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DEPARTMENT OF ENERGY OVERSIGHT: 

OFFICE OF FOSSIL ENERGY 

HEARING 

BEFORE THE

SUBCOMMITTEE ON ENERGY 

COMMITTEE ON SCIENCE, SPACE, AND 

TECHNOLOGY 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED FOURTEENTH CONGRESS 

SECOND SESSION 

May 11, 2016 

Serial No. 114–76 

Printed for the use of the Committee on Science, Space, and Technology 

( 

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

COMMITTEE ON SCIENCE, SPACE, AND TECHNOLOGY 

HON. LAMAR S. SMITH, Texas, Chair 

FRANK D. LUCAS, Oklahoma 

F. JAMES SENSENBRENNER, JR., 

Wisconsin 

DANA ROHRABACHER, California 

RANDY NEUGEBAUER, Texas 

MICHAEL T. MCCAUL, Texas 

MO BROOKS, Alabama 

RANDY HULTGREN, Illinois 

BILL POSEY, Florida 

THOMAS MASSIE, Kentucky 

JIM BRIDENSTINE, Oklahoma 

RANDY K. WEBER, Texas 

JOHN R. MOOLENAAR, Michigan 

STEVE KNIGHT, California 

BRIAN BABIN, Texas 

BRUCE WESTERMAN, Arkansas 

BARBARA COMSTOCK, Virginia 

GARY PALMER, Alabama 

BARRY LOUDERMILK, Georgia 

RALPH LEE ABRAHAM, Louisiana 

DARIN LAHOOD, Illinois 

EDDIE BERNICE JOHNSON, Texas 

ZOE LOFGREN, California 

DANIEL LIPINSKI, Illinois 

DONNA F. EDWARDS, Maryland 

SUZANNE BONAMICI, Oregon 

ERIC SWALWELL, California 

ALAN GRAYSON, Florida 

AMI BERA, California 

ELIZABETH H. ESTY, Connecticut 

MARC A. VEASEY, Texas 

KATHERINE M. CLARK, Massachusetts 

DON S. BEYER, JR., Virginia 

ED PERLMUTTER, Colorado 

PAUL TONKO, New York 

MARK TAKANO, California 

BILL FOSTER, Illinois 

SUBCOMMITTEE ON ENERGY

HON. RANDY K. WEBER, Texas, Chair 

DANA ROHRABACHER, California 

RANDY NEUGEBAUER, Texas 

MO BROOKS, Alabama 

RANDY HULTGREN, Illinois 

THOMAS MASSIE, Kentucky 

STEPHAN KNIGHT, California 

BARBARA COMSTOCK, Virginia 

BARRY LOUDERMILK, Georgia 

LAMAR S. SMITH, Texas 

ALAN GRAYSON, Florida 

ERIC SWALWELL, California 

MARC A. VEASEY, Texas 

DANIEL LIPINSKI, Illinois 

KATHERINE M. CLARK, Massachusetts 

ED PERLMUTTER, Colorado 

EDDIE BERNICE JOHNSON, Texas 
(III) 

C O N T E N T S 

May 11, 2016 

Page 

Witness List ............................................................................................................. 2 

Hearing Charter ...................................................................................................... 3 

Opening Statements 

Statement by Representative Randy K. Weber, Chairman, Subcommittee on 

Energy, Committee on Science, Space, and Technology, U.S. House of Representatives ........................................................................................................... 4 

Written Statement ............................................................................................ 6 

Statement by Representative Alan Grayson, Ranking Member, Subcommittee 

on Energy, Committee on Science, Space, and Technology, U.S. House of 

Representatives .................................................................................................... 8 

Written Statement ............................................................................................ 10 

Statement by Representative Lamar S. Smith, Chairman, Committee on 

Science, Space, and Technology, U.S. House of Representatives ..................... 12 

Written Statement ............................................................................................ 14 

Statement by Representative Eddie Bernice Johnson, Ranking Minority Member, Committee on Science, Space, and Technology, U.S. House of Representatives ........................................................................................................... 16 

Written Statement ............................................................................................ 18 

Witnesses: 

The Honorable Chris Smith, Assistant Secretary, Office of Fossil Energy, 

U.S. Departmentof Energy 

Oral Statement ................................................................................................. 20 

Written Statement ............................................................................................ 22 

Discussion ................................................................................................................. 32 

Appendix I: Answers to Post-Hearing Questions 

The Honorable Chris Smith, Assistant Secretary, Office of Fossil Energy, 

U.S. Departmentof Energy .................................................................................. 52 

(1) 

DEPARTMENT OF ENERGY OVERSIGHT: 

ENERGY 

WEDNESDAY, MAY 11, 2016 

HOUSE OF REPRESENTATIVES, 

SUBCOMMITTEE ON ENERGY, 

COMMITTEE ON SCIENCE, SPACE, AND TECHNOLOGY, 

Washington, D.C. 

The Subcommittee met, pursuant to call, at 10:07 a.m., in Room 

2318 of the Rayburn House Office Building, Hon. Randy Weber 

[Chairman of the Subcommittee] presiding. 
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Chairman WEBER. The Subcommittee on Energy will come to 

order. 

Without objection, the Chair is authorized to declare recesses of 

this Subcommittee at any time. 

I want to welcome you to today’s hearing titled ‘‘Department of 

Energy Oversight: the Office of Fossil Energy.’’ 

I recognize myself for five minutes for an opening statement. 

Again, welcome to today’s Energy Subcommittee hearing examining the Department of Energy’s Office of Fossil Energy. Today, 

we will hear from the Department on the research, development, 

demonstration and commercialization activities in the Office of Fossil Energy, and the impact DOE’s fossil energy programs have on 

the energy market and the U.S. economy. 

Fossil fuels are America’s dominant energy source, and provide 

over 80 percent of energy around the world. The International Energy Agency estimates that even if the aggressive regulations required to meet the Paris Climate Agreement are implemented, fossil fuels will still account for over 40 percent of global energy use 

in the year 2050. 

With those statistics in mind, DOE should prioritize the type of 

early stage research in fossil energy that will lead to next generation technology to access our natural resources, move fossil fuels 

safely to consumers, and then use those fuels more efficiently in 

our cars and in our power plants. Through the national labs, the 

Department should take the lead on fossil energy technology innovation, conducting the foundational research that allows the private sector to commercialize groundbreaking technology. 

Unfortunately, that is not the type of budget proposal we’re discussing today. In the DOE fiscal year 2017 budget request, it is 

clear that fossil energy innovation is not the priority for the Obama 

Administration. While the DOE budget proposal regularly offers aspirational goals backed by significant spending in renewable energy 

research and development, the budget for fossil energy is cut year 

after year. 

This year is no exception, with a $32 million cut to fossil energy 

R&D. When compared to the proposed $2.1 billion—with-a-B increase to renewable energy, there’s no question about where this 

Administration wants to innovate. And what’s worse, instead of research designed to increase fossil energy production through innovation or cut the cost of electricity from fossil fuels with new technology, the budget proposal for fossil energy is singularly focused 

on emissions management, or ‘‘impact mitigation’’ as the budget describes it. 

Simply put, the vast majority of DOE fossil energy research and 

development programs have been reduced to managing emissions 

to comply with EPA regulations. But over-regulation is not the 

right way to innovate. And the Department of Energy shouldn’t be 

dedicating limited taxpayer resources to proving commercial-scale 

technology to back up EPA rules. 

DOE’s research infrastructure should be used to develop 

groundbreaking technology, not move that technology to the commercial market. 

By focusing on justifying regulations and rushing to scale up today’s technology, the Department has repeatedly put taxpayer dol-
5 

lars at risk on large-scale projects that were not ready for prime 

time. Even the few successful projects that make it into operation, 

one in my district, the Air Product and Chemicals carbon capture 

sequestration storage demonstration project, are often completed at 

a great cost to the American taxpayer. DOE does not have adequate expertise or capacity to successfully manage commercialscale projects. So instead, the Department should focus limited federal dollars on the fundamental research to lay the foundation for 

the next technological breakthrough. 

The Department of Energy has made significant contributions to 

fossil energy production by funding early-stage research, and allowing the private sector to then make that technology work in the energy market. 

DOE research conducted by the national labs helped develop the 

technology of hydraulic fracturing that led to the shale revolution. 

If the Department refocuses on technology research and development, I believe that American industry can then capitalize on that 

research, and they can revolutionize the energy industry once 

again. But that won’t happen if DOE’s limited resources remain 

stove-piped—pun intended. Did you like that pun? All right—and 

focused on regulatory compliance. 

I want to thank Assistant Secretary Chris Smith for testifying 

here today, and I look forward to a review of the budget proposal 

and a discussion about DOE priorities and research goals for fossil 

energy. 

By funding early-stage research and development, the Department of Energy could build a foundation for the private sector to 

bring innovative new fossil energy technologies to market, and help 

grow the American economy, and I would even add help with those 

emissions. 

[The prepared statement of Chairman Weber follows:] 
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Chairman WEBER. With that, I want to yield to the Ranking 

Member for his opening statement. 

Mr. GRAYSON. Thank you, Chairman Weber, and thank you, Mr. 

Smith, for testifying today. 

Let’s be clear about what we are talking about. We are talking 

about air pollution in the form of carbon dioxide emissions. No 

company that produces energy in the United States has any incentive to limit its own air pollution unless we create that incentive 

for it. Now, there are different means to do that. For instance, we 

could simply order it. That’s regulation. My Republican colleagues 

might decry that as some kind of war on coal, but the fact is, that’s 

one way to actually cut emissions that wouldn’t happen otherwise. 

