early investments and develop this. that are continuing, but certainly those incentives were there to spur new technologies. there are incentives -- there were incentives in the airplane industry. whole lots of things in how to help the semiconductor industry. but in the last analysis, i think the most effective programs are ones which tend -- which can guide and stimulate private investment. you know, senators bingaman and murkowski are in favor of a loan program, but in addition to that there are other things we can do to which can actually again just help guide those investment

choices. mostly what we want to do in my opinion what we'd like to do is guide the investment choices that could really stimulate high-technology manufacturing in the united states. that's no reason why we cannot be competitive with any country in the world. germany is competitive in high-tech manufacturing and i believe they have higher labor costs than we do and we're at least as innovative and inventive as any country in the world. i would say more so. >> but my only response would be that the market makes a better decision making process based on the record and it's not the taxpayers' money that's at stake, but i think that's the way it ought to be. secondly, the historical comparison made might not work now because we weren't drowning in debt when they were made. today we're drowning in debt and

we can't keep going. having headlines that half a billion dollars are lost to the taxpayer. my time is more than expired, mr. chairman. thank you. >> senator stabenow. >> thank you, mr. chairman. first, welcome, secretary chu. let me just indicate first that i appreciate the efforts in working with us on a clean energy manufacturing strategy. it's clearly leading the recovery for the country and our efforts -- the chairman and i championing the advanced manufacturing tax credit, 48-c and the loan program that you mentioned where ford is bringing jobs back from mexico because of their efforts around advanced retooling and we are seeing jobs coming back from a number of countries because we're focused there. i would encourage you to continue that and use the tools available. i want to talk specifically today though about a very, very important project i believe for the country and certainly for michigan and that's the facility

for where isotope beam projects, that they won in a rigorous competition a number of years ago. and they're a critical point. we're coming into the fifth year of funding on this national project. it's a core piece of our research for the united states research infrastructure with broad benefits to science, medicine, industry. and not only would it provide the next generation of nuclear physics work for us, but it will create jobs and address our u.s. competitiveness and job security. we have to move forward. if we don't, other nations will and they'll be attracting the best and the brightest and not the united states. as you know, i have talked to you numerous times about this, as have my colleagues in michigan. you have heard from the

scientific community. i'd like to hear from you today what is the department of energy's level of commitment to this project? >> well, senator, yes, you have certainly talked to me many times and i think with the entire michigan delegation it feels. we agree with you that efrid is a worthy scientific project and what we're trying to do is try to figure it within the constraints of the nuclear physics budget, in the office of science, how to best appropriate all of the precious dollars. so the question is precisely that. and ultimately, it's going to be the nuclear physics community that will be deciding what to do. so it's not targeted at -- it's targeted a at the entire nuclear physics program. we think nuclear physics as is high energy physics are important parts of the department of energy portfolio,

but the budget has said that we have constraints. we also need to use our budget in the office of science to help on the mission oriented research that could lead to energy solutions and lead to more competitive america in the near term. so we recognize the value of the michigan state project. we've asked for a budget that's the same level as was appropriated last year and we will continue this. but in the end, we need -- you know, the nuclear physics community writ large to comment in all the projects, not only the projects, but the program in general. >> well, mr. secretary, let me ask you though to clarify this, because the president has indicated support for this in his budget. it's not the level that will allow them to proceed as they have been planning to be able to

break ground this year which is critically important. again, this is going into the fifth year of commitment in the united states on this particular project. they have been through numerous reviews and competitive reviews and in fact have come out with stellar recommendations in their past. and so i'm very concerned that what you're now calling another review process and whether this is just an effort to slow down or stop progress on this incredibly important project. so can you describe the review process and how does this fit with the fact that there is in fact a commitment in the president's budget to continue this? >> well, the fact that there is a commitment in the project means precisely what you just said. we're not prepared to abandon this project. the review will not be the review of just this. i want to make that clear. we have three large projects but

we have a large nuclear physics program as well. and within the constraints of our budget we need the nuclear physics community to tell us what they value the most. and so -- this panel review is not going to affect what happens in the fy-13. >> and so it's not affecting what's happening in fy-13, and so that means the project and the funding moves forward for this year? >> well, i think we have an amount in fy-12 and we requested -- it depends on what congress does, but we have requested the same amount for fy-13. that was appropriated -- >> so for the record and as a member of the budget committee and moving forward with appropriations committee, it's my intent to make sure that we do everything possible to make sure they have the full commitment to be able to move forward with this project.

