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7 Department of Energy The Department of Energy, created in July 1977, consolidates into a single department all the energy programs and powers that were previ- ously scattered throughout the federal government. The new depart- ment was given all the powers held by the Federal Power Commission, the Federal Energy Commission, and the Energy Research and Devel- opment Administrationâthree agencies that are now abolished. In addition, the new department gained control over energy programs that were housed in five other federal agencies. An organizational chart for the department is presented in Figure 7-1. The Department of Energy will contain an Office of Energy Research and a central energy data collection and analysis program. The Office of Energy Research will be responsible for monitoring the depart- ment's research and development programs and advising the secretary of the department on those matters. While it is impossible to know how much social research and related activities will be conducted by the Department of Energy, the three agencies that were taken over by the department obligated nearly $30 million in social knowledge production and application activities in fiscal 1977. Table 7-1 lists the agencies completely taken over by the Department of Energy and their fiscal 1977 social knowledge produc- tion and application activities. For Further Information Write Department of Energy. Washington, D.C. 20545. 123
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Department of Energy 125 TAB LE 7-1 Agencies Consolidated in the Department of Energy that Support Social Knowledge Production and Application: Profile (fiscal 1977, Smillions) Predominant Organizational Location of Total Social Social Social Knowledge Knowledge Knowledge Production Production Production and and and Agencies Prior Application Application Application Primary Goal to Consolidation Obligations Activity Activity or Audience" Energy Research 21.7 Research R&D agency Advancement of and Development knowledge Administralion Federal Energy 53 Research Operating Improvement of Administration agency federal program Federal Power 2.6 Research Operating Improvement of Commission agency federal program TOTAL 2V.6 Numbers may not total due to rounding. "See Chapter 2 for a more detailed discussion. ENERGY RESEARCH AND DEVELOPMENT ADMINISTRATION Social Knowledge Production and Application Obligations (Sthousands) Knowledge Production Activities Knowledge Application Activities Policy Policy Formula- Program General Implemen- Develop- Fiscal Re* tion Dem- Evalu- Purpose ration Dem- ment of Dissem- Year search onstrations ation Statistics Total onstrations Materials ination Total TOTAL 1976 IW7 12.105 21.750 12.105 12.105 21.750 21.750 The Energy Research and Development Administration (ERDA) was established by the Energy Reorganization Act of 1974 and began actual operations in 1975. The immediate purpose of ERDA was to reorganize and consolidate federal activities relating to research and development on the various sources of energy; the reorganization aimed to develop and increase the efficiency and reliability of the use of all energy sources to meet the needs of present and future generations. ERDA brought together in a single agency all the major energy research and
126 SURVEY OF FEDERAL AGENCIES development programs of the federal government aimed at finding ways to increase the supply of energy as well as to conserve the energy already available. Because ERDA was created in the middle of fiscal 1975, no figures are available for that year. The role of social research in ERDA is discussed in the Office of Technology Assessment's Comparative Analysis of the 1976 ERDA Plan and Program, which concluded that the ERDA'S R&D program did not give enough attention to socioeconomic analysis and research in addressing the nation's energy problems. Research Social research was funded in nearly every program area in ERDA. FOSSIL ENERGY The principal objective of this program is to expand the production of coal and accelerate the development of technology for converting coal to environmentally acceptable gas and liquid fuel. Examples of social research in the fossil energy area include: o economic feasibility of Alaskan coal development; o potential regional markets for coal conversion products; o economic evaluation of coal-based synthetic crude; o social, economic, and land-use impacts of coal conversion com- plexes; and o environmental impacts of coal conversion facilities and tech- nologies. SOLAR, GEOTHERMAL, AND ADVANCED ENERGY SYSTEMS The gOal Of this program is to work with industry to develop, demonstrate, and introduce those solar energy and geothermal heat systems that are economically attractive and environmentally acceptable for supple- menting the nation's energy resources. Examples of social research in this area include: o cost-benefit analysis of geothermal energy projects; o identification of the major technological, economic, institutional, legal, and other barriers to the widespread instruction and use of dif- ferent types of solar energy systems in the private and public sectors; o socioeconomic assessment of geothermal development in the Im- perial Valley, California; and o economic analysis of the cost of solar heating. NUCLEAR ENERGY A major responsibility of ERDA is working with American industry to design, develop, and demonstrate increasingly
