Energy Department stimulus funds produce questionable results

Introduction

The Department of Energy has struggled to show how its $41.7 billion in stimulus funding created jobs, reduced environmental risks or improved nuclear waste cleanup.

Program funds went to energy efficiency, home weatherization, nuclear waste cleanup, and a loan guarantee program to promote renewable energy technology.

The loan guarantee program for renewable energy provided $6 billion in credits to eligible companies, but due to concerns with the administration of the program, Congress has reduced those funds by almost $4 billion. DOE only obligated 17 percent of the remaining $2.5 billion in the fund and will lose about $2 billion if it does not make final decisions on loan guarantees soon. Borrowers must begin construction on their projects by Sept. 30.

“Measuring the impact of Recovery Act funding has been a challenge for DOE. It has had particular difficulty providing an accurate assessment of the act’s impact on jobs, environmental risk reduction, and the life-cycle costs of its cleanup program,” the General Accounting Office report said.

The department used different methodologies to determine how many jobs were created, which created inaccurate and misleading numbers. Minus the energy efficiency program, DOE estimated the equivalent of 27,152 jobs were created, although many are ending as stimulus funding runs out.

GAO also said Energy failed to develop a way to measure the effectiveness of its cleanup work and its remains uncertain if stimulus funds will actually reduce the costs of the cleanup program.

Some recipients of the energy efficiency program reported challenges in providing job-creation metrics required by the department, and ended up estimating the number. Other recipients expressed frustration with the department’s changing reporting requirements.

FAST FACT: The GAO disagreed with calculations that DOE’s stimulus funded projects would produce an estimated $4 billion in cost savings. The GAO’s analysis indicates these savings could be 80 percent less than DOE’s estimate.

Following are other new watchdog reports released by the Government Accountability Office (GAO), various federal Offices of Inspector General (OIG), and other government entities.

NATIONAL SECURITY

MISC.

• Over five years, Federal Emergency Management Agency has been struggling to develop a $34 billion national preparedness system to respond more effectively to disasters. The agency made plans to assess the capability of the new system, but failed to implement them. (GAO)
• The Pentagon failed to review $167.5 billion of $303.7 billion identified as overpayments to contractors, vendors, and employees. The report by the chief financial officer was considered inaccurate and incomplete, as some overpayments went unreported and did not provide information about recovering funds. The Inspector General directed the CFO to collect improper payments and ensure all overpayments are reviewed. (Department of Defense Inspector General)