Mr. REICHER. In fact, the biggest markets, Mr. Costello, are overseas. The greatest growth here in the U.S. for electricity generation is in the natural gas technologies. The market for the coal-based technologies are in fact overseas.

But, again, they will compete on a cost basis and equally on an environmental basis with technologies like gas, wind, biomass. There is a real technology race going on across the globe for this multitrillion dollar market.

Mr. COSTELLO. I have other questions, but I've run out of time and I'll be back in just a few minutes.

RENEWABLE ENERGY (NON-HYDROELECTRIC) COSTS AND DEMAND

Chairman CALVERT. Mr. Reicher, you say in your testimony that your office has a goal of tripling the non-hydroelectric renewable energy generating capacity to 25,000 megawatts of installed capacity by 2010, isn't that correct?

Mr. REICHER. Correct.

Chairman CALVERT. What exactly will be tripled? The biomass, geothermal, solar? And, what will be the cost, and how do we get there from here in such a short period of time?

Mr. REICHER. First of all, Mr. Chairman, the technologies are specifically solar, wind, geothermal and biomass. Those four are what we're talking about. How we get there is a combination of further reducing the costs of the technology. I talked about, in my opening statement, how wind power today is one-tenth of what it was 20 years ago. We can bring that down another 30 or 40 percent through a research program over just the next few years. And, then it would be fully competitive with other electricity technology.

So, bringing down that cost is number one. And, number two, getting the market acquainted with these technologies-they are like any technology not readily evident to people in the power business so you've actually got to go in, work with the private sector, demonstrate that these work and go from there. And, all over the country, we are essentially trying to do that with these various technologies.

I would note that we do have a complementary goal of maintaining the hydropower base in the United States. And, we have asked for funding in this budget, substantial funding in this budget for hydropower related work. Because that, obviously, today is the largest renewable power source in this country. And, we want to be sure that it remains a piece of the energy mix.

MAINTAINING HYDROELECTRIC DAMS' SHARE OF ELECTRICITY SUPPLY

Chairman CALVERT. That's interesting, Dr. Reicher, maintain the viability of hydropower as an important energy source, and I agree with you. It appears, though, that some of your fellow agencies, specifically the Department of Interior, is intent on reducing hydropower production while another, FERC, has a incredible relicensing process that's slowing hydropower licensing renewals.

What is DOE doing to overcome those opposing forces within your own administration?

Mr. REICHER. The primary, or one of the major concerns that a variety of people have with hydropower dams is the impact on fish, both the fish themselves and the aquatic environment for fish. And,

where we're spending time is looking at new kinds of turbines that can go into existing dams as they are relicensed that could radically decrease fish mortality. If we can achieve that, the relicensing process that the Federal Energy Regulatory Commission oversees will be a lot easier for the owners of dams across the United States. Meanwhile, I would have to say that FERC is working with industry, with the environmental community, and with other agencies, I should add, to improve the relicensing process. We're looking at relicensing literally hundreds and hundreds of dams in this country over the next decade or so. So it is important that we have a good process for doing it.

Chairman CALVERT. Well, I think industry would be surprised to hear that FERC is working with them. Because I've talked to many of the folks involved in hydroelectric power, and they find this process amazing.

Mr. REICHER. I understand the concerns. There is an advisory committee that's been formed to look at this. But I do understand their concerns.

COST TO REPLACE FOSSIL AND NUCLEAR ENERGY WITH RENEWABLE

ENERGY

Chairman CALVERT. Mr. Reicher, the Administration's climate policy and restructuring proposals appear to rely heavily for success on replacing coal and nuclear power with solar and renewables and natural gas in the electric generation industry. Has DOE analyzed the actual cost of replacing coal and nuclear with these technologies, taking into consideration the cost associated with siting, NEPA analysis, construction, permitting requirements and analyzed costs. And, if so, what are the results, and if not, why haven't you began such an analysis?

Mr. REICHER. Mr. Chairman, first of all, the Administration's approach is in fact, primarily to let market forces determine the energy mix of the next couple of decades. The restructuring legislation, I assume you mean the electricity restructuring proposal that we've made, is in fact designed to increase competition in the electricity markets, and allow market forces to determine the ultimate mix.