i hope that the department is going to keep its commitment going into the fifth year of a very important not only science project, but economic development project that's going to create over $1 billion in economic activity and makes no sense to me why as we go into fifth year that we're having this conversation when those conversation were conducted at the very beginning of all of this and priorities were set, decisions were made. dollars were spent. and now we go into the fifth year. it's in the budget. it seems to me we ought to be talking about what we need to have -- to break ground and to be able to move forward with this rather than another evaluati evaluation. i'm all for evaluation, but this project has been evaluated and in fact has come out a stellar reviews at every step of the way. i would hope that the department would keep its commitment.

thank you, mr. chairman. >> senator paul? >> secretary chu, thank you for coming today. as you know we're in the midst of a great recession with 12 million people out of work. i'm very concerned about 1,200 jobs that are in paducah, kentucky. they work for the nuclear enrichment plant there that's been in operation for many years. over 50 years we have accumulated 40,000 cylinders of -- rain -- uranium waste and we'd like to enrich them. if we were able to enrich them, you could save the 1,200 jobs. the 1,200 jobs would be lost this year if the company goes under which is predicted to go under in 12 months if we do not enrich the uranium. i'd like to ask you if you'd

help us with these 1,200 jobs and help us enrich the uranium. >> first, you said this company that's running the paducah plant for them they see -- it's going to be a business decision that we are talking about some depleted uranium and whether they'll use the enrichment facility to generate the uranium. and what they are asking for is government assistance to say we have some depleted uranium, we can give it to them and them enrich it. and certainly you're very concerned about the jobs, but we are also concerned of a number of other things. because in order to provide the funds to allow this to go forward, we would, for example, be using -- we would have to be essentially putting some of o oour

uranium that we have on the open market. we have to do this very carefully because we have a commitment that any use of our uranium, u.s. owned uranium might have an effect on the uranium markets that would affect the miners. >> but if we allow this to happen it doesn't cost the taxpayer anything because the proceeds for enriching it coming out of the proceeds of the sale of the uranium. >> it does but you have to take that a little further because the market for uranium has changed after fukishima as you know. the germans have decided to bring down the reactors for

quickly so the market has changed over the years. >> but could you not increase your stockpile and then sell it over time? >> well, the way we see it, this is a complex process. we're going to be giving -- we'll be using taxpayer money to pay for the services. that will keep the paducah plant running. in the end, if there's -- let's just pose there's a glut on the market of the uranium. you have to separate the uranium. the value is not as high. then in the end the taxpayer has to foot that bill. so the analysis of for example the cbo's office says this is not a moneymaker. in fact, it could be a big liability so we have to work through all those things. >> the gao says it has a value of $4 billion, that would be returned to the taxpayer if we were to enrich it. you've got a lot of problems here. we have 50 years of waste and we're providing you with an

alternative that brings money back to the treasury and helps you get rid of a waste problem. i think we have 700 tons of uranium sitting on the ground. i mean, many of the administration say you're a green administration. we're giving you a chance here to save jobs. not on is only kind of loan program and recycle something and cut the amount of uranium waste in half. situation for the taxpayer. i'm not a big fan of expending

new taxpayer dollars, but the taxpayer dollars come out of the sales of the uranium. if we were to temporarily raise the limit which i think you're allowed to do so, which is under your discretion, we're talking about 1% of the world market. i don't think we're talking about affecting the price in a large degree. >> in closing, first, the gao report came out several years ago before fukishima and we're still trying to figure it to what extent they're starting their reactors. i would be surprised if their analysis of three years ago would be the same as -- >> there's a brand new one. june 13, 2011. nuclear material, the depleted tails could be a source of revenue for the government and that's talking about $4 billion

