DEFENSE 

INFRASTRUCTURE

Improvement Needed 

in Energy Reporting 

and Security Funding 

at Installations with 

Limited Connectivity

Report to Congressional Committees

January 2016

GAO-16-164

United States Government Accountability Office
United States Government Accountability Office

Highlights of GAO-16-164, a report to 

congressional committees

January 2016

DEFENSE INFRASTRUCTURE

Improvement Needed in Energy Reporting and 

Security Funding at Installations with Limited 

Connectivity

Why GAO Did This Study

DOD is the largest energy consumer in 

the federal government, spending 

about $4.1 billion on facilities' energy at 

more than 500 permanent military 

installations throughout the world in 

fiscal year 2013. To help ensure 

oversight of DOD’s fulfillment of energy 

performance goals, Congress requires 

that DOD track energy savings, 

investments, and projects in its annual 

Energy Report. The Energy Report 

also details DOD’s activities to 

enhance energy security.

Congress included a provision for GAO 

to review DOD’s fiscal year 2013 

Energy Report and energy security at 

energy-remote military installations—

that is, those installations located in 

areas with limited connectivity and 

without significant infrastructure of 

power plants, transmission lines, or 

distribution lines. 

GAO assessed the extent to which (1) 

DOD addressed the 12 required 

reporting elements and reliably 

reported data in its fiscal year 2013 

Energy Report and (2) the military 

services help ensure energy security at 

energy-remote military installations in 

the United States. GAO analyzed 

DOD’s Energy Report and interviewed 

officials from the Office of the 

Secretary of Defense, military services, 

defense agencies, and all installations 

in Alaska and Hawaii because they 

were identified as energy remote.

What GAO Recommends

GAO recommends, among other 

things, that DOD revise its guidance for 

producing the Energy Report and 

clarify funding processes to include 

consideration of energy security. DOD 

concurred with all recommendations.

What GAO Found

The Department of Defense’s (DOD) fiscal year 2013 Annual Energy 

Management Report (Energy Report) addressed some of the required reporting 

elements and correctly incorporated data from the military services and defense 

agencies. However, the report is not fully reliable because the data were 

captured and reported using different methods, hindering comparability across 

the department. Specifically, the Energy Report addressed six, partially 

addressed four, and did not address two reporting requirements. For example, 

the Energy Report addressed the requirement to describe actions taken to 

implement DOD’s energy performance master plan, partially addressed the 

requirement to describe progress to meet various energy goals (it described 

progress for three of five required goals), and did not address the requirement to 

describe the types and amount of financial incentives received. The Energy 

Report correctly reflected data provided by the military services and defense 

agencies. However, the military services and defense agencies used different 

methods for capturing and reporting on data in the Energy Report such as on 

energy consumption and projects. These inconsistencies resulted from guidance 

that was either unclear or lacking. For example, DOD did not provide guidance 

on reporting end-of-fiscal-year energy data; thus, the military services and 

defense agencies used different reporting methods. Without clear guidance for 

reporting data consistently, it will be difficult for DOD to have reliable data to plan 

effectively to reach energy goals, and Congress will have limited oversight of 

DOD’s energy consumption and difficulty in comparing energy projects.

The military services generally help ensure energy security (the ability to 

continue missions in the event of a power outage) at their energy-remote military 

installations in Alaska and Hawaii by providing access to multiple power sources. 

However, GAO identified areas of risk to energy security regarding installation 

electricity systems, high energy costs, and funding. GAO found that the military 

services addressed some risks by conducting studies on integrating renewable 

energy into electricity systems and identifying alternative energy solutions to 

lower costs. However, military service efforts to incorporate energy security into 

funding decisions have been limited. The processes to evaluate projects for 

funding generally do not consider energy security in prioritizing those to receive 

funding, and officials from all four military services stated that there is no military 

service or DOD guidance related to evaluating projects for funding that focuses 

on energy security. As a result, six of the nine locations GAO visited in Alaska 

and Hawaii cited difficulty obtaining funding for energy security projects. For 

example, officials at the Air Force’s Alaska Radar System said they have sought 

funding since 2002 to build a networked system of multiple fuel tanks at three offgrid locations that each have only one fuel tank, but they said energy security 

projects do not compete well against other projects, such as those for new 

facilities. Navy officials similarly stated that energy security projects—which have 

significant infrastructure costs—do not compete well for funding against energy 

conservation efforts based on return on investment. Without clarification of the 

processes used to compare and prioritize projects for funding to include 

consideration of energy security, it will be difficult for decision makers to have 

sufficient information to adequately prioritize energy security projects for funding 

when appropriate and thus address energy security issues.

View GAO-16-164. For more information,

contact Brian J. Lepore at (202) 512-4523 or 

leporeb@gao.gov or Frank Rusco at (202) 

512-3841 or ruscof@gao.gov.
Page i GAO-16-164 DOD Energy Management

Letter 1

Background 4

DOD Met Some Reporting Requirements and Correctly Reflected 

the Military Services’ and Defense Agencies’ Data and Other 

Inputs in Its Fiscal Year 2013 Energy Report, but the Data Are 

Unreliable 10

Military Services Are Helping to Ensure Energy Security at U.S. 

Energy-Remote Installations, but Areas of Risk Remain 22

Conclusions 31

Recommendations for Executive Action 32

Agency Comments and Our Evaluation 32

Appendix I Objectives, Scope, and Methodology 37

Appendix II GAO Assessment of the Extent to Which the Annual Energy

Management Report Addressed the Required Reporting Elements 41

Appendix III Comments from the Department of Defense 45

Appendix IV GAO Contacts and Staff Acknowledgments 48

Related GAO Products 49

Tables

Table 1: GAO Assessment of the Extent to Which the Annual 

Energy Management Report Addressed the Required 

Reporting Elements 12

Table 2: Locations Visited or Contacted and Number of 

Associated Installations 40

Contents
Page ii GAO-16-164 DOD Energy Management

Figures

Figure 1: Department of Defense’s Typical Process for Collecting 

the Data Reported in Its Annual Energy Management 

Report 6

Figure 2: Map of Transmission Lines, Power Plants, and 

Installations in the Continental United States, Alaska, and 

Hawaii 9

Figure 3: Reporting Methods for Tenants by the Military Services 

and Defense Agencies in the Department of Defense’s 

Fiscal Year 2013 Annual Energy Management Report 17

Figure 4: Reporting Methods for Hosts by the Military Services 

and Defense Agencies in the Department of Defense’s 

Fiscal Year 2013 Annual Energy Management Report 18

Figure 5: Reporting Methods on Energy Projects by the Military 

Services and Defense Agencies in the Department of 

Defense’s Fiscal Year 2013 Annual Energy Management 

Report 19

Figure 6: Reporting Methods by the Military Services and Defense 

Agencies for End-of-Fiscal-Year Data Collection in the 

Department of Defense’s Fiscal Year 2013 Annual 

Energy Management Report 20

Figure 7: 1.4 Megawatt Generators at Landfill Gas Plant at Joint 

Base Elmendorf-Richardson, Alaska 24

Figure 8: Single Large Fuel Tank at Alaska Radar System Site 27

Abbreviations

DOD Department of Defense

Energy Report Annual Energy Management Report

OSD Office of the Secretary of Defense

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Page 1 GAO-16-164 DOD Energy Management

441 G St. N.W.

Washington, DC 20548

January 27, 2016 

Congressional Committees

The Department of Defense (DOD) is the largest energy consumer in the 

federal government, spending about $4.1 billion on facilities’ energy at 

more than 500 permanent military installations throughout the world in 

fiscal year 2013. These permanent installations are critical components of 

DOD’s ability to fight and win wars, and they account for approximately 30 

percent of DOD’s total energy use. To help ensure oversight of the 

department’s fulfillment of energy performance goals, Congress requires 

that DOD track energy savings, investments, and projects in its Annual 

Energy Management Report (Energy Report). The Energy Report also 

details DOD’s activities to enhance energy security and resilience, with 

DOD reporting that it is critical for installation commanders to understand 

the vulnerabilities and risks associated with power disruptions that affect 

mission assurance. These power disruptions become even more critical 

at DOD installations that are located in areas without significant 

infrastructure of power plants, transmission lines, and distribution lines 

(i.e., energy-remote locations), which may have fewer options to obtain 

sufficient and reliable energy to ensure continuation of mission.

Since 2005, we have issued over a dozen reports on defense energy 

issues, including reports on specific requirements in DOD’s Energy 

Report, renewable energy, and energy project financing options. In our 

September 2010 report, we found that the fiscal year 2009 Energy Report 

did not include information on the eight specific issues identified by the 

National Defense Authorization Act for fiscal year 2010.1 In our January 

2012 report, we found that DOD’s fiscal year 2010 Energy Report fully 

addressed two, did not address one, and partially addressed five of the 

eight expanded reporting requirements.2 The Related GAO Products 

page at the end of this report provides a listing of our related work.

1

GAO, Defense Infrastructure: Department of Defense’s Energy Supplemental Report, 

GAO-10-988R (Washington, D.C.: Sept. 29, 2010). 

2

GAO, Defense Infrastructure: DOD Did Not Fully Address the Supplemental Reporting 

Requirements in Its Energy Management Report, GAO-12-336R (Washington, D.C.: Jan. 

31, 2012). 

Letter
Page 2 GAO-16-164 DOD Energy Management

Section 2925 of Title 10 of the United States Code requires that, not later 

than 120 days after the end of each fiscal year, the Secretary of Defense 

shall submit to the congressional defense committees an installation 

energy report detailing the fulfillment during that fiscal year of select 

energy performance goals. Specifically, under the law, DOD’s Energy 

Report must include 12 reporting elements, such as a table detailing 

funding for all energy projects funded through appropriations, a table 

listing third-party financing mechanisms, a description of actions taken 

and energy savings realized from DOD’s energy performance master 

plan, and details of utility outages at military installations. In the Joint 

Explanatory Statement accompanying the Carl Levin and Howard P. 

“Buck” McKeon National Defense Authorization Act for Fiscal Year 2015, 

Congress included a provision that we review DOD’s fiscal year 2013 

Energy Report and energy security at energy-remote military installations 

in the United States.3 This report addresses the extent to which (1) DOD 

addressed the 12 required reporting elements and reliably reported data 

in its Energy Report and (2) the military services helped ensure energy 

security at energy-remote military installations in the United States.

