Oversight and Investigations Subcommittee Examines DOE Reorganization Plans

July 24, 2013

WASHINGTON, DC – The Subcommittee on Oversight and Investigations, chaired by Rep. Tim Murphy (R-PA), today examined the Department of Energy’s management structure and efforts underway at the agency to improve project management and mission performance. In testimony before the Energy and Power Subcommittee on June 13, 2013, newly sworn in Energy Secretary Ernest Moniz pledged, “Improving the management and performance of the Department is one of my top priorities as secretary.” Members discussed the secretary’s plans for restructuring the agency’s management and other changes, which were announced last week.

“The announced reorganization makes some significant changes to the department’s management structure, with a more explicit focus on project management, so-called enterprise-wide mission support, and the integration of the agency’s science and applied energy programs,” said Chairman Murphy. “On paper, these changes look like positive steps to help DOE address the tremendous challenges and opportunities before the agency. On the energy-mission side, we know that the prospects of North American energy production have surpassed all expectations in recent years. How this agency integrates the strength of its world-class science and engineering with its applied energy and various energy infrastructure programs to help maximize the benefits of this new reality for the American public is of key importance.”

“We want a governing framework based on today’s needs, not the antiquated priorities from decades ago,” added Energy and Commerce Committee Chairman Fred Upton (R-MI). “DOE has significant responsibilities that will not and should not go away; the agency must be poised to take on new responsibilities that best serve the energy, environmental, and security needs of the nation. But we also must acknowledge that if we were to start from a clean slate, there is no question an Energy Department for this new era of abundance would hardly resemble the department of today. This committee’s job will be to ensure the department is managed to meet these responsibilities and structured to ensure they are executed in the best interest of the American taxpayer.”

Members expressed concern with a number of programs and operating procedures at DOE, including in the Loan Programs Office, which was responsible for taxpayer-funded debacles like Solyndra, as well as specific concerns regarding the National Nuclear Security Administration and security failures at the Y-12 complex.

David Trimble, Director of Natural Resources and Environment at the Government Accountability Office (GAO) echoed many of these concerns, stating, “As we have reported in the past decade, DOE continues to face challenges managing its major projects and programs, which have incurred significant cost increases and schedule delays in several instances.”

Gregory Friedman, DOE Inspector General outlined his office’s work on oversight of the department and listed a number of areas where management challenges were present last year. “For Fiscal Year (FY) 2013, our list of significant management challenges includes: Operational Efficiency and Cost Savings, Contract and Financial Assistance Award Management, Cyber Security, Energy Supply, Environmental Cleanup, Human Capital Management, Nuclear Waste Disposal, Safeguards and Security, [and] Stockpile Stewardship,” said Friedman. “Given the inherent nature and complexity of these challenges, they are not amenable to immediate resolution. Thus, these challenges must be addressed through a concentrated, persistent effort over time. ”

Daniel Poneman, Deputy Secretary of Energy, explained the motivation behind, and his role in, the recently announced reorganization proposals. “Last week the Energy Secretary and I announced a reorganization that will better focus our efforts on all four mission areas of the Department: nuclear security, solving the Nation’s energy challenges, advancing fundamental science, and environmental stewardship. For the Department to carry out our critical work in these areas, the Secretary has made clear that we must renew our focus on improving our management and performance in addressing the challenges that the Department has faced for its entire history. For that reason, the reorganization will also focus heavily on increasing the focus on management and establishing a system of Departmental Councils to improve coordination of issues that cut across organizational lines,” said Poneman.

He concluded, “These organizational changes will enhance the Department’s ability to carry out its responsibilities to the President and to the Congress, while improving our financial stewardship at a time of tight fiscal constraints. Reducing the cost of doing business within the Department will enable us to allocate more resources toward our mission objectives in national security, science, clean energy, and environmental stewardship.”

Today’s hearing is part of the committee’s ongoing oversight of DOE management and performance challenges, and will contribute to an oversight record necessary for members to monitor how the agency fulfills its diverse missions while protecting national security, public health and safety, and taxpayer resources.