Emerging Idea: Energy Initiatives Office

Today, at the lunch closing GovEnergy 2011, the Secretary of the Army, John McHugh announced the formation of another office to deal with energy. The Energy Initiatives Office Task Force (EIOTF) will be formed not later than 15 September 2011 under the leadership of Ms. Katherine Hammack, the ASA, Installations, Energy and Environment. The Office/Task Force will oversee Soldier Power, Vehicle Power and Basing Power, fusing the responsibility for Facilities Energy and Operational Energy.

According to the press release, the EIOTF is focused on “on-site, large scale RE generation”. They will be able to provide the expertise that bases are supposed to lack to “identify and evaluate technologies, negotiate with utilities, and manage the construction, operations and maintenance of large scale renewable energy projects”. The Office Task Force estimates that, in order to reach the goal of 25% RE at installations by 2025, investments of over $7B over the next ten years will be required to generate the additional 2.1 million megawatt hours required.

The EIOTF plans to leverage the memorandum of agreement signed between DOE and DOD in September of last year. Presumably, in accordance with the memo, DOE will provide personnel and expertise to DOD in a fully reimbursable rate that will include Labor (including labor hours and skill mix), Materials (including any equipment), Travel, Other Direct Costs, Laboratory Directed Research and Development (if applicable), Overhead, Federal Administrative Charge (if applicable). From personal experience, this can be very expensive. While DOE can provide the technical expertise, hopefully, industry will be part of the team. Understanding business concerns is key to creating business cases.

The Residential Community Initiatives (RCI) model will be used by the EIOTF. RCI is the Army’s portion of the DOD Military Housing Privatization Initiative (MHPI). The program “is a public/private program whereby private sector developers may own, operate, maintain, improve and assume responsibility for military family housing, where doing so is economically advantageous and national security is not adversely affected”. One of the important aspects of RCI is that the government begins the National Environmental Policy Act process before solicitations are issued. If this is copied by the EIOTF it will certainly expedite the process.

The composition of the Office is not yet established and its guiding document, the Army’s Renewable Energy Execution Plan is as yet unpublished. If the EIOTF lives up to its goal of “streamlining existing acquisition processes and [leveraging] industry for the execution of large scale renewable and alternative energy projects” there is goodness in the idea. There is also a need for similar efforts on the conservation side of the equation. ESPCs and UESCs need work to improve the process of reducing electricity requirements via third party financing. After speaking with dozens of industry representatives on the floor of GovEnergy for the last three days, I assure you, industry is ready. What they want to see is clear delineation of who is responsible, what authorities are available and how accountability will be held. Simply saying that Net Zero is a goal is insufficient. Unless a commander somewhere is given the responsibility, appropriate authorities (resources) and knows that he/she will be held accountable, there will be no sense of urgency. The unit does well what the boss checks. Dan Nolan