To determine the extent to which DOD addressed the 12 required 

reporting elements and reliably reported data in its Energy Report, two 

GAO analysts independently reviewed the fiscal year 2013 Energy 

Report, comparing it with each element required by the law and 

determining whether each required reporting element was included. In the 

case of any conflicting determinations, a third GAO analyst adjudicated 

the difference. To gain a full understanding of the elements included in 

the Energy Report and to discuss the methodology used for collecting 

information and reporting on the required elements, we met with DOD 

officials knowledgeable about compiling information for the report, 

including individuals from the Office of the Secretary of Defense (OSD)—

specifically, the Assistant Secretary of Defense for Energy, Installations, 

and Environment; the four military services; and the 10 defense agencies 

 3

The Joint Explanatory Statement also included a provision that we review how DOD has 

determined the costs and benefits of a sample of five renewable energy projects per 

military service. We are reviewing this provision separately and plan to report on the 

results in 2016.
Page 3 GAO-16-164 DOD Energy Management

that contributed to the report.4 We also reviewed the data and other 

inputs provided by each military service and defense agency to be 

included in the Energy Report. We looked for any anomalies in the data, 

such as missing data fields or numerical outliers. To examine whether the 

data and other inputs were correctly reflected, we then compared the data 

and other inputs from each military service and defense agency to the 

published Energy Report, using as criteria GAO’s Standards for Internal 

Control in the Federal Government and DOD’s Annual Energy 

Management Report Fiscal Year 2013 Reporting Guidance.

5 To 

standardize responses among the military services and defense 

agencies, we sent a structured questionnaire to knowledgeable officials 

from the four military services and 10 defense agencies regarding data 

collected for the Energy Report, including information about how facilities 

within each military service and defense agency reported energy 

consumption, energy projects, and September 2013 end-of-fiscal-year 

energy consumption data included in the Energy Report.

To determine the extent that the military services helped ensure energy 

security at energy-remote military installations in the United States, we 

first determined the scope of energy-remote military installations by 

evaluating electrical interconnectedness and robustness. First, to review 

interconnectedness, we conducted research on the U.S. electric power 

system and determined that Alaska and Hawaii have limited 

interconnectedness.6 Second, once we identified these states, we sought 

to further narrow the scope by determining which areas in Alaska and 

Hawaii are less “electrically robust” (i.e., those areas where there is a 

smaller number of power plants and transmission lines surrounding the 

 4

The fiscal year 2013 Energy Report included the facility energy activities of the four 

military services—Army, Navy, Air Force, and Marine Corps—and the following defense 

agencies: Defense Contract Management Agency, Defense Commissary Agency, 

Defense Finance and Accounting Service, Defense Intelligence Agency, Defense 

Logistics Agency, Missile Defense Agency, National Geospatial-Intelligence Agency, 

National Reconnaissance Office, National Security Agency, and Washington 

Headquarters Services.

5

GAO, Standards for Internal Control in the Federal Government, GAO/AIMD-00-21.3.1

(Washington D.C.: November 1999); DOD, Annual Energy Management Report Fiscal 

Year 2013 Reporting Guidance (July 2013). 

6

We determined that Alaska and Hawaii have limited interconnectedness because they 

are not connected to the three power grids in the 48 contiguous states, which are 

interconnected to each other. Moreover, the electrical systems in Alaska and Hawaii are 

not connected to each other.
Page 4 GAO-16-164 DOD Energy Management

installation or no connectivity to transmission lines—for example, an 

installation that uses diesel generators for primary power) and therefore 

more energy-remote. Ultimately, all 26 installations in Alaska and 35 

installations in Hawaii were included in our scope. We then visited or 

contacted facility energy managers at 9 locations that were responsible 

for overseeing all 61 installations.7 For each location, we interviewed 

facility energy managers to identify the procedures, equipment, and plans 

in place to ensure energy security on site. We compared their actions to 

relevant DOD and military service regulations and guidance on their roles 

and responsibilities regarding energy security, including DOD’s Energy 

Report, DOD installation energy guidance, and military service energy 

security guidance. We also interviewed military service officials to discuss 

their efforts and potential progress in helping to ensure energy security at 

energy-remote military installations. More details about our scope and 

methodology are included in appendix I.

We conducted this performance audit from March 2015 to January 2016 

in accordance with generally accepted government auditing standards. 

Those standards require that we plan and perform the audit to obtain 

sufficient, appropriate evidence to provide a reasonable basis for our 

findings and conclusions based on our audit objectives. We believe that 

the evidence obtained provides a reasonable basis for our findings and 

conclusions based on our audit objectives.

Within DOD, the military services and defense agencies are responsible 

for installation management, with oversight by the office of the Assistant 

Secretary of Defense for Energy, Installations, and Environment, who 

reports to the Under Secretary of Defense for Acquisition, Technology 

and Logistics. The office of the Assistant Secretary of Defense for 

Energy, Installations, and Environment is responsible for—among other 

things—issuing facility energy policy and guidance to DOD components 

and coordinating all congressional reports related to facility energy, 

including the Energy Reports. In addition, each military service is 

 7

We visited or contacted the facility energy manager(s) at each location and discussed 

with them the associated installations they oversaw. 

Background

DOD Roles and 

Responsibilities for Energy 

Management on DOD 

Installations
Page 5 GAO-16-164 DOD Energy Management

responsible for developing policies and managing programs related to 

energy and utility management, and has assigned a command or 

headquarters to execute these responsibilities.8 The defense agencies 

also develop policies and manage energy programs, and each has a 

designated senior energy official to administer their respective programs. 

At the installation level, the public works, general facilities, or civil 

engineering departments oversee and manage the day-to-day energy 

operations.

DOD undergoes an annual process to report on energy data in its Energy 

Reports, collecting data required by section 2925 of Title 10 of the United 

States Code for the reports over a 5-month time period. The overall 

process, with participation by installations, military service headquarters, 

defense agencies, and OSD, is detailed in figure 1.

 8

Within the Army, the responsible organization is the Installation Management Command, 

under the Assistant Secretary of the Army, Installations and Environment; within the Navy, 

the Naval Facilities Engineering Command, under the Commander, Navy Installations 

Command; within the Marine Corps, Marine Corps Installation Command; and within the 

Air Force, the Air Force Civil Engineer.

Annual Energy 

Management Report 

Process
Page 6 GAO-16-164 DOD Energy Management

Figure 1: Department of Defense’s Typical Process for Collecting the Data Reported in Its Annual Energy Management Report

a

Section 2925 of Title 10 of the United States Code requires the Secretary of Defense to submit an 

installation energy management report. OSD also receives information and reports on energy at 

facilities—real property entities consisting of one or more of the following: a building, a structure, a 

utility system, pavement, and underlying land. For the purposes of this figure, we focus on 

installations—a facility or group of facilities in a specific geographic area and within reasonable 

proximity that supports a general functional purpose, collective activity, or mission.
Page 7 GAO-16-164 DOD Energy Management

Across the military services, energy security is considered critical for 

mission assurance. Energy security is defined by 10 U.S.C. § 2924 as 

having assured access to reliable supplies of energy and the ability to 

protect and deliver sufficient energy to meet mission essential 

requirements. There are multiple ways, although not all are mutually 

exclusive, to help ensure energy security at installations, including:

• Diversification of energy sources. To help ensure energy security, 

installations may seek to obtain energy from multiple sources to 

prevent reliance on a single source. This may include natural gas, 

petroleum, coal, and incorporation of renewable sources of energy—

e.g., wind, solar, and biodiesel.

• Use of renewable energy. Installations may work to incorporate 

renewable energy sources as a way to lessen dependence on the 

grid, lower energy costs, and increase utility resilience in the event of 

an outage.9 For example, renewable energy may be used to power a 

microgrid, in which the installation can disconnect from the utility grid 

during an outage and run solely on the renewable energy stored.10

• Energy redundancy. Installations may seek assured access to 

reliable energy through back-up energy sources that may be used in 

the event of an outage, such as on-site generators and power plants.

• Energy conservation. Installations may use energy conservation 

initiatives as a way to reduce energy consumption, lower energy 

costs, and ensure that sufficient funds are in place to meet future 

energy requirements.

DOD installations may use one or more of these approaches to help 

ensure energy security. Each installation’s efforts to help ensure energy 

security may vary depending on its location, staff resources and funding 

available, and the nature of energy vulnerabilities identified.

 9

According to the Department of Energy, the grid provides power to homes, businesses, 

and other buildings through central power sources. This interconnectedness means that 

when part of the grid needs to be repaired, everyone is affected.

10According to the Department of Energy, a microgrid is a local energy grid with control 

capability, which means it can disconnect from the grid and operate autonomously. A 

microgrid generally operates while connected to the grid, but it can break off and operate 

on its own using local energy generation in times of crisis like storms or power outages or 

for other reasons.

Military Installations’

Energy Security Efforts
Page 8 GAO-16-164 DOD Energy Management

According to the U.S. Energy Information Administration, there is not a 

single national power grid in the United States. Instead, there are three 

synchronized power grids that cover the 48 contiguous states that are 

loosely interconnected with each other: (1) the Eastern Interconnection 

(serving states generally east of the Rocky Mountains), (2) the Western 

Interconnection (spanning the area from the Pacific Ocean to the Rocky 

Mountain states), and (3) a system that serves nearly all of Texas.

The electricity systems in Alaska and Hawaii operate independently of the 

three continental grids and of each other (see fig. 2). In particular, there 

are several distinct electrical systems within Alaska and Hawaii that cover 

only portions of the states, such as the interconnections serving 

Anchorage, Fairbanks, and the Kenai Peninsula in Alaska and the 

individual islands in Hawaii.

Electrical Grids and 

Energy-Remote 

Installations in the United 

States
Page 9 GAO-16-164 DOD Energy Management

Figure 2: Map of Transmission Lines, Power Plants, and Installations in the Continental United States, Alaska, and Hawaii

Energy-remote installations in Alaska and Hawaii face some unique 

differences from the installations located in the 48 contiguous states. For 
Page 10 GAO-16-164 DOD Energy Management

example, the cost of energy at energy-remote installations is high in 

comparison to the cost of energy at installations in the 48 contiguous 

states. According to the U.S. Energy Information Administration, Hawaii 

had the highest cost of electricity in the United States in 2013 and 2014, 

with the average price for commercial customers more than triple the U.S. 

average. Moreover, in 2013, Hawaii imported 91 percent of the energy it 

consumed—mostly as oil-based fuels—making it vulnerable to price 

fluctuations in the energy market and disruptions to the transportation of 

fuels. In 2013 and 2014, Alaska had the second-highest cost of electricity 

in the United States, with the average price for commercial customers 64 

to 68 percent higher, respectively, than the U.S. average. In addition, the 

U.S. Energy Information Administration stated that in many areas of 

Alaska, commercially-supplied electricity is not available and consumers 

must generate their own electricity, sometimes using diesel generators, 

which have a high cost of operations. Given Alaska’s extreme weather 

environments, its energy demand per person is the third highest in the 

nation.

Of the 12 reporting requirements for DOD’s Energy Report, our analysis 

showed that the department fully addressed 6, partially addressed 4, and 

did not address 2. The requirements fully addressed included describing 

actions taken to implement the energy performance master plan and 

energy savings realized from such actions, among other requirements. 

