned around so quickly. 

I have talked to a lot of people. You guys have gotten much better preparing for hurricanes or sort of natural disaster. Yes, we are 

going to take a hit; we know it. I have heard like with Katrina, 

Rita, and Ike, you all learned how to not fully shut down our refinery, but keep it warm, so to speak, not the complete shutdown, but 

keep it going where it is that risk of some sort of breach. But, once 

the storm clears, get that thing up like that. 

So, I just want you to talk about how you prepare a refinery that 

is directly in the path of a storm like Harvey to make sure to get 

that thing back online as quickly as possible. 

Mr. THOMPSON. Well, thank you for the question, and I address 

some of this in my opening remarks. Most of this, of our ability to 

weather the storms, one was our credible workforce. We literally 

had thousands of people that were riding out these facilities. When 

their own families and houses were in peril, they were helping 

keeping our facilities literally above water and ready to go. 

Also, lots of preparation. We have been working on storm for 

years, working with the National Petroleum Council, working with 

DOE and DHS. This was not something that we prepared for just 

a few weeks ago. 

We took all the lessons learned from prior storms and we put 

them in the action. We hardened our infrastructure. We elevated 

what we could elevate. We have much better storm-tracking capabilities now. So, we could identify exactly where the storm was 

going and identify when we had to bring the systems down. 

Safety is the No. 1 responsibility. So, our facilities will come 

down when safety demands it. And so, for those facilities where 

they realized that they weren’t going to be hit as hard, they could 

remain warm and ready to go. Some of the facilities, indeed, had 

to come all the way down. 

So, I would just end by saying a lot of hard work, a lot of dedication. And again, we can’t applaud our employees enough. 

Mr. OLSON. And lessons learned, which I know it just goes with 

the territory. You will have some leaks, some chemical leaks, you 

know, whatever. For example, we have these big tanks that have 

floating tops. And the water got so high, almost 5 feet of rain overcame the capability, and you had some small leaks. 

So, my question is, what are you all doing to prevent and respond to these spills before they happen? Because I know it is 

amazing what happened. I mean, it was such a stellar performance. But how do you make it even better going forward? 

Mr. THOMPSON. Well, I can assure that every company, those impacted and those that even weren’t directly impacted are assessing 

how we responded to the storm, what went well, what didn’t go 

well. We, as a trade association, bring our members together. We 

198 

share information. And we will work to improve. Very storm, we 

learn from the prior one to get better. 

Mr. OLSON. Thank you. 

A question for you, Mr. McBrayer. I mean, I was driving around 

pretty much for a week after Harvey hit and you could find gasoline. Some shops were shut down. My question is, was that because 

of power, because of lack of supply, lack of the gasoline, or lack of 

the employees being able to get to work because of all the floods? 

So, what was going on there? Because, again, you could find it, but 

some stations weren’t up and running and, as you mentioned, there 

was some price gouging because of all sorts of rushes because people are panicking that there will be no gasoline. 

Mr. MCBRAYER. All of the things that you mentioned, Mr. Vice 

Chairman, are correct. Some of it is due to the fact that we rely 

upon the employees who are living in the affected area. And like 

any good employer, we are more concerned about their life at home 

and being sure that they are prepared to meet the needs of their 

family before they return to work. 

We do have some problems with the electrical supply. Getting 

generators into our stores, specifically, was quite challenging in the 

Houston area because of the amount of flooding in the roadways. 

There are some stores that just choose not to buy at the costs that 

tend to go up during these disasters. 

But most everyone is working hard because in our business we 

build 50-year assets. We are there for a long time. And so, our 

long-term mentality is to provide what our guests, our consumers, 

need, and to work hard to do that. 

It is a site-by-site issue as to what the problems are and what 

we may need to do. We have stores in the south Houston area with 

some water in tanks. We have had stores that were completely 

flooded out that are still yet to reopen. But you have to assess your 

assets one at a time and do things you can quickly in order to bring 

them back online. 

Mr. OLSON. One further question, Mr. Fanning. You brought up 

UAVs, and that is a big deal, hard back home. A town called Missouri City had some levies, not so much oil production, but levies 

that may be breaching. They were fine, the UAVs, they could see 

it and, then, they were grounded. So, how about the role of UAVs 

in these disasters for oil and all the operations with the petrochemical industry? Because those things are working and, for some 

reason, they were shut down because there was some kind of danger. And that was just not right to do because of that breach; they 

may have prevented a breach because they saw it with the UAVs. 

So, any idea about oil and gas operations, refining, storage, whatever, that UAVs could help out? 

Mr. FANNING. Yes. Well, we don’t impact oil and gas particularly. 

But, in response to any storm, there should be a comprehensive 

plan that is undertaken, really driven by the local authorities. 

I was listening to your prior panel. Very interesting, in that 

every utility works with—for example, in Georgia, they would work 

not only with the Federal agency FEMA, but with GEMA. Within 

that context, all critical infrastructure is evaluated with respect to 

the approaching threat. And therefore, we develop a set of priorVerDate Mar 15 2010 12:53 Mar 12, 2018 Jkt 037690 PO 00000 Frm 00202 Fmt 6633 Sfmt 6633 C:\USERS\WLAUFERT\DESKTOP\115X72X2017HURRICANESWORKING WAYNE
199 

ities and, essentially, a response regime as to how to provide the 

best benefit going forward. 

I can’t speak to Missouri or whatever the impact is there, but I 

would assume that they have taken those things into account. 

Mr. OLSON. Thank you. I am aware of my time. 

The Chair now recognizes the gentleman from Illinois, the ranking member, Mr. Rush, for 5 minutes. 

Mr. RUSH. I want to thank you, Mr. Chairman. 

Ms. Kennedy, your testimony has been very, very amazing testimony. I am amazed at the breadth of the tragedies that are occurring, even as we speak, in Puerto Rico. And I amazed at the lack 

of proper attention by those in our Government in determining 

their response to this American tragedy in Puerto Rico. 

There are some who are disputing the official death toll. Some 

say that, oh, 51 casualties due to the hurricane. But, yet, the Puerto Rican Department of Public Safety confirmed that over 900 bodies have been authorized for cremation since Hurricane Maria tore 

through their island on September the 20th. And that 900 figure 

includes deaths related to lack of oxygen and other fatalities that 

appear to be due to the power outage. Yet, some say that those fatalities should just be considered natural deaths. 

Do you concur with this definition from your experiences? You 

have spent time there. Do you believe that the death toll from Hurricane Maria is actually 51 or is it closer to 900, or is it somewhere 

in between? 

Ms. CATHERINE KENNEDY. Well, thank you for the question. 

We were there from October the 4th through the 18th. And as 

I said in my testimony, what the nurses saw was that, when you 

get outside of San Juan, that they were pretty much cut off from 

electricity, from communication, from anything. So, when you ask 

me what was the death toll, do I believe whether it is 51 versus 

911, or somewhere in between, personally, I think it is more of the 

higher. 

What we saw was people were desperate. We were considered almost the first ones that they even saw as it relates to food or 

water, or any kind of communication. And through word of mouth, 

they did say that the neighbor passed, whether it was through leptospirosis or natural causes—you mentioned the lack of electricity 

and without oxygen. So, yes, I think it is rather on the high side. 

Mr. RUSH. Mr. Nieves, do you have any further insight into the 

actual number of fatalities and the reason for those fatalities? 

Mr. NIEVES. Yes. Basically, I really agree with Ms. Kennedy. The 

official death toll of 59 up until now is very superficial and misleading. By personal experience, I have talked with dozens of family, friends, that have told me, ‘‘Oh, my grandmother died. She 

passed because she didn’t have electricity in her nursing home.’’ A 

lot of elderly people that do not have electricity are simply dying. 

And so, how can you relate that to Hurricane Maria? It is very 

difficult because it didn’t happen that day. But the death toll is, 

in my view, in the hundreds. 

Mr. RUSH. So, even today, as we sit here in this committee room, 

there are people who are still dying in Puerto Rico simply because 

they have no electricity, even today? 

200 

Mr. NIEVES. Yes. As I said in my testimony, people are dying 

today not because of Hurricane Maria, but because of Hurricane 

PREPA, because they don’t have electricity in their homes and care 

centers. 

Ms. CATHERINE KENNEDY. I would agree. Without electricity, 

without power, you know, there are stories where patients actually 

go to San Juan when the electricity is up, and they take their 

nebulizers and plug them in, so that they can do the breathing 

treatments. Or they may sit in clinics where they have access to 

oxygen and use the oxygen there throughout the day, and then, 

they go home where there is no electricity and they are without oxygen, without anything. 

Mr. RUSH. Thank you, Mr. Chairman. I yield back. 

Mr. OLSON. The gentleman yields back. 

The Chair now calls upon the gentleman from Illinois, Mr. Shimkus, for 5 minutes. 

Mr. SHIMKUS. Thank you, Mr. Chairman. 

It is great to have you here. I want to direct some of my questions to Mr. Fanning. 

Mr. Fanning, if the electricity went out in Atlanta, Georgia, who 

would get called? 

Mr. FANNING. Initially, Paul Bowers, President of Georgia Power 

Company, but that is a pretty clear deal. 

You know what is interesting in these storms, we have, essentially, people that run the storm activity. They are fully empowered 

to work with whatever State, local, Federal government, to get the 

lights on as fast as we can. They have a clear sense of priority and 

they get the job done. 

Mr. SHIMKUS. Again, Puerto Rico is an island. It is very difficult, 

and I kind of wish the administration would have deployed the 

82nd Airborne and just had a parachute jump into a lot of communities that don’t have access. At least there would be a meal ration. 

And the military has even solar packs that they take in Afghanistan. If there was one thing I wish they would have done more 

than anything, it is really deployed. 

But you also heard in the first panel that the fact that there was 

no request for help until five weeks later. That is not normal. I 

mean, you represent the Electricity Subsector Coordinating Council. 

Mr. FANNING. That is right. 

Mr. SHIMKUS. Isn’t that something that you all do as part of 

that? 

Mr. FANNING. Absolutely. In fact, I would argue, especially this 

year—the Electricity Subsector Coordinating Council was originally 

formed to focus on cyber and physical security. We have added to 

that, given the success we have demonstrated on those issues, this 

notion of storm response. 

Following Sandy, the electric utility industry reorganized what 

we call regional mutual assistance groups. And so now, under the 

kind of structure of the ESCC, we bring together, really for the 

first time, an enhanced collaboration, not only of investor-owned 

utility responses, but also collaboration/coordination with municipal 

utilities, cooperative utilities. 

201 

We offer that up and we participate in a series of restoration activities, Federal Government, local, and with each other. And we do 

that, also, interdependent with the other kind of industries that 

you all were talking about in the last segment. And that is telecom, 

so important; water and sewer; health care. 

Believe it or not, we go beyond the notion of offering assistance 

just for the restoration of electrons. In Houston, particularly, my 

company got called on for two things that had nothing to do with 

electricity. 

One was for the humanitarian rescue effort. Within 20 minutes 

of a phone call, we sent forward pilots and drones to help identify 

where survivors and other people may be. 

Secondly, through Alabama Power, we delivered machinery that 

was able to operate in very high water conditions that were used 

to help rescue people. 

Mr. SHIMKUS. Thank you. 

And PREPA, or the Puerto Rican Electric Power Authority, they 

are not involved in this group, are they? 

Mr. FANNING. So, PREPA works under the aegis of the American 

Public Power Association, which is, essentially, a municipal organization. We offered help, but PREPA, the State of Puerto Rico, for 

whatever reason, elected to pursue a different path, not pursue the 

mutual assistance rubric and really go through bilateral—— 

Mr. SHIMKUS. Yes, and let me go to the elected representative, 

Mr. Nieves. When we look back now on lessons learned and how 

we want to move forward, would you agree that we probably should 

look at ways in which the whole community can be helpful and develop these memorandums of understanding where we can get joint 

use and quick response? That would be probably a pretty good lesson learned in this? 

Mr. NIEVES. Well, the thing is, the fact is that the American Public Power Association, and I understand that at least the Electric 

Institute offered since day one mutual assistance to PREPA, but 

PREPA pursued another way. So, it is not a lack of an agreement, 

but it was a lack of will from PREPA’s part. And then, we have 

the Whitefish situation. 

Mr. SHIMKUS. Yes, yes. And I am sure we are going to have time 

to continue to look at that. But, believing your testimony, which I 

do, that is, I would call that criminal negligence. And I am sorry 

for that. 

My time has expired, Mr. Chairman. I yield back. 

Mr. OLSON. The gentleman yields back. 

The Chair now calls upon the gentlewoman from Florida 14, Ms. 

Castor, for 5 minutes. 

Ms. CASTOR. Thank you, Mr. Chairman. 

Thank you all very much for being here. 

The more we hear directly from folks like you that are in the 

U.S. Virgin Islands and Puerto Rica, the more disturbing it gets. 

I think you can sense the outrage building from this committee 

over the Puerto Rico Electric Power Authority. 

Mr. Nieves, are you surprised that PREPA did not respond to 

this committee and, in essence, refused to appear here? 

Mr. NIEVES. I am sad to say that I am not surprised. When I 

used to Chair the Senate’s Energy Committee, one of the things 

202 

that we found is their total lack of transparency. So, to me, I assume this is a lack of respect for this committee that PREPA is not 

here on this group. 

Ms. CASTOR. And were you surprised to hear Mr. Alexander, who 

is the lead for the U.S. Army Corps of Engineers in repairing the 

grid in Puerto Rico, were you surprised to learn that he hasn’t even 

been able to have a conversation with PREPA. 

Mr. NIEVES. Sadly, I am not surprised. 

Ms. CASTOR. So, how do we justify taxpayer dollars now going to 

repair a grid in Puerto Rico, trying to work with PREPA after they 

refused to interact with the committee? They are not working with 

the Army Corps of Engineers. They are wasting taxpayer money 

through this Whitefish contract that has outraged so many people. 

And yet, the need is so great on the island. How do you recommend 

that we move forward? We are going to have to address the PREPA 

situation in law as soon as possible, I would assume. 

Mr. NIEVES. Yes. First of all, we have to really understand and 

consider at the end of the day, given PREPA’s governance problems, we need to think that people are dying. Our economy is 

dying. So, how do we work around that, or PREPA’s lack of governance and transparency? 

My suggestion, and that I did in my testimony, is that since Congress already passed the PROMESA act, and the oversight board 

named a Revitalization Coordinator that has been appointed to 

take over PREPA, that Congress finds a way, a mandate, a specific 

mandate, that Federal taxpayer money to create a new energy grid 

be under the supervision of the Revitalization Coordinator of the 

board and the Puerto Rico Energy Commission, which is an independent, non-political, nonpartisan, and highly technical body. So, 

you can bypass PREPA and the government of Puerto Rico. So, 

that could be a way to get around it. 

Ms. CASTOR. And this has to be, we have to have a sense of urgency to do this, because they are talking about the next emergency bill maybe will be in December, hopefully. I mean, there is 

a lot of things on the agenda for Congress in December. But time 

is of the essence here. 

Mr. NIEVES. Yes. 

Ms. CASTOR. And, Colleagues, we simply have to find a way to 

at least begin to plan to build in some resiliency, get the power on, 

but begin to lay the groundwork for a modern electric grid, and address the ineptitude of the Puerto Rico Electric Power Authority. 

Lives hang in the balance. 

We have the experts at our fingertips. We have the technology 

to do this. Does Congress have the capacity to act with a sense of 

urgency, knowing how our fellow citizens are suffering there? So, 

that is a challenge for us. 

So, I thank you all very much for being here. 

And I yield back my time. 

Mr. OLSON. The gentlelady yields back. 

The Chair now calls upon the gentleman from Mississippi, Gregg 

Harper, for 5 minutes. 

Mr. HARPER. Thank you, Mr. Chairman. Congratulations to the 

Astros. 

