24 July 2001

DOE Official Says New Technologies Needed to Address Climate Change

U.S. Deputy Secretary of Energy Francis Blake says the president's commitment to address the problem of climate change will require the development of new technologies that can increase energy supply and reduce greenhouse gas emissions.

In his statement to a Senate hearing July 24 on proposed legislation related to global climate change, Blake projected that U.S. emissions of carbon dioxide -- the main greenhouse gas blamed for global warming -- will be growing at an average annual rate of 1.4 percent by 2020. "We will need a concerted effort to reverse this trend," he said.

The president's recently-announced National Climate Change Technology Initiative directs several agencies, including the Energy Department, to work with universities, national laboratories and industry to develop cutting-edge technologies that promise low-cost reductions of greenhouse gas emissions.

In this regard, Blake said the Energy Department is already sponsoring technology advances in several areas. Advances in wind power, for example, have led to an eight-fold drop in energy production costs -- to about five cents per kilowatt-hour in some locations -- making wind competitive in those areas with many conventional power generation technologies.

Blake said that geothermal power plants, once restricted to the geysers area in northern California, are now operating in four states. Biomass technologies, which make use of renewable plant materials such as sawdust, are now being used in 350 U.S. power plants providing 7,000 megawatts of power. And the U.S. photovoltaics industry, which uses sunlight to generate electricity, has developed into a thriving business with annual sales of $500 million.

Following is the text of Blake's statement:

Statement of The Honorable Francis Blake
Deputy Secretary of Energy, U.S. Department of Energy
Before the Committee on Energy and Natural Resources United States Senate

Tuesday, July 24, 2001

Mr. Chairman and Members of the Committee, I welcome the opportunity to testify on S. 597, the Comprehensive and Balanced Energy Policy Act of 2001; S. 388, the National Energy Security Act of 2001; and S. 820, the Forest Resources for the Environment and the Economy Act.

In June 2001, the President announced his commitment to develop an effective and science-based approach to addressing global climate change. A cornerstone of that commitment is the deployment of existing technologies and the development of new technologies that can increase energy supply, promote energy efficiency, and reduce greenhouse gas emissions.

The Energy Information Administration is projecting that U.S. carbon dioxide emissions from energy consumption will reach 1800 million metric tons of carbon equivalent in 2010, and continue to rise to 2000 million metric tons of carbon equivalent by 2020, an average annual growth rate of 1.4 percent. We will need a concerted effort to reverse this trend.

While many different policy approaches to greenhouse gas reductions may be considered, none can be successful without a continuing supply of new, more economically and environmentally sound technology. Prudent technology research and development reduces the costs of new technologies, and expands economic opportunities while lowering emissions. Accompanying public policy can provide incentives for technology investment, diffusion and deployment.

Public support for reducing greenhouse gas emissions depends on combining economic growth with environmental protection. Both can occur if new, lower-emitting, cost-effective technologies are profitable and economically efficient. Forcing costly and less productive technologies into the economy reduces economic growth and inevitably drains public support for emissions limitations. No climate change strategy, no matter how flexible and efficient, can support robust economic growth unless lower cost and higher productivity technologies reducing greenhouse gas emissions are readily available.

Because greenhouse gas emissions come from many sectors of the economy, a broad range of technologies will be needed. Such a portfolio of technologies could include energy efficient technologies, lower carbon-emitting technologies, carbon capture, storage and sequestration technologies, and new technological discoveries yet to be made.

To assure that we can meet our technology needs to reduce greenhouse gas emissions, the President created the National Climate Change Technology Initiative and directed the Secretary of Energy, the Secretary of Commerce and the Administrator of the Environmental Protection Agency to: 1) evaluate the current state of U.S. climate change technology research and development and make recommendations for improvements; 2) provide guidance on strengthening basic research at universities and national laboratories, including the development of the advanced mitigation technologies that offer the greatest promise for low-cost reductions of greenhouse gas emissions; 3) develop opportunities to enhance private-public partnerships in applied research and development to expedite innovative and cost-effective approaches to reduce greenhouse gas emissions; 4) make recommendations for funding demonstration projects for cutting-edge technologies; and 5) develop improved technologies for measuring and monitoring gross and net greenhouse gas emissions. The National Climate Change Technology Initiative also will enhance coordination across federal agencies and among the federal government, universities, and the private sector. We are now at work implementing the Presidents initiative and will be able to report back to the President later this year.

We are making progress on other fronts as well. In mid-July, the President announced new agreements that involve DOE. The first is an agreement with the Nature Conservancy to study land use and forestry practices for storing carbon more effectively in Brazil and Belize. The second is with an international team of energy companies to develop a new set of technologies for reducing the cost of capturing and sequestering carbon dioxide from fossil fuel combustion plants. There are other Federal agencies, notably the Environmental Protection Agency and the Department of Agriculture, with programs that address climate change through technology research and development and deployment.

The Administration is engaging on the international front as well. As we speak, the United States is participating constructively in international discussions on climate change at the continuation of the Sixth Conference of the Parties to the Framework Convention on Climate Change in Bonn, Germany.

At the Department of Energy, we have multiple programs aimed at addressing climate change both indirectly through improvements in energy efficiency and R&D on renewable energy sources, and directly through R&D programs aimed at sequestering carbon. Our programs, many in partnership with industry, address: efficiency improvements in end use, distribution, transmission, and generation of electricity; increased use of energy-efficient electro-technologies; reducing CO2 emissions through increased efficiency of coal and gas-fired plants; promotion of greater use of lower carbon fuels such as natural gas, nuclear, or renewable energy; transportation actions, including greater use of natural-gas-powered and electric vehicles; recovery of methane from landfills and coal seams; and the use of fly-ash as a cement substitute. We've enjoyed numerous successes over the years and I'd like to highlight a few examples.