The second possibility is for the government to actually do it 

itself. The government could actually produce large-scale products 

that would capture carbon as it is being emitted or before it’s being 

edmitted into the atmosphere. That would be another solution to 

the problem. 

But there is no solution that does not involve some kind of government action because the private market will not limit pollution 

when the cost of pollution is zero. So either we have to create a 

cost of pollution through a market mechanism or we have to order 

its limitation one way or another as we did with the cap-and-trade 

bill from several years ago. 

So one way or another we need government involvement. I don’t 

particularly see any benefit in saying that it has to be a particular 

kind of government involvement. I don’t think there’s any benefit 

in saying it has to be small scale or limited to research or anything 

like that. The ultimate test is, is it effective or not. 

Now, with our government being formally committed under the 

Paris Climate Agreement to limitations on emissions, I think we 

have to be practical about how we get to those limits, how we 

achieve those goals. But it’s dreaming to think that it’s going to 

happen through the ‘‘free market’’ when the free market has every 

incentive to continue to pollute as much as it wants. 

Now, with regard to coal versus other sources of energy, we all 

know that coal has been on the decline in the United States. I 

think that one of the reasons, to be fair about this, is the rise of 

natural gas. Another reason is the rise of solar and other renewable forms of energy. That’s actually what’s happening with or 

without carbon sequestration. According to the U.S. Energy Information Administration, natural gas is projected to surpass coal as 

the leading source of energy for U.S. power generation this year. 

And there’s a shift to natural gas in the United States that has resulted in reduced greenhouse gas emissions, reduced pollution by 

carbon dioxide, if you will. 

And I should remind everybody that although natural gas is a 

cleaner source of fossil energy, it still emits a very large and substantial amount of carbon dioxide into our atmosphere, unlike renewables. 

It should be noted that coal and natural gas account for about 

65 percent of U.S. electricity generation together, and it’s possible 

that they may continue to be a major part of U.S. energy, particularly depending upon how fast renewables surge into that gap. 
9 

Nearly every activity within the Office of Fossil Energy is focused 

on climate disruption in one form or another and how that has 

brought about by fossil energy. I commend you for focusing on that, 

for focusing on matters of environmental mitigation because that’s 

a legitimate government role, and it is true that the Administration is proposing to cut that overall budget. 

In order to deliver on the emission targets agreed to in the Paris 

Climate Agreement and in the future, carbon capture technology 

likely will be needed in the United States as well as around the 

world, particularly in developing countries that rely continually, 

heavily on coal. According to the International Energy Agency, the 

world’s coal consumption is going up, not down, and since the start 

of the 21st century, coal production has been actually the fastestgrowing global energy source, particular in third-world countries. 

India is entering a period of sustained rapid growth, and its demand for cheap coal power generation is surging. China and Southeast Asia are major consumers of coal and continue to bring on new 

coal-fired power plants each year. And African countries still count 

on fossil fuels for 77 percent of their electricity production. 

Thus, the development of carbon capture technologies is crucial 

to the worldwide effort to reduce greenhouse gas emissions and 

keep our planet safe. The United States can lead this effort to solve 

this challenging technological problem through your research. We 

can, and should, capitalize on this unique environmental and economic opportunity. 

The Administration’s announcement of fossil energy technology 

innovation gave us all high hopes for transforming our energy economy, including the advancement of innovative carbon capture technologies like the ones they’re working on right now. But looking 

closer at the details, I realize that we may fall short of making any 

significant progress in reducing the environmental impact of fossil 

fuels through carbon pollution. 

I am hoping that this hearing provides a clearer explanation of 

the significant cuts within the Office of Fossil Energy’s Advanced 

Energy Systems program budget that have been proposed, among 

other areas. Also, I’d like to hear how DOE plans to better steward 

large demonstration and pilot projects going forward since I believe 

that they may well be necessary to meet our goals of reducing carbon pollution. I hope our conversation today can help to highlight 

some of these needed improvements, and I thank the chairman and 

the witness and yield back. 

[The prepared statement of Mr. Grayson follows:] 
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Chairman WEBER. I thank the gentleman. 

The Chair now recognizes the Chairman of the full Committee, 

Chairman Smith. 

Chairman SMITH. Thank you, Mr. Chairman. 

Today we will examine the Department of Energy Office of Fossil 

Energy’s research and development budget for coal, oil, and natural 

gas. 

The fossil energy research and development programs should advance technologies for the ‘‘reliable, efficient, affordable, and environmentally sound use of fossil fuels that are important to our nation’s security and economic prosperity’’ as is their stated mission. 

Like many of my colleagues, I share this commitment to the longterm use of our nation’s most abundant and affordable fuel source. 

Unfortunately, the Administration’s proposed budget for fossil 

energy research and development appears to be at odds with America’s energy resources and needs. As in past budget requests, the 

Obama Administration proposes to cut fossil energy R&D this time 

by $32 million. 

DOE apparently counts on Congress to increase funding for fossil 

energy every year, and I’m glad to see the House Appropriations 

Committee has proposed to restore funding for fossil energy R&D 

again this year. However, this lack of consistency is no way to 

manage a robust research and development program. 

While the Administration pays lip service to the important role 

of fossil fuels in a clean energy future, there are fundamental concerns with DOE’s approach to fossil energy R&D. DOE refuses to 

prioritize early-stage research and development for innovative fossil energy exploration and production technologies or research to 

develop and integrate technology to make coal-fired power plants 

more efficient. Instead, the Fossil Energy R&D program has become singularly focused on carbon dioxide management. 

DOE should expand access to America’s oil and gas resources, 

not use limited research dollars to help the EPA measure emissions. Unfortunately, fossil energy innovation does not appear to be 

a priority for this Administration. 

The fiscal year 2017 budget proposal also lacks transparency. 

The Administration proposes to eliminate funding by fuel type in 

the fossil R&D budget. It argues that this can streamline research 

for carbon capture and sequestration by coordinating coal and natural gas programs. While CCS for coal and natural gas power 

plants face similar technology challenges, the proposed restructuring masks how federal dollars are being spent. Congress appropriates funding by fuel type to avoid this problem. Coordination of 

research when appropriate can be cost-effective and save limited 

resources for research and development. But coordination cannot 

come at the expense of transparency. 

The budget proposal also lacks transparency regarding the Administration’s Mission Innovation initiative. This is the commitment made during the Paris climate change negotiations to double 

federal investment in clean energy research and development. According to the budget request, $564 million of the $600 million request for fossil energy R&D is for programs that support Mission 

Innovation. However, nowhere in the budget does DOE explain the 

purpose of Mission Innovation or the goals for fossil energy re-
13 

search and development conducted in support of the initiative. It 

should be clear to stakeholders, researchers, and Congress what 

the Department hopes to accomplish in fossil energy and across 

DOE. 

Finally, the Office of Fossil Energy has significant management 

challenges. Large demonstration projects have been poorly managed by the Department, with little transparency on project decisions until a public announcement of pooled funds. 

The Office of Fossil Energy should fairly enforce deadlines and 

work with companies to ensure projects can be successful. Instead, 

it appears the Office systematically ignores time and cost limits. 

This type of sloppy management doesn’t help companies that work 

with DOE to develop groundbreaking technology, and it certainly 

doesn’t benefit the taxpayer. 

Mr. Chairman, I want to thank our witness, Assistant Secretary 

Smith, for testifying today, and I look forward to a discussion about 

the direction and purpose of the fossil energy research programs at 

DOE. 

Finally, let me say that regrettably I have another committee 

that is starting a markup or started a markup 20 minutes ago, so 

I’m going to have to leave, but I hope to return. 

Thank you, Mr. Chairman, and I yield back. 

[The prepared statement of Chairman Smith follows:] 
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Chairman WEBER. Thank you, Mr. Chairman. 

The Chair now recognizes the Ranking Member of the full Committee, the gentlelady from Texas. 

Ms. JOHNSON. Thank you very much, Mr. Chairman, and let me 

express my appreciation to you and to the Ranking Member for 

holding this hearing. And I’d also like to thank Assistant Secretary 

Smith for being here today. 

The Department of Energy’s Office of Fossil Energy plays a critical role in developing technologies and best practices that minimize the environmental impact that we, and indeed the world, 

cause when we extract and use fossil fuel resources. 

While I’m also strongly in support of the Department’s efforts to 

advance renewables, energy efficiency, nuclear power, and other 

clean energy sources as quickly as possible, I recognize that we and 

our international partners are likely going to continue to use significant amounts of coal, natural gas, and oil to heat our homes 

and fuel our vehicles for decades to come. 

However, we can’t bury our heads in the sand if we are serious 

about tackling climate change. We can’t just focus on developing 

one set of energy sources, as promising as they are. We need to do 

all of them. 

This is why I was so excited about the announcement of Mission 

Innovation, a commitment that the President and leaders from 19 

other nations made to double their government-supported clean energy R&D investments over the next five years. This is exactly the 

kind of commitment we need to cover the full range of research and 

technology development activities required to sufficiently address 

the climate crisis. 

And yet, just a few months after Mission Innovation was announced, the Department proposed large cuts to or the outright 

elimination of a number of worthwhile programs carried out by Assistant Secretary Smith’s Office, with little justification for those 

cuts provided in the budget request. Examples include the elimination of the Carbon Use and Reuse program, a 78 percent cut to 

Gasification Systems, a 73 percent cut to fuel cell research, and a 

33 percent cut to the Advanced Turbines subprogram. 

All of these programs aim to make fossil energy systems cleaner 

and more efficient, which is consistent with the goals of Mission Innovation. So, Mr. Smith, I hope you can help us better understand 

the rationale behind these drastic cuts that have been made, despite an effort to double overall funding for clean energy R&D in 

the next five years. 

