The Loyal Skeptics: Marketplace on DOD Energy

Excellent piece by Scott Tong from Marketplace on the Military and Energy. Wide ranging discussions with government and industry. Only cause for suspicion is that they interviewed me. Steve Anderson lends greater credibility to us "Loyal Skeptics". Scott also labeled Brutus Charette the "Technologist". He is such a fighter pilot, it hurts! Otherwise, very balanced. Will let it speak for itself. It is a three part series. Dan Nolan

INSS Comes to Defense of DOD Energy Plan: "Next Piece Won't be Vague"

This just in.....DOD publishes DOD Energy Strategy. National Defense University declares that criticism is unjust. They are hopeful.

"Hopefully the implementation plan will address the criticisms voiced about the vagueness of the strategy”, says Dr. Richard Andres.

The Institute for National Strategic Studies lauds the ASD, OEPP for getting a “first piece in the overall energy plan” published just two years after being directed to form by Congress in 2009. Of course the speed with which DOD was able to place a nominee before Congress should have given a clue in that the confirmation hearing did not occur until early 2010.

Not sure what Dr. Andres feels is unjust. The Energy Security Strategic Plan published by the DOD Energy Security Task Force in 2008 was a comprehensive and directive document. Many of its authors work in the office of the ASD/OEPP. I guess my lack of patience is that most of the work had been done; the challenge should have just been in re-coordinating. 

But the fact is, the Services hold all the cards. The only one that Ms. Burke holds is the ability to certify the energy budget for Services against the DOD plan. The longer we wait for the plan, the less time the Services have to ensure their budgets are compliant. Of course, I am not sure what happens if a budget is not certified. Maybe they get another 90 days and a do over. Dan Nolan

Breach or By-Pass: Overcoming Obstacles to DOD Energy Goals

In DOD energy, the vision is clear and the strategic goals are well articulated. What is missing is direction to those who will execute the strategy at the operational and tactical levels. If you ask a Director of Public Works at an Army Post (and I have) what their responsibilities are regarding achieving 25% renewable energy by 2025, they will look at you as if you have an even number of heads.

A recent article in National Defense Magazine questioned DOD’s ability “to turn glossy rhetoric into ironclad policies”. This observation came as results of remarks by former Vice Chief of Naval Operations, ADM (R) John Nathman of the Center for Strategic and International Studies (CSIS). Nathman attributes this in part to a lack of an overall National Energy Policy. I would agree that we do not have a new energy policy, but there are plenty of existing laws and executive orders still in effect.

The current energy policy is expressed in two laws (EPAct 2005 and EISA 2007) and two executive orders, (13423 and 13514). They provide sufficient guidance for DOD to create strategy, operational direction and tactical instruction. The following is what is required of DOD:

Biofuels Target Purchases by 2022 (at market price):

• Cellulosic ethanol 16 Billion Gallons
• Biomass Based diesel 5 Billion Gallons
• Other Biofuels 15 Billion Gallons

Renewable Energy Goals (at “acceptable rates):

• 2010 5%
• 2013 7.5%
• 2025 25%
• 2050 50%

Energy Efficiency Goals (relative to 2003; where economically feasible)

• 2015 30%

The lack of a new national energy policy is not a hindrance to DOD energy planning. What is missing is fixing the responsibilities. The authorities are there (ECIP, MILCON, UESC, ESPC, MATOC, PPA). Because no one is responsible, no one can be held accountable. As one comment I received stated, “who cares about the OEPP plan; show me the budget!".

For operational energy, the acquisition community and contracting command should be getting the rose for figuring out the COTS, GOTs, new development solutions and/or contract modifications necessary. For biofuels, Defense Logistics Agency – Energy will be responsible for that acquisition, but at competitive prices (if Shell Aviation will allow it; how long can Shell sell at a loss?). Infrastructure energy responsibility for renewables and energy conservation will have to devolve upon the Corps of Engineers, Army’s Installation Command, Navy Facilities Command and the Air Force Civil Engineering Support Agency. From there it will pass to the tactical level at the bases and post through the installation command structure. The HOW of this must be in the much promised, forthcoming PLANs. Will every base need to reduce by 7.5% by 2013 or will it be measured as a Service?

There is no question that this is hard work. By Title 10 of the U.S. Code, the Services control the budget. Any plan at the OSD level must be coordinated with (agreed to by) the Services. How hard could that be? Dwindling resources make budgeting agreements hard to achieve. Ask the President and Speaker.

The final piece of the article talked about getting DOD to change their appreciation of the “time value” of money. A dollar spent today on energy conservation saves hundreds in five years, but the Pentagon has been famously “penny-wise and pound-foolish”. As sexy as renewable are, conservation is the best bet for DOD. The smaller the energy foot print, the easier it is to get 7.5% from RE sources. Culture change indeed! Dan Nolan

Acronyms:

• EPAct 2005 – Energy Policy Act of 2005
• EISA 2007 – Energy Independence and Security Act of 2007
• ECIP – Energy Conservation Investment Program
• MILCON - Military Construction
• UESC – Utility Energy Services
• ESPC - Energy Savings Performance Contracts
• MATOC - Multiple Award Task Order Contract.
• EUL – Enhanced Use Lease
• PPA – Power Purchase Agreement
• COTS – Commercial Off the Shelf Technology
• GOTS – Government Off the Shelf Technology
• OSD – Office of the Secretary of Defense