Mr. OLSON. Thank you. 

203 

Mr. HARPER. And I know it was a great series. 

I want to thank each of you for being here. This is still something that just is stunning, the hurricanes we have had to deal 

with this season. And certainly what has happened in Puerto Rico 

has concerned us all. 

So, Mr. Fanning, I know you mentioned that it is more than just 

power or restoration of power. It is also telecom, water and sewer 

issues. Can you talk for a moment and tell us how utilities use 

their communications network to recovery and respond from hurricanes and other weather-related events, and how reliable do those 

communications networks need to be? 

Mr. FANNING. Yes. Thank you, Congressman, and thank you for 

your service to the great State of Mississippi. 

Mr. HARPER. Thank you. 

Mr. FANNING. The best example of that is Katrina, as you well 

know. I think Katrina and the national story gets told around New 

Orleans in the breaching of the dam. The truth is, in Mississippi, 

when Katrina came through, every light was out around Mississippi Power. 

And when you went in to try to restore that activity, the streets 

were unrecognizable. You couldn’t even use, essentially, GPS to 

find your way around. All of the telecom was out as well. 

We have to have an interconnected effort between telecom and 

electricity in order to most efficiently respond to these sorts of disasters. Southern Company, as a matter of its own resilient strategy, has our own dedicated telecom company called Souther Linc, 

in which we can bring in mobile cells on wheels, towers essentially, 

to set those things up. 

As I am working within the context of the ESCC as it relates to 

Puerto Rico, early on—and this is where the ESCC was not asked 

to help in a mutual assistance effort—but, still, we were working 

with different parts of the economy to try to bring help to that island. 

I called personally John Donovan. He is roughly the No. 2 guy 

at AT&T, as I understand it. And also, at—hold on—at Verizon, 

Lowell McAdam, who is the CEO there, to link together our efforts 

in bringing help down there. And we assured each other that, between telecom and electricity, we would provide every level of support, whether it was even asked for or not, to try to get that situation rectified. 

Congressman, it is critical. If we are going to communicate with 

people in the field, if we are going to have people in the field without telecom, we need some way to kind of communicate to get the 

stuff back on. It is absolutely critical. 

Mr. HARPER. So, you provided assistance in that area, even 

though it was not requested by PREPA? 

Mr. FANNING. That is right. And in fact, I will give great kudos 

to the folks at FEMA, whether it is Brock Long who has done a 

heck of a job. I was on the floor of FEMA during a weekend during 

this situation. Another guy that works in DHS, Chris Krebs; in the 

White House, Tom Bossert, all of these people have been champions in trying to aid the situation without a whole lot of encouragement. 

Mr. HARPER. Got you. 

204 

You know, Southern Company is right in the middle of what I 

guess we would call the hurricane belt. But Southern Company has 

a long and good track record of restoration after a hurricane, not 

only in your home service area, but helping your neighbors, certainly through the ESCC and others. 

Have you seen changes based on lessons after Katrina that you 

are using today to improve that? 

Mr. FANNING. Oh, sure. We have this mantra I had in my opening statement. We want to be today better than yesterday; tomorrow better than today. And no matter how good we think we are, 

we can always be better, me included. 

And we are accountable for always improving. When you think 

about some of the testimony, life-and-death matters that are at 

stake here, you know, it isn’t just about electrons; it is about restoring hope to communities and people’s ways of life. 

And so, we always work hard to think about what we can do better. I think the latest iteration, whether it is Harvey, whether it 

is Irma, the ESCC has demonstrated a much better capability of 

working across not only investor-owned utilities, munis, and coops, 

but also across cross-sector industries, telecom, finance—— 

Mr. HARPER. Right. 

Mr. FANNING [continuing]. Water, et cetera. And so, those are 

particularly good things. 

The other thing is this whole notion—and we have heard a lot 

about new technology being brought to bear. Good heavens, we deployed that in terms of resiliency as a strategic objective of America, whether it is cybersecurity, protection against terrorists from 

a physical standpoint, but also against natural disasters. 

Mr. HARPER. Fine. Thank you, Mr. Fanning. 

My time has expired. I yield back, Mr. Chairman. 

Mr. OLSON. The gentleman yields back. 

The Chair now calls upon the gentleman who made sure that 

Texans signed Justin Verlander to get us through the playoffs here, 

Gene Green, Texas 29. 

[Laughter.] 

Mr. GREEN. I wish I could claim, except going to a couple of the 

games. But thank you, Mr. Chairman. 

Mr. Thompson, you talk about how quickly refined production 

was back online after Harvey. And I would like to commend the job 

industry did in our district, because in east Harris County we have 

five refineries. I sat down and met with Lyondell refinery and, also, 

with Shell. And a lot of folks don’t understand you just can’t turn 

switches off and on and get them back up. But now the price of gas 

is going down because all those refineries are back up. I know in 

our area—and I assume over in Beaumont-Port Arthur also—I 

know a lot of my constituents worked around the clock to get that 

back up. 

One of the concerns I had, though, was the issue with the tanks. 

In east Harris County, we have the tanks that are—we keep building them because it is either holding crude or product or whatever. 

The engineering of them now is a floating roof. Because of the 

amount of water that hit the top of that, it actually turned that top 

over, and water went into whatever product was there. It could 

have been crude oil; it could have been refined products, and emisVerDate Mar 15 2010 12:53 Mar 12, 2018 Jkt 037690 PO 00000 Frm 00208 Fmt 6633 Sfmt 6633 C:\USERS\WLAUFERT\DESKTOP\115X72X2017HURRICANESWORKING WAYNE
205 

sions from that, but also overflowing. Because when you get 52 

inches of rain anywhere, you are going to have a problem. 

Has the industry looked at what we are going to do? I know, 

talking with the two companies, they said, we are going to have to 

look at it because how do we plan for 52 inches of rain. But see 

if engineering-wise there is a way we don’t repeat that problem if 

we have another—well, not if; it is when we are going to have another storm because on the Texas Gulf Coast—I am a native 

Houstonian; we have lived through them, and we will get through 

this, too, but it is not pretty. But we need to learn from our mistakes if we have another 52-inch rain in those plants. 

Has there been talk about how, across from API—because, like 

I said, just talking with two companies, they said they had to look 

at it and see what is going on. 

Mr. THOMPSON. Thank you for the remarks. 

Yes, our industry, as I have said open remarks, we fared fairly 

well. We proved to be resilient. We weren’t perfect by any stretch 

of the imagination. We were better prepared than we were in prior 

storms. We have installed a lot of floating roofs, which you know 

are better for the environment. In the normal States, emissions are 

much lower. 

But we weren’t prepared for 60 inches of rain at times. And so, 

some tanks did have some failures. But the key is that was the exception and not the rule—— 

Mr. GREEN. Yes. 

Mr. THOMPSON [continuing]. For sure. And I can assure you that 

this is already a No. 1 topic of conversation, about to prevent this 

going forward, and there will be lots of discussion. And I am sure 

there will be engineering to make sure these problems don’t happen going forward, to the best we can. 

Mr. GREEN. OK. Can you talk a little bit about the difference in 

how quickly the refining sector came back up online, and the difficulty, how long it took for the petrochemical sector in Houston? 

Mr. THOMPSON. Yes. Well, certainly the refining industry came 

back online a little bit more quickly. A lot of that was from preparation. The petrochemical side, we knocked out, as you know, 60 

percent of the national capacity, 80 percent in the Gulf. About 75 

percent of that capacity has returned to the industry. Some of our 

facilities, they were under lots of water and it has taken a lot of 

time to get those facilities back up. Repairs have had to be made, 

and that just takes time. But we are well on our way. We think 

we have turned the corner and, hopefully, we will be back up to 

full capacity soon. 

Mr. GREEN. And I also know that you can tell that at the price 

at the pump because the prices went up 25–30 cents a gallon, but 

now it is back down, maybe not in Washington, but at least in 

southeast Texas it has gone back down to maybe a little higher 

than it was, but still it is not $2.49; it is $2.19 that you can get 

on the side of the road now. 

Mr. THOMPSON. And certainly we are getting back closer to 

prehurricane levels, but one thing I will point out is, since that 

time, the price of crude oil is certainly higher. 

Mr. GREEN. Yes. 

206 

Mr. THOMPSON. And so, some of that is being reflected at the 

pump as well. 

Mr. GREEN. Yes. 

I yield back, Mr. Chairman. Thank you. 

Mr. OLSON. The gentleman yields back. 

The chairman now calls upon the House’s best birdwatcher, the 

man from the Commonwealth of West Virginia—— 

Mr. GRIFFITH. Virginia. 

Mr. OLSON. I am sorry. Virginia. I am confused. 

[Laughter.] 

Mr. GRIFFITH. You have been in the chair a long time. 

[Laughter.] 

I appreciate it. 

Mr. OLSON. Five minutes, my friend. 

Mr. GRIFFITH. Thank you very much. 

Mr. Fanning, Mr. Harper touched on this a minute or two ago, 

but making sure we have lines of communication up. The National 

Infrastructure Advisory Council, noting this absolute criticality 

that communications play in grid resilience, suggested that electric 

utilities may need some dedicated spectrum space. What do you 

think? 

Mr. FANNING. Well, listen, there is a number of solutions that go 

to that very important problem. Even to be provocative, in the circumstance of a national emergency, should you have dedicated 

internet access? There is a lot of things that you need to clear the 

way for. 

Let me just give great kudos. So many people today I think lose 

faith in Government and the institution and the people that run it, 

and all that. I can say without equivocation that, in response to 

these events, whether it is in the White House with Tom Bossert, 

whether it is Energy Secretary Perry, one of the things that we can 

do is to work with these folks. And these folks can clear the way 

to get the work done. 

So often, I think the question goes to who is in charge. You know 

who really knows how to get stuff done are the line crews and the 

supervisors and the people that have the boots on the ground to get 

this done. And when there are barriers, what we have got to do is 

work in this effective public/private partnership to get whatever 

barriers exist cleared away. The Government in this case has been 

fabulous during Harvey and Irma particularly. 

Mr. GRIFFITH. I appreciate that, and thank you for your answer. 

Mr. Rhymer, I was very pleased, as I was listening to your testimony, to hear you talk about microgrids and what you all are planning on doing. I particularly like the way you described how you 

are going to have them interact with the full system, and then, if 

they need to be standalone—I thought that was very good and I appreciate it. I hope you all success in that, and I look forward to seeing it at some point when it is working, because I think that is 

helpful. Not just in the islands, but in mountains and other regions 

of the United States those kinds of concepts can be very, very helpful. So, thank you for that. 

Mr. RHYMER. Thank you. 

Mr. GRIFFITH. Mr. Nieves—did I say that close to right? Thanks. 

207 

I appreciated your stark comments. It seems that there have 

been a lot of problems with the electric utility in Puerto Rico for 

some time, based on your comments. I am just wondering, you 

know, the Federal Government is going to be asked to come in 

there and spend a lot of money. I understand that and think that 

is right. But, if we do so, are you willing—do you think that the 

Government there, particularly the electric utility, is going to be 

willing to introduce some of these novel concepts like microgrids, 

and working on ways to use Puerto Rico as a land of experiments 

where we can try different things? They won’t all necessarily work, 

but things that we can do to try to make the grid better long time, 

and try out some of these new ideas that are out there that have 

been talked about for years, but we have never had an opportunity. 

And for all the tragedy that is taking place in Puerto Rico, for 

which I am very sorry and worry about figuring out what we can 

do, we may have the opportunity to do something better. Do you 

think that the utility company would be willing to embrace some 

of that? 

Mr. NIEVES. Well, my proposal during testimony is that, if the 

Federal Government is going to step up and allocate considerable 

resources to not just repair the old grid, but to create a new grid, 

you cannot do that alone. You have to also establish a specific mandate in the law saying we are appropriating this ‘‘X’’ amount of dollars to build a new grid for Puerto Rico, but with these specifications. 

And I respectfully submit that macrogrids could work; regional 

microgrids for Puerto Rico could really work to create a strong, resilient system. That might as well be ordered by Federal law. 

Under Puerto Rico local law that I worked on last year when I 

was a senator, we authorized microgrids. And the Puerto Rico Energy Commission is right now working on an expedited regulation 

to put them in place. But I really submit that ‘‘X’’ amount of dollars 

appropriated by our Federal Government have to be with a specific 

Federal mandate. 

Mr. GRIFFITH. And I appreciate that and would agree that we are 

going to have to do some different things there. One of the things 

that I think might help is if we have the utility accountable to 

shareholders. I don’t know how you would spin that off with the 

assets they have. But I noticed from your comments that one of the 

problems was that you had, while it was a semi-regulated monopoly, it was a nonprofit. And it is amazing, when you are trying to 

figure out ways to make yourself more efficient, you come across 

ways to make at least a little bit of profit, even if it is not required 

to be much profit. Anyway, it is a thought to think about, and I 

hoped that you would consider that as well. 

And my time is way over. So, I have to yield back. Thank you. 

Mr. NIEVES. Thank you. 

Mr. OLSON. The gentleman from the Commonwealth of Virginia 

yields back. 

The Chair now calls upon the gentleman from Amsterdam, New 

York, Mr. Tonko, for 5 minutes. 

[Laughter.] 

Mr. TONKO. Thank you, Mr. Chair. 

208 

Mr. Rhymer, your testimony mentioned that the Water & Power 

Authority had used FEMA hazardous litigation grants to bury infrastructure underground, making it more resilient. When did you 

receive those grants? 

Mr. RHYMER. We received those grants approximately in 2010– 

2011. 

Mr. TONKO. OK. 

Mr. RHYMER. And we have underground a portion of St. Thomas 

and a portion of St. Croix. We are currently seeking additional hazardous litigation grants currently to underground St. John in the 

Cruz Bay area and additional parts of St. Thomas and St. Croix. 

Mr. TONKO. OK. And is there any other FEMA money you are 

asking to secure beyond that burying of cable? Anything with your 

microgrids? Are you requesting—— 

Mr. RHYMER. Well, we are seeking to get litigation grants for the 

microgrid stuff, renewable energy stuff that actually adds to the 

microgrid. We are also looking to do some hardening of the system 

in terms of administration, in terms of the buildings. Like the line 

department building is completely destroyed. So, basically, we need 

to have that building be resilient. 

Mr. TONKO. Thank you. 

New York State and the utilities there benefitted greatly from 

mutual assistance in the aftermath of Superstorm Sandy. And now, 

it is our turn to be called upon. It is your turn to be called upon 

in making things better. 

Mr. Fanning, do you believe the utility industry’s mutual assistance efforts work well? 

Mr. FANNING. Oh, they are outstanding. 

Mr. TONKO. I know islands present unique challenges to mobilizing workers and equipment, but can you think of specific reasons 

why mutual assistance would be resisted? 

Mr. FANNING. No. 

Mr. TONKO. OK. Mr. Nieves, you testified that Puerto Rico’s grid 

had limitations certainly in the amount of renewable resources that 

could be integrated into its energy mix. What were the reasons for 

that? 

Mr. NIEVES. Yes. According to a 2014 report that PREPA received, the grid, as it stood before Maria, could only integrate up 

to 580 megawatts of renewable power. Renewable power has certain technical issues that the grid that we had could not really tolerate without jeopardizing the system. 

Mr. TONKO. Is it a matter of better interconnect devices? There 

is technology already shelf-ready, I would believe, that might be 

able to help—— 

Mr. NIEVES. That is correct. 

Mr. TONKO [continuing]. Your situation? 

Mr. NIEVES. Well, PREPA’s grid was not a smart grid. It was not 

a grid that could really accommodate a system whereby customers 

are also generating power, renewable power, so they are not just 

passive customers of our energy model. So, according to that report 

from Siemens, PREPA’s grid only can tolerate up to that amount 

of renewable power, which is really unacceptable, and a really 

small amount. 