In addition, and we have discussed before, I would like you to 

provide this Committee with a clear explanation for the Department’s rather abrupt shift from support of the Texas Clean Energy 

Project through the end of the year to your proposal to reprogram 

the remaining, previously appropriated funds for it. Your timely response to the letter from the Texas delegation on this issue was 

helpful, as was my recent conversation with the Secretary. And the 

Inspector General report released two weeks ago on the project provided further context. However, questions remain regarding the 

process that the Administration followed to come to its decision. 

I certainly understand that sometimes new research projects are 

unsuccessful in meeting their initial goals, and difficult decisions 
17 

must be made to ensure that taxpayer dollars are used wisely. But 

this needs to be done in a clear and transparent fashion, with mutually understood milestones and clearly stated potential consequences for not achieving them. 

I look forward to working with you, Mr. Smith, and my colleagues on the Committee, to address these concerns and to ensure 

that you have the direction, tools, and resources you need to help 

ensure that we are using our abundant fossil energy resources as 

wisely and responsibly as possible. 

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

[The prepared statement of Ms. Johnson follows:] 
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Chairman WEBER. I thank the gentlelady. 

Let me introduce our witness today. Our witness today is the 

Honorable Chris Smith, Assistant Secretary for Fossil Energy at 

the U.S. Department of Energy. Prior to his confirmation in 2014, 

Assistant Secretary Smith served as Principal Deputy Assistant 

Secretary for Fossil Energy, and as Deputy Assistant Secretary for 

Oil and Natural Gas. Assistant Secretary Smith received his bachelor’s degree in engineering management from West Point and his 

MBA from Cambridge. 

I now recognize Assistant Secretary Smith for five minutes to 

present his testimony. Welcome, Chris. 

TESTIMONY OF HON. CHRISTOPHER SMITH, 

ASSISTANT SECRETARY FOR FOSSIL ENERGY, 

U.S. DEPARTMENT OF ENERGY 

Mr. SMITH. Thank you very much, Mr. Chairman, and it’s a 

pleasure to appear again before this Committee, so thank you very 

much for having me here today. 

Today we’re seeing new opportunities and challenges for our fossil energy resources. This was highlighted in the recent climate 

agreement in Paris. With the United States’ leadership, 190 countries submitted plans to reduce their carbon emissions to address 

climate change. COP–21 was an important first step but it was 

only a first step. The mandate coming out of Paris is that we must 

continue to innovate. 

That’s the idea behind Mission Innovation, a landmark international effort to double clean energy research and development 

over the next 5 years. 

Mr. Chairman, in the clean energy economy of the future, there 

will be those who build the technologies and there will be those 

who buy them. The United States must be a builder and a leader 

in this new economy. 

We have a leg up in this race. Innovation is something that we 

do well here in America and at the Department of Energy. 

The Department is primarily a research organization focused on 

developing clean energy technologies from wind to solar, from geothermal to nuclear, but one of the most important things that we 

are doing in our work is to enable the sustainable use of our coal 

and natural gas resources. That’s what we do through my Office of 

Research and Development program, and that’s the core of our contribution to Mission Innovation 

The President’s final budget emphasized the importance of this 

work with a $31 million increase in those core activities consistent 

with Mission Innovation, and through your funding, Congress also 

recognizes the importance of fossil energy research and development. 

This R&D includes in-house research at NETL, the National Energy Technology Laboratory, the only government-owned and government-operated laboratory in DOE where we are working with 

our partners to advance innovative technologies like CCS, advanced power systems to ensure the sustainable use of natural gas 

and coal. And just today we announced the selection of Penn State 

to establish and lead a new university coalition for fossil energy re-
21 

search, which will focus on the challenges to fossil energy-based 

technologies. 

I’d like to add that we’re also working with those communities 

that have been impacted by market pressures on coal including exploring commercial opportunities for extracting rare earth elements 

from coal. This is important to those communities and to the Nation since China is currently the dominant source for those materials. 

We also sponsor a portfolio of major demonstration projects 

which are critical to commercializing carbon capture utilization and 

storage. These projects along with our regional partnerships have 

stored nearly 12 million metric tons of CO2. As you know, however, the developments of any complicated innovative technology will face difficulties. Some projects won’t reach 

completion, and I have had the opportunity to talk with some of 

you about the Texas Clean Energy Project, but we’re also seeing 

real progress. 

For example, NRG’s Petra Nova 240-megawatt post-combustion 

project will begin full capacity operation next January. Southern 

Company’s Kemper project is preparing gas fires for the first lignite feed and syngas production and is scheduled for commercial 

startup by third quarter of this year. 

ADM’s industrial CCS project will achieve full CO2 injection rate 

by early 2017, and the Air Products project is expected to capture 

and store 3 million metric tons of CO2 by the summer. 

Going forward, we will soon select a 10-megawatt pilot project to 

test the next generation of carbon capture technologies. We also 

have the opportunity to strengthen our contribution to Mission Innovation. Our fiscal year 2017 budget proposes that an initiative 

that would build on FER&D advances to bring to market revolutionary methods and technologies that capture, use and store CO2

for power plants as well as from industrial sources. 

Fossil Energy research and development is also pursuing innovative ways to safely and sustainably develop our gas resources including gas hydrates. R&D includes well design and engineeringinduced seismicity and technologies to treat and produce waste for 

reuse. 

We’re also working to reduce methane leaks from our natural gas 

infrastructure. That’s why in the wake of Aliso Canyon we’ve 

partnered with the Department of Transportation on a new interagency task force on natural gas storage safety, the safety of integrity of the Nation’s natural gas infrastructure. 

We’re also collaborating with transportation to better understand 

and mitigate risks associated with the transportation of conventional and tight crude oils. 

Mr. Chairman, innovation is critical to meeting the challenges of 

climate change and the demands of a low-carbon future. The Department of Energy is committed to developing innovative fossil energy technologies to meet those challenges and secure U.S. leadership in the global clean energy economy. 

With that, I’d be happy to answer any questions that the Committee might have, and again, thank you for giving me the opportunity to appear here today. 

[The prepared statement of Mr. Smith follows:] 
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Chairman WEBER. Thank you, Mr. Smith. 

The Chair now recognizes himself for five minutes. 

In your opinion, Mr. Smith, what is the appropriate role of government in fossil energy research and development, and let me be 

specific. In other words, what is the right balance of investments 

between applied energy research versus the demonstration and 

commercialization of energy technologies for fossil energy? That is 

kind of a two-part question. Let me restate it. 

In your opinion, what is the appropriate role of government in 

fossil energy research and development? I’ll let you take that one 

first. 

Mr. SMITH. Okay. Well, thank you, Mr. Chairman, and that’s a 

big question. I mean, that’s the basis of our entire budget. 

So the role of my program is developing those clean energy technologies that are going to ensure that all forms of domestic energy 

are relevant in the economy of the future. The Department of Energy is a technological organization. It’s what we do. We develop 

technologies from wind to solar to enhanced geothermal to biofuels 

to nuclear. An important part of all of our goals be it innovation, 

job creation, energy securing, reducing greenhouse gas emissions, 

is to ensure that all forms of domestic energy remain relevant, and 

so the core of our program is carbon capture and sequestration 

technologies, ensuring that those technologies move forward so that 

all forms of energy are reliable and part of the future for us. 

Chairman WEBER. Well, let me say this. When you’re focusing 

on—and as you know, in my district, Port Arthur, Texas, with Air 

Products, the project that you and I were able to be there for the 

groundbreaking on a very good project, a lot of carbon sequestration captured and, you know, just the success of the project, do you 

remember, was that $460 million? 

Mr. SMITH. Of that order. 

Chairman WEBER. So something in that area. And they’ve captured, I think according to your statement, up to three million tons 

now of CO2? 

Mr. SMITH. Three million tons for that project. 

Chairman WEBER. What does that cost per ton if you divide that 

out? 

Mr. SMITH. We’d have to do the math on that, Mr. Chairman. 

Chairman WEBER. Four hundred and sixty million divided by 

three million tons. That’s a lot of millions of dollars per ton. 

It seems to me like what’s happening is, when you go focusing 

on carbon—CO2 capture, that it’s kind of like closing the barn door 

once the cow gets out because that’s on the back end of the energy 

chain, so to speak. You know, you’re using fossil fuel energy, which 

as we noted earlier, is 80 percent of the world’s energy consumption, or energy usage, rather, and I think they’re saying probably 

still as much as 40 percent by 2050. So when you focus on the back 

end of fossil fuel energy, doesn’t that take your focus away from innovation and technology on the front end? 

Mr. SMITH. Well, I’m not sure I agree with that characterization, 

Mr. Chairman. The important thing that we have to work on—and 

I agree with some of the statements you made in your opening 

statement about the importance of innovating, the importance of 

early-stage technology, the importance of pushing the envelope in 
33 

that way, and also agree very strongly with some things that the 

Ranking Member mentioned in his technology that the challenge of 

these projects is not the technology per se but it’s some of the commercial issues around pushing forward and improving these technologies and doing the demonstrations, an environment in which 

it’s free for companies to emit as much CO2 as they want to in the 

environment. You don’t have to pay for that. So there’s not a way 

for companies to capture the very strong positive externalities that 

you get from capturing that CO2. Therefore, we have to work with industry to make sure that 

we’re doing demonstrations like the one we’ve done in your district 

that you and I got to do the groundbreaking on. It’s important to 

show and demonstrate that those technologies are available, that 

they work, that you get real projects built so that coal and natural 

gas can continue to be part of our energy mix. 

