Department of Defense Energy Initiatives:
Background and Issues for Congress

Moshe Schwartz
Specialist in Defense Acquisition
Katherine Blakeley
Research Associate
Ronald O'Rourke
Specialist in Naval Affairs
July 20, 2012
Congressional Research Service
7-5700
www.crs.gov
R42558
CRS Report for Congress
Pr
epared for Members and Committees of Congress

Department of Defense Energy Initiatives: Background and Issues for Congress

Summary
The Department of Defense (DOD) spends billions of dollars per year on fuel, and is pursuing
numerous initiatives for reducing its fuel needs and changing the mix of energy sources that it
uses. DOD’s energy initiatives pose several potential oversight issues for Congress, and have
been topics of discussion and debate at hearings on DOD’s proposed FY2013 budget.
By some accounts, DOD is the largest organizational user of petroleum in the world. Even so,
DOD’s share of total U.S. energy consumption is fairly small. DOD is by far the largest U.S.
government user of energy. The amount of money that DOD spends on petroleum-based fuels is
large in absolute terms, but relatively small as a percentage of DOD’s overall budget. DOD’s fuel
costs have increased substantially over the last decade, to about $17 billion in FY2011.
Petroleum-based liquid fuels are by far DOD’s largest source of energy, accounting for
approximately two-thirds of DOD energy consumption. When DOD’s fuel use is divided by
service, the Air Force is the largest user; when divided by platform type, aircraft are the largest
user.
According to DOD, currently about 75% of DOD’s energy use is operational energy and about
25% is installation energy. Operational energy is defined in law as “the energy required for
training, moving, and sustaining military forces and weapons platforms for military operations.”
Installation energy is not defined in law, but in practice refers to energy used at installations,
including non-tactical vehicles, that does not fall under the definition of operational energy.
DOD’s reliance on fuel can lead to financial, operational, and strategic challenges and risks.
Financial challenges and risks relate to the possibility of a longer-term trend of increasing costs
for fuel, and to shorter-term volatility in fuel prices. Operational challenges and risks relate to: (1)
the diversion of resources to the task of moving fuel to the battlefield; (2) the negative impact of
fuel requirements on the mobility of U.S. forces and the combat effectiveness of U.S. equipment,
and (3) the vulnerability of fuel supply lines to disruption. Strategic challenges and risks relate to
getting fuel to the overseas operating area, and ensuring the global free flow of oil.
As part of its FY2013 budget submission, DOD has requested more than $1.4 billion for
operational energy initiatives in FY2013. DOD’s office of Operational Energy Plans and
Programs, headed by the Assistant Secretary of Defense, Operational Energy Plans and Programs
(ASD (OEPP)), is responsible for developing DOD policy for operational energy and alternative
fuels, and for coordinating operational energy efforts across the services.
Congress has been concerned with energy policy since the 1970s, and has passed legislation
relating to federal government energy use, including DOD installation energy use. Congress has
set specific energy-reduction targets for DOD installation energy, but not for operational energy.
Potential oversight issues for Congress regarding DOD’s energy initiatives include:
• DOD’s coordination of operational energy initiatives being pursued by the
military services.
• DOD’s efforts to gather reliable data and develop metrics for evaluating DOD’s
energy initiatives.
• DOD’s estimates of future fuel costs.
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Department of Defense Energy Initiatives: Background and Issues for Congress

• DOD’s role in federal energy initiatives.
• The Navy’s initiative to help jumpstart a domestic advanced biofuels industry.
• The potential implications for DOD energy initiatives of shifts in U.S. military
strategy.

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Department of Defense Energy Initiatives: Background and Issues for Congress

Contents
Introduction...................................................................................................................................... 1
Background...................................................................................................................................... 1
DOD’s Use of Fuels................................................................................................................... 1
In General............................................................................................................................ 1
The Services ........................................................................................................................ 3
Operational Energy vs. Installation Energy......................................................................... 4
How DOD Buys Fuels............................................................................................................... 5
Defense Logistics Agency-Energy (DLA-E)....................................................................... 5
Fully Burdened Cost of Fuel ............................................................................................... 6
Contractor Fuel Costs.......................................................................................................... 7
Challenges and Risks Associated with DOD’s Use of Fuels..................................................... 7
Financial.............................................................................................................................. 8
Operational........................................................................................................................ 10
Strategic............................................................................................................................. 12
DOD’s Energy Initiatives ........................................................................................................ 14
DOD Office of Operational Energy Plans and Programs.................................................. 15
Air Force ........................................................................................................................... 16
Navy .................................................................................................................................. 17
Marine Corps..................................................................................................................... 20
Army ................................................................................................................................. 21
Past Legislation on DOD Energy Use ..................................................................................... 22
Installation Energy ............................................................................................................ 22
Operational Energy ........................................................................................................... 23
Annual DOD Reports Relating to DOD Energy Use ........................................................ 24
Issues for Congress ........................................................................................................................ 25
DOD Coordination of Service Operational Energy Initiatives................................................ 25
Data and Metrics for Evaluating DOD’s Initiatives ................................................................ 26
DOD Estimate of Future Fuel Costs........................................................................................ 26
DOD Role in Federal Energy Initiatives ................................................................................. 27
Navy Role in Developing Advanced Biofuels......................................................................... 28
Implications of Changes in Strategy........................................................................................ 30
Legislative Action for FY2013 ...................................................................................................... 31
FY2013 National Defense Authorization Act (H.R. 4310/S. 3254) ........................................ 31
House................................................................................................................................. 31
Senate ................................................................................................................................ 40
FY2013 Department of Defense Appropriations Act (H.R. 5856) .......................................... 43
House................................................................................................................................. 43
FY2013 Military Construction, Veterans Affairs, and Related Agencies
Appropriations Act (H.R. 5854/S. 3215).............................................................................. 44
House................................................................................................................................. 44
Senate ................................................................................................................................ 46

Figures
Figure 1. DOD Petroleum Use by Service....................................................................................... 3
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Figure 2. DOD Petroleum Spending and Consumption................................................................... 8
Figure A-1. DOD Budget Outlay Deflation Factors, FY1970 - FY2017....................................... 49
Figure B-1. DLA-E Fuel Price Per Barrel ..................................................................................... 50

Tables
Table 1. Major ASD(OEPP) Operational Energy Initiatives ......................................................... 15
Table 2. Major Air Force Operational Energy Initiatives .............................................................. 17
Table 3. Major Navy Operational Energy Initiatives..................................................................... 19
Table 4. Major Marine Corps Operational Energy Initiatives........................................................ 20
Table 5. Major Army Operational Energy Initiatives .................................................................... 22
Table D-1. One-Time Reports on DOD Energy-Related Issues .................................................... 52

Appendixes
Appendix A. DOD Budget Deflation Factors................................................................................ 49
Appendix B. DLA-E Price Adjustments........................................................................................ 50
Appendix C. Fuel Use in Afghanistan ........................................................................................... 51
Appendix D. One-Time Reports on DOD Energy-Related Issues................................................. 52
Appendix E. Expanded Review of Past Legislation from 2005 Through FY2012........................ 53

Contacts
Author Contact Information........................................................................................................... 64

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Introduction
This report provides background information and identifies issues for Congress on Department of
Defense (DOD) energy initiatives. DOD spends billions of dollars per year on fuel, and is
pursuing numerous initiatives for reducing its fuel needs and changing the mix of energy sources
that it uses. DOD’s energy initiatives pose several potential policy and oversight issues for
Congress, and have been topics of discussion and debate at hearings on DOD’s proposed FY2013
budget. Congress’ decisions on DOD energy initiatives could substantially affect DOD
capabilities, funding requirements, and U.S. energy industries.
This report supplements earlier CRS reports on DOD fuel use and conservation.1 Another CRS
report discusses DOD’s facilities energy conservation policies.2
This report focuses primarily on DOD’s use of liquid fuels. It does not discuss in detail DOD’s
use of other energy, such as natural gas or electrical power, or the use of nuclear power by some
Navy ships.3
Background
DOD’s Use of Fuels
In General
From fueling jets, ships, and tactical vehicles to powering domestic installations and forward
operating bases, DOD consumes large amounts of energy to conduct its various operations. Points
that help describe DOD’s use of energy include the following:
DOD is by some accounts the largest organizational user of petroleum in
the world.4 DOD consumed about 117 million barrels of oil in FY2011.5
Even so, DOD’s share of total U.S. energy consumption is fairly small.
DOD’s use of energy in FY2010 accounted for almost 1% of all U.S. energy
consumption,6 DOD’s use of petroleum in FY2010 accounted for about 1.9% of
U.S. petroleum use.7

1 See, CRS Report R40459, Department of Defense Fuel Spending, Supply, Acquisition, and Policy, by Anthony
Andrews; and CRS Report RL34062, The Department of Defense: Reducing Its Reliance on Fossil-Based Aviation
Fuel—Issues for Congress
, by Kristine E. Blackwell.
2 CRS Report R40111, Department of Defense Facilities Energy Conservation Policies and Spending, by Anthony
Andrews.
3 For a report discussing the use of nuclear power by certain Navy ships, see CRS Report RL33946, Navy Nuclear-
Powered Surface Ships: Background, Issues, and Options for Congress
, by Ronald O'Rourke.
4 See Jerry Warner and Peter Singer, Fueling the “Balance”: A Defense Energy Strategy Primer, 2008; Bryan Walsh,
“Blue Water, Green Fleet,” Time, July 19, 2011.
5 Data provided by the Defense Logistics Agency–Energy (DLA-E).
6 CRS analysis of data from the U.S. Energy Information Administration, Annual Energy Review, October 19, 2011. In
(continued...)
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DOD is by far the largest U.S. government user of energy. DOD’s use of
energy in FY2010 accounted for about 80% of the federal government’s use of
energy.8
The amount of money that DOD spends on petroleum-based fuels is large
in absolute terms, but relatively small as a percentage of DOD’s overall
budget.
In FY2011, DOD spent about $17.3 billion on petroleum-based fuels,
accounting for about 2.5% of DOD’s total outlays in FY2011 and about 6% of
total operations and maintenance outlays in FY2011.9
DOD’s petroleum costs have increased substantially over the last seven
years even as DOD petroleum use has declined slightly over the same
period.
Between FY2005 and FY2011, DOD’s petroleum use decreased 4%.
Over the same period, DOD spending on petroleum rose 381% in real (i.e.,
inflation-adjusted) terms, from $4.5 billion in FY2005 (in FY2011 dollars) to
about $17.3 billion in FY2011.10
Petroleum-based liquid fuels are by far DOD’s largest source of energy.
Petroleum use accounted for 71% of DOD energy use in FY2010. By
comparison, electricity accounted for 11%; natural gas 8%; nuclear power in
Navy ships 7%; coal 2%; and all other sources 1%.11
When divided by platform type, aircraft are DOD’s largest users of
petroleum. According to a 2006 Navy report, in 2003 aircraft accounted for
73% of DOD’s petroleum use, ground vehicles accounted for 15%, while ships
accounted for 8%. DOD installations accounted for 4%.12

(...continued)
FY2010, DOD used about 890 trillion Btu of energy, while the United States as a whole used about 98,000 trillion Btu
of energy.
7 CRS analysis of data from the U.S. Energy Information Administration, Annual Energy Review, October 19, 2011. In
FY2010, DOD used about 689 trillion Btu of petroleum, while the United States as a whole used about 36,000 trillion
Btu of petroleum.
8 Based on analysis by CRS. Total U.S. federal government energy use in FY2010 estimated at 1,100 trillion BTU, of
which DOD accounted for 890 trillion Btu. U.S. Energy Information Administration, Annual Energy Review, October
19, 2011. The next-largest federal energy user—the Postal Service—accounted for 4%.
9 Data provided by DLA-E, March 1, 2012, CRS calculations using budget figures from the Department of Defense,
National Defense Budget Estimates for FY2013, Table 1-5, “National Defense Outlays,” p. 10. Data on DOD fuel use
based on fuel purchased by DOD components from DLA-E. Because DLA-E purchases fuel in advance and sells fuel
to non-DOD customers, DLA-E fuel purchases may differ from actual fuel used by DOD in the same fiscal year.
10 Data provided by DLA-E, March 1, 2012. CRS calculations adjusting for using DOD fuel deflation factors in the
Department of Defense, National Defense Budget Estimates for FY2012, Table 5-9, “Department of Defense Deflators
– Outlays,” p. 62.
11 CRS analysis of data from the U.S. Energy Information Administration, Annual Energy Review, October 19, 2011
and nuclear ship energy data provided by the Navy, March 1, 2012.
12 A.M. Andrews, W. Bryzik, and R. Carlin, et al., Future Fuels, Naval Research Advisory Committee, April 2006, p.
19.
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The Services
When DOD’s fuel use is divided by service, the Air Force is the largest user, accounting for 53%
of total DOD’s fuel use, compared to 28% for the Department of the Navy (which includes the
Navy and Marine Corps), and 18% for the Army (see Figure 1).13
Figure 1. DOD Petroleum Use by Service
FY2011

Source: CRS analysis of data provided by DLA-E, March 16, 2012.
Air Force
Between 85% and 95% of the fuel used by the Air Force is aviation fuel.14 In FY2011, the Air
Force used nearly 62 million barrels of petroleum fuel, including about 58 million barrels of
aviation fuel. In FY2011, 64% of Air Force aviation fuel was used for mobility and logistics air
operations, 31% for combat air operations, and 3% for training operations.15 In FY2009, the Air
Force’s Air Mobility Command, which provides airlift and refueling services to joint forces,
consumed more than half of Air Force fuel use and a quarter of DOD total fuel use.16

13 Data provided by DLA-E, March 1, 2012.
14 Office of the Deputy Assistant Secretary of the Air Force for Energy. U.S. Air Force Energy Program. June 2011;
CRS analysis of Air Force data, March 6, 2012, and DLA-E data on overall Air Force Fuel purchases, March 1, 2012.
15 Air Force aviation fuel data, provided March 6, 2012. The remainder is used by other missions, such as special forces
and combat search and rescue.
16 Oliver Fritz Operational Energy Considerations, Directorate of Strategic Planning, Headquarters U.S. Air Force,
June 14, 2010, p. 15. http://e2s2.ndia.org/pastmeetings/2010/tracks/Documents/OperationalEnergySession/
(continued...)
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Navy and Marine Corps
The Department of the Navy is less dependent on petroleum than the Air Force and Army for
meeting its energy needs, in part because all of the Navy’s aircraft carriers and submarines are
nuclear-powered. In FY2010, the Department of the Navy met 59% of its overall energy needs
from petroleum, 22% from nuclear-powered ships, and 19% from electricity.17 Aircraft operations
account for 54% of the Navy’s use of petroleum fuels, ships account for 43%, and non-tactical
uses account for 3%.18 The Marine Corps accounted for about 4.7 million barrels of the 30
million barrels of petroleum used by the Department of the Navy in FY2010. About 90% of the
Marine Corps’ fuel use is operational fuel, with aircraft accounting for about 85% and ground
forces accounting for about 15% of operational fuel use.19
Army
The Army, despite being the service with the greatest number of personnel, consumes less fuel
than the Air Force or Navy. In FY2011, the Army used about 21 million barrels of petroleum
fuel.20 The Army does not operate large numbers of airplanes, which are fuel-intensive platforms,
and relies on the Air Force and the Military Sealift Command for transporting and sustaining
troops.
Operational Energy vs. Installation Energy
DOD’s energy use can be divided into two broad categories—operational energy and installation
energy. Section 2821(a) of the FY2012 National Defense Authorization Act (H.R. 1540/P.L. 112-
81 of December 31, 2011) defines operational energy as “the energy required for training,
moving, and sustaining military forces and weapons platforms for military operations. The term
includes energy used by tactical power systems and generators and weapons platforms.” The
definition is codified at 10 U.S.C. 2924. DOD’s use of operational energy can vary over time,
depending on the number, location, scale, and tempo of DOD’s military operations around the
world.
Installation energy is not defined in law, but in practice refers to energy used at installations,
including by non-tactical vehicles, that does not fall under the definition of operational energy.21
Installation energy is sometimes referred to as facilities energy.22

(...continued)
Operational%20Energy%20Considerations_Fritz_20100604_v4_for%20NDIA.pdf
17 Data provided by the Navy, March 6, 2012. Analysis by CRS. The “N” in the hull classification for U.S. aircraft
carriers and attack submarines denotes “nuclear.”
18 Data provided by the Navy, March 6, 2012. Analysis by CRS.
19 Data provided by the Navy and the Marine Corps, March 6, 2012. Analysis by CRS.
20 Data provided by the Army, March 1, 2012.
21 Office of the Deputy Undersecretary of Defense (Installations and Environment), Department of Defense Annual
Energy Management Report
, Fiscal Year 2010, July 2011, p. 9.
22 For example, the Department of Defense Annual Energy Management Report, Fiscal Year 2010 uses the term
facilities energy to refer to installation energy.
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Under the definition of operational energy in P.L. 112-81, energy used at an installation to train
military personnel is considered operational energy.
The distinction between what is operational or installation energy is not always clear. For
example, at a domestic base that serves as the home of remote drone operations, energy used at
the base for drone operations could be viewed as operational energy. DOD is working to develop
rules for allocating various activities to operational or installation energy.23
According to DOD, currently about 75% of DOD’s energy use is operational energy and
about 25% is installation energy.24 Officials state current DOD energy use reflects recent
operations in Afghanistan and Iraq: the split between operational and installation energy
would likely be much different during peacetime.25 About 80% of installation energy
used in FY2010 was electricity and natural gas, about 15% was fuel oil and coal, and the
remainder was renewable energy and other sources.26
Energy used to directly support ongoing expeditionary operations, including logistics support
throughout the supply chain, and in-theatre energy consumption, can be considered a subset of
operational energy. According to DOD officials, the military is more reliant on fuel during
expeditionary operations.
How DOD Buys Fuels
Defense Logistics Agency-Energy (DLA-E)
The Defense Logistics Agency (DLA) is DOD’s logistics support agency. DLA-Energy (DLA-E)
is the part of DLA that is responsible for acquiring, storing, distributing and selling energy,
including petroleum, natural gas, and coal.27 DLA-E buys petroleum from suppliers around the
world and resells it to customers within DOD, acting as a clearinghouse for filling DOD’s
petroleum needs.28 DLA-E stores and sells fuel at more than 600 fuel depots worldwide, and also
sells fuel to foreign governments and other federal agencies.
To reduce costs for transporting fuel, DLA-E generally purchases fuel from sources close to
where it is to be used.29 Fuel to support operations in Afghanistan, for example, is generally
purchased from sources within the Central Command (CENTCOM) area of responsibility, while
fuel to support operations in the Pacific is generally purchased from sources within the Pacific
Command.30