DOD Met Some 

Reporting 

Requirements and 

Correctly Reflected 

the Military Services’

and Defense 

Agencies’ Data and 

Other Inputs in Its 

Fiscal Year 2013 

Energy Report, but 

the Data Are 

Unreliable

DOD’s Fiscal Year 2013 

Energy Report Met Some 

but Not All Reporting 

Requirements
Page 11 GAO-16-164 DOD Energy Management

The requirements partially addressed included describing progress made 

to achieve three of five energy goals; a table detailing funding, by 

account, for all energy projects funded through appropriations; a table 

listing all energy projects financed through third party financing 

mechanisms; and details of utility outages at military installations. The 

requirements not addressed were information on renewable energy 

certificates associated with energy projects financed through third-party 

financing mechanisms and a description of the types and amount of 

financial incentives received.11 According to OSD officials, these 

requirements were not fully addressed for a number of reasons, such as 

inclusion of the information in another report and concerns about public 

release. However, DOD did not identify that the information could be 

found elsewhere or that it had public release concerns to clarify why it did 

not include required elements. Table 1 below summarizes our 

assessment of the extent to which DOD’s report included each of the 

required reporting elements. Appendix II includes our detailed evaluation 

of each of the required reporting elements, including the reasons OSD 

officials provided for any requirements that were not fully addressed.

 11In the United States, renewable energy production essentially creates two products: the 

energy itself and an associated commodity, called a renewable energy certificate, which 

represents a certain amount of energy generated using a renewable resource. Renewable 

energy certificates are bought and sold in a fashion similar to stocks and bonds. 
Page 12 GAO-16-164 DOD Energy Management

Table 1: GAO Assessment of the Extent to Which the Annual Energy Management Report Addressed the Required Reporting 

Elements

Required reporting elements Our assessment

1. A description of progress to meet various energy goals. Partially addressed (described three of five required goals)

2. A table detailing funding, by account, for energy projects funded 

through appropriations.

Partially addressed (included a table but did not detail the 

funding by account)

3. A table listing energy projects financed through third-party 

financing mechanisms, the duration of each mechanism, an 

estimate of the financial obligation incurred, whether the project 

incorporates energy security, and the estimated payback period.

Partially addressed (included a table but did not include 

duration of funding mechanisms, estimate of the financial 

obligation, details on energy security, and the estimated 

payback period)

4. A list of any renewable energy certificates associated with thirdparty-financed projects including additional descriptive information 

about those certificates.

Not addressed (did not provide a list or description, although 

our analysis found some renewable energy projects that had 

associated certificates)

5. A description of actions taken to implement the energy 

performance master plan.

Fully addressed

6. A description of the energy savings realized from such actions. Fully addressed

7. An estimate of the types and quantities of energy consumed by 

DOD and its employees, and certain additional information about 

that energy consumption. 

Fully addressed

8. A description of the types and amount of financial incentives 

received under section 2913 of Title 10 of the United States Code, 

and additional information about those incentives.

Not addressed (did not provide a description)

9. A description and estimate of the progress made to meet 

certification requirements for sustainable green-building standards.

Fully addressed

10. A description of best practices for measuring energy 

consumption. 

Fully addressed

11. Details of utility outages at military installations. Partially addressed (generally identified information on utility 

outages at installations. However, as we reported in July 2015, 

DOD’s collection and reporting of utility disruption data was not 

comprehensive and contains inaccuraciesa

)

12. A description of any other issues the Secretary of Defense 

determined relevant.

Fully addressed

Source: GAO analysis of DOD’s Annual Energy Management Report. | GAO-16-164

Notes: The National Defense Authorization Act for Fiscal Year 2016, Pub. L. No. 114-92 (2015), 

changed several of the required reporting elements. In particular, the fourth requirement on 

renewable energy certificates and the seventh requirement on estimating the types and quantities of 

energy consumed were removed. The ninth requirement on sustainable green-building standards was 

revised to require a description of progress in meeting certain standards under the Unified Facilities 

Criteria. The eleventh requirement on utility outages was revised to require details of non-commercial 

utility outages and DOD-owned infrastructure. Additionally, a new requirement was added for the 

inclusion of a classified annex, as appropriate.

a

GAO, Defense Infrastructure: Improvements in DOD Reporting and Cybersecurity Implementation 

Needed to Enhance Utility Resilience Planning, GAO-15-749 (Washington, D.C.: July 23, 2015).

We found that the required reporting elements were not all met because 

OSD’s process for producing the Energy Report did not ensure this 

occurred. Specifically, in 2011, OSD developed its current process for 
Page 13 GAO-16-164 DOD Energy Management

collecting energy data and producing the Energy Report, including a 

standard format that it populates each year with updated narrative and 

energy data. This process, however, did not account for certain steps. For 

example, the process step of deciding what data to collect from the 

installations did not identify all data to be captured to fulfill the 

requirements. OSD’s guidance and template for collecting energy data 

did not include instructions to collect these data. As a result, OSD did not 

have comprehensive data to report on requirements such as financial 

incentives and renewable energy certificates received from utility energy 

service contracts and energy savings performance contracts.12

Additionally, OSD’s process step for consolidating specific requirements 

into the written report had not been reexamined in several years, resulting 

in some requirements remaining unaddressed. Specifically, the decisions 

OSD made in 2011 for consolidating requirements into the Energy Report 

have not been updated or examined. For example, our review of the fiscal 

year 2014 Energy Report, issued in May 2015, found that many of the 

required reporting elements that were not fully addressed in the fiscal 

year 2013 Energy Report were also not fully addressed in the fiscal year 

2014 Energy Report.

Standards for Internal Control in the Federal Government call for 

agencies to update internal control activities when necessary to provide 

reasonable assurance for effectiveness of operations and compliance 

with applicable laws and regulations.13 Without further updates or 

examination of OSD’s process for producing the Energy Report, DOD is 

at risk of future annual reports also falling short of providing congressional 

decision makers with a complete and accurate understanding of the 

extent to which DOD has fulfilled select energy performance goals.

 12Utilities energy service contracts are contracts in which a utility arranges funding to 

cover the capital costs of the project, which are repaid over the contract term from costs 

savings generated by the energy efficiency measures. Energy savings performance 

contracts are partnerships between a federal agency and an energy service company, in 

which the energy service company guarantees that improvements to save energy will 

generate energy cost savings sufficient to pay for the project over the term of the contract.

13GAO/AIMD-00-21.3.1.
Page 14 GAO-16-164 DOD Energy Management

In our review of DOD’s Energy Report, we found that the underlying data 

correctly reflected input from the military services and defense agencies. 

However, DOD’s report was not fully reliable because the data and other 

inputs the military services and defense agencies provided were captured 

using different methods and thus hindered comparability.

In our review of DOD’s fiscal year 2013 Energy Report, we found that the 

vast majority of the data and other input submitted by the military services 

and defense agencies were correctly reflected in the published Energy 

Report.14 Any inaccuracies we found were insignificant. Specifically, in 

comparing the data submitted by the military services and defense 

agencies to the published Energy Report, we found 2 inaccuracies out of 

nearly 2,000 data inputs provided. For example, DOD received 

information about energy consumption and cost by square footage from 

705 installations and facilities. However, DOD did not include in the 

published report information on four facilities from the National 

Reconnaissance Office and one facility from the Air Force—an exclusion 

of less than 1 percent of the total number of installations that could have 

been reported. DOD responded that it chose not to include installation 

data for sensitivity reasons. Additionally, we found DOD incorrectly 

published in the Energy Report 1 out of 1,288 appropriated projects as 

contributing to energy efficiency goals rather than renewable energy 

goals.

However, in July 2015, we reported on material inaccuracies in duration 

and cost data on utility disruptions reported in DOD’s fiscal year 2012 and 

2013 Energy Reports.15 Regarding the duration of disruptions, we 

reported that three of the four military services reported some disruptions 

that were less than the DOD criteria of commercial utility service 

disruptions lasting 8 hours or longer.16 According to a DOD official, these 

disruptions constituted about 12 percent of the 266 disruptions DOD 

 14We excluded a review of utilities disruptions at military installations from this report 

because we previously reported on this topic in July 2015.

15GAO, Defense Infrastructure: Improvements in DOD Reporting and Cybersecurity 

Implementation Needed to Enhance Utility Resilience Planning, GAO-15-749 

(Washington, D.C.: July 23, 2015).

16The military services were required to report disruptions that lasted 8 hours or longer. 

DOD’s Fiscal Year 2013 

Energy Report Correctly 

Reflected Input but Data 

Are Unreliable and Hinder 

Comparability

DOD Correctly Reflected the 

Military Services’ and Defense 

Agencies’ Input in Its Energy 

Report
Page 15 GAO-16-164 DOD Energy Management

reported in the fiscal year 2012 and 2013 Energy Reports. Regarding the 

cost of disruptions, we reported that $4.63 million of the $7 million in utility 

disruption costs reported by DOD in its fiscal year 2012 Energy Report 

were indirect costs, such as lost productivity, although DOD had directed 

that such costs not be reported. We recommended, among other things, 

that DOD improve the effectiveness of data validation steps in its process 

for collecting and reporting utilities disruption data in order to improve the 

comprehensiveness and accuracy of certain data reported in the Energy 

Reports. DOD concurred with our recommendation but did not provide

information on the timeline or specific actions it plans to take to implement 

the recommendation. To date, no action has been taken to address this 

recommendation but DOD stated it expects to implement the 

recommendation by April 2016.

OSD, each of the four military services, and several defense agencies 

mentioned difficulties with conducting a quality data review. Specifically, 

officials said the timeframes were too short and resources too limited to 

conduct a thorough review. For example, Marine Corps officials said they 

scan data submitted by the installations for obvious errors, but OSD’s 

review process is more rigorous. Similarly, the Navy told us it relies 

heavily on OSD’s data reliability efforts. An OSD official and certain 

military services’ officials also explained that—in their limited time to 

validate all of the data included in the Energy Reports—they prioritize 

validation of certain data types, such as utilities disruption data.

To conduct their review, OSD officials said that they compared the fiscal 

years 2012 and 2013 Energy Report data to see if there were any major 

differences. The officials also compared data for consistency among 

similar data entries, such as renewable energy consumption, that were 

sent by each military service and defense agency in two different 

workbook submissions. From this review, the officials identified specific 

areas of concern and sent a three-to-four page questionnaire to each of 

the military services and defense agencies. The officials estimated they 

received about a 90 percent response rate and were able to make many 

edits to the data. They added that their review time was too limited to 

correct everything that might have been inaccurate, but from their 

perspective any inaccuracies would most likely be statistically 

insignificant. In July 2015, we found that, based on our review of the fiscal 

year 2014 utilities resilience data submitted by the military services to 

OSD—and OSD’s data validation efforts—the accuracy of some of DOD’s 
Page 16 GAO-16-164 DOD Energy Management

data may be improving.17 This improvement, along with actions to 

implement our recommendation to further improve the effectiveness of 

data validation steps, may provide the Congress better oversight of the 

efforts being undertaken by DOD.

