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56–839 PDF 2011

S. Hrg. 111–784 

CUTTING THE FEDERAL GOVERNMENT’S ENERGY 

BILL: AN EXAMINATION OF THE SUSTAINABLE 

FEDERAL GOVERNMENT EXECUTIVE ORDER 

HEARING 

BEFORE THE

FEDERAL FINANCIAL MANAGEMENT, GOVERNMENT 

INFORMATION, FEDERAL SERVICES, AND 

INTERNATIONAL SECURITY SUBCOMMITTEE 

OF THE

COMMITTEE ON 

HOMELAND SECURITY AND 

GOVERNMENTAL AFFAIRS 

UNITED STATES SENATE 

OF THE

ONE HUNDRED ELEVENTH CONGRESS 

SECOND SESSION 

JANUARY 27, 2010 

Available via http://www.gpoaccess.gov/congress/index.html 

Printed for the use of the 

Committee on Homeland Security and Governmental Affairs 

( 


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COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS 

JOSEPH I. LIEBERMAN, Connecticut, Chairman 

CARL LEVIN, Michigan 

DANIEL K. AKAKA, Hawaii 

THOMAS R. CARPER, Delaware 

MARK L. PRYOR, Arkansas 

MARY L. LANDRIEU, Louisiana 

CLAIRE MCCASKILL, Missouri 

JON TESTER, Montana 

ROLAND W. BURRIS, Illinois 

PAUL G. KIRK, JR., Massachusetts 

SUSAN M. COLLINS, Maine 

TOM COBURN, Oklahoma 

JOHN MCCAIN, Arizona 

GEORGE V. VOINOVICH, Ohio 

JOHN ENSIGN, Nevada 

LINDSEY GRAHAM, South Carolina 

ROBERT F. BENNETT, Utah 

MICHAEL L. ALEXANDER, Staff Director 

BRANDON L. MILHORN, Minority Staff Director and Chief Counsel 

TRINA DRIESSNACK TYRER, Chief Clerk 

SUBCOMMITTEE ON FEDERAL FINANCIAL MANAGEMENT, GOVERNMENT 

INFORMATION, FEDERAL SERVICES, AND INTERNATIONAL SECURITY 

THOMAS R. CARPER, Delaware, Chairman 

CARL LEVIN, Michigan 

DANIEL K. AKAKA, Hawaii 

MARK L. PRYOR, Arkansas 

CLAIRE MCCASKILL, Missouri 

ROLAND W. BURRIS, Illinois 

JOHN MCCAIN, Arizona 

TOM COBURN, Oklahoma 

GEORGE V. VOINOVICH, Ohio 

JOHN ENSIGN, Nevada 

JOHN KILVINGTON, Staff Director 

PETER TYLER, Professional Staff Member 

BRYAN PARKER, Staff Director and General Counsel to the Minority 

DEIRDRE G. ARMSTRONG, Chief Clerk 


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C O N T E N T S 

Opening statement: Page 

Senator Carper ................................................................................................. 1 

Prepared statement: 

Senator Carper ................................................................................................. 33 

Senator McCain ................................................................................................ 36 

WITNESSES 

WEDNESDAY, JANUARY 27, 2010 

Nancy Sutley, Chair, Council on Environmental Quality .................................... 5 

Richard Kidd, Program Manager, Federal Energy Management Program, U.S. 

Department of Energy ......................................................................................... 60 

Dorothy Robyn, Ph.D., Deputy Under Secretary of Defense, for Installations 

and Environment, U.S. Department of Defense ................................................ 9 

Sam Pulcrano, Vice President, Office of Sustainability, U.S. Postal Service ..... 12 

ALPHABETICAL LIST OF WITNESSES

Kidd, Richard: 

Testimony .......................................................................................................... 6 

Prepared statement .......................................................................................... 41 

Pulcrano, Sam: 

Testimony .......................................................................................................... 12 

Prepared statement .......................................................................................... 59 

Robyn, Dorothy, Ph.D.: 

Testimony .......................................................................................................... 9 

Prepared statement .......................................................................................... 52 

Sutley, Nancy: 

Testimony .......................................................................................................... 5 

Prepared statement .......................................................................................... 38 

APPENDIX 

Questions and responses for the Record from: 

Ms. Sutley ......................................................................................................... 70 

Mr. Kidd ............................................................................................................ 77 

Ms. Robyn .......................................................................................................... 96 

Mr. Pulcrano ..................................................................................................... 106 


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CUTTING THE FEDERAL GOVERNMENT’S 

ENERGY BILL: AN EXAMINATION OF 

THE SUSTAINABLE FEDERAL GOVERNMENT 

EXECUTIVE ORDER 

WEDNESDAY, JANUARY 27, 2010 

U.S. SENATE,

SUBCOMMITTEE ON FEDERAL FINANCIAL MANAGEMENT,

GOVERNMENT INFORMATION, FEDERAL SERVICES,

AND INTERNATIONAL SECURITY,

OF THE COMMITTEE ON HOMELAND SECURITY

AND GOVERNMENTAL AFFAIRS,

Washington, DC. 

The Subcommittee met, pursuant to notice, at 2:37 p.m., in room 

SD–342, Dirksen Senate Office Building, Hon. Thomas R. Carper, 

Chairman of the Subcommittee, presiding. 

Present: Senator Carper. 

OPENING STATEMENT OF SENATOR CARPER 

Senator CARPER. Good afternoon. The Subcommittee will come to 

order. 

My Republican colleagues are holding a one-day retreat off campus, but they are not too far away. But some of them may be coming in and joining us later this afternoon, but they are in retreat 

today—not full retreat, but—— [Laughter.] 

And, I might add, we are not, either. But we like to do things 

in a bipartisan basis in this Subcommittee and that is our history. 

Hopefully, we will be able to continue to do that. 

I am very excited about this hearing. It is one of those things 

when I think you actually mix good policy and good politics. Like 

Rutherford B. Hayes used to say, good policy makes for good politics, or something to that extent. We will see how this rolls, but 

we have a great panel of witnesses, and I am very excited about 

what you have to share with us. 

The last few years have underscored not only the need, but the 

opportunities for our Nation to rethink its energy use. Ever changing energy costs and our Nation’s severe economic problems have 

resulted in families and homeowners and businesses and local governments and schools all taking a hard look at how much they are 

spending. 

As a recovering governor—that is me—I know what it is like to 

be responsible for coming up with a budget and living within its 

constraints. Within State government, you have to make sure that 

you balance your budget every year. You have to make some tough 


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choices and look across government to find ways to do, in some 

cases, more with less. And the Federal Government should be no 

different, at least not remarkably different. Becoming more energy 

efficient is a clear way for the Federal Government not only to save 

money, but to also improve the quality of service that we provide 

to the American people. 

President Obama has recognized that the Federal Government 

can lead by example. In October, the President issued Executive 

Order 13514, calling for the Federal Government to step up its efforts to conserve energy by challenging agencies to meet a number 

of energy, water, and waste reduction targets. The Executive Order 

establishes a series of energy savings and other green government 

targets for the Federal Government. Each Federal agency is required to develop plans to reach those targets, and we expect initial 

reports on the status of those plans sometime later this year. 

In the meantime, we should start a dialogue about what the Executive Order means for not only our environment, but also for our 

Nation’s bottom line. This Subcommittee is always looking at the 

financial implications of new Federal ideas—sometimes old Federal 

ideas—and we have to explore some basic questions which I hope 

our witnesses will help us to do today, and among those basic questions are these. 

Will the Executive Order save taxpayers’ money? What are the 

costs and potential rewards associated with investing in energy efficiency or alternative energy strategies? Are there financial or bureaucratic challenges that Congress can address or at least help to 

address? In other words, if there are opportunities to save money 

through energy efficiency, why aren’t we moving more quickly? Is 

there something we can do about that? 

I should point out that we are talking here about not a little bit 

of money. Potentially, we are talking about a lot of money. And I 

should first note that the Federal Government is, I believe, the single largest energy user in the Nation, is that right? I see a nodding 

of heads. 

In fiscal year 2008, I am told the total energy consumption of the 

Federal Government in all of our buildings and operations was 

roughly 1.5 percent of all energy consumption in the United States. 

I wonder who is number two? The energy bill for the Federal Government that year was almost $25 billion, $24.5 billion, or almost 

one percent of total Federal expenditures. Of that roughly $25 billion, over $7 billion was spent on energy to operate Federal buildings alone. With a price tag that large, there are significant opportunities for savings of taxpayer dollars. 

During these times of mind-boggling budget deficits, the Federal 

Government needs to find every way it can to better manage its operations and finances, and we also need to find ways to put Americans back to work again. I would just sort of underscore or put an 

exclamation point at the end of those sentences. We ran up as 

much new deficit in our first 8 years in this decade as we did in 

the first roughly 208 years of our Nation’s history. And this last 

year, we are just coming off the heels of the largest single-year deficit that we have ever had in our Nation’s history. 

As we look ahead, the red ink doesn’t get much better. We are 

going to hear a lot, I think, tonight from the President about that, 


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which is a good thing. We are also going to hear tonight, I am sure, 

in his State of the Union a fair amount of discussion on what we 

are doing to try to put Americans back to work and what we ought 

to be doing to put Americans back to work. 

I just had a very interesting meeting with the CEO of Cummins. 

They make a lot of products, this technology and manufacturing 

company. They figured out that it is possible to do good and to do 

well at the same time, to reduce emissions, to make more energy 

efficient products, and to sell them all over the world. At a time 

and age when a lot of workforces are shrinking, here is a company 

that has increased its workforce by more than a quarter, maybe 

close to 50 percent. So it is possible to do good and to do well. They 

are actually a pretty good poster child for that. 

Our Federal Government occupies, I am told, nearly 500,000 

buildings of every shape and size, including buildings like this 

beautiful one that we are in today. We have more than, I am told, 

1.8 million civilians and we purchase more than $500 billion per 

year in goods and services. The scope of these assets presents opportunities for businesses and entrepreneurs to employ energy saving products and services that will save taxpayers money and provide a marketplace for innovation. 

So it is clear that we have an abundance of opportunities to lead 

by example in the Federal Government and that is what we need 

to do—lead. 

Today, we are blessed to have four very knowledgeable experts 

from the Federal Government—well, three, and one from sort of 

like a quasi-Federal Government entity, the Postal Service. But we 

have four very knowledgeable experts today with us to share some 

of their ideas on how we might provide the kind of leadership that 

is needed. 