KYOTO PROTOCAL'S BINDING TARGETS' AND TIMETABLES' IMPACT ON FOSSIL ENERGY

Chairman CALVERT. Well, if I could, Mr. Reicher, when we were talking about Kyoto, and I was there, and many of us were, and everything I heard in Kyoto is the elimination of the coal industry, or the removal of the coal industry, because of the problems associated with global climate change. And, so, are you saying now that that's not going to be, that market forces alone are going to take over, or that the Kyoto agreement is not going to affect whether or not coal will be a viable energy source in the future?

Mr. REICHER. Well, first of all, referring back to an earlier question, the 3X goal we have for renewables, that would take us to 25,000 megawatts. But, that's still a relatively small percentage of the power base in this country. And, as I discussed with Mr. Costello, we have some serious programs related to coal, related to

nuclear, to put them on a level playing field with other technologies. And, what will in fact be more market based decisions.

Chairman CALVERT. So, you're saying that the Kyoto agreement is compatible with the market force and that the coal industry will be able to survive based upon the agreements that were made in Kyoto? Obviously, it's not going to survive in the Senate. But, from a practical point of view, I mean, do you believe that folks in the Administration, in effect, are saying that they agree to Kyoto, but they're going to go ahead and agree to continued coal use, which, in effect, flies in the face of what everybody in this Administration agreed to in Kyoto.

Mr. REICHER. If binding targets and timetables were ultimately adopted worldwide, with respect to climate change, it would no doubt have impacts on a variety of energy sources, coal included. The hope with coal, the hope with other fossil fuels, including natural gas, is that, in fact, we will put into place far cleaner, far more efficient technologies for coal, for natural gas, other technologies, including nuclear, that will in fact

Chairman CALVERT. You mean you've figured out a way to take CO2 out of the use of coal?

Mr. REICHER. That's in fact part of number one, the research work on improved efficiency and number two, the research work on carbon sequestration. That is, in fact, directly the reason that carbon sequestration research is important, and that is to deal with the CO2 that comes from coal and other fossil fuels, literally to sequester it in geologic structures, have it taken up by plants. All of these things fit together, the R&D on the technologies to improve their efficiency, the research and development on sequestration, to ultimately deal with the emissions of CO2, even from a highly efficient coal plant.

Chairman CALVERT. Well, that sounds great. I'll let a gentleman from a coal production area ask the next series of questions, well, Mr. Baca's here, excuse me. Mr. Baca, go ahead.

LOW INCOME HEATING ASSISTANCE PROGRAM

Mr. BACA. Thank you, Mr. Chairman.

Mr. Reicher, a question that I have, you mentioned increased funding for weatherization and State energy assistance grants programs in your testimony. Citizens in my State rely on assistance for heating through Low Income Heating Assistance Program. And, it would seem that the program helps us to expand benefits we provide through LIHEAP. Does energy assistance grants programs address the apartment building, or is it directed only to single family housing?

Mr. REICHER. It is directed, as well, at multifamily units, Mr. Baca. And, what I would say is, the LIHEAP program, the oil assistance funding, works extremely well with the weatherization funding, which is focused on improving the energy efficiency in people's homes. Because the more efficient home you can produce, the further you can take every dollar of oil heating assistance money. And instead of spending it in a given year in an inefficient house, it can return dividends over many years in a more efficient house. So number one, we work on both single family and multifamily homes. Number two, the DOE weatherization program and the

HHS LIHEAP, the Low Income Heating Assistance Program, work complementarily.

EPA'S SUPPORT FOR STATE AND LOCAL EFFORTS

Mr. BACA. Okay, thanks. I have one other question. This one's for Mr. Stolpman. What work is EPA currently doing to support regional, State and local efforts to combine transportation, economic development and air quality planning efforts?

Mr. STOLPMAN. I think we all are coming to realize the difficulties we face with congestion, the resulting air pollution, etc. And, part of our request for an increase in fiscal year 2001 would be to allow us to work more actively with our State partners and with their air pollution offices and their energy programs and their transportation programs to design the kinds of support tools that allow them to create programs which would address these issues that cut across both, as I said, the air pollution and the energy

area.