23 Source: Discussions with ASD(OEPP) and Army, Navy and Air Force officials, March 2012.
24 Assistant Secretary of Defense for Operational Energy Plans and Programs, Operational Energy Strategy, p. 3.
25 Email from Army officials to CRS, June 3, 2012.
26 Department of Defense, Annual Energy Management Report, FY2010, pp. 15-16.
27 For more information on DLA-E see http://www.desc.dla.mil/.
28 DLA-E fulfills more than 99% of DOD’s global petroleum needs.
29 Sharon Burke, Assistant Secretary of Defense for Operational Energy Plans and Programs, testified that, “we fuel
where we fight.” U.S. Congress, House Committee on Armed Services, Subcommittee on Readiness, What is the Price
of Battlefield Security: From Battlefields to Bases
, 112th Cong., 2nd sess., March 29, 2012.
30 Defense Logistics Agency-Energy, Fact Book Fiscal Year 2010, p. 18.
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DLA-E incurs varying costs for obtaining fuels at different locations around the world, depending
on regional fuel prices and logistic costs. Despite these differing costs, DLA-E establishes a
“global leveled set price” for each fuel type—a single price for a gallon of that fuel type,
regardless of where it is purchased. For example, DLA-E charges DOD customers the same price
for a gallon of JP-8 (military jet fuel) purchased in Northern Afghanistan, Japan, or Fort Benning,
Georgia. To calculate the global leveled set price, DLA-E averages the worldwide cost of fuel
purchased, and then adds an operating surcharge to cover its worldwide operating expenses (such
as expenses for storing and distributing fuel).31
Fully Burdened Cost of Fuel
Section 332(g) of the FY2009 Duncan Hunter National Defense Authorization Act (S. 3001/P.L.
110-417 of October 14, 2008) defines the fully burdened cost of fuel as “the commodity price for
fuel plus the total cost of all personnel and assets required to move and, when necessary, protect
the fuel from the point at which the fuel is received from the commercial supplier to the point of
use.”32
The price for fuel that DLA-E charges to DOD customers is less than the fully burdened cost of
fuel—it covers the commodity cost of fuel and DLA-E’s fuel handling and overhead costs, but it
does not cover costs associated with transporting, storing, or protecting fuel beyond the DLA-E
point of delivery.33 Calculating the fully burdened cost of fuel requires adding these other costs to
DLA-E’s set fuel price.
The fully burdened cost of fuel varies widely, depending on where and under what circumstances
fuel is used. The fully burdened cost of fuel that is used near a DLA-E delivery point in the
United States is generally close to the DLA-E set price. In contrast, in rare cases, the fully
burdened cost of fuel delivered by helicopter to a remote and isolated location can run into the
hundreds of dollars per gallon.34 Costs for supplying fuel during overseas contingency operations,
particularly costs for logistics and force protection, generally increase the fully burdened cost of
fuel. A DOD analysis concluded that the “hidden costs” associated with the fully burdened cost of
fuel have led DOD to “systematically undervalue the true cost of supplying fuel to its battlespace
forces.”35
A number of studies have attempted to calculate the fully burdened cost of fuel in Iraq and
Afghanistan. In 2010, the Marine Corps estimated the fully burdened cost of fuel in Afghanistan
at between $9 to $16 per gallon if delivered by land, and between $29 to $31 per gallon if
delivered by air. An Army study estimated the fully burdened cost of fuel in Iraq at $9 to $45 per

31 DLA-E, Face Sheet “Fuel Standard Pricing”, May 2011.
32 The provision is codified at 10 U.S.C. 2911.
33 Army Environmental Policy Institute, Sustain the Mission Project: Energy and Water Costing Methodology and
Decision Support Tool
, Final Technical Report, July 2008, p. 3.
34 Defense Science Board, More Capable Warfighting Through Reduced Fuel Burden, May 2001, pp. 14-20. The
widely-repeated $400 per gallon figure represents a very specific scenario: a multi-stage helicopter resupply of forces
600km beyond secure supply lines. Costs for more common fuel delivery methods are significantly lower – the report
estimates that ground delivery over short distances would cost approximately $10 per gallon, while ground delivery
over longer distances would cost between $40-50 per gallon.
35 Defense Science Board, More Fight - Less Fuel, Report of the Defense Science Board on DoD Energy Strategy,
February 2008, p. 16.
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gallon, depending on the type of force protection used to and the delivery distance, while an Air
Force study estimated the fully burdened cost of fuel delivered by land at $3 to $5 per gallon and
$35 to $40 per gallon for aerial refueling.36 A 2008 report by the Army Environmental Policy
Institute estimated that the fully burdened cost of fuel for a Stryker brigade in Iraq ranged from
$14.13 to $17.44 per gallon.37
While the fully burdened cost of fuel illustrates the “hidden costs” of supplying fuel to forces in
the field, it is not a record of actual costs and is not used for budgeting purposes. Rather, it is
intended to be used in the acquisitions process as a factor in selecting new equipment, and to
illustrate potential systems’ logistical footprints. Section 332(c) of P.L. 110-417 states that “The
Secretary of Defense shall require that the life-cycle cost analysis for new capabilities include the
fully burdened cost of fuel during analysis of alternatives and evaluation of alternatives and
acquisition program design trades.” The provision is codified at 10 U.S.C. 2911 note.
Contractor Fuel Costs
The military relies on thousands of contractors to support military operations both domestically
and abroad.38 These contractors depend on fuel to perform many of their activities. The cost of
fuel used by contractors is often embedded in contracts and consequently not included in DOD’s
data on fuel. As a result, total DOD expenditures for fuel are higher than what is reflected in DOD
data.
Challenges and Risks Associated with DOD’s Use of Fuels
DOD’s reliance on fuel can lead to certain financial, operational, and strategic challenges and
risks. In recent years, rising fuel costs and operations in Iraq and Afghanistan have highlighted
some of these challenges and risks.39 DOD discusses these challenges and risks in some of its
strategic guidance documents,40 and takes them into account in its operational plans and in
developing its future force structure. This section focuses on challenges and risks associated with
DOD’s use of operational energy.41

36 DLA-E summarized the data from these three reports for CRS, June 2011.
37 Army Environmental Policy Institute, Sustain the Mission Project: Energy and Water Costing Methodology and
Decision Support Tool
, Final Technical Report, July 2008.
38 For example, in March 2011 there were over 174,000 DOD contractor personnel in the CENTCOM area of
responsibility, compared to approximately 214,000 uniformed personnel. (CRS Report R40764, Department of Defense
Contractors in Afghanistan and Iraq: Background and Analysis
, by Moshe Schwartz and Joyprada Swain.)
39 For some figures regarding fuel use in Afghanistan, see Appendix C.
40 See, for example, the 2012 Defense Strategic Guidance; 2012 Joint Operational Access Concept; 2012 Army-Marine
Corps Access Concept
; and 2012 National Military Strategy.
41 Since installation energy is largely electricity and natural gas, the risks of reliance on these sources, and possible
strategies to mitigate these risks, are very different. For a more detailed consideration of the risks of installations
energy, see Defense Science Board, More Fight - Less Fuel, Report of the Defense Science Board on DoD Energy
Strategy, “Chapter V: Managing Risks to Installations,” February 2008; Department of Defense Strategic Sustainability
Performance Plan, FY2010
, August 26, 2011.
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Financial
Financial challenges and risks associated with DOD’s reliance on fuel relate to the possibility of a
longer-term trend of increasing costs for fuel, and to shorter-term volatility in fuel prices. Each of
these is discussed below.
Possible Longer-Term Trend of Increasing Fuel Costs
DOD’s petroleum costs have increased substantially over the last seven years even as DOD
petroleum use has declined slightly over the same period. Between FY2005 and FY2011, DOD’s
petroleum use decreased 4%, from 122 million barrels to 117 million barrels (see Figure 2). Over
the same period, DOD spending on petroleum rose 381% in real (i.e., inflation-adjusted) terms,
from $4.5 billion in FY2005 (in FY2011 dollars) to about $17.3 billion in FY2011.42
Figure 2. DOD Petroleum Spending and Consumption

Source: Data provided by DLA-E, March 1, 2012. Fuel deflation factor from National Defense Budget Estimates
for FY2010, Office of the Undersecretary of Defense (Comptrol er), June 2009, Table 5-9, “Department of
Defense Deflators – Outlays for Pay and Purchases”, p. 47. Analysis by CRS.
A longer-term trend of increasing fuel costs could require DOD to devote an increasing share of
its budget to fuel, which in turn could make it more difficult for DOD to fund other priorities,
such as personnel pay and benefits or equipment acquisition programs. Since the early 1990s, the
cost of buying fuel has increased faster than any other major DOD budget category, including

42 Data provided by DLA-E, March 1, 2012. CRS calculations adjusting for using DOD fuel deflation factors in the
Department of Defense, National Defense Budget Estimates for FY2012, Table 5-9, “Department of Defense Deflators
– Outlays,” p. 62.
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health care and military personnel.43 Since FY2005, the share of DOD’s spending dedicated to
fuel increased from about 1.6% to about 2.5% of total spending.44 Although that change appears
small, in a DOD budget of roughly $700 billion per year, the increase of about 0.9% equates to
about $6 billion per year that otherwise might be available for funding other DOD priorities.
Some DLA-E officials and other analysts expect the price of oil to continue to rise as a result of
increasing demands for oil from developing countries.45 DOD projects that fuel costs will decline
13% from FY2013 to FY2014 and then remain roughly at that lower price through FY2017,
primarily because DOD projects the price of refined oil products to decline, even as it expects the
price of crude oil to remain relatively flat.46 Fuel appears to be the only category for which DOD
projects costs to decrease over the next four years (see Appendix A).47
Shorter-Term Volatility of Fuel Costs
Shorter-term volatility in fuel costs complicates DOD budgeting and can cause funding shortfalls
in the current-year budget. Because DOD fuel is funded primarily through DOD’s Operations and
Maintenance (O&M) account, unexpected increases in fuel prices can lead to significant O&M
funding shortfalls. In DOD’s FY2012 budget, for example, the cost of oil was forecast to be $130
per barrel, but oil prices in FY2012 rose to $156 per barrel, reportedly leading to an unfunded
obligation of more than $3 billion across DOD.48 Secretary of the Navy Ray Mabus stated in
April 2012 that the Navy is facing nearly a billion dollars in unfunded fuel costs,49 while U.S.
Pacific Command, to cite another example, is facing a $200 million shortfall in FY2012 O&M
funding due to higher-than-expected fuel costs.50
Even slight unexpected increases in costs for fuel can have a substantial effect on DOD’s current-
year budget. Navy officials state that a one-dollar increase in the price of a barrel of petroleum
costs the Navy alone about $30 million annually.51 (By extension, since DOD in FY2011 used
about 117 million barrels of oil, a one-dollar increase in the price of a barrel of petroleum would
cost DOD as a whole about $117 million.) A 10% increase from the FY2011 price of fuel would
cost DOD as a whole an additional $1.7 billion per year—the price of about 14 F-35s.52

43 National Defense Budget Estimates for FY2013, Office of the Undersecretary of Defense (Comptroller), March 2012,
Table 5-9, “Department of Defense Deflators – Outlays”, pp. 67-68. Calculation by CRS.
44 CRS analysis based on DOD budget authority figures in Department of Defense, National Defense Budget Estimates
for FY2013
. Data on DOD fuel spending provided by DLA-E, March 1, 2012.
45 U.S. Energy Information Administration, Annual Energy Outlook 2012 Early Release Report, p. 1., Discussion with
DLA-E, March 1, 2012. See also CRS Report R42024, Oil Price Fluctuations, by Mark Jickling.
46 Data from DOD Comptroller, May 1, 2012.
47 National Defense Budget Estimates for FY2013, Office of the Undersecretary of Defense (Comptroller), March 2012,
Table 5-9, “Department of Defense Deflators – Outlays”, pp. 67-68. Calculation by CRS.
48 Discussion with Navy officials, March 6, 2012; Speech given by Secretary of Defense Leon Panetta, May 2, 2012,
http://www.defense.gov/speeches/speech.aspx?speechid=1667.
49 Secretary of the Navy Ray Mabus, Remarks at the Sea Air Space Exposition, April 16, 2012.
50 Discussion with Navy officials, March 6, 2012.
51 Jo Decker, Assistant Deputy Chief of Naval Operations. “Energy and Total Ownership Cost.” October 13, 2011; Al
Shaffer, Defense Energy Security Briefing, Defense Energy Security Task Force, May 22, 2007, p. 9.
52 Analysis by CRS, using F-35 cost data provided by the Air Force, March 6, 2012.
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Responding to O&M funding shortfalls caused by unexpected increases in fuel costs can require
either submitting supplemental funding requests (such as the $5 billion supplemental funding
request to cover unexpectedly high fuel costs in FY2008), or reducing funding for other O&M-
funded activities.53 Then-Secretary of Defense Robert Gates testified in 2011 that unbudgeted fuel
costs could force cuts in Air Force flying hours, Navy steaming days, and training for home-
stationed Army troops.54
By some measures, petroleum prices have become increasingly volatile in recent years. DOD’s
petroleum costs, for example, increased by nearly 90% between FY2004 and FY2005, and then
declined by about 50% between FY2008 and FY2009.55 Volatility in prices prompted DLA-E in
FY2005 to shift from a practice of setting fuel prices once a year to adjusting prices as needed
within a given fiscal year (see Appendix B). Many analysts expect future oil prices to continue to
be volatile in coming years.56
Operational
Operational challenges and risks associated with DOD’s reliance on fuel relate to:
• the diversion of resources to the task of moving fuel to the battlefield;
• the negative impact of fuel requirements on the mobility of U.S. forces and the
combat effectiveness of U.S. equipment; and
• the vulnerability of fuel supply lines to disruption.
Diversion of Resources
Maintaining a logistics capability for an overseas military operation requires substantial personnel
and materiel resources. The logistic network for an overseas military operation can be so
extensive that reportedly as much as 1.4 gallons of petroleum fuel can be consumed to deliver 1
gallon to forces on the battlefield.57 The use of personnel and material for getting fuel to the
battlefield diverts resources that could otherwise be used for meeting other military requirements.
A 2008 DOD analysis found that moving and protecting fuel “add[s] to sustainment costs and
divert[s] and endanger[s] in-theatre force capability.”58 In addition, maintaining an extensive

53 DoD Energy Security Task Force, OUSD(AT&L), Department of Defense Report to Congress on Energy Security
Initiatives
, October 2008, p. 1.
54 U.S. Congress, Senate Committee on Armed Services, To receive testimony on the Defense Authorization Request for
Fiscal Year 2012 and the Future
, 112th Cong., 1st sess., February 17, 2011; in meetings with DOD energy officials,
Navy officials said that fuel price volatility “crushes us,” while Air Force officials said that the Air Force’s budget is
“heavily impacted by fluctuating fuel prices,” March 6, 2012. GAO noted that out-of-[budget]-cycle price increases are
hard for the services to absorb. U.S. Government Accountability Office, DOD Needs to Increase Attention on Fuel
Demand Management at Forward-Deployed Locations
, GAO-09-300, February 2009, p. 9.
55 Data from Defense Energy Support Center, FY2002-FY2010 Fact Books, analysis by CRS. Fuel deflation factor from
National Defense Budget Estimates for FY2010, Office of the Undersecretary of Defense (Comptroller), June 2009,
Table 5-5, “Department of Defense Deflators – TOA”, p. 43. Analysis by CRS.
56 Robert McNally and Michael Levi, “A Crude Predicament: The Era of Volatile Oil Prices,” Foreign Affairs,
July/August 2011, p. 105; CRS Report R42024, Oil Price Fluctuations, by Mark Jickling.
57 Amory B. Lovins, “DOD’s Energy Challenge as Strategic Opportunity,” Joint Forces Quarterly, Issue 57, 2nd
Quarter 2010, p. 37.
58 Defense Science Board, More Fight - Less Fuel, Report of the Defense Science Board on DoD Energy Strategy,
(continued...)
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logistic network can result in increased numbers of contractors on the battlefield. In Iraq and
Afghanistan, the extensive use of contractors has in some cases caused problems and undermined
U.S. efforts.59
Restraint on Mobility and System Effectiveness
Fuel requirements can slow down the rate at which U.S. forces can be deployed and assembled in
an overseas theater, can limit the rate of advance or the battlefield maneuverability of U.S. forces
engaged in combat operations, and can affect the weight, speed, range, and lethality of U.S.
weapon systems. A 2001 DOD study estimated that if the Abrams tanks used by the Army and
Marine Corps were 50% more fuel efficient, and consequently if a smaller amount of fuel for
those tanks needed to be moved to the battlefield, the build-up for Operation Desert Shield/Desert
Storm (i.e., the 1990-1991 U.S.-led military operation against Iraq) could have been completed in
about 5 months instead of 6 (i.e., about 15% more quickly).60 During the 2003 U.S. advance on
Baghdad, then-Major General James Mattis, commander of the 1st Marine Division, noted that
U.S. forces were outpacing their logistics support.61 General James Amos, Marine Corps
Commandant, stated in 2001 that fuel dependency “constrains our tactical options for executing
missions in complex battlespaces, across long distances, and against hybrid threats.”62
The 2011 National Military Strategy states that U.S. forces in the future must become more
“expeditionary in nature” and “require a smaller logistical footprint in part by reducing large fuel
and energy demands.”63
Vulnerability of Fuel Supply Lines
Fuel supply lines are vulnerable to disruption from enemy attack or from natural events—such as
poor weather, floods, or earthquakes—that can damage, destroy or limit the use of roads, ports,
and airfields. Protecting fuel-supply lines against enemy attack can lead to the assignment of
additional personnel and other resources to the task of moving fuel through the battlefield,
increasing the above-discussed diversion of resources away from other military requirements.
DOD stated in 2011 that “attacks on fuel convoys and fixed energy supplies in Afghanistan, Iraq,
and surrounding countries already demonstrate the vulnerability of our current supply
networks.”64 Secretary of the Navy Ray Mabus testified in 2011 that “Future adversaries [can]
target our operational dependence on petroleum, as we see in attacks on fuel convoys in
Afghanistan.”65

(...continued)
February 2008, p. 17.
59 See CRS Report R40835, The Department of Defense’s Use of Private Security Contractors in Afghanistan and Iraq:
Background, Analysis, and Options for Congress
, by Moshe Schwartz.
60 Defense Science Board, More Capable Warfighting Through Reduced Fuel Burden, May 2001, p. 13.
61 The full quote runs, “Unleash us from the tether of fuel.” General Mattis is currently CENTCOM commander.
62 USMC, United States Marine Corps Expeditionary Energy Strategy and Implementation Strategy: Bases to
Battlefield, “Commandant’s Message”, General James F. Amos, Commandant, U.S. Marine Corps, April 4, 2011, p. 3.
63 The Joint Chiefs of Staff, The National Military Strategy of the United States, February 2011, p. 18.
64 Department of Defense, Strategic Sustainability Performance Plan, FY2011, July 12, 2011, pp. 1-2.
65 U.S. Congress, Senate Committee on Appropriations, Subcommittee on Department of Defense, Hearing on FY 2012
(continued...)
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U.S. Transportation Command estimated that ground convoys in Afghanistan suffered more than
1,100 attacks in 2010, including attacks from improvised explosive devices.66 The Marine Corps
estimated in 2010 that there was one Marine casualty for each 50 Marine Corps fuel or water
convoys in Afghanistan,67 and an Army analysis of the period 2003-2007 that included both Army
and contractor personnel estimated one casualty per 24 fuel convoys in Afghanistan.68 The Marine
Corps estimates that about 10% of battlefield casualties in Iraq and Afghanistan are related to
convoy operations,69 while the Army estimated that 18% of casualties in Iraq and Afghanistan are
related to ground resupply operations.70 A 2009 study by the Army Environmental Policy Institute
reported that between 2003 and 2007, more than 3,000 U.S. troop and contractor deaths or
injuries were attributable to fuel supply convoys in Iraq and Afghanistan.71
Strategic
Strategic challenges and risks associated with DOD’s reliance on fuel relate to getting fuel to the
overseas operating area, and ensuring the global free flow of oil.
Getting Fuel to the Area of Operations
Supply lines supporting overseas missions may cross international borders, giving other countries
the ability to disrupt or otherwise influence the flow of supplies. Operations in Afghanistan
highlight challenges associated with operating a logistic network that is dependent on the assent
of other countries. Since Afghanistan is a landlocked country, fuel and supplies must run through
the territory or airspace of one or more neighboring countries. Vice Adm. Mark Harnitchek,
deputy commander of U.S. Transportation Command, reflecting on the task of keeping open U.S.
supply lines to Afghanistan, described the U.S. military operation in Afghanistan as “the logistics
challenge of our generation.”72

