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The Headquarters staff is responsible for overall program direction which implements DOE policy and communicates that policy to the Energy Technology Centers, sets program objectives, develops program plans and evaluates alternative program strategies, develops and defends budget requests to the Office of Management and Budget and to the Congress, approves procurement plans, monitors work progress, evaluates projects, and approves revisions in work plans as required to attain program goals.

The Energy Technology Centers support day-to-day project management functions for assigned programmatic areas including contract and National Laboratory monitoring, development and maintenance of project budget, and procurement plans, and other activities related to program and site support.

The Office of the Federal Inspector for the Alaska Natural Gas Transportation System is responsible for coordinating all Federal activities pertaining to the pipeline in order to assure timely, efficient, safe, and environmentally sound construction including the assessment of developments in the world energy market, specifically the U.S. and Canadian oil and gas situation as they affect the Alaska Natural Gas Transportation System.

The $40,221,000 requested for FY 1987 would support the following activities:

Headquarters Program Direction ($11,260,000)

o Provide funds for salaries, benefits, and travel for Headquarters staff and overhead expenses generic to the entire FE program, including SBIR assessments. ($11,260,000)

ETC Program Direction ($28,740,000)

O Provide funds for ETC indirect costs and for site support. ($28,740,000) Federal Inspector for the Alaska Natural Gas Transportation System ($221,000)

O Continue technical reviews of ANGTS design and/or remobilization packages. ($36,000)

O Complete long-term Frost Heave research using prior year funding. ($11,000)

Continue development and refinement of Remobilization Encyclopedia. ($10,000)

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Continue to assess developments in U.S. and Canadian energy markets, and gas exploration and transportation projects in reference to ANGTS. ($33,000)

O Continue to maintain liaison with project sponsors, producers, other
Government agencies, State of Alaska and Canadian Government.

($26,000)

Salaries and related expenses for administrative and support functions. ($105,000)

The goals of the industry cooperative R&D venture pool are to increase the market relevance and penetration of federally funded applied R&D, to increase private sector leverage of federal funds, and to ensure that taxpayer-supported work in industry will benefit the industry and economy at large and not just a single company.

The vehicle for achieving this will be industry formed cooperative R&D ventures. The core of such ventures would be several private firms with at least two from the same industry (that is the distinction between "cooperative venture" and a "joint venture"). The structure should, however, allow other parties such as investors, universities, institutes, and public laboratories to participate in the partnership as well.

The principal objectives of the program are to:

Implement a process by which industry will join with Government in applied research and development activities that will result in products, processes, and technology that will contribute to achieving the energy and technology goals of the United States.

Reduce and/or eliminate traditional barriers that have limited the financial and technical cooperation between the private and public sectors (e.g., patent positions, proprietary rights, anti-trust concerns, etc.).

Identify a variety of incentives particularly suited to the needs of various venture partners.

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In its FY 1987 budget proposal, the Department opted to limit the initial phase-in of the cooperative venture program to extraction technologies. In prior years, the Office of Fossil Energy has significantly increased the knowledge base for oil, gas and shale technologies. The nature of the economics of many of these technologies, coupled with the solid background of relevant industrial firms in participating in joint venture projects, makes extraction technologies prime candidates for an initial effort to examine the feasibility of the cooperative R&D venture pool approach.

anticipated in these areas range from

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The spectrum of efforts laboratory/bench scale activities through field tests precursors to actual commercial deployment and cash flow. The scale will vary from technology to technology and from resource to resource.

For example, many unconventional gas resources have not been defined well enough to develop predictable recovery strategies. Industry and other parties could form a cooperative venture with DOE to develop sufficient data requisite for the next step: design and test of promising recovery concepts. Similarly, in the area of underground coal gasification, primary interest could be focused on modest-scale, pre-commercial field tests to produce the data necessary for the subsequent design and construction of commercial plants. Additionally, interest may be expressed in the use of the technology in otherwise unattractive coals not currently being produced.

Therefore, in FY 1987, $12,500,000 will be made available to:

o Encourage the formation by industry of cooperative R&D ventures (which may also include other parties such as investors, universities, institutes and public laboratories) to offer partnership opportunities to DOE in the following areas: recovery of gas from unconventional sources; enhanced oil recovery; oil shale; and underground coal gasification. ($12,500,000)

The principal goal of this program is, as stated in Public Law 99-190, "for the purposes of conducting cost-shared clean coal technology projects for the construction and operation of facilities to demonstrate the It is targeted at a vide

feasibility of future commercial operation." variety of market applications.

Public Law 99-190 made available a total of $397.6 million for the Clean Coal Technology demonstration program (after the 0.6% general reduction applied across-the-board to programs contained in Public Law 99-190). Of these monies, $25 million will be held in reserve to cover the cost of overruns in the event the Government agrees to share such costs. Also, funds will be set aside for contracting, travel, and ancillary costs incurred by the Department of Energy in implementing the program. All of the remaining funds will be available for award. Under the terms of Public Law 99-190, the funds will become available in three increments as follows: $99.4 million in FY 1986, $149.1 million in FY87, and $149.1 million in FY88.

The Clean Coal Technology Program is related to, but not a direct continuation of, the effort undertaken by DOE following passage of Section 321, Public Law 98-473, 98 Stat. 1874. This section directed the Secretary of Energy to solicit "statements of interest in, and proposals for projects employing emerging clean coal technologies," and submit a report to Congress. In carrying out this Congressional request, DOE received 175 submissions with project values totaling more than $8 billion. On May 1, 1985, DOE submitted its findings in the Report to Congress on Emerging Clean Coal Technologies (NTIS Document Number: DE850154290). The Department also submitted Supplemental Report to Congress on Emerging Clean Coal Technologies (NTIS Document Number: DE85018356) which further characterized a wide range of clean coal technologies.

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Funds for the Clean Coal Technology program subsequently made available by Congress will provide for a competitive solicitation of project proposals and the award of cost-shared federal assistance to those projects that best demonstrate the feasibility of new clean coal technologies for future commercial applications. The issuance of the solicitation, receipt of proposals, and selection of projects will be made in accordance with the timetable established in Public Law 99-190. Specifically, the $149.1 million previously made available for FY 1987 will be used to:

O Support, on a cost shared basis with the private sector, demonstrations of advanced technologies to gather data needed for their ultimate commercialization. ($147,112,000)

Provide for contractual services and in-house support in performing post award monitoring and technical data base activities. ($1,988,000)

The following page contains a table summarizing the FY 1985-FY 1987 funding for DOE's Fossil Energy research and development program. (The chart does not reflect funding made available for the Clean Coal Technology program since it represents previous appropriations.)