Transforming the Way DoD Looks at Energy
In an environment of uncertainty about the price and availability of traditional energy sources, DoD is facing increasing energy demand and support requirements that it must meet if it is to achieve its broader strategic goals—notably, establishment of a more mobile and agile force. However, recent technological advances in energy efficiency and alternative energy technologies offer a unique opportunity for DoD to make progress toward reconciling its strategic goals with its energy requirements through reduced consumption of fuel—especially foreign fuel. To capitalize on this opportunity, DoD needs to implement an energy strategy that encompasses the development of innovative new concepts and capabilities to reduce energy dependence while maintaining or increasing overall warfighting effectiveness. Recognizing that DoD must change how it views, values, and uses energy—a transformation that will challenge some of the department’s most deeply held assumptions, interests, and processes—the Office of Force Transformation and Resources, within the Office of the Under Secretary of Defense for Policy, asked LMI to develop an approach to establishing a DoD energy strategy.
- LMI identified three areas of disconnect between DoD’s current energy consumption
practices and the capability requirements of its strategic goals:
- Strategic. DoD seeks to shape the future security environment in favor of
the United States. But, our dependence on foreign supplies of fuel limits
our flexibility in dealing with producer nations who oppose or hinder our
goals for greater prosperity and liberty.
- Operational. DoD’s operational concepts seek greater mobility, persistence,
and agility for our forces. But, the energy logistics requirements of
these forces limit our ability to realize these concepts.
- Fiscal. DoD seeks to reduce operating costs of the current force to procure new capabilities for the future. But, with increased energy consumption and increased price pressure due to growing global demand for energy, energy-associated operating costs are growing.
In parallel with the increase in the global demand for energy is an increase in concern about global climate change and other environmental considerations. Therefore, when identifying technical solutions to its energy challenges, DoD should also considered a fourth disconnect—environmental.
From our research, we concluded that DoD has the opportunity to address the four disconnects by fundamentally changing how it views, values, and uses energy. Many actions are required to implement this transformation, but the highest-level requirements are straightforward:
- Incorporate energy considerations (energy use and energy logistics support
requirements) in the department’s key corporate processes: strategic planning,
analytic agenda, joint concept and joint capability development, acquisition,
and planning, programming, budgeting, and execution (PPBE)
- Establish a corporate governance structure with policy and resource oversight
to focus the department’s energy efforts
- Apply a structured framework to address energy efficiency, including alternate energy sources, to the department’s greatest energy challenges— those areas consuming the most fuel, requiring the most logistics support, or having the most negative impact on the warrior.
The following are some options for energy actions related to DoD’s corporate processes:
- Apply the energy-efficiency requirements of Executive Order 13423
(3 percent reduction per year, or 30 percent reduction by 2015 from 2003
baseline) to mobility forces
- Analyze current and projected energy and energy logistics required to
support operational plans and capability-based planning and incorporate
findings in other corporate processes
- Assess the role of information in reducing energy requirements through
improved operational and logistics effectiveness and reduced in-theater
- Incorporate energy considerations (energy use and energy logistics support requirements) in all future concept development, capability development,
and acquisition actions
- Make energy a top research and development priority
- Improve the incentives for investment in energy efficiency
- Increase global efforts to enhance the stability and security of oil
infrastructure, transit lanes, and markets through military-to-military and
- Make reducing energy vulnerability a focus area of the next strategic planning cycle and Quadrennial Defense Review.
Considering the need for collaboration among the services and DoD, we believe an empowered committee would be more effective that a single leader. From our survey of emerging energy technologies, the department has a wide range of options for addressing energy efficiency and alternate sources of energy.
Under the guidance of the coordinating body, DoD can begin a structured analysis of how to apply organizational, process, and technology changes to execute a strategy to reduce energy dependence. Although assessing the strategic, operational, fiscal, and environmental impacts of a change provides a mechanism to value potential choices, these impacts may not provide sufficient insight to be determinative.
To promote the changes that will have the greatest utility in addressing the disconnects, we recommend that the department begin by focusing on three areas:
- Greatest fuel use (aviation forces)
- Greatest logistic difficulty (forward land forces and mobile electric power)
- Greatest warrior impact (individual warfighter burden).
DoD energy transformation must begin in the near term, addressing current practices and legacy forces, while investing for long-term changes that may radically alter future consumption patterns.
We recommend a time-phased approach to reduce our reliance on fossil and carbon-based fuels. This approach includes the following:
- Organizational and process changes that can be implemented immediately
- Engineered solutions, to improve the efficiency of current forces and those
- Invention of new capabilities, employed in new operational concepts, for those forces yet to be developed.
Applying this approach to the three focus areas will give DoD an opportunity to develop portfolios of solutions that can reduce energy use and dependence. The coordinating body can evaluate these portfolios to against the energy disconnects to identify optimal solutions across the services, broader department objectives, and U.S. government strategic objectives and energy efforts. The coordinating body can then focus technology development as required to achieve the desired solutions.
For the energy transformation to be successful, DoD’s senior leaders must articulate a clear vision for the change and must ensure—through their sustained commitment and active participation—that it becomes engrained in the organization’s ethos.
We propose the following vision:
DoD will be the nation’s leader in the effective use of energy, significantly reducing DoD’s dependence on traditional fuels and enhancing operational primacy through reduced logistics support requirements.
Establishing a goal for mobility energy efficiency will provide near-term objectives in support of the vision, enhance operational effectiveness by reducing logistics support requirements, and free resources for recapitalization of the force. Our estimates show that implementing a 3 percent reduction per year until 2015 could result in savings of $43 billion by 2030 based on Energy Information Agency reference case price projections, without including any multiplier effects.
In view of the long period required to develop and populate the force with new concepts and capabilities, DoD should begin now to shape the force for an uncertain energy future.
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