Department of Energy 127 more effective nuclear power systems to meet the nation's growing demand for electricity and to determine whether these systems are safe in operation, economically feasible, and environmentally clean. Exam- ples of social research in this area include: o the role of nuclear energy in the western United States; o examination of the regulatory and other legal issues, institutional constraints, political issues, and societal concerns affecting timely completion of the light water reactor fuel cycle; o analysis of public perception related to nuclear fuel cycle ac- tivities; and o transportation issues related to shipping radioactive materials. ENERGY CONSERVATION ERDA supports research and development to improve technologies that can use energy more efficiently, provide alternative and more efficient fuels, and eliminate wasteful habits of energy consumption. Examples of social research in this area include: o socioeconomic impacts associated with conservation projects; o design of a methodology to analyze second-order environmental and economic impact of energy-conserving technology; o strategy/economic analyses in transition from oil and gas to alter- nate fuels in energy conversion devices; and o development of energy conservation planning methodologies. PLANNING AND ANALYSIS In addition to social research performed by the divisions described above, the Office of the Assistant Adminis- trator for Planning and Analysis also supports social research. Exam- ples of research supported by that office include: o development of economic, energy, and environmental models; o a study of patent policy; o a study of socioeconomic impacts of Western energy; o market assessments for new technologies in utilities, industry, transportation, and buildings; and o a venture ana', sis of technology development. For Further Information See ERDA, A National Plan for Energy Research, Development and Demonstration: Creating Energy Choices for the Future, Vols. 1 and 2, U.S. Government Printing Office, Washington, D.C., 1975; Office of Technology Assessment, An Analysis of the ERDA Plan and Program, May 1976, U.S. Government Printing Office, Washington, D.C., 1976.
128 SURVEY OF FEDERAL AGENCIES FEDERAL ENERGY ADMINISTRATION Social Knowledge Production and Application Obligations (Sthousands) Knowledge Production Activities Knowledge Application Activities Policy Formula- Program General tion Dem- Evalu- Purpose onstrations ation Statistics Total Policy Implemen- tation Dem- onstrations Fiscal Year Re- search Develop- ment of Materials Dissem- ination Total TOTAL 1976 1977 4.589 4.985 4.589 4.985 159 159 334 334 4.748 5.319 The Federal Energy Administration (FEA) was established in 1974 for the purpose of ensuring that the supply of energy available to the United States would continue to be sufficient to meet the total national energy demand. FEA was also given the responsibility for ensuring that, in case of energy shortages, priority needs for energy would be met and that the burden of shortages would be equitably borne. Because the agency was not in operation for all of fiscal 1975, no figures are avail- able for that year. Research Social research in the FEA is carried out in three major areas. ENERGY POLICY AND ANALYSIS Through quantitative analysis of vari- ous policy alternatives and assessment of the economic and social effects of these alternatives, statistical and analytical studies are pro- duced on which FEA could base the formulation and evaluation of energy policy. Specific areas of inquiry are: Energy Forecasting and Statistical Analysis FEA develops, applies, and maintains advanced econometric and process models of the energy system required for analyzing policy issues. Short- and long-range forecasts of energy supply and demand distribution and the relation- ships between energy and economic factors are supported. Examples of such models include: o development of price modeling and forecasting capabilities for crude petroleum and petroleum products; o development of a natural gas forecasting system to evaluate alter- natives on a regional basis in order to respond to policy options; o development of a sector-specific, regional-specific model of the
