[To view the DOD Operational Energy Strategy, go to http://energy.defense.gov and click “Report to Congress: Operational Energy Strategy.”]
MR. LYNN: Well, thank you all for joining us today. I’m pleased to be here with Sharon Burke, our assistant secretary for operational energy. Today we’re releasing the department’s first-ever Operational Energy Strategy: Energy for the Warfighter.
And before turning the podium over to Sharon, I’d like to say a few words about the importance of energy to our national security mission. As you know, Secretary Gates and I have been consistent in speaking about the need to better manage the defense enterprise, to adapt our forces to emerging threats and to sustain a strong and capable military. Our use of energy cuts across each of these issues. It affects military planners, acquisition managers and the warfighter alike. The way we build energy into our operations is a core part of fighting and winning the nation’s wars.
As a department, we account for 80 percent of the federal government’s energy use, and about 1 percent of total consumption nationwide. Last year alone we spent $15 billion on energy. Three-fourths of that, over $13 billion, was on energy for military operation, or what we call operational energy.
Our expenditures on energy are way up. With increasing volatility in energy markets and the tightening of global supplies, we are spending 225 percent more on gasoline than we did just a decade ago. The money we spend on energy not only cost the task -- the taxpayer, it costs the warfighter. A dollar spent on energy costs is a dollar not spent on other war-fighting priorities.
There’s also a clear connection between innovation and energy technology and the ability to project military power. This connection is not just about dollars but about military effectiveness. Whether it is deploying and sustaining our forces at the front or powering the mission-critical facilities they depend on in the rear, everything we do, every mission we perform, requires significant amounts of energy.
Ensuring our forces have access to the energy they need, when they need it, is not easy. Our forces in Afghanistan and Iraq have a long logistical tail. Nearly 80 percent of land convoys in Afghanistan are used for fuel. We haul these supplies along roads that are laced with IEDs and prone to ambush. Insurgents attacked 1,100 convoys in 2010 alone.
The threats to our supply lines reflect how the nature of war is changing. Rather than confronting our forces head-on, adversaries are increasingly employing asymmetric tactics. And energy can be a soft target. Whether it is IED attacks employed against supply convoys in theater or cyber attacks aimed at our critical infrastructure here at home, our ability to sustain military operations is increasingly threatened.
Looking to the future, the proliferation of anti-access capabilities will turn many areas previously considered sanctuaries into contested battle spaces. These new threats make energy even more important. The less of it we need, the more operationally resilient we will be.
The nature of war is also changing in a second way. Conflict is evolving from a focus on intense but short periods of combat that end decisively to longer, more drawn-out engagements.
As conflicts become longer in duration and more expeditionary in nature, the amount of fuel it takes to keep forces in the field has become a significant vulnerability. Taken together, the risks and costs associated with our energy use mean that we must change the way we manage energy on the battlefield and strive to reduce demand at all levels of our forces. Addressing this challenge is the goal of our operational energy strategy.
In short, DOD needs to address energy needs as a broad military challenge. Supply is limited, cost is increasing. And with the changing nature of war, our current energy technology is not optimized for the battlefield of today or tomorrow.
To attack this challenge, Sharon and her team have devised a policy approach that increases the energy efficiency of our operations, limits the risks our forces face as they use, transport and store energy, and minimizes the amount of defense dollars we spend consuming energy.
This strategy is good for both taxpayers and warfighters, and it is long overdue. By reducing demand, expanding and securing supply, and integrating energy security into our future force, we will not only increase our military effectiveness, but we will lower our costs. We will also better align the department with our national goal of energy efficiency, and ultimately, energy interdependent -- independence.
Thank you. Let me now turn to Sharon to outline the specifics of the new strategy.
MS. BURKE: Thank you, Secretary Lynn.
Seven years ago, after leading the initial campaigns in Afghanistan and Iraq, General James Mattis called on the Department of Defense to "unleash us from the tether of fuel."
