DOD Alternative Fuels: Policy, Initiatives and Legislative Activity

Katherine Blakeley
Analyst in Defense Policy

This report provides background information and identifies issues for Congress regarding Department of Defense (DOD) alternative fuel initiatives, a subject of debate at congressional hearings on DOD’s proposed FY2013 budget. The services (the Army, Navy, and Air Force) have spent approximately $48 million to purchase alternative fuels, and the Navy has proposed a $170 million investment in biofuel production capacity. The services have also spent funds on testing, certification and demonstrations of alternative fuels. By comparison, DOD purchases of petroleum fuels totaled approximately $17.3 billion in FY2011.

DOD officials have said that any alternative fuels for DOD operational use must:

• be “drop-in;” that is, requiring no modification to existing engines, and
• be cost-competitive with conventional petroleum fuels.

Other desirable characteristics include:

• production from a non-food crop feedstock; and
• lifecycle greenhouse gas emissions less than or equal to conventional petroleum fuels.

Each military service has different alternative fuel goals. The Army has the broad aim of increasing the use of renewable energy, but has not adopted any specific alternative fuel goals. The Air Force goals are to test and certify all aircraft and systems on a 50:50 alternative fuel blend by 2012, and to be prepared to acquire 50% of the Air Force’s domestic aviation fuel as an alternative fuel blend by 2016. The Navy’s goals are to deploy a “Great Green Fleet” strike group of ships and aircraft running entirely on alternative fuel blends by 2016 and to meet 50% of the Navy's total energy consumption from alternative sources by 2020. To meet this goal for its ships, the Navy would need to replace approximately 8 million barrels of petroleum used in its ships with unblended alternative fuels by 2020.

The Navy has also entered into a Memorandum of Understanding (MOU) with the Department of Energy and the Department of Agriculture to promote the development of a domestic advanced biofuel industry through the construction of domestic biofuel plants and refineries. Under the Defense Production Act, the Navy and the Department of Energy plan to fund this initiative with $340 million in federal funds for capital investment and production, with at least equal costsharing from industry. The Department of Agriculture intends to provide an additional $171 million through the Commodity Credit Corporation to support biofuel feedstocks.

Legislative debate in 2012 related to DOD’s alternative fuels efforts has focused on two areas: (1) proposals in the National Defense Authorization Act for FY2013 (H.R. 4310, S. 3254) to maintain or limit DOD’s ability to purchase alternative fuels and invest in biofuel production capability, and (2) appropriations related to the joint Navy, Department of Energy, and Department of Agriculture biofuel production initiative.

Additional areas for potential congressional oversight include the costs and benefits to DOD of alternative fuels, as well as the coordination of alternative fuel initiatives within the services and between DOD and other federal agencies.


Date of Report: February 11, 2013
Number of Pages: 23
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Employment for Veterans: Trends and Programs

Benjamin Collins, Coordinator
Analyst in Labor Policy

David H. Bradley
Specialist in Labor Economics

Robert Jay Dilger
Senior Specialist in American National Government

Cassandria Dortch
Analyst in Education Policy

Lawrence Kapp
Specialist in Military Manpower Policy

Sean Lowry
Analyst in Public Finance

Christine Scott
Specialist in Social Policy

Veterans’ employment outcomes in the civilian labor market are an issue of ongoing congressional interest. This report offers introductory data on veterans’ performance in the civilian labor market as well as a discussion of veteran-targeted federal programs that provide employment-related benefits and services.

According to federal data, the unemployment rate for veterans who served after September 2001 is higher than the unemployment rate for nonveterans. Conversely, the unemployment rate for veterans from prior service periods (a much larger population than post-9/11 veterans) is lower than the nonveteran unemployment rate. The varied demographic factors of each of these populations likely contribute to these variations, though their degree of influence is unclear.

There are a number of federal programs to assist veterans in developing job skills and securing civilian employment. Broadly speaking, these programs can be divided into (1) general veterans’ programs, (2) programs that target veterans with service-connected disabilities, and (3) competitive grant programs that offer supplemental services but may be limited in scope.

General veterans’ programs begin with transition programs that are provided to exiting members of the Armed Forces. These transition programs cover a variety of topics including information on identifying occupations that align with military skills and specializations, conducting job searches, applying for employment, and navigating veterans’ benefits. One of the most common veterans’ benefits is educational funding through the GI Bill. The GI Bill programs typically provide funding for tuition, fees, housing, books and supplies, and other educational costs while the veteran is enrolled. Veterans who are no longer eligible for the GI Bill may receive training benefits through the Veterans Retraining Assistance Program (VRAP).