(...continued)
Budget for the Dept. of the Navy, 112th Cong., 1st sess., March 16, 2011.
66 Remarks by General Duncan McNabb, Commander, U.S. Transportation Command, CSIS, February 7, 2011.
http://csis.org/event/military-strategy-forum-general-duncan-mcnabb-commander-us-transportation-command
67 “Analysis of Logistics Related Casualties for Marine Forces in Afghanistan,” by the Current Operational Analysis
Support Team, Operations Analysis Division (OAD), Marine Corps Combat Development Command, Quantico VA,
September 2010, is referred to by the Marine Corps Expeditionary Energy Strategy and Implementation Strategy: Bases
to Battlefield”, April 4, 2011, p. 7.
68 Army Environmental Policy Institute, Sustain the Mission Project: Casualty Factors for Fuel and Water Re-supply,
Final Technical Report, September 2009, p. 2-6.
69 Presentation by Mike Boyd, HQMC Engineer Advocate Branch Head, “USMC Operational Energy Efforts and
Challenges,” p. 16.
70 MG Raymond Mason, Office of the Deputy Chief of Staff (Army), “Power and Energy: Enhancing Mission
Effectiveness while Preserving Future Choices,” October 11, 2011, p. 3, http://usarmy.vo.llnwd.net/e2/c/downloads/
223041.pdf.
71 Army Environmental Policy Institute, Sustain the Mission Project: Casualty Factors for Fuel and Water Resupply
Convoys
, Final Technical Report, September 2009, p. 3. Supply convoys transport water and other goods in addition to
fuel. This study calculated the casualties attributable to the fuel portion of supply convoys by multiplying the total
number of casualties associated with supply convoys by the percentage of the convoy load allocated to fuel: 50% in
Iraq and Afghanistan. While reducing fuel needs would reduce the overall number of convoys needed, the number of
associated casualties may not to scale linearly.
72 Tom Gjelten, “U.S. Now Relies On Alternate Afghan Supply Routes,” NPR, September 26, 2011.
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Until November 2011, routes running through Pakistan were the primary ones for bringing fuel
into Afghanistan, accounting for approximately 70% of fuel (and also 29% of supplies) delivered
to U.S. forces in Afghanistan.73 DLA-E officials attribute hijackings and theft of supplies being
transported along routes in Pakistan in part to Pakistan’s prohibition on using U.S. military or
private security contractors to protect convoys.74 Following a U.S. airstrike on November 26,
2011, that killed 24 Pakistani soldiers, Pakistan closed its supply routes to Afghanistan. This
closure forced DOD to shift to using the Northern Distribution Network, a longer, more costly,
and more complex logistics route stretching from Latvia or Azerbaijan across Russia, Kazakhstan,
Kyrgyzstan, Tajikistan and Uzbekistan. DLA-E is currently moving all fuel through these
northern routes.75 There have been allegations of corruption tied to DLA-E fuel contracts in
Kyrgyzstan, jeopardizing continued U.S. use of the Manas Transit Center, a key logistics hub.76
Using northern routes reportedly has increased DOD’s costs for transporting fuel and supplies to
Afghanistan to a reported $104 million per month—$87 million per month more than when routes
through Pakistan were used.77 Shipping a 20-foot cargo container to Afghanistan costs $10,000
more if transported on northern routes, according to the U.S. Transportation Command.78 In
addition to being more expensive, the northern route cannot be used to transport lethal cargo, can
only be used one way, and, according to DLA-E officials was operating at fully capacity in March
2012.79 Air Force General William M. Fraser III of the Air Force, Commander of U.S.
Transportation Command testified that both the northern and Pakistani routes are necessary to
support the U.S. drawdown in Afghanistan.80
Ensuring the Global Free Flow of Oil
Oil is critical to the U.S. economy. It is the United States’ largest source of energy, providing 37%
of the total energy the nation consumes and 94% of the energy used for transportation. Every U.S.
recession in the last 40 years has been preceded by an increase in oil prices.81 Any disruption in
the global free flow of oil could result in an increase in oil prices and pose a serious risk to the
U.S. and international economies.82 DOD officials state that protecting shipping lanes and the free

73 U.S. Congress, Senate Committee on Foreign Relations, Central Asia and the Transition in Afghanistan, A Majority
Staff Report, 112th Cong., 1st sess., December 19, 2011, pp. 5-6.
74 Interview with DLA-E officials, March 1, 2012.
75 Discussion with DLA-E officials, March 1, 2012.
76 Subcommittee on National Security and Foreign Affairs of the House Committee on Oversight and Government
Reform, “Mystery at Manas: Strategic Blind Spots in the Department of Defense’s Fuel Contracts in Kyrgyzstan,”
December 2010.
77 Lolita C. Baldor and Robert Burns, “Costs Soar for New War Supply Routes,” Associated Press, January 19, 2012.
78 U.S. Congress, Senate Committee on Foreign Relations, Central Asia and the Transition in Afghanistan, A Majority
Staff Report, 112th Cong., 1st sess., December 19, 2011, pp. 5-6.
79 Tom Gjelten, “U.S. Now Relies On Alternate Afghan Supply Routes,” NPR, September 26, 2011; Discussion with
DLA-E officials, March 1, 2012. According to information provided by DLA-E officials in May 2012, capacity along
the northern network is increasing.
80 U.S. Congress, Senate Committee on Armed Services, U.S. Pacific Command and U.S. Transportation Command
Budget Request for FY2013
, 112th Cong., 2nd sess., February 28, 2012.
81 See CRS Report R42024, Oil Price Fluctuations, by Mark Jickling, p. 3.
82 While a disruption in the flow of oil would not necessarily pose a risk a direct risk to DOD’s ability to operate, DOD
may be called upon to respond to such disruption.
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flow of oil is a fundamental mission of the U.S. Navy, and is vital to U.S. national and economic
interests.83
Global petroleum distribution networks pass through a number of “chokepoints” that are
vulnerable to disruption, including in particular the Strait of Hormuz leading into and out of the
Persian Gulf. Securing Persian Gulf shipping lanes, particularly through Straight of Hormuz, is
one of the primary missions of the Navy’s Fifth Fleet, headquartered in Bahrain. Although exact
figures are difficult to calculate (because many U.S. forces have multiple mission
responsibilities), observers believe that DOD spends billions or tens of billions of dollars annually
protecting global oil transit routes and chokepoints. A 2009 RAND report estimated the cost to
DOD of protecting the supply and transit of oil from the Persian Gulf at between $86 billion and
$104 billion per year—figures that equate to a substantial fraction of DOD’s total budget.84
DOD’s role in protecting the global free flow of oil can lead to U.S. combat operations, such as
those in the Persian Gulf against Iranian forces that occurred during Operation Earnest Will, the
1987-1988 U.S. military operation to protect oil tankers and other commercial ships operating in
the Persian Gulf from Iranian attack during the so-called Tanker War (i.e., the at-sea component
of the Iran-Iraq War of the 1980s). In December 2011, in response to threats by Iran to close the
Strait of Hormuz, Secretary of Defense Leon Panetta stated that a closure of the strait would be
considered a “redline” by the United States; a spokeswoman from the 5th Fleet similarly stated
that “any disruption will not be tolerated.”85
DOD’s Energy Initiatives
DOD is pursuing numerous initiatives for reducing its fuel needs and changing the mix of fuels
that it uses. Some of DOD’s energy initiatives respond to statutory requirements (see “Past
Legislation on DOD Energy Use” below). More generally, DOD justifies its energy initiative in
connection with reducing the challenges and risks associated with DOD’s reliance on fuel that are
discussed in the previous section of this report. Several DOD strategy documents discuss the need
to decrease logistic footprints and reduce energy demands.86 A 2008 DOD report states “the
payoff to DOD from reduced fuel demand in terms of mission effectiveness and human lives is
probably greater than for any other energy user in the world.”87

83 Meeting with Navy officials, March 6, 2012. The Navy mission statement includes “maintaining freedom of the
seas.” http://www.navy.mil/navydata/organization/org-top.asp.
84 Keith Crane, Andreas Goldthau, and Michael Toman, et al., Imported Oil and U.S. National Security, RAND, 2009.
Other estimates have ranged from $27 billion to $143 billion annually. See Adam J. Liska and Richard K. Perrin,
“Securing Foreign Oil: A Case for Including Military Operations in the Climate Change Impact of Fuels,” Environment
Magazine
, July/August 2010.
85 Thom Shanker, “Defense Chief Says Israel Must Mend Arab Ties,” The New York Times, December 2, 2011; Diane
Cardwell and Rick Gladstone, “Oil Prices Predicted to Stay Above $100 a Barrel Through Next Year,” The New York
Times
, December 28, 2011; Robert Johnson, “US Sends Aircraft Carrier Into The Strait Of Hormuz, As Iran Beats Its
Chest,” Business Insider, December 29, 2011. For further discussion, see CRS Report R42335, Iran’s Threat to the
Strait of Hormuz
, coordinated by Kenneth Katzman.
86 See 2012 Defense Strategic Guidance; 2012 Joint Operational Access Concept; 2012 Army-Marine Corps Access
Concept; and 2012 National Military Strategy.
87 Defense Science Board, More Fight - Less Fuel, Report of the Defense Science Board on DoD Energy Strategy,
February 2008, p. 18.
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As part of its FY2013 budget submission, DOD is requesting more than $1.4 billion for
operational energy initiatives in FY2013. Most of these initiatives are aimed at reducing the
amount of energy DOD needs to conduct operations. DOD’s five year (FY2013-FY2017) Future
Years Defense Plan (FYDP) includes a total of about $8.6 billion for operational energy
initiatives.88
DOD as a whole faces certain challenges in decreasing its reliance on fuel. One of these relates to
equipment service lives: aircraft and ships, which together account for more than half of DOD
fuel use, have long service lives, so the composition of the inventory of aircraft and ships tends to
change slowly over time. Another challenge relates to gathering reliable data on energy use for
developing clear metrics to evaluate the effectiveness of the initiatives, and making informed
decisions.89
The following sections summarize energy initiatives being pursued by DOD’s Office of
Operational Energy Plans and Programs (OEPP), and by each of the military services.
DOD Office of Operational Energy Plans and Programs
DOD’s office of Operational Energy Plans and Programs was established by statute as set forth in
the FY2009 Duncan Hunter National Defense Authorization Act (P.L. 110-417, as amended).90
The office is headed by the Assistant Secretary of Defense, Operational Energy Plans and
Programs (ASD(OEPP)), is responsible for developing DOD policy for operational energy and
alternative fuels, and for coordinating operational energy efforts across the services. OEPP states
that its efforts focus on promoting institutional change, supporting current operations, and
building energy awareness into the requirements of future systems.91 Table 1 lists what OEPP
describes as its major operational energy initiatives.
Table 1. Major ASD(OEPP) Operational Energy Initiatives
Initiative Description
Establish a baseline of DOD
Gather reliable DOD-wide data on operational energy consumption, to serve
operational energy consumption
as a foundation for analyzing DOD operational energy use and developing
operational energy metrics.
Defense Operational Energy Board
This board oversees the execution of the Operational Energy Implementation
Plan, including setting operational energy metrics.
Operational energy budget
Evaluate DOD budget allocations for operational energy to ensure that they
certification
are sufficient to support the operational energy strategy.
Operational energy partnerships
USFOR-A and CENTCOM have stood up operational energy groups, and
with CENTCOM and U.S. Forces–
USFOR-A has issued operational energy policy guidance.
Afghanistan (USFOR-A)

88 Testimony of Sharon Burke, Assistant Secretary of Defense, Operational Energy Plans and Programs, U.S. Congress,
House Committee on Armed Services, Subcommittee on Readiness, What is the Price of Energy Security: from
Battlefields to Bases
, 112th Cong., 2nd sess., March 29, 2012; Data from OEPP, April 2012.
89 Discussion with ASD(OEPP) officials, March 1, 2012.
90 See “DOD Office of Operational Energy Plans and Programs” for a discussion on the legislation establishing the
office.
91 Information provided by ASD(OEPP), April 2012.
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Initiative Description
Establish a baseline of DOD
Gather reliable DOD-wide data on operational energy consumption, to serve
operational energy consumption
as a foundation for analyzing DOD operational energy use and developing
operational energy metrics.
Defense Operational Energy Board
This board oversees the execution of the Operational Energy Implementation
Plan, including setting operational energy metrics.
Rapid fielding of equipment in
Efforts to streamline the deployment of equipment (such as more-efficient
theatre
generators) that reduces in-theatre fuel consumption,
Operational Energy Capability
$19.5 million fund to spur technology innovations that reduce energy load at
Improvement Fund
contingency bases, measure energy consumption in forward areas, and
transform waste into energy.
Energy Key Performance Parameter
Establish a methodology for an Energy Key Performance Parameter (KPP) to
be used in requirements gap analysis, requirements development, and
acquisition programs.
Fully burdened Cost of Fuel
Provide the services with non-binding guidance on the methodology and
application of Ful y Burdened Cost of Energy (FBCE) estimates as part of the
life-cycle cost analysis for new capabilities during the acquisitions process.
Energy in Procurement Contracts
Work with DOD’s office of Defense Procurement and Acquisition Policy to
develop template language on energy performance for DOD contracts.
Source: Information provided by ASD(OEPP), April 2012.
Air Force
Air Force officials state that the Air Force’s energy initiatives are aimed at reducing the service’s
energy costs (which accounted for 8.4% of the Air Force’s budget in FY2011) and at reducing the
budgetary impact of volatility in fuel prices.92 More specifically, the Air Force states that its
operational energy goals are the following:
• Reduce consumption of aviation fuel 10% by 2015.
• Be prepared to acquire 50% of the Air Force’s domestic aviation fuel
requirement via an alternative fuel blend by 2016.
• Test and certify all aircraft and systems on a 50:50 alternative fuel blend93 by
2012.94
The Air Force’s FY2013 budget submission requests $655 million for operational energy
initiatives in FY2013, and programs a total of about $2.6 billion for energy initiatives across the
FYDP. Table 2 lists what the Air Force describes as its major operational energy initiatives.

92 Data provided by the Air Force, March 2012.
93 A 50:50 alternative fuel blend is fuel that consists of 50% conventional (i.e., petroleum-based) fuel and 50%
alternative (i.e., non-petroleum-based) fuel.
94 U.S. Air Force Briefing, “Air Force Energy Consumption,” March 6, 2012. The original target date for completing
testing and certifying had been 2011. U.S. Air Force, “Air Force Energy Plan 2010,” December 9, 2009, p. 8.
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Table 2. Major Air Force Operational Energy Initiatives
Initiative Description
Goals
Funding (millions)
FY2012 FY2013 FYDP
(requested)
(FY13-
FY17)
Adaptive
Next-generation turbine 25% greater fuel efficiency,
$58 $48 $48a
Versatile Engine
engine, optimizing
increased strike radius,
Technology
combat aircraft engine
fewer tanker sorties.
(ADVENT)
fuel efficiency and
performance at all flight
conditions.
Adaptive Engine
Follow-on to ADVENT
25% greater fuel efficiency,
$0b
$213.6 $346.4
Technology
engine development of
increased strike radius,
Development
next-generation turbine
fewer tanker sorties.
[$68]
(AETD)
engine

Highly Efficient
Develop advanced
35% greater fuel efficiency,
$15.8 $8.8 $237.3
Embedded
engine technologies for
increased payload, range.
Turbine Engine
tanker, ISR, and strike
(HEETE)
aircraft.
Alternative
Certify Air Force Fleet
Diversify potential fuel
$0
$0 $0
Aviation Fuels
on Fischer-Tropsch,
supplies.
Certification
biojet, and alcohol-to-
[$24.1 in
jet blends.
FY2011]
KC-135
4th generation engine
Reduce fuel consumption
$0 $29
$159
Propulsion
upgrades to high
by 1.5%, improved
Upgrade
pressure components
reliability and durability;
achieve lifetime fuel and
maintenance savings of
more than $1.3 billion.
KC-10 Drag
Corrects aircraft drag
Reduce fuel consumption
$0 $2.1
$28.1
Reduction
problems
by 1.4%, saving $5.4
million per year.
Policy Changes
Improved aircraft
Reduce FY2013 aviation
$0 $0 $0
routing, more precise
needs by 55 million
fuel and cargo loading,
gallons, saving
etc.
$208.1million.
Source: Data provided by the Air Force March 2012, drawing on the FY2013 Air Force Energy Program
Overview and FY2013 Budget material. ISR is intelligence, surveillance, and reconnaissance.
Notes:
a. AETD is the follow-on program to ADVENT, which is terminating in FY2012.
b. The Air Force’s FY2012 budget justification material does not provide funding for AETD in FY2012. The
FY2013 budget justification material states that in FY2012 AETD required $68 million over the baseline
FY2012 funding.
Navy
The Department of the Navy has identified six major objectives for FY2013, of which the third is
to
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Lead the Nation in Sustainable Energy. The Navy and Marine Corps are pioneering DoD’s
efforts to reduce energy consumption. Our investments in alternative fuels/biofuels have led
to success in both aircraft and ships supporting our path to a green fleet. Our hybrid-drive
system has already produced fuel savings on the [amphibious assault ship] USS Makin
Island (LHD 8). Energy saving efforts have also drastically cut energy usage on bases, with
new solar and geothermal technologies providing electricity. As the use of alternative energy
increases across the Department, DON will be protecting the environment with clean energy
and lessening our dependence on foreign oil.95
Secretary of the Navy Ray Mabus testified on February 16, 2012 that “we would be irresponsible
if we did not reduce our dependence on foreign oil.”96 Secretary Mabus stated in April 2012 that
the Navy’s biofuel efforts will increase the security of the Navy’s energy supply and reduce the
service’s vulnerability to price shocks.97
Accordingly, the Navy’s operational energy initiatives focus on reducing the service’s energy
consumption and its reliance on fossil fuels. The Navy’s operational energy goals are to:
• Require consideration of life-cycle energy costs as a factor in developing and
awarding contracts for systems and buildings.
• Demonstrate a “Green Strike Group” of ships and aircraft powered by biofuels
by 2012, and deploy it overseas by 2016.
• Ensure that at least 50% of the Navy’s total energy consumption is from
alternative sources by 2020.
• Increase energy efficiency and/or reduce fuel consumption afloat by 15% by
2020.98
The Navy’s FY2013 budget submission requests $338 million for operational energy initiatives in
FY2013, and programs a total of about $1.9 billion for operational energy initiatives across the
FYDP. Of the $338 million requested for FY2013, $186.3 million is for maritime energy (i.e.,
ships), $121.3 million is for aviation energy, $13.4 million is for expeditionary energy, and $17.1
million is for alternative fuels procurement and testing.
One of the most controversial of DOD’s energy initiatives is the Navy’s proposal to invest $170
million over the next several years to jumpstart a domestic advanced biofuels industry, using
authority provided by the Defense Production Act. An August 2011 MOU between the Navy, and
the Departments of Agriculture and Energy formalizes this intention. Each agency has pledged up
to $170 million with substantial cost-sharing from industry, to construct or retrofit commercial
scale (at least 10 million gallons) advanced drop-in biofuel plants and refineries.99 The Navy’s

95 Department of the Navy, Highlights of the Department of the Navy FY 2013 Budget, February 2012, p. 1-8. The other
five objectives listed are “take care of our people,” “maintain warfighter readiness,” “promote acquisition excellence
and integrity,” “dominate in unmanned systems,” “drive innovative enterprise transformation.” The Department of the
Navy states, in presenting the list, that “Our objectives are aligned with new strategic guidance for DoD and will
provide real benefit to the nation in the fulfillment of our responsibilities to maintain a capable Navy and Marine
Corps.... Each of these objectives will allow us to meet our mission of being a highly effective and efficient force.
(Department of the Navy, Highlights of the Department of the Navy FY 2013 Budget, February 2012, pp. 1-7 to 1-9.)
96 U.S. Congress, House Committee on Armed Services, FY2013 Budget Request for the Navy, 112th Cong., 2nd sess.,
February 16, 2012.
97 Secretary of the Navy Ray Mabus, Remarks at the Sea Air Space Exposition, April 16, 2012.
98 “The Department of the Navy’s Energy Goals.” http://www.navy.mil/features/Navy_EnergySecurity.pdf
99 “US Government to invest $510M in advanced, drop-in biofuels,” Biofuels Digest, August 16, 2011.
(continued...)
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alternative fuel purchases for testing and certification purposes and $170 million commitment to
support construction of biofuel production facilities add up to slightly more than $200 million (a
more in-depth discussion on the Navy’s role in developing biofuels is discussed later in this
report: see “Navy Role in Developing Advanced Biofuels”).
Table 3 lists what the Navy describes as its major operational energy initiatives. The last item in
the table—alternative fuels testing and certification—includes Navy testing of equipment
performance and reliability on non-petroleum fuel, but does not include Navy efforts to promote
the development of advanced biofuels.
Table 3. Major Navy Operational Energy Initiatives
Initiative Description
Goals
Funding (millions)
FY2012 FY2013 FYDP
(requested)
(FY13-
FY17)
Aviation
Expands simulator
Significant reduction in fuel
$64 $68.1 $351.5
Simulator
capacity and improves
consumption,
Upgrades
fidelity to real-world
improvements in tactical
flight conditions.
training.
DDG-51 hybrid
Adds electric motor to
Efficiency gains of up to
$14.6 $13.1 $235.3
electric drive
the propulsion plant to
10%, or about 5,500
retrofit
allow for more efficient
barrels per ship per year.
low-speed operation.
Variable Cycle
Allows for optimizing
Reduced fuel
$19.5
$20.7 $152.6
Advanced
engine performance on
consumption, higher
Technology
the fly, more efficient
performance, increased

Engine
low-speed operation.
range and loiter
Aviation Energy
Extends the Navy’s
reduced energy
$23.9 $19.2 $152.6
Conservation
standardized ship
conservation
RDT&E
energy best practices to
aviation.
Maritime “Quick
Stern flaps, propeller
Achieve payback periods
$13.4 $17.4 $76.8
Wins”
coatings, solid state
of less than 2 years, and
lighting, etc.
returns on investment
(ROIs) ranging from 3:1 to
45:1.
Alternative Fuels
Testing alternative fuel
Greater choice in tactical
$16 $11.1 $65.3
Testing and
blends in ships and
fuels, lower greenhouse
Certification
aircraft.
gas emissions.
Source: Data provided by the Navy March 2012, drawing on the FY2013 Department of the Navy Energy
Program Overview; More detailed information on the Maritime “Quick Wins” drawn from Rear Admiral Tom
Eccles. Chief Engineer, NAVSEA. “Building a Foundation for the Green Fleet.” Briefing. October 12, 2010. p. 2.