We found that the military services and defense agencies captured and 

reported data using different methods in three areas of the Energy 

Report: energy consumption of tenants and hosts, energy projects, and 

end-of-fiscal-year data. This situation—which ultimately affects all data 

presented in the Energy Report—occurred because guidance was either 

unclear or lacking. In previous work examining, among other things, 

DOD’s efforts to effectively implement existing guidance, we found that 

clear and complete guidance is important for its effective 

implementation.18 Without collecting and reporting data using consistent 

methods, decision makers in DOD will be hindered in their ability to plan 

effectively for steps to reach energy goals, and Congress will have limited 

oversight of the department’s energy consumption and difficulty in 

comparing energy projects among those reporting.

• Energy consumption of tenants and hosts. At several installations,

DOD components may serve as either tenants, in which they rent 

space from another federal agency or a private organization, or hosts, 

in which they lease space to other agencies or organizations. The 

Energy Report guidance states that a host will report energy 

consumption, unless there is a mutual agreement between the host 

and the DOD tenant to report otherwise. However, we found that 

limited instructions in the guidance led to different reporting 

methodologies among and within the military services and defense 

agencies regarding tenant and host energy reporting. The guidance 

did not state that the military services or defense agencies should 

identify if they were tenants or hosts at each installation, how much 

energy they were reporting for tenants, or if they were splitting 

reporting among different energy types, such as having the host 

report all electrical consumption but the tenant report water and 

petroleum consumption. For example, for facilities in which the 

Defense Intelligence Agency served as tenants, the facilities either 

 17GAO-15-749.

18GAO, Climate Change Adaptation: DOD Can Improve Infrastructure Planning and 

Processes to Better Account for Potential Impacts, GAO-14-446 (Washington, D.C.: May 

30, 2014).

DOD Reported Data in Its 

Energy Report That Was

Captured and Reported Using 

Different Methods, Rendering It 

Unreliable
Page 17 GAO-16-164 DOD Energy Management

reported all energy consumption or did not report any energy 

consumption, assuming instead that the host would report. In contrast, 

all tenant facilities from the Defense Commissary Agency reported 

energy consumption that was separately metered or billed and 

assumed that the host reported energy consumption that was not 

separately billed. As a result, it is difficult to get a clear understanding 

of all the data presented in the Energy Report and challenging to 

compare it among the installations that reported. Figures 3 and 4 

identify some of the different reporting methods used by the four 

military services and 10 defense agencies for tenant and host energy 

reporting.

Figure 3: Reporting Methods for Tenants by the Military Services and Defense 

Agencies in the Department of Defense’s Fiscal Year 2013 Annual Energy 

Management Report

Notes: The different methods for reporting by tenants do not equal 14 because some military services 

and defense agencies identified that they did not serve as tenants at any installations, and others 

identified multiple ways they reported the data.

While the tenants assumed that the host/landlord reported energy consumption for the latter two 

reporting methods, the extent to which the host/landlord did or did not is unknown.
Page 18 GAO-16-164 DOD Energy Management

Figure 4: Reporting Methods for Hosts by the Military Services and Defense 

Agencies in the Department of Defense’s Fiscal Year 2013 Annual Energy 

Management Report

Notes: The different methods for reporting by hosts do not equal 14 because some military services 

and defense agencies identified that they did not serve as hosts at any installations, and others 

identified multiple ways they reported the data.

a

When the hosts did not report energy consumption for tenants, they assumed that the tenant 

independently reported its energy consumption. However, the extent to which tenants did or did not is 

unknown.

• Energy projects. The Energy Report lists energy conservation, 

renewable energy, and water conservation projects. However, 

throughout the report we found that the four military services and 10 

defense agencies reported these projects inconsistently (see fig. 5) 

because the guidance for the Energy Report does not identify at what 

levels they should be reported. Entities reported energy projects by 

installation, facility/building, project type, funding mechanism, or other 

means. For example, the Navy stated that it might consolidate 10 

smaller solar energy projects into 1 larger solar project for reporting 

purposes, whereas the Marine Corps stated that it does not track by 
Page 19 GAO-16-164 DOD Energy Management

project type but rather by installation, building, and energy type. 

These different methods of reporting energy projects make it difficult 

to clearly understand the size and scope of the projects as well as 

compare the projects among those reported.

Figure 5: Reporting Methods on Energy Projects by the Military Services and 

Defense Agencies in the Department of Defense’s Fiscal Year 2013 Annual Energy 

Management Report

Notes: The different methods for reporting energy projects do not equal 14 because some military 

services and defense agencies identified multiple ways they reported the data.

a

Other methods of reporting energy projects included consolidation at varying command levels and 

not reporting energy project data.

• End-of-fiscal-year data. We found that the military services and 

defense agencies used a variety of methods for reporting their end-offiscal-year energy data—and, in some cases, installations within each 

military service reported their end-of-fiscal-year energy data using 

different methods. For example, because OSD requires data inputs by 

mid-November, some military services required initial submissions 

from the installations by mid-October, which is before some energy 

utility bills have been received. As a result, some installations 

estimate end-of-fiscal-year usage, and the estimates may be based 

on different factors, including previous month data, historical data, or 

data from a month with similar weather patterns. Additionally, because 

utility bills may straddle months (such as from mid-September through 
Page 20 GAO-16-164 DOD Energy Management

mid-October), some military services and installations chose to report 

according to the utility bills rather than the fiscal year. In contrast, 

some installations have meters installed and report actual usage for 

the fiscal year. Figure 6 identifies the different methods used by the 

four military services and 10 defense agencies to report end-of-fiscalyear data.

Figure 6: Reporting Methods by the Military Services and Defense Agencies for 

End-of-Fiscal-Year Data Collection in the Department of Defense’s Fiscal Year 2013 

Annual Energy Management Report

Note: The different methods for reporting end-of-fiscal-year data do not equal 14 because some 

military services and defense agencies identified multiple reporting methods.

In our review of actual energy consumption data from a 

nongeneralizable sample of installations, we found some examples of 

how different methods of collecting data led to different reporting 

results. For example, the Navy’s Joint Base Anacostia Bolling in 

Washington, D.C. used estimates to determine its annual energy 
Page 21 GAO-16-164 DOD Energy Management

costs.19 In contrast, the Defense Finance and Accounting Service, 

National Reconnaissance Office, and Defense Contract Management 

Agency each reported actual fiscal year usage, not estimates. 

However, the Energy Report did not annotate when estimates were 

used. Furthermore, installations used different approaches to estimate 

end-of-fiscal-year data. For example, Navy installations used previous 

year data to make their estimates while some Air Force installations 

estimated based on a specific month with similar weather patterns. As 

a result, the data presented throughout the Energy Report cannot be 

reliably compared among the military services and defense agencies.

The guidance for the energy report did not identify how the military 

services and defense agencies should report energy data when it 

cannot reflect actual amounts for the full fiscal year. Additionally, the 

guidance did not identify how corrections can be made, if at all. For 

example, Navy officials told us they reported estimated consumption 

for all installations in the initial submission to OSD, and that although 

updated data was available by the December data quality review 

process with OSD, they were not allowed to make corrections 

because the estimated data had already been reviewed. By not 

providing guidance on how to report energy data when an installation 

cannot reflect actual data for the full fiscal year for the Energy Report, 

it is difficult to accurately compare data among the military services 

and defense agencies.

OSD officials told us that they do not include additional instructions in the 

guidance for the Energy Report to the military services and defense 

agencies regarding energy consumption of tenants and hosts, energy 

projects, and end-of-fiscal-year data collection and reporting. In some 

cases, OSD officials stated that it would be difficult to provide guidance. 

For example, they stated that each installation may receive utility bills at 

different intervals, such as monthly or quarterly, making it challenging to 

provide specific guidance on how to accurately report energy 

consumption for the end of the fiscal year. However, currently there are 

no instructions that require installations to identify their end-of-fiscal-year 

reporting methods so that OSD, the military services, and the defense 

agencies can identify if different reporting intervals exist. As a result, DOD 

is not in a position to identify in the Energy Report where different data 

 19The Navy’s Joint Base Anacostia Bolling in Washington, D.C. reported an annual energy 

cost over $1 million more than actually spent. 
Page 22 GAO-16-164 DOD Energy Management

reporting methods were used and what data may not be comparable 

among the military services and defense agencies.

Standards for Internal Control in the Federal Government states that 

information should be clearly communicated, so that users can determine 

whether the agency is achieving its compliance requirements.20 Without 

clear guidance for collecting and reporting data consistently, and clearly 

identifying where data may not be comparable and the reasons why, it will 

be difficult for decision makers in DOD to have reliable data to plan 

effectively for steps to reach energy goals, and Congress will have limited 

oversight of the department’s energy consumption and difficulty in 

comparing energy projects among those reporting.

The military services are helping to ensure energy security at all 

installations in Alaska and Hawaii by installing multiple power sources, 

which can be utilized in the event of an outage, at their remote facilities. 

Installations that were identified as mission critical by officials had 

additional energy security measures in place, such as on-site power 

plants and uninterruptible power supplies (i.e., backup that instantly starts 

once the grid loses power). For example, of the 20 sites that comprise the 

Air Force’s Alaska Radar System, officials stated that 10 of the sites are 

located “off-grid” and are equipped with stand-alone power plants 

including redundant generation capacity.21 According to officials, these 

sites are equipped with at least one generator that can supply sufficient 

 20GAO/AIMD-00-21.3.1.

21The Alaska Radar System is comprised of 20 radar sites that are used to provide some 

monitoring of defense activities in that region. 

Military Services Are 

Helping to Ensure 

Energy Security at 

U.S. Energy-Remote 

Installations, but 

Areas of Risk Remain

Military Services Are 

Helping to Ensure Energy 

Security
Page 23 GAO-16-164 DOD Energy Management

power generation and multiple generators to provide redundant back-up 

power. The officials stated that the 10 sites receiving their power from 

local grids are also equipped with redundant backup generators to ensure 

reliable power in the event of an outage. All of the Alaska Radar System 

locations also feature uninterruptible power supplies to ensure mission 

critical loads remain working. Additionally, given its mission importance, 

officials told us the Navy’s Pacific Missile Range Facility in Hawaii has a 

backup diesel generator plant that can start automatically in case of a grid 

failure. Furthermore, officials stated that the Army recently reached an 

agreement with Hawaiian Electric Company to build a 50 megawatt power 

plant in the interior of Oahu on Army land. According to Army officials, this 

new power plant could potentially provide power if a weather emergency 

shuts down the island’s coastal power plants. Moreover, Air Force 

officials in Hawaii told us that Kaena Point, a satellite tracking station, has 

an Air Force-owned diesel power plant onsite that provides back-up 

generation. This power plant is designed to start automatically when the 

grid goes down, and it can provide power to the base for about 40 days 

without refueling. In addition, officials at Joint Base ElmendorfRichardson, Alaska, stated Fort Richardson has significant redundancy 

through its onsite landfill gas electrical generation plant which, in 

combination with back-up generators, can provide complete energy 

independence from the municipal electrical grid for 2 weeks in the event 

of an emergency (see fig. 7).
Page 24 GAO-16-164 DOD Energy Management

Figure 7: 1.4 Megawatt Generators at Landfill Gas Plant at Joint Base ElmendorfRichardson, Alaska

We also found that the energy officials at all nine locations we visited or 

contacted stated they are generally prepared to respond to energy

disruptions that might occur, although we found that the level of 

documentation for energy security planning at energy-remote locations 

varies across installations.22 An OSD Energy Policy Memorandum 

requires that defense managers and commanders (1) conduct energy 

vulnerability analyses and review for currency annually, (2) establish 

energy emergency preparedness and operations plans, and (3) develop 

and execute remedial action plans to remove unacceptable energy 

security risks.23 We found differences among installations in regard to 

 22We visited or contacted energy officials at 9 locations, who were responsible for 

overseeing the 26 installations in Alaska and 35 installations in Hawaii. 