Department of Energy 129 fuel and power demands for energy that could be used to forecast energy demands through 1990 as a function of prices and other eco- nomic variables; and o development of a model of energy demand in the household sector with sufficient structure to allow analyses of the demand impacts of conservation options in this sector. Economic Impact Analysis This activity provides: (1) assessments of the state of the economy, (2) analyses of the effects on the economy of changes in energy supply and demand, and (3) analyses of energy- related policy proposals to achieve energy independence. Studies in- clude those mandated by Congress and the executive branch, for example, macroeconomic and socioeconomic studies, inflationary im- pact statements, analyses of constraints on energy resources develop- ment, and assessments of the regional impacts of energy policies, of the effects of regulations and prices on market structure, and of energy- producing and energy-conserving industries. A major focus of inquiry is the analysis of competition, market structure, and regulations. Energy Policy Development As a result of the Energy Policy and Conservation Act, FEA analyzes a number of major policy issues: Alaskan oil pricing, possible change in entitlements programs, possible decontrol for downstream price and allocation controls, and the revi- sions to the mandatory oil import program. ENERGY CONSERVATION AND ENVIRONMENT TllC promotion Of effi- ciency in the use of energy resources is one of FEA'S general missions, and research is supported to plan and analyze a variety of issues con- cerning energy conservation. Cost-benefit and macroeconomic studies are performed for selected major energy conservation measures, in- cluding the improvement of automobile efficiency, industrial energy use, and electric utility load management. INTERGOVERNMENTAL, REGIONAL, AND SPECIAL PROGRAMS A limited amount of social research is funded on energy problems related to state and local governments, special impact groups (the poor, the elderly, and the handicapped), and small businesses. Dissemination The FEA supports the National Energy Information Center, which is an information retrieval system that provides quick access to information on a broad range of energy issues.
130 SURVEY OF FEDERAL AGENCIES FEDERAL POWER COMMISSION Social Knowledge Production and Application Obligations (Sthousands) Knowledge Production Activities Knowledge Application Activities Policy Policy Formula- Program General Implemen- Develop- Fiscal Re- tion Dem- Evalu- Purpose tation Dem- ment of Dissem- Year search onstrations ation Statistics Total onstrations Materials ination Total TOTAL 1975 2.525 2.525 2.525 1976 2.600 2.600 2.600 1977 2.650 2.650 2.650 The Federal Power Commission (FPC) regulates the interstate aspects of the electric power and natural gas industries. The FPC has regulatory power over natural gas pipelines, nonfederal hydroelectric power proj- ects, and electric power and natural gas producers. The FPC is respon- sible for seeing that the nation's consumers have adequate supplies of gas and electricity at the lowest reasonable rates. Research Research is conducted by four offices in the FPC. The Bureau of Power is responsible for regulating the power supply; its research activities are concerned with determining the economic and environmental ef- fects of FPC decisions concerning power. The Bureau of Natural Gas is responsible for regulating the production and distribution of natural gas; its research efforts are focused on determining the economic and environmental effects of decisions concerning natural gas production and distribution. The Office of Energy Systems performs a policy plan- ning and analysis function while coordinating the commission's en- vironmental impact statements. The major research arm of the commission is its Office of Econom- ics, which prepares basic economic and statistical studies. It conducts research and advises the commission on the economic implications of policy issues in pending cases and proposed legislation involving the commission. Within the Office of Economics, the Division of Econometric Analysis applies advanced statistical and mathematical tools in developing quantitative inputs for the commission's regulatory decisions. The division has examined the following issues: factors af- fecting the supply and demand of natural gas; geographic price dif- ferentials for natural gas producers; cost behavior in regulated indus-
Department of Energy 131 tries; the price elasticity of demand; and long-term energy require- ments. Another division within the office, the Division of Economic Studies, is responsible for preparing comprehensive economic analyses, for example, on the probable economic consequences of al- ternative regulatory actions; recommendations concerning current and emerging policy issues; the economic factors basic to the efficiency of performance of electric utility and gas pipeline companies; and long- range needs for electric power and natural gas and how those needs can be met at the lowest possible costs.