Chairman WEBER. But in all fairness, Mr. Smith, when you look at that project, $460 million, 60 percent of it was paid for by the 

American Reinvestment and Recovery Act, if I remember, so I don’t 

know what that math is, but—and it was a great project and a 

great plan in our district and it led to a lot of jobs, but realistically 

speaking, DOE, in my opinion, their—your focus needs to be on improving that energy efficiency, not on capturing what’s considered 

by some to be on the back end, you know, undesirable energy, a 

fuel, and so when you focus on capturing the emissions, if you will, 

on the back side, you’re reducing your ability to actually focus on 

innovating on the front end, and no project—I mean, I don’t think 

any project can be built with 100 percent free market business 

money because when the government provided 60 percent of that 

money to that project, of course it could be built, but I don’t think 

you can duplicate that. 

Mr. SMITH. Well, again, Mr. Chairman, in this current market, 

that’s necessary because it’s free to emit as much carbon pollution 

to the environment as you want to. I mean, the optimal thing for 

a company to do is to run their plant and just put that pollution 

into the environment because it doesn’t cost anything. 

Chairman WEBER. Well, I want to respectfully disagree, and I’m 

running over here because, you know, we live in our districts. I 

represent the Gulf Coast of Texas, five ports, more than any other 

Member of Congress. Sixty percent of the nation’s jet fuel is produced in our district. It’s almost 20 percent of the nation’s gasoline 

east of the Rockies, so a lot of energy production, and those of us 

who live and work there, we want clean air for our kids and clean 

air and clean water. We just do. And those industries do too and 

the communities do too, and they strive to be as clean as possible. 

But we could go on for a long time here, and I appreciate you 

being here, and I’m way over my time, so I’m going to yield now 

for questions to the Ranking Member of the whole Committee, Mrs. 

Johnson. 

Ms. JOHNSON. Well, thank you. I didn’t realize I’d be called out 

of order. 

Mr. Smith, roughly how much of the Fossil Fuel Energy R&D 

budget would you consider to be relevant to climate mitigation, 

both domestically and if we can export these technologies around 

the world? And in the context of Mission Innovation, how does it 
34 

make sense for so many of these programs to receive such significant cuts or be eliminated entirely? 

Mr. SMITH. Thank you very much for the question. So if you look 

at our entire $600 million budget request, I’d characterize the vast 

majority of those projects being relevant to reducing greenhouse 

gas emissions and promoting cleaner energy. The core of our program is the carbon capture and sequestration efforts, capturing 

CO2 out of power systems, out of industrial sources, capturing that 

CO2 and storing it over—permanently so that CO2 does not go into 

the environment. 

In the Oil and Gas program, we’re focused on environmental sustainability and safety, so I’d say overall if you look at our budget, 

the overwhelmingly vast majority of the work that we do is very 

much relevant to the challenge of the clean energy economy of the 

future. 

In terms of our budget, our budget is consistent with the idea of 

Mission Innovation, which is doubling of clean energy R&D over 

the next five years, and in fact, we’ve got a core of our program 

that is directly relevant to the challenge of Mission Innovation. 

That core has been increased from $533 million to $564 million, so 

that’s a $31 million increase. At the same time, we’ve had some 

successes in our program and we’re rolling off of certain efforts 

which allow us to gain some efficiencies. 

For example, in our carbon storage program, we’re moving from 

the injection phase in some of our major regional partnerships to 

long-term monitoring and verification. That is a less costly phase 

of that research. It’s just as important but less costly, and what it 

allows us to do is, you know, in an environment of very challenging 

budgets for us to reduce funding in some areas as we make some 

advances or as some of the technologies become less relevant and 

focus those funds on areas that we think are going to be particularly relevant for the types of topics that are going to be important 

for Mission Innovation early TRL-level research and development 

that is going to be truly transformational in reducing the costs for 

capturing CO2. 

Ms. JOHNSON. Hypothetically, if the Department’s request for 

$1.6 billion of additional so-called mandatory spending for clean energy research is authorized during this Congress, would it make 

sense for Fossil R&D to receive some of the additional funding? 

Mr. SMITH. Well, indeed, Congresswoman, again, the core of our 

program, we actually are increasing and that’s something that we’d 

like to—you know, we’d be happy to detail in more granularity but 

we’ve added additional $31 million to those core programs that are 

relevant to Mission Innovation, and over time since—you know, I 

came into this role back in 2013 so the 2014 budget was the budget 

that I—you know, my first budget I got to work on, which was an 

R&D budget of about $430 million, and that has increased by 40 

percent, you know, since the fiscal year 2014 request to this year 

of $600 million. 

So again, in an environment of tremendously challenging budget 

pressures, I think our recognition of the importance of this challenge has increased as has our budget request and the successes 

that we are having in some of our programs. 
35 

Ms. JOHNSON. Well, considering that fossil fuel energy generates 

over 60 percent of our electricity, don’t you think it would be wise 

to at least a fraction of that proposed increase and put it toward 

technology development and demonstration efforts to reduce environmental impacts of coal and natural gas, or even mission-driven 

basic research that could be handed off to industry when applicable? 

Mr. SMITH. So our materials programs are and remain very important, everything from advanced computational efforts through 

our major demonstrations. We’ve got a very wide range of programs 

that are doing the early phase research and development on the 

transformational technologies like chemical looping and pressurized 

oxy-combustion all the way through the major demonstrations, 

which we are working very intently with our collaborators to move 

forward and be successful with. So again, I concur with your observation that these technologies are important, and indeed, I think 

that we’re putting the right effort into them. 

Ms. JOHNSON. Thank you. I yield back. Time has expired. 

Chairman WEBER. I thank the gentlelady. 

The gentleman from California is recognized for five minutes. 

Mr. ROHRABACHER. Thank you very much, Mr. Chairman. 

Let me just note that I think that the premise that we’re operating on in this hearing is just wrong. I think it started right with 

Mr. Grayson, whose opinions I deeply respect but disagree with, 

when he said that this is all about air pollution, and CO2—it’s 

about CO2. It’s not about air pollution. Pollution by the definition 

of most—not most but many very prominent scientists is something 

that endangers human life, endangers the health of human beings. 

What we have here and the hundreds of millions of dollars if not 

billions of dollars that we are talking about is all based on the idea 

that CO2 is heating our planet, and this theory, which we have to 

understand, pushing this theory, this Administration is basically 

by doing—putting such an emphasis on it, being willing to sign 

agreements that put enormous power in the hands of global decision makers instead of just American decision makers as well as 

have tremendous impact on jobs, especially in the coal industry 

where we’re talking about tens of thousands of jobs that are being 

lost, and I’m very happy to hear we’re trying to do something to 

help them come through a crisis when men and women who have 

earned a living and supported their families are now just being 

thrown out because of a theory, and I say the ‘‘theory’’ because 

there are hundreds of scientists who do not believe that the global 

warming theory based on CO2 that is heating our planet is correct, 

whether it’s Dr. Freeman Dyson of Cornell or William Happer of 

Princeton, those are just two of hundreds of scientists who just disagree, and it seems to me what we’ve got here when we’re talking 

about the money that’s being spent and the shift—forcibly shifting 

a reliance from coal to natural gas and to wind and solar, et cetera, 

is running roughshod basically over the livelihood and the wellbeing of many American working people, and I—can you—I guess 

you’re not the one to explain global warming, the global warming 

theory, but when we’re talking about CO2 reduction, what are the 

other benefits that you can see that justify this enormous ex-
36 

pense—how do you say—dislocation of our economy in order to accomplish these goals? 

Is there anything else but—somebody says air pollution. I don’t 

accept the fact that CO2 in any way causes human health problems. Air pollution to me is worth trying to do some things to try 

to protect health. There’s no doubt about that, but trying to basically fulfill this—base our operations on the CO2 theory of global 

warming I don’t believe is justified. Maybe you could tell us what 

else besides global warming is being benefited by these expensive 

and dramatic changes that you’re involved in. 

Mr. SMITH. Well, thank you very much, Congressman, for the 

question. So there’s a lot there in that question. 

So maybe I’ll refer back to COP–21, the global climate event late 

last year. I went into COP–21 with the expectation that maybe 60, 

maybe 70, maybe 50 countries would put forth INDCs, their Initial 

National Determined Contributions, real steps that countries are 

going to take in order to reduce greenhouse gas emissions. With 

U.S. leadership we ended up with 190 countries, 190 countries, essentially all the participating countries, made specific commitments 

to address climate change, to address anthropogenic CO2, a remarkable outcome. I mean, it’s remarkable to get 190 countries to 

agree to anything, much less something as difficult to address as 

this, as fundamental as it is to our ideas around energy security, 

and indeed, something that you actually have to take steps to address. You know, 190 countries led by the United States. And so 

in terms of an emerging consensus, I mean, there’s an emerged scientific consensus around this existential need to address carbon 

pollution—— 

Mr. ROHRABACHER. So it’s all based on the CO2 theory then? 

There’s other things, and you’re talking about CO2. Let me ask, 

does CO2—is there an indication—I was—I just visited some hothouses where they’re growing different vegetables and plants, and 

I noted that they were pumping CO2 into these hothouses to grow 

plants that would have a greater production of food. Even here in 

our own country we do that. If we are reducing the CO2 in the atmosphere, is that also going to result in a lower production of food? 

Mr. SMITH. So—— 

Mr. ROHRABACHER. I mean, all these people have a consensus 

about air pollution. Is there a side impact as well beside the dislocation of people’s jobs that there’d be less food produced in the 

world? 