23Office of the Assistant Secretary of Defense, Defense Energy Program Policy 

Memorandum (DEPPM) 92-1 (Jan. 14, 1992). 
Page 25 GAO-16-164 DOD Energy Management

documentation of their plans. For example, Marine Corps Base Hawaii 

has a full energy emergency preparedness and operations plan and 

remedial actions plans. Officials at U.S. Army Garrison Hawaii, by 

contrast, stated that the Garrison does not have any documented energy 

emergency preparedness and operations plans. Army officials stated the 

response to an energy emergency would depend on the situation, and 

they have the expertise to respond if needed. Officials at Eielson Air 

Force Base, Alaska, stated that the installation does not have a formal 

energy emergency preparedness and operations plan, but they receive 

quarterly vulnerability analyses from the inspector general’s office and 

have a contingency response plan in the case of a power outage. 

However, in cases where an installation did not have formal or specific 

energy security documentation, we found that the requirements of the 

OSD Energy Policy Memorandum were incorporated into installation-wide 

plans, such as continuity of operations plans.

During our site visits in Alaska and Hawaii, we identified three areas of 

risk to energy security regarding funding, installation electricity systems, 

and cost. Specifically, we found that military services’ funding processes 

may limit energy security projects’ ability to compete for funding, the 

introduction of renewable energy may affect installation electricity 

systems, and the high cost of energy may be difficult for installations to 

sustain over the long term.

First, we found that military services’ funding processes may limit the 

ability of the installations to obtain funding for energy security projects. 

DOD Directive 4180.01, DOD Energy Policy, states that it is DOD policy 

to, among other things, improve energy security and that the Deputy 

Undersecretary of Defense for Installations and Environment should 

ensure cost-effective investments are made in facility infrastructure to, 

among other things, enhance the power resiliency of installations.24 In 

addition, DOD Instruction 4170.11, Installation Energy Management, 

states that DOD components shall take necessary steps to ensure the 

security of energy and water resources.25

 24DOD Directive 4180.01, DOD Energy Policy (Apr. 16, 2014). 

25DOD Instruction 4170.11, Installation Energy Management (Dec. 11, 2009).

Some Areas of Energy 

Security Risk Remain, and 

the Military Services Are 

Taking Some Actions to 

Mitigate Them
Page 26 GAO-16-164 DOD Energy Management

However, across the military services, officials told us that energy security 

projects do not compete well for funding because there is no clarity 

regarding the role that energy security plays in military service processes 

when evaluating a project for funding. In May 2014, we reported that the 

military services use “scoring” processes to consider projects for funding. 

During these “scoring” processes, DOD officials assign numerical 

values—or “points”—to certain project characteristics; potential projects’

relative scores are used to rank the projects; and senior decision makers 

at the military services’ headquarters review the rank-order list, selecting 

projects based on service priorities.26 However, energy security is 

generally not included in this list of project characteristics. In addition, 

since energy security projects are not identified in the decision-making

processes, there is no way of knowing how many of the projects do not 

obtain funding.

Officials at six of the nine locations we visited or contacted cited difficulty 

obtaining funding for energy security or would like to see dedicated 

funding for energy security projects. For example, officials overseeing the 

Air Force’s Alaska Radar System stated that they have sought military 

construction funding since 2002 to build a networked system of multiple 

fuel tanks, referred to as a tank farm, at three off-grid locations that each 

has only one large fuel tank. According to officials, if any of the current 

tanks were to fail, then the sites would lose all of their fuel for the year 

(see fig. 8). Officials stated that the projects would replace the large fuel 

tank with a multi-tank system. However, the officials said they are having 

difficulties obtaining funding because energy security projects do not 

compete well against other military construction projects, such as those 

for new facilities or mission-critical activities. According to officials, the 

tanks are now close to the point of failure. Also, an official at Marine 

Corps Base Hawaii stated that difficulty getting funding for aging 

equipment is the biggest vulnerability to the energy system. According to 

the official, plans to replace the aging equipment keep getting postponed 

in order to provide for other funding priorities. This official also noted that 

if older energy equipment is broken, it can be difficult to find 

replacements. In addition, Army officials at Fort Wainwright in Alaska 

stated that it is difficult to obtain military construction funding for current 

mission needs, including energy security projects, versus new mission 

needs. Navy officials at Joint Base Pearl Harbor Hickam also stated that 

 26GAO-14-446.
Page 27 GAO-16-164 DOD Energy Management

the energy security projects they submit for funding do not compete well. 

For example, they said that energy security projects—which have 

significant infrastructure costs—do not compete well for funding against 

energy conservation efforts based on return on investment.

Figure 8: Single Large Fuel Tank at Alaska Radar System Site

Additionally, all four military services’ energy headquarters offices told us 

that there is no specific military service or OSD guidance or clarity on 

energy security funding. As a result, military service officials told us that 

they had difficulty incorporating energy security into funding decisions. 

For example, Air Force officials stated that the Air Force Civil Engineer 

Command wanted to allow for a tradeoff between cost effectiveness and 

energy security when considering a new renewable energy project that 

could incorporate energy security features, such as a microgrid. However, 

the officials said they do not yet have the right criteria to define that 

tradeoff and to conduct that level of decision making. Moreover, a Marine 

Corps Headquarters official stated that, although the Marine Corps has a 

process in place to identify energy security vulnerabilities and mitigating 
Page 28 GAO-16-164 DOD Energy Management

actions, it can be difficult to get funding for energy security projects 

because there is no DOD requirement for energy security. In other words, 

there is no specific DOD requirement that identifies the level of energy 

security an installation should have. The official further stated that energy 

security projects, such as a microgrid or power plant, cannot compete 

well against energy efficiency or renewable energy projects that have a 

return on investment. Army officials similarly noted that energy security 

projects do not compete as well as other projects for funding based on 

return on investment, and it would be helpful to have criteria (project 

characteristics) for energy security project funding consideration. The 

Navy has made limited efforts to incorporate energy security into funding 

decisions, but officials told us that the efforts are rudimentary. For 

example, the Navy’s energy-Return on Investment tool, which it uses to 

assess energy projects, considers energy security in its calculations. 

However, a Navy Headquarters official told us that energy security is 

considered a “soft benefit,” or benefit that is not the central focus of the 

project, and that it is difficult to fund a large project based only on soft 

benefits.

Officials at installations told us that, without clarification of how energy 

security is considered in military service funding decisions, they have to 

try different approaches in their attempts to fund energy security projects. 

For example, Navy officials in Hawaii stated that they tried for 10 years to 

get funding for grid consolidation at the Pacific Missile Range Facility, but 

were not able to until it was shown that grid consolidation will allow the 

base to potentially build and then hook up to a landfill gas renewable 

energy plant. In Alaska, Air Force officials stated that difficulties obtaining 

military construction funding have led Air Force officials to work with 

attorneys at the Pacific Air Force Command to assess the viability of 

alternative sources of funding to build tank farms at the three off-grid 

Alaska Radar System locations that have only one large fuel tank each. 

However, as we have previously reported, alternatives to military 

construction funding have limitations, may vary in availability, and can be 

complex and time-consuming.27 As a result, this approach may not result 

in a funded project, or it may ultimately take longer than the traditional 

military construction process to fund a project. Without clarification of the 

processes the military services use to compare and prioritize projects for 

 27GAO, Renewable Energy Project Financing: Improved Guidance and Information 

Sharing Needed for DOD Project-Level Officials, GAO-12-401 (Washington, D.C.: Apr. 4, 

2012). 
Page 29 GAO-16-164 DOD Energy Management

funding to include consideration of energy security, it will be difficult for 

decision makers to have sufficient information to adequately prioritize 

energy security projects for funding when appropriate and thus address 

energy security issues.

Second, we found that the introduction of renewable energy sources may 

affect the stability of remote or small installation electricity systems, but 

the military services are taking some steps to address this risk. DOD 

Directive 4180.01 calls for the diversification and expansion of DOD 

energy supplies and sources, including renewable energy sources.28

Military service officials we spoke with generally stated that it is difficult to 

integrate intermittent sources of renewable energy (e.g., solar and wind 

power) into existing infrastructure. For example, in Hawaii, Navy and 

Army officials stated that because the amounts of intermittent renewable 

energy can vary significantly, it can cause fluctuations in power quality 

such as voltage and frequency on small or isolated electricity systems, 

which can damage equipment connected to them. These officials noted 

that the amount of electricity generated from solar and wind systems can 

vary significantly with ambient conditions such as cloud cover and wind 

speed. In Alaska, Air Force officials explained that many of the radar sites 

are in locations rated with high potential for wind turbines. However, the 

officials said the wind is too turbulent at these locations, such that the 

wind has knocked down a wind turbine prototype that was developed. 

Furthermore, even if wind energy generation was an option, the officials 

explained that because the microgrids at these sites are so small, adding 

wind turbines for electrical generation could cause disruptions in the 

electrical frequency of the grid.

Despite the potential challenges with integrating renewable energy 

sources at energy-remote installations, officials told us that efforts are 

underway, including studies on the incorporation of intermittent energy 

sources, to continue to increase the use of renewable energy resources 

at these locations and mitigate the integration risks. For example, officials 

at Marine Corps Base Hawaii told us that they reached out to the Naval 

Facilities Engineering Command to conduct studies within the next year 

to enable the installation to incorporate its expanding production of 

renewable energy. The installation is currently in the process of executing 

a power purchase agreement for two megawatts of solar photovoltaic 

 28DOD Directive 4180.01, DOD Energy Policy (Apr. 16, 2014).
Page 30 GAO-16-164 DOD Energy Management

arrays on rooftops and car ports. Almost all of the installation housing is 

owned by a private developer and has solar photovoltaic panels on the 

rooftops. Marine Corps Base Hawaii is working on an agreement with the 

developer to purchase excess solar photovoltaic power generated from 

the housing. In addition, Marine Corps Base Hawaii is conducting a gridmodeling study—expected to be completed in a year—to see the effect of 

integrating solar energy into the energy system.

