Pipeline proponents claim again and again that the project offers America a source of secure energy from a friendly and trusted ally.

Chamber of Commerce:

The Keystone XL Pipeline will provide our nation with a safe, secure supply of reliable and affordable energy from our trusted ally Canada.

Senator John Hoeven:

The Keystone XL is not only an important jobs and economic project; it will also reduce the nation’s dependence on volatile parts of the world for energy, which will make the nation safer.

Senator Mark Begich:

the Keystone XL pipeline would offer secure supply of energy from a trusted ally, […]


Yes, it’s a talking point.  But is it true?

Probably not.

Here, Senator Markey peels the onion:


And here, I tried (unsuccessfully) to get a straight answer from Canadian Ambassador Doer:



Over the weekend I spent some time at a local library. On a lark, I decided to look to see what they had on the shelves relevant to coal and climate change. This wasn’t the Library of Congress, so I didn’t expect to find very much, and I wasn’t wrong. That said, I kind of chuckled to myself a bit when I found this:


I borrowed it.

When I got home and found time to peek inside, I was reminded of some of my lower-level college courses. The full title of the book is “Coal (Opposing Viewpoints)”; the content consists of a series of essays collected from advocates lined up on opposing sides if various coal-related controversies.

One of the contributions supporting coal was provided by our old friend, the National Energy Technology Laboratory, or NETL (1, 2, 3). I wasn’t even a little bit surprised to find that the book’s editors found it appropriate to place a large comment from American Coalition for Clean Coal Energy (ACCCE) within NETL’s essay. After all, both organizations need to keep the “clean coal” myth alive, albeit for different reasons.

ACCCE uses “clean coal” to manage public opinion and create public pressure to be leveraged against policy makers and politicians. At NETL, budgets and jobs are at stake; they manage carbon capture and sequestration projects with price-tags running into the billions. They also do a substantial amount of in-house “clean coal” research.

To be fair to NETL and the scientists that work there, they do have a praiseworthy record. Their taxpayer funded research paved the way for the scrubbers responsible for (mostly) solving the acid rain problem of the 1980’s and 90’s.

In contrast, ACCCE’s direct predecessors (The Center for Energy and Economic Development and Americans for Balanced Energy Choices) did everything they could to deny acid rain and kill the regulations that made the scrubbers mandatory. Of course, today’s ACCCE flaks will tell anyone that’ll listen how much the coal industry has done to reduce their pollution. They don’t tell you that you paid for the research and even then, they they only installed the scrubbers when mandated by law (after they lost a protracted war of lobbyists in Washington).

Back to the book…

A few pages after NETL’s contribution, Jude Clemente argues that when it comes to our national security, coal is crucially important. He spends a significant amount of space advocating for coal liquification – a process by which coal is converted to a synthetic liquid fuel akin to gasoline or diesel. (Hitler’s war machine was fueled by liquified coal.)

There are about a thousand reasons coal liquification is a really, really bad idea. But…

Someone should tell NETL. Right now, this is on their splash page:
NETL Coal Liqufication Carbon capture and sequestration may as well be teleportation: there is simply no way the technology will be developed and deployed in time to serve its purpose.

I can’t help wondering if liquifiction is about to become Big Coal’s last stand..

Ten days ago, FossilAgenda traveled to Washington DC to attend a Cato Institute event.  In a small banquet room in the Rayburn House Office Building, Richard Lindzen, a Cato Distinguished Research Fellow, spoke to a near-capacity crowd of (mostly) young House staffers (free lunch was provided). According to the Cato’s event announcement, Lindzen would present comments related to the question: “Does History Predict the Future of Climate Science?

As it turned out, Linzen spent very little time discussing the history of science. Instead, he spent most of his time presenting a tired and discredited series of questions designed to confuse and/or mislead the young conservative staffers that might otherwise have been been seduced by the sledgehammer logic of record droughts, receding ice, invasive species, F5 tornadoes, record-breaking wildfires, and hurricanes of unprecedented strength.

At the end of his presentation, Lindzen accepted a few questions from the audience. Of course, I use the word “accepted” quite loosely. To be sure, he was happy to field questions from like-minded deniers. But when I respectfully pointed out that it was unlikely that many people in the room could make heads or tails of his obscure charts, but it was hard to miss the pictures from Cony Island and the Philippines… well… the shouting started before I could get any further. Seems the latest tactic in the denialist toolbox is volume.

