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Monday, March 20, 2017

ANALYSIS/OPINION:

“It’s better to do a few things well than to do many things poorly.” Such sayings become commonplace for a reason: They ring true.


Bakers can make great doughnuts, but that doesn’t mean they’ll excel at making other circular products with a hole in the middle. Fresh-from-the-oven car tires and wedding rings might not be what consumers want.

Energy Secretary Rick Perry must be feeling like the newly hired bakery manager who finds his display cases filled with doughy tires, rings and Life Savers. The Department of Energy is trying to do too many things, and doing them poorly. Dabbling too much in energy technologies and markets more appropriately left to the private sector has distracted the Energy Department from its core, legitimate government responsibilities.

The department manages programs for nearly every energy technology under the sun — including the sun. We’re talking biofuels, small nuclear reactors, smart-grid technologies, carbon capture for coal plants, battery storage, solar energy, new drilling techniques and many more.

Lawmakers, Republicans and Democrats alike have stuffed the department with loan programs, R&D programs and commercialization initiatives — all in the name of helping birth the next big breakthrough in clean, renewable energy.

While the department doggedly pursues politically preferred technologies, it is also trying to keep up with its responsibilities to maintain America’s nuclear weapons complex and to clean up the facilities where those weapons were manufactured and tested decades ago.

Unsurprisingly, with so many assignments on its plate, the Energy Department has struggled to do any of them well. And taxpayers have paid a pretty penny for the department’s distraction.

The department continues to miss environmental cleanup deadlines agreed upon with states that house radioactive waste and facilities used to test and manufacture America’s nuclear deterrent during World War II and the Cold War. The current taxpayer liability for environmental cleanup and disposal is estimated to be nearly $340 billion.

The National Nuclear Security Administration, the body within the Energy Department charged with maintaining the nuclear weapons complex, is plagued by underfunding along with morale, recruitment and leadership problems.

Taxpayers are also out over $6.1 billion to cover settlements with the nuclear energy industry for the department’s failure to collect and store nuclear waste as the law required it start doing by 1998.

These are the very functions Secretary Perry and his department should be focused on. But for too long, the department has been distracted by those energy technology activities that put it in direct competition with the private sector.

Unsurprisingly, there are poor results there as well. When the DOE carries a company from infancy to market, it makes for a nice, feel-good ribbon-cutting story. But what about that company’s competitors, the ones who didn’t “win” a government grant or subsidy or guaranteed loan? Lacking the government’s full faith and credit, they find it harder to attract private capital because, even though they may have a more promising technology, they appear to be a riskier investment.

Put another way: When the Energy Department intervenes in the market through loan programs, research, development and commercialization, it squashes entrepreneurs who don’t get government subsidies.

This is doubly deleterious because the market — businesses, universities, entrepreneurs — does a better job of identifying consumer needs and how best to meet them.

So, what should Mr. Perry do now that he finds himself at the helm of a sprawling, widely diversified, $29 billion enterprise? Do a few things and do them well, set priorities and reduce or eliminate distractions.

The department should reset its focus and concentrate on three critical objectives: maintaining the nuclear weapons complex, efficiently addressing environmental cleanup, and ceasing its wasteful and disruptive intervention in energy markets.

Katie Tubb is a policy analyst in The Heritage Foundation’s Center for Free Markets and Regulatory Reform. Nicolas D. Loris is the think tank’s Herbert and Joyce Morgan Research Fellow in Energy and Environmental Policy.


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