Mr. SMITH. We actually—we’re looking at beneficial uses of CO2

that include taking CO2 for algae production, so there are useful 

things that you can do with CO2, and that has been part of our program. It’s been part of the EERE’s program that looks at renewable 

energy. So there certainly are beneficial uses of anthropogenic CO2, 

but overall, there is an enormous challenging of reducing greenhouse gas emissions so that we can get the climate to sustainable 

levels. That’s the core of our program. That’s the reason why we 

are working on—— 

Mr. ROHRABACHER. Honest people can disagree with that, so 

thank you. 

Mr. SMITH. And I did want to address this idea of forcibly shifting from coal, and I’ve spent—you know, I’ve spent a lot of time 
37 

in coal-producing countries. I’ve spent some time with the governor 

in West Virginia. We had a laboratory that’s based in Morgantown, 

West Virginia, a National Energy Technology Laboratory. Coal 

country is under tremendous pressures but they are market forces 

which are impacting coal. You have trillions and trillions of cubic 

feet of natural gas that are available and at commercial quantities 

that were not available years ago, and that reduction in the price 

of natural gas has put a tremendous pressure on coal that along 

with the need to greenhouse gas emissions, so I’d say that the program—you know, our efforts within the Office of Natural Gas within the Office of Fossil Energy are to ensure that all forms of energy 

remain relevant. 

Chairman WEBER. We do need to move on. I appreciate that. 

The Chair now recognizes the Ranking Member for five minutes. 

Mr. GRAYSON. Thank you. 

Regarding my friend from California and what he just said, if he 

thinks that carbon dioxide doesn’t cause any human health problems, I’d invite him to put a plastic bag over his head, tie it tightly 

around his neck, and see what happens next. He says they’re always trying to do that to him anyway. 

Mr. Smith, tell me your sense of what the term ‘‘corporate welfare’’ means. 

Mr. SMITH. I would demur from offering a definition, Mr. Chairman. Is that a question—or Mr. Ranking Member, is that a question in reference to our program or—— 

Mr. GRAYSON. I’d like to know—well, it’s a question. I’d like to 

know whether you think that anything that could be conceived of 

as corporate welfare is properly a function of your office. 

Mr. SMITH. So the function of our office is to make sure that we 

are moving forward and deploying technologies that will be necessary for the clean energy economy of the future, and that’s what 

we do, and in order to do that we have to work together with industry, work together with academia, work together with our network of national laboratories. It’s important for us to have corporate partners because that’s the way that you push innovation to 

the marketplace, and that’s what we do. 

Mr. GRAYSON. Well, would you want to see in your office, for in- stance, $100 million effort to try to improve fracking technology? 

And if not, why not? 

Mr. SMITH. Well, early on we did have a major effort for hydraulic fracturing. I mean, the very first horizontal—— 

Mr. GRAYSON. I’m talking about today. 

Mr. SMITH. Well, the nature of our program is, for us, a success 

is something where you have an early-stage investment where the 

government innovates. We create—we put out data and results and 

outcomes that companies can then subsequently come in and invest 

in, and so we’re certainly way down the path in terms of hydraulic 

fracturing. I mean, I came from Chevron. That’s where I was before 

I came to government. Companies do this very well. I don’t see a 

government role in helping companies do things that there’s already a commercial motivation to move forward on. 

Mr. GRAYSON. Do you happen to know what Exxon’s annual research and development budget is? 

Mr. SMITH. I don’t know off the top of my head. 
38 

Mr. GRAYSON. It’s actually bigger than yours. It’s a billion dollars 

a year, and it’s been a billion dollars every year for the past 5 

years. 

So do you think there’s some need to try to make sure that your 

office is not doing in a duplicative way at the expense of the taxpayers the same work that a company like Exxon would be doing? 

Mr. SMITH. We very specifically do exactly that. 

Mr. GRAYSON. All right. Explain to me how you do that. 

Mr. SMITH. Well, so we’re constantly in conversation with the 

market, with market players. They’re our partners in a lot of these 

efforts. We know where they are in terms of be it extractive technologies for natural gas or technologies to commercialize carbon 

capture, for example. So, you know, we’re in touch with the market. We see where the market’s going. We monitor market forces. 

We understand what investment is being put in place, and we have 

to identify those scientific challenges that absent an active government role would not be filled and which have an important impact 

on the public good. That’s basically our annual budget process. 

Mr. GRAYSON. And by ‘‘important impact on the public good,’’ you 

mean what you and I were both referring to earlier, this idea that 

pollution is an externality, that companies have no incentives to 

deal with it unless we create an incentive, and if we don’t create 

an incentive, then it’s incumbent upon the government to promote 

research and sometimes even regulate in order to take care of the 

effects of that externality? In fact, you used the phrase earlier 

‘‘positive externalities that you get from capturing CO2.’’ That was 

your phrase, not mine. What did you mean by that? 

Mr. SMITH. So if you capture that CO2 and you store it instead 

of pumping it into the environment, that—you know, that avoided 

emissions has a definite benefit, and right now the market doesn’t 

pay companies for that. If you’re an emitter, you can emit as much 

CO2 as you want to and you don’t get charged for doing that. 

So there is a positive benefit to reducing emissions. In fact, our 

program is approaching 12 million tons of CO2 that we’ve stored 

through our R&D efforts and through our major demonstrations. 

That’s an enormous benefit. I mean, that is a positive thing. Right 

now companies can’t reap that benefit and therefore you have to 

find other creative ways to make sure that these projects get built 

that technologies continue to advance. Otherwise companies aren’t 

going to work on these things, and we think that they’re important. 

Mr. GRAYSON. You’re developing ways to sequester CO2, the actual know-how, how to do that, that’s what you’re doing in your office. What’s the next step after that? Once you’re successful, what’s 

the next step after that? 

Mr. SMITH. Well, I mean, the challenge that we have is continuing to advance new systems that lower cost, that fundamentally change the way that we combust hydrocarbons, the way we 

capture CO2. So, you know, two other projects that we’re looking 

at kind of going forward for new pilots would be pressurized oxycombustion using oxygen to combust the coal and therefore you get 

a very concentrated stream of water vapor and then CO2 in the 

back end so you don’t have to capture the CO2. That’s kind of 

precaptured. 
39 

The second thing we’re working on is chemical looping, which is 

another novel way of combusting CO2 that you end up with a very 

pure stream of—combusting carbon so you get a very pure stream 

of CO2. Those are systems that, you know, need further research. They 

need further development. They need to be investigated at the pilot 

scale but could take an enormous stride toward reducing the cost 

of capture and ensuring that all forms including coal remain relevant in the economy of the future. 

Mr. GRAYSON. But here’s my point. You’re not just doing this for 

the sake of advancing scientific knowledge; you’re doing this so 

that we can actually sequester carbon on a large scale and reduce 

pollution, correct? 

Mr. SMITH. That is correct. 

Mr. GRAYSON. Thank you. I yield back. 

Mr. KNIGHT. [Presiding] Thank you very much. 

And I will take the next set of questions. First I want to thank 

the Secretary for coming out to Southern California and to Aliso 

Canyon, not that it’s hard to come out to Southern California, but 

I appreciate him coming out and having the hearing, and it was 

one of the biggest incidents of the year without a doubt, and so my 

first—all of my questions will be around Aliso Canyon and around 

the gas leak that plagued our district for 118 days and continues 

to have serious issues. 

Can you tell me what the connection is to the states? In certain 

states we have—like in California, we have the CPUC. We obviously have the Governor’s Office that does an awful lot of these 

types of regulations and issues and then we have CARB and I 

could go on and on, and I’m sure everyone’s state could go on and 

on, so can you tell me from the DOE what their connection is, what 

their stance is on connecting with the states in reducing and the 

regulations that come out of the states? 

Mr. SMITH. Well, thank you for the question. So we’re the technical organization. You know, we do research and development. 

We’ve got a tremendous resource with the network of national laboratories, you know, thousands and thousands of researchers and 

scientists and engineers that cover the gamut of scientific knowledge, much of which is relevant to challenges like this. So our primary role at the Department of Energy, we’re not the regulators, 

you know, that’s not our job. However, we do have a very deep scientific bench that is really relevant to states, local and federal authorities when it comes to understanding risks, understanding how 

to mitigate risks, quantifying concerns, helping local and state entities come up with plans for mitigating those risks. We think we’re 

an important resource. And indeed, much of the research and development that we do is geared towards quantifying concerns that 

the communities have around the long-term safety and sustainability of our fossil energy systems. We think that’s an important 

mission that we have and one that we look for opportunities to 

work with state authorities. 

Mr. KNIGHT. Absolutely. I understand the regulatory issues and 

who is in charge of what, but can you tell me—in other words, if 

it wasn’t an emergency, would you be reaching out to some of these 

states to do some of these areas that have these types of issues 
40 

that do high-energy output, that do underground piping, that do 

these types of things that can be dangerous, and we’ve been doing 

them for 70 or 80 years, and we’ve learned an awful lot. Are you 

reaching out to those groups and giving them your expertise and 

maybe working on some of those issues so that when they do regulations they’re effective regulations and the industry is able to continue on with the regulation? 

Mr. SMITH. Indeed, Congressman. I mean, we have numerous 

interactions with everything from the Southern State Energy 

Board to the American Association of Petroleum Geologists. We 

have ongoing conversations with state geologists throughout the 

United States. I mean, there’s myriad entities that we work with 

to—and that communication goes two ways. I mean, we get great 

inputs from states in terms of things that they’re learning and 

their processes that would help us shape our research and development program, and then we also look for opportunities to share 

things that we’re learning so that states can be more effective regulators. 

States of course—again, we’re not the regulators. States are covetous us with their regulatory autonomy, which I think is important. But at the same time, every state—well, states have different 

concerns but a lot of them are similar, and a lot of things that 

states are concerned with are the very issues that we are investigating within the Office of Fossil Energy, with the National Energy Technology Laboratory. So indeed, I look for—I look forward 

to having further opportunities to collaborate with the State of 

California and with other entities throughout the United States on 

these important issues. 