Seven days ago, General David Petraeus echoed that call in a memo to U.S. forces in Afghanistan. Energy is the "lifeblood of our war fighting capabilities," he said, noting that high fuel use means risks for the mission and for each service member and civilian in theater. "We can and we will do better," he directed.
In the years between those two statements, the Department of Defense has, in fact, taken steps to improve our use of energy in military operations. But General Petraeus is right. We can and we will do better, for our deployed forces today and for our forces in the future.
And that’s why we’re here to release "Energy for the Warfighter," the Department of Defense operational energy strategy. You’ll find a document online at energy.defense.gov. And I appreciate the opportunity to stand with Secretary Lynn today and outline the goals of this strategy and the ways the department will meet those goals, and the next steps we will take.
As Secretary Lynn said, every military capability, every mission and every service member needs a steady, reliable supply of energy. Last year that meant the department consumes some 5 billion gallons of fuel. Indeed, the goal of this strategy is to make sure that our forces will continue to have the energy they need to keep the country safe. Meeting that goal requires us to change the way we use energy and the energy we use, and it requires us to change the way we build the future force.
So first, what is new about this strategy? Napoleon once said that an army marches on its stomach. And you might say our military marches on batteries and fuel tanks. It’s not new that logisticians are the unsung heroes of the battle -- of the battlefield. But the amount of energy we consume is new, down to the individual soldier, sailor, airman and Marine.
And while the department has long looked to improve on energy use in military facilities, which my colleague Dorothy Robyn leads for the department, it is new for the department to consider energy as a war fighting capability, something we can change for strategic advantage rather than just provide.
We coordinated this strategy extensively with the military services, but it is also new for the department to give all defense components a common direction to follow on energy. The strategy responds to military leaders and deployed forces, but it is required by law, and that is new too. That requirement was part of the 2009 National Defense Authorization Act, which directed the Department of Defense to establish the Office of Operational Energy Plans and Programs, and President Obama did so one year ago.
Now I’d like to highlight the main points of this strategy. As I said, there are three ways the department will work to improve energy security for the warfighter.
First, we want more fight for less fuel. We need to reduce the demand for energy in military operations. Right now, the volume of fuel U.S. forces consume, whether on the battlefield, in ships afloat, in the air or even in cyberspace raises our risks and our costs and hampers our capabilities.
Conversely, reducing the demand for energy can mean better range and better endurance for our deployed forces. The department will therefore take steps to improve the efficiency our energy use, both through technological innovation and nonmateriel changes. This will range from more efficient engines on aircraft, ships and vehicles to lighter materials, to concepts of operation that conserve fuel. An important first step will be collecting better data and analysis on our actual energy use.
Second, we want more options and less risk. We need to expand and secure the supply of energy to military operations. Right now the department relies heavily on petroleum-based fuels for forward deployments. We also support some military operations directly from bases here in the United States, as Secretary Lynn said, which means that we rely largely on the civilian electric grid in some of those missions.
The department will diversify its sources of energy, giving deployed forces a range of supply options. This is especially important at the tactical edge. The Marine Corps’ India 3/5 company, for example, took some patrol bases off the supply lines for fuel and batteries through solar technologies in some of the heaviest fighting in Helmand province earlier this year. They showed what’s possible.
For the long term, the department will take steps to promote the development of alternative fuels for our legacy fleets, and we will do more to protect against a disruption in our supplies, particularly of electricity at fixed installations.
Finally, we want more capability for less cost. We need to build energy security into the future force. Well, right now the department is building force that is more capable, but also requires more energy. And as the secretary pointed out, the broader defense trends suggest that energy, such a large energy use, will continue to offer a target for our adversaries. And the broader energy trends suggest that high and volatile fuel bills will continue along with the geostrategic consequences.
The department will incorporate operational energy security into all stages of strategic planning and force development, from campaign planning to requirements, to acquisitions. This will help us better prepare our forces for these defense and energy trends, and lower our sustainment costs.
My office will play a guidance and oversight role in executing this strategy, and our next step is to release within 90 days an implementation plan with more specific objectives and timelines. In January 2012, I will submit to the secretary of defense a memo certifying or decertifying the defense budget for how well it meets the strategy and implementation plan.
