A Long, Urgent To-Do List for the New Secretary of Energy
Former Michigan Gov. Jennifer Granholm, who faces a Senate hearing tomorrow on her nomination to be Secretary of Energy, has a daunting, pivotal task ahead. If confirmed, she will oversee an agency that is central to many of President Biden’s bold climate policy commitments. She’ll also be inheriting a backlog of work and a shortage of career staff resulting from the Trump administration’s efforts to erode the department’s clean energy activities.
DOE traditionally spends $8 to $9 billion per year on energy research, development, demonstration, and deployment and is staffed by the nation’s leading technology experts and researchers. The agency will be critical to realizing President Biden’s climate policy goals. These include commitments to: achieve a 100 percent clean electricity grid by 2035; position the U.S. auto industry to win the 21st Century with zero-emission vehicles; accelerate domestic clean energy manufacturing; make energy efficiency upgrades to 4 million buildings and weatherize 2 million homes over his first term; and drive innovation in key climate and clean energy technologies—all while advancing environmental justice and creating millions of family-supporting jobs.
Governor Granholm has signaled she would take DOE in a new direction to tackle the climate crisis head-on and create new economic opportunities. She is, in her own words, “obsessed with seizing the opportunities that a clean energy future will provide for American workers.” Here are some of the much-needed changes at DOE—some require congressional action, but many can be accomplished with existing authority.
Institute a Clear Focus on Our Compounding Crises
Granholm can start immediately by providing top-down direction for the agency’s energy programs to reorient toward combating the climate crisis, advancing racial, environmental, and energy justice, and building a thriving clean energy economy.
That direction will matter beyond its symbolism. Each applied energy office at DOE (e.g., the Office of Energy Efficiency and Renewable Energy or the Office of Fossil Energy) should evaluate the opportunities, within the constraints of existing appropriations, to shift its activities to align with the topline climate, economic, and justice goals. DOE should also incorporate new criteria—for example, to evaluate projects on pollution reductions, energy justice, and social equity metrics—into grant programs to make better use of existing funding and avoid supporting problematic projects. The agency also should adjust existing grant programs, technical assistance, and stakeholder engagement processes to better meet the needs of communities dealing with high energy costs or excessive pollution and make resources readily available to community organizations, tribal nations, and municipal governments.
Granholm will not be able to fully redirect the ship without the help of Congress to cement a new mission for DOE, increase funding for the clean energy side of the agency, and provide clear authorization to address the crises we face.
Deploy Clean Energy & Create High-Quality Jobs
Granholm has a history of speaking emphatically about the need to create high-quality jobs (ones that include family-sustaining wages and benefits and a safe and healthy work environment) in the clean energy economy. As governor, she was a strong advocate for clean vehicle incentives to create jobs in Michigan. Her history aligns with the president’s campaign commitment to create millions of high-quality jobs to combat the climate crisis. While DOE already creates jobs by supporting domestic clean energy industries, it will need a large expansion in deployment and infrastructure funding to become the job growth engine we need. DOE must also institute strong job quality and labor standards to ensure creation of career-track jobs, especially in disadvantaged communities, and “upskill” and re-skill dislocated workers to support a just and equitable transition (these blogs have more on this topic).
DOE’s $8.8 billion budget for energy innovation in 2020 only included about $500 million for deployment. As we argued in a 2019 NRDC report and Jake Higdon and I argued again in a Data for Progress report last year, the agency needs massive expansion of existing programs and significant new efforts to drive innovation, create good jobs, and cut pollution (see the figure below). Funding increases should include substantial new support for state and local governments to tackle climate change, including through expansion of the agency’s State Energy Program and reauthorization of the Energy Efficiency and Conservation Block Grant program. New investment programs are sorely needed to target funding for energy transition communities, ensure that displaced energy workers receive the benefits they earned, and support economic development and diversification in struggling communities.