The first two represent the overall picture of the Executive Order 

from the perspectives of the White House and the Department of 

Energy. The second two witnesses will describe the Executive 

Order from the perspective of a couple of very large entities, the 

Department of Defense and the U.S. Postal Service. 

Federal managers appear to want the Executive Order. A recent 

survey of Federal agency managers showed, I believe, two things. 

First, these managers say that green government ranks as high in 

importance as managing human capital and financial management. 

So managers see that taking steps like saving energy makes sense 

in a variety of ways. 

But second, more than half of the respondents to that survey 

said that creating a more green government requires more accountability and clear measures of success. I understand that these are 

key goals of the Executive Order. 

Before I close, I must mention a piece of very relevant legislation 

that our full Committee Ranking Member Susan Collins introduced 

last year. I am pleased to be a cosponsor, in fact an original cosponsor, of what is called the Federal Agency Energy Efficiency Improvement Act of 2009, which has many of the same goals of the 

Executive Order, and I believe it is complementary to it. Our legislation has already been approved by the full Committee, the Senate 

Homeland Security Committee and Governmental Affairs. We look 

forward to moving it through the full Senate. Although I will be 


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honest with you. I can introduce a resolution today that says today 

is Wednesday. I am not sure I could get 60 votes for it in the U.S. 

Senate. Things are tough. [Laughter.] 

But having said that, Senator Collins and I, we team up on a lot 

of stuff, and maybe we can get this one into the end zone. I hope 

so. 

In the next few weeks, I plan on introducing legislation to ensure 

that the money the Federal Government spends on improving 

building efficiency is reaching its full potential. New technology demands new skills, I might add, and I have introduced a new bill 

that I think would better ensure that the individuals who manage 

our Federal facilities receive the training they need in order to 

meet these new demands. 

With that having been said, I think we are going to get underway here. I am going to say a couple of words about each of our 

witnesses, not at any great length. I am just delighted that you are 

here, delighted that you have prepared for this. 

Our first witness is going to be Nancy Sutley. I was pleased to 

meet her here literally, I think, a year ago. She is the Chair of the 

President’s Council on Environmental Quality (CEQ), a position 

once held by former Delaware Governor Russell Peterson, who at 

the tender age of 92 is alive and going strong and doing great 

things for our environment and our State. But she is Chair of the 

President’s Council on Environmental Quality and works in the 

White House. She will discuss the Executive Order and what it 

means to the Federal Government and what it means for our Nation as a whole. The Council on Environmental Quality is a lead 

entity not only in designing the Executive Order, but also in its implementation. 

Our second witness is Richard Kidd. Mr. Kidd is the Program 

Manager of the Federal Energy Management Program residing in 

the Department of Energy. Mr. Kidd will discuss how agencies are 

responding to the Executive Order, what progress has been made, 

and what we can do to make even more progress in the future. 

Our next witness is Deputy Under Secretary Dorothy Robyn. She 

joins us from the Department of Defense. Ms. Robyn will discuss 

what progress the Department of Defense has made on the energy 

efficiency front. Far and away the largest consumer of energy in 

the Federal Government, the Department of Defense will provide 

clear examples of the challenges that agencies face in pursuing 

these goals. Currently, the Department of Defense accounts for, I 

am told, almost two-thirds of the energy consumed by Federal facilities and buildings. 

Our final witness is Sam Pulcrano, Vice President of Sustainability for the U.S. Postal Service. Mr. Pulcrano will discuss how 

the Postal Service long ago understood the business case for investing in energy efficiency for their operations. We just had a chance 

to meet yesterday with the Postmaster General. We talked about 

some of these issues. The Postal Service has been a real leader in 

this area, and by his position’s very existence, Mr. Pulcrano has 

proven that the Postal Service understands the value of making energy efficiency a part of their everyday business. 

We thank all the witnesses for being with us today. We will 

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1The prepared statement of Ms. Sutley appears in the Appendix on page 38. 

ment will be made part of the record. In fact, I have read your oral 

statement and it will probably fit within 5 minutes, but if you take 

more than 5 minutes, 6 or 7 minutes, that is OK. Then we will 

come back and do questions once everybody is finished with their 

testimony. Again, we are delighted you are all here. This is an important issue. Thanks for joining us. 

Ms. Sutley. 

TESTIMONY OF NANCY SUTLEY,1 CHAIR, COUNCIL ON 

ENVIRONMENTAL QUALITY 

Ms. SUTLEY. Thank you, Mr. Chairman, for holding this hearing 

and the opportunity to appear before you and the interest and enthusiasm the Subcommittee has for this issue. I will apologize up 

front. I am getting over a cold, so hopefully, I won’t start coughing 

in the middle of this. 

As you pointed out, the Federal Government is the single largest 

energy consumer in the United States. It owns more than 500,000 

buildings, more than 600,000 vehicles, and purchases more than 

$500 billion a year in goods and services. Given this impact and 

scope, the President recognizes that the Federal Government must 

be a leader in sustainability and in our efforts to build a clean energy economy. Cutting the Federal Government’s energy use will 

not only reduce our carbon footprint, but will also save taxpayers’ 

dollars. 

President Obama signed Executive Order 13514 on October 5 of 

last year. The Executive Order sets sustainability goals for Federal 

agencies and focuses on making improvements in environmental, 

energy, and economic performance. I would like to take this opportunity to thank all the agencies for their hard work and enthusiasm in implementing the goals of the Executive Order, including 

the agencies who are represented here today. Meeting these goals 

will reduce costs, reduce air and water pollution, and drive investments in local and clean energy jobs. 

The goals and strategies Federal agencies are developing will be 

in harmony with existing statutory energy efficiency requirements, 

such as those in the Energy Policy Act of 2005 and the Energy 

Independence and Security Act of 2007. In fact, statutory requirements such as metering and building recommissioning will help us 

meet these goals. 

In addition, the Executive Order for the first time requires Federal agencies to set a greenhouse gas pollution reduction target. 

The overall Federal Government-wide target will be the aggregate 

commitment of 35 Federal agencies. Achieving the reduction goal 

will be done through a combination of efforts, including becoming 

more energy efficient, reducing petroleum use in government fleets, 

and using more renewable energy. 

The investments made by Federal agencies will pay dividends for 

years to come in taxpayer savings. For example, achieving a 5 percent reduction in greenhouse gas emissions by 2020 from the current baseline would save an estimated $1.7 to $2.1 billion in avoided energy costs. 


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1The prepared statement of Mr. Kidd appears in the Appendix on page 41. 

Agencies are working towards achieving their targets by pursuing a number of strategies. These projects, many of which were 

made possible by Recovery Act funding, will drive long-term savings, build local market capacity, and create new private sector 

clean energy jobs. 

We know that inefficient energy use in buildings is a major contributor to Federal greenhouse gas emissions. Federal buildings 

provide significant opportunities for reducing emissions, and the effort is bolstered by the $5.5 billion provided in the Recovery Act to 

the General Services Administration (GSA) to renovate and build 

high-performance green Federal buildings. 

Looking forward, implementation of the Executive Order will 

focus on integrating achievement of sustainability goals with agency mission and strategic planning. The goal is to optimize performance and minimize costs. Detailed agency implementation plans 

are due in June 2010, when each Federal agency will deliver a 

strategic sustainability performance plan to CEQ and the Office of 

Management and Budget (OMB). Each plan will prioritize the 

agency’s action toward the goals of the Executive Order based on 

the return on investment. These sustainability plans will describe 

the specific actions agencies will take to achieve their individual 

greenhouse gas reduction targets, reduce energy costs, and meet 

other goals of the Executive Order. 

Finally, to ensure accountability, annual agency progress will be 

measured and reported online to the public by OMB through its 

scorecard process. By fulfilling this Executive Order, the Federal 

Government will demonstrate that economic performance and a 

healthy environment go hand in hand. 

Thank you again for the opportunity to be here today and I look 

forward to your questions. Thank you. 

Senator CARPER. Thank you, Ms. Sutley, very much, for your 

leadership, as well. Mr. Kidd, welcome. 

TESTIMONY OF RICHARD KIDD,1 PROGRAM MANAGER, FEDERAL ENERGY MANAGEMENT PROGRAM, U.S. DEPARTMENT 

OF ENERGY 

Mr. KIDD. Thank you. Good afternoon, Chairman Carper. We at 

Federal Energy Management Program are responsible for facilitating the Federal Government’s implementation of sound, cost-effective energy management and investment practices in order to 

enhance the Nation’s security and environmental stewardship. 

Today, we are examining Presidential Executive Order 13514, 

which establishes greenhouse gas emissions reduction as the overarching metric to guide Federal actions and investments. 

The most cost-effective way to achieve these reductions is 

through increased use of energy efficiency technologies applied in 

a whole system, sustainable manner. Not using energy is cheaper 

than buying energy, and the Federal Government, as the largest 

energy consumer in the country, buys a lot of energy—$25 billion 

worth in 2008. Of this amount, $7 billion was for energy costs in 

buildings, with associated greenhouse gas emissions of over 43 million metric tons of carbon dioxide equivalent. 


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1The chart referenced by Mr. Kidd appears in the Appendix on page 48. 

The good news, though, is that through energy efficiency improvements, we can reduce these emissions, avoid future costs, and 

generate positive attendant benefits, such as a healthier, more productive Federal workforce. 

Instead of costs and expenditures, think about energy efficiency 

as a stable, reliable source of future savings. For instance, in 2008, 

the Department of Energy avoided $140 million of its total energy 

costs as compared with 1985. The government’s energy intensity 

decreased 12.7 percent in 2009 from 2003. 

The private sector is already demonstrating the value of energy 

efficiency. Over a building’s 20-plus-year life, the owner is likely to 

pay more in energy costs than in construction costs. A 2 percent 

increase in the up-front costs can easily generate a tenfold savings 

over the life of the building. 

This applies to retrofits, as well. For example, the Empire State 

Building, well known to all Americans, is currently undergoing a 

$20 million retrofit that will save $4.4 million annually and reduce 

energy consumption by up to 38 percent. The retrofit of the Empire 

State Building will pay for itself in less than 6 years. 

The energy conservation measures chart shown here provides a 

few examples of historic payback periods for some of the energy efficiency and renewable technologies that have been applied 

throughout the Federal Government.1 Investing in each of these 

various technologies makes financial sense within a given payback 

period. 

Senator CARPER. Excuse me. Are you going to talk at all off of 

this slide? It is hard, I am sure, for some people to see. But if you 

want to take a minute and just walk us through a little bit of it— 

I have a hard copy up here, which is easier to see. 

