but i'll leave that for another point. all the major activity has been in the engineering and frontier research centers. i guess we have 46 of those. those have been standing for a couple of years now. do you have an ongoing program for oversight or measuring what the output of those centers is at this point, or is it -- >> yes. we're starting a very thorough review of the effectiveness of the so-called erocs, and very rigorous analyses of how to evaluate them based on outside scientific referees to see how each one is doing. because we want to make sure that the ones that are working very effectively we'd like to continue, the ones that are not we're going to have some discussion. >> what is a fair period of time to begin to account --

>> well, every year they're reviewed. but i think in this next review, it's a much more thorough review, so then you step back and look over the next couple of years. but every year. >> if they were established in '09, they could not have been functioning effectively at all until probably late '10. >> that's right. so we're about two years into this. i think some of them started in middle '08. let's say '09-'10 and' '11. >> are the hubs also standing or are they more recent? >> they're more recent, except for the three hubs that are the energy biocenters. those were actually the pro prototypes of what we had.

>> the energy research centers? frontier energy research centers? >> yeah, six or seven -- about the same time, roughly, maybe a little earlier. i think the bioresearch centers, again, i can get you the details, may have come a year or so before that. >> you were asking for an additional hub. there were five of them standing and you're asking for a sixth one? and in your testimony, you said electricity systems. can you tell me what you mean by electricity systems? >> well, if you look at the electricity system in the united states, it's a very complex organism, if you will, and -- >> it's a delivery system? >> it's a transmission and distribution system. it's the delivery system, it's the control of the flows of electricity, it's how do you -- as you work to go to a modern grid that you can control how

you flow the electricity and you want to look at where there are potential vulnerabilities in the grid. >> would that hub be responsible for trying to figure out how to reduce greatly the loss of power over distance? the delivery of power in a much more efficient manner? >> that wouldn't be -- >> mr. secretary, if maybe you could summarize that question. i want to get everybody in here before we blow the whistle for votes. >> i'll give you the details, but that's not the central focus, it's more distribution and control. >> mr. rodney alexander. >> thank you, mr. secretary. the president's budget includes an inter-agency study that says the department of energy, epa and usgs are partnering to study

the environmental and health effects of hydraulic manufacturing. can you tell us a little bit about what that might lead us to? >> well, as you know, the president asked us to set up a subcommittee to look at hydraulic manufacturing, and i think the concludsions of that subcommittee report were that we believe hydraulic manufacturing can be done in an environmentally responsible way so that you can take advantage of this great resource, and it creates jobs. we think it's a very important fuel mix and a transition that we will be needing in this century. and so what we believe we have in the department of energy, and it's also work ving very closel with the usgs, we have a lot of expertise in how fluid moves in

rock, and how do you develop it so that we can help industry know what is happening and develop this resource in an environmentally responsible way. >> how much time are we talking? the president, in his state of the eunion address, said the government has been investing in shale refraction research in the last 40 years. how much more do we need to study it? >> what the president was referring to in that case was from about 1978 to '92, the department of energy invested in horizontal drilling and hydraulic manufacturing at a time when industry wasn't really interested in that. when industry began to pick it up in a real way, the u.s. government had gotten out of debt. since that time, and it's been the story that then the development of shale gas and shale oil has been quite remarkable in the last half dozen years. but there are also -- there's active environmental concern,

there are reports on emissions, things of that nature, so the research we're now wanting to do in the department of energy and usgs is, all right, first, what's really happening? and secondly, how do you keep on advancing best practices because we improve on virtually everything we do going forward, and as i said, how could our research help in developing and improving the practices that are more focused on making sure that the water tables aren't contaminated, things of that nature? >> is the administration looking for a way or a reason to shut down fracturing? >> no. >> thank you. >> thank you, mr. alexander. mr. womack, thank you for your patience down there. >> thank you. happy birthday, happy

anniversary, and my complements to the secretary for his comments at the er summit. and my complements to shundar who is hosting the event. i want to stay on the natural gas subject for just a moment. i'm troubled by the fact that when you look at the budget numbers, a little over $2 billion in renewable energy request, and if i'm reading the numbers correctly, we're looking at just a few million dollars on the subject of natural gas, and as was indicated in that previous round of questioning, that money is dedicated, i think, to, if i heard correctly, to determining whether or not -- you said it's got promise, but to make sure that we're not doing something environmentally. so can you help me?