(...continued)
http://www.biofuelsdigest.com/bdigest/2011/08/16/usda-doe-usn-to-invest-510m-in-advanced-drop-in-biofuels/,
“Defense Production Act Title III Advanced Drop-In Biofuels Production Act,” Special Notice, Solicitation Number
SN-12-15-PKM. https://www.fbo.gov/index?s=opportunity&mode=form&tab=core&id=
9ec4273b98ce62c3178916a432967581&_cview=0
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Marine Corps
The Marine Corps’ operational energy efforts focus primarily on reducing fuel-related operational
challenges and risks (such as the vulnerability of fuel supply lines) for Marine Corps forces
operating in the field.100 In support of this goal, the Marine Corps’ energy goals are to increase the
service’s overall efficiency by 50% by 2025, and to be able by 2025 to deploy a Marine Corps
expeditionary force that can operate self-sufficiently in terms of energy, except for vehicle fuel.
The Marine Corps’ FY2013 submission requests $64.5 million for operational energy efforts in
FY2013 and programs a total of $352 million for operational energy initiatives over the FYDP.
About 50% of the funding requested for FY2013 is for procurement of new equipment with
improved energy characteristics. The Marine Corps’ proposed FY2013 programs are intended to
reduce the fuel used by a Marine Expeditionary Brigade by 9%, allowing them to operate for 15
days without a fuel resupply, up from the current 14 days. Table 4 lists what the Marine Corps
describes as its major operational energy initiatives.
Table 4. Major Marine Corps Operational Energy Initiatives
Initiative Description Goals
Funding (millions)
FY2012 FY2013 FYDP
(requested)
(FY13-
FY17)
Solar Powered
Solar power for soldier
Enables extended patrol
$2.9 $12 $73.9
Adaptors for
equipment and
lengths and reduces or
Communication
expeditionary bases.
eliminates battery
Equipment Systems
resupply missions by
(SPACES) / Ground
infantry on foot; allows
Renewable
austere patrol bases to
Expeditionary Energy
operate entirely on
Networks (GREENS)
renewable power and
others to reduce fuel
consumption.
Experimental Forward ExFOB permits rapid
Streamlines adoption of
$6.7 $7 $36.6
Operating Base
testing and deployment
energy efficiency
(ExFOB),
of commercial energy-
technologies for
Expeditionary Energy
saving technologies for
expeditionary use.
Office (E2O)
Marines in the field.
Effort also involves
evaluation and Marine
education in
expeditionary energy
equipment.
Shelter Liners, LED
Tent insulation and
Reduces power demand
$0 $7.5 $37
lights
energy-efficient lights.
for field shelters.

100 Discussion with USMC officials, March 6, 2012.
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Initiative Description Goals
Funding (millions)
FY2012 FY2013 FYDP
(requested)
(FY13-
FY17)
Advanced Medium
Improved field
17% greater efficiency,
$6.2 $11.2 $40.2
Mobile Power
generators.
permitting reduced fuel
Sources (AMMPS)
consumption and
reduced logistics
burden for remote
locations.
Medium Tactical
Vehicle efficiency
15% improvement in
$1.4 $1.5 $11.6
Vehicle Replacement
improvements.
fuel efficiency.
(MTVR)
Source: Data provided by the Marine Corps March 2012, drawing on the FY2013 Department of the Navy
Energy Program Overview.
Army
The Army’s operational energy efforts focus on reducing energy demand, increasing fuel
efficiency, and increasing the use of alternative and renewable energy. The Army’s
FY2013 budget submission requests $560 million for operational energy initiatives, and
programs a total of about $4.1 billion across the FYDP, of which $3.3 billion is for
procurement of new equipment and $832 million is for science and technology research.
In April 2012 the Army opened the Ground Systems Power and Energy Laboratory to
conduct research and development on mobility power and energy. The Base Camp
Integration Laboratory is where the Army tests and evaluates new technologies/systems
for basing during contingency operations, including smart micro-grid prototypes, more
efficient environmental control units, rigid-wall shelters, and re-locatable buildings.101
Many of the Army’s energy initiatives are intended to increase the Army’s ability to operate
remotely and in a broader variety of terrain. Table 5 lists what the Army describes as its major
operational energy initiatives.

101 Data provided by the Army to CRS, June 1, 2012.
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Table 5. Major Army Operational Energy Initiatives
Initiative Description Goals
Funding (millions)
FY2012 FY2013 FYDP
(requested)
(FY13-
FY17)
Bradley armored
Improves transmission Reduced fuel consumption.
$12.2
$81.7
$955
vehicle upgrades
and power
management.
Advanced Mobile
Next-generation
Reduce fuel consumption
$35.8 $50.7 $721
Medium Power
battlefield generator.
by 21%; decrease
Sources (AMMPS)
maintenance requirements.
Abrams tank
Provides an improved
Generate increased levels
$9.6 $110.7 $543
upgrades
auxiliary power unit.
of electrical power to
support more capabilities.

Improved Turbine
Program to improve
Increase fuel efficiency by
$0 $8.4 $518
Engine Program
engine efficiency and
25%; extend operational
(ITEP)
extend operational
parameters from 4000
capability.
feet/95˚F to 6000
feet/95˚F.
Aviation
Use flight simulators
Reduce fuel and
$116 $105.4 $369
Simulators
to reduce flying time
maintenance costs.
for helicopters.
Logistics Civil
Requires contractors
Greater energy efficiency
$0 $0 $0
Augmentation
to identify energy
at contingency bases,
Program
savings initiatives in
saving more than 1 million
(LOGCAP) IV
current operations.
gallons of fuel per year in
Afghanistan.
Source: Data provided by the Army, April 25, 2012, based on Army Energy & Sustainability Program Overview
Briefing to House Armed Services Committee Staff, February 17, 2012.
Past Legislation on DOD Energy Use
Congress has been concerned with energy policy since the 1970s, and has passed legislation
relating to federal government energy use, including DOD installation energy use. Congress has
set specific energy-reduction targets for DOD installation energy, but not for operational energy.
Installation Energy
Congress has set targets for reducing federal (including DOD) government energy use and for
increasing renewable power. Section 203 of the Energy Policy Act of 2005 (H.R. 6/P.L. 109-58 of
August 8, 2005) states that “The President, acting through the Secretary, shall seek to ensure that,
to the extent economically feasible and technically practicable, of the total amount of electric
energy the Federal Government consumes during any fiscal year,” not less than 7.5% in FY2013
and each fiscal year thereafter shall be renewable energy. Section 431 of the Energy
Independence and Security Act of 2007 (H.R. 6/P.L. 110-140 of December 19, 2007) requires
federal building energy use to be reduced 30% by FY2015. Section 142 of the law mandates a
20% reduction in annual non-tactical vehicle petroleum use, and a 10% increase in annual non-
tactical alternative fuel use, by the start of FY2015, as measured from an FY2005 baseline.
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Section 433 of the law requires certain new and significantly renovated federal buildings to
reduce energy usage.
Congress has also enacted DOD-specific installation energy requirements. Section 2852 of the
FY2007 John Warner National Defense Authorization Act (H.R. 5122/P.L. 109-364 of October
17, 2006) “to produce or procure not less than 25 percent of the total quantity of electric energy it
consumes within its facilities and in its activities during fiscal year 2025 and each fiscal year
thereafter from renewable energy sources.” Section 2823 of the FY2012 National Defense
Authorization Act (H.R. 1540/P.L. 112-81 of December 31, 2011) directed DOD to set an interim
goal for 2018. These provisions are codified at 10 U.S.C. 2911(e).
Operational Energy
Position of Assistant Secretary of Defense for Operational Energy Plans and
Programs

Section 902 of the FY2009 Duncan Hunter National Defense Authorization Act established the
DOD position of Director of Operational Energy Plans and Programs (OEPP).102 The FY2011 Ike
Skelton National Defense Authorization Act redesignated the position as an Assistant Secretary of
Defense.103 The position is now codified at 10 U.S.C. 138c, which states in subsection (b) that the
Assistant Secretary of Defense for Operational Energy Plans and Programs shall:
(1) provide leadership and facilitate communication regarding, and conduct oversight to
manage and be accountable for, operational energy plans and programs within the
Department of Defense and the Army, Navy, Air Force, and Marine Corps;
(2) establish the operational energy strategy;
(3) coordinate and oversee planning and program activities of the Department of Defense and
the Army, Navy, Air Force, and the Marine Corps related to -
(A) implementation of the operational energy strategy;
(B) the consideration of operational energy demands in defense planning, requirements, and
acquisition processes; and
(C) research and development investments related to operational energy demand and supply
technologies; and
(4) monitor and review all operational energy initiatives in the Department of Defense.
Federal Policy Limiting Contracts for Procuring Alternative Synthetic Fuels
Section 526 of the Energy Independence and Security Act of 2007 (H.R. 6/P.L. 110-140 of
December 19, 2007) prohibits federal agencies from entering into a contract for procurement of
an alternative or synthetic fuel, including a fuel produced from nonconventional petroleum

102 S. 3001/P.L. 110-417 of October 14, 2008.
103 Sections 901(a)(1)(B), 901(b)(4), and 901(b)(7), H.R. 6523/P.L. 111-383 of January 7, 2011.
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sources, for any mobility-related use, other than for research or testing, unless the contract
specifies that the lifecycle greenhouse gas emissions associated with the production and
combustion of the fuel supplied under the contract must, on an ongoing basis, be less than or
equal to such emissions from the equivalent conventional fuel produced from conventional
petroleum sources.
DOD Policy on Fuel Efficiency of Weapon Platforms
Section 360(a) of the FY2007 John Warner National Defense Authorization Act (H.R. 5122/P.L.
109-364 of October 17, 2006) states that it “shall be the policy of the Department of Defense to
improve the fuel efficiency of weapons platforms, consistent with mission requirements, in order
to—(1) enhance platform performance; (2) reduce the size of the fuel logistics systems; (3)
reduce the burden high fuel consumption places on agility; (4) reduce operating costs; and (5)
dampen the financial impact of volatile oil prices.”
Fully Burdened Cost of Fuel As An Acquisition Consideration
As mentioned earlier, Section 332(c) of P.L. 110-417 states that “The Secretary of Defense shall
require that the life-cycle cost analysis for new capabilities include the fully burdened cost of fuel
during analysis of alternatives and evaluation of alternatives and acquisition program design
trades.” The provision is codified at 10 U.S.C. 2911 note.
Annual DOD Reports Relating to DOD Energy Use
Congress has required DOD to provide a number of reports related to operational energy. Among
these are the annual Energy Performance Master Plan and Report Related to Operational Energy.
Annual Energy Performance Master Plan
The requirement for an annual Energy Performance Master Plan was created by Section 2851 of
the FY2007 John Warner National Defense Authorization Act104 and amended in subsequent
legislation, including Section 2832 of the FY2011 Ike Skelton National Defense Authorization
Act.105 The provision is codified at 10 U.S.C. 2911(b), which states that the document is to be “a
comprehensive master plan for the achievement of the energy performance goals of the
Department of Defense, as set forth in laws, executive orders, and Department of Defense
policies.”
Annual Report Related to Operational Energy
The requirement for an annual Report Related to Operational Energy was created by Section
331(a) of the FY2009 Duncan Hunter National Defense Authorization Act.106 The provision is
codified at 10 U.S.C. 10 U.S.C. 2925(b), which states that the document is to be a “report on
operational energy management and the implementation of the operational energy strategy....”

104 H.R. 5122/P.L. 109-364 of October 17, 2006.
105 H.R. 6523/P.L. 111-383 of January 7, 2011.
106 S. 3001/P.L. 110-417 of October 14, 2008.
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Other Annual Reports
Under 10 U.S.C. 138c(e)(3), the Assistant Secretary of Defense for Operational Energy Plans and
Programs is required to annually review the budgets for operational energy activities of the
military departments and defense agencies and certify that the budgets are adequate to implement
the operational energy strategy. Other required annual reports relating to DOD energy include the
following:
• a list of DOD energy performance goals regarding transportation systems,
support systems, utilities, and infrastructure and facilities (10 U.S.C. 2911(a));
• a report on installations energy management detailing the fulfillment during the
previous fiscal year of DOD’s energy performance goals for that fiscal year as
set forth under the above provision (10 U.S.C. 2925(a)); and
• a report on mitigation of power outage risks for DOD facilities and activities
(10 U.S.C. 2911 note).
For a list of one-time reports that Congress has required on various DOD energy-related issues,
see Appendix D. For an expanded review of legislative activity relating to DOD energy, see
Appendix E.
Issues for Congress
DOD’s energy initiatives pose several potential policy and oversight issues for Congress.
The sections below briefly review several of these issues.
DOD Coordination of Service Operational Energy Initiatives
As discussed above, the various services have different energy goals and are pursuing different
energy initiatives. One potential oversight issue for Congress concerns DOD coordination of the
operational energy initiatives being pursued by the individual military services. As mentioned in
the previous section, one of the responsibilities of the Assistant Secretary of Defense for
Operational Energy Plans and Programs (ASD(OEPP)), which is codified by statute, is to
coordinate and oversee planning and program activities relating to operational energy. Potential
oversight questions for Congress include the following:
• How well is ASD(OEPP) coordinating the operational energy initiatives of the
various services?
• Have ASD(OEPP)’s coordination activities resulted in any changes to the
services’ proposed operational energy initiatives, and if so, what have been these
changes?
• How much latitude should the services have in developing their service-specific
operational energy strategies?
• Does ASD(OEPP) believe it makes sense, in terms of having a coordinated DOD
approach to operational energy, for DOD’s second-largest user of fuel—the
Department of the Navy—to attempt to spur a domestic advanced biofuels
industry, while DOD’s largest user of fuel—the Air Force—is not attempting to
do this, and has instead adopted an approach of not purchasing biofuels until they
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are cost competitive with petroleum-based fuels? What formal evaluation did
ASD(OEPP) conduct to inform or validate its belief?
• Are the operational energy initiatives of the services sufficiently coordinated?
What actions has ASD(OEPP) taken to ensure that there is no unnecessary
duplication or overlap in the operational energy initiatives of the services? What
process do the services have for consulting with one another on their operational
energy initiatives, and what changes in the two services’ initiatives have occurred
as a result of such consultations?
Data and Metrics for Evaluating DOD’s Initiatives
Another potential oversight issue for Congress concerns the status of DOD’s efforts to
gather data and develop metrics for evaluating DOD energy initiatives. Absent reliable
data, DOD lacks the information upon which to make sound policy decisions. Without
clear metrics, it is difficult to measure the effectiveness of the various energy initiatives
currently underway. As mentioned earlier, DOD has acknowledged that it faces a
challenge in gathering reliable data on DOD energy use for developing clear metrics to
evaluate the effectiveness of DOD energy initiatives.107 Potential oversight questions for
Congress include the following:
• What specific challenges does DOD currently face in gathering reliable data on
DOD energy use? What actions has DOD taken, or what actions does DOD plan
to take, to address these challenges? When does DOD anticipate having
reasonably comprehensive data on DOD energy use?
• If DOD currently faces challenges in gathering reliable data on DOD energy use,
how confident can it be in decisions it has already made regarding current DOD
energy initiatives? How do current challenges in gathering reliable data on DOD
energy use affect ASD(OEPP)’s ability to coordinate DOD operational energy
initiatives across the services?
• What are DOD’s current metrics for evaluating DOD energy initiatives, and how
were they developed? What assumptions underpin these metrics? If addressing
challenges in gathering reliable data on DOD energy use leads to a revision of
these metrics, when and how does DOD anticipate reporting these revised
metrics to Congress?
• In developing metrics for evaluating DOD energy initiatives, how much weight
does DOD give to the various financial, operational, and strategic challenges and
risks discussed earlier (see “Challenges and Risks Associated with DOD’s Use of
Fuels”)? To what extent are factors such as potential climate effects (e.g.,
greenhouse gas emissions) or environmental degradation (e.g., pollution) used by
DOD as metrics for evaluating DOD energy initiatives?
DOD Estimate of Future Fuel Costs
As mentioned earlier, DOD in its FY2013 budget submission projects that fuel costs will decline
13% from FY2013 to FY2014 and then remain at that lower price through FY2017, primarily

107 Discussion with ASD(OEPP) officials, March 1, 2012.
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because DOD is projecting lower costs for refined products.108 Fuel appears to be the only
category for which DOD projects costs to decrease over the next four years.109 While some
analysts expect crude oil prices to decline, at least some of those analysts have said that DOD’s
projected declines may be overly optimistic.110 Underestimating future fuel costs can complicate
DOD budget planning and execution, and can lead to inaccurate evaluations of the potential cost-
effectiveness of DOD energy initiatives.
The Office of Management and Budget (OMB) provides the cost of crude oil to be used by
federal government departments in preparing their departmental budgets. DOD takes the OMB-
provided cost of crude oil and then adds a percentage markup to account for the difference
between crude oil costs and the costs of refined petroleum products. DOD calculates this refining
markup using actual figures from past years. DOD states that the actual markup in FY2011 varied
between 45% and 60%, and that the assumed markup in FY2012 is about 55%. In estimating
future fuel costs, DOD is assuming a 50% markup for FY2013 and 30% for FY2014-FY2017,
“consistent with standard practice between FY2007-FY2011.”111 A potential oversight question
for Congress is whether these markup rates are too high, too low, or about right.