Funding increases, and new job-creating deployment programs, require action from Congress. But in the meantime, Secretary Granholm can make progress now.
For example, the agency’s appliance standards and building codes programs are proven tools to accelerate adoption of energy efficient appliances, save households money, and reduce pollution. The Trump administration weakened these programs and delayed new standards. Granholm will have her work cut out for her to get these efforts back on track, but the Biden administration has already taken the first steps.
Secretary Granholm can also ensure that the entire federal government makes the most of DOE’s expertise. Other agencies—including Transportation, Housing and Urban Development, Health and Human Services, and Agriculture—have large pots of funding for infrastructure and deployment that intersect with DOE’s technology development work. Collaboration can help ensure that, for example, HUD’s housing investment programs support highly efficient new buildings and retrofits. Such collaboration will be especially important for reaching the president’s goal of weatherizing 2 million homes in his first term. One of the only existing DOE programs available to help achieve that result—the Weatherization Assistance Program (WAP)—is slated to upgrade fewer than 150,000 homes (out of 40 million that need upgrades) in four years at current funding levels. While we certainly need a large increase in funding for WAP, interagency collaboration can help maximize the use of existing programs to accelerate weatherization.
Refocus on Key Innovation Challenges
Innovation was a theme in President Biden’s climate policy plans on the campaign trail. And for good reason—the plans drew a clear connection between supporting American innovators and creating a thriving clean energy economy supported by domestic manufacturers. Granholm will play a key role in realizing this vision, as DOE is the federal hub for energy innovation.
With growing consensus that the federal government should be spending at least three times as much money on clean energy innovation as it does today (e.g., American Energy Innovation Council, Columbia Center on Global Energy Policy, Data for Progress), fully achieving Biden’s innovation goals will require new funding from Congress. We will be looking to the president’s budget request for significant increases, especially for the industrial, building, and transportation sectors, which are underfunded relative to their share of the climate problem (see below).
Granholm should take immediate steps to leverage existing funding and authority to advance innovative climate solutions, such as long-duration energy storage. DOE’s applied energy programs have $1.8 billion left over from prior year funding that the Trump administration failed to spend, on top of the 2021 budget of about $6 billion. The agency should get that money out the door quickly. The Loan Programs Office (LPO) also has about $40 billion in available capital, which can be used to give loans or loan guarantees to clean energy technologies that have a difficult time securing private-sector funding. DOE may also be able to target LPO support to projects that provide economic benefits to low-income families or cut pollution in overburdened communities. In the bipartisan omnibus package approved in December, Congress reaffirmed its support for the program by expanding the list of eligible projects and creating requirements to hasten LPO processes. It’s time to use this important tool.
Address Nuclear Waste
When DOE was established in 1977, its primary purpose was to house the federal government’s nuclear weapons efforts and advance domestic energy development. Subsequently, the department took on the enormous task of the toxic cleanup of the nuclear weapons complex. The National Nuclear Security Administration and the Environmental Management program that runs the cleanup remain the majority of DOE’s budget. The NRDC nuclear team will be writing after the hearing. But we look forward to hearing Granholm describe the administration’s return to full support of the 2012 Blue Ribbon Commission’s bipartisan recommendation of “consent based” siting process for nuclear waste and her plans to get the cleanup program back on track and fully supported, with publicly accepted decisions.
Build the Team
Granholm and other DOE leaders are starting this critical agency transformation with a staff shortage and work backlog the Trump administration left behind. As we testified last year, the Office of Energy Efficiency and Renewable Energy shed more than 140 career staff over the past four years. The Trump administration failed to backfill positions as career staff departed and built up more than two dozen missed statutory deadlines for energy efficiency appliance standards. The Biden DOE needs to quickly rectify that. Moreover, the administration must get the agency back in shape and start spending money to show Congress that DOE stands ready to handle significant increases in funding to support job creation, foster a green and equitable economic recovery, and combat the climate crisis.