Washington, D.C. - Subcommittee on Oversight and Investigations Chair Morgan Griffith (R-VA) delivered the following opening remarks during today’s Oversight and Investigations Subcommittee hearing titled “Microvast and More: Oversight of President Biden's Energy Spending Spree."
Excerpts and highlights below:
THE NEED FOR INCREASED OVERSIGHT
“Today, for the first time, this Committee welcomes the head of the Department of Energy’s new Office of Manufacturing and Energy Supply Chains or ‘MESC.’
“In February 2022, as part of the Department’s newest reorganization plan, three new program offices, including MESC, were created.
“MESC was setup with the goal of strengthening energy supply chains and increasing the domestic manufacturing base.
“This is intended to support what the DOE characterizes as a ‘clean and equitable energy transition.’
“MESC is currently administering about a dozen programs funded through the Infrastructure Investment and Jobs Act and the so-called Inflation Reduction Act.
“Almost all of MESC’s programs have been created recently.
“In short, a brand-new office will give out billions in funding for numerous new programs over the course of a just couple of years.
“Now I don’t care what party you are, this scenario, no matter the department or the administration, deserves increased oversight."
MICROVAST AND THE CHINESE COMMUNIST PARTY
“Not long after its creation, MESC came to the attention of then-Republican Leader Rodgers and myself after it announced $2.8 billion in financial awards to 20 companies under its Battery Manufacturing and Recycling Grants Program in October of last year.
“As part of these announcements, Microvast Incorporated, was selected to receive a $200 million dollar grant for a battery manufacturing plant in Tennessee.
“Shortly after the announcement, Microvast’s association with the Chinese Communist Party became apparent.
“Microvast produced its battery components in China, the bulk of its revenue was generated in China, and according to Microvast’s own SEC filings: The government, referring to the People’s Republic of China, quote, ‘…exerts substantial influence over the manner in which we must conduct our business activities and may intervene, at any time and with no notice.’
“After learning of Microvast’s concerning ties to China, then-Republican Leader Rodgers and I sent a letter to Secretary of Energy Jennifer Granholm on December 14th of last year requesting a briefing to include specific information about the Microvast award.
“The Department has yet to answer our specific questions, provide any documents, or sufficient information about the vetting processes behind the Battery Manufacturing and Recycling Grants awards.
“In response, we asked, with two weeks’ notice, that the appropriate official from the DOE testify before this Subcommittee on May 23rd.
“Unfortunately, the Department refused to attend, citing inadequate time to prepare.
“However, strangely enough, the night before the hearing, the Department announced it was canceling its tentative award to Microvast. It is unclear whether these events are related.
“To date, the Department has still not shared with Congress the reason for this decision or any details of additional due diligence the Department may, or may not, have conducted."
FOREIGN THREATS TO OUR ENERGY SUPPLY CHAINS
“We had an informative discussion with the witnesses who did join us on May 23rd to talk about general challenges facing our energy sector supply chains.
“The witnesses talked at length about threats posed by foreign rivals to our energy security, including in government programs.
“The main point is, we don't want Chinese companies getting American taxpayers’ money to create more Chinese jobs and Chinese technology, even if some of those jobs end up being in the United States.
“My colleagues and I have a lot of questions only the Department of Energy can answer. MESC’s goal is to boost domestic industry and secure energy supply chains.
“However, the Microvast misstep has increased our doubt as to whether this mission is successfully being carried out.
“While I commend the office for canceling the Microvast award, it shouldn’t take a news story and multiple congressional letters for MESC not to award grants to problematic companies.
“The main cloud of haze here concerns due diligence and vetting processes at DOE.
“We are aware of at least one other selectee besides Microvast that is also no longer moving forward with the awards process, the detailed reasons for the Amprius grant cancellation is unknown.
“While we were disappointed in the Department’s refusal to participate in our hearing last month, I am glad to finally have them here today.
“As such, we welcome Mr. David Howell, Principal Deputy Director of MESC.
“Mr. Howell has previously served as MESC’s Acting Director as well as Director of the Vehicle Technologies Office.
“Today, we hope to learn more about this new office. This Committee also hopes to gain some insight on how it is prioritizing its awards and how seriously it takes its domestic manufacturing charter.
“I thank Principal Deputy Director Howell for joining us today, and I look forward to our discussion."