DOD Role in Federal Energy Initiatives
Another oversight issue for Congress concerns what role DOD should play in federal government
energy initiatives. DOD is requesting substantial funding for an array of energy initiatives. In
some cases, DOD is partnering with other federal government agencies in energy initiatives. In
July 2010, for example, DOD and the Department of Energy (DOE) signed a Memorandum of
Understanding (MOU) to coordinate efforts to enhance national energy security and “demonstrate
federal government leadership in transitioning America to a low carbon economy.” The MOU
covers the development and testing of a wide range of energy efficiency and renewable energy
technologies to meet DOD energy needs or address national security, and “speed innovative
energy and conservation technologies from laboratories to military end users.”112 As a second
example, the Navy in August 2011 announced an MOU with Department of Agriculture (USDA)
and DOE agreeing to invest in developing a domestic advanced biofuels industry, with each
agency contributing $170 million.113
Potential oversight questions for Congress regarding DOD’s role in federal energy initiatives
include the following:
• Are DOD’s energy initiatives adequately coordinated with those of other federal
agencies? How much overlap or duplication, if any, is there between DOD’s
energy initiatives and those being pursued by other federal agencies? What
process does the executive branch use to coordinate energy initiatives across all

108 Data provided by DOD Comptroller, May 1, 2012.
109 National Defense Budget Estimates for FY2013, Office of the Undersecretary of Defense (Comptroller), March
2012, Table 5-5, “Department of Defense Deflators – TOA”, pp. 59-60.
110 Based CRS discussions with industry and government experts, March – May 2012.
111 Data provided by DOD Comptroller, May 1, 2012.
112 “Memorandum of Understanding between U.S. Department of Energy and U.S. Department of Defense,” July 22,
2010. http://energy.gov/sites/prod/files/edg/media/Enhance-Energy-Security-MOU.pdf
113 Memorandum of Understanding between The Department of the Navy and the Department of Energy and the
Department of Agriculture, http://www.rurdev.usda.gov/SupportDocuments/DPASignedMOUEnergyNavyUSDA.pdf.
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federal agencies? What criteria are used in this process to determine whether an
initiative should be pursued by DOD or some other federal agency? What
changes, if any, in DOD energy initiatives have been made as a result of the
executive branch’s process for coordinating federal energy initiatives?
• Under the July 2010 MOU between DOD and DOE, what role does DOD
anticipate having in “demonstrating federal government leadership in
transitioning America to a low carbon economy?” Given the wide range of
technologies included in the MOU, what technologies does DOD see as priority
areas? How will these “innovative energy and conservation technologies” move
from development to military end users, and what is DOD’s role in this process?
• Is the division in costs between the Navy, USDA, and DOE in the August 2011
MOU for developing a domestic advanced biofuels agency appropriate? How
was this division determined?
Navy Role in Developing Advanced Biofuels
Within the broader issue of DOD’s role in federal energy initiatives, a more specific oversight
issue for Congress concerns the Navy’s role in attempting to jumpstart a domestic advanced
biofuels industry. This issue has been the topic of substantial discussion and debate during
Congress’ review of DOD’s proposed FY2013 budget.114
The Navy and other supporters of the initiative argue or might argue the following, among other
things:
• Developing a domestic advanced biofuels industry will improve the Navy’s (and
the nation’s) energy security by diversifying the Navy’s (and the nation’s) sources
of energy.
• Developing a domestic advanced biofuels industry will reduce the Navy’s (and
the nation’s) exposure to financial shocks caused by short-term volatility in
petroleum fuel costs.
• The $200 million or so that the Navy plans to spend on advanced biofuels—
including $170 million in costs to develop the fuels and about $20 million
between FY2009-FY2012 for early purchases of advanced biofuels—is a small
fraction of the Navy’s annual cost for petroleum based fuel (which was about
$4.5 billion in FY2011), and an even smaller fraction of the Department of the
Navy’s total budget (which was about $173.0 billion in FY2012, including about
$15.7 billion for overseas contingency operations). In addition, the Navy’s
planned $170-million investment in developing a domestic advanced biofuels
industry will leverage equal investments being made by USDA and DOE.
• Early purchases by the Navy of advanced biofuels will help create production
economies of scale in the domestic advanced biofuels industry, causing the cost
of advanced biofuels to come down over time. The Navy over the longer run

114 See, for example, Frank Oliveri, “Senate’s Defense Policy Bill Is Next Battleground for Biofuels Supporters,”
CQToday, May 23, 2012; “House Armed Services Committee Votes to Ban Alternative Fuel Buys,” InsideDefense,
May 9, 2012; Noah Schachtman, “Republicans Order Navy to Quit Buying Biofuels,” Wired, “Danger Room,” May 14,
2012.
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anticipates that the cost of advanced biofuels will come down to a price
competitive with that of petroleum-based fuels.
Skeptics of the initiative argue or might argue the following, among other things:
• Given that about 90% of the fuel used by a Navy carrier strike group during a
typical overseas deployment lasting several months is obtained overseas, from
sources close to where the strike group is operating,115 it is not clear whether
developing a domestic advanced biofuels industry would do much in practical
terms to diversify the Navy’s fuel sources. There are alternatives that the Navy
could pursue to reduce its dependence on petroleum-based fuels, such as or
nuclear-propulsion for surface combatants other than aircraft carriers116 or kite-
assisted propulsion for Navy auxiliary ships.117
• It is not clear whether developing advanced biofuels would provide the Navy
(and the nation) with much protection against volatility in petroleum-based fuel
prices. Since advanced biofuels are intended to be drop-in substitutes for
petroleum-based fuels, providers of cost-competitive advanced biofuels might
simply adjust their prices up and down to match changes in prices for petroleum-
based fuels. An alternative way to insulate the Navy (and DOD) from short-term
volatility in petroleum-based fuel costs would be to purchase fuel through
multiyear contracts that lock in prices over the term of the contract—an approach
that has long been used by commercial airlines and other firms to insulate
themselves from volatility in energy prices.118
• The Navy’s decision to expend funding in an attempt to jumpstart a domestic
advanced biofuels industry, and to pay a cost premium for early biofuel
purchases, is not consistent with the decision by the Air Force—a service that
uses even more petroleum-based fuel than the Department of the Navy—to not
do these things.119
• Given the current high cost of advanced biofuels, and technical challenges
involved in developing cost-competitive advanced biofuels, it is not clear
whether the Navy’s initiative, even with the added efforts of USDA and DOE,
will succeed in establishing a commercially-viable domestic advanced biofuels
industry or in reducing the costs of advanced biofuels to levels competitive with
those of petroleum-based fuels.
• Particularly in light of current and future constraints on the Navy’s budget,
funding that the Navy is proposing to spend on advanced biofuels could be better
spent on other Navy program priorities, such as platform acquisition. The $200
million or so that the Navy has spent and plans to spend on this initiative is
roughly equivalent, for example, to the cost of a Joint High Speed Vessel (JHSV).

115 Data provided by the Navy, February 2012.
116 For a discussion of this option CRS Report RL33946, Navy Nuclear-Powered Surface Ships: Background, Issues,
and Options for Congress
, by Ronald O'Rourke.
117 For a discussion of this option, see CRS Report RL33360, Navy Ship Propulsion Technologies: Options for
Reducing Oil Use—Background for Congress
, by Ronald O'Rourke.
118 For a recent analysis of options for DOD to reduce exposure to fuel price volatility, see Defense Business Board,
Re-examining Best Practices for DOD Fuel Acquisition, June 2011.
119 Discussion with Air Force Energy Officials, March 6, 2012.
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Potential oversight questions for Congress include the following:
• Why is the DOD effort to jumpstart a domestic advanced biofuels industry being
led by the Navy rather than the Air Force? If the Navy were not attempting to
jumpstart a domestic advanced biofuels industry, would the Air Force decide to
do it?
• To what degree does DOD currently use multiyear fuel-purchasing contracts as a
means of insulating itself against short-term volatility in petroleum-based fuel
costs? What impediments (legal or otherwise) are there to having DOD increase
its use of such contracts, and could these impediments be mitigated through
legislation?
• What is the Navy’s specific projection for how quickly prices for advanced
biofuels will drop to levels competitive with those for petroleum-based fuels? On
what studies is the Navy relying for this projection, or for its confidence more
generally that biofuels will at some point become cost-competitive with
petroleum-based fuels? Do the Air Force, ASD(OEPP), and private industry
agree with the Navy’s interpretation of these studies?
• What studies did the Navy or DOD conduct to evaluate the cost-effectiveness of
developing a domestic advanced biofuels industry against the cost-effectiveness
of other options for diversifying the Navy’s fuel sources or for insulating the
Navy against volatility in prices of petroleum-based fuels?
Implications of Changes in Strategy
Another potential oversight issue for Congress concerns the potential implications for DOD
energy initiatives of shifts in U.S. military strategy, such as the new strategic guidance issued by
the Obama Administration in 2012, which, among other things, features an increased emphasis on
operations in the Asia-Pacific region.120 Shifts in strategy can have implications for how and
where the U.S. military will use fuel, as well as for risks that DOD could face as a result of its
reliance on liquid fuel. DOD officials, for example, project that, as a result of the new strategic
guidance, Army operational energy use will decline, while its installation energy use will remain
high.121 Potential oversight questions for Congress include the following:
• Are DOD energy initiatives aligned with DOD’s projected operational patterns
under the January 2012 strategic guidance? What changes in DOD’s energy
initiatives have been made as a result of this new strategic guidance?

120 See Department of Defense, Sustaining U.S. Global Leadership: Priorities for 21st Century Defense, January 2012,
8 pp. For additional discussion of this document, see CRS Report R42146, In Brief: Assessing DOD’s New Strategic
Guidance
, by Catherine Dale and Pat Towell, CRS Report R42448, Pivot to the Pacific? The Obama Administration’s
“Rebalancing” Toward Asia
, coordinated by Mark E. Manyin, and CRS Report R42493, Army Drawdown and
Restructuring: Background and Issues for Congress
, by Andrew Feickert.
121 Discussion with Army officials, April 2012.
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Legislative Action for FY2013
FY2013 National Defense Authorization Act (H.R. 4310/S. 3254)
House
As Reported
Section 253 of H.R. 4310 as reported by the House Armed Services Committee (H.Rept. 112-479
of May 11, 2012) states:
SEC. 253. BRIEFING ON POWER AND ENERGY RESEARCH CONDUCTED AT
UNIVERSITY AFFILIATED RESEARCH CENTER.
Not later than February 28, 2013, the Secretary of Defense shall brief the Committees on
Armed Services of the Senate and House of Representatives on power and energy research
conducted at the University Affiliated Research Centers. The briefing shall include—
(1) a description of research conducted with other university based energy centers; and
(2) a description of collaboration efforts with university-based research centers on energy
research and development activities, particularly with centers that have an expertise in
energy efficiency and renewable energy, including—
(A) lighting;
(B) heating;
(C) ventilation and air-conditioning systems; and
(D) renewable energy integration.
Section 313 states:
SEC. 313. EXEMPTION OF DEPARTMENT OF DEFENSE FROM ALTERNATIVE
FUEL PROCUREMENT REQUIREMENT.
Section 526 of the Energy Independence and Security Act of 2007 (P.L. 110-140; 42 U.S.C.
17142) is amended by adding at the end the following: `This section shall not apply to the
Department of Defense.’122

122 Section 526 of the Energy Independence and Security Act of 2007 (H.R. 6/P.L. 110-140 of December 19, 2007)
states:
SEC. 526. PROCUREMENT AND ACQUISITION OF ALTERNATIVE FUELS.
No Federal agency shall enter into a contract for procurement of an alternative or synthetic fuel,
including a fuel produced from nonconventional petroleum sources, for any mobility-related use,
other than for research or testing, unless the contract specifies that the lifecycle greenhouse gas
emissions associated with the production and combustion of the fuel supplied under the contract
must, on an ongoing basis, be less than or equal to such emissions from the equivalent conventional
(continued...)
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Section 314 states:
SEC. 314. LIMITATION ON AVAILABILITY OF FUNDS FOR PROCUREMENT OF
ALTERNATIVE FUEL.
(a) Limitation- Except as provided in subsection (b), none of the funds authorized to be
appropriated by this Act or otherwise made available during fiscal year 2013 for the
Department of Defense may be obligated or expended for the production or purchase of any
alternative fuel if the cost of producing or purchasing the alternative fuel exceeds the cost of
producing or purchasing a traditional fossil fuel that would be used for the same purpose as
the alternative fuel.
(b) Exception- Notwithstanding subsection (a), the Secretary of Defense may purchase such
limited quantities of alternative fuels as are necessary to complete fleet certification for 50/50
blends. In such instances, the Secretary shall purchase such alternative fuel using competitive
procedures and ensure the best purchase price for the fuel.
Section 2402 of the bill authorizes energy conservation projects at various locations inside and
outside the United States.
Section 2821 of the bill states:
SEC. 2821. CONGRESSIONAL NOTIFICATION FOR CONTRACTS FOR THE
PROVISION AND OPERATION OF ENERGY PRODUCTION FACILITIES
AUTHORIZED TO BE LOCATED ON REAL PROPERTY UNDER THE JURISDICTION
OF A MILITARY DEPARTMENT.
Section 2662(a)(1) of title 10, Untied States Code, is amended by adding at the end the
following new subparagraph:
`(H) Any transaction or contract action for the provision and operation of energy production
facilities on real property under the jurisdiction of the Secretary of a military department, as
authorized by section 2922a(a)(2) of this title, if the term of the transaction or contract
exceeds 20 years.’.
H.Rept. 112-479 states that Section 2821 “would require the Department of Defense to notify
Congress when entering into contracts for the provision and operation of energy production
facilities on real property owned by the United States if the contract is longer than 20 years.”
(Page 317)
Section 2822 states:
SEC. 2822. CONTINUATION OF LIMITATION ON USE OF FUNDS FOR
LEADERSHIP IN ENERGY AND ENVIRONMENTAL DESIGN (LEED) GOLD OR
PLATINUM CERTIFICATION AND EXPANSION TO INCLUDE IMPLEMENTATION
OF ASHRAE BUILDING STANDARD 189.1.
Section 2830(b) of the Military Construction Authorization Act for Fiscal Year 2012
(division B of P.L. 112-81; 125 Stat. 1695) is amended—