Mr. KNIGHT. And very quickly, so we’ve seen the PIPES Act that 

has moved through for underground piping, and there’s been an 

amendment that has been kind of to put a regulation across the 

board in the federal government so that states are not doing—one 

is doing this, one state is doing this, one state is doing this. How 

would you feel as—is that a good—is that a good line in the sand 

to say that the federal government should be doing that or should 

we allow the states to just do whatever you want and there’s no 

federal regulation? 

Mr. SMITH. Well, Congressman, I’m not familiar enough with the 

amendment to speak specifically to that particular amendment or 

to that piece of proposed legislation, but certainly there is a balance to be drawn, and again, we’re not the regulator but, you 

know, whatever entity is in charge of putting in place rules or promulgating those rules, the Department of Energy would look for 

opportunities to collaborate to make sure that rules are put in 

place to represent commonsense regulation that’s consistent with 

science and the quantified risk that we worked on. 

Mr. KNIGHT. Very good. Thank you very much. 

And I’ll recognize the distinguished gentleman from Colorado. 

Mr. PERLMUTTER. Thank you, Mr. Chair. 

Mr. Secretary, thanks for being here. I’ve just—you know, listening to this conversation and representing the suburbs of Denver 

where we have a lot of activity in the environmental community, 

obviously have substantial production of oil and gas and we have 

coal in our state, so it’s a combination of things, and you know, 
41 

there are some in my state that would completely do away with 

any fossil-fuel production whatsoever because they believe with everything in their soul that that’s causing the planet to warm and 

could, you know, lead to the extinction of all of us. Then there are 

those that are in the industry saying—some who say well, you 

know what, we’re going to produce, we have a very reliable energy 

sources here whether it’s oil and gas or coal, and we’re going to just 

produce, and I want to compliment you and DOE for trying to find 

a way that uses innovation, imagination, invention to take a plentiful energy source that we have and yet recognize the environmental problems that it may be causing, and so you know, thank 

you for that. I’m glad to see you all play a role in trying to take 

the brains that we have and find a way to make these things work 

without damaging the planet. 

But my questions are on the Strategic Petroleum Reserve, okay? 

And one of the things that we’ve seen—and I used to be a bankruptcy lawyer and I cut my teeth on oil and gas bankruptcies, and 

we watched the Saudis, who can produce at a much lower price 

than we can, you know, back in the day drop it from 30 bucks a 

barrel to 7 bucks a barrel. We’ve watched them now pump into 

lower demand type of economy, take it from 107 bucks a barrel 

down to 30, and now we’re at around 40, 45. And I know DOE 

plays some—has some role with respect to the Strategic Petroleum 

Reserves, which Congress has tapped to help fund a couple of items 

out there, whether it’s some of our transportation, our budget generally. Can you explain to us—and maybe it’s not within your jurisdiction of your department within DOE but can you explain to us 

how DOE analyzes, you know, when we fill up the Strategic Petroleum Reserve, when we draw down on it? I mean, is that a question that you’re comfortable with? 

Mr. SMITH. Thank you, Congressman. So the—you know, as you 

know, oil prices are very volatile. In the 1998 time frame, we’re 

looking at $18, $20 prices. Ten years later in 2008, we were up to 

$140. Oil prices subsequently crashed down to the 20s and are now 

back up to the 40s, you know, 44, 45. So a remarkably volatile commodity for something upon which our entire economy relies. I 

mean, the overwhelmingly vast majority of miles that Americans 

travel are fueled by oil. So we still have a very important strategic 

link back to oil and our economy has a very high level of vulnerability to spiking oil prices. We are importing fewer barrels than— 

we import fewer barrels from other countries than we produce domestically for the first time in decades, which I think is—you 

know, it’s a tremendous step forward. It reduces our reliance, helps 

us balance the trade and job creation. I mean, I think those are all 

positive things. 

But the Strategic Petroleum Reserve remains very relevant. I 

think we still definitely need this reserve to protect our economy. 

It’s the one thing that we have to protect us against price spikes. 

The global markets are well supplied now as we see from the lower 

oil prices but it’s still a very uncertain world so the reserve remains important. 

We’ve been instructed to sell barrels, you know, both through the 

bipartisan Budget Act and the Transportation Act. You know, on 

the Executive Branch, we execute the law as passed by Congress 
42 

so we will operate consistent with the spirit and letter of that law. 

One positive thing that we get out of that is that about $2 billion 

that will be go back into the modernization of the Strategic Petroleum Reserve to make sure that that reserve remains ready and 

that we have facilities to push incremental barrels out to the market in a way that protects our economy. So we’re going to execute 

that mission in a way that’s positive for this SPRO. 

Mr. PERLMUTTER. And I just hope that you buy low and sell high. 

Thank you. 

With that, I’ll yield back to the Chair. 

Chairman WEBER. So you were a stock trader as well as a lawyer? 

The Chair now recognizes the gentleman from Texas, Mr. Neugebauer. 

Mr. NEUGEBAUER. Thank you, Mr. Chairman. 

Secretary Smith, thank you for being here. In your prepared testimony, you discussed the DOE’s ongoing research and development in the carbon storage focused primarily on the permanent geological storage of captured CO2 from fossil fuel systems. But in 

your testimony there’s no mention of putting the captured CO2 to 

use in enhanced oil recovery. 

Similarly, the entire fiscal year 2017 budget proposal mentions 

enhanced oil recovery only twice in the context of past projects. 

Given the potential for cost-effective carbon storage, can you explain why facilitating EOR is not included in a major part of the 

DOE’s carbon storage program? 

Mr. SMITH. Thank you very much for the question, Congressman, 

and it’s actually a really good one. 

So as we look at the necessity to get these projects moved forward and built, enhanced oil recovery is I think as important as 

it has ever been in terms of incentivizing these projects. If you take 

that CO2, you capture it, you put it into a pipeline and use it to 

produce an incremental barrel that otherwise would have remained 

in the ground, you can take that value and use it to pay for the 

project itself. In fact, we’ve got a major demonstration in the State 

of Texas just south of Houston, the Petra Nova Project with NRG, 

that’s doing exactly that. It’s a 240-megawatt project that’s using 

enhanced oil recovery, and the total in economics of the recovered 

barrels are important for the overall project economics. 

Now, when it comes to research, I don’t see a direct R&D role 

for the Department of Energy in terms of enhanced oil recovery. In 

fact, that’s something that industry has been doing for decades and 

does very well. Now, as a methodology for taking that CO2 and putting it to beneficial use, I think that is tremendously important. 

One thing that we have proposed are tax credits for sequestration so that there would be a tax credit that you’d receive for oil 

that goes into EOR. We think that’s important to incentivize the 

activity to push those projects forward. In terms of an R&D role, 

that has not been in our program simply because there’s a very, 

very strong commercial drive for private industry to put research 

and development and activities and capital into that area. In fact, 

industry’s gotten a lot better at it. 

Mr. NEUGEBAUER. So your focus then for your research is just 

cost-effective storage and not necessarily looking at alternatives? I 
43 

mean, the enhanced oil recovery and use of the CO2 for enhanced 

oil recovery has been a very good thing for the oil industry, and according to you is good for the environment as well. So if we’re not 

focusing—if we’re focusing on storage, then why are we not focusing more on if it works in the oil industry, it might work in other 

areas? 

Mr. SMITH. Well, I mean, it comes back to a question I had earlier, I believe from Mr. Grayson, about how we think about where 

we invest. You know, we’ve got finite dollars, we’ve got a limited 

budget, so where do we focus those dollars? We want to focus those 

dollars on areas that have a benefit to the taxpayer, have a benefit 

to the Nation in terms of energy security, job creation and the environment, but are areas in which industry will not invest in itself 

that but for the involvement of the government that this research 

wouldn’t occur. So when we look at saline aquifers, for example, 

that’s certainly an area in which we think that we do have to put 

a lot of effort. Otherwise companies are lining up to do that research and development right now simply because it’s free to emit 

the carbon dioxide. 

Enhanced oil recovery, we think there’s an enormous driver to invest in that research and development. In fact, we see companies 

doing that. So most of the R&D that we do is going to be focused 

on saline aquifer. 

We will say that the major demonstrations, however, are using 

enhanced oil recovery as their disposal method simply because it’s 

positive for the economics of the project. So we’re getting—you 

know, we’re getting some bang for our buck in terms of 

incentivizing EOR projects but it’s not a focus for our research, 

again, simply because it’s something that the private sector is running pretty hard on. 

Mr. NEUGEBAUER. Mr. Chairman, I yield back. 

Chairman WEBER. I thank the gentleman. 

The Chair recognizes Eric Swalwell from California for five minutes. 

Mr. SWALWELL. Thank you, Chair, and thank you, Assistant Secretary Smith. 

I’m interested in your testimony with respect to rare earth elements. I had a bill last year that received an overwhelming majority of support in the House of Representatives to have the Department of Energy play a critical role in finding mines in this country 

where we could harvest these elements which, as you know, are 

used to make jet engines, cell phones, laptops, anti-missile systems 

and the like. However, because you needed two-thirds under that 

procedural vote, it did not pass. I’m still hopeful that our Chairman 

Lamar Smith, who supported the bill, and Majority Leader McCarthy, who also supported this bipartisan bill, will bring it back. 