Mr. KIDD. Sure. I would be happy to. 

Senator CARPER. Do you want to take just a minute and describe 

the relevance of this slide. 

Mr. KIDD. We have records of most of the major energy projects 

across the Federal Government that have been financed through 

what is called alternate financing, or Energy Savings Performance 

Contracts (ESPCs). In each of those contracts, there are identified 

measures with the associated savings. So we picked some of the 

dozens of technologies that have been applied throughout the Federal Government. 

For example, the chart shows that by the application of advanced 

metering, advanced meters pay for themselves in roughly 3 

months, two-tenths of a year. So I was trying to calculate that in 

months. Lighting pays for itself in about 6 years. A building envelope improvement is 9 years. And these are historical records going 

back 10 to 15 years. Today’s technology is better than the technology that we have in our database that was entered in the late 

1990s. So, in fact, the payback periods for these various technologies are actually shorter now and will be shorter going forward 

than they were over the past decade or so. 

Senator CARPER. OK. Thanks. 

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able power generation is also an important component of the Federal Government’s effort and also important if we intend to reduce 

our greenhouse gas emissions. 

Though the Federal Government purchased or produced over 4 

percent of its electricity last year from renewable sources, it is difficult for all agencies to take advantage of on-site renewable energy 

generation. Except for the Department of Defense and the Power 

Marketing Administrations, agencies cannot enter into power purchase agreements longer than 10 years. The Federal Energy Management Program (FEMP) would like all agencies to have authorities of 20 years or more in this regard. 

Senator CARPER. Say that last sentence one more time, just for 

emphasis. 

Mr. KIDD. OK. Except for the Department of Defense and the 

Power Marketing Administrations, agencies cannot enter into 

power purchase agreements of longer than 10 years. FEMP would 

like all agencies to have authorities of 20 years or more in this regard. 

Senator CARPER. Thank you. 

Mr. KIDD. This would afford all agencies the opportunity to build 

solar power plants like the one shown here at Nellis Air Force 

Base, which saves the Air Force about $1 million per year in avoided electricity expenses. 

Efficiency improvements also generate other direct benefits besides cost savings. The General Services Administration reported 

indoor lighting and temperature, which are hallmarks of sustainable green buildings, can elevate worker productivity by 5 to 15 

percent, reduce absenteeism, and improve morale. With more natural lighting, as seen at the Internal Revenue Service campus in 

Kansas City, workers experience less eye fatigue. 

Senator CARPER. Does that mean they can probably catch our 

mistakes better? [Laughter.] 

Mr. KIDD. That is the intent. That would also have the attendant 

benefit of increasing revenue, perhaps. 

Senator CARPER. Well, we have a $300 billion tax gap, so this 

maybe will help. 

Mr. KIDD. The Wayne Morris Courthouse in Oregon is rated as 

a LEED Gold by the U.S. Green Buildings Council, partially due 

to its focus on indoor air quality. And the Environmental Protection 

Agency’s addition to its Research Triangle Park improves indoor air 

quality as well as saves $1.5 million in energy expenses on a $2 

million investment. This is just some of the potential and some of 

the examples that exist within the Federal Government. 

Looking forward, there is every reason to conclude that the Federal Government can be a leader in generating savings while increasing performance through energy efficiency. Executive Order 

13514 outlines the expectation: That by 2030, all new Federal 

buildings must save or produce as much energy as they use. 

Senator CARPER. Explain that. Just stay on that point. When I 

read that in your testimony, I had to look at it a couple of times. 

What does that mean? Just say it again and explain it. 

Mr. KIDD. Well, Executive Order 13514 outlines the expectation 

that by 2030, all new Federal buildings must save or produce as 

much energy as they use. This is roughly what is called a net-zero 


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1The prepared statement of Ms. Robyn appears in the Appendix on page 52. 

building, which is a building that produces as much energy over 

the course of a year as it uses in that same time frame. 

The strategy to obtain such buildings is to start with a whole 

systems integrated design approach, make the building as efficient 

as possible, super-efficient, and then integrate on-site renewables 

to cover what demands exist within the building. And we at DOE 

have a database of net-zero buildings, commercial buildings that 

now exist in America, and near net-zero and very high-performing 

buildings that exist in both the commercial sector and the public 

sector. 

So it is out there. It is proven. We can, right now, get 30 to 60 

percent energy reductions in building retrofits and 40 to 90 percent 

energy reductions in new builds. 

Senator CARPER. Thank you. 

Mr. KIDD. By making greenhouse gas reductions, the integrating 

metric for performance, the Executive Order encourages whole systems thinking, establishes a more energy efficient Federal Government, a government that will save money, protect the environment, 

enhance security, and cut back on greenhouse gas emissions. 

I look forward to your questions. 

Senator CARPER. Good. Thanks for that testimony, very much. 

Thanks for reading some of it twice. 

Senator CARPER. Dr. Robyn, please proceed. 

TESTIMONY OF DOROTHY ROBYN, PH.D.,1 DEPUTY UNDER 

SECRETARY OF DEFENSE FOR INSTALLATIONS AND ENVIRONMENT, U.S. DEPARTMENT OF DEFENSE 

Ms. ROBYN. Thank you very much, Chairman Carper. My testimony today on behalf of the Department of Defense will focus on 

the Department’s energy performance. As the Deputy Under Secretary of Defense for Installations and Environment, I oversee policy and programs related to the energy used on our permanent 

military installations, our bases, both at home and overseas. This 

is the area called facilities energy. I will also in my testimony cover 

so-called operational energy, which is the energy that is used in 

our combat systems and support for combat operations. 

My message today is a fairly straightforward one. The Department of Defense has stepped up the long-term effort needed to reduce our high level of energy consumption, and this effort is driven 

first and foremost by mission considerations. 

First of all, in a combat setting, in an operational setting, our 

military’s heavy reliance on fossil fuels creates significant risks and 

costs that can be measured in reduced mission effectiveness and in 

U.S. soldiers’ lives. The best way to show this, and I am sorry I 

don’t have it electronically, but this is a picture of a convoy going 

through the Khyber Pass in Afghanistan. 

Senator CARPER. How can I be sure? [Laughter.] 

That could have been a picture of my backyard and I would not 

have known. 

Ms. ROBYN. Let us hope not. A large fraction of the tonnage carried by convoys is fuel and water. Convoys are the largest and most 

vulnerable target for insurgent attacks and improvised explosive 


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devices (IEDs). The more convoys we send, the greater the need for 

protection and, in turn, for supplies to support the protective 

forces. Marine Corps General Jim Mattis famously said during the 

course of the Iraq War, ‘‘Unleash us from the tether of fuel.’’ 

In addition to the combat operational concern or problem, there 

is a problem with our fixed installations. They are dependent on a 

commercial power grid that is increasingly vulnerable to disruption 

from overload, natural catastrophe, and cyber attacks. See the 

front page story in yesterday’s New York Times. The Defense 

Science Board has warned that the vulnerability of the grid puts 

critical military operations that are launched from these bases at 

risk. 

In short, unleashing warfighters from the tether of fuel and reducing our installations’ dependence on a costly and potentially 

fragile power grid will not simply enhance the environment, it will 

significantly improve the military’s mission effectiveness. Executive 

Order 13514 is a tool to help us turn these vulnerabilities that I 

described around. One indication that we view it as a very helpful 

tool is that we are developing an aggressive target under the order 

for reducing our greenhouse gas emissions, which are due overwhelmingly to our direct energy use. 

Now, operational energy, energy used in theater, is exempt, necessarily so, from any regulatory target because our immediate goal, 

our immediate priority is to provide support for the warfighter. But 

reducing the energy demands of our operational forces is nevertheless a major focus of our efforts to cut energy consumption. 

Senator CARPER. Good. 

Ms. ROBYN. As I say, we have stepped up the effort. We have a 

long way to go. This is a long change and a cultural change for the 

Department. Let me highlight three areas where we have stepped 

up the effort. 

The first is organizational leadership, commitment from the top. 

The Secretary has expressed his strong support for the goal of reducing energy consumption. The Department has created the Office 

of Director for Operational Energy Plans and Programs in the Office of the Secretary of Defense. The President has nominated 

Sharon Burke to head this new directorate and we hope the Senate 

will confirm her very soon. 

The Military Departments are standing up their energy offices, 

as well, and the Service Secretaries have, without exception, made 

energy one of their highest priorities. For example, in October, 

Navy Secretary Ray Mabus announced a set of ambitious new goals 

to boost the energy efficiency of the Navy and the Marine Corps. 

His plans include fielding a completely sustainable carrier strike 

group, dubbed ‘‘the Great Green Fleet,’’ by 2016 and producing half 

of all the Navy’s installation energy requirements from renewable 

sources by 2020. Those are very ambitious goals. So that is one 

area of leadership. 

Second, we are investing more to make our fixed installations, 

which I oversee, less energy consuming. Our basic strategy is a 

two-part strategy: Reduce the demand for traditional energy while 

increasing the supply of renewables energy sources. 

The press has focused on renewables for understandable reasons. 

Pictures like the one Mr. Kidd showed you of Nellis Air Force Base, 


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it is incredible, 72,000 solar panels that track the sun. I have fabulous slides which I am kicking myself for not having brought of 

things we are doing with wind turbines and wave power and all 

kinds of renewables. Geothermal, the Navy has been doing geothermal at China Lake for more than 20 years. 

But while the press focus has been on what I call the supply 

side, the renewable side, and that is very important, as Mr. Kidd 

said, the real low-hanging fruit is on the demand side. That is 

where we can really get the big gains. That is the most cost-effective thing that we can do. And so our focus has been there, and 

that is in investment in retrofit of existing buildings, and we have 

a lot of them. We account for 300,000 of the 500,000 Federal buildings. And then also investment in new building construction. 

Let me highlight a new initiative that we have just gotten underway in the facility energy area. DOD’s fixed installations, and as 

I said, there are a lot of them, offer an ideal test bed for next-generation energy technologies coming out of industry, labs, out of the 

Department of Energy, and university labs. Our built infrastructure is unique for its size, 300,000 buildings, 2.2 billion square feet 

of space. That is four times as much as Wal-Mart has. And also for 

the variety of facilities that we have—commissaries, data centers, 

office buildings, and barracks. And that variety captures the diversity of building types and climates in the United States more 

broadly. 

As both a real and a virtual test bed, our many facilities can assess the technical validity, cost, and environmental impact of advanced pre-commercial technologies, technologies that are caught 

in that valley of death between the lab and deployment. 