(...continued)
fuel produced from conventional petroleum sources.
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(1) in the subsection heading, by inserting after `and ASHRAE Implementation’ after
`Certification’; and
(2) in paragraph (1)—
(A) by striking `authorized to be’;
(B) by striking `by this Act’;
(C) by inserting `or 2013’ after `fiscal year 2012’; and
(D) by inserting before the period at the end the following: `and implementing ASHRAE
building standard 189.1’.
Regarding Section 2822, H.Rept. 112-479 states:
This section would continue the prohibition on the use of funds for Leadership in Energy and
Environmental Design gold or platinum certifications for fiscal year 2013 set forth in the
National Defense Authorization Act for Fiscal Year 2012 (P.L. 112-81). This section would
also limit the use of funds for implementation of ASHRAE building standard 189.1. The
committee remains concerned that the Department of Defense is investing significant
funding for more aggressive certifications without demonstrating the appropriate return on
investment. The committee looks forward to receiving the Department’s report required in
section 2830 of P.L. 112-81 by June 30, 2012. (Page 317)
Section 2823 of the bill states:
SEC. 2823. AVAILABILITY AND USE OF DEPARTMENT OF DEFENSE ENERGY
COST SAVINGS TO PROMOTE ENERGY SECURITY.
Section 2912(b)(1) of title 10, United States Code, is amended by inserting after `additional
energy conservation’ the following: `and energy security’.
H.Rept. 112-479 states that Section 2823 “would amend section 2912(b)(1) of title 10, United
States Code, to allow the Department of Defense to also use the energy cost savings resulting
from shared energy savings contracts for energy security. (Pages 317-318)
Section 3104 authorizes funds for FY2013 energy security and assurance programs necessary for
national security.
H.Rept. 112-479 also states:
ENERGY ISSUES
Energy and Fuel Budget Justification
The committee commends the Department of Defense for its emphasis on energy reductions,
investments in renewable projects that result in long-term savings, and more efficient
processes that reduce demand for fuel consumption. The committee is, however, concerned
by the lack of visibility into the annual investments in energy and expenditures on fuel. The
committee notes that the Department of Defense spent $19.4 billion in fiscal year 2011 on
energy, an increase from the total expenditure of $15.2 billion in fiscal year 2010. The
committee is concerned about fluctuating fuel prices, and the resulting shortfalls and impacts
on the operation and maintenance accounts.
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Therefore the committee directs the Secretary of Defense to submit to the congressional
defense committees in conjunction with the annual President’s Budget request, a separate
budget justification material on energy and fuel budget justification. The material should
include details of energy costs by account, energy investments by account, and details of fuel
expenditures. The committee recognizes that there are a variety of funding accounts and
mechanisms being leveraged for energy investments that result in reductions in long-term
sustainment costs. Therefore, the energy and fuel justification should include the details
regarding the total energy expenditures by account and investments being made for energy
by account and type of funds across the Future Years Defense Program to ensure that the
committee can exercise the necessary oversight for the investment in funds.
Regarding fuel expenditures, the committee seeks information regarding budgeted fuel
prices, adjustments to the account, resulting shortfalls or excesses, and details regarding the
accounts that funded any such shortfalls and the impact to those accounts. The committee
notes that in the fiscal year 2013 budget request, the projected price for fuel is $157 per
barrel, whereas the average price in fiscal year 2012 is $162 per barrel. The committee also
notes that the price for fuel projected across the FYDP is $137 per barrel. Recognizing the
volatility in the fuel market, the committee further directs the Secretary of Defense to more
accurately project fuel prices and to seek opportunities to enter into longer-term bulk fuel
contracts or identify other options that would stabilize the fuel accounts for the military
services.
Marine Energy Technologies
The committee is aware of the Navy’s efforts to develop and test wave marine and
hydrokinetic energy technologies as one of many technology solutions helping the Navy
meet its shore energy goals and mandates, as well as to potentially power maritime security
systems, and support at-sea surveillance and communications systems. The committee
directs the Secretary of Defense to provide a briefing to the congressional defense
committees by October 31, 2012, on the current and future investments in test wave marine
and hydrokinetic energy technologies, the payback associated with this investment, the
future of the program, and a map of possible locations in proximity to military installations
for employing this technology.
Navy Hybrid Electric Technology
The committee is aware of the Navy’s efforts to incorporate hybrid electric engines into its
fleet to reduce fuel consumption, and to help meet its energy goals. The committee directs
the Secretary of the Navy to provide a briefing to the Senate Committee on Armed Services
and the House Committee on Armed Services by October 31, 2012, on the current and long-
term employment of hybrid electric engine technology. The briefing should include details
on the potential long-term savings that may be achieved, the projected cost for incorporating
such technology in the initial design of engines, the cost to retrofit a platform with the
technology, and future plans to incorporate this technology into additional classes of ships in
the fleet.
Procurement Procedures to Incorporate the Use of Fuel Cells
The Defense Logistics Agency sponsored report, “Beyond Demonstration: The Role of Fuel
Cells in DOD’s Energy Strategy,” published on October 19, 2011, offers recommendations
with respect to the Department of Defense’s use of fuel cell technology for distributed
generation, backup power, unmanned vehicles, and non-tactical material handling
equipment. The committee is very interested in the Department’s use of fuel cells in defense
energy applications.
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The committee directs the Department to Defense to brief the congressional defense
committees no later than June 1, 2013, on the implementation of the report’s
recommendations. This brief should address how the Department is addressing the following
report recommendations:
(1) Develop and implement procurement models, which enable more efficient acquisition of
fuel cell systems, including through third-party financing mechanisms, such as power
purchase agreements;
(2) Require consideration of natural gas as well as renewable-fueled fuel cells for meeting
electric power, heating, cooling and back-up power requirements for new and major
renovations of DOD facilities and include evaluation of fuel cell options in all A/E design
contracts;
(3) Require that solicitations for energy services/electric power include consideration of
natural gas and renewable fueled stationary fuel cells and fuel cells for back-up power;
(4) Require that designers of unmanned vehicles evaluate fuel cells as an option for
providing power; and
(5) Encourage the incorporation of fuel cell power in material handling applications. (Pages
121-123)
The report also states:
Army Energy Initiatives Task Force
The committee recognizes the work the Army Energy Initiative Task Force has undertaken to
improve and expand opportunities with the private sector to execute large scale renewable
energy projects on Army bases. The committee encourages the Energy Initiative Task Force
to also consider alternative energy efficiency and other sustainability proposals that could
also assist the Army in meeting its energy goals.
Briefing on Alternative Power Applications on Military Installations
The committee recognizes that there may be merit to the development of small modular
reactors (SMR), that produce under 300 Megawatts, to support the electricity consumption
on military installations. The Center for Naval Analysis (CNA) report, entitled Feasibility of
Nuclear Power on US Military Installations, indicated that an SMR could be a viable option
for a military installation provided the Department does not assume First Of a Kind (FOAK)
expenses. If the Department was required or assumed FOAK expenses SMR was not
determined to be a viable option for military installations. The committee is interested,
however, in the Department’s assessment of the CNA report, and whether the Department
has assessed the practicality of partnering with interested parties that would undertake the
FOAK expenses in order to assess the viability of SMR on a military installation. The
committee, therefore, directs the Secretary of Defense to brief the House Committee on
Armed Services by December 31, 2012, on any actions the Department has undertaken to
date on this issue. If action has been taken to move forward on the deployment of SMR, the
briefing should include the current and potential budget for such an undertaking, including
any personnel costs associated with such projects, a timeline for the proposed projects, a plan
for storing the resulting nuclear waste, if necessary, the additional security requirement that
may be required, and any other factors that are pertinent to the successful execution of
establishing a SMR on a military installation.
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Briefing on Direct Solar and other Energy Efficient Technologies Applications on
Military Installations
The committee recognizes direct solar as one technology available to reduce Department of
Defense energy consumption and enhance energy security on military installations. The
committee also recognizes that direct solar devices such as daylighting systems and direct
solar pipe technology can have broader application across military installations and may
reduce demand load while providing light for facilities. In the committee report (H.Rept.
112-78) accompanying the National Defense Authorization Act for Fiscal Year 2012, direct
solar was listed as one of several possible technologies for the Department of Defense to
consider jointly with Department of Energy when generating its list of energy efficient
technologies. The committee, therefore, directs the Secretary of Energy in consultation with
the Secretary of Defense to brief the congressional defense committees no later than
December 31, 2012 about existing projects where direct solar devices as well as other energy
efficiency technologies listed in the Energy Performance Master Plan have been employed
across military installations. The briefing shall include a description of the most promising
technologies, the savings achieved, and details regarding the impact of such technologies on
the Department of Defense efforts to meet its energy goals and mandates.
Building Conversions
The committee is aware that the Department of Defense is contemplating facility standards to
support sustainable design features and has generally adopted Leadership in Energy and
Environment Design (LEED) standards to meet these requirements. The committee supports
sustainable design and building reuse standards that value existing and historic facilities as
integral elements of the overall installation. The committee believes that the adoption of
sustainable design and building reuse standards concurrently reduces the one time
construction and renovation costs. For example, the Department of the Army has indicated
their intent to reuse an existing building at Aberdeen Proving Ground, Maryland, and
upgrade the facility for the purpose of conducting high performance computing. The
committees urges the Secretary of Defense to adopt a comprehensive set of sustainable
design and reuse standards that values building reuse and provides facility savings.
Decentralized Steam Generation
In fiscal year 2013, the committee recommends authorization of over $180.0 million in
military construction projects to support rapid energy savings in decentralizing steam utilities
at three locations. In addition to the quick payback period, these investments are expected to
reduce steam lost in the transmission lines and provide a more reliable utility. While the
Department of Defense has proposed additional energy projects in the budget request for
fiscal year 2013, the Department has elected to not prioritize any further decentralized steam
systems. The committee supports investments in projects that provide a rapid return on
investment and believes the payback period associated with these facilities makes them ideal
candidates for future military construction projects.
Therefore, the committee directs the Secretary of Defense to brief the congressional defense
committees by March 1, 2013, on the current inventory of centralized steam systems. The
briefing should include an assessment of the costs to decentralize these steam systems, the
payback associated with decentralizing these assets, the current locations of decentralized
steam systems, the potential location of additional decentralized steam systems, and funding
options available to support these decentralized efforts.
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Department of Defense Energy Demonstration and Validation
The committee recognizes the services’ efforts to reduce energy consumption, increase use
of renewable energy, conserve water and utilize sustainability building practices for new
construction, and implement energy efficiency initiatives. In this resource constrained
environment, the committee commends the services’ for their efforts to ensure that energy
demonstration and validation programs continue to demonstrate an acceptable return on
investment. The committee urges the services to continue their efforts to transition
demonstration and validation energy programs into operational and installation initiatives
and ensure there continues to be a sufficient payback.
Departments of Defense and Energy Collaboration and Technology Transition
The committee notes that in July 2010, the Department of Defense and the Department of
Energy signed a memorandum of understanding (MOU) to encourage innovative energy and
conservation technologies, from research and development to end user applications within
the Department of Defense. The committee commends both agencies for working together to
maximize both of their technical expertise in emerging energy technology. The committee is
aware that the Department of Energy has made significant investment in the development of
alternative energy sources, and the committee urges the Department of Defense to leverage
those investments in its alternative energy initiatives. The committee is also aware that the
Department of Defense’s Environmental Security and Technology Certification program
funds an installation energy test bed to demonstrate energy efficiencies and renewable
energy technologies to validate performance, cost, and environmental impacts, and to
determine which technologies would be applicable for broader application across the
Department of Defense’s inventory of installations. The committee directs the Secretary of
Defense to provide a briefing to the congressional defense committees by October 31, 2012,
on the current status of activities under the MOU, details regarding the installation energy
technology selection process, the list of companies and technologies that received awards in
fiscal years 2011–12, a description of how the technologies were transitioned, and the
installations where they were employed.
Department of Defense Energy Technologies
The committee is aware of efforts by the Department of Defense to reduce energy
consumption and improve energy efficiency. The committee is aware of a variety of
technologies, to include waste-to-energy systems and other new technologies, which can
help the Department meet its energy goals and mandates. The committee encourages the
Department to leverage these technologies where appropriate and continue its efforts to
improve operational and installation energy programs....
Inclusion of Cost-Benefit Analysis for Energy Security
The committee recognizes the importance of energy security on military installations to
ensure access to reliable supplies of energy sufficient to meet mission essential requirements.
The National Defense Authorization Act for Fiscal Year 2012 (P.L. 112-81) required the
Secretary of Defense to establish a policy for military installations to include favorable
consideration for energy security in the design and development of energy projects on
military installations using renewable energy sources, and to provide guidance to
commanders in order to minimize the effects of a disruption of services by a utility. The
committee believes that energy security projects are vital to the operational requirements that
support national security. Therefore, the committee directs the Secretary of Defense to
ensure that any installation energy project that excludes energy security in its design due to
excessive costs provide details of the factors used to value energy security within the
required cost-benefit analysis.
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Increased Utilization of Third Party Financing for Energy Efficiency Projects
The committee recognizes that the Department of Defense has very aggressive goals and
mandates to reduce energy consumption on military installations and to enhance energy
security. A critical component of this effort includes large-scale energy efficiency and
conservation efforts at military installations, particularly through partnerships with the
private sector. The committee urges the Department and the service secretaries to partner
with third parties through energy savings performance contracts, enhanced use leases, and
other third party authorities to achieve their goals, maximize savings, and achieve a
demonstrated return on these investments. The committee also encourages the Department of
Defense to consider the best complement of technologies that provide energy security to
include consideration for those that provide continuous power at a cost-competitive price.
(Pages 309-313)
The report also states:
Turbo Fuel Cell Advanced Technology Development
The budget request contained $69.0 million in PE 62601A for combat vehicle and
automotive technology. Of this amount, $24.4 million was requested for ground vehicle
technology. The committee believes the integration of mature, advanced fuel cell
technologies into an engine that could effectively meet military logistic requirements should
be adequately resourced. The committee is encouraged by the work being done at the Army’s
Research, Development and Engineering Command-Tank Automotive Research,
Development and Engineering Center (RDECOM–TARDEC), where engineers are
developing a turbo fuel cell engine for the Heavy Expanded Mobility Tactical Truck, which
is the primary logistics vehicle being used in support of Operation New Dawn and Operation
Enduring Freedom. The committee notes that funding at RDECOM–TARDEC has been used
to manufacture tubular air electrodes for stable, high-performance solid oxide fuel cells. The
committee encourages RDECOM–TARDEC to continue its work in the development of the
turbo fuel cell engine and supports its efforts to increase energy efficiency utilizing
renewable and alternative sources of energy.
The committee recommends $69.0 million, the full amount requested, in PE 62601A for
combat vehicle and automotive technology. (Pages 63-64)
Floor Action
On May 17, 2012, as part of its consideration of H.R. 4310, the House passed H.Amdt. 1111, an
en bloc amendment that contained several amendments printed in the report (H.Rept. 112-485 of
May 17 [legislative day May 16], 2012) on H.Res. 661, providing for the consideration of H.R.
4310, including amendment number 98, which became Section 834 of H.R. 4310. The text of
Section 834 is as follows:
SEC. 834. ENERGY SAVINGS PERFORMANCE CONTRACT REPORT.
Not later than June 30, 2013, the Secretary of the Army, the Secretary of the Navy, and the
Secretary of the Air Force shall each submit to the congressional defense committees a report
on the use of energy savings performance contracts by the Department of the Army, the
Department of the Navy, and the Department of the Air Force, respectively, including each
of the following:
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(1) The amount of appropriated funds that have been obligated or expended and that are
expected to be obligated or expended for energy savings performance contracts.
(2) The amount of such funds that have been used for comprehensive retrofits.
(3) The amount of such funds that have been used to leverage private sector capital,
including the amount of such capital.
On May 18, 2012, as part of its consideration of H.R. 4310, the House passed H.Amdt. 1133,
which was amendment Number 52 in the report (H.Rept. 112-485 of May 17 [legislative day May
16], 2012) on H.Res. 661, providing for the consideration of H.R. 4310. H.Amdt. 1133 became
Section 2824 of H.R. 4310. The text of Section 2824 is as follows:
SEC. 2824. DEFINITION OF RENEWABLE ENERGY SOURCE FOR DEPARTMENT
OF DEFENSE ENERGY SECURITY.
Section 2924(7)(A) of title 10, United States Code, is amended by inserting before the period
at the end the following: `and direct solar renewable energy’.
The purpose of the amendment is to clarify that direct use solar energy technology is considered a
renewable energy source for the purposes of the requirement that DOD obtain 25% of its facility
energy from renewable sources by 2025.
On May 18, 2012, as part of its consideration of H.R. 4310, the House passed H.Amdt. 1137, an
en bloc amendment that contained several amendments printed in the report (H.Rept. 112-485 of
May 17 [legislative day May 16], 2012) on H.Res. 661, providing for the consideration of H.R.
4310, including amendment number 68, which became Section 349 of H.R. 4310. The text of
Section 349 is as follows:
SEC. 349. REPORT ON STATUS OF TARGETS IN OPERATIONAL ENERGY
STRATEGY IMPLEMENTATION PLAN.
(a) In General- The Secretary of Defense shall submit annually to the relevant congressional
committees a report on the status of the targets listed in the document entitled `Operational
Energy Strategy: Implementation Plan, Department of Defense, March 2012’, including—
(1) the status of each of the targets listed in the implementation plan;
(2) the steps being taken to meet the targets;
(3) the expected date of completion for each target if such date is different from the date
indicated in the report; and
(4) the reason for any delays in meeting the targets.
(b) Relevant Congressional Committees Defined- In this section, the term `relevant
congressional committees’ means—
(1) the Committee on Armed Services of the Senate and the House of Representatives;
(2) the Committee on Oversight and Government Reform of the House of Representatives;
(3) the Committee on Homeland Security and Governmental Affairs of the Senate;
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(4) the Committee on Foreign Affairs of the House of Representatives; and
(5) the Committee on Foreign Relations of the Senate.
Senate
Section 313 of S. 3254 as reported by the Senate Armed Services Committee (S.Rept. 112-173 of
June 4, 2012) states:
SEC. 313. LIMITATION ON AVAILABILITY OF FUNDS FOR PROCUREMENT OF
ALTERNATIVE FUEL.
(a) Limitation- Except as provided in subsection (b), none of the funds authorized to be
appropriated by this Act or otherwise made available during fiscal year 2013 for the
Department of Defense may be obligated or expended for the production or sole purchase of
an alternative fuel if the cost of producing or purchasing the alternative fuel exceeds the cost
of producing or purchasing a traditional fossil fuel that would be used for the same purpose
as the alternative fuel.
(b) Exception- Notwithstanding subsection (a), the Secretary of Defense may purchase such
limited quantities of alternative fuels as are necessary to complete engine or fleet
certification for 50/50 blends. In such instances, the Secretary shall purchase such alternative
fuel using amounts authorized for research, development, test, and evaluation using
competitive procedures and shall ensure the best purchase price for the fuel.
Regarding Section 313, S.Rept. 112-173 states:
Limitation on availability of funds for procurement of alternative fuel (sec. 313)
The committee recommends a provision that would prohibit the use of funds authorized to be
appropriated to the Department of Defense in fiscal year 2013 from being obligated or
expended for the production or sole purchase of an alternative fuel if the cost exceeds the
cost of traditional fossil fuels used for the same purpose, except for continued testing
purposes.
The committee notes that in December 2011, the Defense Logistics Agency, on behalf of the
Department of the Navy, purchased 450,000 gallons of biofuels for $12.0 million, which
equates to $26.66 a gallon. According to the Department of the Navy it was the single largest
purchase of biofuel in government history and was carried out in order to “demonstrate the
capability of a Carrier Strike Group and its air wing to burn alternative fuels.” The
Department of the Navy noted that, despite the use of operation and maintenance funds for
the purchase, the demonstration is deemed a research, development, test, and evaluation
(RDTE) initiative as justification for the higher cost per gallon.
The committee also notes that the Vice Chief of Naval Operations testified before the
Subcommittee on Readiness and Management Support on May 10, 2012, regarding pressure
on readiness accounts from increased fuel prices that “every $1 increase in the price per
barrel of fuel results in approximately $31M of additional cost annually above our budgeted
level.” Therefore, the high cost of fuel has direct and detrimental impact on other readiness
accounts.
The committee strongly supports initiatives undertaken by the Department of Defense to
reduce the fuel demand of the operational forces through affordable new technologies that
increase fuel efficiency and offer alternative sources of power. But given the pressure placed
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on current and future defense budgets, the committee is concerned about the use of operation
and maintenance funds to pay significantly higher costs for biofuels being used for RDTE
efforts. Therefore, the committee directs the Secretary of Defense to develop and promulgate
guidance to the military services and defense agencies on the difference between the
operational use of alternative fuels versus continued RDTE initiatives. (Pages 80-81)
Section 2821 states:
SEC. 2821. GUIDANCE ON FINANCING FOR RENEWABLE ENERGY PROJECTS.
(a) Guidance on Use of Available Financing Approaches- Not later than 180 days after the
date of the enactment of this Act, the Secretary of Defense, in consultation with the Under
Secretary of Defense for Acquisition, Technology, and Logistics and the Deputy Under
Secretary of Defense for Installations and Environment, shall issue guidance about the use of
available financing approaches for financing renewable energy projects and direct the
Secretaries of the military departments to update their guidance accordingly. The guidance
should describe the requirements and restrictions applicable to the underlying authorities and
any Department of Defense-specific guidelines for using appropriated funds and alternative-
financing approaches for renewable energy projects.
(b) Guidance on Use of Business Case Analyses- Not later than 180 days after the date of the
enactment of this Act, the Secretary of Defense, in consultation with the Under Secretary of
Defense for Acquisition, Technology, and Logistics, the Deputy Under Secretary of Defense
for Installations and Environment, and the Secretaries of the military departments, shall issue
guidance that establishes and clearly describes the processes used by the military
departments to select financing approaches for renewable energy projects to ensure that
business case analyses are completed to maximize benefits and mitigate drawbacks and risks
associated with different financing approaches.
(c) Information Sharing- Not later than 180 days after the date of the enactment of this Act,
the Secretary of Defense, in consultation with the Under Secretary of Defense for
Acquisition, Technology, and Logistics and the Deputy Under Secretary of Defense for
Installations and Environment, shall develop a formalized communications process, such as a
shared Internet website, that will enable officials at military installations to have timely
access on an ongoing basis to information related to financing renewable energy projects on
other installations, including best practices and lessons that officials at other installations
have learned from their experiences in financing renewable energy projects.
Section 2822 states:
SEC. 2822. CONTINUATION OF LIMITATION ON USE OF FUNDS FOR
LEADERSHIP IN ENERGY AND ENVIRONMENTAL DESIGN (LEED) GOLD OR
PLATINUM CERTIFICATION.
Section 2830(b)(1) of the Military Construction Authorization Act for Fiscal Year 2012
(division B of P.L. 112-81; 125 Stat. 1695) is amended—
(1) by striking `authorized to be appropriated by this Act’ and inserting `authorized to be
appropriated’; and
(2) by inserting before the period at the end the following: `until the date that is six months
after the date of the submittal to the congressional defense committees of the report required
by subsection (a)’.
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Section 2823 states:
SEC. 2823. PROHIBITION ON BIOFUEL REFINERY CONSTRUCTION.
Notwithstanding any other provision of law, neither the Secretary of Defense nor any other
official of the Department of Defense may enter into a contract to plan, design, refurbish, or
construct a biofuels refinery or any other facility or infrastructure used to refine biofuels
unless such planning, design, refurbishment, or construction is specifically authorized by
law.
S.Rept. 112-173 states:
Energy efficiency research and development coordination and transition
The committee is encouraged by the Defense Department’s efforts to coordinate with the
Department of Energy in pursuing and evaluating energy efficient technologies. The wide
variety of investments made by the Defense Department towards reducing energy usage has
already illustrated savings; however, the numerous organizations pursuing these initiatives
within the Defense Department and other federal agencies also presents increasing potential
for duplicative research and development as well as successful technologies not identified
and effectively transitioned. The continued cooperation and combination of technical
expertise as coordinated in the July 2010, memorandum of understanding (MOU) between
the Departments of Defense and Energy is important in maximizing the return on these
investments. The committee encourages the Defense Department to continue both internal
efforts and coordination with other agencies to manage ongoing and planned energy
efficiency research and development as well as continuing to establish processes for
effectively transitioning technologies for broader application across the Department of
Defense. (Pages 70-71)
The report also states:
Consideration of fuel cell systems
The committee is encouraged by many of the findings and recommendations included in the
Defense Logistics Agency (DLA) sponsored report, “Beyond Demonstration: The Role of
Fuel Cells in DoD’s Energy Strategy,” published on October 19, 2011. Among other things,
this report recommended that Department of Defense (DOD) headquarters organizations and
the military services: (1) develop and implement procurement models that enable more
efficient acquisition of fuel cell systems; (2) consider fuel cell systems for meeting electric
power, heating, and cooling demands whenever new facilities and major renovations are
planned and designed; (3) consider fuel cell systems when planning and designing backup
power capability for DOD sites; and (4) consider fuel cell power for material handling
equipment. The committee directs the DOD to report back to the congressional defense
committees no later than June 1, 2013, on the steps being taken to implement the
recommendations of the DLA report, or if the DOD does not intend to implement any of the
recommendations, to explain the reasons behind those decisions. (Page 89)
The report also states:
Energy performance savings contracts
The committee understands that the Department of Defense (DOD) spends billions of dollars
on energy costs each year and that financing large-scale energy projects can be cost-
prohibitive for the DOD. Energy Performance Savings Contracts (ESPC) enable the DOD to
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finance energy efficiency upgrades on military installations by funding various Energy
Conservation Measures, through private investments, and receive a guarantee that the energy
savings will pay for the project.
The committee directs the Secretary of Defense to review the potential applicability of ESPC
authority to construct power generating plants, and to acquire mobile sources, including
electric and natural gas-powered vehicles and their associated charging stations on military
installations, and to make recommendations to the congressional defense committees if
changes in law or regulation are needed for the Department to pursue efficient and effective
initiatives using ESPC authorities. (Page 92)
The report also states:
Solar power units
The budget request included $98.2 million in Other Procurement, Army (OPA), Overseas
Contingency Operations (OCO), for rapid equipping soldier support equipment (RESSE).
The committee notes that the Army’s Rapid Equipping Force has initiated the procurement
of solar power units that significantly increase the operational energy effectiveness and
sustainability of remotely located units in Afghanistan. These solar power units will be
deployed to support Village Stability Operations, and will substantially reduce the
requirement for fuel delivery by ground convoy or by air. These units provide sustainable
power for U.S. forces and the Afghan people. The committee recommends an increase of
$30.0 million in OPA OCO for RESSE solar power units. (Page 235)
FY2013 Department of Defense Appropriations Act (H.R. 5856)
House
As Reported
The House Appropriations Committee, in its report (H.Rept. 112-493 of May 25, 2012) on H.R.
5856, states:
ADVANCED DROP-IN BIOFUEL PRODUCTION
The request [for Defense Production Act purchases] includes $70,000,000 for the
construction or retrofit of domestic commercial (or pre-commercial) scale advanced drop-in
biofuel plants and refineries. The Committee understands that the Department has allocated
$100,000,000 of the $150,000,000 program addition to the fiscal year 2012 Defense
Production Act account for this effort and that $70,000,000 of this funding likely will not
execute until well into fiscal year 2013 or even into fiscal year 2014. While the Committee is
supportive of alternative energy development, in these times of decreasing budgets, it does
not seem prudent to stockpile funds so far ahead of need. Accordingly the recommendation
provides no funding for this effort in fiscal year 2013. The Committee urges the Secretary of
Defense to request this funding in future years when it can execute in a timely manner. (Page
203)
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Floor Consideration
On July 19, 2012, as part of its consideration of H.R. 5856, the House agreed to by voice vote
H.Amdt. 1428, an amendment to prohibit the use of funds to enforce Section 526 of the Energy
Independence and Security Act of 2007 (H.R. 6/P.L. 110-140 of December 19, 2007).123
FY2013 Military Construction, Veterans Affairs, and Related
Agencies Appropriations Act (H.R. 5854/S. 3215)