But in your testimony, you referred to the National Energy Laboratory researching the feasibility of extracting rare earth elements 

from coal and coal byproducts. In March, nine projects were selected to look into this topic. I appreciate that you are working on 

this, and I wanted to know if you could give us an update on what 

is the current state of the nine projects selected in March, and 

what—which rare earth elements do each of these projects hope to 

harness? When do you expect results? 
44 

Mr. SMITH. Thank you very much for the question. So this is— 

this is a project that we’ve got some enthusiasm for and that we’re 

pushing forward on. We’ve already had some really interesting results in terms of increasing our understanding of the occurrence of 

rare earth elements, not only in geologic settings where you’d have 

some mining challenges but also in tailings that come out of the 

coal-mining process and also in coal ash. So we’ve done some work. 

The NETL is really publishing some groundbreaking papers. We’re 

increasing our understanding of areas in which we might be able 

to find rare earth elements in commercial concentrations that as 

you know might reduce the reliance of the United States on importing some of these important elements from overseas, primarily 

from China. 

Mr. SWALWELL. And would this require burning the coal? 

Mr. SMITH. Well, in some cases of it, if you’re looking at coal ash, 

I mean, what you essentially have are some kind of pre-combusted, 

pre-pulverized mass that then helps you in terms of recovering the 

rare earth element. We see some promise there. We also see some 

promise in tailings kind of in the pre—in the mined residue that 

you get out of the mining process, and we also see some potential 

in going out and extracting it in mining operations of directly—that 

are geared towards recovering rare earth elements, and you know, 

part of our research is going to be exactly how do you extract elements. That’s kind of the core, how do you—the core of our research. That’s really the heart of the scientific inquiry that we’re 

putting forth presently. 

So the—you mentioned I think we have eight or nine solicitations 

that are in the process of being awarded or they’re right at the 

award stage now, so over the course of this year I think we’ll know 

a lot more about the results from that work but we’ve already published some work that helps us understand the potential, the commercial potential for rare earth elements, and again, it’s something 

that in coal-producing countries—coal-producing parts of the 

United States that have been negatively and adversely impacted by 

reduction in coal use. This is something that has some promise for 

bringing some economic activity to those areas. 

Mr. SWALWELL. Great. Thank you. I yield back. 

Chairman WEBER. I thank the gentleman. 

Mr. Loudermilk, you are recognized for five minutes. 

Mr. LOUDERMILK. Thank you, Mr. Chairman, Mr. Smith, for 

being here. 

Secretary Moniz regularly states that innovation is one of the 

most important aspects of advancing energy technology. However, 

it’s very clean that the Clean Power Plan will devastate the coal 

industry. My question is, is this the right way to innovate to actually harm an entire industry so others would prosper, or wouldn’t 

we be better served investing more in fossil energy research and 

technology development than trying to regulate our way to success? 

Mr. SMITH. Well, thank you for the question, Congressman, and 

this kind of steers us back to a point we’ve had an opportunity to 

discuss a couple times in this hearing. It’s difficult to push forward 

with some of these clean energy technologies when it’s free to emit 

as much carbon pollution as you want to. What the Clean Power 

Plan does is provide some incentives for—you know, some man-
45 

dates and incentives for states to reach certain predetermined levels of CO2 emissions, and it’s an all-of-the-above approach. You can 

meet those targets using whatever methodology one chooses, be it 

wind or solar or nuclear, or in the case of the part of the technology 

that I’m working on, carbon capture and sequestration to reduce 

greenhouse gas emissions coming out of industrial sources and out 

of power sources. 

So we believe it’s very important that, you know, under the 

Clean Power Plan that states will have the option of continuing to 

use domestically produced sources of fossil energy including oil and 

natural gas and that we’re developing those technologies to make 

sure that there are cost-effective ways of capturing CO2 out of 

those sources. 

Mr. LOUDERMILK. Another question. The Energy Information Administration recently reported that coal dropped to 29 percent of 

the U.S. utility scale power generation down from almost 38 percent last year. At the current rate of regulatory impact, aren’t the 

coal research and development programs at DOE going to be too 

little, too late? 

Mr. SMITH. Well, I mean, we’re seeing natural gas prices down at $2.15, I think, today, so you’re seeing very low natural gas 

prices. They’ve gone down, you know, beneath $2, and this was, 

you know, when I was in the industry not too long ago and, you 

know, we were seeing close to double-digit natural gas prices. That 

has a big impact on decisions that electricity power generators 

make in terms of how they dispatch electricity. It’s been a real 

challenge for coal country. It will continue to be a real challenge. 

But what we have to work on—I mean, that’s a market force that 

we’re not going to be able to unwind, and I’m not going to make 

any predictions about the future of commodity prices. I mean, natural gas prices are also involved, and I don’t think we can count 

on any particular price or any particular position in the dispatch 

curve of various forms of power generation but what we do have 

to do is make sure that we’re continuing to innovate on technologies to reduce greenhouse gas emissions out of all sources of 

energy. 

So we try not to chase a commodity curve. I mean, we can’t say 

well, a price is a certain place and so therefore we’re going to stop 

research and development program. The challenges remain the 

same, and so we want to give some certainty to our researchers, 

and you know, the road is long in this area. 

Mr. LOUDERMILK. And you mentioned the inexpensive natural 

gas production, and since 2010, according to the Sierra Club, we’ve 

lost about a third of the country’s coal capacity that’s been shut 

down because of the regulations of the EPA. But we’ve been able 

to avoid spikes in electricity costs because of the cheap natural gas. 

Would you agree that the electricity rates would have spiked much 

higher after those coal shutdowns if it wasn’t for fracking and the 

cheap natural gas? 

Mr. SMITH. Well, I mean, first I’d challenge the characterization 

that coal is being challenged by EPA regulations and that’s the 

cause of the challenges around coal. I just don’t think that’s correct. 

I mean, market forces have had an enormous impact on coal and 

it’s been driven by the trillions and trillions of cubic feet of natural 
46 

gas that are available now that weren’t available ten years ago. 

But—— 

Mr. LOUDERMILK. In Georgia, we had three coal plants shut 

down because of EPA regulations, but you’re saying that EPA regulation hasn’t had an effect on coal production? 

Mr. SMITH. I’m saying that the major effect—the major challenge 

that coal faces is the fact that natural gas prices are $2 and they’re 

not $10, and that has a big impact on the way that power generators decide to build plants. I mean, but to your question, I think 

that the advances around hydraulic fracturing, advances around 

horizontal laterals, our ability to extract shale gas out of shale formations has been tremendously positive for the United States. 

We’re going to be net exporters of liquefied natural gas. When I 

last saw the Chairman, we were down in Savine passing the very 

first LNG export terminal that I worked on when it was an import 

terminal, when it was an industry. So this—— 

Chairman WEBER. You need to work on some more of those. 

Mr. SMITH. Well, we’ve worked on quite a few of them. 

Mr. LOUDERMILK. And so from what I’m hearing it’s because of 

the fracking and the access and the cheap natural gas we have 

here in the United States has definitely helped offset some of the 

loss of our coal production and keeping the prices down for the consumers. 

Mr. SMITH. Indeed. I mean, 40 percent of our power generation 

comes from coal, a big percent comes from natural gas, and they’re 

both important. 

Mr. LOUDERMILK. Last quick question if I may, Mr. Chairman. 

There is a movement to keep it in the ground, which would stop 

fracking and access to this natural gas. I mean, we actually have 

some presidential candidates who are campaigning on this, we’re 

going to keep it in the ground and put a lock on accessing these 

commodities through fracking and natural gas. Would that not 

cause a spike in electricity production should as we’ve just been 

discussing the access to these commodities is what’s kept the prices 

low as we shut down coal. Would that not have the opposite effect? 

Mr. SMITH. The increasing production of natural gas has had a 

very positive impact on our economy. It’s had a positive impact on 

the environment. We understand—I mean, there are concerns 

about some of the risks but those are things that we’ve quantified 

and we believe that this is a process that can be managed safely, 

so we think that natural gas is an important part of the clean energy economy of the future. In fact, we’ve been kind of explicit 

around that view. 

Mr. LOUDERMILK. Thank you, sir. I yield back. 

Chairman WEBER. I thank the gentleman. 

The gentleman from Texas, Mr. Veasey, is recognized. 

Mr. VEASEY. Thank you, Mr. Chairman, and Secretary Smith, 

thank you for being here today. It’s always good to see someone 

else from Fort Worth on Capitol Hill, so welcome here today. 

And I wanted to ask if you could touch very briefly on the Texas 

Clean Energy Project. As you know, that is of huge importance to 

the state and I wanted to see what you know about it and if you 

can just briefly get me caught up on that. 
47 

Mr. SMITH. Well, thank you very much for the question, Congressman. So the Texas Clean Energy Project is a project that was 

designed to—it’s one of the major demonstrations designed to capture CO2 coming out of a plant in Texas. It’s a project that we’ve 

been working on for the last several years along with a company 

called Summit that’s based in Washington State. Along with all of 

our major demonstrations, it’s been kind of an important part of 

our effort to ensure that technologies move from the desktop to the 

laboratory out into the real world and get built and developed. 

We’ve recently made—you know, over time we’ve allowed this 

project to have additional time to meet some major milestones. 

Whenever we have a major project like this, we put in place very 

well thought-out controls to ensure that we’re getting the best 

value for the taxpayer. That project has some milestones that it 

has not met in terms of getting financing for the project, and so I’ve 

recently—just recently sat down with the CEO of that company. 

We’ve discussed offering them a no-cost extension that would allow 

them to continue to try to develop the project at no additional cost 

to the taxpayer. Again, these are difficult projects. They’re tough 

projects. This is a company that’s been dogged in its pursuit of 

what we think is a really important project for us. And you know, 

I foresee them, you know, trying to continue to raise additional 

funding for that project but at this point the U.S. government is 

not putting additional taxpayer funds towards that project. 