Moreover, in addition to testing those technologies, for those that 

prove effective, we can serve as an early and large customer, helping to create a market, much as the Department did with everything from electronics to aircraft to the Internet. This test bed, 

using our facilities as a test bed, is key to our own needs, but I 

think it is also going to be an essential element of a national strategy to develop and deploy the next generation of energy technologies needed to support our built infrastructure. 

And then finally, let me mention a third area where we have 

stepped up the effort. We are changing the rules to take account 

of the real cost of fuel used in theater, used in war. As I mentioned 

earlier, the weapons systems and the platforms we use have what 

is called a logistics tail, because of the need to deliver fuel under 

difficult circumstances, and to protect the supply lines. That is 

risky and it is expensive. Taking that logistics tail into account, the 

real cost of fuel used in theater, what we call the fully burdened 

cost of fuel, can be as much as an order of magnitude higher than 

the commodity price, at least under certain scenarios. So it can be 

quite expensive. 

Currently, the fully burdened cost of fuel is not captured in either the process whereby we set requirements for new weapons 

systems or actually acquire them, the acquisition process. So we 

are implementing two fundamental changes that together will represent a systemic change in the way we make decisions that affect 

our energy demand in terms of weapons systems. Energy consumption will no longer be an unquestioned assumption. It will be seen 


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1The prepared statement of Mr. Pulcrano appears in the Appendix on page 59. 

as a strategic and tactical vulnerability. This will take a long time 

to play out because of the life cycle of our systems, but it is a really 

critical change that has been a long time coming. 

So in sum, the military’s heavy reliance on fossil fuels is both a 

tactical and a strategic vulnerability, the costs of which are exacted 

in dollars, lives, and reduced mission effectiveness. The Executive 

Order is a tool for helping us turn this vulnerability around. Although our goal of energy security will require a long-term effort 

and much remains to be done, we are committed to making significant changes. We feel we don’t have any choice. These changes will 

not simply enhance the environment, they will significantly improve the effectiveness of the military mission. Thank you. 

Senator CARPER. Great. Thank you very much for that testimony. 

Mr. Pulcrano, welcome. 

TESTIMONY OF SAM PULCRANO,1 VICE PRESIDENT, OFFICE 

OF SUSTAINABILITY, U.S. POSTAL SERVICE 

Mr. PULCRANO. Thank you. Good afternoon, Mr. Chairman. I am 

pleased to represent the Postal Service here today. 

My testimony will center on three main points: How the Postal 

Service has been and will continue to be a sustainability leader; the 

details of our environmental initiatives; and how we can partner 

with the Federal Government. 

In 2008, the Postal Service established a dedicated Office of Sustainability to coordinate energy, fuel, recycling, and sustainability 

programs within our 33,000 facilities, nearly 217,000 vehicles, and 

with our approximately 600,000 employees. We approached sustainability as an initiative that was fundamental to our business 

plan. Adopting sustainable practices is not only good for the environment, it also helps us reduce our operational cost. 

Last October, President Obama signed Executive Order 13514, 

Federal Leadership in Environmental, Energy, and Economic Performance. Although this Executive Order does not apply to the 

Postal Service, we were extremely honored when the White House 

press release accompanying the Executive Order recognized our 

work. 

Our leadership activities have included releasing the first Federal Government greenhouse gas emissions inventory, and our first 

ever sustainability report, which highlights our progress and looks 

at our future challenges. 

Some of our environmental achievements include reducing our 

energy intensity since 2003 by nearly $250 million each year; saving $42 million in fuel costs in quarter one of this year; implementing green teams that saved over $4 million last year; saving 

$3 million in a short agency-wide energy challenge that we initiated last year; avoiding approximately $1 million in costs last year 

via green IT initiatives; and we recycled over 200,000 tons of waste 

last year. 

Moving forward, we have set targets to build upon these successes. Three of these targets coincide with the Federal agencies’ 

targets. They are to reduce energy use and intensity in our facilities by 30 percent, reduce petroleum use by 20 percent, and inVerDate Nov 24 2008 11:12 Jan 05, 2011 Jkt 056839 PO 00000 Frm 00016 Fmt 6633 Sfmt 6633 P:\DOCS\56839.TXT SAFFAIRS PsN: PAT

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crease our use of alternative fuel by 10 percent. By 2020, we have 

also incorporated our own goal to reduce greenhouse gas emissions 

by 20 percent. 

Our roughly 33,000 facilities vary greatly and provide unique 

challenges and large-scale opportunities for energy management efforts. We have conducted facility audits, modernized facility infrastructure and control systems, and improved processes and systems 

to allow for more effective and efficient management of our energy 

consumption. To help ensure ongoing success, we evaluate each energy impacting project and have implemented energy information 

systems. 

Another one of our priorities is managing fuel consumption. Our 

217,000 vehicle fleet is, on average, approximately 18 years old, 

and travels more than 1.2 billion miles a year, and we are consistently looking for ways to reduce it environmental impact. Vehicles 

are critical to our mission and we are thinking hard about what 

steps will best take us into the future and focusing on customer 

service and energy efficiency as our guiding goals. 

The Postal Service has always led the way in testing alterative 

fuel vehicles, which can use a variety of clean fuels. Currently, we 

have about 44,000 alternative fuel vehicles in our fleet and we are 

now gathering data on how best to improve our long life vehicles. 

Those are the delivery vehicles that you see each and every day in 

your neighborhood. We are investing $250,000 to assist five electric 

vehicle technology companies in researching and developing an 

electric vehicle conversion solution for those neighborhood vehicles. 

These projects will provide invaluable information on what might 

work best to transition our aging long life vehicle fleet. By working 

together with industry, our goal is to find a solution that is environmentally friendly, compatible with our business needs, and cost 

effective. 

We have also worked with consumers on environmental initiatives. On our Website, we created a special green section. At 

usps.com/green, customers can find helpful facts and suggestions, 

along with tools to improve their environmental awareness, measure their carbon emissions, and create conservation plans. 

We also have a Post Office Lobby Mail Recycling Program that 

we plan to expand to 8,000 offices in 2010. The program places secure recycle bins in post offices for customers to use when they are 

finished reading their mail. The simple but very effective message 

of the program is ‘‘Read, Respond, and Please Recycle.’’ 

We look forward to working with the Congress on any legislation 

that will help the Postal Service to continue to fulfill its mission 

for the American public, ensure financial responsibility, and promote sustainable business practices. 

To close, I feel confident in saying that the Postal Service is 

ready to take the next steps in our green leadership role. Because 

of our size, the Postal Service could serve as a catalyst for leading 

the rest of the Nation toward a greener future. 

I appreciate your consideration. Thank you for inviting me to 

speak and discuss these important matters. I would be pleased to 

respond to any questions that you may have. 

Senator CARPER. Good. Mr. Pulcrano, thank you very much for 

wonderful and encouraging testimony. 


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I like to say that sometimes people would rather see a sermon 

than hear one, and I think in a number of respects, the Postal 

Service has shown us a sermon, really by your behavior, and I just 

applaud you for that. That is one of the reasons why you are here 

and why we wanted you to be here. 

Yesterday, I got to do something that was a lot of fun. I have a 

neat job that the people of Delaware have given me. It has some 

downsides from time to time, but a lot of upsides, as well. Yesterday, I got to drive the Chevrolet Volt. I call it the most advertised 

car in the world that has never been built. [Laughter.] 

It is something that the car makers developed and I have been 

following since I was in Detroit at the Detroit Auto Show several 

years ago when it was first unveiled by General Motors. What a 

fun car to drive. Did anybody here in the audience ever drive an 

electric car? If you have, raise your hand. They are not only clean 

and quiet, but they are also just a lot of fun. 

The fellow who was riding shotgun with me was the guy who 

was the development team leader for the Volt for the last several 

years and we had a good time driving. We drove on a slalom course 

that was on a huge parking lot where they used to have the D.C. 

Convention Center. I just drove as fast as I could and scared him 

to death. [Laughter.] 

Mr. PULCRANO. That is the nice thing about those vehicles. 

Senator CARPER. He said, I am about to lose a car that is probably worth a million dollars because of this guy’s driving. [Laughter.] 

But when we finished the drives around and around, he said to 

me, this vehicle has the ability, if it is at home or wherever it is 

being charged at night, he said, they lose electricity and the home 

has actually the ability to move the electricity the other way and 

to use the battery of the vehicle to provide electricity for the home. 

About a year earlier, I had driven another electric car back in Delaware that had been developed using a different platform. 

But the idea was to take some next steps on vehicle-to-grid, 

where again we use a whole fleet of batteries in vehicles for storage, maybe for electricity you can create by offshore wind or onshore wind, or by solar or other renewables where the sun doesn’t 

always shine and the wind doesn’t always blow. So when it does, 

store the electricity, and when you need it, you just pull it out of 

the batteries of vehicles. 

I think this is something the Postal Service might be looking at. 

I don’t know how familiar you are with the prospects for doing 

that, but I think it is something that you all might be looking at. 

I am always thinking about ways to save or make money. As the 

Postal Service faces these enormous deficits, you all have done a 

very nice job managing down the size of your workforce and finding 

a lot of efficiencies, looking for other ways to make money. But if 

you have any thoughts about what kind of potential there might 

be for the Postal Service with all their vehicles—how many vehicles 

do you say they have? 

Mr. PULCRANO. We have 217,000. About 170,000 deliver mail 

each and every day. 

Senator CARPER. Given your business model and all those vehicles you have, is there any potential for not just saving money, but 


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actually making some money through a vehicle-to-grid approach 

using your 200-and-some-thousand vehicles for that purpose? 

Mr. PULCRANO. We have explored that, Senator. In fact, we have 

met with the University of Delaware, which has developed a vehicle-to-grid technology. It is relatively expensive at this current time 

as there is no economy of scale in production. 

Mr. Kidd and I, and our teams have met several times. We have 

met with some of the electric providers and we have had conversations about being willing to test that technology and look at what 

opportunities it may present to the Postal Service. 

Senator CARPER. Good. Well, I will be interested to see what you 

turn up. Thank you. 

Let me go back to Ms. Sutley, if I could. How long have you been 

in your job so far? 

Ms. SUTLEY. It has been just a year. 

Senator CARPER. What is it like? 

Ms. SUTLEY. It has been a very exciting year. 

Senator CARPER. It sure has been, hasn’t it? 

Ms. SUTLEY. It certainly has. 

Senator CARPER. You get to work on a lot of interesting stuff. 