Veterans who are seeking employment without obtaining additional training may receive job search assistance and other services from Local Veterans Employment Representatives (LVER). Veterans who wish to pursue employment in the federal government are assisted by several policies that give them preference in the competitive hiring process or, in some cases, allow them to forego the competitive process and be appointed directly. Veterans who wish to start a small business may receive loans and technical assistance from the Small Business Administration (SBA).

Veterans with service-connected disabilities who have obstacles to employment may be assisted by the Vocational Rehabilitation and Employment (VR&E) program. This program provides assistance in identifying an occupation that is consistent with the veterans’ skills and interests and providing the services (including educational services) necessary to achieve that outcome. Disabled veterans can also receive assistance from the Disabled Veterans Outreach Program (DVOP), which provides assistance in local labor markets.

In addition to these nationwide programs, the federal government also funds competitive grant programs for state, local, and private entities to provide employment-oriented services to veterans. These include the Veterans Workforce Investment Program (VWIP), which may provide training or employment services and Veterans Upward Bound (VUB), which prepares educationally disadvantaged veterans for postsecondary coursework.


Date of Report: January 10, 2013
Number of Pages: 21
Order Number: R42790
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Department of Defense Energy Initiatives: Background and Issues for Congress

Moshe Schwartz
Specialist in Defense Acquisition

Katherine Blakeley
Analyst in Foreign Affairs

Ronald O'Rourke
Specialist in Naval Affairs

The Department of Defense (DOD) spends billions of dollars per year on fuel, and is pursuing numerous initiatives for reducing its fuel needs and changing the mix of energy sources that it uses. DOD’s energy initiatives pose several potential oversight issues for Congress, and have been topics of discussion and debate at hearings on DOD’s proposed FY2013 budget.

By some accounts, DOD is the largest organizational user of petroleum in the world. Even so, DOD’s share of total U.S. energy consumption is fairly small. DOD is by far the largest U.S. government user of energy. The amount of money that DOD spends on petroleum-based fuels is large in absolute terms, but relatively small as a percentage of DOD’s overall budget. DOD’s fuel costs have increased substantially over the last decade, to about $17 billion in FY2011. Petroleum-based liquid fuels are by far DOD’s largest source of energy, accounting for approximately two-thirds of DOD energy consumption. When DOD’s fuel use is divided by service, the Air Force is the largest user; when divided by platform type, aircraft are the largest user.

According to DOD, currently about 75% of DOD’s energy use is operational energy and about 25% is installation energy. Operational energy is defined in law as “the energy required for training, moving, and sustaining military forces and weapons platforms for military operations.” Installation energy is not defined in law, but in practice refers to energy used at installations, including non-tactical vehicles, that does not fall under the definition of operational energy.

DOD’s reliance on fuel can lead to financial, operational, and strategic challenges and risks. Financial challenges and risks relate to the possibility of a longer-term trend of increasing costs for fuel, and to shorter-term volatility in fuel prices. Operational challenges and risks relate to (1) the diversion of resources to the task of moving fuel to the battlefield; (2) the negative impact of fuel requirements on the mobility of U.S. forces and the combat effectiveness of U.S. equipment, and (3) the vulnerability of fuel supply lines to disruption. Strategic challenges and risks relate to getting fuel to the overseas operating area, and ensuring the global free flow of oil.

As part of its FY2013 budget submission, DOD has requested more than $1.4 billion for operational energy initiatives in FY2013. DOD’s office of Operational Energy Plans and Programs, headed by the Assistant Secretary of Defense, Operational Energy Plans and Programs (ASD (OEPP)), is responsible for developing DOD policy for operational energy and alternative fuels, and for coordinating operational energy efforts across the services.

Congress has been concerned with energy policy since the 1970s, and has passed legislation relating to federal government energy use, including DOD installation energy use. Congress has set specific energy-reduction targets for DOD installation energy, but not for operational energy.

Potential oversight issues for Congress regarding DOD’s energy initiatives include:

• DOD’s coordination of operational energy initiatives being pursued by the military services. 
• DOD’s efforts to gather reliable data and develop metrics for evaluating DOD’s energy initiatives. 
• DOD’s estimates of future fuel costs.
• DOD’s role in federal energy initiatives. 
• The Navy’s initiative to help jumpstart a domestic advanced biofuels industry. 
• The potential implications for DOD energy initiatives of shifts in U.S. military strategy.

Date of Report: February 11, 2013
Number of Pages: 75
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Navy Ford (CVN-78) Class Aircraft Carrier Program: Background and Issues for Congress

Ronald O'Rourke
Specialist in Naval Affairs

CVN-78, CVN-79, and CVN-80 are the first three ships in the Navy’s new Gerald R. Ford (CVN- 78) class of nuclear-powered aircraft carriers (CVNs).

