[BETA] Fortnightly

The Department of Energy (DOE) will definitely be leaner in the future, if not outright abolished by the newly Republican Congress. To get a jump on Republicans as well as to help pay for a middle-class tax cut, President Clinton proposes to cut DOE's budget by $10.6 billion over the next five years-a 10-percent cut in the agency's $18-billion annual budget.

Energy Secretary Hazel R. O'Leary has formed a 35-member "structure team" of agency employees and outside industry experts to plan "a new DOE." The external steering committee, headed by Mark De Michele, president and CEO of Arizona Public Service Co. (APS) will submit its report April 29. Deputy secretary Bill White, head of the internal steering committee, says he will use De Michele's restructuring of APS as a model for reorganizing DOE: "APS identified the core businesses it wanted to be in, then used employees to define what value they can add." The restructuring will extend to personnel. O'Leary already was planning to cut headquarters staff by 8 percent over five years, field offices by 5 percent, and contracting personnel (the largest segment) by 20 percent-paring 1,200 from DOE's 20,000-person staff, and 28,000 from its 144,000 contract employees.

The budget cuts, which are short on specifics, target five areas. The largest, $4.4 billion over five years, would decimate the agency's $6-billion annual program to clean up nuclear and chemical waste sites, primarily at the nation's nuclear weapons factories. Another $3 billion would come from the undefined category of "strategic realignment" and "facility transition." In addition to reducing personnel, cuts could include shutting one or more of the nation's 28 labs and converting weapon facilities to civilian purposes. A $1.2-billion cut is slated for "applied research programs"-that is, DOE's research and development programs and the clean-coal technology program, which would be allowed to expire when current funding ends. Selling the Naval Petroleum Reserves at Elk Hills, CA, and Teapot Dome, WY, should garner an additional $1.6 billion. And another $400 million will come from selling highly enriched uranium acquired from the Soviet Union to commercial nuclear plants. In addition, the Administration is considering selling or privatizing one or more of the nation's five federal power-marketing agencies. Although Vice President Gore says the Bonneville Power Agency definitely would not be sold, the other four still ride in the tumbril. In a letter to all DOE personnel, O'Leary said: "Achieving these savings will be a challenge, particularly in light of calls to abolish the Department of Energy in its entirety. Hearing these calls is painful."-LG

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