Ms. SUTLEY. Absolutely. 

Senator CARPER. Former Governor Peterson, who I mentioned 

earlier, the former governor of Delaware, from 1968 to 1972, has 

been one of my mentors, but he said one of the best jobs he ever 

had was the job that you now hold. 

The Executive Order that we are here talking about lays out 

some measures of success in saving energy and achieving other 

goals. For example, the agencies will report on greenhouse gas 

emission reductions and the reductions of petroleum-based fuels for 

the Federal fleet, which I think you have already said. Although 

the Executive Order does not require a report of cost issues, I believe knowing the financial ramifications could be very helpful. For 

example, knowing Federal agencies saved millions or tens of millions of dollars over the previous year due to increased energy efficiency investment would, I think, underscore the importance of 

Federal leadership. 

I just want to ask you, could the White House include cost savings estimates as part of its regular reporting? Have you given that 

any thought? Is that something that you all have discussed? Are 

you open to doing that? Your thoughts? 

Ms. SUTLEY. Well, thank you, Senator. I am always happy to 

hear about my distinguished predecessors at CEQ, and as you may 

know, we are celebrating our 40th anniversary this year, so it is 

a great institution. 

The Executive Order really tries to drive performance, and in a 

couple of ways. First of all, the oversight of the Executive Order 

is with the Office of Management and Budget and with the Council 

on Environmental Quality. So we want to make sure that we are 

achieving the twin goals of environmental improvement as well as 

cost savings for the taxpayers. The sustainability plans that the 

agencies will submit in June, the greenhouse gas emission reduction goals that they have already submitted are really based on trying to prioritize those actions that will save the most money. And 

then we have the opportunity through the OMB process and 


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through the scorecards to report on performance. So certainly open 

to looking at ways that we can show the taxpayers what they are 

getting for these investments. 

Senator CARPER. What I am going to do is just follow up in writing with a request that you further explore that. I see value in reporting cost savings, along with some of the other measures of success that you have cited in energy efficiency. So I am going to follow up, and if that is something that you all think might have 

value, I would be delighted if you would run with that ball. 

Mr. Kidd, you have given us a chart that you were good enough 

to put up on the screen that shows the time for energy savings to 

actually break even and then start making money. Some, such as 

new photovoltaic panels, could take years to pay off. Others, like 

metering, which you pointed out, smart metering, much quicker, 

sometimes in a matter of months—2 months, in fact, from your 

graph, if I am not mistaken. Does this show that the Federal Government needs to take more of a long-term view of the economics 

of energy savings? In other words, the Federal Government should 

think not just about the cost maybe this year or this month, but 

over the next 5 years or even 10 years? If you could take that one 

for starters, I would appreciate it. 

Mr. KIDD. Well, sir, that is actually a very easy one. The answer 

is yes. 

Senator CARPER. Thank you very much. [Laughter.] 

Mr. KIDD. Sir, as I said in my spoken remarks and in my prepared testimony, we need to think of our expenditures as investments, investments in energy efficiency, and investments in renewable power. We need to recognize that the payback period for some 

of these investments is longer than the one-year budget cycle or an 

election cycle. We need to think about the cumulative benefits, not 

just the cost-benefits, but the other attendant social benefits, as 

well, whether it is increased work or productivity, a better experience for the great American public when they come in to a Federal 

building, or, as Dr. Robyn pointed out, benefits such as the security 

and welfare of our soldiers. So we certainly need to take the long 

view. 

One of the things that we in FEMP are doing in support of all 

our Federal customers is that we are trying to provide decision 

support tools and planning models based on marginal abatement 

cost curves, based on best practice in the private sector, trying to 

guide the other agencies’ investment decisions so that they will get 

the highest amount of benefits possible from their expenditures. 

Senator CARPER. Thank you. I am going to ask you another question, if I could. Your metering example. I found just especially intriguing. It kind of jumped off the chart at me, in fact. And I note 

that your chart showed savings could be realized in just a couple 

of months. I understand with advanced metering technology a facility manager can known in real time when there is a spike in energy use. 

I don’t know who said this, but somebody once said, what gets 

measured gets managed. That is a phrase that most of us have 

probably heard. I also understand that in companies like WalMart—I visited one of their big facilities in Delaware recently—adVerDate Nov 24 2008 11:12 Jan 05, 2011 Jkt 056839 PO 00000 Frm 00020 Fmt 6633 Sfmt 6633 P:\DOCS\56839.TXT SAFFAIRS PsN: PAT

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vanced metering is employed, they think it saves money and that 

is why they are interested, in part, in doing it. 

Am I missing something? Do you think Federal agencies should 

adopt advanced metering as a technology with a relatively quick 

payback period? Maybe you are already doing it and I am not even 

aware of it, but—— 

Mr. KIDD. The Federal agencies have a number of statutory requirements on metering and building audits and assessments 

which are closely related to metering. By the data that we have, 

the Federal agencies are actually ahead of where they need to be. 

This is EISA Section 432. Advanced metering certainly has the potential, where applicable and appropriate, to generate these high 

returns. So you might not want to meter every single building or 

every single piece of equipment in the building. But when you look 

at the realm of the possible and you have the idea of having an 

electronic device on every facility and all the major energy-using 

equipment in that facility—your heating, ventilation, and cooling 

(HVAC), your boilers, your chillers, your air handling equipment— 

and the use is reported nearly instantaneously, you can then get 

to the point where you can control and direct your building to operate efficiently. 

One of the greatest areas for energy efficiency is to just use the 

energy efficiency investments that have already been installed on 

the premises. There have been a number of cases reported where 

Federal agencies or others have an efficiency measure or an energy 

conservation measure that is not being used. 

Senator CARPER. I think that is a good point, but can you just 

give us a couple of examples where that has proven true? 

Mr. KIDD. I will go ahead and point a finger at our own agency, 

the Department of Energy. There was recently an IG audit that indicated we had setback controls which were not being used. A setback control is like a building thermostat. It turns the temperature 

down when people go home and turns the temperature up when 

folks come to work in the morning. An advanced metering system 

that was measuring building performance would have immediately 

identified that and flagged it for correction. 

Our ideal state is to get to a place where Federal buildings are 

continuously commissioned. Commissioning right now is a process 

where outside experts come into your building and make sure everything is working. It is like taking your car on a service schedule 

to the dealer once or twice a year and they make sure your car is 

working. Continuous commissioning is where we would harness the 

powers of meters and associated IT technology to make sure your 

building is commissioned continuously and it is updated and operating at peak performance all the time. 

Senator CARPER. All right. Thank you. 

I want to ask the next question of Dr. Robyn and Mr. Kidd. You 

both mentioned two interesting public-private partnership tools. 

Incentivizing private businesses to partner with the Federal Government is a useful approach, I think especially when the investment dollars come from the private sector. I understand that the 

power purchase agreements allow the private sector to economically make use of military land to build solar-powered generators. 


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And so, for example, if the Dover Air Force Base, a major installation in our State, would—and, I might say, the current holder of 

the Commander in Chief Outstanding Air Force Base in the 

World—want an alternative energy project, the City of Dover, 

which is the local utility, by the way, could agree to pay for and 

construct a solar power facility using the Dover Air Force Base’s 

land or their building space. In return, the Air Force Base would 

receive electricity at a reduced rate. 

And energy service performance contracts are, I am told, another 

creative way to pay for energy efficiency projects, such as more efficient heating and control units for buildings. But both can often 

mean that there is no need for the initial Federal investment, but 

see savings for Federal agencies. 

So with that as a backdrop, could you all just take a minute or 

two and talk about the power purchase agreements employed by 

the Department of Defense as well as the energy service performance contracts? Dr. Robyn. 

Ms. ROBYN. Sure. We are using power purchase agreements, enhanced use leases, other mechanisms like that at a number of the 

renewable projects. 

For example, at Fort Irwin in Southern California, huge Army 

National Training Center, the Army Corps of Engineers is 

partnering with two developers, not the local utility but two energy 

developers, to build a 500-megawatt solar facility. I mean, that is 

phenomenally big. 

Senator CARPER. That is huge. 

Ms. ROBYN. Yes. It is immense. I think Fort Irwin’s peak power 

need is something like 35 megawatts, so it is several orders of magnitude—— 

Senator CARPER. How big is this facility, the base? 

Ms. ROBYN. Well, Fort Irwin is immense—— 

Senator CARPER. Bigger than Delaware? We are immense. 

[Laughter.] 

Ms. ROBYN. We have 31 million acres of ranges and installations, 

and I used to know what that was equivalent to in terms of a 

State, but I can not remember. 

Senator CARPER. Several Delawares. 

Ms. ROBYN. I am sure it is not as big as Delaware. [Laughter.] 

So, yes, enhanced use leases, power purchase agreements are absolutely critical to these sort of deals. The Fort Irwin project will 

be somewhere on the order of $1.5 billion, and as you say, the private sector will finance that. What Fort Irwin will get is a reduced 

rate on electricity. There may be some sort of a preferential treatment in the case of an emergency for critical operations. 

Senator CARPER. Before you move on—— 

Ms. ROBYN. Yes? 

Senator CARPER [continuing.] Again, how much money in the investment? How many dollars goes into that investment? 

Ms. ROBYN. How much are we putting into—I don’t know. Mr. 

Kidd, do you know? 

Mr. KIDD. It is not in the footnote here. 

Ms. ROBYN. I think I have some numbers on Energy Savings 

Contractors (ESCOs). Well, this is a combined number for—— 

Senator CARPER. What was the total investment? 


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Ms. ROBYN. For Fort Irwin—or just that one project? 

Senator CARPER. That one project. 

Ms. ROBYN. It is around $1.5 billion. There have been different 

numbers reported in the press. 

Senator CARPER. And some of that is from private—— 

Ms. ROBYN. That will all be private money. 

Senator CARPER. OK. So in terms of taxpayer dollars that are involved in that project, how much would that be? 

Ms. ROBYN. I don’t think there will be any—— 

Senator CARPER. Zero? 

Ms. ROBYN. Yes. 

Senator CARPER. Is that correct? 

Ms. ROBYN. Right. 

Senator CARPER. OK. So $1.5 billion in private dollars, maybe 

nothing from the Federal Government. And in return for that, the 

Federal Government gets less expensive electricity. 

Ms. ROBYN. Right. 

Senator CARPER. And do we know how much less? Ten percent? 

Twenty, 30, 40 percent? 

Ms. ROBYN. I think in the case of Nellis Air Force Base with a 

14-megawatt facility which provides roughly a quarter of their 

needs is saving $1 million per year. 