After being shouted down, there wasn’t much left for me to do except wait for the formal event to conclude so I could follow up as Lindzen made his way out of the building. I actually managed to spend about 5 minutes with him, but again, any sort of meaningful exchange was utterly hopeless. It didn’t help that Lindzen had Pat Michaels on his wing. The aggressive, contemptuous and defensive tone that characterized our exchange is easily discerned in the audio clip I’ve posted below.

Ultimately, however, the hostile tone is of little consequence. It’s the content that matters.

And I’m interested: Is Michaels’ lie intentional, or was he misinformed?

Pat Michaels Says No Money From Donors’ Trust (mp3 download)

Michaels: How much money does Cato get from the fossil fuel industry?

FossilAgenda: They get it from Donors’ Trust, which washes it first.

Michaels: How much money does Cato get from Donors’ Trust?

FossilAgenda: I’d like to know… we’re looking into that.

Michaels: Oh, yeah, look into it. You’re going to find ZERO!

We looked into it. From Donors’ Trust 2012 990:



One year ago, survivors were still being pulled from Hurricane Sandy’s rubble. She made landfall on October 29, 2012. A year later, it is clear that many communities will never fully recover.

On Hurricane Sandy’s first anniversary, scores of elected Republicans seemed to have already pushed her out of mind. About 50 elected officials (almost all Republicans) spent part of their day speaking to a astroturfed crowd of coal supporters on the West Lawn of the Capitol. The rally was organized by the National Mining Association’s “Count on Coal” project. I attended the event hoping to speak with some of the miners that had been bussed in from coal states, but I soon learned they had been issued strict orders to avoid press. Instead their bosses required them to send media inquiries to the public relations professionals staffing the event. Yes, this was Astroturf.

Just to be clear: The miners were real miners. And aside from the “Impeach Obama” and other signage, they reminded me of the people I grew up with in the Adirondack mountains. They just want to make a living and enjoy their lives. But the world isn’t cooperating, and they need someone to blame.

I would have liked to have been able to report on the human interest component of the transition from coal, but with billions of dollars (and lives) at stake, it was unsurprising to learn of the gag order.

Instead, I turned my camera on the politicians. I decided to ask about their views related to climate science, disasters, and the government’s role in managing carbon emissions. This video is the product of two days of such reporting. The Miley Cyrus questions were asked on September 19th, 2013. All other clips were recorded last Tuesday, October 29 (Hurricane Sandy’s birthday).

The reactions you see in the video reminded me of former Congressman Bob Inglis.

Inglis used to be a far-right Republican from South Carolina. Until he was soundly defeated in his 2010 primary contest, he had earned a 93% lifetime rating from the American Conservative Union (the radical group that brings us the CPAC convention). Back in the day, he was one of the fire-brand panty-sniffers that took on the crucial role of House impeachment manager in the 1998 Republican coup effort.

He served two stints in Congress. He kept a self-imposed term-limit pledge and gave up his seat at the end of his 1998-2000 term. After a failed Senate bid, he returned to the House in 2004.

At some point, he got religion on climate science:

“…my children started to grow up. My son, my oldest of five kids, was voting for the first time in 2004 when I was running again, and he said, “You know, dad, I’ll vote for you, but you have to clean up your act on the environment.” I had this new constituency, an important constituency, because they could change the locks on the doors. My son and his four sisters all felt the same, and his mother did too.

So, that was one cause. The other cause was, I got on the science committee [House Committee on Science and Technology] soon after my second period in Congress started. And I got to go to Antarctica to visit there…”

Although he voted against cap and trade (he thought it amounted to a Rube Goldberg contraption of political policy), he was honest about his understanding of climate science:

e360: You’ve talked about a key moment in your [2010] campaign that occurred, I think, in Spartanburg at a big tent meeting. Can you describe that?

