The Federal Agency Infrastructure for Implementing an Energy Security Strategy

Across the federal government, most agencies that are likely to play a role in an energy transformation focus on policy (to include international negotiations), regulation, and science. Most of the funding for energy security is concentrated in the science agencies, particularly the DOE National Laboratories and NASA, and NOAA to a lesser extent.

Although there are many links among the policy, regulatory, and science agencies, sometimes at the discretion of federal employees and sometimes by presidential directive or congressional mandate, the actual strength and effectiveness of interagency cooperation is highly dependent on personalities.

Findings

The White House office itself will lack sufficient resources to execute a national strategy, both at the federal level and across the sectors of the economy that would need to engage for success.In order for a National Energy Security Council to succeed, the whole-of-government infrastructure will require some improvements.Several structural issues stood outinthe workshop and in interviews, particularly the weak links for interagency cooperation and uneven or underdeveloped ability to develop implementing strategies and plans.

Some Federal agencies already have coordinating councils, internal cooperation hubs, or policy planning functions. The Department of Transportation, for example, has a Climate Change Coordinating Council that coordinates the climate change-related activities of all of its internal agencies, such as the Federal Aviation Administration and the National Highway Traffic Safety Administration. Other organizations, such as the U.S. Army, have tasked single offices with coordinating all internal energy activities and with disseminating and monitoring implementation of policy decisions. These can improve the agency’s ability to engage in interagency planning and to implement an executive-level energy security strategy. Notably, many agencies lack these capabilities or have relatively weak coordinating and policy bodies within the institution (certainly on energy security), including the Departments of State, Energy, and Defense.

Whether the NSC or CEQ takes on an elevated energy security mission or a new, separate Council is created, the Department of Energy is the logical agency to be the focal point for resourcing and giving traction to the Executive Office of the President’s guidance. But DOE, as it now exists, may not be capable of playing that role; it has important expertise but a dysfunctional structure that hurts morale and hampers its ability to be effective in making and executing policy on core national interests. Since its formation in 1977 bringing together 40 different agencies, DOE has never really gelled into a fully functional, coherent institution.

The Department does have an Assistant Secretariat for Policy and International Affairs, but our interviews suggested that this office has lost prestige and capability in recent years in its policy planning and coordinating functions. DOE’s program and policy offices (e.g., the Office of Science or the Office of Fossil Energy) are not accountable to any direction this office may provide, and this office may or may not involve policy offices in its policy planning.

Strengthening that relationship ultimately is the responsibility of the Secretary. In addition, the National Laboratories house tremendous talent and capability, including innovation talent and skill that will be crucial to an energy transformation, but the system as it stands is unwieldy and expensive with duplicative efforts and important gaps. In many cases, however, the labshave important constituencies in Congress and are a key part of local economies –closing them or reconciling missions will not be easy.

A notable outlier in this system is the Department of Defense, which is a major national consumer of energy and responsible for 78 percent of all federal energy use. Although the department certainly has a strategic imperative to protect access to energy supplies, there is no inherent energy security policy-making role at DoD, and there is mixed opinion inside and outside the Pentagon about whether that should change. There is little disagreement, however, that the power of DoD as a major consumer of energy is largely untapped, although there are concerns within the military and civilian defense leadership about interference with operational effectiveness. Note that mandates in this area have sometimes been helpful: for example, the legislation (P.L. 110-181) requiring the Department to consider climate change in its National Defense Strategy, National Military Strategy, and Quadrennial Defense Review has essentially created a new infrastructure at the Department of Defense in OSD (Policy), the Joint Staff, and the Services that is accumulating expertise on energy and climate change. This includes new interactions and new information-sharing patterns and content.

One of the most important and challenging initiatives for the President-Elect will be putting a price on carbon, but there is no clear institutional home in the federal government for the approach he has advocated (cap and trade). Most legislative proposals to date for controlling carbon emissions have identified the Environmental Protection Agency, which is appropriate given that it is the regulatory agency that now manages a cap and trade program for sulfur dioxide emissions under the Clean Air Act. A carbon dioxide cap and trade system, however, is a much larger scale proposal, and it is as much a revenue program as it is pollution control or regulatory policy.

Any federal effort to change the U.S. energy posture will have to assign high priority to identifying and promulgating quality and consistent information about global climate change, a priority President-Elect Obama mentioned on the campaign trail. Reliable, consistent information on climate change is hard to come by for federal agencies, particularly those that have to plan for how to deal with future climate-related contingencies (such as the Department of Defense and FEMA), given that 13 different agencies or offices have some jurisdiction over climate change issues. Moreover, public attitudes on climate change are going to be critical to national transformation, and despite the hard work of a committed core of government personnel, the federal government’s ability to conduct education and outreach on these issues is ad hoc at best and anemic in general.