Barrasso Presses DOE on Misleading Claims Regarding Funding Announcements
WASHINGTON, D.C. — Today, U.S. Senator John Barrasso (R-WY), ranking member of the Senate Committee on Energy and Natural Resources (ENR), sent a letter to Department of Energy (DOE) Deputy Secretary David Turk regarding misleading claims about DOE’s vetting of Infrastructure Investment and Jobs Act (IIJA) award recipients. Deputy Secretary Turk recently testified before ENR at a hearing to examine DOE’s implementation of the IIJA.
In the letter, Barrasso points out the significance of DOE misleading investors about companies selected to receive funding from IIJA. He stresses the need for DOE to adopt a more transparent approach to the communication of its award selections. Barrasso also calls on the department to complete a more thorough evaluation of applicants, their eligibility, and their association with foreign adversaries prior to award selection and announcement.
Read the full letter here and below.
Dear Deputy Secretary Turk,
As you recall, during the February 2, 2023, Senate Energy and Natural Resources Committee (Committee) hearing, I, along with other Committee members, asked you about the Department of Energy’s (DOE) vetting of Infrastructure, Investment, and Jobs Act (IIJA) award recipients.
In your responses to the Committee’s questions, you indicated that the awards that were announced for each company were preliminary or conditional in nature. You stated that before the Department disburses any taxpayer funds to an award selectee, the Department goes through “a due diligence process” and “negotiate[s] an award.” You emphasized that “no taxpayer funding is going to any of these companies yet.”
This characterization, however, is at odds with the Department’s statements related to the IIJA. A press release dated October 19, 2022, on the DOE website announces “the first set of projects funded by the President’s Bipartisan Infrastructure Law to expand domestic manufacturing of batteries for electric vehicles (EVs) and the electrical grid and for materials and components currently imported from other countries.” The press release continues with, “the 20 companies will receive a combined $2.8 billion.”
The fact sheet accompanying this announcement further states, “Funded through $2.8 billion from the Bipartisan Infrastructure Law, the portfolio of projects will support new and expanded commercial-scale domestic facilities?to process lithium, graphite and other battery materials, manufacture components, and demonstrate new approaches, including manufacturing components from recycled materials.” By all accounts, such language indicates that these awards are final and distributed.
The funding opportunity announcement (FOA) associated with these awards states that award negotiations will occur after selections are made. But at no point does the FOA suggest that DOE could pull the plug on an award as long as selectees are “responsive during award negotiations and meet negotiation deadlines.”
Companies and investors clearly believe award negotiations are a formality. They believe the Department’s award announcements are meaningful, as is evident by looking at the share prices of publicly traded companies selected for awards. Of the twenty companies selected for awards, share prices of those that were publicly traded averaged an increase of almost 14% between the day before and day of the Department’s respective award announcement.
It is clear the Department has misled shareholders investing in companies selected for IIJA awards. Accordingly, it is imperative the Department adopts a more transparent approach in its communication of its award selections to the public. Additionally, the Department needs to be more thorough in its evaluation of applicants, their eligibility, and their association with foreign adversaries prior to award selection and announcement.
I ask that you provide answers to the following questions regarding DOE’s award selection process. Please provide thorough and thoughtful responses to these questions by March 10, 2023.