So, we would look forward to being able to work with our State partners, especially in the transportation area, to help develop these kinds of programs. About one-third of air pollution comes from the transportation sector. So, if we're going to deal with our air pollution problems, we're going to have to be able to deal with those issues. And, if we're going to deal with the liveability concerns and the sustainability concerns, those are the kinds of programs that we've got to put together.

And, that's part of our proposal for fiscal year 2001, is to be able to put those programs in place, to be able to give States that take action in the transportation area the kind of credit that they deserve and earn in terms of putting together their plans for meeting the ambient air quality standards as well. So, all of those things fit together as a whole, and we look forward to carrying out those kinds of programs.

Mr. BACA. I hope so, because in the Inland Empire we've had a lot of growth, and continue to have that growth because of the affordable homes, which means, then, that we need a lot more help in terms of transportation and air quality in the immediate area. Because we get the blunt of everything that comes from the mountain, hits the San Gabriel Mountains and then comes into San Bernadino and Riverside area. And, that's been impacted an awful lot. So, that's an area that I hope the assistance is provided there as we see the need for transportation and growth in the immediate

area.

EPA'S COORDINATION WITH DEPARTMENT OF TRANSPORTATION AT STATE AND LOCAL LEVEL

The other question that I have is, local communities need user friendly planning tools to evaluate these combined factors. They do not appear to be available at this time. Is the agency working with the Department of Transportation to develop some of these tools? Mr. STOLPMAN. Yes. We have an active program with the Department of Transportation to develop those kinds of tools. EPA's program in the transportation area is a combination of two things. We're working on the technology solutions on the one hand, with our PNGV contribution, and others in that area.

And, we're working with our partners at the State and local, and with the Department of Transportation to assist on the transportation side. You can reduce the emissions out of the tailpipe, but you also have to be able to deal with the way we move those vehicles around and the air pollution that's caused by that.

So, those are the dual emphases that we have in our programs, and especially in the transportation efficiency area, we work very closely with the Department of Transportation.

Mr. BACA. And, one of the other things, as you're quite aware, is that we have the trucking industry, which is the hub there in the Inland Empire. And, we continue to have more and more trucking industries that move into that area, and that needs to be addressed there as well. I know that the Chair is very much concerned there, as well as I, since we both represent the Inland Empire. And, I'm going to be mentioning the Inland Empire, as well as the rest of the State, as long as I'm on this Committee. Chairman CALVERT. Thank you, Mr. Baca.

Mr. Costello.

VOLUNTARY ENERGY REDUCTION PROGRAM: STATUS AND SUCCESS

Mr. COSTELLO. Mr. Stolpman, you indicated in your testimony, and I have a list of a number of companies, both from my State and other States, that participate in EPA's Voluntary Energy Reduction Program. One, what is the motivation or incentive of these companies to participate? And, two, can you give me a couple of examples of the types of things that companies have done through, in this program, your agency, or with the agency?

Mr. STOLPMAN. Actually, the motivations are really multiple. It would be easiest to say that the biggest motivation is the bottom line. The investments that companies and schools, etc., make in energy efficiency actually is extremely profitable. They earn cost savings that dramatically exceed the investments that they put forward. Certainly that's one motivation.

Doing the right thing for the environment is clearly another motivation. Improving the quality of their lighting or space, I'll give you an example. I toured the Boeing facility. Their big hangars, where they construct the 737s, they changed out all the lighting, improved the productivity of their workers, and returned on their investment within a single year. So the bottom line, improved productivity, improved competitiveness, doing the right thing for the environment, all of those are motivations.

Mr. COSTELLO. And, what types of things is the agency doing to promote and to make businesses aware that this program exists and that they in fact can participate?

Mr. STOLPMAN. A big part of our program is outreach. There are market barriers here. The Government's role in this case is to break down those market barriers to get the information out there. It's unbelievable that these kinds of returns on investments, people don't know about them, corporations don't know about them. So, a big part of our effort is to work with our partners, get the word out on these technologies, make sure that it's quality data that's going to them, provide the software and the other support activities that they need.