i know those numbers -- that's a wide range, and the numbers from the information agency suggest that natural gas use by 2035 will be equal to all the rene renewables put together, so those numbers just don't match to me. help me out with that. >> sure. let's look at all our energy, including transportation energy, which is roughly 30% of our energy, and how much the united states spends on either oil created domestically or oil produced imported, that's probably on the order of $100 billion a year. our energy budget is not commensurate to how much we spend on oil, because oil is the very mature technology, it's

going very well. the budgets we would spend on oil would be having to do with helping improve safety and helping improve technologies in regard to the, for example, the border drilling. so one shouldn't really look at the budget in relation to what we are spending as a country, but where -- and this is how we try to make these decisions. we try to invest in areas which are younger earlier. technology, we are investing, for example, a small amount of money but an important amount of money in seeing whether methane hydrates can be developed. again, because industry hasn't really decided whether this is going to be something, so exactly what the department did in the late '70s and '80s. but -- so what we try to do is

invest in things where we think the taxpayers have the most len leverage and can push the technologies forward in these various areas. >> speaking of leveraging, we got kind of a chicken and an egg. i want to go to natural gas as a mobility fuel now. and i listened with a lot of interest to mr. fred smith this morning from fedex on the use of gas, natural gas, in their fleet. there seems -- and in my district, with the arcoma basin, the shale, and the things happening throughout our country, there seems to be a growing demand for compressed natural gas as a mobility fuel. however, chicken and egg, we don't have the infrastructure to support it. so how is doe involved in helping us get to the level

where that readily available resource can be put to good use? >> right. excellent question. first, i agree completely with fred smith about his assessment of liquefied natural gas and heavy trucking. a couple hundred filling stations on a major interstate, and that's a significant part of our transportation energy use, it's 20%. you can offset a lot of that. we looked at the numbers. it looked very promising. payback period something on the order of three or four years to foreign investment in a more expensive truck. the filling stations, the private sectors getting behind and investing hundreds of millions of dollars. so the heavy trucking, we think this is a great way to diversify our energy supply. when you go to a delivery van and when you go to a personal

vehicle, different. because you can't have filling up every 200 miles, you need a lot more. so we think it is a solution, however, we need a better source. you either have a very expensive tank at a very high pressure, a hydrocarbon tank, or you have a very heavy tank, which is really not an option, like a scuba tank. what we have done to look at this is the best thing we feel the department of energy can do, and we're putting out this announcement to fund the opportunity, is to do two types of research. one, to decrease the tank costs. so it's not an additional one quarter to one-third extra in the vehicle, so you can use compressed natural gas, which we have more readily available infrastructure. and the other is to actually look at research where you can

have the gas absorbed in a material in the tank. so you have the same storage capacity. >> i'm sorry to interrupt here. if you could just finish your sentence. >> again, it's a technology exclusion. if we di need a lot more and we would be very thrilled by that. >> mr. nunley, thank you for your patience. you're the end of the line here. >> thank you, mr. chairman. thank you, secretary, for being here. before you were nominated, you were quoted as saying, quote, somehow we have to figure out how to boost the price of gasoline to the levels in europe. i can't look at motivations, i have to look at results. under this administration, the price of gasoline is doubled. while bumping $4 a gallon in north mississippi, today the price of gasoline in europe was about $8 a gallon. and the people of north

mississippi can't be here, so i have to be here and be their voice for them. and i have to tell you that $8 a gallon gasoline makes them afraid. it's a cruel tax on the people of north mississippi as they try to go back and forth to work. it's a cloud hanging over economic development and job creation. and it appears to me this administration continues to drag its feet on oil exploration or possible fuel development and recovery. how do you respond to that? >> well, i think -- absolutely we should be judged on what we are doing, and i should be judged on my track record when i became secretary of energy. and when this administration started, we were in a freefall and a recession. and the price had plunged from roughly $140 a gallon down to -- barrel, $140 a barrel down to about $40 a barrel. and we -- and the solution to