worth of -- >> well, i would be happy to spend some time with you, be happy to meet with you as i indicated in the letter. >> i wanted to be said for the record that these 1,200 jobs are 1,200 jobs you could save with the stroke of the pen if you chose to do so. this isn't billions of dollars being spent on something where we might get jobs and we haven't. we have lost it. these are 1,200 existing jobs in a long-standing nuclear trade. there are defense considerations, uranium is not a purely open market. there are strict controls on this market. so i think it's something where the government could do something that cost no money. the 1,200 families are listening to you today and they know you have it in your power to save their jobs. it doesn't cost the taxpayer anything because the proceeds

come out of the uranium. >> again, senator, i'd love to talk to you at length about this, we fought deeply. but it could -- we also see a potential hundreds of millions of dollars of liability in the future and we have to work through that as well. >> senator cantwell? >> thank you. secretary chu, thank you for visiting the hanford site and obviously you know it is one of the most complex and largest contaminated sites in the world. and our concerns about making sure we continue to get clean-up done in a timely fashion is of critical importance. not just to this state of washington, but to the nation. are you confident with this level of funding that we will have that plant open and operational in 2019? >> senator, again, within the

budget constraints we are working hard to keep the environmental management budget down a fraction of a percent, but essentially flat and we are trying very hard to make some tough decisions there as a protection of the columbia river, the waste plant, the tanks and wtp. so first we feel we'll meet all our legal obligations with this budget. but as you know, i spoke to you about this, that there was an ideal funding profile for the completion of the wtp plant would call for more aggressive spending this year, next year and the following years so that you just like in a commercial building when you build a building you don't mess around. if you got it engineered, you build it very quickly.

that funding profile is not in the cards anymore because of our budgets, and so because of that, we know that there's a risk, that could slip the schedule. but on the flip side we are a o also -- we have to prioritize and we have to make sure that the waste tank farms are cared for as well. so it's a tough decision, and as you well know we take these responsibilities very seriously. >> so 2019, that's your -- >> well, we can't say right now, but because there's -- we are working through some of the issues. we have a program for testing, for example, the so-called jet mixing, things of that nature. perhaps two or three years ago we felt that -- we have determined with the defense and

others that it would be prudent to go through a more comprehensive testing. so we acknowledge that. and so these are some of the issues, on this very, very complex project. this is in my mind the most complex nuclear project the world has undertaken, let alone in the united states. >> i couldn't agree more and that's why, you know, when some of the questions have been raised about the plant, do you think we have the right oversight on the issues that have been brought up by whistle-blowers? because obviously once the plant goes operational, you can't fix any, you know, it's too hot to fix the issues. >> i think we have worked very hard, both the deputy secretary and i have worked hard to make sure that we have essentially a-team in place and the direct oversight of the -- of the

contractors, dale knuteson is an outstanding project manager. he's a long track record. we were age to talk him into it. and we have a lot of respect for them. and david hyzinga, a superb manager person -- so all the way up and down the chain we are putting in place what we believe is a very good team. and because of the importance of this project, a lot of these discussions go right into my office. i have spoken to the coo of the head contractor, probably four times in my office. on making sure that he too has an a-team as a contractor and from my discussions with the

people on the ground they say that becktell has been doing their job in trying to get the right people there. >> thank you for that level of detail because i think it's what it takes. you should make the secretary of energy for life or until hanford is cleaned up so we don't change horses in the midstream. can we dispose of military waste first? we don't want hanford to be a de facto site for 90% of the site. the blue ribbon committee was here, and senator wyden talked about this and whether it would be a great place for a site. do you have an answer for this?