CVN-78 was procured in FY2008. The Navy’s proposed FY2013 budget estimates the ship’s procurement cost at $12,323.2 million (i.e., about $12.3 billion) in then-year dollars. The ship received advance procurement funding in FY2001-FY2007 and was fully funded in FY2008- FY2011 using congressionally authorized four-year incremental funding. The Navy did not request any procurement funding for the ship in FY2012, and is not requesting any procurement funding for the ship in FY2013. The Navy plans to request $449 million in procurement funding in FY2014 and $362 million in procurement funding in FY2015 for the ship to cover $811 million in cost growth on the ship.

CVN-79 is scheduled to be procured in FY2013. The Navy’s proposed FY2013 budget estimates CVN-79’s procurement cost at $11,411.0 million (i.e., about $11.4 billion) in then-year dollars, and requests $608.2 million in procurement funding for the ship. The ship received advance procurement funding in FY2007-FY2012, and the Navy wants to fully fund the ship in FY2013- FY2018 using six-year incremental funding. The FY2013 budget proposes to lengthen the construction period for the ship by two years, so that the ship is delivered in September 2022, rather than in September 2020, as projected under the FY2012 budget. Although the ship is being procured in FY2013, the new delivery date of September 2022 is what in the past might have been expected for a carrier procured in FY2015.

CVN-80 is scheduled to be procured in FY2018. The Navy’s proposed FY2013 budget estimates the ship’s procurement cost at $13,874.2 million (i.e., about $13.9 billion) in then-year dollars. Under the Navy’s proposed FY2013 budget, the ship is to receive advance procurement funding in FY2016-FY2017 and be fully funded in FY2018-FY2023 using six-year incremental funding. The FY2013 budget proposes to lengthen the construction period for the ship by two years, so that the ship is delivered in 2027, rather than in 2025, as projected under the FY2012 budget. Although the ship is being procured in FY2018, the new delivery date of 2027 is what in the past might have been expected for a carrier procured in FY2020.

The Navy states that lengthening the construction periods of CVNs 79 and 80 by two years will not temporarily reduce the carrier force to less than 11 ships, but will instead eliminate some instances of when the carrier force would have temporarily numbered 12 ships.

Oversight issues for Congress for the CVN-78 program include the following: the potential impact of an FY2013 year-long continuing resolution (CR) and a sequester on FY2013 funding on the procurement of CVN-79; cost growth in the CVN-78 program; where the estimated procurement costs of CVNs 78, 79, and 80 now stand in relation to the legislated procurement cost caps for the ships, and whether the cost caps should be amended; whether to procure CVN- 79 and CVN-80 together in a two-ship block buy; and CVN-78 program issues that were raised in a December 2012 report from the Department of Defense’s (DOD’s) Director of Operational Test and Evaluation (DOT&E). .


Date of Report: February 11, 2013
Number of Pages: 42
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Navy Aegis Ballistic Missile Defense (BMD) Program: Background and Issues for Congress

Ronald O'Rourke
Specialist in Naval Affairs

The Aegis ballistic missile defense (BMD) program, which is carried out by the Missile Defense Agency (MDA) and the Navy, gives Navy Aegis cruisers and destroyers a capability for conducting BMD operations. Under MDA and Navy plans, the number of BMD-capable Navy Aegis ships is scheduled to grow from 24 at the end of FY2011 to 36 at the end of FY2018.

Under the Administration’s European Phased Adaptive Approach (EPAA) for European BMD operations, BMD-capable Aegis ships are operating in European waters to defend Europe from potential ballistic missile attacks from countries such as Iran. On October 5, 2011, the United States, Spain, and NATO jointly announced that, as part of the EPAA, four BMD-capable Aegis ships are to be forward-homeported (i.e., based) at Rota, Spain, in FY2014 and FY2015. BMDcapable Aegis ships also operate in the Western Pacific and the Persian Gulf to provide regional defense against potential ballistic missile attacks from countries such as North Korea and Iran.

The Aegis BMD program is funded mostly through MDA’s budget. The Navy’s budget provides additional funding for BMD-related efforts. MDA’s proposed FY2013 budget requests a total of $2,303.0 million in procurement and research and development funding for Aegis BMD efforts, including funding for Aegis Ashore sites that are to be part of the EPAA.

Issues for Congress for FY2013 include:

• the reduction under the proposed FY2013 budget in the ramp-up rate for numbers of BMD-capable Aegis ships over the next few years; 
• the cost effectiveness and U.S. economic impact of shifting four Aegis ships to Rota, Spain; 
• U.S. vs. European naval contributions to European BMD; 
• the lack of a target for simulating the endo-atmospheric (i.e., final) phase of flight of China’s DF-21 anti-ship ballistic missile; 
• the capability of the SM-3 Block IIB Aegis BMD interceptor; and 
• concurrency and technical risk in the Aegis BMD program.

Date of Report: February 14, 2013
Number of Pages: 92
Order Number: RL33745
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