I should note that we publicly released the first budget certification notice last week, which is also on that website, and that looked at the services’ own energy strategies, since the departmental strategy was not yet published.
My office will also engage across the range of defense activities, from playing in war games to promoting innovation, to participating in defense acquisition boards, to supporting current operations.
So just a final word on what we believe success can look like with this strategy: America will have a military that is better able to respond to any challenge or any threat anywhere in the world. Fewer of our men and women in uniform, civilians and contractors will risk their lives moving and guarding fuel. Our military leaders will be able to choose the energy source that best supports their mission.
Our fixed installations will be resilient to power outages, regardless of the reason or the duration. Petroleum will no longer be such a burden on our budget and our strategic choices. And I sincerely hope that in improving the energy security of our armed forces, the department will have made an important contribution to energy security for the whole nation.
So with that, we have time for a few questions for the deputy secretary or for me, and we’re happy to take those questions.
Q: This is a question for Ms. Burke. Tony Bertuca from Inside the Army. Are you comfortable with the Army’s requirements for this current generation of in-development vehicles? Because it seems like those requirements are now set and -- I mean, is it too late to now push fuel efficiency on those programs?
MS. BURKE: There are two programs, the Ground Combat Vehicle and the Joint Light Tactical Vehicle, that are incorporating energy considerations on a pilot basis, since it’s not yet required in the process. And I think it’ll be -- it’ll yield a lot of very interesting insights and practices for how to do that as we go through those acquisitions.
I think there is a lot of opportunities for upgrading -- midlife upgrades of legacy fleets that we have to pay a lot of attention to. And I do think we’ll be looking for ways to get these requirements into new -- these considerations into new acquisition programs.
Q: OK. Mr. Secretary, what is going to be the DoD policy regarding cost of renewable energy? Some of the renewable energy costs more than petroleum or coal-based electricity. So in what instances are you going to say energy security is going to be worth more money or in what instances are you going to go with a cheaper option?
MR. LYNN: Well, as Sharon said, the strategy really has three elements: It’s basically reduce, diversify and plan for the future. And what we need to do -- the thrust of your question -- is we need to balance some of those -- we need to diversify. In some cases there’s going to be an initial cost for that diversification, but there’s an operational benefit down the road, so that we’re going to have to make a judgment in each case: Does the benefit justify the cost? But overall, I think this strategy will lead to reduced costs, not increased costs.
Q: Are you looking for a near-term returns or long-term returns? I mean --
MR. LYNN: We’re looking for both.
I think that there are near-term steps that we’re taking, such as the memo that Sharon cited, that General Petraeus sent out in Afghanistan. I think that those’ll yield operational impacts in a fairly short order. There’s also other parts where we’re planning new systems and planning energy efficiency into those systems. Those obviously are much longer-term impacts.
Q: Craig Whitlock with The Washington Post. To follow up on General Petraeus’ memo, as you know, the warfighters in Afghanistan are getting most of their fuel from risky supply routes, many of them coming through Pakistan. To what degree is his memo and this operational energy strategy you’re talking about a response to those supply lines and in an attempt to reduce dependence on them?
MR. LYNN: Well, I -- it’s -- it is a response to the vulnerability of supply lines in a generic sense, not specifically targeted on one country. But as the study notes, and I noted in my opening comments, the reliance on fuel where 80 percent of the convoys going into Afghanistan are fuel creates a vulnerability in -- particularly in countries like Afghanistan that are landlocked and difficult to reach. But even in other countries in other geographic environments, it’s always going to present a vulnerability for our forces, and the extent that we can reduce our reliance on fuel is going to give us greater operational agility and less strategic vulnerability.
Q: If I could follow up --
MR. LYNN: Sure.
Q: -- the Pakistanis, as you know, there’s a lot of tension politically and diplomatically going back and forth, and occasionally there have been disruptions of those supply routes. Are you confident that the department could continue to keep the war tempo going if those routes through Pakistan were closed off?