this -- i mean, we will do everything -- and we agree that the price of gas is suffering. we are very concerned about this, and in the department of energy, what we are trying to do is diversify our energies via transportation so we have cost-effective means. natural gas is great, so we're pushing on natural gas for transportation. electr electrification is great. we've had some pretty spectacular breaktl dbreakthrou that was announced yesterday, that at least looks like it will decrease these barriers maybe

twofold. continuing again to diversify the transportation fuel. so these are the things we're doing, and we're very focused on that because we understand the economic impacts it has on all americans and our economy. >> but is the overall goal to get our price? >> no, the overall goal is to decrease our dependency on oil, to build and strengthen our economy and to decrease our dependency on oil. for the first time in the last eight years through a lot of policy, this previous administration, you know, our oil production has increased for the first time. it's at the highest level in eight years. it's the import. the fracture level is at it highest in 18 years. we think if you include all these policies, including air efficiency, we think we can go a long way to becoming less dependent on oil and

diversifying our supply and it will help the american supply and the consumers. >> thank you. >> thank you for not only putting a human face on what a lot of american families are feeling at the pump and with their own family budget. mr. skolovsky. >> thank you. i just want to read three questions for the record that i have particular interest in. one is the issue of the safety culture at the waste treatment facility. there was a d.o.e. office of health and safety security investigation last year and they report very concerned about a systemic problem that continues to persist, and i have an interest in that question. relative to usac, there was an agreement between the department and usac as well as in return to

services. the question i have is what happens to the government long term for those tailings? i'll strip the $44 million of liability. do the taxpayers pick that up or does usac pick up that liability? i also notice they're looking for transportation authority for $106 million, but i want to know where the $106 million is being transferred from, and i appreciate the chairman's indulgence. >> let me share my feelings with mr. visclosd drkvisclosky. there are a number of outstanding questions, not the least of which you still have $550 million notwithstanding the terms of the 705 loan guarantee money. you just have to believe that's the amount. a lot of that money went out in the waning months of the

program's authority, and you, you know, personally approved of that. can you sort of give the committee some assurances that that money and the programs it went to have better oversights than perhaps some of the other programs that were initiated? >> how would like to characterize -- there were some lessons learned. >> well, there are always lessons learned in life, and certainly as noted in my senate testimony, we are continuing to improve how we administer the loan. but i wouldn't characterize -- in the end, we were very careful how we test, so i think you're talking about the conditional loans and that obligation. >> yes, and how are you monitoring? >> right. so what we have been doing

since, i think, 2010, mid-2010, setting up a different section within the loan program but also with outside eyes within the department of energy to look for rapt changes in anything that materially would affect the company and the environment the company is in. so it's not only -- certainly if you look at the loan agreements that we have, there are very careful milestones the company has before the next part is metered out. but in addition to that, as noted in the cylinder case, there was a very, very rapid change in the whole ecosystem. the price dropped by roughly 80% in three years, one quarter to one-fifth of what the solar month modules are doing. when that happened, there was very rapid technology occurring

during that time and continued to develop. the bad news is that not all companies are -- >> are you laying blame for that disaster on things that occurred in china? how about oversight of -- >> i'm saying that when prices vary that much in a commodity product that a lot of companies can be swept up by that. >> well, that's all the more reason for oversight -- >> i agree with you. >> -- to the point of my question -- >> i agree completely. >> we are continuing to monitor what was approved. >> right. and as the economic and the business changes, if there is that -- effectively something like that happened, we have to be very, very conscious of that, and we monitor these things very, very closely. and so -- >> we're counting on you, and obviously, i think a lot of the

public confidence issues that i mentioned in my initial opening statement rests on the type of assurances you're giving us this afternoon. this is your lucky day. this is your birthday and your wedding anniversary, and we have some votes which means we will not reconvene, but we have a lot of questions for the record, and we hope that we can get responses back in good order. we look forward to cooperation from your staff in that regard, and if i may say for the record, if members have any additional questions, i think they have a recquisite 24 hours to get them in to be submitted to the department of energy. so mr. secretary, on behalf of mr. viskofky and the committee, we thank you and your staff at this time. >> thank you. >> we stand adjourned.