Third, we found that the high cost of energy at remote locations may be 

difficult for installations to sustain over the long term and thus could affect 

overall mission assurance across the department, but DOD has 

conducted studies or taken actions to reduce costs. DOD Directive 

4180.01 states that it is the department’s policy to, among other things, 

mitigate costs in its use and management of energy.29 Army officials at 

Fort Greely in Alaska told us that their biggest challenge is the high cost 

of energy and expressed concern that it may become increasingly difficult 

for the Army to sustain the high costs in the long term. Paying these highcost energy bills could potentially force the military services to make 

tradeoffs in a constrained budgetary environment. Fort Greely officials 

stated that the Army hired a contractor to conduct a study to identify 

alternative energy solutions to lower costs and still provide energy 

security. Officials at Fort Wainwright also mentioned the high cost of 

utilities, noting that they pay $79 per ton for coal—more than double the 

U.S. average price for coal.30 They stated that it was the primary reason 

for hiring the same contractor as Fort Greely to identify alternative energy 

options for their installation as well. Both studies were completed in 

August 2015 and identified numerous potential energy conservation 

measures and recommendations. As of September 2015, senior Army 

officials were reviewing the recommendations to determine which to 

implement. In Hawaii, Navy officials told us that high oil prices in 2008 

greatly increased the energy costs at Joint Base Pearl Harbor Hickam, 

such that the base temporarily had to shut down some facilities because 

the energy costs were too high. Since then, officials stated the Navy has 

instituted renewable energy projects and energy conservation efforts to 

help lower energy costs. Also, Air Force officials stated that they are 

concerned with the high cost of energy, which ranges from $75,000 to 

 29DOD Directive 4180.01, DOD Energy Policy (Apr. 16, 2014).

30According to the U.S. Energy Information Administration, the U.S. average price for coal 

per ton in 2013 was $37.24. 
Page 31 GAO-16-164 DOD Energy Management

$100,000 per month, at Kaena Point in Hawaii, and they are working to 

lower costs through energy conservation efforts to help ensure access to 

electricity in the future.

The ability of DOD to effectively manage energy at its installations is an 

important element of mission assurance, and comprehensive 

measurement of facility energy could help the department maintain an 

aggressive pace toward its larger energy objectives. Through its Energy 

Report, DOD is required to track certain energy conservation measures, 

investments, and performance against established goals, as well as 

identify certain activities to enhance energy security and resilience. 

However, DOD’s process for preparing the Energy Report did not ensure 

it addressed all the statutory requirements. In addition, while DOD has 

taken steps to help ensure data quality in its Energy Report, the military 

services and defense agencies capture and report using different 

methods; thus, data are not comparable. Without reexamining the 

process for producing the Energy Report to help ensure it fully complies 

with statutory requirements, providing more consistent guidance to the 

installations, and identifying in the Energy Report instances in which data 

may not be comparable among the military services and defense 

agencies and the reasons why, it will be difficult for decision makers in 

DOD to plan effectively for steps to reach energy goals, and Congress will 

have limited oversight of the department’s energy consumption and 

difficulty in comparing energy projects among those reporting.

Moreover, the ability of the military services to effectively secure energy 

at their energy-remote installations is essential to avoid serious and 

potentially crippling operational impacts. The military services have taken 

reasonable steps, such as conducting studies on the incorporation of 

intermittent renewable energy sources and identifying alternative energy 

solutions, to overcome grid stability issues and high energy costs. 

However, the military services remain at risk for potentially underfunding 

energy infrastructure investments because there is no clarity regarding 

the role that energy security plays when evaluating a project for funding. 

Without clarifying the processes used to compare and prioritize military 

construction projects for funding, to include consideration of energy 

security as appropriate, it will be difficult for decision makers to have 

sufficient information to adequately prioritize energy security projects and 

thus address energy security issues.

Conclusions
Page 32 GAO-16-164 DOD Energy Management

We recommend the Secretary of Defense take the following four actions:

To better provide Congress with information needed to conduct oversight 

and make decisions on programs and funding, we recommend that the 

Secretary of Defense direct the Assistant Secretary of Defense for 

Energy, Installations and Environment to reexamine the process for 

producing the Energy Report to help ensure it complies with statutory 

requirements, and update it as appropriate. This includes reexamining the 

process to include required energy goals, descriptions of energy projects 

funded by appropriations and third parties, details of utility outages at 

military installations, and a description of the types and amount of 

financial incentives received.

In order to improve the consistency of certain data submitted by the 

military services and defense agencies to the Office of the Secretary of 

Defense and reported in the Energy Report, we recommend that the 

Secretary of Defense direct the secretaries of the Army, Navy, and Air 

Force, the Commandant of the Marine Corps, the heads of the defense 

agencies, and the Assistant Secretary of Defense for Energy, Installations 

and Environment to work together to

• provide more consistent guidance to the installations, including clearly 

stating the energy reporting requirements for tenant and host facilities, 

energy projects, and end-of-fiscal-year data, and

• identify in the Energy Report instances in which data may not be 

comparable among the military services and defense agencies and 

the reasons why.

To better provide the military services with information needed to make 

decisions on the prioritization of funding, we recommend that the 

Secretary of Defense direct the secretaries of the Army, Navy, and Air 

Force and the Commandant of the Marine Corps to clarify the processes 

used to compare and prioritize military construction projects for funding, 

including how and when to include consideration of energy security.

We provided a draft of this report for review and comment to DOD. In 

written comments, DOD concurred with all recommendations. DOD’s 

comments are summarized below and reprinted in their entirety in 

appendix III. DOD also provided technical comments, which we 

incorporated as appropriate.

Recommendations for 

Executive Action

Agency Comments 

and Our Evaluation
Page 33 GAO-16-164 DOD Energy Management

DOD concurred with our first recommendation to reexamine the process 

for producing the Energy Report to help ensure it complies with statutory 

requirements. In its response, DOD said the Office of the Assistant 

Secretary of Defense for Energy, Installations, and Environment is 

already taking action to ensure the next annual energy report complies 

with the requirements of the recently amended section 2925 of Title 10 of 

the United States Code.31

DOD also concurred with our second and third recommendations—which, 

in its comments, DOD combined into one response—that DOD provide 

more consistent guidance to the installations for the Energy Report and 

identify in the Energy Report instances in which data may not be 

comparable among the military services and defense agencies. DOD 

stated that the Office of the Assistant Secretary of Defense for Energy, 

Installations, and Environment will work with the military services in fiscal 

year 2016 to provide more consistent guidance to military installations 

and will identify in the fiscal year 2016 Energy Report where data may not 

be compatible. 

DOD further concurred with our final recommendation that the military 

services clarify the processes used to compare and prioritize military 

construction projects for funding, including how and when to include 

consideration of energy security. DOD noted that it is pursuing an update 

to DOD Instruction 4170.11, Installation Energy Management, and plans 

to include guidance to prioritize funding decisions consistent with this 

recommendation.

If enacted, we believe that DOD’s proposed actions will aid decision 

makers in DOD to plan effectively for steps to reach energy goals and 

address energy security issues, as well as provide Congress with better 

oversight of the department’s energy consumption.

 31The National Defense Authorization Act for Fiscal Year 2016, Pub. L. No. 114-92 (2015),

changed several of the reporting elements for the Energy Report required in section 2925 

of Title 10 of the United States Code. Among others, the fourth requirement on renewable 

energy certificates was removed. As such, we removed from our recommendation that 

DOD reexamine the process to include information on renewable energy certificates 

associated with energy projects financed through third-party mechanisms, which we had 

originally included in the recommendations sent to DOD in our draft report. The remainder 

of our recommendation is unchanged.
Page 34 GAO-16-164 DOD Energy Management

We are sending copies of this report to the appropriate congressional 

committees; the Secretary of Defense; the Secretaries of the Army, Navy, 

and the Air Force; the Assistant Secretary of Defense for Energy, 

Installations, and Environment; and the Commandant of the Marine 

Corps. In addition, the report is available at no charge on the GAO 

website at http://www.gao.gov.

If you or your staff have any questions about this report, please contact 

Brian Lepore at (202) 512-4523 or leporeb@gao.gov or Frank Rusco at 

(202) 512-3841 or ruscof@gao.gov. Contact points for our Offices of 

Congressional Relations and Public Affairs may be found on the last page 

of this report. GAO staff who made key contributions to this report are 

listed in appendix IV.

Brian J. Lepore

Director, Defense Capabilities and Management

Frank Rusco

Director, Natural Resources and Environment
Page 35 GAO-16-164 DOD Energy Management

List of Committees

The Honorable John McCain

Chairman

The Honorable Jack Reed

Ranking Member

Committee on Armed Services

United States Senate

The Honorable Thad Cochran

Chairman

The Honorable Richard J. Durbin

Ranking Member

Subcommittee on Defense

Committee on Appropriations

United States Senate

The Honorable Mark Kirk

Chairman

The Honorable Jon Tester

Ranking Member

Subcommittee on Military Construction, Veterans’ Affairs, and Related 

Agencies

Committee on Appropriations

United States Senate

The Honorable Mac Thornberry

Chairman

The Honorable Adam Smith

Ranking Member

Committee on Armed Services

House of Representatives

The Honorable Rodney Frelinghuysen

Chairman

The Honorable Pete Visclosky

Ranking Member

Subcommittee on Defense

Committee on Appropriations

House of Representatives
Page 36 GAO-16-164 DOD Energy Management

The Honorable Charles Dent

Chairman

The Honorable Sanford Bishop, Jr.

Ranking Member

Subcommittee on Military Construction, Veterans’ Affairs, and Related 

Agencies

Committee on Appropriations

House of Representatives
Appendix I: Objectives, Scope, and 

Methodology

Page 37 GAO-16-164 DOD Energy Management

The objectives of our review were to examine the extent to which (1) the 

Department of Defense (DOD) addressed the 12 required reporting 

elements and reliably reported data in its fiscal year 2013 Annual Energy 

Management Report (Energy Report) and (2) the military services helped 

ensure energy security at energy-remote military installations in the 

United States.

To determine the extent to which DOD addressed the 12 required 

reporting elements in its Energy Report, two GAO analysts independently 

reviewed the fiscal year 2013 Energy Report, comparing it with each 

element required by the law and determining whether each required 

reporting element was included. In the case of any conflicting 

determinations, a third GAO analyst adjudicated the difference. To gain a 

full understanding of the elements included in the Energy Report and to 

discuss the methodology used for collecting information and reporting on 

the required elements, we met with DOD officials knowledgeable about 

compiling information for the report, including individuals from the Office 

of the Secretary of Defense (OSD)—specifically, the Assistant Secretary 

of Defense for Energy, Installations, and Environment; the four military 

services; and the 10 defense agencies that contributed to the report.1 We 

also compared information in the fiscal year 2013 Energy Report to that in 

the fiscal year 2014 Energy Report, which was published in May 2015, to 

evaluate if the structure and content of each report was similar. Further, 

we compared OSD’s process for annually updating its Energy Report to 

criteria regarding updating internal control activities in Standards for 

Internal Control for the Federal Government.