Inglis: Yes, at the Landrum airport. It’s a small landing strip, which is a great place to have events. There’s a big tent out there… So a question comes to me from the Christian talk radio host who is moderating the forum, and he says, “This question starts with Bob Inglis. Congressman Inglis, do you believe, yes or no, in human causation of climate change?” And you know, I have a terrible habit of answering questions, so I said, “Yes.” And boo, hiss, comes the crowd. It’s audible hissing and booing…

As a more workable alternative to Cap and Trade, in May, 2009, Inglis proposed a carbon tax. For a Republican, aside from the dead girl/live boy scenario, there may not have been a quicker path to political oblivion.

When a Democrat occupies the White House, the change in the Republican Party is palpable. In the 90′s we had Vince Foster, the Clinton Chronicles, Mena conspiracy talk, etc. Inglis was a part of that, though he regrets it now. It all culminated in the appointment of Ken Starr and the subsequent coup effort.

A decade later, Obama took the White House, and the dynamic is the same: Instead of drug dealing, there’s birtherism. Clinton had Ruby Ridge and Waco, Obama governs while Glenn Beck and Alex Jones create conspiracy theories featuring FEMA camps, Agenda 21, and gun (or ammunition) confiscation.

But while all of that is going on, there are serious policy battles (health care, immigration, carbon budgets) that are all but impossible to tackle because, even if they wanted to, Republicans are straight-jacketed by their base and conservative opinion leaders on talk radio and Fox News.

In fact, the difficulties Inglis faced did not begin and end with his acceptance of climate science. Another misstep that he credits with contributing to the toxicity of his primary campaign was the time he told an overly excited collection of Tea-Party activists to “…turn off Glenn Beck.” In 2010, that was a big, big mistake:

Beck’s role in all this is remarkably cynical, as he told USA Today Weekend that he personally believed in climate change — “you’d have to be an idiot not to notice the temperature change,” he said — but said the complete opposite on the air. “Americans know this global warming thing is a scam,” he proclaimed on the radio.

In 2007, 62 percent of Republicans believed in man-made climate change, but by late last year 53 percent of GOP voters said there is no evidence for it. In Delaware, a band of Beck aficionados called the Delaware 9-12 Patriots played a key role in ending the Senate ambitions and political career of moderate Republican Mike Castle, largely because Castle had voted for the anti-global warming plan known as “cap and trade.”

Do you think other Republicans took notice of Castle’s fate? Last month, the House Energy and Commerce Committee was asked to accept an amendment to a bill confirming that man made climate change is real. The vote among the GOP majority was unanimous — 31 votes against global warming.

But then, Beck has the GOP going off the rails on a crazy train, literally. In other industrialized capitals from Paris and Beijing, high-speed rail is seen as a futuristic way to grow the economy with the kind of a zeal that a very different America once held for its space program. But now the political tide has turned against high-speed rail, with talk radio leading the charge characterized scheduled train service as a form of totalitarianized mind control. Earlier this year, Beck summed up the far-right mantra on trains earlier this year when he said: “The trains run on time and there’s a schedule — and you’ll obey us and go where we want.” It would be laughable — except it came just as newly elected Tea-Party-darling governors Scott Walker in Wisconsin, John Kasich in Ohio and Rick Scott in Florida killed high-speed rail projects that would have brought federal dollars, and more importantly jobs, to residents of their recession-battered states.

I spoke with Inglis after he lost his primary election:

And here is incredibly compelling testimony Inglis put into the record just before he left Congress:


From the August, 2013 Coal People Magazine (page 8):

Where is Will Rogers when America desperately needs him?
by Geno Lawrenzi, Jr

Will Rogers, America’s beloved humorist and political commentator from the red hills of Oklahoma, had various sayings which he used to entertain his audiences and make them think. For example, if the President was vacationing, Will would praise him for his absence, pointing out that the longer he was away from Washington D.C., the less damage he could do to the American public.

We were thinking those same thoughts when Barack Obama, before leaving on a trip to Africa, told reporters he was implementing a new global warming policy that would make it much more expensive for energy plants and especially coal-fired energy plants to operate in the US.

Will was a Democrat and a close friend of Franklin Delano Roosevelt. Indeed, it was Rogers who suggested the Works Progress Administration that FDR adapted to put Americans back to work after the Great Depression. But for all his liberal ideas, Will believed in free enterprise and in creating jobs. We seriously wonder how he would have reacted to Obama’s decision to bypass Congress and use his Presidential powers to issue Executive Orders that may destroy America’s coal industry.