209 

Mr. TONKO. And, Ms. Kennedy, thank you for making it so clear 

that Puerto Ricans are still dealing with a life-and-death situation. 

Can you further explain the health impacts you have seen due to 

a lack of safe water in Puerto Rico? 

Ms. CATHERINE KENNEDY. Sure. Like I said, we were there for 

about two weeks. One of the things that the nurses had to go out 

and do was really within the community to take a look at what 

kind of resources were available. Time and time again, it was the 

lack of clean running water. 

One of the things that the nurses saw was that people were very 

desperate. So, they were actually drinking from river water. Water 

that came down they would save from their roofs. As you know, 

with hurricane, you have rodents and, of course, bacteria. So, the 

prospect of leptospirosis was imminent. And clearly, there were 

people that were infected, but, again, if treated properly, then, I 

mean, it wouldn’t be life threatening. But these were things that 

we saw for the last two weeks. 

Mr. TONKO. Right. I have also seen some photos shared with me 

by family members in my district. They cause grave concern. 

I believe—and I think Ms. Kennedy would agree—that we need 

to have a serious discussion about waiving cost-sharing requirements, especially for critical public health infrastructure such as 

our water systems. It is a public health and public safety situation. 

I would also express that Puerto Rico can learn a great deal from 

New York’s REV Initiative. It was in response to the Superstorm 

Sandy situation. And that State, our State, my home State, has 

worked to understand changes in the traditional utility business 

model and how to plan for a more decentralized grid. 

My concern is that, if we build back to this failed system that 

you cite, it is a very troublesome investment made by any level of 

Government and the private sector, and we need to do better than 

that and encourage smart, flexible, and reliable grid for a cleaner 

and stronger energy future. 

And with that, I yield back. And congratulations on last night. 

Mr. OLSON. Thank you, thank you, thank you. 

The gentleman yields back. 

The Chair now calls upon the gentleman from our neighbor to 

the north, Oklahoma, Mr. Mullin, for 5 minutes. 

Mr. MULLIN. Chairman, you are in almost a giddy form today. I 

wonder why. 

[Laughter.] 

Mr. OLSON. Guilty as charged. 

Mr. MULLIN. The best thing is the third baseman for the Dodgers, I guess, can shave and cut his hair now, right? 

Hey, I appreciate you guys coming up here and informing Members of Congress. It is very important for us to have a working relationship in a situation like this. 

It has been a long day, and I appreciate your all’s patience. But 

I feel like we are going to continue to learn from these lessons. 

What we don’t want to do is get in the habit of repeating them. 

Mr. Fanning, if you don’t mind, I would like to start with you. 

The physical work of the restoration I know falls mainly on industries, but what role does the Federal Government play in this? 

210 

Mr. FANNING. Oh, they play an exceedingly important role. As I 

described earlier, when I think about the role of the ESCC, I describe it kind of in three levels. The first is to harmonize the efforts 

of the Federal Government. This is truly a public/private partnership, particularly in a super-regional kind of disaster where we absolutely—— 

Mr. MULLIN. When you talk about a private/private partnership—— 

Mr. FANNING. Right. 

Mr. MULLIN [continuing]. Does the partnership end when the 

Federal dollars are put in and, then, the utility companies reap the 

benefits of it? Or do the Federal dollars, since it is a partnership, 

get paid back? 

Mr. FANNING. Listen, the partnership exists whether there is a 

disaster or not. 

Mr. MULLIN. Sure. 

Mr. FANNING. This is our, what we call, playbook. 

Mr. MULLIN. Right. 

Mr. FANNING. This is our regime in which we respond to cyber, 

physical security, or natural disasters. And what it describes here 

is, frankly, not only the unity of effort, the ‘‘what’s’’ of a restoration 

effort, but also the unity of message and the ‘‘how’s’’ around a restoration effort. That has to be coordinated and harmonized between 

the Federal Government and not only electricity in this case, but, 

as we said before, the lifeline sectors. In cyberwarfare, it is going 

to be in the context of finance, telecom, electricity. Broadly, it 

would include transportation and water, and then, there are other 

priorities going from that. 

Don’t ever forget the need to harmonize, also, State and local 

government efforts, the boots on the ground that ultimately will 

impact our ability to deliver. 

Mr. MULLIN. So, when we are talking about a partnership, are 

we talking about just in financial support or, as you are describing, 

all the above from the logistics behind it, from the Federal Government stepping out and getting some of the red tape out, letting you 

guys go to work, getting some waivers in place? 

Mr. FANNING. Yes, Congressman, absolutely right. In fact, somebody else mentioned this National Infrastructure Advisory Council 

made a recommendation to the President to form something called 

a SICC, Strategic Infrastructure Coordinating Council, of electricity—— 

Mr. MULLIN. We have acronyms for everything around here. 

[Laughter.] 

Mr. FANNING. Yes. Yes, I know it. 

Electricity, finance, telecom. And what we will do is bring CEOs 

together, so me and others representing the electricity sector, finance, telecom, to put together a common set of regulatory permissions, legislative initiatives, harmonizing technology systems, information-sharing, and physical coordination. If we can get that done, 

that is an enormous activity. 

The other thing that I think we need to do is inform policymakers like you all. And that is why I applaud this effort. Because 

there is so much noise around these kinds of disasters or potential 

211 

disasters, we have to take action before they get here. If all we are 

doing is reacting to the latest disaster—— 

Mr. MULLIN. Thank you. 

Mr. FANNING [continuing]. We are way behind the ball. 

Mr. MULLIN. Yes. 

Mr. FANNING. We have got to pitch, not catch. 

Mr. MULLIN. No, I agree with that. But look at that; wasn’t that 

neat. You get a little zing in there for our chairman. Wow. That 

was thinking on your feet. 

[Laughter.] 

I agree with that. We would love to move to a point of being 

more proactive than reactive, and take the lessons learned. So, I 

actually applaud the idea of putting together that committee, so to 

say, where we can say, ‘‘Hey, look, this is our lessons. These are 

what we need. These are the roadblocks that need to be dropped. 

This is why it happens.’’ And let’s move forward, so we can react 

faster. 

Mr. FANNING. And, Congressman, I think it needs to be CEO-led. 

Eighty-seven percent of the critical infrastructure is owned by private industry. 

Mr. MULLIN. Right. 

Mr. FANNING. We have to work together. 

Mr. MULLIN. Mr. McBrayer, I have got just a short time here. 

The EPA issued several fuel waivers—— 

Mr. MCBRAYER. Yes. 

Mr. MULLIN [continuing]. Along the way for diesel and gasoline 

that maybe didn’t meet the standards, but was able to get delivered. Was it effective? Was that helpful? 

Mr. MCBRAYER. I think it was effective and helpful at the time. 

I think one of the things we have to adjust to as it relates to getting fuel to folks who are your constituents, our consumers, is that, 

at least in the Southeast, we are transitioning from summer-grade 

gasoline to winter-grade gasoline on September 15th every year. 

Because of the nature of the two specifications, winter-grade gasoline is less costly than summer-grade gasoline. So, whether your inventory is in your store or whether you are a placeholder for inventory in a terminal, the financial incentive is to diminish the 

amount of supply that you have going into September 15 and 16 

because you are going to take in many cases a 10-to-15-cent devaluation of that inventory, basically, at 12:01 a.m. on the 16th. 

One of the things I would ask from a Federal perspective is to 

take a look at that date. Is that really the only date that we can 

in the Southeast convert from the lower-RVP to the higher-RVP 

gasoline? Or is there a way to allow that date to move from time 

or time, or be fixed, so that folks like RaceTrac and other members 

of our association are not forced by the changing cost to diminish 

inventories in a time where hurricanes are more likely to occur? 

Mr. MULLIN. Thank you. That is a great point. 

And, Mr. Chairman, thank you for entertaining a little bit more 

time there. I yield back. 

Mr. OLSON. And seeing only Astros fans, but no further Members 

seeking to ask questions, I would like to thank all of our witnesses 

again for being here today. 

212 

1The information has been retained in committee files and also is available at http:// 

docs.house.gov/meetings/IF/IF03/20171102/106573/HHRG-115-IF03-20171102-SD003.pdf. 

I have a unanimous consent and our nine documents for the 

record. 

No. 1 is the PREPA letter to EEI and APPA. 

No. 2 is an APPA letter to the Energy and Commerce subcommittee on mutual aid. 

No. 3 is an APPA and EEI letter to Mr. Ricardo L. Ramos Rodriguez. 

No. 4 is a letter from a farmer to the Energy and Commerce’s 

Energy Subcommittee. 

No. 5 is the EIA supplemental testimony with attachments.1

No. 6, AdvaMed letter. 

No. 7, letter from the FDA. 

No. 8, GridWise Alliance document. 

No. 9, letter to Senators Murkowski and Cantwell from the 

former EPA official and Puerto Rico Energy Commissioner. 

Without objection, so ordered. 

[The information appears at the conclusion of the hearing.] 

Mr. RUSH. Mr. Chairman, I want to restate or reiterate my request that PREPA be subpoenaed and that we have FEMA before 

this subcommittee in the near future. 

Mr. OLSON. As I told my friend, I will carry that message to 

Chairman Upton and Chairman Walden. 

Pursuant to committee rules, I will remind members that they 

have 10 business days to submit additional questions for the 

record. As to the witnesses, submit their response in 10 business 

days upon receipt of those questions. 

And one final comment, a point of personal privilege. You guys 

have, it looks like, 231⁄2 hours to get to Houston for our big parade 

for our Astros. 

[Laughter.] 

Without objection, the subcommittee is adjourned. 

[Whereupon, at 2:31 p.m., the subcommittee was adjourned.] 

[Material submitted for inclusion in the record follows:] 

213 


Government of Puerto Rico 

Puerto Rico Electric Power Authority 

October 31, 2017 

Mrs. Sue Kelly, President and CEO 

American Public Power Association 

2451 Crystal Drive, Suite 1000 

Arlington, VA 22202, USA 

Mr. Tom Kuhn, President 

Edison Electric Institute 

701 Pennsylvania Avenue1 N.W. 

Washington, D.C. 20004-2696 

Dear Sue and Tom: 

Due to the catastrophic destruction to our electrical infrastructure following hurricanes Irma and Marla, 

1 urgently request your assistance in restoring the electrical infrastructure of the Puerto Rico Electric 

Power Authority (PREPA). 

We know the American Public Power Association and the Edison Electric Institute have relationships 

across the electricity sector on the mainland and request your assistance in bringing resources to Puerto 

Rico to support power restoration on the island. We also understand that you have relationships with 

key Federal and state government partners that can help expedite these requests. 

It is our expectation that crews and resources will be required as soon as possible and ending at a date 

yet to be determined. 

Due to the design similarities of our systems and recent experience in undertaking large scale 

restoration following Superstorm Sandy, we would initially request assistance from New York State 

public and private utilities, but understand that the scope of damage and need for certain ~xpertise 

could require additional support from electric companies from across the United States. Public and 

private utilities from Florida are also available and can mobilize quickly due to distance and 

transportation logistics between Florida and Puerto Rico. 

While our requests will likely grow as crews are brought in to work on our system and better 

assessments of the damage are conducted, at this juncture we are requesting: 

Chief Executive Officer 

Q 787.521.4666 

8 787.521.4661'1 
214 


Mrs. Sue Kelly 

Mr. Tom Kuhn 

Page 2 

1. 600 full time equivalent transmission and distribution line workers and associated equipment, 

including a minimum of S helicopters (3 heavy Jlfting and 2 light for crew transfer to 

transmission towers), required to support their work in restoring the transmission and 

distribution systems; and, 

2. Management, supervisory, and administrative support with regards to the coordination of the 

restoration efforts, including, but not limited to: incident command, logistics, housing, 

transport, and supply chain staff and support. 

Bear in mind that extensive portions of the transmission lines in Puerto Rico run through rugged 

mountainous terrain with little or no road access. Also, that there are subcontracted crews in Puerto 

Rico, including APPA members, that already have mobilized men and heavy equipment, have become 

familiar with PREP A's operations and may be at your disposal creating minimal delays in restoration 

work. We anticlpate that due to the duration of the assistance required to repair the damaged 

infrastructure, additional support may be required once additional specifications, requirements, and 

logistics are determined. 

Please confirm back to me your willingness to participate in the effort along with an appointed designee 

with whom we can work with to make immediate progress in addressing this request. 

Chief Executive Officer 

CC: 

Mr. Thomas P. Bossert, Assistant to the President for Homeland Security and Counterterrorism 

Lieutenant General Todd T. Semonite, United States Army Corps of Engineers 

Mr. Dan Brouillette, Deputy Secretary, United States Department of Energy 

Mr. Christopher C. Krebs, Senior Official Performing the Duties of the Under Secretary for the 

National Protection and Programs Directorate 

Mr. Brock Long, Administrator, Federal Emergency Management Agency 
215 


AMERICAN 

ASSOCIATION 

November 1, 20 17 

The Honorable Fred Upton 

Chairman 

House Energy & Commerce Committee 

Subcommittee on Energy 

2183 Rayburn House Office Bldg. 

Washington, D.C. 20515 

Dear Chairman Upton and Ranking Member Rush: 

The Honorable Bobby Rush 

Ranking Member 

House Energy & Commerce Committee 

Subcommittee on Energy 

2188 Rayburn House Office Bldg. 

Washington, D.C. 20515 

On behalf of the American Public Power Association (APPA or Association), I am writing to express 

our appreciation for the House Energy & Commerce Committee's Subcommittee on Energy holding a 

hearing to examine emergency response and energy infrastructure recovery efforts during the 2017 

hurricane season. APPA is the national service organization representing the interests of over 2,000 

community-owned, not-for-profit electric utilities. These utilities include state public power agencies, 

municipal electric utilities, and special utility districts that provide low-cost, reliable electricity and other 

services to over 49 million Americans. 

APPA, along with the Edison Electric Institute (EEl) and National Rural Electric Cooperative 

Association, participates in the Electricity Subsector Coordinating Council (ESCC), a public/private 

partnership outlined in the National infrastructure Protection Plan for critical infrastructure owners and 

operators. It serves as the electricity sector's principal liaison with the government on policy-level 

security issues and engages regularly with its federal government counterparts, including senior 

Administration officials from the White House, Department of Energy (DOE), Department of Homeland 

Security, Federal Energy Regulatory Commission, Federal Bureau of Investigation, and others. Tom 

Fanning, Chairman, President, and CEO of Southern Company, is a co-chair of the ESCC and is 

testifying before the subcommittee on behalf of the ESCC. APPA snpports his testimony. 

Hurricanes Harvey, Irma, and Maria caused widespread damage and impacted millions of Americans 

throughout the South and in the Caribbean. Public power utilities and their customers were impacted by 

all three storms, but particularly by Hurricanes Irma and Maria. Hurricane Irma caused widespread 

damage to the islands of St. Thomas and St. John in the U.S. Virgin Islands (US VI) and Key West, 

Florida. All 63 counties of Florida and large parts of Georgia, as well as Puerto Rico, were also impacted 

the storm. Irma was soon followed by Hurricane Maria, which caused significant damage to St. Croix in 

US VI and Puerto Rico. Mutual aid played an important role in helping restore power to many impacted 

communities and is ongoing in the efforts to restore power to USV!. 
216 


House Energy & Commerce Committee 

Page 2 

November I, 2017 

In the aftermath of these devastating storms, APPA has received a lot of questions about mutual aid. 

Common questions include what is it? How does it work? How is it invoked? Who pays for it? Given 

the many questions we have received, we thought it would be helpful to provide an overview on the 

mutual aid process. 

Mutual aid is when utilities help one another in times of need. The Association, together with state 

and regional public power utilities and organizations, coordinate the mutual aid network for the nation's 

public power utilities. More than I, I 00 utilities across the country participate. Utilities that want to give 

and get help for power restoration after a disaster sign up for this network. The network also maintains a 

list of independent contractors that can be called upon when extra help is needed. 