2

To determine the extent to which DOD reliably reported energy data in its 

Energy Report, we reviewed the energy data and other inputs each 

military service and defense agency provided to be included in the Energy 

Report. We looked for any anomalies in the data, such as missing data 

 1

The fiscal year 2013 Energy Report included the facility energy activities of the four 

military services—Army, Navy, Air Force, and Marine Corps—and the following Defense 

Agencies: Defense Contract Management Agency, Defense Commissary Agency, 

Defense Finance and Accounting Service, Defense Intelligence Agency, Defense 

Logistics Agency, Missile Defense Agency, National Geospatial-Intelligence Agency, 

National Reconnaissance Office, National Security Agency, and Washington 

Headquarters Services.

2

GAO, Standards for Internal Control in the Federal Government, GAO/AIMD-00-21.3.1

(Washington D.C.: November 1999).

Appendix I: Objectives, Scope, and 

Methodology
Appendix I: Objectives, Scope, and 

Methodology

Page 38 GAO-16-164 DOD Energy Management

fields or numerical outliers. To examine if the data and other inputs were 

correctly reflected, we then compared the data and other inputs from 

each military service and defense agency to the published Energy Report, 

using as criteria GAO’s Standards for Internal Control in the Federal 

Government and DOD’s Annual Energy Management Report Fiscal Year 

2013 Reporting Guidance.

3 We also interviewed the officials who 

contributed to the report from OSD, the four military services, and the 10 

defense agencies regarding how the data was collected, measures taken 

to assure the reliability of the data, and any anomalies observed in the 

data.

In addition, we sent a structured questionnaire to knowledgeable officials 

from the four military services and 10 defense agencies to collect 

information about how facilities within each military service and defense 

agency reported energy consumption, energy projects, and September 

2013 end-of-fiscal-year energy consumption data included in the Energy 

Report. We received responses from all of the military services and 

defense agencies. Additionally, as part of the questionnaire, we asked the 

military services and defense agencies to provide data from a 

nongeneralizable sample of installations regarding September 2013 

energy consumption reported in the Energy Report and actual energy 

consumption used, as verified via utility bill or meter reading. To 

determine our sample, we collected a random sample of 10 installations 

each from the Army, Navy, Air Force, and Defense Commissary Agency; 

5 installations from the Marine Corps; and all installations from the 

remaining defense agencies in our scope. To minimize errors that might 

occur from respondents interpreting our questions differently than we 

intended, we pre-tested the questionnaire with knowledgeable 

representatives from one military service (Army) and one defense agency 

(National Reconnaissance Office). During these pre-tests, we discussed 

the questions and instructions with the officials to check whether (1) the 

questions and instructions were clear and unambiguous, (2) the terms 

used were accurate, (3) the questionnaire was unbiased, and (4) the 

questionnaire did not place an undue burden on the officials completing it. 

We also submitted the questionnaire for review by an independent GAO 

survey specialist. We modified the questionnaire based on feedback from 

the pre-tests and reviews, as appropriate.

 3 GAO/AIMD-00-21.3.1; DOD, Annual Energy Management Report Fiscal Year 2013 

Reporting Guidance (July 2013).
Appendix I: Objectives, Scope, and 

Methodology

Page 39 GAO-16-164 DOD Energy Management

To determine the extent that the military services helped ensure energy 

security at energy-remote military installations in the United States, we 

first determined the scope of energy-remote military installations by 

evaluating electrical interconnectedness and robustness. First, to review 

interconnectedness, we conducted preliminary research on the U.S. 

electric power system. We determined that Alaska and Hawaii have 

limited interconnectedness because they are not connected to the three 

power grids in the 48 contiguous states, which are interconnected to each 

other. Moreover, the electrical systems in Alaska and Hawaii are not 

connected to each other. Second, once we identified these states, we 

attempted to further narrow the scope by determining which areas in 

Alaska and Hawaii are less “electrically robust” (smaller number of power 

plants and transmission lines in the area surrounding the installation or no 

connectivity to transmission lines—e.g., an installation that uses diesel 

generators for primary power) and therefore more energy-remote. Using 

mapping software, we created maps of Alaska and Hawaii using layers of 

data (transmission lines, power plant data, and military installations 

location data). Additionally, we sent a questionnaire to each installation in 

Alaska and Hawaii to gather preliminary information, including the 

presence and location of the designated facility energy manager or 

another official who is tasked with performing the duties of the facility 

energy manager, the source(s) of electricity consumed on site, the 

amount of electricity consumed on site during fiscal year 2014, the 

supplier of this electricity, the existence (if any) of an energy security plan 

focused on utility resilience in case of an electrical disruption, whether an 

energy security assessment has been conducted, and whether there are 

plans to develop an energy security plan or conduct an energy security 

assessment in the future. Based on our assessment, all 26 installations in 

Alaska and 35 installations in Hawaii were included in our scope. Table 2 

lists the locations we visited or contacted to meet with facility energy 

managers and the number of associated installations they oversaw.
Appendix I: Objectives, Scope, and 

Methodology

Page 40 GAO-16-164 DOD Energy Management

Table 2: Locations Visited or Contacted and Number of Associated Installations 

Locations visited or contacted Number of associated installations

Alaska 26

Clear Air Force Station 1

Eielson Air Force Base 5

Joint Base Elmendorf-Richardson 17a 

Fort Greely 1

Fort Wainwright 1

Southeast Alaska Acoustic Measurement Facility 1

Hawaii 35

Joint Base Pearl Harbor Hickam 16b

Marine Corps Base Hawaii 6

U.S. Army Garrison Hawaii 13

Source: GAO. | GAO-16-164

Notes: We visited or contacted the facility energy manager(s) at each location and discussed with 

them the associated installations they oversaw.

a

We met with both the facility energy managers for Joint Base Elmendorf-Richardson and Alaska 

Radar System during our visit to the installation. Alaska Radar System has 20 installations, but 4 

locations are outside of Alaska.

b

We met with the facility energy managers for Joint Base Pearl Harbor Hickam, Barking Sands 

Communications Station, Bellows Air Force Station, and Kaena Point Satellite Tracking Station during 

our visit to the installation. Joint Base Pearl Harbor Hickam has 13 associated installations.

Additionally, we interviewed the facility energy managers responsible for 

all of the installations in Alaska and Hawaii to identify the procedures, 

equipment, and plans in place to ensure energy security on site, as well 

as any planned future energy security assessments. We compared their 

actions to relevant DOD and military service regulations and guidance on 

their roles and responsibilities regarding energy security, including DOD’s 

Energy Report, DOD installation energy guidance, and military service 

energy security guidance. We also interviewed military service officials to 

discuss their efforts and potential progress regarding helping to ensure 

energy security at energy-remote military installations.

We conducted this performance audit from March 2015 to January 2016 

in accordance with generally accepted government auditing standards. 

Those standards require that we plan and perform the audit to obtain 

sufficient, appropriate evidence to provide a reasonable basis for our 

findings and conclusions based on our audit objectives. We believe that 

the evidence obtained provides a reasonable basis for our findings and 

conclusions based on our audit objectives.
Appendix II: GAO Assessment of the Extent to 

Which the Annual Energy Management Report 

Addressed the Required Reporting Elements

Page 41 GAO-16-164 DOD Energy Management

Required reporting elements and GAO comments Our assessment

1. A description of the progress made to achieve the goals of the Energy Policy Act of 2005 (Pub. L. 

No. 109–58), section 2911(e) of Title 10 of the United States Code, section 553 of the National Energy 

Conservation Policy Act (codified in relevant part at 42 U.S.C. § 8259b), the Energy Independence 

and Security Act of 2007 (Pub. L. No. 110–140), and the energy performance goals for the 

Department of Defense during the preceding fiscal year.

The report described the progress made to achieve three of five goals during fiscal year 2013. Specifically, 

the report described progress made to achieve the goals of the Energy Policy Act of 2005, section 2911(e) 

of Title 10 of the United States Code, and DOD’s Energy Performance Master Plan.

For section 553 of the National Energy Conservation Policy Act, the report did not describe how DOD 

procured Energy Star or Federal Energy Management Program-designated products. According to the 

department, this requirement was addressed in past Energy Reports. DOD now includes it instead in DOD’s 

Strategic Sustainability Performance Plan. OSD officials stated this requirement more appropriately aligns to 

sustainability goals, and the department coordinates its Energy Report with the Strategic Sustainability 

Performance Plan to reduce redundant reports and requirements. However, this required reporting element 

was not included in DOD’s Energy Report and DOD did not identify that the information could be found 

elsewhere.

For the Energy Independence and Security Act of 2007, the report did not describe one of the three required 

goals. The report described DOD’s progress to reduce facility energy by 24 percent relative to a fiscal year 

2003 baseline. It also described DOD’s progress to reduce petroleum consumption in non-tactical vehicles 

relative to a fiscal year 2005 baseline. However, it did not describe DOD’s progress to increase alternative 

fuel consumption by 10 percent in non-tactical vehicles relative to a fiscal year 2005 baseline. Although the 

report discusses alternative fuel use in non-tactical fleet vehicles, the status toward the goal is not 

described. According to the department, DOD includes a sentence on its status toward the goal in its 

Strategic Sustainability Performance Plan. However, this required reporting element was not included in 

DOD’s Energy Report and DOD did not identify that the information could be found elsewhere.

Partially addressed

2. A table detailing funding, by account, for all energy projects funded through appropriations.

The report includes a table that identifies funding for appropriated energy projects. However, the table does 

not detail the funding by account. According to OSD officials, the report considered energy conservation, 

renewable energy, or water conservation as accounts for reporting purposes. However, this explanation 

differed from the instructions provided to the military services and defense agencies, in which funding 

accounts were defined as operation and maintenance, working capital funds, and military construction, 

among others. In contrast, the instructions defined energy conservation, renewable energy, or water 

conservation as project type. Moreover, in DOD’s Financial Management Regulation, the term “accounts” is 

generally used to refer to an appropriation (department code, fiscal year, and appropriation symbol)—i.e., 

appropriation accounts such as Operation and Maintenance, Army; the Defense Working Capital Fund; or 

Military Construction, Air Force.a

Partially addressed

Appendix II: GAO Assessment of the Extent to 

Which the Annual Energy Management Report 

Addressed the Required Reporting Elements
Appendix II: GAO Assessment of the Extent to 

Which the Annual Energy Management Report 

Addressed the Required Reporting Elements

Page 42 GAO-16-164 DOD Energy Management

Required reporting elements and GAO comments Our assessment

3. A table listing all energy projects financed through third party financing mechanisms (including 

energy savings performance contracts, enhanced use leases, utility energy service contracts, utility 

privatization agreements, and other contractual mechanisms), the duration of each such 

mechanism, an estimate of the financial obligation incurred through the duration of each such 

mechanism, whether the project incorporates energy security into its design, and the estimated 

payback period for each such mechanism.

The report includes a table that identifies non-governmental third-party-funded energy projects, which 

identifies projects as either energy savings performance contracts or utility energy service contracts. 