DOE-sponsored technology advances in wind power has led to an eight-fold drop in cost, to about five cents per kilowatt-hour in areas with the best resources. In these locations, wind is competitive with many traditional generation technologies. Geothermal power plants, once restricted to the geysers area in northern California, are now operating throughout California and in Nevada, Utah, and Hawaii. Scientific advances have enabled successful geothermal power plant construction and operation in these four states. Installed geothermal power plant capacity now exceeds 2800 megawatts. Over 400,000 geothermal heat pump applications have a total thermal capacity of 3600 megawatts in the United States. Biomass power has grown to 350 U.S. power plants providing 7000 megawatts of power. New technologies that boost the efficiency and cleanliness of biomass power are now being tested. Through technology advances achieved by DOE research and development, the performance of renewable technologies has increased while the costs have dropped dramatically. Combined with a more detailed knowledge of renewable energy, these advances have accelerated the market for renewable technologies.

Starting from a few research and development firms supported by federal funding, the U.S. photovoltaics industry has developed into a thriving business with annual sales of $500 million. Thin-film photovoltaic cells are now doubling as rooftop shingles. DOE research on thin-film photovoltaic cells and a growing interest in integrating photovoltaic cells into buildings have resulted in this new building material that generates electricity-using sunlight. The energy generated from a building's rooftop shingles can provide power both to the building and to the utility's power grid. Several demonstration projects, including a solar rooftop system showcased at the Southface Energy and Environmental Resource Center in Atlanta, Georgia, have proven that these innovative shingles can provide clean electricity.

Geothermal heat pumps are one of the most cost-effective heating and cooling systems available. A typical system can reduce energy consumption by 23 to 44 percent compared to traditional heating and cooling systems. While geothermal heat pumps are typically more expensive to install, their greater efficiency means the investment may be recouped in three to ten years. Experience has shown that use of geothermal heat pumps can be beneficial to electric utilities and their customers.

DOE's appliance standards program for clothes washers, furnaces, air conditioners, water heaters and fluorescent lamp ballasts helps reduce carbon emissions by reducing demand for electricity generated by fossil fuels.

Nuclear energy will continue to play a significant role reducing greenhouse gas emissions. DOE's research program on fuel improvements for light-water nuclear reactors created a technology that currently enables 50 percent more energy to be extracted from each unit of nuclear fuel, with prospects for greater increases in the future. This technology, called "extended burnup," is now being implemented worldwide in water-cooled reactors. Its widespread use also has several other independently valuable consequences, such as increasing the output of nuclear power systems, which do not produce greenhouse gases. Extended burnup reduces fuel cost for each operating reactor by several million dollars per year and permits utilities to extend the time interval between refueling outages from 12 months to 18 or 24 months. Also, by more fully using each unit of nuclear fuel, the amount of spent nuclear fuel that must be stored today is reduced by one-third.

The President's National Energy Policy will build on these successes. The Policy addresses conservation, energy efficiency, and cleaner sources of energy. In particular, the President's clean coal initiative builds on the success of prior public-private partnerships in clean coal technology. From 1986 to 1993, government and industry sponsored 38 first-of-kind clean coal technology projects in 18 States. Before this program, only a few options existed for reducing pollutants released from coal, and almost all were expensive. DOE's Clean Coal Technology Program changed that. Today, because of the clean coal investment, 75 percent of U.S. coal-fired power plants now use, or are installing, low-cost, low-polluting burners to reduce smog-forming nitrogen oxides. Power plants can now turn coal into a gas and remove virtually all of its smog- and acid rain-forming impurities, creating a fuel that rivals natural gas in environmental cleanliness. Also, like natural gas, coal gas can power "combined cycle" arrangements of gas and steam turbines that boost fuel efficiencies and reduce greenhouse gases.

I would like now to turn my attention to the several energy policy bills that are the topic of the hearing today.

In examining these three bills (S. 388, S. 597, and S. 820), it is clear that we share common goals though there are, of course, differences in the relative emphasis placed on different goals. I think, for instance, that we can all agree on the importance of energy research and development and the role of new technology in helping us to blunt the horns of our energy and environmental dilemma. There appears to be a consensus on the importance of public investment in energy efficiency. And there are several areas where the need for updating the regulatory regime under which energy is produced, transported, and sold is manifest.

Consistent with the emphasis on R&D and technology in the energy bills under consideration, we are, as I mentioned earlier, working on the President's National Climate Change Technology Initiative, which will help us define a technology future that explicitly addresses climate change. In addition, DOE, in partnership with USAID and the Department of Commerce, has been working on the Clean Energy Technology Exports initiative, which originated in Senate report language accompanying the FY2001 Energy and Water Development Appropriation Bill and is a component of the President's National Energy Policy as well as being reflected in Section 111 of S.597. The goal of the initiative is to facilitate private sector efforts to launch clean-energy technologies into international markets by improving the government's role in clean-energy research, development, demonstration, and deployment.

In closing, the Administration welcomes the Committee's efforts to address our Nation's climate change challenge and its strong support of the Department's energy science, research and technology development programs. The legislation under consideration by the Committee is ambitious and many of its provisions would have consequences that must be weighed carefully before enactment. In this regard, I request that the Department be given the opportunity to continue to work with the Committee on those provisions in the bill that affect DOE's programs.

Mr. Chairman, that ends my testimony and I would be happy to answer any questions the Committee may have at this time.

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