MR. LYNN: Well, we have multiple routes to supply Afghanistan. There’s the Pakistani route; there’s the Northern Distribution Network; there’s the Air Bridge. So we -- we’ve tried to set ourselves up so that there isn’t any reliance on any single source for our supplies.
Q: But if one of those was choked off, you feel comfortable then that you’d be able to compensate?
MR. LYNN: Well, that’s the design of the whole strategy.
Q: Mike Evans from the Times. Do you envisage that any part of this new strategy will have an impact between now and 2014 when the campaign in Afghanistan is going to come to an end? Do you -- I mean, OK, we’ve got Marines there with solar panels; do you think there’ll be something much more significant than that that will bring down the cost of the war in Afghanistan? And as a second thing, can I ask also what sort of -- what confidence do you have that you can persuade industry to follow your route and to produce something which will initially cost a lot of money, but obviously require industry to be lined up with it as well?
MS. BURKE: On the question of immediate impact in Afghanistan, if you look at the memo that General Petraeus put out, he was very specific about where the opportunities are in generators and improved distribution of power from generators in shelters. He named several things. And our analysis, we believe that we can rapidly field some improvements in this area and see very quick progress in both in terms of tactical edge improvements, such as those I mentioned that the Marines are doing, but also getting the consumption down at large bases and major bases.
So I do believe -- and we’re looking at some of these things -- we’ll have a payback within just months. So that’s -- you know, the primary goal is to improve capabilities. But in many cases, we also will begin to save money within a matter of months. So yes, I do believe we can make short-term changes there.
And then your second question about industry, I think the deputy secretary should answer that as well because he has a great point of view on that. But I think in some ways it’s no different from anything else. We have a military need or a military requirement and, you know, we identify what it is, and we go to the industry, to other laboratories in the government, for partners to help us execute what we need to get done.
And I think that we have a great track record as a department of being an innovation pull for solving our problems, and that this is a case where it’s the same, where we have some very specific needs and some specific requirements that will help us get our jobs done and that’ll be a powerful pull for industry.
MR. LYNN: Yeah, just to reinforce what Sharon said, I mean, I think the department has a number of tools to influence the energy strategy here. One, we are a significant part of the R&D budget. And so to the extent that we invest in technologies, we have the possibility of bringing them to fruition. And similarly, given the scale of the department, we have enormous power as an early adopter of innovative energy technologies that can -- that ultimately may have broader commercial use.
And then in the more traditional area of the acquisition process, we can write energy efficiency into the requirements for weapons systems and thereby ensure that we are able to develop those things. Industry just responds to the requirements we put out in terms of the systems that we buy. So I think we can use all three of those mechanisms to influence the market.
Q: Ms. Burke, you mentioned the need for better data collection. That was one of your priorities. I imagine that data is what’s feeding a lot of the strategy as it stands now. My understanding is that data on energy use is not something that’s been consistently collected across the services. So I’m wondering if you can talk a little bit about your confidence in the data that you have and the challenges and goals going forward.
MS. BURKE: We have excellent data on fuel sales. So we do know where we’re selling fuel and using fuel and moving fuel. As far as what’s actually consuming that fuel and its -- what we would call its duty cycle, how it’s being used -- we have a lot less data on that. Now, how much, in a forward operating base -- how much of that fuel is going into generators, so far, we have mostly anecdotal advice -- some isolated studies here and there.
One of the best anecdotal pieces of evidence I’ve had is from an army major who just came back from running a forward operating base. He was the mayor of the base. And it -- this was a Stryker mission, so a Stryker is a vehicle that consumes a great deal of energy. But he told us that 80 percent of his delivered fuel was going into generators.
So we’re looking now to collect that kind of data so we have a better sense of -- you know, you can’t manage what you can’t measure. We want a better sense of where to target our efforts.
But all the services do collect some data in this area, and it’s just a question of finding what’s already out there and using it. Again, we haven’t really looked at this as a separate area to measure and to manage before. So it’s just finding out what’s available, what we need to collect. And we’re making progress across the board in that respect.
Q: Do you set any type of goals for when you want to achieve some of these -- base energy independence?