even a person who is a senator, even a person now who is president of the united states faces a predicament when they talk about race. they face all sorts of pre did a predicaments. they deny that people are afraid of race, even now. >> the rhodes scholar is the author of five books and he'll take your comments, calls and tweets for five hours. now a panel of ceos on what

companies need to do to compete globally. you'll hear from the heads of archer daniel midland, airbus and alcoa. from the economic air forum in switzerland, this is a little more than an hour. good morning, ladies and gentlemen. it's a great pleasure to have this panel and to have you with us this morning. we have a great group of business leaders talking about the global contacts. let me just briefly introduce them. we have the bus consulting group, and then we have john chambe chambers, chairman and ceo of cisco. tom of airbus. chairman and ceo of alcoa.

the ceo of new york stock exchange. the and last but not least, patricia wirtz, the president and chairman of -- we will talk about the global business context, and i ask the different businesses about their perspective about how they do in this very difficult business environme environment. the opportunities, the challenges, and what are the key changes in their strategies, their operations, in order to make it work. as my colleagues are in their quiet periods, they will public results for the last quarter and last year in a few days' time, in two weeks' time. they will have to avoid any specific questions on their

specific results, and i hope you'll bear with us. so we'll start with a series of opening remarks, then have a discussion within the group about key opportunities and challenges, and the third part of the discussion, we'll open it up to questions from the audience. and i would like to start with klaus. have you a perspective on your specific business and the world? >> yeah, i think when this panel was put together, the big question was, as always, how do you all have to reshape your business, and frankly, i think there are a couple of new things that have come out more strongly, but there are also a couple of things that we have to remind ourselves of to not forget. and i would start with that one, which i would call the neutral north, and it hasn't changed at all. i've always talked about the megatrends, and they continue. they continue to set the

undertone. we will have 3.5 billion people on this earth very soon, a lot of them will live in environments that will change drastically, we have the middle class. that is still there and will be there for, i would say, at least the next 20 years, but it is important for companies and leaders to adjust to that. i mean, you have to look at those markets, that you are present in those markets, expand in those markets, and for us, it's not just the end customer of markets, but it's how are the markets changing in supply for us. i'm talking about energy here. this is the neutral north, and i believe it's still there. it's there as it was there last year, but we have to remind ourselves of this and build it into all decisions. what's new? what is new in my view is we live in a 25/8 world. i'm saying that a little tongue

in cheek because i don't know how you feel, but talking to some of my colleagues, i feel that isn't enough to cope with what's going on here. especially the news coming in, and they've given pretty much everyone in their private room, no matter how small it is, access to their rooms, and they can absolutely change the world. that's true in every environment. it's true for politicians as we've seen from last year, but i think it's equally true as we've seen in small businesses. i don't think we can grasp that point in time. we can grasp some of these states. i don't think we have a real strategy around it, but i think we can graph some of these things. in my view, at 25/8 you can't fake. because in a way, it's going to come out, you just don't know how. you saw it last year, wikileaks has set up a new norm in this regard for the things that could come out. we have to live with that, and the question it brings back is,

you literally have to, wherever you go, you have to earn your license to operate. and you do it in two actions. it brings the fundamentals back, and i think you cannot believe that if you have an issue somewhere, you can brush it over and be nice and move on. i think if the fundamentals are problematic, they will come out. you have to work very closely with your customers, with your employees, have a very active communication policy around it, and literally make sure that society understands how do you add value? it starts with simple things. if your employees don't believe you are adding value, i think you've lost the battle. if your customers don't speak positively about you, you've lost the battle. so the other thing that's new, and we saw it very painfully last year, is the volatility. the volatility that we see throughout the world, metal price went up by 28% last year.