Senator CARPER. All right. 

Ms. ROBYN. A million a year. Can I say a word about Energy 

Savings Performance Contracts (ESPCs)? And Mr. Kidd really is 

the expert on ESPCs, and they are a wonderful mechanism because, again, it allows the Federal Government to make improvements that it would not otherwise be able to by having Honeywell 

or some other ESCO be paid out of the savings, the savings that 

the Federal Government would otherwise get in its energy bill as 

a result of the new technology. 

But let me just mention one issue with ESPCs and it ties back 

to my notion of a test bed. When a military installation or when 

a Federal agency works with an ESCO, and ESCOs are the ones 

who carry out ESPCs, the ESCO is trying to minimize its risks—— 

Senator CARPER. I am not real good on acronyms. Go ahead and 

say what that stands for. 

Ms. ROBYN. ESCO is Energy Savings Contractor. I think of Honeywell because I met with Honeywell, but there are many companies that are ESCOs. Honeywell is one of the largest. Johnson Controls is another one. There are a lot of very small ones that specialize in—for example—putting daylighting into Federal buildings, 

and they are terrific. But their goal is to minimize their risk. That 

is how they make money. And so they want to use technology that 

does not entail risk. 

We, the Federal Government, should be willing to take on some 

risk and that is what we would be doing and the test bed concept 

envisions that. We have facilities. We are willing to take some risk. 

Come try your novel technology out on us. We can afford to be patient and to take some risk. When you use an ESCO, there is an 

opportunity cost to doing that because you are putting in some existing technology as opposed to trying out something more novel 

that might be the next generation of technology. So that is a cautionary note on the ESPC concept. 


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Senator CARPER. All right. Thank you. 

Mr. Kidd, any point you want to make on this before we move 

to the next one? 

Mr. KIDD. I never pass up an opportunity to talk about all financing and public-private partnerships. 

Senator CARPER. OK. 

Mr. KIDD. I think all the Federal agencies appreciate the authorities that Congress has given them to enter into private-public partnerships in the area of energy savings and renewable energy production. Congress has given the Federal Government four tools: 

UESCs, Utility Energy Savings Contracts; ESPCs, Energy Savings 

Performance Contracts; PPAs, power purchase agreements; and enhanced use leases (EU’s). These are the major mechanisms for investment in energy efficiency and renewables in the Federal Government. 

We don’t have all the data for 2009, but it looks like last year, 

2009, was the best year ever in terms of Federal investment in energy efficiency projects. Nearly an 80-some-percent increase over 

the previous year. And of that investment amount, roughly twothirds came from appropriations and one-third came from these 

various mechanisms. Without these mechanisms, the Federal investment basically would have been one-third less, and that adds 

up and makes a difference. 

I alluded to it earlier in my testimony: I would like to see the 

authorities on these mechanisms expanded so that all agencies are 

on an equal footing. Even agencies that have land, like Nellis Air 

Force Base, and where it makes financial sense to enter into a 

power purchase agreement, if the agreement is for more than 10 

years, they can’t enter into it right now. 

Senator CARPER. Well, what should we do about that? 

Mr. KIDD. We have discussed it with your staff. It is just a matter of taking the authorities that are available to the Department 

of Defense and extending them to all the Federal agencies. 

Senator CARPER. OK. Thank you. 

Mr. KIDD. On ESPCs, Energy Savings Performance Contracts, I 

would like to align myself with the comments of Dr. Robyn. These 

are a great tool when appropriately managed and used where it 

makes sense to do so. They do have some limitations. They are not 

perhaps as aggressive as we in the Federal Government would like. 

And there is also an attendant cost of capital expense. 

So last year, it looks like the Federal Government made about 

$440 million of investment. None of that money came from appropriated funds. But the ESCO, the company that did the work, borrowed the money, and it makes the total project cost about 2.4 

times higher. 

One of the things that I would like to see us do and work collectively is to reduce the cost of capital to the Federal agencies. When 

the project basically has the good faith and trust of the Federal 

Government as the basis of risk, we should be paying full market 

rates for the cost of capital as if you were a company borrowing the 

money on Wall Street. Thank you. 

Senator CARPER. And you already discussed that with our Subcommittee staff? 


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Mr. KIDD. They are all nodding their heads, so I think that is 

yes. 

Senator CARPER. That is a good sign. Thank you. 

Dr. Robyn, let me come back to you. You represent quite a 

unique agency. The Department of Defense is tasked with the mission of keeping our Nation safe. If the Department of Defense can’t 

perform this task, there probably wouldn’t be any Postal Service or 

Department of Energy or budget process. There might not even be 

a legislative body like the Congress. 

The point is that the Department of Defense’s ability to achieve 

its mission is in many ways the most important mission of any 

agency in our Federal Government. Many would argue that nothing should get in the way of this mission or make it harder for the 

Department to achieve it. And I am sure you have encountered 

many of these advocates from time to time in the Pentagon. 

This means that you and some of your colleagues in charge of the 

Department of Defense’s energy policies and energy use have not 

an easy assignment. How are you going to incorporate, or how are 

you endeavoring to incorporate energy efficiency into an agency 

that historically has had an unhindered mandate to use whatever 

resource it needs to protect this country? Has energy efficiency and 

the Department of Defense’s mission ever been at odds? My guess 

is they probably have. You actually alluded to this a little bit in 

your testimony. But how do you make energy efficiency harmonize 

with the Department of Defense’s mission? 

Ms. ROBYN. A couple of months ago, Nancy Sutley and I were 

meeting with a senior Defense official—I won’t say who it was, but 

somebody quite senior who at one time worked on the staff in the 

Senate, and he said to both of us, the change here with respect to 

energy is reminiscent to him of what happened with child care 

many years ago, in the late 1980s. He said, Congress told the Department, you have to provide child care for service members, and 

the Department was resistant to it, but within a year they had 

pivoted and embraced it and the services have among the best child 

care programs that there are in the Federal Government. 

And, he said, the same thing has happened with energy efficiency, that we get it because of the tremendous operational restrictions that this tether of fuel has placed on us. It has become 

very graphic in Iraq and Afghanistan, how difficult it is to operate 

when you have to have these long convoys. And so I think there 

is a way—a sense in which people get it in a way that they have 

not before. 

Now, it is true that operational energy is exempt from the target. 

It has to be. We can’t be on the hook to meet a target because we 

don’t know how many wars we will be in, if any. And it will take 

a long time, at least with respect to weapons systems. But I think 

the Department has been a leader in technology forever and I think 

that will be the case here. We won’t be the leader when it comes 

to a lot of the energy technology. That will be the Department of 

Energy (DOE). But we will be a test bed. 

And I don’t sense resistance to it. What I sense is impediments 

of the kind that Mr. Kidd has talked about. It is just the Federal 

Government budget is structured in such a way that we don’t have 

a capital budget, and so when an investment makes sense over 


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time, we have to figure out a way to pay for that up front that 

doesn’t get scored by OMB, and these mechanisms that we have 

been talking about are ways to do that. 

Senator CARPER. Mr. Pulcrano, the Executive Order that we are 

talking about—what is the number—— 

Mr. PULCRANO. Thirteen-five-one-four. 

Senator CARPER. Executive Order 13514 calls on agencies to better monitor the energy they are using, and in your testimony, you 

mention how the Postal Service tracks its energy use through a 

single system. I believe you call it the corporate energy interface. 

Is that what it is called? You probably have an acronym for it. 

Mr. PULCRANO. That is one of our measurements. It is the energy 

management system. 

Senator CARPER. All right. Just take a minute and explain to us 

how this system works, if you would, please, and what kinds of rewards that the monitoring at that level can bring to an agency. 

And I would invite the other witnesses to also comment on the benefits, if you see them, in such a system and perhaps why all agencies haven’t considered following the Postal Service’s lead. Maybe 

they are. 

Mr. PULCRANO. Let me talk about this in a couple stages. First, 

at the Postal Service, we have an inventory of 33,000 facilities that 

we directly manage. Of those 33,000, we have selected 2,000 that 

are the largest facilities, and they account for about 75 percent of 

our overall electrical energy use. 

Senator CARPER. So how many facilities do you have, 33,000? 

Mr. PULCRANO. Thirty-three-thousand. 

Senator CARPER. You picked 2,000 and they represent 70 percent 

of the—— 

Mr. PULCRANO. These 2,000 facilities represent 75 percent of our 

total energy use. So we have narrowed it down and we are focusing 

on those particular facilities. We started this program in 2007 and 

currently we are aggressively conducting energy audits at each and 

every one of those facilities. We have completed 500 of them to 

date. We started with the largest. To give you a sense of the scale, 

most of those facilities are approximately a million square feet— 

our facility in downtown Manhattan, Morgan Station, which has a 

green roof, I might add—is 2.2 million square feet. So we have targeted and completed the largest facilities. 

Based on those audits, we examine possible capital improvements and put them in rank order. We look for a maximum return 

on investment because currently we are in difficult economic circumstance. We really have to be very careful how we invest our 

money. So we look for the best return. 

We also have an energy management system. To date we have 

6,800 of our facilities in that system, and the system monitors all 

our use. It provides our fuel use, our natural gas use, our energy 

use, etc. We are able to track it on a month-to-month basis and we 

measure performance against the goals we have set corporately. 

We have tied those goals to our individual managers’ performance, 

this year, and next year, it will be compensable. This year, we are 

baselining it. 

We have the National Performance Assessment (NPA) system. It 

is the methodology by which our management team across the 


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country is recognized. The NPA assesses progress toward a number 

of corporate goals—safety goals, service goals, etc. This year, one 

of the new goals is baselining an energy index. It counts for both 

fuel reduction and electricity reduction, and we have weighted 

them appropriately. This is how we have tied it to our managers’ 

individual performance. This year, we are baselining. Next year, it 

will become part of their compensable bonus program. 

The other thing that we are doing is in those 500 largest facilities, much as Mr. Kidd has discussed, our facilities group is going 

to meter those facilities and we are going to bring it into a central 

command system so that we can monitor those largest facilities’ energy use in real time. So if we see a spike in energy use compared 

to yesterday or compared to last year, same time, we would be able 

to pick up the phone and call that plant manager and say, something is not right. I mean, it is really to that extent that you can 

do this. So that is how we are targeting it. 

Senator CARPER. Good stuff. 

Do any other witnesses want to comment on some of the things 

that Mr. Pulcrano just mentioned? Go ahead, please, Mr. Kidd. 

