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Chairwoman Dianne Feinstein, Ranking Member John Kennedy, and Members of the Subcommittee:
My name is Lars Erik Schönander. I am a Policy Technologist at Lincoln Network, a think tank to help bridge the gap between Silicon Valley and DC along with leveraging technology and technical talent to solve governance and policy challenges.
The Department of Energy has requested $144 million for FY 2023 for the Energy Information Administration (EIA).[1] As Congress considers that request, the committee should require the EIA to collect and report data on foreign investments in the U.S. energy sector to restore transparency in our energy industry as a requirement for fulfilling the request. I respectfully urge the committee to consider making EIA collect data on foreign energy investment in the United States again.
Much like in the 1970s, when the United States founded the Department of Energy, we are in a chaotic period for the energy sector. With gas prices at new heights,[2] it is critical that the public has a transparent picture of America’s energy industry, and who controls and invests in the assets in said industry.
When Congress established the Department of Energy by passing the Department of Energy Organization Act of 1977, lawmakers included the following language to ensure transparency about foreign influence in the US energy sector and other matters:[3]
In accordance with the Department of Energy Organization Act, 42 U.S.C. 7257(8), the Energy Information Administration (EIA) prepares an annual report for the Secretary of Energy and for transmittal to Congress that summarizes foreign investment, energy operations, and financial performance in U.S. energy enterprises. The information is available for use by the Congress, government agencies, and the public.
These reports provided legibility to our energy industry. For example, the “Acquisitions and Divestitures in U.S. Energy by Foreign Direct Investors 2007” report shows what companies and what countries bought and sold American energy companies.[4] Similarly, the “Profiles of Foreign Direct Investment in U.S. Energy” report shows what regions of the world were investing in our petroleum industry.[5]
Reviewing the history of this program, however, shows that the Department of Energy has stopped collecting this information.[6] As a result of a $15.2 million budget cut at EIA in 2011, a variety of data collection programs were canceled.[7] One of these programs was the form EIA-28, the “Financial Reporting System.” The EIA-28 form was the basis for the annual EIA reports providing analysis on foreign investment in our energy industry. Since its cancellation, no reports have been generated.
The Committee should direct the Department of Energy to report to Congress on how to restart this program and collect this information. While EIA tried to restart the collection of the data after 2011, as seen by notices in the Federal Register in 2013,[8] these submissions did not lead to the form being used again. Congress should require the Department of Energy to investigate why this program was cut in 2011 and why attempts to bring it back later did not succeed, and then mandate the Department of Energy to bring back the program.
Conclusion
The funds that Congress provides to the Energy Information Administration offer the American people one of the best sources of information on our energy industry. In FY 2023, the Committee should mandate that funding to the EIA be tied to collecting data that provides transparency on how foreign investors interact with our energy industry. Doing so would allow the American people and Congress to understand the full extent of foreign countries’ investment in our energy industry.
[1] Department of Energy, “Department of Energy FY 2023 Congressional Budget Request,”, March 2022,
https://www.energy.gov/sites/default/files/2022-04/doe-fy2023-budget-in-brief-v6.pdf.
[2] Ella Koeze and Clifford Krauss, “Why Gas Prices Are So High,” New York Times, June 14, 2022, https://www.nytimes.com/interactive/2022/06/14/business/gas-prices.html.
[3] General Accounting Office, GAO/NSIAD-90-25BR, Foreign Investment: Federal Data Collection on Foreign Investment in the United States (1989), p. 12, https://www.gao.gov/assets/nsiad-90-25br.pdf.
[4] Energy Information Administration, “Acquisitions and Divestitures in U.S. Energy
by Foreign Direct Investors 2007,” 2007, https://www.eia.gov/finance/archive/fdiad2007.pdf.
[5] Energy Information Administration, “Profiles of Foreign Direct Investment in U.S. Energy,” 1990,
https://play.google.com/books/reader?id=Hayc48sTggYC&pg=GBS.PA8&hl=en.
[6] Lars Erik Schönander, “The United States Should Collect Data on Foreign Energy Investment Again,” RealClearEnergy, May 24, 2022, https://www.realclearenergy.org/articles/2022/05/24/the_united_states_should_collect_data_on_foreign_energy_investment_again_834001.html, May 24, 2022.
[7] Energy Information Administration, “Immediate Reductions in EIA's Energy Data and Analysis Programs Necessitated by FY 2011 Funding Cut,” April 28, 2011, https://www.eia.gov/pressroom/releases/press362.php.
[8] 78 Fed. Reg. No. 48 (March 12, 2013), https://www.govinfo.gov/content/pkg/FR-2013-03-12/pdf/2013-05632.pdf.