When (and even before) a major disaster hits a utility's service territory and the utility knows that its 

own crews and equipment will not be enough to restore power quickly, it calls for mutual aid. It provides 

its best estimates of how many people it needs and what type of skills they should have. The utility also 

specifies equipment and materials needs. Other utilities in the network respond with what they can offer. 

The actual dispatch and movement of crews from different utilities is coordinated by utility and 

public power association personnel who volunteer as regional and national mutual aid coordinators. Such 

efforts require substantial logistics management. The utility that is requesting mutual aid generally 

arranges to house, feed, and care for the crews that come in from other utilities, and provides them the 

necessary work/safety briefings to do their jobs effectively. Requesting utilities generally send their own 

employees out to support visiting crews. 

Typically, a public power utility requesting assistance pays other utilities that send help. Rates are 

determined through agreements entered into by the utilities. As units of state and local government, 

public power utilities are eligible for partial reimbursement of restoration expenses by the Federal 

Emergency Management Agency (FEMA), if all relevant conditions and requirements are met. 

In addition to helping public power utilities in need, public power utilities also provide mutual aid to 

cooperatives and investor-owned utilities when requested and have also received assistance from 

cooperatives and lOUs when needed. In the aftermath of Superstorm Sandy, the entire industry has 

worked more closely on restoration efforts with the goal of bringing back power to all customers as soon 

as possible. Mr. Fanning's testimony discusses some of the industry's efforts to improve coordination not 

just within the industry, bllt with our federal government partners. 

When Hurricane Harvey hit the Gulf Coast in September, most public power utilities were spared the 

worst, but did provide mutual aid to others directly impacted by the storm. Approximately 160,000 

public power customers in Texas lost power and service was restored to nearly all of them within three 

days. Robstown, Texas, which is near Corpus Christi, suffered wind damage, but restored power to 95 

percent of its customers within two days. Some public power utilities in East Texas lost power due to 

transmission outages in the area, but their distribution systems did not incur substantial damage. Walt 

Baum, the Executive Director of the Texas Public Power Association, an APPA member, testified before 
217 


House Energy & Commerce Committee 

Page 3 

November 1, 2017 

the House Science, Space, & Technology Committee on October 3, 2017, on recovery efforts in Texas 

after Hurricane Harvey and the industry's efforts to maintain a reliable and resilient grid, including the 

importance of mutual aid to resiliency. I encourage the Energy Subcommittee to review Mr. Baum's 

insightful testimony to the Science Committee, which is available here 

Hurricane Irma impacted public power utilities in US VI, Puerto Rico, Florida, and Georgia. The 

hurricane inflicted significant damage to the islands of St. Thomas and St. John in USVL Julio Rhymer, 

the Executive Director of Virgin Islands Water and Power Authority (US VI WAPA) is testifying at the 

hearing and his testimony describes the terrible impact Irma, and then Maria, has had on the residents of 

US VI, knocking out power everywhere. USVI WAPA requested mutual aid after Irma and public power 

utilities from New England have sent down crews to assist in the recovery efforts. Given the extensive 

damage done by the hurricane, US VI has requested additional mutual aid through APPA. We are 

working with other public power utilities. as well as Western Area Power Administration and contractor 

crews to assist US VI W APA in its recovery efforts. 

Puerto Rico was also hit by Irma, knocking out power to much of the island. The Puerto Rico 

Electric Power Authority (PREP A), an APPA member, had restored power to most of its customers 

before being devastated by Hurricane Maria just over a week later. 

APPA member Keys Energy Services in Key West, Florida, was directly hit by Hurricane Irma, 

which took down most of its distribution and transmission facilities. As the storm moved up through 

Florida, it impacted every single public power utility in the state. More than 800,000 public power 

customers in Florida were without power at the height of the outages, but 98 percent of them had their 

power restored within seven days. In addition, there were significant outages among some of our Georgia 

members. 

Mutual aid played a key role in restoring the power quickly in Florida and Georgia. Public power 

utilities aided one another in the restoration efforts. They also aided IOUs and were aided by IOUs to 

restore power. The Florida Municipal Electric Association, an APPA member, played a central role in 

coordinating mutual aid for the utilities impacted by the hurricane in the state. As Mr. Fanning notes in 

his testimony, "this was one of the largest restoration efforts in U.S. history" and the speed of the 

recovery was acknowledged by the U.S. Energy Information Administration. 

Hurricane Maria knocked out power to St. Croix in US VI, the one island not substantially impacted 

by Hurricane Irma, and all of Puerto Rico. APPA member New York Power Authority (NYPA) sent 

technical subject matter experts and drones down to Puerto Rico as part of a state-led mission initiated by 

New York Governor Andrew Cuomo, at the request of Puerto Rico Governor Ricardo Rossello. NYPA's 

personnel worked with PREP A on damage assessments of specific PREP A generation, transmission. and 

substation facilities. 

In addition, FEMA, the U.S. Army Corps of Engineers (USACE), and DOE have personnel on the 

ground. In early October, FEMA put USACE in charge of the mission to restore power. USACE has 
218 


House Energy & Commerce Committee 

Page 4 

November 1, 2017 

selected contractors to assist in the recovery efforts and is testifying at the hearing on its efforts. Four 

public power utilities from Florida are currently in Puerto Rico assisting in the recovery efforts as 

subcontractors. On October 31, 2017, PREP A requested mutual aid from APPA and EEl. The 

Association is pleased to have received this request and will work with PREP A, our government partners 

and their contractors, and the industry to support the ongoing power restoration process. 

APPA appreciates the opportunity to submit this letter to the Energy Subcommittee and provide 

background on the mutual aid process for public power utilities. Thank you for holding this important 

hearing on emergency response and energy infrastructure recovery efforts during the 2017 hurricane 

season. 

Sincerely, 

Susan N. Kelly 

President & CEO 

S'NKIDW 

cc: The Honorable Greg Walden 

The Honorable Frank Pallone 
219 


October 31, 2017 

Mr. Ricardo L Ramos Rodriguez 

Chief Executive Officer 

Government of Puerto Rico 

Puerto Rico Electric Power Authority 

G. P.O. Box 364267 

San Juan, Puerto Rico 00936-4267 

Dear Ricardo: 

We received your letter this morning requesting additional support for power restoration in Puerto Rico. 

We now are working together and with our member companies throughout the industry to support this 

request. We look forward to working with you and with our government partners and their contractors 

to bring crews, equipment, material, and technical experts to the island to restore power for the people 

of Puerto Rico. 

As you noted, Hurricane Maria caused historic damage to the Commonwealth's infrastructure, and there 

are considerable logistical challenges that wilt complicate the power restoration effort. While this will 

not be a typical restoration process, we are fully committed to overcoming those challenges and to 

bringing our experience and resources to Puerto Rico. 

We have designated Scott Aaronson, Executive Director for Security and Preparedness at the Edison 

Electric Institute, and Mike Hyland, Senior Vice President for Engineering Services at the American Public 

Power Association, to be your points of contact for coordinating with the electric power industry on the 

mainland United States. 

Thank you again for reaching out. We share your sense of urgency and look forward to working with you 

on the restoration mission. Please do not hesitate to contact us if we can provide any additional 

assistance to you or our fellow citizens in Puerto Rico. 

Sincerely, 

American Public Power Association 

Tom Kuhn 

President 

Edison Electric Institute 
220 


November 1, 2017 

The Honorable Fred Upton 

Chairman 

Subcommittee on Energy 

Committee on Energy and Commerce 

United States House of Representatives 

Washington, DC 20S15 

Dear Chairman Upton and Ranking Member Rush: 

Stephen J. Ubi President & Chief Executive Officer 

The Honorable Bobby Rush 

Ranking Member 

Subcommittee on Energy 

Committee on Energy and Commerce 

United States House of Representatives 

Washington, DC 20S15 

On behalf of our members, PhRMA wants to thank you for convening the November 2, 2017, 

hearing on "The 2017 Hurricane Season: A Review of Emergency Response and Energy 

Infrastructure Recovery Efforts." We appreciate your consideration of this important issue 

and want to provide additional information as you focus on the recovery efforts in Puerto 

Rico after two recent hurricanes- most notably Hurricane Maria- struck the island this 

season. Specifically, we want to provide information about how our members with 

manufacturing or other interests there are managing with the devastation and highlight 

areas where additional assistance would aid in returning Puerto Rico's manufacturing base 

to full capacity and maintain that base in the longer term. 

While our members have a substantial manufacturing presence on the island, our industry 

recognizes that we are just one of many entities adversely impacted by these Hurricanes 

and that the situation on the ground is extremely challenging for many families and 

businesses. To help address these challenges, our members are working with government 

at every level and private stakeholders to help coordinate relief on the ground and to 

provide people impacted by the disaster with access to medicines, potable water and other 

necessary supplies. PhRMA and many of our members are also working closely with 

Healthcare Ready, an independent relief organization we helped establish which 

coordinates the delivery of medicines and other healthcare resources to people impacted 

by natural disasters. 

These hurricanes have also had an adverse impact on our manufacturing facilities and the 

welfare of many of our employees in Puerto Rico. We are working in close coordination 

with federal, commonwealth, and local agencies to restore our facilities to 100 percent 

capacity, and we are making good progress. 

950 NVV, 300 V¥f\SHINCTON. DC 7000~ 202·835-3584 , PhRMA.org 
221 


The Honorable Fred Upton 

The Honorable Bobby Rush 

November 1, 2017 

Page 2 of 3 

With respect to the medicines we manufacture, supply is generally stable. More importantly, 

we believe that these supplies will be sufficient to meet the short term needs of patients and 

the health care community. This determination is based on the contingency planning that our 

member companies have undertaken, the ability of our member companies to shift 

production to other manufacturing locations and the reserve supplies of medicines they 

maintain. 

We have particularly appreciated the leadership of Commissioner Scott Gottlieb, United 

States Food and Drug Administration (FDA) and the collaborative efforts of FDA's Drug 

Shortage Team and Emergency Operations Center. FDA has shared information with our 

members and displayed great willingness to discuss alternatives to assure continued product 

supply. However, if services, especially electricity, are not restored in the near future, the 

supply situation could worsen. 

To further this progress, we thought it would be helpful to share with you some discrete areas 

where additional assistance could accelerate the restoration of our members' manufacturing 

capabilities to full capacity. These areas include: 

Restoring the Power Supply and the Electrical Grid 

• This is a critical issue as generators have run for prolonged periods, and reliance on 

generators for manufacturing operations is suboptimal. The dearth of available skilled 

electrical technicians and generator service technicians exacerbates the issue. 

• Resumption of electrical power would also help decrease employee absenteeism and 

restore normalcy to employees' lives. 

Returning Employees to Work Safely 

• Food security and facilitating the resupply of groceries would help employees return 

to work safe and healthy. Economic aid would support the local population and 

ensure a stable social environment. 

• Restoration of roads and road lighting would allow employees to travel safely during 

daytime and at night and facilitate resumption of around-the-clock manufacturing 

operations. 

Restoring Municipal Water and Waste Water Systems 

• Ensuring that water can be reliably and safely sourced, and that waste water can be 

treated, would enable employees to resume more healthy living conditions and would 

help our industry restore manufacturing to full capacity. 
222 


The Honorable Fred Upton 

The Honorable Bobby Rush 

November 1, 2017 

Page 3 of 3 

Facilitating Efficient Transportation 

• Alleviating congestion and blockages on roads and at port terminals would facilitate 

the transportation of goods and materials on and off the island. 

• Adequate fuel supplies would help ensure generator power is maintained (until 

electrical power is fully restored) and that vehicles on the island are able to transport 

supplies and employees. 

Restoring Telecommunications, Cellular and Internet Service 

• Limitations on service restrict communications between and among companies' 

multiple plants on Puerto Rico and their ability to coordinate with employees and 

government agencies. 

Sincerely, 
223 


AdvaMed 

Advanced Medical Technology Association 

November 2, 2017 

The Honorable Fred Upton 

Chairman, Subcommittee on Energy 

Committee on Energy and Commerce 

U.S. House 

Washington, 

The Honorable Bobby Rush 

Ranking Member, Subcommittee on Energy 

Committee on Energy and Commerce 

U.S. House of Representatives 

Washington, D.C. 20515 

RE: November 2, 2017 Hearing, Tile 2017 Hurricane Season: A Review of Emergmcy Response and 

Energy Infrastructure Recoveo• Efforts 

Dear Subcommittee Chairman Upton and Subcommittee Ranking Member Rush: 

On behalf of the over 300 manufacturers of medical 

Advanced Medical 

restoring electricity to device manufactttring 

sh011ages of life saving and life sustaining medical 

devices and diagnostics that AdvaMed (the 

commend you for holding this hearing. 

the thousands of employees of medical 

to return to !hi! As you 

that you stress importance of 

critical suppliers to prevent supply 

AdvaMed alone more than 20 medical technology with over 30 manufacturing 

facilities in Puerto that account for over on the Their help patients 

worldwide Jive longer, healthier, and more lives and include care products, 

critical care, orthopedic, and neurological devices, along with advanced cancer 

diagnostics 

As you may know, we have been 

Puerto Rico following the devastation 

HHS, and FEMA. 

efforts continue in 

efforts of FDA, 

The appropriate of electrical infrastructure repairs to bring medical device manufacturers 

back onto the is essential to little disruption as possible to patient care worldwide. As the 

delivery technology role in the entire health care we would be grateful 

for any assistance you could in prioritizing these facilities as recovery 

plans are developed and implemented. 

As recovery efforts continue across the island, the companies we 

and the economy of Puerto Rico. Please do not hesitate to let me 

capacity in your elf om moving forward. 

President & CEO 

AdvaMed 

Bringing innovation to patient cam worldwlde 

are committed to the people 

if we may be of service in any 
224 


/ .. /-.. , .. , 

' ' 

,,_ 

The Honorable Fred Upton 

Chairman 

Subcommittee on Energy and Power 

U.S. House of Representatives 

2183 Rayburn House Office Building 

Washington, DC 20515 

The Honorable Greg Walden 

Chairman 

Energy and Commerce Committee 

U.S. House of Representatives 

2125 Rayburn House Office Building 

Washington, DC 20515 

Dear Chairmen Upton and Walden and 

November 2, 2017 

The Honorable Bobby L. Rush 

Ranking Member 

Subcommittee on Energy and Power 

u.s. 

The Honorable Frank Pallone, Jr. 

Ranking Member 

and Commerce Committee 

u.s. 

2322A Rayburn Office Building 

wasnm~~ton, DC 20515 

Members Rush and Pallone: 

The Food and Drug Administration (FDA) greatly appreciates 

Committee's attention to the 2017 hurricane season 

following Hurricane Maria. I the om1ortunitv 

Subcommittee on Oversight 

Preparedness for and Response to the 

Thank you for your continued commitment to the recovery of Puerto Rico and your support of 

FDA's efforts to advance these shared goals. 

Medical manufacturing is a critical pa1t of the Puerto Rican economy. There are more 

than 80 r.vn.-, ""' medical product manufacturers across the island. This industrial base is 

and economic for the island and it is a key to Puerto Rico's 

economic recovery. manu:faclturing facilities are also a pivotal source of critical medical 

products for the entire United States. 8 percent of all pharmaceuticals used in the United 

States are manufactured in Puerto Rico. sophisticated and critical medical devices are also 

manufactured on the island. Helping to hring resources back in operation is an important 

goal for FDA and for Puerto Rico. 

After Hurricane Maria, l visited Puerto Rico and the FDA nc<<u1Juw:u:n> 

the Governor of Puerto Rico, Ricardo Rossello, to discuss 

product facilities fully back to operation to help Puerto Rico and to 

U.S. Food & D'ug Administration 

10903 New Hampshire Avenue 

Silver Spring, MD 20993 
225 


important medical products made on the island. Since my visit, I have continued to stay in touch 

with the Governor's team as we advance these efforts. 