Mr. KIDD. Thank you very much. I note a common theme in some 

of your questions and some of the answers, and that is the emphasis on behavioral and cultural change. In my remarks, I mentioned 

the requirement for an integrated whole systems approach. There 

is no single technology. And one of the most critical components of 

any suite of technologies or any efforts is leadership and an emphasis on cultural change. Your smartest meter doesn’t matter if no 

one pays attention to what it is telling them. 

So I think all across the Federal Government, the agencies are 

starting cultural changes now, and Dr. Robyn mentioned the increased emphasis that this is being given, both structurally and organizationally in the Department of Defense. I work with all the 

Federal agencies, and I would say that trend is occurring across 

the Federal Government. The Federal agencies are embracing the 

need for cultural change, and this is highlighted and reinforced by 

the Executive Order. 

Senator CARPER. Well, I would say this is the change we need. 

Let me come back to you, if I could, Ms. Sutley. It seems to me 

from our testimony today that adding energy efficiency to our Federal buildings could save a whole lot of money. In fact, it is already 

starting to in a variety of places. However, I could imagine that 

those watching the budget for Federal buildings could see the Executive Order as maybe an additional burden, higher costs during 

our times of economic challenge and huge Federal budget deficits. 

Doesn’t the Executive Order require a very cost-effective and 

common sense planning process which is the requirement to consider energy efficiency and other sustainability measures during 

the planning for new building construction? Isn’t that part of it? 

Ms. SUTLEY. Thank you, Senator. The whole thrust and theme of 

the Executive Order is to really make it an integrated system to 

build sustainability into everything that agencies do and that the 

sustainability plans focus on the highest priority for those investments that pay back the quickest and that save the most money. 

So there is real opportunity here, and as you have heard from my 


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colleagues at the table, these are real world examples of how agencies large and small have been able to implement those things. 

The other thing I would say is that—not only for buildings that 

are managed by the General Services Administration and the Department of Defense, or they are using Recovery Act money when 

they do building refurbishments and some deferred maintenance 

and things like that, looking to improve the energy performance of 

those buildings, and that is already paid for. 

So we believe that there is real opportunity to make the investment now to save the taxpayers money, to create clean energy jobs, 

and to make the Federal Government more sustainable overall. 

Senator CARPER. OK. As I mentioned earlier, the amount of buying power that the Federal Government possesses is remarkable. 

Unfortunately, a lot of buying power, we are borrowing from 

around the world and we are buying way too much, as you know. 

But we buy over a half-trillion dollars’ worth of products every 

year. In fact, our 500,000 Federal buildings represent about, I am 

told, about 5 percent of the total commercial real estate in our Nation. 

How does the Executive Order work to leverage this enormous 

buying power to help grow the emerging green sector of our economy? How can we work with the private sector to help provide a 

healthy or healthier marketplace for innovation? And sort of a follow-up to that, how can we use energy efficient technologies in our 

Federal buildings to spur the wider adoption of these technologies 

in the rest of our Nation’s buildings? 

Ms. SUTLEY. Just to say, I think, with respect to the procurement 

power of the Federal Government, and we can go back to World 

War II to when the Federal Government essentially institutionalized recycling, when they asked people to save their nylons and tin 

cans and things like that, and up to more recent times, the Federal 

Government really being one of the first parts of our economy to 

think about spurring on investment in innovation and green buildings. So the Federal Government has not only a history of doing 

this and across many sectors, not just the green sector, but for 

many entities who sell goods and services to the Federal Government, the Federal Government is often their largest customer. 

So the innovation and entrepreneurship that will emerge from 

making it—for requiring agencies to think about green procurement, is to find ways to remove some of the barriers to green procurement, we think will drive innovation and entrepreneurship in 

the green sector. This enormous buying power that the Federal 

Government will provide real opportunity for businesses, small and 

large, to innovate and to provide green services and goods to the 

Federal Government. 

Senator CARPER. Good. Does anyone else want to take a shot at 

that? 

Mr. PULCRANO. We are exploring other alternatives. Currently 

we have about 10 facilities that have significant solar arrays and 

we are looking at how we might increase our use of solar energy. 

Our supplies management group is examining how we can focus 

our purchase systems and recommend which products they should 

buy that are the most environmentally friendly. What products are 

‘‘green products,’’ etc. Those are the products that we as an organiVerDate Nov 24 2008 11:12 Jan 05, 2011 Jkt 056839 PO 00000 Frm 00028 Fmt 6633 Sfmt 6633 P:\DOCS\56839.TXT SAFFAIRS PsN: PAT

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zation prefer that our folks buy. Additionally, we increased our alternative fuel use 26 percent last year. 

We are looking at where we can use our buying power, to drive 

in that direction. To be, not only a sustainable enterprise ourselves, 

but also to partner with suppliers who have the same principles, 

green leadership, and guidance factors that we are embracing. 

Senator CARPER. Dr. Robyn, anything you want to add to this 

question? 

Ms. ROBYN. Not to sound like a broken record—— 

Senator CARPER. Go ahead. Actually, I think repetition is good. 

[Laughter.] 

Ms. ROBYN. Let me make two points. The first is that when you 

talk about $500 billion in buying power, it sounds incredible, and 

it is. There are a lot of impediments that you have to work your 

way through. I think we buy Energy Star electronic products, but 

we disable the features in many cases for security reasons, and security turns out to be an issue when running them. When you try 

to install advanced meters, you run into problems with the Chief 

Information Officer on a base because it fouls up some other 

things. So, I mean, it is not easy. If I could understand why we 

don’t have advanced meters or advanced energy management information systems at all of our installations, I would understand everything. I mean, it is not easy. So it is a complicated problem. 

But the good news is—and this goes back, again, to the test bed 

concept—where I think the Defense Department can really make a 

contribution is using its procurement power as an early technology 

adopter, but also an early customer of technology that can help create markets, and that is happening with renewable technology, but 

it can also happen with energy efficiency technology. 

So when we think about the procurement power of the Federal 

Government, we need to think about that procurement at a very 

early stage when technology is coming out of the labs and it isn’t 

yet commercial and the Federal Government has the ability to fill 

that gap. 

Senator CARPER. OK. Thank you. Mr. Kidd. 

Mr. KIDD. Well, I agree with everything that the other panelists 

have said. I would just digress a little bit and talk to your last 

point about how we can spur wider adoption. I think this is where 

the Federal Government can play a unique role in exhibiting to the 

American people the realm of the possible. 

We get wider adoption when the average American goes to their 

hardware store and chooses to buy the LED light as opposed to the 

incandescent light, and there are some unique opportunities in the 

Federal Government. First of all, the Postal Service has 30,000- 

plus facilities that are basically in every community in America; 

and every American at one time or the other goes to the Post Office. Why can’t they go to a net-zero Post Office every time they go 

and see what is possible and come back to their home and make 

the same sort of purchasing decisions in their home? 

An even sweeter spot is in the Department of the Interior. We 

have 500,000 Federal buildings. We have 756 visitor centers in the 

Department of Interior that get over 500 million visitors a year, 

and these visitors go to these interpretive centers to learn. Why 

can’t they learn what the realm of the possible is for net-zero enVerDate Nov 24 2008 11:12 Jan 05, 2011 Jkt 056839 PO 00000 Frm 00029 Fmt 6633 Sfmt 6633 P:\DOCS\56839.TXT SAFFAIRS PsN: PAT

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ergy and take that back to their schools and their churches and 

their households and say, we saw the Federal Government do it. 

We can do the same. 

Senator CARPER. Great points. 

I am going to a question that sometimes I ask panelists when we 

have a little bit of time at the end. I have a couple of comments 

that I am going to make when we conclude, but I just want to extend to each of you the opportunity to maybe add a point or two 

that maybe you didn’t have a chance that you might think might 

be helpful in this endeavor, or maybe to reemphasize something 

that you have already said. 

Mr. Pulcrano, anything else that you want to reemphasize or just 

a point that when somebody else was testifying, you said, well, that 

reminds me of something I would like to say? 

Mr. PULCRANO. I think you provided the opportunity, Senator. 

You are very familiar with our financial situation. 

Senator CARPER. And I commend you very much, as I did the 

Postmaster General yesterday, for working as diligently as you are 

on so many fronts to rein in costs, control your expenses, and also 

to look for other ways to develop new sources of revenue, and I just 

urge you to continue both. 

Mr. PULCRANO. Well, we thank you. On behalf of the Postal employees, I want to thank you, Senator. 

What we at the Postal Service need is the flexibility, really, to 

determine what our network will be in the future. We have a tremendous opportunity and it is a subject that draws various responses. We need to look at things like changing our network to 

go to 5-day delivery. If we were to go to 5-day delivery, for example, 

that would be a 15 percent reduction, about 24 million gallons a 

year, in our fuel use, and the environmental impact that would 

bring with it. We would still be able to provide the service, the universal service at affordable rates to the American public, which is 

our mission. We need to have flexibility to make those types of network decisions. 

Senator CARPER. All right. Thank you. 

Mr. PULCRANO. Thank you. 

Senator CARPER. Before we turn to Dr. Robyn, I would say on 5- 

day service, some of my colleagues, as you know, are not enthusiastic about it, in fact, quite the opposite. But there are some who 

are supportive of giving you that kind of flexibility. We probably 

can learn from what other countries have done in that regard. 

When I was governor of Delaware, I served on the Amtrak 

Board, and we tried, as Amtrak does today, to figure out how to 

rein in their growth, their costs. One of the things we sought to do 

was to reduce frequencies on certain train routes outside of the 

Northeast Corridor, service where we used to provide it every day 

of the week, or 5 or 6 days a week, we would go down to 4, 3, or 

2 days a week. 

And what we found is that when we reduced the frequencies on 

a daily basis, we saw the bottom drop out in terms of the folks who 

would take the train on those routes because there were less opportunities, like on a round trip, to come back on the same day. People 

just stopped thinking about using the train. So there are those 

kinds of unanticipated consequences we just need to be mindful of. 


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But this is a point that the Postmaster General reiterated again 

yesterday—I appreciate your raising it again today. 

Mr. PULCRANO. Thank you for listening. 

Senator CARPER. Thank you very much. Mr. Kidd. 

Mr. KIDD. Sir, I would like to just express my appreciation to you 

and your staff for giving me the opportunity to be here and I look 

forward to working with them as we go forward. 

Senator CARPER. Thank you. Ms. Sutley. 