>> we'll keep separate the civilian and the nuclear waste sites. we are considering -- i'm not sure where in the status of -- but the whip, first, it's for low-level radioactive waste. and so one would need to do some studies to make sure that that would be safe for the high level waste. and so we need to do something along those lines. but i'm glad you pointed out whip, because this is a success story. it's been there operating for about a dozen years. there have been no incidents. the local people are -- they feel confident we're running this in a very safe way and it's -- it's good for the local economy. good for the economy, the state of new mexico and so again, this is something where which can show that we can develop repositories for nuclear waste.

which as the acceptance of the local people. >> if i could follow up on that, i'd appreciate it. and as the clean-up goes on, shifting over acreage to the local community there for energy parks in general. i think it's a proposal that's moving its way through. thank you, mr. chairman. >> thank you. senator risch? >> thank you. secretary chu, let me say for the record that -- and i know that this falls on deaf ears and this is simply a philosophical agreement, it decrees the nuclear energy come point by -- component by 10%. i find that particularly discouraging as we look to the

future. i know that's not the administration's position that nuclear is our fposition and i suppose that's not going to change until the administration changes. take my objection to the decrease and we'll increase the other boutique type of energy production systems that you have. i want to ask particularly about one part of that. i noticed that in the budget you increased -- or you decreased the fuel cycle research and development by 10.8%. and yet, yesterday when you were in georgia you announced that there was going to be a new $10 million advanced nuclear innovative cross cutting for cross cutting and soon to be a little inconsistent. on one hand, you're asking for the -- for a $10.8 million decrease and yet yesterday you said there was going to be new funding.

what is this new funding? i didn't quite -- that came out kind of gray. >> okay. so in the first -- i have been very supportive of nuclear since i walked. >> i understand that. but i also caunderstand you're carrying the administration's water. >> in terms of the fuel cycle, we believe that first as -- as pointed out, that the technologies for fuel recycling today, we don't think are economically viable and nonproliferation resistant. there are other examples of -- so this is the purest methods that the u.s. developed actually. but as we have seen from both --

especially in the japanese experience, that's well over budget. they believe it was a $6 billion investment. it's north of the $22 billion today. there are other technologies like pyroprocessing. which we think have promise. they had good laboratory experiences and then we went up and did the next step and it didn't quite work as well as we thought it would. in order to be -- it is more proliferation -- it's not proliferation, but more proliferation resistant. had that worked well we would have been encouraged. it's not to say we're going to ab abandon that. i'm personally interested in why it's not working, so in my spare time i'm trying to figure out if i can help them. >> you may resolve that. >> it will be up here. i don't think the nric would

like me experimenting in my garage. it doesn't open -- it still doesn't mean we shouldn't be locking for other -- looking for other good ideas because we are very interested in if nuclear is going to be part of this century's mix. we would like to not use 1% of the fuel. energy content of the fuel to generate a certain amount if we can use 20%. 20 times more. so you have a similar -- you have 20 times more electricity. so this is hanging out there. >> and we're all in agreement on that. >> so we do feel that it does make sense to invest in new technologies. we're going to have to come back a little bit and try to figure out why some of these earlier things that the lab scale doesn't go into the minipilot scale. >> the one question i had why

was this announcement made in georgia, because it's a strong mission, the actual work that you have described. >> well, i happen to be in georgia and, you know, i -- yes, it can be only two -- i can only be in two places to be once. so that's georgia and oak ridge. >> so i can take the message back to the idaho people that this $10 million is coming? >> oh, we announced competitive bids and idaho is free to compete with that money. >> mr. secretary, my time is up, but you and i had a discussion at your confirmation hearing about the contract for clean-up at the idaho national laboratory. you weren't familiar with that, but promised to get up to speed on that. i have some questions about that. from the budget which is really not very clear as to where we're headed with that. if you'll take those questions for the record i'd appreciate

it. thank you, mr. chairman. >> thank you, senator udall? >> good morning, mr. secretary. i can speak for senator risch, i know he'd volunteer his garage if you need it. i know he represents iral and i represent inral. i want to continue to work with you to see if their good work continues. your budget in my estimation you go a long way towards supporting that lab's critical programs, which are focused on developing innovative renewable technologies. that clearly have translated into lasting, well-paying jobs. more comprehensive energy portfolio and the national security and kudos to you. i know this is a tough fiscal environment and i want you to know that we support what you and the president have put together. i