We are actively working every day to engage with companies to ensure continued operations on 

the island. Companies are functioning at different levels based on the damage done by Hurricane 

Maria and on their generator capacity. We are keeping a close watch on the most critical 

medical products that are at the highest risk for shortage. In urgent cases, when critical products 

are at issue, we have intervened with government partners such as the Federal Emergency 

Management Agency and the Department of Homeland Security to help secure fuel to maintain 

production lines and get clearance to move logistical support onto the island and finished goods 

to their intended recipients. We are communicating with the firms and, in some cases, are in 

daily contact with them to help them manage the evolving challenges. We are prepared to act 

quickly to help prevent drug and device shortages. 

The Subcommittee's hearing "The 2017 Hurricane Season: A Review of Emergency Response 

and Energy Infrastructure Recovery Efforts" is examining a critical component of Puerto Rico's 

recovery. We share the goal of restoring the island's electrical grid. Restoring the grid is 

imperative for public health because of the significant medical manufacturing performed in 

Puerto Rico. To date, FDA has been working on a case-by-case basis with federal and local 

government partners to provide logistical support and fuel to drug and device companies to 

enable them to continue operations. Our next priority is to ensure manufacturers get back to 

stable production as soon as possible to ensure supply of critical products to patients across the 

United States. Our experts will be working closely with local and federal partners to prioritize a 

small subset of critical facilities-plants that manufacture medically important products that are 

sourced primarily or only in Puerto Rico-for consideration for earlier access to the rebuilt grid. 

Most facilities can only engage partial production on generators. Over time, and for a subset of 

facilities, our work to avert shortages might entail helping them to get back closer to full 

production. 

Thank you again for the opportunity to testify before your committee. Best wishes for a 

successful hearing, and please Jet me know if I can be of assistance on this or any other issue. 
226 


Written Testimony for the Record 

Submitted by the GridWise Alliance1 

Energy Subcommittee of the House Energy & Commerce Committee 

"The 2017 Hurricane Season: A Review of Emergency Response and Energy 

Infrastructure Recovery Efforts" Hearing 

November 2, 2017 

Background: 

Current disaster relieflaw generally requires rebuilding or replacing damaged infrastructure with 

"like" (i.e., similar) infrastructure in most cases, though it can be rebuilt "to code." However, as 

we have witnessed, neither the status quo, nor building to code, are anticipated to be sufficient to 

withstand projected future extreme weather events. Recurrence of destruction in future storms 

could be extremely costly tens of billions of dollars (at least, potentially), as we are seeing 

now. 

In the wake of Hurricanes Harvey and Irma, Texas and Florida were able to re-energize their 

power grids significantly faster than in previous hurricanes (further data are provided below). 

These quicker recoveries were due, in no small part to, to grid modernization investments by 

local utilities. 

Thus, steps should be taken now to rebuild infrastructure in a manner that increases system 

resilience, reliability, and security to reduce the scale of damage and destruction and the speed of 

power restoration in the future. In other words, this is why some changes in law are needed to 

enhance flexibility to enable the electric system to be rebuilt in a more resilient and "smarter" 

manner. 

In addition to the transmission and distribution lines, the generation in Puerto Rico is (or was) 

vulnerable because it is situated near the coast to take advantage of cooling water. 

1 The GridWise Alliance consists of electric utilities, information technology and telecommunications equipment 

and service providers, National Laboratories, Regional Transmission Organizations (RTOs)llndepcndent System 

Operators (ISOs), and academic institutions. This testimony does not represent the views of all Grid Wise members. 
227 


Key Messages: 

• Consideration should be given to repairing and/or rebuilding in the short- and longer-term 

in a more resilient, "smarter" manner- where it makes sense to do so, as elaborated on 

below. 

• Flexibility in current law is needed to enable this approach of near-term and longerterm rebuilding in a more resilient, "smarter" manner to occur. 

• A number of process and coordination-related steps also need to be addressed. 

• A holistic systems planning approach is needed. Planning at least can be started in 

parallel with immediate restoration of power, at least to major portions of populations in 

Puerto Rico and the U.S. Virgin Islands. 

o More specifically, a damage assessment can be done, likely fairly quickly, as can 

some immediate power restoration efforts. 

o These steps can occur along with planning for, and implementing, some near-term 

solutions that could be more resilient and "smarter," as well as a longer-term, phased 

approach toward developing and re-building a more resilient, sustainable electric 

system. which will take time to completely rebuild. 

o System planning can be iterative and can be updated along the way. 

o Different approaches might be appropriate for different parts of the islands. 

o Cost-effectiveness should be ensured over the long term or project lifetime. 

o Public-private partnerships should be leveraged for the recovery effort, where 

appropriate. 

• Focusing on the desired outcomes or ob,jectives is important: i.e., to create a resilient, 

reliable, and secure system design. 

o Thus, picking specific technological or other solutions likely should be avoided, 

especially on an ad hoc basis- again, focusing outcomes or objectives. 

o Planners and engineers should aim to design a system that meets resiliency, cost, and 

other metrics and, in doing so. utilize the best mix of technologies and capabilities for 

the intended outcomes. Options for technologies and capabilities that are available to 

achieve such outcomes include but are not limited to: outage detection and 

management systems (e.g., smart meters), those that enable ·'islanding" of portions of 

the grid, microgrids, distributed energy resources, and energy storage (e.g., flywheels, 

batteries), and digital and flood-resistant substations. 

• Many critical infrastructure systems and sectors have interdependencies, so there is a 

need to look holistically at systems and across critical infrastructure sectors. For 

instance, planners should consider coordinating, including co-locating (or optimizing 

other synergies), between and among multiple infrastructures/sectors, e.g., 

telecommunications, electricity, and water infrastructure. 

2 
228 


Having checks and balances in place, as well as transparency, and 

reporting/metrics/accountability for funding also are recommended, where appropriate. 

Examples of Rebuilding in a More Resilient, "Smarter" Manner: 

• Wooden poles could be replaced with concrete or steel ones. 

A transmission line, or portion of a line, could be repaired to help restore power. Then, 

the line could be made more resilient, e.g., by creating redundancies or hardening. After 

these steps occur, the original line could be replaced or upgraded, if necessary. 

• A variety of resources, such as solar, batteries, microgrids, and/or diesel could be used to 

help restore power in certain parts of the island and/or to critical facilities relatively 

quickly. These systems could later be upgraded to provide more permanent grid support. 

Given the current location of generation sources, some type of reliable generation with 

adequate "fuel supply" near critical loads, such as hospitals, likely should he part of the 

overall resiliency planning considerations. 

lnjiJrmation about Restoration in the Wake of Hurricane Irma: 

FPL: 

• Hurricane Irma ''impacted all 35 counties and 27,000 square miles of FPL service 

territory, causing more than 4.4 million customers [(i.e., 90 percent of the company's 

customers)] to lose powcr."2 

• To prepare, "FPL assembled and pre-positioned the largest restoration workforce in U.S. 

history, which grew to approximately 28,000 at its peak."3 

• "This preparation and coordinated response, combined with [$3 billion in] hardening and 

automation investments that FPL has made since 2006 to build a stronger. smarter and 

more storm-resilient energy grid, enabled the company to restore service to over 2 

million customers in 1 day''- i.e., to restore nearly 50 percent of the outages.4 

(Emphasis added) This is an "80% improvement compared to [Hurricane] Wilma 

restoration etTorts.''5 

2 Edited Transcript ofl'\:extEra Energy, Inc. earnings conference call or presentation, text version of transcript, 

October 26, 2017 ( 1:00 p.m. GMT). available at: https://finance.yahoo.com/ncwsiedited-transcript-nee·earningsconference-122613065.html0.tsrc~applewf. 

3 Next Era Energy, Inc. and NextEra Energy Partners, LP, Third Quarter 2017 Release, October 26,2017, available 

at: http:iiwww.investor.nexteraenergy.comiphoenix.zhtml?c~88486&p-EarningsRelease. 

4 Edited Transcript ofNextEra Energy, Inc. earnings conference call or presentation, text version of transcript, 

October 26, 2017 ( l :00 p.m. GMT), available at: https:i!finance.yahoo.comh1ewsiedited-transcript-nee-earningsconferencc-l22613065.html?.tsrc~applewf. 

5 Edited Transcript ofNextEra Energy, Inc. earnings conference call or presentation, text version of transcript. 

October 26, 2017 (I :00 p.m. GMT), available at: https:litinance.yahoo.com/news/editcd-transcript-nec-earningsconference-122613065.html?.tsrc~applewf. 
229 


''Within three days, 75 percent of FPL customers were restored and within five days, 90 

percent of customers were back on."6 The "full restoration was completed I 0 days after 

Hurricane Irma left FPL's service territory."7 

• FPL "completed the fastest storm restoration of the largest number of customers by any 

one utility in U.S. history." 8 

• "Hurricane Irma had an approximately 50% higher damage potential than Hurricane 

Wilma'' and 15% more of the population (90% in Irma versus 75% in Wilma) lost power 

during lrma.9 Yet, ''there was an approximately 80% reduction to pole damage and an 

80% improvement in the time to energize all substations following the storm when 

compared to Hurricane Wilma." Moreover, "while the average customer outage from 

Hurricane Wilma lasted for over 5 days, the average outage for customers affected by 

Hurricane Irma was roughly 2 days, a 60% improvement." 10 

• ·'The total GDP within [FPL's] service territory averages over $1 billion per day. By 

reducing the average customer outage by more than 3 days when compared to Wilma," 

the "avoided economic loss to the state has more than paid for the $3 billion in hardening 

investments ... made since 2006." 11 

• Final storm costs arc preliminarily estimated to be "approximately $1.3 billion." 12 

6 Von Ancken, Erik, ''fPL shares lessons learned after Hurricane Irma knocked out power statewide,'' Orlando.com, 

October 17, 2017, available at: https:l/www.clickorlando.com/news/lessons-learned-for-fpl·after-irma. 7 Next Era Energy, Inc. and NextEra Energy Partners, LP. Third Quarter 2017 Release, October 26, 2017, available 

at: http://www.investor.nexteraenergv.com/phocnix.zhtrnl?c=88486&p=EarningsRelease. 

"NextEra Energy, Inc. and :-JextEra Energy Partners, LP, Third Quarter 2017 Release, October 26. 2017, available 

at: http://www.investor.nexteraenergy.com/phoenix.zhtml?c~88486&p=EarningsRelease. 

9 Edited Transcript ofNcxtEra Energy, Inc. earnings conference call or presentation, text version of transcript, 

October 26, 2017 (I :00 p.m. GMT), available at: https:i/finanee.yahoo.com/ncws/edited-transcript-nee-earningsconference-122613065.html".tsrc=applewf. 

10 Ibid. 

"Ibid. 

"Ibid. 

4 
230 


October 31,2017 

The Honorable Lisa Murkowski, Chair 

United State Senate Committee on Energy and Natural Resources 

Washington, DC 20510-6150 

The Honorable Maria Cantwell, Ranking Member 

United State Senate Committee on Energy and Natural Resources 

511 Hart Senate Office Building 

Washington, DC 20510 

Dear Senator Murkowski and Senator Cantwell: 

Hurricanes Irma and Maria took a catastrophic toll on Puerto Rico's electricity system, affecting critical 

facilities and basic municipal, business, and residential functions. The hurricanes also caused significant 

damage to the electric grid's transmission and distribution assets. Two thirds of the island is still without 

power and has been without power for 50 days, while peak loads are currently reaching approximately 

I 0% of pre-hurricane levels. Many key businesses and residents have begun fleeing the island. Without 

electricity, the island's water and sewage systems and cell towers remain inactive. If the grid stays offline, 

a large number of people will continue to be at risk of serious illness from heatstroke, dehydration, or 

exposure to contaminated water. 

We are writing to you as former government officials who are extremely concerned about rapidly 

deteriorating conditions in the territory of Puerto Rico. We appreciate your October 26, 2017 letter to 

Senator Mitch McConnell and Senator Charles Schumer, but want to provide additional information as 

you review this issue and strongly urge you to take immediate action to direct all federal agencies to 

change course and rebuild the electricity grid based on energy efficiency, resiliency, decentralization and 

renewable energy. It is expected that Congress will act in the coming weeks on another budget 

supplemental hurricane bill. That legislation should direct federal agencies to change what they are 

currently doing in Puerto Rico, and also the US Virgin Islands, in rebuilding the electrical grid. We fear 

that federal dollars are being used tore construct the previous unreliable, expensive and dirty electricity 

grid that existed prior to the hurricanes. This makes little environmental sense and even less fiscal sense. 

Unless Congress intervenes and provides new direction to FEMA and other agencies, they will fund rebuilding the old electricity grid, and that grid will come down during the next hurricane as it did during 

Irma and Maria. 

Here is an op-ed that we co-authored on this issue on October 27,2017. 

While 873 of 1,100 gas stations are open and the supply of diesel fuels to hospitals and other critical 

facilities has improved; the road to recovery will be long. The Governor has set a goal for 95% restoration 

by December 15", however this is likely to be difficult as the U.S. Army Corps of Engineers estimates a 

full year for complete power restoration. Required repairs includes putting 62,000 distribution poles back 

up and the trucks needed to do so are in short supply. The head of the electric utility, PREP A (the largest 

public utility in the United States), estimates repairs will cost $5 billion, with other estimates far higher. 

Today, many workers from Puerto Rico and across the United States are working to rebuild the grid, 

funded in part by FEMA. However, under the constraints of the Stafford Act, these crews are rebuilding 

the grid 'as was'. And with many inexperienced workers, the quality of grid reconstruction may suffer. 

This process will return the island to an electricity system to using antiquated generation located far from 

the population centers, fragile transmission and distribution lines, and limited technological upgrades 

-which leaves Puerto Ricans paying more, getting less, and still exposed to hurricanes. 
231 


Even if Puerto Rico's electric grid is returned to pre-hurricane status- it would not be considered reliable, 

resilient, or cost-effective. PREP A targets have a monthly system average interruption frequency index of 

0.33, or an expectation that on average, a customer will have four outages per year. However, historically 

PREP A customers experience 11.5 outages per year on average. Outage duration was also high. When 

outages occurred, the average outage was over two hours long. Puerto Ricans experience four to five 

times the number of service outages as U.S. customers on average, despite the fact that they pay the 

second highest rates (over 20¢/kWh) in the U.S. after Hawaii, driven higher by expensive imported 

bunker fuel. 

The system's low reliability could in part be explained by the fact that PREP A hasn't performed major 

upgrades to its grid in decades, and the median age of the island's power plants at 44 years-more than 

double the industry standard of 18 years. It's hard to find replacement parts when individual pieces of 

equipment break down. 

The pre-hurricane system also faced the problem of overcapacity. A recession starting in 2007 combined 

with an 11 percent decline in population to produce a 19 percent decrease in electricity consumption and a 

14 percent decrease in peak load since 2004. With the rebuild of the grid taking months, one report 

suggests 500,000 people could leave the island for good as a result of the hurricanes, potentially leading 

to a future rate spiral burdening those who remain with even higher costs for electricity. 

Puerto Rico has an opportunity to rebuild quickly, and in a manner that supports the people's energy 

priorities: a resilient, cost-effective, de-centralized and sustainable grid. Even before the 2017 hurricanes, 

the island could have provided a significant fraction of its electricity with renewables at a net cost 

savings. Best-in-class power purchase agreement (PPA) offers for solar and wind- on the order of 10-

15¢/kWh will be lower than bunker fuel costs, even if damaged generators are replaced by higherefficiency units. Renewable energy and energy efficiency would mitigate the macroeconomic impacts of 

fuel price volatility on the country's economy. 

