JON MICHAEL DAVIS NOMINEE FOR THE POSITION OF ASSISTANT SECRETARY FOR CONSERVATION AND RENEWABLE ENERGY BEFORE THE COMMITTEE ON ENERGY AND NATURAL RESOURCES JULY 18, 1989 Mr. Chairman and distinguished Members of the Committee, I appreciate the opportunity to appear before you today as President Bush's and Secretary Watkins' nominee for the position of Assistant Secretary for Conservation and Renewable Energy of the U.S. Department of Energy. I am proud to be nominated and to have the opportunity to serve under this administration, particularly at this time of increased awareness of energy supply and environmental protection. I share Secretary Watkins' commitment to developing and carrying out the President's national energy strategy and to fulfilling the mandates Congress has established in law for the Department. If confirmed as Assistant Secretary, I will uphold the standards for government service established by President Bush and consider it a privilege to work with this Committee and the Congress to move towards an environmentally safe and nationally secure energy future. Today I would like to briefly relate my personal background to the challenges of public energy policy and the opportunities for conservation and renewable energy technologies BACKGROUND AND EXPERIENCE In for the the Having grown up in the Northeast part of Washington State, my earliest involvment with the energy business was work experience in the heavy construction business required mining, logging, and hydroelectric power generation. process, I gained a solid respect for these resources and effort necessary to utilize them productively. My formal education at both the United States Air Force Academy and at the University of Illinois provided a technical basis for my career. I am a registered professional engineer in Colorado. Force experience My active-duty Air included engineering design and construction in the United States and Vietnam, followed by a four-year tour on the faculty of the Air Force Academy. At the Academy, I developed and taught a solar energy curriculum and directed solar research at the graduate level. As part of this tenure, I helped convert an existing house into a solar design laboratory. My energy conservation activities began in earnest at the Air Force Civil Engineering Center. I served with a group of engineers consulting on energy conservation opportunities in Air Force facilities worldwide. As a result of these assignments, I was recruited to join ERDA, which soon became DOE. While at DOE, I managed the National Solar Heating and Cooling Program which directed $80 million in research and development project funding. DOE's policy at the time focused on specific technologies rather than end-use applications. An unfortunate result of this policy was that different programs very often competed with one another, rather than yielding the best technology for each end-use application. This approach made it very difficult to transfer the technology to those who would put it to use. In 1980, I joined the Solar Energy Research Institute in Golden, Colorado to establish a solar buildings division. Our purpose at SERI was to categorize the various conservation and renewable energy technologies available to the buildings marketplace so that owners and operators of any type of building could view their energy options and make informed economic choices. Having experienced the state-of-the-art technologies and observing the potential for marketing these advancements, I became an investor and principal in a solar firm established by a former co-worker and helped build a very successful solar water and space heating sales and installation company. Our installed sales averaged over $12 million per year for three years. These systems were of high quality and continue to operate successfully in Colorado, Oklahoma, Texas, Louisiana, Arkansas, and Kansas. In 1986 I started my own design/build mechanical contracting company and through careful customer education have been successful in carving out a small market for energy efficient heating and cooling systems for residential and light commercial buildings. As a result of these experiences, I am strongly convinced that credible and timely information. properly presented, will move consumers to better energy consumption and utilization choices. Admiral Watkins has indicated that he wants the Department to have high credibility with Congress and the American people. My ideas and approaches for improving the conservation and renewable energy programs gained from prior government service the and direct technology experience in industry will complement foundation being built by the Admiral for the Department of Energy. AN ASSESSMENT OF CONSERVATION AND RENEWABLE ENERGY PROGRAMS In recent years, there has been substantial debate concerning the federal role in support of conservation and renewable energy technologies between those who advocate a limited role for the federal government and those who believe the federal role should be broadened. It is not my purpose to defend or denigrate either of these positions; rather, I would like to present some thoughts on the central themes of this debate. In doing so, I believe I can show that as the Assistant Secretary for Conservation and Renewable Energy I can work with Congress, and the public and private sectors to enhance the DOE programs while remaining sensitive to concerns about the budget. The technologies in the conservation and renewable energy area differ markedly from technologies in other areas of DOE. The most significant difference is in the breadth of these technologies. These technologies directly affect industries in buildings, industrial process heat, utilities, transportation, and even governmental programs at the state and local level. In support of these industries, research is being pursued on fuels, engines, materials, superconductors, "smart" windows, genetically designed microbes and on and on. As an example, the DOE photovoltaic program has met every cost and efficiency goal to date and this technology could soon be ready to move into the mainstream of systems providing utility power generation. The private sector will make an investment in this technology if it believes the systems are credible and will provide reliable service to the customer base. A technology at a different level of development is hightemperature superconductors. This activity is best described as long-term, high-risk research with potentially enormous payoff. Federal support is required to enable our industries to be not only the leaders in the science breakthroughs but also become the leaders in the market applications. These are only two examples in a spectrum of federal conservation and renewable energy programs affecting literally dozens of technologies. The proper role for the federal government may be quite different for technologies being investigated at a basic science level versus a technology being introduced into a market. The conservation and renewable energy technologies represent and affect a vast constituency in this country. As an agency of the government, DOE is unique in that it serves the public "on both sides of the meter". 