Mr. VEASEY. Thank you very much for the update on that. 

And I want to shift over to sequestration. It appears that we’ve 

solved some key technological hurdles when it comes to sequestering CO2 in geological formations but we still have a lot of challenges that we have to overcome in that area, and I wanted to ask 

you what are some of the key hurdles left in DOE’s research into 

carbon sequestration? 

Mr. SMITH. Well, thank you for the question. So we’ve got seven 

major—seven regional partnerships across the United States that 

are looking at the challenge of putting CO2 into geologic formations 

across the United States, and this is looking at a variety of depositional environments, a variety of geologic settings, so the geology 

in different parts of the United States is different and therefore 

you have to do different types of research about the effectiveness 

of storing CO2 in formations across the United States. 

The challenge of CO2 storage is that you are storing just enormous, enormous quantities of CO2, and that’s one of the reasons 

why geologic storage in saline aquifers is what we see as being 

kind of the future of carbon storage. 

We’ve learned a lot in that process. We’ve been able to create a 

lot of data that we’re able to provide in terms of the potential of 

storing CO2 in different areas so we’ve put out atlases that show 

the potential for carbon storage, and we know that we’ve got a tremendous, tremendous resource in the United States in terms of the 

storage potential for CO2. We’re continuing to work on issues 

around monitoring and verification. We’ve got projects that have 

cycled out of the phase of injecting CO2 into the ground and have 

moved on to that medium-term monitoring and verification, so 

there’s more work for us to but we’re working very closely with 

state and local authorities. The end goal of all this effort is to be 
48 

able to scientifically quantify the activity and the opportunity and 

to provide regulatory authorities with the data they need in order 

to create a robust permanent environment in the future in which 

we know that we’re going to have to capture all the CO2 and store 

it for—store it in these geologic formations. 

Mr. VEASEY. Has DOE researched the public relations and education aspect of siting the CO2 pipelines and commercial storage 

sites? 

Mr. SMITH. Indeed. I mean, part of what we do, I mentioned the 

atlases and the other publications that the NETL puts out. I think 

that’s an important part of the public outreach so that we’re clearly 

communicating the results of the project. People know, you know, 

that we’ve understood the issues around long-term geologic storage, 

everything from well bores to ability all the way through induced 

seismic issues. I think it’s important that we take any of these 

risks seriously and that we clearly communicate the scientific research so that we’re quantifying the risk. 

Additionally, you know, projects like the ADM project that we’re 

doing in Illinois have a component of creating a public outreach 

centers that we’re able to communicate with the public so that they 

understand our research and the process that one would have to 

go through in order to accomplish one of these projects. 

Mr. VEASEY. Thank you very much, and Mr. Chairman, in closing, I hope that Mr. Smith has a chance to go back to his alma 

mater of Southwest High School and talk with their program that 

they actually have a program at the school that trains people on, 

you know, exploration and the different aspects of energy and being 

a petroleum engineer specifically, and so hopefully you have a 

chance to go back to Fort Worth ISD and do that. 

And Mr. Chairman, I yield back. Thank you. 

Mr. SMITH. Thank you. I’ll be back in Fort Worth this Friday actually. 

Chairman WEBER. Marc, did they have multiple classes when 

you were in high school? They weren’t all just in one single room 

with a wood-burning stove? 

Mr. VEASEY. No, we had moved past the schoolhouse—— 

Chairman WEBER. Okay. I was just—— 

Mr. VEASEY. —into a full school by the time I was there. 

Chairman WEBER. —curious. All right. Thank you. The gentleman yields back. 

The gentleman, the pride of East Texas, the Big Thicket, is recognized, and you’ve got a lot of forest out there, Dr. Babin, that 

uses CO2, I bet. You’re recognized for five minutes. 

Mr. BABIN. Those trees needs lots of CO2, or they give a lot of 

oxygen back. Thank you, Mr. Chairman. 

And thank you, Mr. Secretary. We appreciate you, and you had 

mentioned a Houston project a while ago, and would you give me 

the name of that? 

Mr. SMITH. That’s the Petra Nova project. It’s a collaboration 

with NRG so it’s a 240-megawatt post-combustion capture project 

that’s just south of Houston, Texas. 

Mr. BABIN. Just south? 

Mr. SMITH. Just south of Houston. 

Mr. BABIN. All right. Thank you. 
49 

And I noticed you’re a graduate of West Point as well, right? 

Mr. SMITH. I am indeed. 

Mr. BABIN. Yeah. That’s good. Well, I have a son that went to 

the Naval Academy. Go Navy, beat Army. 

Mr. SMITH. Okay. Beat Navy. 

Mr. BABIN. Well, funding for the TCEP, or Texas Clean Energy 

Project, is a coal gasification project in Texas, which we’ve talked 

about a little bit today, was pulled to fund other priorities in the 

fiscal year 2017 budget. This Committee has been working in a bipartisan manner to get to the bottom of the problems with the 

project, and we appreciate the letter that you sent in response to 

some of our questions about this project, and in your response you 

referenced an internal review that your office conducted of the 

project before making the decision to rescind the funding. Can you 

commit to provide that review to this Committee? 

Mr. SMITH. I’d be happy to respond to that for the record. 

Mr. BABIN. Okay. That’d be great. 

The DOE Inspector General released a special report on TCEP 

just last month, and in this report, the IG was very critical of 

DOE’s management practices, particularly when it came to enforcing deadlines, cost ceilings, and managing risk for the taxpayers. 

Your office has overseen several large project failures and it’s clear 

that there is a systematic problem in the Office of Fossil management for large commercialization projects. What steps have you 

taken to address these management issues? 

Mr. SMITH. Well, thank you for the question, Congressman, and 

that’s obviously a big issue. 

So first, to address the IG report, so the bottom line on the IG 

report was that they recommended that the Department of Energy 

continues to not advance funds to the TCEP project. When we have 

a project like this, we take the overall award, which I think was 

around $450 million for the TCEP project, and we divide it up into 

phases, phase I, which is the project development, and then phase 

II, which is construction and operation, and we have milestones 

within phase I that allow the applicant to get from phase I to 

phase II. These projects are difficult. Again, the primary difficulty 

is commercial, commercially difficult. You have to sell the CO2. You 

have to sell the urea offtake. You have to sell the power. You have 

to get your EBC contract in place. You have to get financing. So 

there’s lots of moving parts, and you’re trying to do this in an environmental which again it’s free to emit as much CO2 into the environment as you want to, so they’re commercially difficult. 

They’re important, and we worked with the Summit team, you 

know, over time to give them more time to accomplish some of the 

milestones. We worked with them to advance in funding from 

phase II to phase I. Every time we do that, it’s a case-by-case decision. I mean, we don’t have our feet set in stone. We have to look 

at what the market’s doing. We have to look at what progress is 

being made, and we have to look at what the risks are to the taxpayer of making the decision to advance funds from phase II to 

phase I. 

At some point, however, you decide that it’s not the prudent 

thing to do in terms of getting the best outcome for the taxpayer, 

which is exactly what we did in this case. So we have to make 
50 

some hard decisions in some cases. We’d love for all the projects 

to make it. But the bottom line is that these projects are difficult, 

and if we knew they were all going to make it, there probably 

would not be a role for the government to help push these along. 

So—— 

Mr. BABIN. Let me follow up with something real quickly here. 

Looking at this and other failed or struggling projects in the fossil 

portfolio, the connecting thread seems to be the size and the goal 

of the project. It seems like when the Office of Fossil undertakes 

a large commercialization project, there are frequent problems and 

delays. The Department has considerable expertise in research and 

development, and a long history of success in fossil energy. 

Shouldn’t DOE get the hint and focus on fossil technology R&D instead of investing in companies looking to commercialize energy 

technology? 

Mr. SMITH. Well, Congressman, we do both. I think that both are 

important roles for our Department. So we invest in those earlystage technologies from controls to systems to materials to nextgeneration technologies like pressurized oxy-combustion and chemical looping. We think there’s an important role for us there. We 

think there’s also an important role for the major demonstrations. 

Throughout our seven regional partnerships, we’ve got a number of 

very, very successful projects that again have stored almost 12 million tons of CO2 over time. We spoke about the project that we did 

in Chairman Weber’s district, the Air Products project, the Archer 

Daniels Midland project in Illinois, the Petra Nova project that you 

and I just spoke about. These are examples of taking ideas from 

the laboratory and putting them out into the field so they’re actually pouring concrete and bending rebar and erecting steel and getting projects built. They’re difficult. If they weren’t difficult, we 

wouldn’t be working on them. 

But—and we learn something every time we do one of these 

things but I would characterize our risk management methodology 

as being robust, as being sound, and again, we think that these are 

really, really important projects and for the future of fossil energy 

and making sure that all of our sources of energy remain relevant. 

They’re important for coal. 

Mr. BABIN. Okay. Thank you. 

Mr. Chairman, thank you, and my time is expired. 

Chairman WEBER. I thank the gentleman, and I want to thank 

Chairman, or Secretary Smith for his valuable testimony, for being 

here, and the record will remain open for two weeks for additional 

comments and written questions from members. 

I do want to say in closing, however, though, that it’s our opinion 

that I think it would be better that the DOE would focus on innovation rather than commercialization and kind of leave as much of 

that to the private sector as we can. So we thank you for being 

here, Secretary Smith, and this hearing is adjourned. 

[Whereupon, at 11:38 a.m., the Subcommittee was adjourned.] 
(51) 

Appendix I 

ANSWERS TO POST-HEARING QUESTIONS
52 

ANSWERS TO POST-HEARING QUESTIONS

Responses by The Hon. Chris Smith 
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59 
60 
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