By coordinating rebuilding efforts with investment in renewables and demand-side management, there is 

an opportunity to realize even greater cost savings. Renewables and, especially, demand-side 

management and energy storage can provide peak generating capacity to the grid, allowing Puerto Rico to 

minimize investment in new generating assets. Locally deployed resources can also defer, minimize, or 

avoid transmission and distribution expenses. Designing the new grid for flexibility and avoiding capital 

costs reinvested in legacy infrastructure can allow for higher levels of renewable energy, likely at cost 

savings to the current system. 

This coordinated investment would also be significantly more resilient and sustainable and decentralized. 

By siting generation closer to loads, especially in the North and in remote communities or islands of 

Vieques and Culebra, and connecting in "islandable" microgrids that can maintain operations during 

larger grid outages, it is possible to prioritize critical loads and minimize restoration time, as already seen 

with recent projects from Tesla and Sunrun. as well as other pre-existing solar systems on the island. 

Investments in microgrids and other distribution improvements, as well as energy storage can improve 

cost-effectiveness and reliability. 

A coordinated rebuild would allow hard-hit communities and anchor businesses to be repowered earlier, 

and allow many communities the opportunity to shape and participate in the energy sector directly. 

Prioritizing distributed microgrids could avoid the costs of rebuilding certain costly and hard to access 

lines to remote communities while restoring services faster. An investment plan that leveraged this 

resource, and planned for eventual grid integration of most of these remote systems, would result in a 
232 


stronger and more resilient grid in the long run, minimize the risk of flight from residents and businesses 

currently without power, and require less total funding from the US Government. 

To seize these benefits, a few key steps appear clear, and more will emerge from a coordinated response 

of all involved in Puerto Rico. 

Change key Stafford Act provisions to direct FEMA to fund a better rebuild of the grid, not 

rebuilding what was damaged by the hurricanes. 

Deploy federal funds (HUD, CDGB, Disaster Recovery, DOE, etc.), and other loans to quickly 

deploy solar and storage microgrids to key parts of Puerto Rico using an open and transparent 

procurement process. In other words, the opposite of what transpired with the Whitefish contract. 

Operational and business model restructuring of PREP A to ensure they are prepared to lead this 

rebuild and the operation of the grid thereafter 

Set a long-term vision, and support grid-level investment in new renewable technologies, storage, 

energy efficiency, distributed generation and grid intelligence to better prepare for the future and 

create jobs 

Support a strong and independent regulatory body to minimize costs, and ensure an electricity system 

that will support future energy policies that will help Puerto Rico rebound. 

Your leadership in the weeks ahead, could help transform the entire electricity grid in Puerto Rico and the 

US Virgin Islands in a manner that will prevent future suftering by the residents of the territories and 

transform the economy. This is a situation where rapid investments in resilient, renewable and 

decentralized energy sources makes environmental, public health and fiscal sense. We would be happy to 

discuss these issues further and can be reached at Judithaenck@gmail.com and 

Ramon.Javier.cruz@gmail.com. Thank you. 

Sincerely, 

Judith Enck 

Former EPA Region 2 Regional Administrator 

(including NY, NJ, Puerto Rico and US Virgin Islands) 

Ramon Cruz 

Former Commissioner, Puerto Rico Energy Commission 

Former Vice Chair, Puerto Rico Environmental Quality Board 
233 


GREG WALDEN, OREGON 

CHAIRMAN 

ONE HUNDRED FIFTEENTH CONGRESS 

fRANK PALLONE, JR., NEW JERSEY 

RANKING MEMBEH 

lll:ongregs- ot tbe ~lnittb ~tatts 

j!)ouse of l'\epresentatibe5 

COMMITTEE ON ENERGY AND COMMERCE 

2125 RAvnunN HousE Omn BuiLDING 

WASHINGJON, DC 20515-6115 

Ms. Patricia Hoffman 

Majonty (207) 2:'5 ~~0?7 

Mmrmty U02)2?0<Jt>41 

December 4, 2017 

Acting Under Secretary for Science and Energy 

Principal Deputy Assistant Secretary 

Office of Electricity Delivery and Energy Reliability 

L:.S. Department of Energy 

1000 Independence Avenue, S.W. 

Washington, DC 20585 

Dear Ms. Hoffman: 

Thank you for appearing before the Subcommittee on Energy on November 2, 2017, to testify at 

the hearing entitled "The 20 I 7 Hurricane Season: A Review of Emergency Response and Energy 

Infrastructure Recovery Efforts." 

Pursuant to the Rules of the Committee on Energy and Commerce, the hearing record remains 

open for ten business days to permit Members to submit additional questions for the record, which are 

attached. The format of your responses to these questions should be as follows:(!) the name of the 

Member whose question you are addressing, (2) the complete text of the question you are addressing in 

bold, and (3) your answer to that question in plain text. 

To facilitate the printing of the hearing record, please respond to these questions with a 

transmittal letter by the close of business on Monday, December 18, 2017. Your responses should be 

mailed to Allie Bury, Legislative Clerk, Committee on Energy and Commerce, 2125 Rayburn House 

Office Building, \Vashington, DC 20515 and e-mailed in Word format to A_!Jj_e.Bm:y@maiLhousc.gov_ 

Thank you again for your time and effort preparing and delivering lestimony before the 

Subcommittee. 

Sincerely, 

Subcommittee on Energy 

cc: The Honorable Bobby L. Rush, Ranking Member, Subcommittee on Energy 

Attachment 
234 


Department of Energy 

Washington, DC 20585 

The Honorable Fred Upton 

Chairman 

Subcommittee on Energy 

February 27,2018 

Committee on Energy and Commerce 

U.S. House of Representatives 

Washington, DC 20515 

Dear Mr. Chairman: 

On November 2, 2017, Principal Deputy Assistant Secretary Patricia Hoffman testified 

regarding a hearing entitled "The 2017 Hurricane Season: A Review of Emergency 

Response and Energy Infrastructure Recovery Efforts". 

Enclosed are answers to questions submitted by Representatives Bilirakis and you. 

If you need any additional information or further assistance, please contact me or Fahiye 

Yusuf, Office of Congressional and Intergovernmental Affairs at (202) 586-5450. 

Enclosures 

cc: The Honorable Bobby Rush 

Ranking Member 

Marty Dannenfelser 

Deputy Assistant Secretary for House Affairs 

Congressional and Intergovernmental Affairs 

* Printed with soy Ink on recycled paptJr 
235 


QUESTIONS FROM CHAIRMAN UPTON 

Q1. Please provide a description and timeline of DOE personnel and activities on Puerto Rico 

and the U.S. Virgin Islands. 

A I. The U.S. Department of Energy (DOE) continues to support restoration and recovery 

efforts related to Hurricanes Maria and Irma in Puerto Rico and the U.S. Virgin Islands 

(USVI). DOE Emergency Support Function #12 Energy (ESF-12) responders were 

deployed to Puerto Rico in support of the Federal Emergency Management Agency 

(FEMA) until the week of February 19 and DOE continues to provide ESF #12 support to 

FEMA as needed. DOE ESF #12 responders deployed to the USVI demobilized on 

January 12 and a team from DOE's National Renewable Energy Laboratory (NREL) 

completed a deployment to perform assessments of USVI electricity infrastructure. A 

team of 25 available personnel and I 0 line-trucks from DOE's Western Area Power 

Administration (WAPA) went to St. Thomas to provide mutual aid, through a DOE 

mission assignment from FEMA and at no cost to WAPA's rate payers, to restore the 

transmission system on the island. The WAPA crews completed work on the transmission 

system and finished work on November 29. 

DOE has also relied upon subject matter experts from several Power Marketing 

Administrations (PM As) to provide technical assistance to the U.S. Army Corps of 

Engineers (USACE) for restoration planning on Puerto Rico and had a person deployed 

to assist FEMA with ESF-15- External Affairs. In addition to DOE's deployments of 

personnel, there are also DOE personnel who volunteered for the FEMA Surge Capacity 

Force. 

Finally, Secretary Perry, Deputy Secretary Brouillette, and Under Secretary Menezes 

have all visited Puerto Rico and the US VI, and Assistant Secretary Bruce Walker spent 

two weeks in Puerto Rico to help coordinate electricity restoration efforts between 

FEMA, USACE, the Puerto Rico Electric Power Authority (PREP A), and industry. A 

timeline of key DOE activities is below: 

• September 3: ESF -12 responders deploy to Puerto Rico, St. Thomas, and St. Croix 
236 


• September 4: ESF-12 responders deploy to the FEMA Region II Response 

Coordination Center; ESF-12 responders were already deployed to the FEMA 

National Response Coordination Center to provide 24/7 coverage for Hurricane 

Harvey 

• September 6: Hurricane Irma impacts the USVI and Puerto Rico 

• September 17: ESF-12 responders demobilize from Puerto Rico-PREPAreports 

96% of customer outages from Hurricane Irma had been restored 

• September 17/18: Advance team from WAPA travels to San Juan, Puerto Rico in 

preparation for arrival in St. Thomas 

• September 19/20: Hurricane Maria impacts the USVI and Puerto Rico; ESF-12 

responders on St. Thomas and St. Croix shelter-in-place with FEMA Incident 

Management Assistance Team 

• September 19: ESF-12 responders pre-position in Atlanta, GA for deployment to 

Puerto Rico 

• September 19/20: FEMA declares response to Hurricane Maria a Level I event and 

transitions incident support responsibilities of the FEMA Region ll Response 

Coordination Center into the National Response Coordination Center 

• September 20: Line-trucks from WAPA ship en route to St. Thomas 

• September 22: ESF-12 responders arrive in Puerto Rico 

• September 24: WAPA advance team arrives on St. Thomas, begins assessments of the 

transmission system, and prepares for arrival of additional personnel and equipment 

• September 28-0ctober 2: Seventeen additional personnel and the line-trucks arrive 

on St. Thomas, from WAPA 

• October 4: USACE receives Mission Assignment from FEMA to support grid 

restoration in Puerto Rico. USACE formally requests subject matter experts from 

DOE to provide technical assistance; however, DOE and USACE had already been in 

close coordination in preparation for expanded mission 

• October 6: DOE begins deployment of personnel to support FEMA with ESF-15 on 

Puerto Rico 

• October 18: Subject matter experts from PMAs begin engagement in Puerto Rico to 

provide technical assistance to USACE 

2 
237 


• October 23: Assistant Secretary Bruce Walker deploys to Puerto Rico for two weeks 

• November I: Assistant Secretary Walker visits St. Croix 

• November 9: FEMA National Response Coordination Center demobilizes 

• November 28: DOE Recovery Support Function responder deploys to Puerto Rico to 

support recovery mission under National Disaster Recovery Framework (NDRF) 

• November 29: WAPA personnel and equipment complete restoration of the 

transmission system on St. Thomas 

• December 12: NREL personnel arrive in the USVI to support assessments of energy 

infrastructure-onsite assessment complete within two weeks 

• January 12: ESF #12 responders deployed to USVI complete demobilization 

• January 26: DOE deployed a responder to Puerto Rico under a FEMA NDRF mission 

assignment to represent DOE as a primary agency in the Infrastructure Systems 

Recovery Support Function supporting the creation of the Federal recovery plan 

• February I 9: ESF #12 responders deployed to Puerto Rico demobilize-DOE subject 

matter experts remain deployed to provide technical assistance to US ACE and DOE 

continues to provide ESF # 12 support as needed 

Throughout the deployment of personnel for Hurricanes Harvey, Inna, Maria, and Nate, 

the DOE Energy Response Organization has been activated at DOE Headquarters 

providing support to deployed personnel, FEMA, and other Federal partners as well as 

coordinating with industry. Personnel were also deployed to the Region IV and VI 

Coordination Centers and State Operations Centers in Texas, Florida, Georgia, Alabama, 

and Louisiana for hurricanes as well as California in support of wildfires. 

DOE is also supporting implementation of the NDRF and serves as a primary agency for 

Infrastructure Systems on the Recovery Support Function Leadership Group (RSFLG). 

The RSFLG meets regularly to coordinate cross-cutting recovery issues specifically 

related to Puerto Rico and the US VI. DOE briefed the RSFLG on the One Vision Plan at 

its most recent Under Secretaries level meeting on January 9, 2018. The One Vision 

Action Plan for Power Restoration for Puerto Rico integrates plans and materials from 

multiple resources (New York Power Authority; PREP A; Puerto Rico Oversight, 

3 
238 


Management, and Economic Stability Act (PROMESA); Governor's plan; and others) 

into a unified solution set. The draft Plan-due February 5, 20 I 8, and to be released April 

30, 20 18-will incorporate resilient measures, and will be utilized in the Puerto Rico 

Recovery Plan. DOE also sent personnel to Puerto Rico through a FEMA Mission 

Assignment specifically to address recovery-related concerns there and work with other 

RSF partners to focus on a resilient recovery. 

On Puerto Rico, as of February 21, PREPA reports that 84.5 percent of normal peak load 

and 85.6 percent of customers (1,261 ,513 of 1.47 million) have been restored and all 78 

municipalities are at least partially energized or have an energized facility. As of February 

21, approximately 92 percent of substations have been restored, and there were 4,896 line 

workers and associated personnel supporting the restoration efforts. USACE, as the 

coordinating agency for ESF 3 Public Works and Engineering, received a mission 

assignment from FEMA to lead the Federal role in repairing the hurricane-damaged 

electrical power grid in support of the Government of Puerto Rico. USACE has partnered 

with PREP A, DOE, and FEMA to restore safe and reliable power to the people of Puerto 

Rico. USACE has awarded several major contracts to assist with the restoration efforts 

covering the crews and equipment to work on the transmission and distribution lines that 

need repairs, and for generators to stabilize the power grid, such as those installed in Palo 

Seco. USACE has also worked with PREP A to identify the materials and equipment 

needed for the restoration effort, which have been procured through the Defense Logistics 

Agency. USACE utilized the U.S. Navy's USNS Brittin Roll-On-Roll-Off Cargo Ship to 

transport these materials and equipment between Charleston, South Carolina and the 

Puerto Rico. In addition to the USACE restoration efforts, DOE and FEMA have worked 

closely with industry, through the Electricity Sub-Sector Coordinating Council, to 

facilitate mutual assistance and additional subject matter experts from utilities across the 

country. 

In the USVI, as of January 31, the Virgin Islands Water and Power Authority (VIWAPA) 

reported that 51,473 customers (93 percent of total customers and 99 percent of 

customers currently eligible to receive power) have had electrical power restored. 

VIWAPA also began a No Customer Leji Behind campaign aimed at reconnecting all 

4 
239 


customers who can be restored to the electric grid and who may have been bypassed 

during the initial phase of restorations. As of January 31, following the completion of 

DOE's ESF #12 mission in the USVI and given VIWAPA's progress, DOE has 

discontinued regular updates on the restorations efforts but remains available to support if 

needed. DOE and FEMA have worked with industry to facilitate mutual assistance, 

including crews and equipment from the Northeast Public Power Association and 

VIWAPA has retained two off-island contractors to support the restoration efforts. 

5 
240 


QUESTIONS FROM REPRESENTATIVE BILIRAKIS 

Ql. You mentioned in your response to my question regarding challenges that still exist poststorm for Florida that Florida needs to re-examine its fuel distribution network since it 

was identified as a vulnerability following the storm. 

Q I a. What resources (technical expertise and assistance, grants, etc.) are available from DOE 

to assist Florida as it re-examines its fuel distribution network and seeks to implement 

changes? 

A I a. The U.S. Department of Energy (DOE), through the Office of Electricity Delivery and 

Energy Reliability, works closely with State and local governments on energy assurance 

planning, including fuel distribution. DOE also works with State and local organizations, 

including the National Association of State Energy Officials (NASEO), the National 

Emergency Management Association (NEMA), National Governors Association (NGA), 

and the National Conference of State Legislatures (NCSL). 