However, this table does not include the duration of each such mechanism, an estimate of the financial 

obligation incurred through the duration of each such mechanism, whether the project incorporates energy 

security into its design, and the estimated payback period for each such mechanism. OSD officials stated 

that some of this information was not included in the public report due to public release concerns, but that 

the information exists in a supplemental workbook that has been previously provided to Congress upon 

request. However, the officials did not identify public release concerns in the Energy Report to clarify why it 

did not include required elements.

Partially addressed

4. In addition to the information contained in the table listing energy projects financed through third 

party financing mechanisms, as required by paragraph (3), the table also shall list any renewable 

energy certificates associated with each project, including information regarding whether the 

renewable energy certificates were bundled or unbundled, the purchasing authority for the 

renewable energy certificates, and the price of the associated renewable energy certificates.b

The report did not include a table listing renewable energy certificates associated with each project financed 

through third-party financing mechanisms. The report did not address unbundled renewable energy 

certificates. The report did state that, in fiscal year 2013, the department did not have any new bundled 

renewable energy certificates. However, our analysis found at least three renewable energy projects that 

had associated renewable energy certificates. For example, a 2.06 megawatt solar photovoltaic system at 

the U.S. Army Garrison in Adelphi, Maryland is expected to retain approximately 2,500 renewable energy 

certificates annually.

We found that these renewable energy certificates were not identified because DOD did not require the 

military services and defense agencies to report on renewable energy certificates associated with two types 

of third-party financing mechanisms: utility energy service contracts and energy savings performance 

contracts. According to OSD officials, they did not require information on renewable energy certificates 

associated with these two contracts because they only comprise approximately 5 percent of all renewable 

energy projects. From the officials’ perspectives, the reporting requirement should focus on projects greater 

than 1 megawatt. However, as currently written, this required reporting element does not indicate a 

threshold amount for reporting renewable energy certificates, and some projects exceeding 1 megawatt 

were not reported. 

Not addressed

5. A description of the actions taken to implement the energy performance master plan in effect 

under section 2911 of Title 10 of the United States Code and carry out this chapter during the 

preceding fiscal year.

The report identifies the three goals of DOD’s energy performance master plan and performance towards 

meeting those goals.

Fully addressed

6. A description of the energy savings realized from such actions.

The report identifies DOD’s energy savings in relation to the target goals for energy efficiency, renewable 

energy, and petroleum consumption.

Fully addressed
Appendix II: GAO Assessment of the Extent to 

Which the Annual Energy Management Report 

Addressed the Required Reporting Elements

Page 43 GAO-16-164 DOD Energy Management

Required reporting elements and GAO comments Our assessment

7. An estimate of the types and quantities of energy consumed by the Department of Defense and 

members of the armed forces and civilian personnel residing or working on military installations 

during the preceding fiscal year, including a breakdown of energy consumption by user groups and 

types of energy, energy costs, and the quantities of renewable energy produced or procured by the 

Department.

The report estimates the types and quantities of energy consumed, including narrative and charts outlining 

energy consumption by user groups, energy consumption by type, energy costs, and quantities of 

renewable energy produced or procured.

Fully addressed

8. A description of the types and amount of financial incentives received under section 2913 of Title 

10 of the United States Code during the preceding fiscal year and the appropriation account or 

accounts to which the incentives were credited.

The report does not describe financial incentives. Title 10 U.S.C. §2913(c) states that “the Secretary of 

Defense may authorize any military installation to accept any financial incentive, goods, or services 

generally available from a gas or electric utility, to adopt technologies and practices that the Secretary 

determines are in the interests of the United States and consistent with the energy performance goals for 

the Department of Defense.”

According to the department, section 2913 is used as the authority for DOD to enter into certain third-partyfinanced energy conservation projects with servicing utility companies. OSD officials stated that the financial 

benefit received from these arrangements is the avoidance of appropriated capital needed for project 

implementation. They added that utility companies provide the capital and DOD pays back the capital 

investment over time using the savings realized from the implemented energy conservation projects. The 

OSD officials further stated that the report includes information on third-party-financed utility energy service 

contracts. However, the report did not describe the types and amounts of financial incentives received, if 

any, as indicated in the required reporting element.

Not addressed

9. A description and estimate of the progress made by the military departments to meet the 

certification requirements for sustainable green-building standards in construction and major 

renovations as required by section 433 of the Energy Independence and Security Act of 2007 (Pub. 

L. No 110–140).

The report states that the Department of Energy has not published the final regulation for implementing 

Section 433, adding that DOD will start reporting on this requirement after the Department of Energy issues 

the final rule. As of the time of this report, the Department of Energy had finalized regulations implementing 

certain parts of the rule, but other parts are still pending.

Fully addressed

10. A description of steps taken to determine best practices for measuring energy consumption in 

Department of Defense facilities and installations, in order to use the data for better energy 

management.

The report describes how the department measures energy consumption. 

Fully addressed

11. Details of utility outages at military installations including the total number and locations of 

outages, the financial impact of the outage, and measures taken to mitigate outages in the future at 

the affected location and across the Department of Defense.

The report identifies the approximate number, approximate cost, and general locations of utility outages at 

installations. However, as we found in July 2015, DOD’s collection and reporting of utility disruption data is 

not comprehensive and contains inaccuracies, because not all types and instances of utility disruptions 

have been reported and there are inaccuracies in reporting of disruptions’ duration and cost.c

Partially addressed

12. A description of any other issues and strategies the Secretary determines relevant to a 

comprehensive and renewable energy policy.

The department stated that there were no other relevant issues determined for reporting purposes.

Fully addressed

Source: GAO analysis of DOD’s Annual Energy Management Report. | GAO-16-164

Notes: The National Defense Authorization Act for Fiscal Year 2016, Pub. L. No. 114-92 (2015), 

changed several of the required reporting elements. In particular, the fourth requirement on 
Appendix II: GAO Assessment of the Extent to 

Which the Annual Energy Management Report 

Addressed the Required Reporting Elements

Page 44 GAO-16-164 DOD Energy Management

renewable energy certificates and the seventh requirement on estimating the types and quantities of 

energy consumed were removed. The ninth requirement on sustainable green-building standards was

revised to require a description of progress toward meeting certain standards under the Unified 

Facilities Criteria. The eleventh requirement on utility outages was revised to require details of noncommercial utility outages and DOD-owned infrastructure. Additionally, a new requirement was added 

for the inclusion of a classified annex, as appropriate.

a

See, for example, definitions of chargeable account and funding account in the DOD Financial 

Management Regulation 7000.14, Glossary (April 2015).

b

In the United States, renewable energy production essentially creates two products: the energy itself 

and an associated commodity, called a renewable energy certificate, which represents a certain 

amount of energy generated using a renewable resource. Renewable energy certificates are bought 

and sold in a fashion similar to stocks and bonds.

c

GAO, Defense Infrastructure: Improvements in DOD Reporting and Cybersecurity Implementation 

Needed to Enhance Utility Resilience Planning, GAO-15-749 (Washington, D.C.: July 23, 2015).
Appendix III: Comments from the Department 

of Defense

Page 45 GAO-16-164 DOD Energy Management

Appendix III: Comments from the 

Department of Defense
Appendix III: Comments from the Department 

of Defense

Page 46 GAO-16-164 DOD Energy Management
Appendix III: Comments from the Department 

of Defense

Page 47 GAO-16-164 DOD Energy Management
Appendix IV: GAO Contacts and Staff 

Acknowledgments

Page 48 GAO-16-164 DOD Energy Management

Brian J. Lepore, (202) 512-4523 or leporeb@gao.gov

Frank Rusco, (202) 512-3841 or ruscof@gao.gov

In addition to the contacts named above, Laura Durland (Assistant 

Director), Jon Ludwigson (Assistant Director), Emily Biskup, Lorraine 

Ettaro, Emily Gerken, Terry Hanford, Alberto Leff, Amie Lesser, John 

Mingus, Jodie Sandel, Erik Wilkins-McKee, and Michael Willems made 

key contributions to this report.

Appendix IV: GAO Contacts and Staff 

Acknowledgments

GAO Contacts

Staff 

Acknowledgments
Related GAO Products

Page 49 GAO-16-164 DOD Energy Management

Defense Infrastructure: DOD Efforts Regarding Net Zero Goals. GAO-16-

153R. Washington, D.C.: January 12, 2016.

Defense Infrastructure: Improvements in DOD Reporting and 

Cybersecurity Implementation Needed to Enhance Utility Resilience 

Planning. GAO-15-749. Washington, D.C.: July 23, 2015.

Energy Savings Performance Contracts: Additional Actions Needed to 

Improve Federal Oversight. GAO-15-432. Washington, D.C.: June 17, 

2015.

High-Risk Series: An Update. GAO-15-290. Washington, D.C.: February 

11, 2015.

Climate Change Adaptation: DOD Can Improve Infrastructure Planning 

and Processes to Better Account for Potential Impacts. GAO-14-446. 

Washington, D.C.: May 30, 2014.

Clear Air Force Station: Air Force Reviewed Costs and Benefits of 

Several Options before Deciding to Close the Power Plant. GAO-14-550. 

Washington, D.C.: May 12, 2014.

Climate Change: Energy Infrastructure Risks and Adaptation Efforts. 

GAO-14-74. Washington, D.C.: January 31, 2014.

Renewable Energy Project Financing: Improved Guidance and 

Information Sharing Needed for DOD Project-Level Officials. 

GAO-12-401. Washington, D.C.: April 4, 2012.

Renewable Energy: Federal Agencies Implement Hundreds of Initiatives. 

GAO-12-260. Washington, D.C.: February 27, 2012.

Defense Infrastructure: DOD Did Not Fully Address the Supplemental 

Reporting Requirements in Its Energy Management Report.

GAO-12-336R. Washington, D.C.: January 31, 2012.

Electricity Grid Modernization: Progress Being Made on Cybersecurity 

Guidelines, but Key Challenges Remain to be Addressed. GAO-11-117. 

Washington, D.C.: January 12, 2011.

Defense Infrastructure: Department of Defense’s Energy Supplemental 

Report. GAO-10-988R. Washington, D.C.: September 29, 2010.

Related GAO Products
Related GAO Products

Page 50 GAO-16-164 DOD Energy Management

Defense Infrastructure: Department of Defense Renewable Energy 

Initiatives. GAO-10-681R. Washington, D.C.: April 26, 2010.

Defense Infrastructure: DOD Needs to Take Actions to Address 

Challenges in Meeting Federal Renewable Energy Goals. GAO-10-104. 

Washington, D.C.: December 18, 2009.

Defense Critical Infrastructure: Actions Needed to Improve the 

Identification and Management of Electrical Power Risks and 

Vulnerabilities to DOD Critical Assets. GAO-10-147. Washington, D.C.: 

October 23, 2009.

Energy Savings: Performance Contracts Offer Benefits, but Vigilance Is 

Needed to Protect Government Interests. GAO-05-340. Washington, 

D.C.: June 22, 2005.

(352021)
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