Excuse me, but did voters elect a President or a dictator in November 2012?

Coal companies have spent billions of dollars to make coal burn more cleanly. Their efforts have been costly but effective in eliminating mercury, sulfur, arsenic and other toxic emissions from the environment.

Why is Barack Obama bypassing our nation’s elected representatives in Congress on this important issue? Does he want to destroy even more jobs while saddling the average American family with higher electricity bills they cannot afford to pay?

Or as Will Rogers might have said in his Oklahoma drawl, “Mr. President, why didn’t you just stay in Africa a spell longer. We were getting along pretty well before you came along.”


He’s taking fire from all sides now:

Pilot-Online – they know when something smells bad, and they aren’t letting Cuccinelli off the hook:

The new details regarding the frequency and substance of the communication between Pigeon and the energy companies make Cuccinelli’s initial response, as implausible as it was, appear even more absurd.

And the details simply magnify the concerns expressed by a federal judge three months ago, when she described the attorney’s correspondence with the energy companies’ legal counsel as “shocking.”

The attorney general previously claimed Pigeon’s role was limited to defending the constitutionality of the Virginia Gas and Oil Act. But the latest reporting shows there were few, if any, limits to Pigeon’s advice, and a federal judge said she found no indication of advice pertaining to constitutional issues, the Bristol paper reported.

“Instead, Pigeon’s emails appear to have focused on such topics as the effect of a jury pool, judicial orders and other case issues, suggest references in court documents. She sent many of those emails months after a senior judge ruled on the constitutional challenges and after the attorney general’s office dropped out of the case.”

Cuccinelli’s office, the paper reported, resumed its involvement only when it became clear attorneys for the property owners sought copies of the emails.

The McCauliffe campaign:

ClimateProgress weighs in.


In December 2009, Dan Gilbert, a reporter for a small paper in Southwest Virginia, began what would become a nine-part series about Virginia landowners who have been unable to collect royalties when coalbed methane is extracted from their land. Ultimately, he won a Pulitzer Prize for his extraordinary work.

Four years later, it may be the case that his work ignited a fuse that led to the implosion of Ken Cuccinelli’s political career.

The short story:

  1. Gilbert’s reporting compels legislative action in April 2010
  2. Virginia’s new AG, Ken cuccinelli, issues an Advisory opinion that takes all the teeth out of the new legislation in June, 2010
  3. The land-owners sue
  4. Ken Cuccinelli asks for, and receives, permission to intervene on behalf of gas companies in the lawsuit for the “limited purpose of defending the constitutionality of the act”.
  5. A senior Assistant Attorney General, Sharon Pigeon, begins using her office to advise the gas-company attorneys on legal strategies unrelated to the constitutional issue.
  6. Plaintiff’s attorneys learn of Pigeons emails through discovery.
  7. Judge issues report expressing shock at AG’s office taking sides in case in June, 2013.
  8. AG Cuccinelli defends his office’s actions, writing of Pigeon, “My office intervened for the limited purpose of defending the constitutionality of the law. As is typical practice, the senior assistant attorney general cooperated with and shared information with both sides in the case. During the process of legal discovery, she cooperated fully with plaintiffs’ attorneys and their discovery requests.
  9. News reports surface in August demonstrating that Cuccinelli’s top deputy went to court to contest the discovery of Pigeon’s emails. In other words, she did not cooperate fully in the discovery process – she fought it. At best, one could say she participated in discovery. But court documents prove that, at least on this issue, there was no cooperation.

So I asked Mr. Cuccinelli about the discrepancy yesterday. Ultimately, after fielding other questions related to the gas case, Cuccielli stalked off in a pout. Here’s the video:


When I saw the former Senator on Capitol Hill last week, I remembered this report from David Halperin:

[Senator Trent] Lott abruptly resigned from the Senate in December 2007, less than two years into his fourth Senate term. Some pundits speculated that Lott chose that moment to resign because of a looming deadline — Senators still around after the start of 2008 would be covered by a new ethics law that prohibits former Members of Congress from lobbying for two years after leaving office. Lott responded that the new law “didn’t have a big role in that decision.” OK, not a big role.