DOE is supporting improved emergency fuel planning by providing technical expertise 

through organizations including NASEO and NEMA. The goal of these efforts is to 

enhance planning, coordination, and planning of fuel distribution during emergencies. 

These efforts will include the publication by NASEO of a fuel emergency guide for State 

governments and an emergency fuel planning workshop. The publication and workshop 

are meant to share best practices and provide planning templates, sample language for 

executive orders, and hosting exercises and planning workshops that will bring Federal, 

State, local, tribal, and territorial governments together with law enforcement and 

industry. These efforts are meant not only to unify effort, but also to unify messaging 

during an emergency to better inform citizens and customers of potential impacts and 

actions to take during an event. DOE anticipates completing these actions by May 31, 

2018, in time for the 2018 hurricane season. 

6 
241 


Q2. Florida Power and Light (or FPL) is the nation's 3'd largest electric utility and its smart 

grid is widely considered to be an industry 'gold standard' for performance and 

resiliency. In fact, FPL received 2 industry awards earlier this year for its performance 

during the 2016 hurricane season. Yet, despite the awards and continued system 

investments totaling nearly $3 billion since 2006, Irma laid waste to a large portion of the 

grid prompting FPL to announce that their West Coast system in Florida would need a 

"wholesale rebuild." 

Q2a. What is currently being done to ensure better grid resiliency against future natural and 

manmade disasters? 

A2a. DOE works closely with State and local governments and industry to enhance the 

resilience of the Nation's energy infrastructure. One way DOE ensures resilience is 

through existing emergency authorities. The Department has existing authorities under 

section 202(c) of the Federal Power Act to issue emergency orders during disasters or 

other energy emergency situations. DOE has leveraged these authorities in the past to 

support interconnection power flows to keep the lights on. 

The Fixing America's Surface Transportation Act gave the Secretary of Energy new 

authority, upon declaration of a Grid Security Emergency by the President, to issue 

emergency orders to protect or restore the reliability of critical electric infrastructure or 

defense critical electric infrastructure. This authority allows DOE to support energy 

sector preparations for and responses to various events, including electromagnetic pulses 

(EMP), geomagnetic disturbances (GMD), and cyber and physical attacks. 

As part of a comprehensive effort to reduce the impact of severe weather and other 

events, DOE has supported research and development to enhance resilience, including 

advanced grid technologies, microgrids, and energy storage. DOE continues to pursue 

increased resilience through other activities, including our recent Resilient Distribution 

Systems Lab Call awards. Under the Grid Modernization Initiative, DOE announced the 

award in September of up to $32 million over three years to the Grid Modernization 

Laboratory Consortium to support early stage research and development of nextgeneration tools and technologies to further improve the resilience of the Nation's critical 

energy infrastructure, including the electric grid and oil and natural gas infrastructure. 

7 
242 


Another way DOE is working to ensure grid reliability in the organized markets is 

through the rule proposed to the Federal Energy Regulatory Commission in September 

that would ensure that certain reliability and resilience attributes of electric generation 

resources are fully valued. A reliable, resilient electric grid depends on a diverse mix of 

resources, and must include traditional base load generation with on-site fuel storage that 

can withstand major fuel supply disruptions caused by natural and man-made disasters. 

Q2b. What public utility and energy delivery challenges still exist? 

A2b. The 2017 hurricane season highlighted the need for a focus on energy system resilience. 

The recent severe weather events, changing resource mix, and dynamic nature of grid 

technologies-including changes on the demand side-are bringing grid resilience to a 

new, more prominent place in the national dialogue on this topic. Specifically, as we keep 

an eye on day-to-day reliability, as well as resource adequacy, we must also incorporate 

additional issues related to resilience into the discussion. 

Q2c. How do we proactively address during our recovery process? 

A2c. DOE is cognizant of its unique role in addressing these challenges and that it is critical to 

be proactive and cultivate an ecosystem of resilience, including: a network of producers, 

distributors, regulators, vendors, and public partners, acting together to strengthen the 

ability to prepare for, respond to, and recover from disruptions. This includes continuing 

to partner with industry, other Federal agencies, State and local governments, and other 

stakeholders to address the issue of resiliency. Federal interagency partners are 

implementing the National Disaster Recovery Framework (NDRF) through regular series 

meetings of the Recovery Support Function Leadership Group (RSFLG). DOE is one of 

the primary agencies (along with FEMA and the Department of Transportation) under the 

Infrastructure Systems (IS) Recovery Support Function, which is coordinated by the U.S. 

Army Corps of Engineers (USACE). DOE briefed the RSFLG on the One Vision Plan at 

its most recent Under Secretaries-level meeting on January 9, 2018. The One Vision 

Action Plan for Power Restoration for Puerto Rico (PR) integrates plans and materials 

from multiple resources (New York Power Authority, PR Electric Power Authority, PR 

Oversight, Management, and Economic Stability Act (PRO MESA), Governor's plan, and 

8 
243 


others) into a unified solution set. The draft Plan-due February 5, 2018, and to be 

released April 30, 20 18-will incorporate resilient measures, and will be utilized in the 

PR Recovery Plan. During the recovery process there are opportunities to identify where 

additional or new mitigation measures could improve the overall resilience of the system, 

such as flood monitoring at substations, cement and composite poles to replace damaged 

wood poles, and incorporating advanced grid technologies. 

Q3. Puerto Rico recently invited Testa to pilot new technologies in the U.S. territory in an 

effort to get their grid back up in a low-cost, efficient manner. Are there other grid 

projects underway across the U.S. using this or a similar public-private model? If not, are 

there currently any barriers in statute that need to be addressed to pave the way for more 

such projects? 

A3. Many companies have offered aid to Puerto Rico, looking to explore use of various types 

of technology and/or financing. Tesla specifically offered simple replacement of diesel 

engines, which gives Tesla a chance to test their product. Other companies are interested 

in financing commercial demonstrations ofmicrogrids, which would generally be larger 

projects, but could involve major investments with uncertain returns. Issues in Puerto 

Rico have included theft of equipment and lack of certainty regarding return on 

investments. 

9 
244 


GREG WALDEN, OREGON 

CHAIRMAN 

\<Jr. Charles Alexander 

ONE HUNDRED FIFTEENTH CONGRESS 

FRANK PALLONE, JR., NEW JERSEY 

RANKING MEMBER 

<!:ongre!.i'% of tbr '(!nitcb ~tatt!) 

ot li\epre!1entaWJc% 

COMMITTEE ON ENERGY AND COMMERCE 

2125 RAYBURN HousE OFFICE BuiLDING 

WASHINGTON, DC 20515-6115 

December 4, 2017 

Director of Contingency Operations 

U.S. Army Corps of Engineers 

441 G Street, N.W. 

Washington, DC 20314 

Dear Mr. Alexander: 

Thank you for appearing before the Subcommittee on Energy on November 2, 2017, to testify at 

the hearing entitled "The 2017 Hurricane Season: A Review of Emergency Response and Energy 

Infrastructure Recovery Efforts." 

Pursuant to the Rules of the Committee on Energy and Commerce, the hearing record remains 

open for ten business days to permit Members to submit additional questions for the record, which are 

attached. The format of your responses to these questions should be as follows: (l) the name of the 

Member whose question you arc addressing, (2) the complete text of the question you are addressing in 

bold, and (3) your answer to that question in plain text. 

To facilitate the printing of the hearing record, please respond to these questions with a 

transmittal letter by the close of business on Monday, December 18, 2017. Your responses should be 

mailed to Allie Bury, Legislative Clerk, Committee on Energy and Commerce, 2125 Rayburn House 

Office Building, Washington, DC 20515 and e-mailed in Word format to 6Wc.BJJn(c/mlniLh9USc,_goy. 

Thank you again for your time and effort preparing and delivering testimony befOre the 

Subcommittee. 

Sincerely, 

Subcommittee on Energy 

cc: The Honorable Bobby L. Rush, Ranking Member, Subcommittee on Energy 

Attachment 
245 


The 2017 Hurricane Season: A Review of Emergency Response and Energy Infrastructure 

Recovery Efforts 

Committee on Energy and Commerce, Subcommittee on Energy 

November 2, 2017 

Attachment- Additional Questions for the Record 

The Honorable Fred Upton 

1, The Army Corps of Engineers is the primary agency for ESF#3 related to public works 

and engineering, including conducting preincident and postincident assessments of public 

works and infrastructure; executing emergency contract support for life-saving and lifesustaining services; providing technical assistance to include engineering expertise, 

construction management, and contracting and real estate services; providing emergency 

repair of damages public infrastructure and critical facilities. 

2. Please detail all activities the Corps engage in under this function to evaluate the 

integrity and viability of drinking water delivery systems and infrastructure under this 

authority for Hurricanes Harvey, Irma, and Maria. 

Answer: The U.S. Army Corps of Engineers, primary agency under ESF #3 and the U.S. 

Environmental Protection Agency (EPA), support agency to the Corps under ESF#3 and primary 

agency under ESF# I 0, conducted water and wastewater system assessments and provided waterrelated technical assistance during the 2017 hurricane season. Specifically, the Corps and EPA 

deployed personnel to coordinate and execute all necessary assessments, evaluation, and 

design/build response and recovery actions associated with ensuring the safety of drinking water 

and wastewater systems in the affected area in coordination with the appropriate State agencies, 

as directed by FEMA and requested by the State or Territorial governments. These actions 

included but are not limited to providing laboratory support for water sample collection, analysis 

and data interpretation; assessing public water and wastewater systems; facilitating the contact 

with Federal, State and local agencies and providing oversight of drinking water and wastewater 

system restoration, and related activities, including repairs. 

3. Please detail the interactions between the Corps and the U.S. Environmental Protection 

Agency or State/Territorial agencies with primary enforcement authority for Federal 

environmental laws in support of ESF#3 for Hurricanes Harvey, Irma, and Maria. 

Answer: Prior to awarding any contract in response to ESF#3 mission assignments, the Corps 

coordinates directly with ESF #1 0 (EPA) to identify and address all environmental requirements 

set forth by all Federal, State/Territorial agencies. The Corps takes action to avoid, minimize 

and mitigate actions that impact the environment. In cases where environmental impacts cannot 
246 


be avoided, the Corps documents these impacts and follows environmental law to disclose and 

address these impacts. 

4. Please detail any funding requests or response and recovery recommendations made to 

or denied by the Federal Emergency Management Act for addressing water, waste water, 

or solid waste under this function. 

Answer: FEMA aided the Government of Puerto Rico's request for water, waste water, and 

solid waste by providing funding under three separate mission assignments. The primary 

mission assignment was accomplished by funding provided directly to Puerto Rico's water and 

sewage agency, PRASA, who in turn contracted the assessment of their infrastructure system(s) 

to a contractor. A second mission assignment was provided to the EPA to focus on 

environmental impacts and potential threats to people's health, as well as the safety of those in 

the affected areas. EPA's mission included sampling, analysis and lab support, and getting 

wastewater systems up and running. The third mission assignment provided to the Corps was 

limited in scope and amounted to our providing personnel to support the efforts of the previously 

discussed primary mission assignments. While the Corps had limited interactions with the 

PRASA contractor conducting the assessments, the Corps did coordinate regularly with EPA as 

its mission assignment evolved over time. While the PRASA contractor focused their efforts on 

the major population centers, FEMA modified the Corps mission to conduct assessments to 

water and waste water infrastructure systems in remote areas of Puerto Rico. In this effort, the 

Corps included EPA for assistance in detem1ining water potability. All Corps funding requests 

to FEMA were approved with respect to water, waste water, and debris management in Puerto 

Rico. Any and all recommendations to FEMA were considered by FEMA and forwarded to the 

Puerto Rican government for consideration and potential implementation. 

5. Please provide all guidance or information to date provided to Army Corps by FEMA or 

PREP A regarding coordination efforts to rebuild the electrical grid. 

Answer: On September, 30 2017, the Corps was given a FEMA mission assignment, within the 

authority of the Stafford Act, to assist the Puerto Rico Electric Power Authority (PREP A) in 

further repairing the power system to its pre-storm condition. 

This mission assignment from FEMA states that the Corps will" ... lead planning, coordination 

and integration efforts in preparation to execute electrical power grid restoration in Puerto Rico 

due to impacts caused by Hurricane Maria. Develop and execute applicable temporary repairs to 

the segments electrical grid to allow interim restoration of system segments as directed by 

FEMA until the full electrical grid restoration can be implemented." 

The Corps works through the unified command group (Governor's power restoration 

coordinator, FEMA, the Corps and PREP A) on a daily basis to coordinate efforts to rebuild the 

electrical grid. Through the unified command group, the Corps and PREP A developed a master 

plan for transmission and anotl1er for distribution that prioritizes lines for restoration enabling 

work to continue in a materials constrained environment to restore power and ensure the public 

safety. It is important to note the critical path is materials needed to restore power, this is 

addressed in another response below. 
247 


All critical infrastructure such as hospitals have temporary generation until the power grid is 

restored and they are connected to it. In addition, seven remote communities have micro-grids 

established using the repaired distribution lines and electric substations connected to generators 

until the transmission grid is restored. Two more micro-grids are planned for a total of nine at 

this time. The combination of temporary power, interim micro-grid power and permanent power 

restoration are proving very effective. 

6. Please provide a timeline of Army Corps awareness and involvement with any and all 

contracts or activities with PREP A since August 2017. 

Answer: Although the Corps and PREP A meet daily to establish direction for line assignments, 

contract oversight for PREP A's contractors and their own workforce are solely the responsibility 

of PREP A. The Corps has no involvement in contracts awarded and managed by PREP A. 

However, under the FEMA mission assignment received by the Corps, the Corps oversees only 

its federal contracts to execute mission assignments. 

The Corps coordinates with PREP A on a daily basis for planning and execution of the power 

grid restoration. This includes identification, acquisition and transport of materials; prioritization, 

assignment and coordination of work; and synchronization of communication activities. The 

Corps does have visibility of line assignments being worked by Corps contractors, PREP A and 

PREP A contractors, and public sector utilities under mutual aid agreement with PREP A. This 

helps to reduce interferences between workforccs. 

7. Please provide a copy of all contracts awarded by Army Corps for power restoration on 

Puerto Rico. 

Answer: See attached. As assigned by FEMA, the Corps leads the federal role in repairing the 

hurricane-damaged electrical power grid in support of the Government of Puerto Rico. The 

Corps executes this mission in coordination with its other Federal partners from FEMA and the 

Department of Energy (DOE) and the Corps has received $1.909 billion towards this effort to 

date. Below is a description of the contracts. 

Line repair contracts 

• On October 16, 2017, the Corps awarded a $240 million time and materials contract to Fluor 

Corp. to repair the power grid in Puerto Rico. This contract was later modified to increase the 

ceiling on the original contract to $505 million. FEMA has provided all these funds. On 

December 7, 2017, he Corps also awarded a second time and materials contract with an $831 

million ceiling to Fluor Corp. to support ongoing work to restore the power grid in Puerto 

Rico. To date $500m have been provided for this second contract. The remaining $331M is 

being held FEMA as a risk management reserve until it is needed. 

• On October 19, 2017, the Corps awarded a sole source time and materials $40 million 

contract to PowerSecurc, Inc. to provide additional support to the repair of distribution and 

transmission lines. In early November, the Corps increased the contract by $48 million, now 

totaling $88 million. This was done to accelerate restoration work. On Nov 17, 2017, the 
248 


contract ceiling was increased by $302M to a total contract capacity of $390M. The 

additional funds will bring additional people, equipment and materials to the effort to repair 

hurricane-damaged transmission and distribution lines to western portion of the island. 

Generation contracts 

• On November 6, 2017, the Corps awarded a $19 million contract to APTIM Federal 

Services, LLC. for the installation of one 25MW generator for temporary power at the 

Yabucoa Power Plant. This was needed to ensure more reliable power for the Yabucoa and 

Humacao areas, the most heavily impacted areas located in southeast Puerto Rico. On 

December 9, 2017, the contract was increased to $36M to provide two months of operations 

and maintenance through Feb 12,2018. 

