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Draft

In Focus: The Federal Energy Domain

R AY B J O R K L U N D , S V P A N D C KO1 6 N O V E M B E R 2 0 0 9

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Draft Federal Energy Domain

Focus on what’s addressable by federal contractors in facilitating practical “energy independence” Energy production

Power generation Applied sciences and technology, but not basic sciences

Energy management Resources management and sustainability initiatives,

but not environmental enforcement Regulatory oversight, but not departmental

management or Inspectors General Energy consumption

“Energy” ≠ Department of Energy

Source: FedSources analysis

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Draft Federal Energy Domain Model

Source: FedSources analysis of GFY2010 President’s Budget and Federal Energy Management Program reporting; contractor-addressable dollars in GFY2010 and compound annual growth rate

(CAGR) from GFY2008 to GFY2010; does not include grants, loans, subsidies, or incentives

Energy domain in the federal government

Energy production Energy management Energy consumption

Energy generation

New energy systems and

sources

Energy initiatives

Alternative fuel vehicles

Sustainability

Building technologies

Renewable sources

Fleet management

Facilities management

Strategic Petroleum Reserve

management

Energy information, policy, and regulation

Fuel consumption

Utilities consumption

Hydroelectric Coal

Natural gas

Electricity

Renewable sources

Solar

Wind

Geothermal

Biomass

Fuel oil and diesel

Propane

Motor gasoline

Aviation gasoline

Generation

Transmission and distribution

Secondary sources

Nuclear

Fossil fuel

Renewable sources Hydropower

Biofuels

$25.64B CAGR 46% $4.21B CAGR 165% $28.77B CAGR 18%

$58.62B CAGR 33%

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Draft Target Agencies in the Domain Model

Source: FedSources analysis of GFY2010 President’s Budget and Federal Energy Management Program reporting; contractor-addressable dollars in GFY2010 and compound annual growth rate

(CAGR) from GFY2008 to GFY2010; does not include grants, loans, subsidies, or incentives

Energy producers Energy managers Energy consumers

DoD

Legislative Branch

DoD

TVA

DOE PMA

NRC

FERC

GSA

USPS

VA

DoD

DOE EIA

DOE EEDOE EE

DOE OE

DHS

DOJ

DOC

USDA

Other civilian agencies

DOI NPS

HHS NIH

EPA

ACOEDOI BOR

DOE NNSA

$25.64B CAGR 46% $4.21B CAGR 165% $28.77B CAGR 18%

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Draft Energy Spending by Subdomain

GFY2008 GFY2009 GFY2010 GFY2011 GFY2012CAGR

GFY08 -GFY10

CAGR GFY08 -GFY12

Energy Management $601M $2,636M $4,206M 165%Energy Consumption $20,616M $21,224M $28,773M 18%Energy Production $12,056M $19,380M $25,643M 46%Totals $33,273M $43,240M $58,622M $48,740M $50,202M 33% 11%

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$30B

$40B

$50B

$60B

$70B

Cont

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pend

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Source: FedSources analysis of GFY2010 President’s Budget and Federal Energy Management Program reporting; contractor-addressable market does not include grants, loans, subsidies, or incentives

$10B ARRA effect

Strong potential for

near-term triple-digit growth in

Energy Management

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Draft Energy Spending by Spending Category

GFY2008 GFY2009 GFY2010 GFY2011 GFY2012CAGR

GFY08 -GFY10

CAGR GFY08 -GFY12

Prof services (incl R&D) $872M $4,794M $7,205M 187%Other white collar services $2,505M $3,667M $3,770M 23%Blue collar O&M services $4,088M $5,203M $8,844M 47%Telecomm $23M $28M $29M 12%Real Property $1,611M $3,805M $5,422M 83%Investment products $1,865M $2,292M $2,353M 12%Consumable products $1,692M $2,227M $2,226M 15%Utilities $7,467M $7,620M $9,169M 11%Fuels $13,150M $13,604M $19,603M 22%Totals $33,273M $43,240M $58,622M $48,740M $50,202M 33% 11%

$0B

$10B

$20B

$30B

$40B

$50B

$60B

$70B

Cont

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Source: FedSources analysis of GFY2010 President’s Budget and Federal Energy Management Program reporting; contractor-addressable market does not include grants, loans, subsidies, or incentives

Compared to an government-wide addressable CAGR

of 3%...