Within 20 days of his resignation, Lott had formed the Breaux Lott Leadership Group with former Democratic Senator John Breaux (LA). The firm has represented a large number of energy companies, including Chevron, ExxonMobil, Entergy, General Electric, National Propane Gas Association, Plains Exploration, Shell Oil, and America’s Natural Gas Alliance. In 2010, Breaux Lott sold itself to mega-lobbying firm Patton Boggs, which itself also represents energy companies including ATP Oil & Gas and Total.

As the former Senator made his way toward the House office buildings, he gave me a few minutes. Loosely described, our discussion (transcript below) covered his clients (oil and gas, no coal), the Gulf Coast (recovering) and his personal energy conservation efforts. I tried to gauge how he squares his work with climate change and environmental damage, but aside from a stray comment, he steered the conversation away.

Here’s the transcript and audio:

Hello Senator, who are you up here working for today?
Oh, I like to think the people, still. (chuckling)

Somebody’s writing you a paycheck right? Are you working on behalf of any oil and gas companies?
No, But I’d be glad to. Not today, in fact I do work for some of them…

Peabody on the list?

Is Peabody on the list? Any coal at all?
Uh, no… We don’t do coal, I do natural gas and oil and refinery building…

Sure, stuff around the gulf

How is Mississippi recovering from uh…
Well, the state’s made a lot of progress but…

Deepwater Horizon?
Katrina is what really took the starch out of us. And then of course we had the BP oil spill… But overall, the coast is doing well, the economy has recovered… it just takes time to rebuild. When you get wiped out like my own community, only about half the people have rebuilt. In fact I have not rebuilt, mainly because my wife does not want to rebuild on the water.

Yeah, well she’s got some sense to her, right?
We lost everything we had in that house.

My God. So does that give you pause at all when you think about climate change and the impact these industries you’re working for have on all of us?
Well, we’ve had hurricanes forever.

We haven’t had oil spills like that forever.
No, and I do think we need to use every technique to make sure it’s being done properly and it’s transparent and all the modern capabilities and technologies are employed.

But they are lobbying against that. I don’t know if you are personally, but they didn’t want to put the right caps on that well to prevent that disaster, the way they had them in Norway…
Yes, but I do, I’m a production guy. I want more everything. I want more coal, I want more gas, I want more oil, I want more nuclear, I want more hydro, I’m for conservation.

Climate change doesn’t give you any pause at all.
I drive a MiniCooper.

Sure. Sure. What’s the mileage on those things?
A lot of my liberal Democrat environmentalist friends… they’re driving Ferrari’s and Mazzarati’s…

I know. And Escalades. The hybrid Escalade gets worse mileage than your MiniCooper.
I insulated my house. The whole house… that we bought after Katrina. I put insulation in the roof.

But none of that keeps the carbon from the air when we burn the stuff…
And… and… I heat and air-condition my house using geothermal.

That’s awesome.
How many liberal environmentalists do you know that have geo-thermal?

It’s hard to do…
I paid $25,000 to activate a defunct… And, by the way, here’s the good news: It cut my energy bill by 1/3… I mean like that! So I’m practicing what they preach!

(Lott closes car door, drives away)

Two comments:

  1. The Senator and his wife are very fortunate to be in a  position that allowed them to purchase a replacement home for the one they decided not to rebuild after Katrina. I wonder how many of his neighbors lost everything and did not have the resources required to purchase a new home to replace the one they lost. I wonder how many lost everything and have nothing left. I wonder how much climate change contributed to Katrina’s power. And I wonder how much the Senator’s current clients contributed to climate change.
  2. The argument that “I’m green in my personal life” sounds an awful lot like a hit-man telling me he’s a family man that never kills anyone when he’s not working.


Seems Brad Enzi, son of Mike Enzi, the Republican Senator from Wyoming, has been living large on fraudulently obtained stimulus cash.

A close read and comparison of the CBO and DoE OIG reports revealed the name of the Wyoming project faulted in the OIG audit. Turns out, there’s been significant movement, but nobody’s talking. So far, all we know is that a US Attorney responsible for civil recoveries has the case; I’ve found nothing indicating that a criminal investigation is underway.