House
As Reported
The House Appropriations Committee, in its report (H.Rept. 112-491 of May 23, 2012) on H.R.
5854, states:
Rebates.—The Department of Defense has been increasing the use of green technology to
reduce energy consumption on military installations. The Committee commends this policy
but is concerned that the Department of Defense is not fully utilizing the potential savings
and rebates that may be available from the use of certain technologies or utilities. The
Committee directs the Deputy Under Secretary of Defense for Installations and Environment
to report to the congressional defense committees on the amount of rebates the Department
has been able to capture. (Page 16)
H.Rept. 112-491 also states:
Increased Fuel and Training Efficiency.—The Committee is aware of proposals by the
Department of Defense to use military construction funding to construct specialized training
runways near existing aircraft locations. By constructing these specialized runways, the
Department of Defense will save taxpayer dollars by decreasing the amount of transient
flight hours required for aircraft to reach their training locations. Therefore, the Committee
urges the Deputy Under Secretary for Installations and Environment to conduct a cost-
benefit analysis regarding the construction of specialized training runways near existing
aircraft locations and report back to the Committee within 180 days of enactment of this Act.
(Page 17)
The report also states:
LED lighting technologies.—The Committee understands that the use of LED lighting
technology at military facilities has demonstrated substantial energy efficiencies and cost
savings. However, the Committee is aware that LED lighting products of inferior quality
were used at some facilities and installations and has resulted in those locations failing to
achieve expected efficiencies. In some instances, this has led to policies prohibiting the use
of this technology. Accordingly, the Committee directs the Deputy Under Secretary of
Defense for Installations and Environment to establish minimum quality standards for the
use of LED lighting products at Department of Defense installations and facilities. The

123 For the text of Section 526 of P.L. 11-140, see footnote 122.
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standards should take into consideration Energy Star ratings and/or the Design Light
Consortium lighting product recommendations. (Page 17)
The report also states:
Sustainable Buildings Policy.—The Committee supports the Department of Defense’s
commitment to green buildings, and its goal to promote cost-effective sustainability.
However the Committee is concerned that the Department of Defense’s current approach to
sustainable construction appears to select one green building certification system over others,
particularly for wood products. The Committee expects the Department to ensure equal
acceptance of forestry certification systems, and that systems designated as American
National Standards are allowed to compete equally for use in the Department of Defense’s
building construction and major renovations while continuing to follow existing Buy
America requirements. The Committee also strongly urges the Department of Defense to
incorporate in its Sustainable Buildings Policy energy efficiency standards that are cost-
effective, incorporate Energy Star components, and the results of life cycle assessments. The
Committee directs the Deputy Under Secretary of Defense for Installations and Environment
to provide a report to the congressional defense committees on the Department’s efforts not
later than 90 days after enactment of this Act.
Energy security.—The Committee strongly supports Department of Defense efforts to reduce
costs and increase energy security through their investments in alternative energy sources.
The reliance on oil for forward-deployed operations leaves the military vulnerable to supply
shortages, attacks on fuel convoys, and volatile swings in the cost of petroleum. The
Committee recognizes that investments in clean alternative energy sources will make our
nation more secure and result in significant long term energy savings. Therefore, the
Committee directs the Department of Defense, as a follow up to the Operational Energy
Strategy Implementation Plan released on March 6, 2012, to report to the congressional
defense committees on how energy efficient construction on military installations will lower
operation and maintenance costs. This report shall be submitted within 90 days of enactment
of this Act. (Page 18)
The report also states:
Energy Conservation Investment Program.—The Committee believes that as new
construction and retrofit projects are undertaken at facilities to improve building energy
efficiency and achieve the objectives prescribed in statutes, executive orders, and initiatives,
the Department of Defense is encouraged to utilize new and underutilized, low-cost energy
efficient technologies that provide the best value to taxpayers through minimal lifecycle
costs. The Deputy Under Secretary for Installations and Environment shall report to the
congressional defense committees on the Department’s plan to implement these technologies
across the Department of Defense within 60 days of enactment of this Act. (Pages 20-21)
The report also states:
The Committee recommends a total appropriation of $1,650,781,000 for family housing
construction, family housing operation and maintenance, and the homeowners assistance
program, a decrease of $32,165,000 below the fiscal year 2012 enacted level and the same as
the budget request. The decrease below the 2012 enacted level is due partly to the
Department of Defense’s success in implementing the Military Housing Privatization
Initiative on military installations and the reduced requirement for appropriated construction
and operating costs. The Committee encourages the Department, where feasible, to utilize
energy efficient, environmentally friendly, and easily deployable composite building
materials in new family housing construction. (Page 23)
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Floor Action
On May 31, 2012, as part of its consideration of H.R. 5854, the House passed H.Amdt. 1166,
which added Section 522 to the bill. Section 522 states:
Sec. 522. None of the funds made available by this Act shall be available to enforce section
526 of the Energy Independence and Security Act of 2007 (P.L. 110-140; 42 U.S.C.
17142).124
Senate
The Senate Appropriations Committee, in its report (S.Rept. 112-168 of May 22, 2012) on S.
3215, states:
ENERGY POLICY
The Department of Defense is the largest consumer of energy in the Federal Government,
accounting for nearly 80 percent of the government’s total energy consumption. DOD spends
nearly $4,000,000,000 annually on facility energy alone, nearly a quarter of its total energy
costs. However, installation energy consumption accounts for nearly 40 percent of the
Department’s greenhouse gas emissions. The Committee commends the Department for its
aggressive efforts to improve the energy efficiency of its buildings and installations, reduce
consumption, mitigate its carbon footprint, invest in renewable energy projects, and enhance
energy security on its installations.
The Committee also supports the efforts of the Department to incorporate green building
technologies into both new construction and renovations of buildings. As noted in the past,
the Committee believes that the use of these technologies should be a fundamental
consideration in the design or retrofit of all military construction projects.
In particular, the Committee believes that the Department should maximize the use of energy
efficient, eco-friendly roofing technologies for new construction and renovations, including
family housing construction and renovation. These technologies include, but are not limited
to, photovoltaic panels, solar thermal roof coatings, rooftop direct use solar lighting
technology, green roofs, and cool roofs. In an effort to capture the most innovative of these
technologies, the Committee encourages the Department and the services to monitor new
technologies emerging from government, industry, or university research and development
programs.
Although federally mandated sustainable design policies and energy efficiency goals are
standard elements of military construction design, the Committee encourages the Department
and the services to incorporate additional leading-edge technologies into the construction

124 Section 526 of the Energy Independence and Security Act of 2007 (H.R. 6/P.L. 110-140 of December 19, 2007)
states:
SEC. 526. PROCUREMENT AND ACQUISITION OF ALTERNATIVE FUELS.
No Federal agency shall enter into a contract for procurement of an alternative or synthetic fuel,
including a fuel produced from nonconventional petroleum sources, for any mobility-related use,
other than for research or testing, unless the contract specifies that the lifecycle greenhouse gas
emissions associated with the production and combustion of the fuel supplied under the contract
must, on an ongoing basis, be less than or equal to such emissions from the equivalent conventional
fuel produced from conventional petroleum sources.
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program and to utilize new and underutilized, low-cost energy-efficient technologies that
provide the best value to taxpayers through minimal life-cycle costs.
While strongly supportive of DOD’s commitment to green buildings, and its goal to promote
cost-effective sustainability, the Committee is concerned that the Department’s current
approach to sustainable construction could result in giving preference to one green building
certification system to the exclusion of others, particularly wood products. The Committee
expects DOD to ensure equal acceptance of forestry certification systems, and to allow
systems designated as American National Standards to compete equally for use in the
Department’s building construction and major renovations, subject to Buy America
requirements.
Cybersecure Microgrids at Military Installations.—The Committee is impressed with the
progress the Department has made in deploying microgrids to mitigate risk to mission
critical assets and promote energy independence at military installations through the Smart
Power Infrastructure Demonstration for Energy Reliability and Security [SPIDERS]
program. However, the Committee remains concerned that most installations across the
country are dependent on commercial grids, which could potentially compromise the security
and access to reliable supplies of energy necessary to meet mission essential requirements.
The Committee believes the Department should study and evaluate using cybersecure
microgrid technologies to promote energy security. Therefore, the Secretary of Defense shall
submit a report to the congressional defense committees, no later than 180 days from the
enactment of this act, regarding: (1) the status of microgrid demonstrations currently
deployed domestically; (2) the Department’s plan to secure energy supplied to military
installations to meet mission essential requirements; and (3) the potential benefits of the
wide-spread use of secure microgrid technology on domestic military installations. (Pages 8-
9; material in brackets as in original)
S.Rept. 112-168 also states:
ENERGY CONSERVATION INVESTMENT PROGRAM
The Committee recommends the requested level of $150,000,000 for the Energy
Conservation Investment Program [ECIP]. The Committee also recommends a transfer of
$10,000,000 from unspecified Defense-Wide planning and design into a separate line item
for ECIP planning and design to ensure that adequate funds are available for future ECIP
project planning.
ECIP is the only dedicated stream of funding for energy projects within DOD. Historically,
ECIP has funded small projects with rapid payback. As DOD moves more aggressively to
develop renewable energy resources and improve energy security, ECIP is emerging as a
major tool to leverage investment in larger projects, such as net-zero energy facilities or
smart grid technologies, that are intended to produce significant improvements in energy
consumption, costs, and security at single or multiple installations. The Committee
encourages the Department to continue using ECIP funds to leverage investments in game-
changing major energy projects, particularly renewable energy initiatives.
The Committee notes that, in addition to ECIP funding, the fiscal year 2013 budget request
includes two projects in the major construction program intended primarily to improve
energy efficiency and security (an Army-funded ground source heat transfer system at Fort
Benning, Georgia, and a Navy-funded remotely controlled electrical distribution system at
Diego Garcia). The Committee believes that energy efficiency, energy security, and
renewable energy investments are mission-critical requirements to reduce DOD’s
dependence on costly and potentially unreliable sources of commercial energy, and
encourages the services and the defense agencies to aggressively pursue opportunities to
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include projects designed to improve installation energy efficiency and security in their
major construction programs as well as through ECIP. (Page 20; material in brackets as in
original; see also the table on page 88)

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Appendix A. DOD Budget Deflation Factors
Figure A-1. DOD Budget Outlay Deflation Factors, FY1970 - FY2017

Source: National Defense Budget Estimates for FY2013, Office of the Undersecretary of Defense (Comptrol er), March 2012, Table 5-9, “Department of Defense Deflators –
Outlays”, pp. 67-68.

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Appendix B. DLA-E Price Adjustments
Table D-1 shows how DLA-E in recent years has adjusted the price for a barrel of fuel multiple
times within individual years.
Figure B-1. DLA-E Fuel Price Per Barrel

Source: DLA-E Data, May 10, 2011.
Note: These prices are not inflation adjusted.


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Appendix C. Fuel Use in Afghanistan
This appendix presents some additional information on DOD fuel use for conducting operations
in Afghanistan.
In Afghanistan, fuel purchased by U.S. forces increased from 48 million gallons in FY2003 to
489 million gallons in FY2011, an increase of 920%.125 Total fuel purchases in Afghanistan over
this period exceeded 1.5 billion gallons (over $5.6 billion).126 This increase in fuel use tracked the
increase in troop strength: between FY2003-FY2011, the number of U.S. uniformed personnel in
Afghanistan increased from 10,400 to 97,000, an increase of approximately 830%.127 These
figures do not include fuel purchased outside of Afghanistan to support Operation Enduring
Freedom.
While aircraft account for the largest amount of fuel used to support operations in Afghanistan,
many aircraft are fueled outside of the country, where the logistics challenges are less pressing.
By contrast, generators are one of the largest consumers of energy on the ground in Afghanistan.
In August 2009, the Marine Energy Assessment team found that electrical power generation
accounted for 32% of the fuel used by the Marine Expeditionary Brigade – Afghanistan.128 Other
analyses estimate that climate control and air conditioning account for between 57% and 70% of
generator power demand. Army officials have also commented on the growing use of personal
electronic devices at bases in Afghanistan, which increase demand for electric power.129
Fuel and water, the most commonly transported supplies, make up approximately 70% of total
supplies shipped into Afghanistan.130 On a single day in Afghanistan, DLA-E and CENTCOM
counted approximately 5,396 trucks moving supplies for U.S. forces in Afghanistan, in addition
to an estimated 1,306 NATO and DLA-E fuel trucks.131 DLA-E provides about 1 million gallons
of JP-8, 7,000 gallons of diesel fuel, and 9,000 gallons of motor gasoline to U.S. forces in
Afghanistan daily.

125 A portion of the fuel purchased by DOD in Afghanistan was provided to Afghan security forces as part of the effort
to train and equip the Afghan National Security Forces. CRS does not have data on the precise amount of fuel provided.
126 This figure includes fuel purchased by U.S. forces from both DLA-E and NATO, which share responsibility for
providing fuel in Afghanistan. This figure does not include fuel purchased by NATO forces. This data also does not
include fuel purchased by DOD outside of Afghanistan to support Operation Enduring Freedom. For example, aircraft
supporting Operation Enduring Freedom upload a substantial amount of fuel at air bases located on the Persian Gulf,
and the Manas Transit Center in Kyrgyzstan is a major logistics hub. Data provided by DLA-E, March 1, 2012.
127 CRS analysis of Joint Staff, Joint Chiefs of Staff, “Boots on the Ground,” monthly reports, 2003 and 2011.
128 USMC, United States Marine Corps Expeditionary Energy Strategy and Implementation Strategy: Bases to
Battlefield, April 4, 2011, p 71. Data from the Report of the Marine Expeditionary Assessment Team, August 2009.
Data provided by MEB-A Bulk Fuels Officer.
129 Discussion with Army energy officials, March 2, 2012.
130 USMC, United States Marine Corps Expeditionary Energy Strategy and Implementation Strategy: Bases to
Battlefield
, April 4, 2011, p. 8, inset box.
131 Data provided by DLA-E, March 1, 2012. DLA-E is responsible for fueling U.S. and coalition forces in Regional
Commands East and North, while NATO has responsibility for Regional Commands South, Southwest, West and
Capitol (Kabul).
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Appendix D. One-Time Reports on DOD Energy-
Related Issues

Table D-1 shows a list of one-time reports that Congress in recent years has required DOD to
submit on various energy-related issues.
Table D-1. One-Time Reports on DOD Energy-Related Issues
Legislation Topic Deadline
FY2006 NDAA §357
Biofuel and Ethanol
October 3, 2006
FY2007 NDAA §360
Implementing Improvements in the Fuel Efficiency of
October 17, 2007
Weapons Platforms
FY2009 NDAA §332
Incorporating Fuel Logistics Support Requirements:
April 12, 2009
Implementation Plan

Progress Report
October 18, 2010

Notification of Compliance
October 18, 2011
FY2009 NDAA §333
Solar and Wind Energy for Expeditionary Forces
February 18, 2009
FY2009 NDAA §334
Alternative and Synthetic Fuels
March 1, 2009
FY2010 NDAA §333
Implementation of Recommendations on Fuel Demand
February 1, 2010
Management at Forward-Deployed Locations
FY2010 NDAA §334
Using Renewable Fuels to meet DOD Energy
February 1, 2010
Requirements
FY2011 NDAA §842
DOD Policy on Acquisition and Performance of
July 6, 2011
Sustainable Products and Services
FY2011 NDAA §901
Report on ASD reorganization must consider merging
September 15, 2013
ASD(ASD(OEPP)) and DUSD(I&E) positions
FY2008 NDAA §2864
Report on Renewable Energy Use by DOD
May 27, 2008
FY2010 NDAA §335
Vulnerability of Critical Military Missions to Electricity
April 26, 2010
Disruptions
FY2012 NDAA §2823
Interim Goal for Renewable Facility Energy by 2018
June 28, 2012
FY2012 NDAA §2830
Energy-Efficiency Standards for Military Construction
June 30, 2012

Note: NDAA is the National Defense Authorization act for the fiscal year in question.
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Appendix E. Expanded Review of Past Legislation
from 2005 Through FY2012

This appendix presents a more detailed review of past legislation on DOD energy-related issues
from 2005 through FY2012.
Energy Policy Act of 2005 (P.L. 109-58)
Section 203 of this act required federal agencies to procure 7.5% of their power from renewable
sources by FY2013. This section also defined renewable power sources.
FY2006 National Defense Authorization Act
Section 357 required a report on DOD use of biofuel and ethanol fuel, including potential DOD
requirements for increased biofuel and ethanol use and an assessment of current and future
availability of alternative fuels.
FY2007 John Warner National Defense Authorization Act (P.L. 109-
364)

The FY2007 NDAA represented a major expansion of DOD interest in energy security issues,
most notably Section 2851, which added Chapter 173 “Energy Security” to Title 10 of the U.S.
code. Section 2851 required DOD to establish energy performance goals, as well as reports on the
plan to meet these goals and on DOD’s annual energy use and progress towards meeting the
installation energy goals set by the Energy Policy Act of 2005.
Policy Changes
Fuel Efficiency in Weapons Platforms
Section 360 required DOD to improve the fuel efficiency of weapons platforms as DOD in order
to: “(1) enhance platform performance; (2) reduce the size of the fuel logistics systems; (3)
reduce the burden high fuel consumption places on agility; (4) reduce operating costs; and (5)
dampen the financial impact of volatile oil prices.”132 This section did not require a specific target
for improvements in fuel efficiency. DOD was required to submit a report on the how
improvements in the fuel efficiency of weapons platforms will be implemented.
Energy Performance Goals, Plan and Progress
Section 2851 required DOD to establish energy performance goals, including “transportation
systems, support systems, utilities and infrastructure and facilities.”133 These goals must be

