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COMMITTEE ON ENERGY AND NATURAL RESOURCES

JAMES A. MCCLURE, Idaho, Chairman MARK O. HATFIELD, Oregon

HENRY M. JACKSON, Washington LOWELL P. WEICKER, JR., Connecticut J. BENNETT JOHNSTON, Louisiana PETE V. DOMENICI, New Mexico

DALE BUMPERS, Arkansas MALCOLM WALLOP, Wyoming

WENDELL H. FORD, Kentucky JOHN W. WARNER, Virginia

HOWARD M. METZENBAUM, Ohio GORDON J. HUMPHREY, New Hampshire SPARK M. MATSUNAGA, Hawaii FRANK H. MURKOWSKI, Alaska

JOHN MELCHER, Montana DON NICKLES, Oklahoma

PAUL E. TSONGAS, Massachusetts JOHN P. EAST, North Carolina

BILL BRADLEY, New Jersey JOHN HEINZ, Pennsylvania

MICHAEL D. HATHAWAY, Staff Director

CHARLES A. TRABANDT, Chief Counsel
D. MICHAEL HARVEY, Chief Counsel for the Minority

(II)

HODEL AND HESSE NOMINATIONS

WEDNESDAY, DECEMBER 1, 1982

U.S. SENATE,
COMMITTEE ON ENERGY AND NATURAL RESOURCES,

Washington, D.C. The committee met, pursuant to notice, at 10 a.m., in room 3110 Dirksen Office Building, Hon. James A. McClure, chairman, presiding.

Present: Senators McClure, Hatfield, Weicker, Domenici, Warner, Murkowski, Nickles, Heinz, Jackson, Johnston, Bumpers, Ford, Metzenbaum, Matsunaga, Tsongas and Bradley.

Also present: Charles A. Trabandt, chief counsel; E. David Doane, counsel; Gary Ellsworth, counsel; and D. Michael Harvey, chief counsel for the minority. OPENING STATEMENT OF HON. JAMES A. McCLURE, A U.S.

SENATOR FROM THE STATE OF IDAHO The CHAIRMAN. Good morning. The committee will come to order. This hearing is to consider the Presidential nominations of Donald P. Hodel, of Oregon, to be the Secretary of Energy, and Martha 0. Hesse, of Illinois, to be the Assistant Secretary of Energy for Management and Administration.

Today is just as uncertain a time in our country's energy history as was 1977 when the Department of Energy was established. The new Department consolidated at Cabinet level the many Federal energy activities that had previously been dispersed throughout the Government. However, we are still faced today with a major reliance on unpredictable international sources for our energy.

During the past 2 years, the 97th Congress, through the budget and appropriations process, has achieved two major changes in the programs of the Department of Energy. First, excessive Government management of fuels has been removed, thus reducing substantially the regulatory burden that had previously been imposed on industry.

Second, primary reliance has been placed on the private sector for certain energy research and development activities. What remains within the present Department are many programs that are essential to our country's energy future. It is equally essential that these programs be continued at levels of program activity that can respond adequately to the continuing threat from vagaries in international energy supplies that could jeopardize our economic recovery.

It is also essential that these programs remain centralized in a single Federal agency. Examples of these programs include energy emergency preparedness; the U.S. participation in the international energy program the strategic petroleum reserve, Federal power marketing activities, such as those of the Bonneville Power Administration from which Mr. Hodel has come, and nuclear energy development, including nuclear waste disposal, to name just a few of the activities.

Another essential function of the Department of Energy and, in turn, the Secretary of Energy, is to plan, coordinate, and manage a balanced energy research and development program, including coordination of national laboratory activities. This includes the assessment of research and development needs, and the establishment of priorities to meet those needs.

In addition to its civilian programs, the Department is responsible for nuclear weapons development.

For obvious reasons, the formulation and implementation of national energy policy must reside in a Cabinet officer who can serve as the administration's spokesman before the Congress, to the American people, and in the international community. That need has not diminished; and that responsibility will continue to rest with the Secretary of Energy until such time as the Congress acts on the President's proposal to merge the Department of Energy with the Department of Commerce.

Until the Congress acts on that proposal, the Secretary, and other officials and employees of the Department, have the statutory responsibility to carry out the policy and program responsibilities now vested in the Department by the Congress. Proposed changes in the policies and programs of the Department are just that-proposed changes-until they are endorsed in whole, or in part, by the Congress.

I would like to turn now to Mr. Hodel's qualifications to be Secretary of Energy. For the past 2 years, he has served as Under Secretary of the Interior. His job was to manage the day-to-day operations of the Department, and he carried out his duties in an effective and highly competent manner.

Prior to his appointment as Under Secretary of the Interior, Mr. Hodel was engaged for 3 years in the energy consulting business. From 1969 to 1978 he was the Deputy Administrator and then the Administrator of the Bonneville Power Administration. While serving as BPA Administrator, he developed a solid reputation as a capable and knowledgeable manager. He thus brings to the Department of Energy a broad knowledge of energy issues, a professional background, and most importantly, extensive management experience as BPA Administrator and Under Secretary of the Department of the Interior. Mr. Hodel is clearly well suited for the job of Secretary of Energy.

I would ask Senator Jackson if he has a statement he would like to make at this point.

Senator JACKSON. Senator Hatfield has indicated that he has a conflict and must leave and he had requested the opportunity to introduce to this group a friend as well as a fellow citizen of Oregon, and I will yield to Senator Hatfield.

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