MS. BURKE: Well, this strategy is a true strategy in that it’s -- it tells the department, here’s the direction we’re going, here are the strategic goals and the ways you’re going to get there. The implementation plan will have some more specific timelines and some more specific policy targets to meet. So there will be those.
As far as metrics such as reduce X percent by Y date, I don’t feel that we have good enough data and analysis yet to set really solid metrics in this area. We will be doing that at a future time, setting those kinds of performance metrics, but for now the timelines and the targets are more policy-centered.
Q: Are you considering any type of incentives for units to keep some of the savings that they potentially are able to achieve?
MS. BURKE: Some of the military services -- the Navy, for example, has a very good program in this area called i-ENCON [energy conservation], which is a -- as the sailors on the shipboard save energy, they get to keep some of the proceeds. And we are looking at incentives and at how to use those kinds of tools as well.
Q: Ms. Burke, Gabe Starosta, Inside the Air Force. Can you talk a little bit about how you expect this strategy to affect the Joint Strike Fighter program either in terms of performance or in terms of life cycle costs over the long term?
MS. BURKE: I couldn’t really comment on that at this point. I think that that particular program is well under way and wouldn’t really be able to say for sure how it might affect that program.
MR. LYNN: One or two more, maybe, and then we’ll have to bring it to a close.
Q: Ms. Burke, I wanted to ask you about contractors in the battlefield. Why don’t they have an incentive to save fuel? For example, the LOGCAP [Logistics Civil Augmentation Program] contract says, that they use in the Army, they just charge the military for whatever fuel they use, but there’s no incentive to save fuel. Would you consider changing that?
MS. BURKE: Actually, I’m glad you asked because we’ve been working very hard to change that. And as of June 15th, some of the terms of those LOGCAP contracts will be changing so that there will be incentives for the contractors to have better energy efficiency and also to measure energy use, because a lot of times, these are the people who have access to the equipment and who already have the data.
So we’ve been working with Rock Island Arsenal and with other parts of our community that manage those contracts and have made some really good progress in figuring out how to move on the incentives. And we’ll continue that as well, but we’ve found willing partners in the private sector on that as well.
Q: General Petraeus’ memo mentions that we’ve lost many lives delivering fuel to bases around Afghanistan. Do you all keep statistics on that?
MR. LYNN: I mean, it’s -- we wouldn’t be fuel-specific. I mean, obviously, a lot of it would be in the convoys. And I don’t have them in my head, but we do have statistics on the number of attacks on convoys and the number of losses on convoys. And 80 percent of the convoys are fuel, so it wouldn’t -- it wouldn’t be a pure statistic like that, but it’s -- that would be how -- that -- I think that’s the basis for General Petraeus’ statement.
MS. BURKE: And there have been a couple of studies that looked at specific periods in time that took snapshots. One Army study said from 2003 to 2007, there were approximately 3,000 killed or wounded contractors, service members, civilians on convoys, on fuel convoys. And the Marines have done a little bit of work on this, too, but it’s very difficult to have accurate numbers.
And, you know, you always have to remember that the enemy gets a vote too. And if your numbers grow or shrink, it doesn’t tell you how you’re doing on your vulnerability. So, you know, it’s not a metric that I necessarily think is a useful one for us as far as knowing how we’re doing. But we certainly -- it’s a goal that we keep in mind at all times.
Q: But surely you’d want to know -- if there’s a large percentage of casualties in the war zone from your -- from your forces, from your uniform forces, are due to fuel supply, wouldn’t you want to know that?
MS. BURKE: Yes, of course. And as the deputy said, we have numbers on that that we track.
MR. LYNN: Yeah, I mean, it’s -- again, it’s not -- the biggest vulnerability are the convoys. It’s less -- you know, there’s some vulnerability on the base, but the biggest vulnerability is the transport. And there -- as I said, 80 percent of those convoys are for fuel. And so to a first order, you’d think that proportion of losses on convoys, you know, would be attributable to fuel.
MS. BURKE: Thank you very much.