132 P.L. 109-364, Sec. 360.
133 P.L. 109-364, Sec. 2911.
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submitted to the congressional defense committees annually by the date of the President’s
submittal of the defense budget to Congress. The Secretary was required to develop an energy
performance plan to meet these energy goals. This section also required an annual energy report
on the progress made on the Department’s energy performance goals and the goals of the Energy
Policy Act of 2005. This report must include a description of actions taken and energy savings
realized. The report was also required to include a breakdown of energy used by military
installations, including energy types, costs, and quantities consumed.134
Installation Energy
Section 2851 added several sections to the new Chapter 173, “Energy Security” dealing with
energy costs, savings, and contracts. The inserted section 2913 required a simplified method of
contracting for shared energy savings at military installations, while Section 2912 required DOD
to spend half the funds saved on additional energy conservation measures, leaving half of the
savings to be spent by the commanding officer of the installation on improvements to military
family housing, small construction, or morale, welfare or recreation facilities or services. Section
2914 authorized military construction for energy conservation, using available funds, with
Congressional notification. Section 2854 further amended the new Chapter 173, “Energy
Security,” to require energy efficient products in military construction as inserted Section 2915.
Renewable Power
Section 2852 required DOD to procure 25% of its electricity from renewable energy by FY2025,
and directed DOD to procure power from renewable sources whenever it is consistent with
DOD’s energy performance goals and plan established in Section 2851.
Fuel Cells as Back-Up Power
DOD was required by Section 358 to consider using fuel cells for current back-up power systems
to increase the longevity of the systems.
Energy Independence and Security Act of 2007 (P.L. 110-140)
Policy Changes
Alternative Fuels
Section 526 prohibited any federal agency, including DOD, from contracting for alternative or
synthetic fuels that have a lifecycle greenhouse gas emission greater than conventional petroleum
fuel. This prohibition is for all mobility fuels, with the exception of fuel for testing and
research.135

134 P.L. 109-364, Sec. 2925.
135 P.L. 110-140, Sec. 526.
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Installation Energy
For all federal agencies, EISA 2007 required building energy use to be reduced by 3% annually
through 2015 for a total reduction of 30% from a FY2003 baseline. It also mandated reductions in
non-tactical vehicle petroleum use by 20% and increases in alternative fuel use by 10% annually
by FY2015 from a FY2005 baseline. EISA 2007 also required new and majorly renovated federal
buildings to reduce energy usage by set percentages.136
FY2008 National Defense Authorization Act (P.L. 110-181)
Energy Efficient Lighting
Section 2863 required DOD to use energy efficient lighting fixtures in DOD facilities.
Renewable Energy Report
DOD was required by Section 2864 to submit a report discussing the extent of renewable energy
se, their financing via appropriated funds or alternative financing, and a graph of renewable
power as a percentage of total facility electricity use from FY2000 through FY2025, including
projected future trends. Following the initial report, this information was required to be included
in the Annual Energy Management Report, created by Section 2851 of the FY2007 NDAA.
FY2009 Duncan Hunter National Defense Authorization Act (P.L.
110-417)

The 2009 NDAA established an operational energy office, defined operational energy, and
required an operational energy implementation strategy The NDAA for FY2009 also required
acquisitions planning and analyses to consider energy, including lifecycle costs and fuel logistics,
as important factors. It also broadened the scope of the energy performance master plan required
by Section 2851 of the FY2007 NDAA to require separate master plans for each department or
agency and specific requirements and metrics to enable measurements of progress towards
achieving energy performance goals. Section 2832 added the progress made towards achieving
the goals of EISA 2007 to the annual energy management report.
The Act required several reports on alternative energy topics, including the viability of onsite
solar and wind energy to power expeditionary forces and the lifecycle emissions of alternative
and synthetic fuels.137

136 P.L. 110-140, Sec. 141, 142, 431, 433.
137 P.L. 110-417, Title III: Operations and Maintenance, Subtitle D: Energy Security.
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Policy Changes
Fuel in Acquisitions
Energy was highlighted as a required consideration in capacity analyses, force planning processes
and the acquisitions process. Section 332 required:
• Analyses and force planning to consider “requirements for, and vulnerability of,
fuel logistics.”
• Fuel efficiency to be included as a Key Performance Parameter (KPP) in the
requirements process. This requirement puts energy on par with other KPPs,
such as lethality, protection and reliability, during the requirements development
phase.
• In acquisitions, the lifecycle cost analysis for new capabilities must include the
fully burdened cost of fuel.
DOD must prepare an implementation plan for these requirements within 180 days of
enactment, and submit a progress report within 2 years. DOD must be in compliance
within 3 years or provide an explanation.138
Definitions
“Operational energy” and the “fully burdened cost of fuel” are both defined in the 2009
NDAA. Operational energy is defined in Section 331 as,
“operational energy” means the energy required for training, moving, and sustaining
military forces and weapons platforms for military operations. The term includes
energy used by tactical power systems and generators and weapons platforms.”139
The fully burdened cost of fuel is defined in Section 322 as,
“the commodity price for fuel plus the total cost of all personnel and assets required
to move and, when necessary, protect the fuel from the point at which the fuel is
received from the commercial supplier to the point of use.”140
Organizational Changes
Operational Energy Plans and Programs Office
The FY2009 NDAA established the Director of Operational Energy Plans and Programs office,
charged with drafting an operational energy strategy with “near-term, mid-term, and long-term
goals, and a plan for implementation of the strategy.”141 The two major responsibilities of the
appointed Director of Operational Energy Plans and Programs are the creation of a department-
wide operational energy strategy and implementation plan and the Director’s certification of the

138 P.L. 110-417, Sec. 332.
139 P.L. 110-417, Sec. 331.
140 P.L. 110-417, Sec. 332.
141 P.L. 110-417, Sec. 902.
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adequacy of the services’ budgets for implementing the operational energy strategy. Each service
must also designate a senior official to be responsible for operational for energy plans and
programs for that armed force within 90 days after the appointment of the Director of Operational
Energy Plans and Programs.
Operational Energy Strategy & Implementation Plan
The operational energy strategy will establish DOD goals for operational energy, performance
metrics to measure progress, while the implementation plan will create a plan for implementing
the strategy. This strategy was required within 180 days after the appointment of a Director.
Budget Certification Authority
Section 902 also required the Director of Operational Energy Plans and Programs to review the
budgets of the military departments and defense agencies in regard to their efforts under the
operational energy strategy. These proposed budgets must be submitted to the Director of
Operational Energy Plans and Programs for review before being submitted to the Under Secretary
for Defense (Comptroller). The Director must review the proposed budgets, and certify whether
the proposed budget is adequate to implement the operational energy strategy. Not later than
January 31 of the preceding fiscal year, the Director must submit a report containing commentary
on the proposed budgets, together with the budget certification.
If the proposed budget is not found to be adequate to achieve the operational energy
implementation plan, the Director may decline to certify it. In this case, DOD is required to
submit a report to Congress proposing remedies for the inadequacy of the budget within 10 days
of when the budget for the upcoming fiscal year is submitted to Congress.
Installation Energy
Section 2831 required DOD to certify to the defense committees that enhanced use leases
(Section 2667(h) of Title 10) longer than 20 years are consistent with the DOD energy
performance goals and plan of Section 2911 of Title 10.
The Annual Energy Report of Section 2925(a) of Title 10 was broadened to include DOD
progress in meeting the EISA 2007 installation energy requirements, and an estimate of progress
made by DOD to meet the certification requires regarding green building standards in
construction and major renovation, as required by Section 433 of EISA 2007.
Reports Required
Operational Energy
Section 331 required an annual report addressing operational energy to be submitted by the
Director of the Operational Energy Plans and Programs to the Congressional committees
concurrently with the annual DOD energy management reports. The annual operational energy
report must include extensive data about operational energy demands, expenditures, and efforts to
date and an evaluation of progress made in implementing the operational energy strategy.
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Solar and Wind Energy for Use by Expeditionary Forces
This report, due from the Secretary of Defense 120 days after the enactment of the NDAA for
FY2009, must consider “the potential for solar and wind energy to reduce the fuel supply needed
to provide electricity for expeditionary forces and the extent to which such reductions will
decrease the risk of casualties by reducing the number of convoys needed to supply fuel to
forward operating locations.”142 The report must also address the cost, potential savings,
environmental benefits, and sustainability and operating requirements of solar and wind
electricity generation for expeditionary forces, as well as potential opportunities for
experimentation and training.
Alternative and Synthetic Fuels
Section 334 required a report on ways to reduce the total lifecycle emissions of alternative and
synthetic fuels, including coal-to-liquid fuels. For military operations and expeditionary forces, it
must consider the usefulness of domestically-produced alternative and synthetic fuels to the
military utility and lifecycle emission of alternative fuels produced in-theatre.143 This report must
also evaluate DOD’s progress in research, testing and certification of alternative and synthetic
fuels for military vehicles and aircraft, and evaluate the ability of the alternative and synthetic
fuel industries to meet DOD fuel requirements, considering broad trends, levels of investment,
and development of refining capacity. This report was required by March 1, 2009.
Mitigation of Power Outage Risks
Section 335 required a technical and operational risk assessment of the risks posed to “mission
critical installations, facilities and activities ... by extended power outages”144 from a failure of the
grid or commercial electricity supply. DOD was required to develop plans to eliminate, reduce or
mitigate risks identified, prioritizing the mission critical installations, facilities and activities that
are at the greatest risk, considering the cost effectiveness various options. These prioritized plans
and progress made must be described in annual report as part of the budget justification materials
submitted to Congress for FY2010 and thereafter.145
FY2010 National Defense Authorization Act (P.L. 111-84)
The Director of Operational Energy Plans and Programs office received authorization of
$5,000,000 by Section 331, to be made available on the confirmation of a Director for the office.

142 P.L. 110-417, Sec. 333.
143 P.L. 110-417, Sec. 334.
144 P.L. 110-417, Sec. 335.
145 P.L. 110-417, Sec. 335.
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Reports Required
Annual Energy Management Report
Section 332 expanded the Annual Energy Management report, dealing principally with
installation energy, to discuss the feasibility and financing of renewable energy projects, detailed
funding information, and steps taken to ensure best practices for measuring energy consumption
in DOD installations. The first revised report must also address the adequacy of current funding
mechanisms to meet DOD installation energy goals, the cost and feasibility of requiring new
power generation projects to go off the grid during a grid outage, the feasibility of net-zero
installations, analysis of whether new DOD construction projects adhere to sustainable design
standards, and assessments of costs, obstacles, and other considerations of renewable power
generation on base.
On Implementation of Comptroller General Recommendations of Fuel Demand
Management at Forward-Deployed Locations

Section 333 required a report by February 1, 2010 on specific actions that DOD has taken on
three of the recommendations in a GAO report.146
Use of Renewable Fuels to Meet DOD Energy Requirements
Section 333 required a report considering the use of renewable fuels as alternative fuels for all
DOD aviation, maritime and ground fleets, including both tactical and non-tactical vehicles and
applications. Required by February 1, 2010, this assessment must consider domestically-produced
algae-based, biodiesel and biomass-derived alternative fuels and cover technical, logistical and
policy considerations. The report must also assess potential benefits of establishing a renewable
fuel commodity class distinct from petroleum-based products.
Energy Security on DOD Installations
Similar to Section 335 of the FY2009 NDAA, Section 335 of the FY2010 NDAA required the
Secretary of Defense to develop a plan to identify and address vulnerabilities to critical military
missions as a result of electricity disruptions.147

146 P.L. 111-84, Sec. 333.
147 P.L. 111-84, Sec. 333.
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FY2011 Ike Skelton National Defense Authorization Act (P.L. 111-
383)

Policy Changes
Energy Performance Master Plan
The energy performance plan of Section 2851 of the FY2007 NDAA was expanded by Section
2832 to a “master plan” to achieve the energy performance goals of “laws, executive orders and
Department of Defense policies.”148 This revised master plan must include:
(a) separate master plans for each Department and Defense Agency
(b) the use of a baseline standard for energy consumption that is consistent across departments,
(c) a method for measuring energy conservation
(d) “Metrics to track annual progress in meeting energy performance goals,” and
(e) a description of specific requirements and proposed investments.149
The current master plan must be submitted to Congress annually no later than 30 days after the
President submits his budget to Congress. The revised master plan must also consider hybrid
electric drives, high performance buildings and high efficiency vehicles.
Section 2832 also required adding hybrid-electric drive and alterative fuels and high-performance
buildings as special consideration in the plan.
Use of Energy Efficient Products in Facilities
In addition to amending the required reports, Section 2832 created a minimum list of energy-
efficient technologies, including roof-top solar, energy management systems, energy efficient
HVAC systems, thermal windows and insulation systems, electric meters, lighting and equipment
designed to use less electricity, hybrid vehicle charging stations, solar power vehicle shade
structures, and insulation and weatherproofing.
Pilot Study of Smart Microgrids for Deployment
Section 242 allowed DOD (with coordination from the Department of Energy) to carry out a pilot
program to evaluate and validate microgrids for deployment. This pilot program would be
intended to inform key performance parameters and “validat[e] energy components and designs
that could be implemented ... at forward operating bases.”150
DOD Policy on Acquisition and Performance of Sustainable Products and Services
Executive Order No. 13514, dated October 5, 2009, directed DOD and the federal agencies to
establish a strategy to procure sustainable products and services. DOD’s Strategic Sustainability
Performance Plan responds to this executive order. Section 842 requires DOD to submit a report

148 P.L. 111-383, Sec. 2832.
149 P.L. 111-383, Sec. 2832.
150 P.L. 111-383, Sec. 242.
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to the congressional defense committees on the status and achievements of DOD regarding these
sustainable procurement goals.
Organizational Changes: Operational Energy Plans and Programs Office
Section 901 redesignated the Director of Operational Energy Plans and Programs as the Assistant
Secretary of Defense for Operational Energy Plans and Programs.
This section also required the Secretary of Defense to consider merging the positions of Deputy
Undersecretary of Defense (Installations and Environment) and Assistant Secretary of Defense
for Operational Energy Plans and Programs into a single Assistant Secretary position by January
1, 2015, and report the feasibility of this merger to the Committees on Armed Services of the
Senate and House by September 15, 2013.151
FY2012 National Defense Authorization Act (P.L. 112-81)
The FY2012 NDAA continued the focus on operational energy and the logistics burden of fuel
evident in the FY2009 NDAA. Among other provisions, the FY2012 NDAA added alternative
fuels to the portfolio of the Assistant Secretary of Defense for Operational Energy Plans and
Programs and requires energy technologies and practices from contractors providing logistical
support for contingency operations.
Policy Changes
Alternative Fuels
Section 314 added oversight of DOD’s alternative fuel efforts to the responsibilities of the
Assistant Secretary of Defense for Operational Energy Plans and Programs.152 The Assistant
Secretary shall lead the alternative fuel activities and oversee alternative fuel investments, make
recommendations regarding the development of alternative fuels, encourage collaboration with
other federal agencies, and issue guidelines and policy to streamline alternative fuels investments.
The budget certification authority of the Assistant Secretary of Defense for Operational Energy
Plans and Programs will also include investment in alternative fuel activities.153 The annual
operational energy report initially required by Section 331 of the NDAA for FY2009 must now
include alternative fuels initiatives, including descriptions, funding and expenditures.154
Energy Efficiency in Contingency Operations
Section 315 required the energy performance master plan (amended by Section 2832 of the
FY2011 NDAA, discussed above) to address requiring energy efficiency or energy conservation

151 P.L. 111-383, Sec. 901.
152 P.L. 112-81, Sec. 314.
153 P.L. 112-81, Sec. 314.
154 P.L. 112-81, Sec. 314.
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measures in logistics support contracts for contingency operations. The energy performance
master plan must now include “goals metrics and incentives for achieving energy efficiency in
such contracts.”155 Any energy efficiency or conservation measures would be required to:
(1) “achieve long-term savings for the Government by reducing overall demand for fuel and other
sources of energy in contingency operations,”
(2) ... “not disrupt the mission, the logistics, or the core requirements in the contingency operation
concerned,” and
(3) be “able to integrate seamlessly into the existing infrastructure in the contingency operation
concerned.”156
Any guidance or regulations must consider the lifecycle costs savings of a technology or process
and require logistics support contractors to demonstrate savings over traditional technologies.
The energy performance master plan report must discuss the implementation of Section 315,
including savings achieved by the department.
The operational energy report must also discuss progress on applying energy efficiency measures
to logistics support contracts for contingency operations, per Section 315, while Section 342
requires the operational energy report to evaluate practices used in contingency operations to
reduce vulnerabilities related to fuel convoys, including improvements in tent and structure
efficiency, generator efficiency, and displacement of liquid fuels with on-site renewable
generation.
Energy Efficiency in Tents
Section 368 required including the total life-cycle costs for tents, including heating and cooling,
in calculating the best value of tents.
Definitions
Section 2821 provided a comprehensive set of definitions for energy terms used by DOD. Among
other terms, “energy security” is defined as “assured access to reliable supplies of energy and the
ability to protect and deliver sufficient energy to meet mission essential requirements.”157
“Defense logistics support contract,” discussed above, is defined in Section 315 as, “a contract for
services, or a task order under such a contract, awarded by the Department of Defense to provide
logistics support during times of military mobilization, including contingency operations, in any
amount greater than the simplified acquisitions threshold.”158

155 P.L. 112-81, Sec. 315.
156 P.L. 112-81, Sec. 315.
157 P.L. 112-81, Sec. 2821. This definition is very nearly the same as that used for “energy security” in the 2010 QDR.
The 2010 QDR reads, “... the ability to protect and deliver sufficient energy to meet operational requirements.”
158 P.L. 112-81, Sec. 315.
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Installation Energy: Renewable Energy and Energy Security
The FY2012 NDAA also contained a number of provisions related to installation energy. Section
2823 requires DOD to choose an interim goal for the amount of renewable power used in
FY2018, prior to the FY2025 goal of 25%.
DOD was also required by Section 2822 to favorably consider energy security in the design and
development of renewable energy projects on military installations. DOD must also issue
guidance for commanders of installations on planning measures to minimize the effects of
disruptions in natural gas, water or electric utility services. This section also adds energy security
of renewable energy projects to the required considerations of the energy performance goals and
plans, as well as geothermal energy.
The Annual Energy Management Report was also amended by Section 2822 to include details of
energy security provisions and details of the total number, frequency, financial impact of and
mitigation strategies for utility outages. Section 2826 sets the deadline for this report of no later
than 120 days after the end of each fiscal year.
Energy Data from Meters
DOD was required to capture and track data on energy usage from installation energy meters in
order to determine baseline consumption and help reduce energy consumption by Section 2827.
Section 2828 requires the Navy to meter its piers to allow the energy consumption of navy vessels
in port to be tracked. The progress of this effort must be included in the Annual Energy
Management Report.
DOD Energy Manager Training
Following Section 2829, DOD must establish a training policy for military installation energy
managers, focusing on improving their knowledge of current laws, mandates, regulations and
alternative energy options, improve consistency, and create opportunities for knowledge exchange
among departments and across DOD.
Organizational Changes
Section 311 added a senior official for operational energy plans and programs for the Joint Chiefs
of Staff and the Joint Staff, in coordination with the Assistant Secretary of Defense for
Operational Energy Plans and Programs.159

159 P.L. 112-81, Sec. 311.
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Author Contact Information

Moshe Schwartz
Ronald O'Rourke
Specialist in Defense Acquisition
Specialist in Naval Affairs
mschwartz@crs.loc.gov, 7-1463
rorourke@crs.loc.gov, 7-7610
Katherine Blakeley

Research Associate
kblakeley@crs.loc.gov, 7-0451

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