From the DoE OIG report I referenced in yesterday’s post:

The Department reimbursed a third recipient about $3.7 million, or 74 percent of the award, even though documentation submitted to the Department lacked evidence that the costs claimed corresponded to the items in the approved project budget. Although the recipient had not responded to a prior request by the Department for detailed documentation concerning the project’s progress, additional funding through the Carbon Program was provided in September 2010 to expand work under an existing award. After receiving the additional funds, the recipient did not respond to numerous requests from program officials for documentation or questions related to the scope of work. Notably, officials suspended the award in January 2012 because the project was behind schedule, and the recipient failed to meet key deliverables. Department officials indicated that they were working with the recipient to recover unallowable costs. Until such time that all of the questionable costs have been repaid, we continue to question approximately $3.7 million in costs reimbursed by the Department.

Now this, from WyoFile:

A federal jobs stimulus project that paid more than $1 million in salaries and benefits to a wealthy Colorado businessman and his Wyoming representative has been suspended by federal officials for accounting irregularities and referred to a U.S. Attorney for review, WyoFile has learned.

The $9.9 million Two Elk Carbon Site characterization study – funded by a pair of U.S. Department of Energy stimulus grants in 2009 and 2010 — was supposed to drill a deep research well in Wyoming’s Powder River Basin to determine if the area had potential as an underground CO2 storage site.

However, by January 2012 when the project was suspended by DOE’s National Energy Technology Laboratory in Pennsylvania, federal records show that much of the money had already been spent on salaries and benefits for its Colorado promoter Michael J. Ruffatto, his Wyoming representative Brad Enzi, and other employees at Ruffatto’s North American Power Group, Ltd. headquartered in Greenwood Village, a Denver suburb.


A wealthy socialite and philanthropist who has homes in suburban Denver and Newport Beach, Calif., Ruffatto, 66, billed the government at the rate of $214.38 an hour, sometimes reporting 76-hour work weeks on the federal stimulus project, while continuing his full-time position as president and CEO of North American Power Group, which owns and operates several small power plants in California.

In 2009, Ruffatto sold one of his Southern California homes for $12.1 million to Los Angeles Angels baseball team owner Arte Moreno. Ruffatto’s 6,000-square-foot home in Cherry Hills Village outside Denver is appraised by the Arapahoe County Assessor at $9 million.

According to federal pay invoices obtained by WyoFile under the Freedom of Information Act, Ruffatto was compensated with the federal jobs stimulus funds at a rate exceeding $500,000 a year.

Enzi, 37, son of Wyoming U.S. Sen. Mike Enzi, was paid $80 an hour through the stimulus grant, earning as much as $17,363.72 in one month, according to the federal invoices. His father, Sen. Enzi, has been a consistent and vocal critic of the stimulus program, which in 2009 he called “bailout baloney.”
Federal officials would not say if Ruffatto and Enzi’s big paychecks were a factor in the January 2012 suspension of the Two Elk stimulus project.
Other invoices received by the Department of Energy from NAPG included $2,791,103 in payments to North American Land & Livestock for “heavy equipment mobilization; drilling pad and mud pit construction; drilling water procurement; layout area preparation.”


North American Land & Livestock is a Wyoming limited liability corporation created in 1996. Ruffatto is listed on incorporation papers as the manager and only officer.

WyoFile has done an incredible job on this story. There’s another aspect to this story that deserves your attention. I’ll bring it to you early next week. If you can’t wait, WyoFile has much more. While you’re over there, recognize that they are a non-profit news organization and can use your support. Their work on this has truly been awesome, so if you’ve got a little change in your pockets, they could use your help.


Last week, President Obama announced his plan for addressing climate change. The main thrust of his speech put Big Coal on notice: there will be new rules for power-plants and there will be no more free passes for carbon emissions. In short, coal’s days are numbered unless and until we figure out carbon capture and sequestration (CCS).

Today, the Administration threw Big Coal a another lifeline. Here’s Forbes:

The U.S. Department of Energy is floating a proposal to offer up to $8 billion in loan guarantees for fossil fuel technology projects that reduce the greenhouse gas emissions, the government said Tuesday.

Those projects could involve coal, natural gas, or oil production, waste heat recovery or carbon dioxide capture and sequestration. The proposal, which is open to public comment for 60 days, is offering a substantial help to the fossil fuel industry […]

What this amounts to is more money for junk science. Over the last few decades, we’ve spent billions developing clean coal and carbon capture and sequestration technologies. Nobody knows how many of those billions have been wasted, but a couple of government reports warrant your concern.