• On October 8, 2017, the Corps awarded a $35.1 million contract to Weston Solutions to 

provide50 MW capacity to the Palo Seco Power Plant, which stabilized the power grid. On 

October 29, 2017 the contract was increased to $80M to provide four months of operations 

and maintenance through February 28, 2018. 

Defense Logistics Agency Contract: On October 8, 2017, FEMA provided $80 million to the 

Corps to order materials for all entities performing power restoration which now includes: the 

Corps' contractors, PREP A and its contractors, and public sector utilities under mutual aid 

agreement with FEMA. Subsequently FEMA provided four additional increases to the Corps' 

materials mission assignment totaling $240 million. 

FEMA assigned the material acquisition mission to the Corps to ensure only one entity would 

place demands on an extremely constrained supply chain nationally and internationally to 

preclude a situation where multiple contractors would be in competition upon the supply chain. lt 

is important to note that many materials needed for the Puerto Rico grid restoration are no longer 

manufactured and require retooling by manufacturers which adds to delays. In addition, many 

materials normally used nationwide were depleted at public utilities and suppliers. Many of those 

recently received had manufacture dates in mid-December 2017. Hence, the decision to leverage 

the Defense Logistics Agency by the Corps synchronized the entire material demand requirement 

from one entity for all users in grid power restoration. 

The Honorable Gus Bilirakis 

1. Would you discuss how we can best streamline agency coordination to prevent 

bureaucratic overlap and redundancies which can lead to waste and unnecessary delays 

and hamper the effectiveness of response? 

Answer: All agencies involved in the Hurricane Maria response effort will complete a formal 

After Action Review concerning their emergency response efforts for these events. This process 

will provide recommendations to FEMA and the affected State and Territorial Governments for 

potential use in future events, including the 2018 Hurricane Season. 
249 


a. With a coordinated, interagency response, are there interagency goals that drive response 

and preparedness strategies? 

Answer: The National Response Framework (NRF) is the guiding document to assist the Federal 

Government in ensuring proper agency coordination takes place, and to prevent overlap of 

missions and to reduce redundancy across the Federal family. 

b. If so, what are these goals? 

Answer: The Corps executes its emergency response mission through the National Response 

Framework (NRF). The NRF, part of the National Preparedness System, sets the strategy and 

doctrine for how the whole community builds, sustains, and delivers the Response core 

capabilities identified in the National Preparedness Goal in an integrated manner with the other 

mission areas. To support the Goal, the objectives of the NRF are to: 

• Describe scalable, flexible, and adaptable coordinating structures, as well as key roles 

and responsibilities for integrating capabilities across the whole community, to support 

the efforts of local, state, tribal, territorial, insular area, and Federal governments in 

responding to actual and potential incidents. 

• Describe, across the whole community, the steps needed to prepare for delivering the 

response core capabilities. 

• Foster integration and coordination of activities within the Response mission area. 

• Outline how the Response mission area relates to the other mission areas, as well as the 

relationship between the Response core capabilities and the core capabilities in other 

mission areas. 

Provide guidance through doctrine and establish the foundation for the development of 

the Response Federal Interagency Operational Plan (FlOP). 

• Incorporate continuity operations and planning to facilitate the performance of response 

core capabilities during all hazards emergencies or other situations that may disrupt 

normal operations. 

• The NRF is composed of a base document, Emergency Support Function (ESF) Annexes, 

and Support Annexes. 

The Federal Government and many state governments organize their response resources and 

capabilities under the ESF construct. ESFs have proven to be an effective way to bundle and 

manage resources to deliver core capabilities. The Federal ESFs are the primary, but not 

exclusive, Federal coordinating structures for building, sustaining, and delivering the response 

core capabilities. Most Federal ESFs support a number of the response core capabilities. In 

addition, there are responsibilities and actions associated with Federal ESFs that extend beyond 

the core capabilities and support other response activities, as well as department and agency 

responsibilities. 

The Corps of Engineers serves as the coordinating agency for one of the fourteen ESFs within 

the NRF. ESF-3, Public Works and Engineers has as its goal/objective the mission to Stabilize 
250 


critical infrastructure functions, minimize health and safety threats, and efficiently restore and 

revitalize systems and services to support a viable, resilient community. 

To that end, the Corps of Engineers in Puerto Rico, established a general officer led division 

forward headquarters located in San Juan to coordinate our FEMA mission assignments to 

achieve these objectives and goals. One major subordinate task force was led by a colonel for 

power restoration and another, was established to execute program management to oversee 

mission execution for all other FEMA mission assignments. 
251 


GREG WALDEN, OREGON 

CHA!HMAN 

ONE HUNDRED FIFTEENTH CONGRESS 

FRANK PALLONE, JH., NEW JERSEY 

RANKING MEMBER 

l!ongrc5'5' of tl)e mntteb ~tates 

;l!'oul5e of i\eprt£icntntibtl5 

COMMITIEE ON ENERGY AND COMMERCE 

2125 RAYBURN House OFFicE BultD:No 

WASHINGTON, DC 20515-6115 

Mr. Robert F. Corbin 

Deputy Assistant Secretary 

Office of Petroleum Reserves 

U.S. Department of Energy 

1000 Independence Avenue, S.W. 

Washington, DC 20585 

Dear Mr. Corbin: 

{20:1.)225-7977 

(707iJ:>G.:W41 

December 4, 2017 

Thank you for appearing before the Subcommittee on Energy on November 2, 2017, to testify at 

the hearing entitled "The 2017 Hurricane Season: A Review of Emergency Response and Energy 

Infrastructure Recovery Efforts." 

Pursuant to the Rules of the Committee on Energy and Commerce, the hearing record remains 

open for ten business days to permit Members to submit additional questions for the record, which are 

attached. The format of your responses to these questions should be as follows: (I) the name of the 

Member whose question you are addressing, (2) the complete text of the question you are addressing in 

bold, and (3) your answer to that question in plain text. 

To facilitate the printing of the hearing record, please respond to these questions with a 

transmittal letter by the close of business on Monday, December 18, 2017. Yourresponses should be 

mailed to Allie Bury, Legislative Clerk, Committee on Energy and Commerce, 2125 Rayburn House 

Office Building, \Vashington, DC 205l5 and e-mailed in Word format to tJJic.BwyJJlrrulil.:.b.Dlli~· 

Thank you again for your time and etTort preparing and delivering testimony before the 

Subcommittee. 

cc: The Honorable Bobby L. Rush, Ranking Member, Subcommittee on Energy 

Attachment 
252 


The Honorable Fred Upton 

Chairman 

Subcommittee on Energy 

Department of Energy 

Washington, DC 20585 

February 27,2018 

Committee on Energy and Commerce 

U.S. House of Representatives 

Washington, DC 20515 

Dear Mr. Chairman: 

On November 2, 2017, Deputy Assistant Secretary for Petroleum Reserves Robert Corbin 

testified regarding a hearing entitled "The 2017 Hurricane Season: A Review of 

Emergency Response and Energy Infrastructure Recovery Efforts". 

Enclosed are answers to questions submitted by Representatives Bilirakis and you. 

If you need any additional information or further assistance, please contact me or Fahiye 

Yusuf, Office of Congressional and Intergovernmental Affairs at (202) 586-5450. 

Enclosures 

cc: The Honorable Bobby Rush 

Ranking Member 

I 

I 

- ~ 

Marty Dannenfelser 

Deputy Assistant Secretary for House Affairs 

Congressional and Intergovernmental Affairs 

@ Printed with soy ink on recycled paper 
253 


QUESTIONS FROM CHAIRMAN UPTON 

Ql. How docs the Administration's budget request for a half-liquidation of the SPR fit into 

the Department's long-term vision for the SPR? 

Q I a. Congress has already directed a drawdown and modernization plan. Is the Department 

committed to clearing the maintenance backlog and modernizing the SPR? 

A I. The Department is still analyzing the impacts and footprints of a half-liquidation of the 

SPR. Potential issues we arc further analyzing are the possibility of a loss of 

resilience/redundancy due to site closures and a diminished drawdown rate. 

A I a. Yes, the Department is committed to clearing the maintenance backlog and modernizing 

the SPR. 

Q2. GAO's testimony stated that DOE contractors studied the feasibility of regional products 

reserves in the Southwest and West Coast regions to address supply vulnerabilities. 

Q2a. Please provide these studies and any analysis conducted by DOE relating to regional 

products reserves. 

A2a. The Department currently has no final studies on these topics. 

Q3. The Northeast Gasoline Supply Reserve (NGSR) was established by Secretary Moniz in 

2014 with funds obtained by the Department through a test sale of crude oil from the 

SPR. The NGSR has not been utilized and docs not have the statutory authority to 

operate as a regional products reserve. 

Q3a. Please explain why the NGSR has failed to achieve its intended purpose. 

Q3b. Please provide a full accounting of the cost of the Northeast Gasoline Supply Reserve. 

A3a. The NGSR was created to ease gasoline shortages that may result from sudden and 

unexpected supply interruptions in the Northeast US following Hurricane Sandy Since 

the creation of the NGSR, there has not been a gasoline supply disruption in the 

Northeast that has met the statutory release criteria. Because the NGSR was 

administratively established as part of the SPR, it must meet the same statutory 

requirements and conditions for release that apply to the SPR. 
254 


A3b. The total cost of acquiring the government-owned gasoline stored in the NGSR was 

$121,906,638.49. The total cost of the commercial leased storage contracts (spanning the 

period from July I, 2014 through December 31, 2018) was $88,298,000. Administrative 

costs, which include a quality assurance inspection program to ensure product 

specification as well as support for the Information Technology sales platform, arc: 

FY 20!4 (actual) $ 48,000.00 

FY 2015 (actual) $548,5 81.98 

FY 2016 (actual) $615,102.70 

FY 20 l 7 (actual) $325,050.80 

FY 2018 (estimated) $325,000.00 

FY 2019 (estimated Oct-Dec) $ 81,250.00 
255 


GREG VVAl DEN, ORLGON 

CHAIRMAN 

ONE HUNDRED FIFTEENTH CONGRESS 

FRANK PALLONE, ,JR., NE:W JERSEY 

RANKING MEMBEfl 

\!Congre~~ of tbe ~niteb ~tate~ 

i!Jom.lc of i~eprczentntibc!:l 

COMMITTEE ON ENERGY AND COMMERCE 

2125 RAYBURN House OFFicE BuiLDING 

WASHINGTON, DC 20515-6115 

Mr. Thomas A. Fanning 

Chairman, President, and CEO 

Southern Company 

30 Ivan Allen Jr. Boulevard, N.W. 

Atlanta, GA 30308 

Dear Mr. Fanning: 

(?0?1220.:>927 

{?02).?25-36111 

December 4, 20 I 7 

Thank you for appearing before the Subcommittee on Energy on November 2, 2017, to testify at 

the hearing entitled "The 2017 Hurricane Season: A Review of Emergency Response and Energy 

Infrastructure Recovery Efforts." 

Pursuant to the Rules of the Committee on Energy and Commerce, the hearing record remains 

open for ten business days to permit Members to submit additional questions for the record, which are 

attached. The format of your responses to these questions should be as follows: (I) the name of the 

Member whose question you are addressing, (2) the complete text of the question you arc addressing in 

bold, and (3) your answer to that question in plain text. 

To facilitate the printing of the hearing record, please respond to these questions with a 

transmittal letter by the close of business on Monday, December 18, 2017. Your responses should be 

mailed to Allie Bury, Legislative Clerk, Committee on Energy and Commerce, 2125 Rayburn House 

Office Building, Washington, DC 20515 and e-mailed in Word format to Allic.flUD:it;mail.hous~. 

Thank you again for your time and effort preparing and delivering testimony before the 

Subcommittee. 

cc: The Honorable Bobby L. Rush, Ranking Member, Subcommittee on Energy 

Attachment 
256 


Questions for the Record- Tom Fanning 

11111111#11####### 

Rep. Richard Hudson 

1. After each disaster we learn lessons about how to improve responses to emergencies at the federal 

level and how to better assist with state, local, municipal, and private entities. I am curious about one 

facet and that involves manpower. While we focus on the immediate need for equipment and 

supplies to be rushed to areas hurt by storms, there is also a need for qualified experts to flow to the 

region. When I see the massive scope of damage to power lines, for example, I wonder if there are 

enough linemen and women available to tackle the laborious work needed to rebuild our grid. North 

Carolina has been a leader in creating high-skilled job-training programs. At both Stanly Community 

College and Sandhills Community College, the advanced manufacturing programs are the critical 

training grounds for high-skilled manufacturing workers. In addition, I have worked with my 

colleagues on several pieces of legislation to address this critical issue. My question to you Mr. 

Fanning is twofold: 

a. Are companies able to find, train, and retain a workforce that can meet not only the daily 

challenges of operating a grid, but react to a natural disaster? Are we training enough folks at this 

point? 

b. I have heard from some of my utilities that there is also an issue with retirements affecting the 

workforce. As the current universe of lineworkers age, are we doing what we need to do to have the 

next generation of experts trained? 

###II######### 

Thank you for your questions Congressman Hudson. The Electricity Subsector Coordinating Council does 

not endorse legislation, and since I am responding in my capacity as an ESCC co-chair, I won't comment 

on the legislative aspect of your question. However, I know your bill H.R. 338, promoting a 21st century 

energy and manufacturing workforce, enjoys support from many stakeholders, including the electric 

power sector. 

More than a decade ago, the electric power industry saw the challenges you've mentioned-a coming 

wave of retirements, and the need to recruit and retain the future workforce-and formed the Center for 

Energy Workforce Development (CEWD), a non-profit consortium of electric, natural gas, and nuclear 

companies and their associations -the American Gas Association (AGA), American Public Power 

Association (APPA), Edison Electric Institute (EEl), Nuclear Energy Institute (NEI), National Rural Electric 

Cooperative Association (NRECA), and Distribution Contractors Association. CEWD has strategic 

partnerships with many other stakeholders including organized labor, career and technical schools, 

community colleges, government agencies, and workforce boards. (http://www.cewd.org/) 

According to a recent study (h!!!l.:flmjbrad~com/sites/defat,!lt/files/PoweringAmerica.pdf) conducted 

for APPA, EEl and NRECA, the electric power industry directly provides nearly 2. 7 million jobs nationwide 

through its employees, contractors and supply chain, and investments. That workforce is responsible for 

all of the work required to keep the energy grid operating safely and reliably; everything from routine 
257 

Æ 


maintenance and operations to emergency restoration when the power does go out. 

Specifically, as it relates to natural disasters, the electric power industry utilizes a voluntary mutual 

assistance program to restore power following major outages. When an impacted company requires 

resources that outstrip it's available workforce, it turns to its peers to "borrow" restoration workers. As I 

noted in my testimony, more than 10,000 electric power industry workers from at least 21 states 

mobilized to restore power to customers impacted by Hurricane Harvey, and more than 60,000 workers, 

coming from more than 250 electric companies across the United States and Canada were involved in 

the restoration following Hurricane Irma. 

To your second question on retirements and its impact on the workforce, that was the organizing 

principle that created CEWD. More than 10 years later, the solutions are in place and that coming wave 

of retirements is less of a concern. However, you correctly identify the need to train the next generation 

of grid experts. CEWD is focused on closing the skill gaps for the most critical jobs such as lineworkers, 

technicians, engineers and plant operators. The industry has put in place a number of solutions, but in 

particular, I'll mention the work the industry has done to hire more men and women who have served 

our country. According to the jobs study referenced above, military veteran hiring accounted for more 

than 10 percent of new hires in the electric power industry as of year-end 2014, the latest year for which 

data are available. 

########It####