Ms. SUTLEY. Thank you, Senator. One thing I don’t think we 

talked a lot about today was how we reached out when the President signed the Executive Order to all Federal employees to solicit 

their ideas—— 

Senator CARPER. Oh, good. That is smart. 

Ms. SUTLEY [continuing]. About how we can green the workplace, 

and—— 

Senator CARPER. Did you get a lot of responses? 

Ms. SUTLEY. The responses were overwhelming. We had a voting 

system and we had 165,000 votes. We had a lot of really good 

ideas, and I think there is such interest and enthusiasm among 

Federal employees, both civilian and military, for greening the 

workplace, great ideas to save money and great ideas to make their 

workplaces better places to work, and these are ideas that will not 

only help the Federal Government save money, but are also ideas 

that could be shared among non-Federal, State and local government and private sector employers, too. But we were just bowled 

over by how much enthusiasm there was among Federal employees. 

Senator CARPER. Well, that is great to hear. 

I do have another question for you. Some of you already mentioned ideas. I don’t want to let a panel like this slip away without 

asking for you to add some things to our ‘‘to do’’ list here, not just 

in this Subcommittee but in the Congress, things that we can do 

to help support the initiatives that will enable us to not just reduce 

greenhouse gases, not just reduce our dependence on fossil fuels, 

but save us real money. 

Some of you mentioned a couple of things that would be helpful 

for us to do. Maybe if you could each give us another idea or two. 

You can reiterate what you have already said, but just give us a 

couple of items for our ‘‘to do’’ list here, please. What can we do 

to help? You have mentioned a number of things that we are doing, 

that we have done, but if you also mention a couple of things we 

ought to be doing or should consider. If you have another idea or 

want to reiterate one, please, use this opportunity. Anybody? 

Ms. SUTLEY. Let me just start with a little bit of an overview, 

just to say that in asking the agencies to do these sustainability 

plans, I think we will learn a lot, and we have already heard them. 

These folks are the real experts about some of the impediments 

and barriers and things that—in the complex series of rules that 

the Federal Government lives under, both budgetary and otherwise. I think we will learn a lot about where there may be impediments that we need to remove, and you have heard some of them 

today. We would just be very interested in continuing the discussion with the Subcommittee and with yourself about some of those 

ideas. 


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Senator CARPER. OK, thanks. 

Mr. Kidd, I know you mentioned at least one of them and said, 

I think, something to the effect of giving other agencies outside the 

Department of Defense some of the same prerogatives that the Department enjoys, but if you want to mention that one again or any 

others, go ahead. 

Mr. KIDD. Sir, I will just mention the ones I was able to get on 

your provided piece of paper here in a short amount of time. Earlier, there was an interagency working group and we submitted a 

range of suggested legislative actions to your Subcommittee and 

other committees that went through that, and so your staff have 

those. I will highlight a few things that were in there as well as 

some others. 

(1) Expand the power purchase and enhanced use lease authority 

to all agencies. (2) Extend the term of a renewable power contract. 

Right now, the Federal Government cannot buy renewable power 

for more than 10 years, for example, biomass power for a plant, 

which adds price volatility to some of our renewable actions. (3) I 

mentioned reduce the cost of capital for Federal ESPC projects. (4) 

Clarify under the ESPC authorities the ability to use combined 

funds and recognize the implications that it has in the budget process. (5) And then also allow for expanded generation capacity for 

agencies to receive back the money that they would create from expanding their authorities. 

For example, we have a number of turbines across America in 

Federal dams. These turbines are working fine. They are in the 

middle of their engineering life. They have 16 or 20 more years to 

go before we would ever want to replace them. But if we were to 

replace them with newer technology, we could increase by 5, 10, 15 

percent the amount of power produced by that dam for the same 

amount of water, but there is no financial incentive for the agency 

that owns the turbines to do so now because they don’t get to keep 

the difference or any portion of the difference. And we could generate a longer list with more time. 

Senator CARPER. I have always been intrigued by how do we harness financial incentives in order to drive good public policy behavior, and whether it is in health care and incentivizing people to 

take better care of themselves, stop smoking, lose weight, that kind 

of thing to help drive down health care costs to agencies. 

The Veterans Department, when they sell a property, they get to 

keep part of the proceeds. Meanwhile, we have all these tens of 

thousands of abandoned properties, surplus properties that we 

don’t need that we pay security and utilities for. For the most part, 

the agencies that own them, they have to spruce them up to sell 

them. They don’t get any money to spruce them up, get them ready 

to sell, and then when they sell them, they don’t get to keep any 

of the proceeds. With the VA, we do. They get to keep maybe 20 

percent of the proceeds to use in their programs. 

What you just said just reminds me of financial incentives and 

I especially like that idea. Thank you. 

Mr. Pulcrano, last word? 

Mr. PULCRANO. Well, I think I have raised the issue that we are 

most concerned about at this time. I thank you for the opportunity. 


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Senator CARPER. Not at all. In closing—let me see, what time is 

it? It is about 4:15. In about 4 hours and 45 minutes, my colleagues 

and I will be over in the House of Representatives, and we will be 

hearing from the President there who will begin addressing us and 

our Nation around 9 p.m. Eastern time this evening. We expect 

him to talk about a whole lot of things, our economy and how to 

create more jobs, how to get this economy moving even more quickly in the right direction, what to do to try to extend health care, 

not just to people who don’t have it, but how to rein in the growth 

of health care costs and improve quality outcomes. 

He is going to be talking with us about how to reduce our Federal budget deficit and the flood of red ink that we have seen rising 

over the last 9 years now, to try to slow that down, to stem that 

flood. There are a number of things on that point that I expect him 

to talk about. We expect him to call for a freeze, essentially a 

freeze on domestic discretionary spending starting in the next fiscal 

year for 3 years and then extend it beyond that to not exceed the 

rate of inflation. 

We expect for him to call for the establishment of a bipartisan 

commission that would be empowered to look at our government 

rather broadly with respect to especially entitlement programs, but 

other spending, as well, and to come back to us with recommendations on what to do to help rein in their costs a bit and to make 

them more sustainable for the long term and to talk to us honestly 

about revenues, a panel of Democrats and Republicans, maybe 

drawing from some of my former colleagues, people that have 

worked here that now are doing other things with their lives. And 

those are all good and important. 

When President Obama was a U.S. Senator, I remember being 

in the Senate Chamber on the last day that he spoke as a Senator. 

It was right after the election. And I wrote down on the back of 

an envelope and I gave to Melissa about six or seven things that 

the Subcommittee had been looking at that would enable us to 

spend our money more wisely. He said, ‘‘I can’t read your handwriting.’’ [Laughter.] 

Actually, he probably could, if he tried. But he said, why don’t 

you put it in a letter or memo to me so not only I can read it, but 

other people will be able to read it, as well. And among the things 

I suggested to him, if we are interested in controlling spending and 

being better stewards of taxpayers’ dollars, go after improper payments. That is the amount of money that is being misspent, largely 

overspent, in the tens of billions of dollars every year. 

And not just go after improper payments, but all levels of Federal Government domestic spending, and defense spending, entitlements. But when we find out that we have improperly spent 

money, that it has gone to places it shouldn’t go, go out and get 

the money back. And in some cases, hire a private contractors to 

do it and let them keep a portion of the money that we have recovered. 

And we are starting to do that at Medicare. I think last year we 

recovered $700 million in just three States from fraud, going after 

the money—I think they should go after all 50 States. We are going 

to take some of those lessons and go after Medicaid fraud money 


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and recover that, split the money 50–50 with the States and use 

private contractors. 

I mentioned to the President, on the back of my envelope, the discussion that we had a $300 billion annual tax gap, monies that 

are owed to the Treasury and not being collected. We have some 

idea who owes it and we need to do a much better job of getting 

that money. We have major weapons systems overruns, as Dr. 

Robyn probably knows. I think in 2001, the estimate from major 

weapons system cost overruns was about $45 billion in 2001. Last 

year, it was about $295 billion. It flat lines. Actually, the last 2 

years, I think the level of overruns has been flat, but it is still a 

huge amount of money. 

I mentioned all that surplus property, a lot of which is just hanging around. We need to figure out what we can offload and stop 

spending money on utilities and security and so forth there. 

We also found out that there is a huge focus these days on cyber 

security, not just kids trying to hack into our systems, not just 

criminal elements, but literally sovereign nations and elements in 

other nations trying to steal our identities, steal our secrets for 

weapons systems and do other kinds of mischief. There is a lot of 

focus on that, not nearly as much focus on how much we spend on 

IT, system development, and how we don’t do a very good job of 

understanding what we need and managing the IT system development. 

And all those are just ideas. Those are things that will enable 

us to be better stewards. If we just work on all of them and focus, 

we will be better stewards of our taxpayer dollars. 

And another great example of how we can save a lot of money 

for our taxpayers is what you have all been talking about here 

today. In the case of a number of agencies, we are really starting 

to realize a substantial savings. And the great thing about it is for 

those of us who care about the environment, and we all do, this 

does good things for our environment. We reduce our reliance on 

foreign oil. It makes us more energy independent. We do good 

things for the air that we breathe and we create the opportunity 

for a lot of innovation in this country, a lot of development of new 

products that we can not just consume and use in the Federal Government, but all across our country, and we can sell them in other 

countries. 

Just as I said earlier, I was talking with the CEO of Cummins 

earlier today and they were telling me about all the products that 

they are developing here and selling around the world to conserve 

energy and reduce pollution. So there are a lot of payouts. This is 

not just a win-win situation, it is a multiple-win situation. 

We need to be setting a good example in the Federal Government. We need to be leading by our example. In some cases, we 

don’t provide very good examples. I think in this case, we are providing a good example. We are providing the kind of leadership 

that is needed. And to the extent that those of us in the Legislative 

Branch can be supportive and more encouraging, we want to do 

that. You have given us some good ideas, so we thank you for 

those. 

Thank you very much for your testimony today. Thank you for 

what you are doing with your lives. And just extend to your colVerDate Nov 24 2008 11:12 Jan 05, 2011 Jkt 056839 PO 00000 Frm 00034 Fmt 6633 Sfmt 6633 P:\DOCS\56839.TXT SAFFAIRS PsN: PAT

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leagues when you go back to work that we are mindful of the work 

that is being done and grateful and just keep it coming. 

With that having been said, we will adjourn. Oh, one last thing. 

Some of my colleagues who were unable to join us today will want 

to submit questions for your responses in writing. I would just ask, 

when you receive those, just respond to them promptly. 

Thank you so much. 

[Whereupon, at 4:24 p.m., the Subcommittee was adjourned.] 


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