The first comes from DoE OIG audit.

From the audit’s webpage synopsis:

In particular, our review of the Carbon Program, including 15 recipients awarded a total of approximately $1.1 billion, revealed that the Department:

  • Had not adequately documented the approval and rationale to use $575 million of the $1.1 billion that we reviewed to accelerate existing projects rather than proceeding with new awards as required by Federal and Department policies. Even when program officials provided explanations regarding the selection process, our review of available documentation revealed evidence that was either inconsistent with or did not otherwise support their assertions.
  • Reimbursed recipients approximately $16.8 million without obtaining and/or reviewing adequate supporting documentation. Yet, we were able to identify, for one recipient, over $2.4 million in costs charged to the project that were questionable and/or unallowable. Despite a Department prohibition against reimbursing requests for pre-award costs, the Department reimbursed more than $1 million in such costs. In addition, the Department reimbursed approximately $14.4 million for costs incurred by three other recipients even though the costs were not substantiated by supporting documentation such as invoices.
  • Awarded three recipients over $90 million in Recovery Act funding even though the merit review process identified significant financial and/or technical issues. For example, the Department awarded more than $48 million to one recipient whose financial condition precluded it from obtaining a satisfactory merit review score. Rather than addressing the underlying issues, the Department accepted increased risk and lowered the recipient’s required cost share. At the time of our review, the recipient had been unable to raise even the reduced required cost share contribution, increasing the risk that the project’s goals may not be realized. We noted that 2 years after award, the three recipients had only spent about $7 million and experienced delays finalizing agreements due to problems meeting financial commitments and overcoming technical issues impacting the scope of work for the projects. The challenges precisely paralleled the initial concerns raised during the merit review process.
  • Had not ensured that recipient subcontractor or vendor selections for goods and services represented the best value to the Government. Specifically, for three recipients we reviewed, the Department had not reviewed contracting actions totaling over $4.1 million to ensure that the selections were arm’s-length transactions and did not comprise conflicts of interest. To cite the relevant concerns with the Department’s inaction, we identified transactions totaling over $1.4 million in which one recipient contracted with an affiliated company that had representatives on its own Board of Directors.

Keep in mind that this audit represents an incomplete snapshot. The American Recovery and Reinvestment Act (ARRA) provided $3.4 billion for CCS research; this audit reviewed just one of the DoE programs covering $1.5 billion of the $3.4 allocated. Even then, the OIG sampled just a fraction of the $1.5 billion program; of 46 projects that received funding, they reviewed 15. And even at that level, the review wasn’t complete:

For recipients included in our sample, we judgmentally selected financial transactions to review for questionable costs based upon reviews of recipient files.

In short, their review was limited, but everywhere they looked they found waste, fraud, and/or mismanagement.

Making matters worse, the audit was inspired by previous findings of mismanagement at DoE’s Office of Fossil Fuels:

Previous Office of Inspector General reviews identified weaknesses in the Department’s management of financial assistance awards. For instance, our audit report on Management of Fossil Energy Cooperative Agreements (DOE/IG-0692, July 2005) found that the Department had not always provided adequate monitoring and oversight of cooperative agreements, and Federal project officials had not always taken sufficient action to address project management or financial shortcomings. In response to the report, the Department committed to address the weaknesses highlighted in our report. In light of previous concerns and the significant amount of Recovery Act funding, we initiated this audit to determine whether the Department had effectively and efficiently managed the Carbon Program.

So just how many billions have been wasted chasing the myth of carbon capture and storage? Check back later this month when I’ll have a more complete accounting. For now, however, have a look at the second report, a Congressional Research Service report released three weeks ago:

The U.S. Department of Energy (DOE) has pursued research and development of aspects of the three main steps leading to an integrated CCS system since 1997.1 Congress has appropriated approximately $6 billion in total since FY2008 for CCS research, development, and demonstration (RD&D) at DOE’s Office of Fossil Energy[…]

And what do we have to show for it? (from the same report):

To date, there are no commercial ventures in the United States that capture, transport, and inject industrial-scale quantities of CO2…

This won’t end well..