21-620 0 - 89 - 2 As a nation we no longer feel the sense of urgency on energy issues we felt in the 1970's. Fossil fuel prices have fallen substantially and our emphasis on conservation during the previous decade has helped bring about a change from a condition of tight supply to one of over-supply in fossil fuels. This over-supply condition has hurt our domestic petroleum industry, since many countries have lower-priced product they can export to this country. We are once again importing approximately half our domestic consumption of petroleum products. Much of that imported petroleum product is from politically unstable portions of the globe. This market condition also is responsible for onethird of our trade deficit (over $40 billion last year). Environmental dangers have again raised public concern about our energy future; however, we still have not properly addressed the issues of energy supply, security and energy's effect on U.S. competitiveness in international markets. If we really are sincere about preserving a strong America for future generations, one step must be appropriate, long-term investments in our energy future, with stable, predictable funding paths. We DOE is currently compiling the best energy data available to support development of an integrated national energy strategy. will then be able to analyze all viable energy paths while appropriately considering environmental and economic impacts. The best near, mid, and long-term investments among paths and within paths should become much more obvious and supportable. Conservation and renewable energy technologies have been both oversold and undersold. The questions remain: What are the best investments to make, and whose data do you believe? I am not able to answer these questions today, but I will dedicate myself to an appropriate and open process that does. In the past, Congress has viewed DOE's commitment to conservation and renewable energy with some suspicion, and there has been some justification for that. As a result Congress has taken an active role in directing the course and content of DOE's programs. Let us begin today a new effort to work cooperatively to achieve the goals we all share and provide DOE's new management the flexibility we need to execute the program for best effect. Mr. Chairman, if confirmed, I look forward to working with members of this Committee to develop a credible national energy policy that will support an appropriate contribution from conservation and renewable energy technologies. Thank you very much. The CHAIRMAN. Thank you very much, Mr. Davis. Mr. Easton. STATEMENT OF JOHN J. EASTON, JR., NOMINEE TO BE ASSISTANT SECRETARY FOR INTERNATIONAL AFFAIRS AND ENERGY EMERGENCIES, DEPARTMENT OF ENERGY Mr. EASTON. Thank you, Mr. Chairman. It is an honor to appear before your committee as the President's nominee to be the Assistant Secretary for International Affairs and Energy Emergencies. And I appreciate the President's confidence in me, as well as that which Secretary Watkins has expressed. I have had the opportunity to previously serve in elective office and I know how important it is for the cooperation between the executive branch and the legislative branch of government. And I commit to you that bringing that experience to this post, I will work very closely with this committee, as well as other members of Congress and the Congress itself, as we pursue our joint objectives on behalf of this country. Let me touch a little on my background and then some of the issues confronting my office. You heard Senator Leahy describe my political background. I am an attorney by profession, having received my law degree here in Washington at Georgetown in 1970. I practiced law in Vermont for a number of years and held posts, both appointed and elected, in Vermont. I served two terms as attorney general, and as the Senator mentioned, I was the Republican candidate for governor in 1984. Following my service in state government, I worked for an international consulting firm, Syn-Cronamics, and then returned to private law practice in Burlington, from which I come to this post. The Assistant Secretary of Energy for International Affairs and Energy Emergencies has two primary roles. First, he is the principal spokesman for the Secretary of Energy on matters of international importance. And, secondly, he is the principal international policy advisor to the Secretary. In these two capacities, I expect to work very closely with both Secretary Watkins and Deputy Secretary Moore, as we pursue the national energy strategy, which my colleagues have already mentioned. I think there will be some very essential elements of that strategy that will require significant efforts by my office in the coming year and I would like to share just a couple of thoughts about those elements. First, we must improve energy security, and that demands a continued effort to reduce our vulnerability to supply disruptions. One means of reducing vulnerability is by enhancing our capability to respond to major energy and national security emergencies. Another means is to reduce our vulnerability to supply disruptions by working more closely with our allies and organizations such as the International Energy Agency. Another issue which will confront my office will be that of global climate change. Events in that area have placed that topic on the center stage of international concern and I expect to be playing a |