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Draft Federal Energy Market Drivers

Executive Order 13423 (24 Jan 2007) Strengthening Federal Environmental Energy, and Transportation Management

Public Law No: 110-140 (19 Dec 2007) Energy Independence and Security Act of 2007

Public Law No: 111-5 (13 Feb 2009) American Recovery and Reinvestment Act of 2009 (ARRA)

Executive Order 13514 (5 Oct 2009) Federal Leadership in Environmental, Energy, and Economic Performance

Leverage these drivers in selling to target agencies

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Draft

Source: Remarks of President Barack Obama – Address to Joint Session of Congress, February 24th, 2009; cloud map courtesy wordle.net

The President’s Agenda: Three Pillars

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Draft What Is Congress Thinking? (1)

Congress appropriated… Net cut of about $95M “Earmarks” of approx $345M

A number of activities self-supporting; no appropriations or increased offsetting collections Power Marketing Administration (mostly) Tennessee Valley Authority Nuclear Regulatory Commission Federal Energy Regulatory Commission

Residual ARRA funding offsets some appropriationsSource: FedSources analysis of House Rept. 111–278, Conference Report to accompany

H.R. 3183 Energy and Water Development and Related Agencies Appropriations Act, 2010

Energy Production and Energy Management

subdomains

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Draft What Is Congress Thinking? (2)

Source: FedSources analysis of GFY2010

President’s Budget and House Rept. 111–278, Conference Report to accompany H.R. 3183

Energy and Water Development and Related Agencies

Appropriations Act, 2010

Many “puts and takes”

Initiatives in Energy Production and Energy Management

SubdomainsPresident's

Request AppropriationsBiomass technologies $235M $220M -6%Building technologies $238M $200M -16%Earmarks $0M $342M 100%Education $115M $0M 0%Electrical storage $15M $14M -7%Energy marketing $283M $283M 0%Energy oversight $165M $143M -14%Energy regulation $184M $155M -16%Facilities $292M $308M 5%Fossil energy technologies $68M $96M 41%Geothermal technologies $50M $44M -12%Hydrogen technologies $122M $224M 100%Hydrokinetic technologies $30M $50M 67%Industrial technologies $407M $397M -2%Infrastructure security $56M $46M -18%Program management $941M $737M -22%Solar technologies $320M $225M -30%Transmission and distribution $115M $77M -33%Vehicle technologies $333M $311M -7%Wind technologies $75M $80M 7%

Congressional Markup

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Draft What Is Congress Thinking? (3)

Congressional concerns: Overlapping programs Risk of risky technologies Moving low-risk technologies from the lab to practical

application Not pursuing technologies of interest to Congress Effective use of ARRA funding Infrastructure protection

Source: FedSources analysis of House Rept. 111–278, Conference Report to accompany H.R. 3183 Energy and Water Development and Related Agencies Appropriations Act, 2010

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Draft What Is Congress Thinking? (4)

Cyber security R&D funding for National electricity grid security Protocols and policies for Smart Grid integration Validate and test SCADA technologies and software

DOE to establish a public-private organization of producers and technology providers to Identify vulnerabilities and develop strategies Test and validate technologies and software Develop and disseminate best practices

Source: FedSources analysis of House Rept. 111–278, Conference Report to accompany H.R. 3183 Energy and Water Development and Related Agencies Appropriations Act, 2010; SCADA is supervisory control and data acquisition

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Draft Other Energy-related Initiatives

GSA-PBS retrofit and conservation $35+M DoD construction, facility modifications, and

research $90+M GSA alternative fuel vehicle acquisition $3+M DoD-DESC $50+M

Synthetic fuels Biomass and algae oil to energy Hydrogen technologies Automated fuel handling and measuring equipment Supply chain automation

Source: FedSources analysis of GFY2010 President’s Budget

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Draft Addressing the Federal Energy Market

Objective is to facilitate “energy independence”

Energy Consumption requires effective purchasing methods and improved efficiencies• New fuel systems, like alternative fuels• Purchasing methods, like energy performance contracts

Energy Production requires new technology, process improvement• Generating technologies, like hydrokinetics• Distribution methods, like Smart Grid

Energy Management ties production and consumption together with overarching programmatic controls and oversight• Monitoring, like automatic metering• Budgeting, like greenhouse gas trading

$25.64B

$4.21B

$28.77B

Source: FedSources analysis of GFY2010 President’s Budget and energy legislation; amounts represent GFY2010 addressable market

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Draft Get ‘em While They’re Hot!

Source: FedSources analysis of GFY2010 President’s Budget and Federal Energy Management Program reporting; contractor-addressable dollars in GFY2010 and compound annual growth rate

(CAGR) from GFY2008 to GFY2010; does not include grants, loans, subsidies, or incentives

Energy producers Energy managers Energy consumers

DoD

Legislative Branch

DoD

TVA

DOE PMA

NRC

FERC

GSA

USPS

VA

DoD

DOE EIA

DOE EEDOE EE

DOE OE

DHS

DOJ

DOC

USDA

Other civilian agencies

DOI NPS

HHS NIH

EPA

ACOEDOI BOR

DOE NNSA

$25.64B CAGR 46% $4.21B CAGR 165% $28.77B CAGR 18%