US DOE inspector says its management of smart-grid program lacking

Posted: May 30, 2014 in Uncategorized
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Washington (Platts)–23Jan2013/223 pm EST/1923 GMT

The US Department of Energy has failed to properly manage a $700 million program aimed at demonstrating the use of smart grid technology, with millions of dollars in questionable spending, the agency’s inspector general said Wednesday.
The funding came under the 2009 American Recovery and Reinvestment Act, and is meant to demonstrate innovative smart-grid technologies, including advanced electricity meters, automated distribution systems and grid-scale energy storage systems.

“Our review of 11 projects, awarded $279 million in Recovery Act funding and $10 million in non-Recovery Act funding, identified weaknesses in reimbursement requests, cost-share contributions, and coordination efforts with another Department program,” DOE Inspector General Gregory Friedman said in a report to Energy Secretary Steven Chu.

 

“These issues resulted in about $12.3 million in questioned costs,” Friedman said. “In the absence of significant improvements, the program is at risk of not meeting its objectives and has an increased risk of fraud, waste and abuse.”

IG investigators examined 11 of the 32 projects that received funding under the program.

Specifically, the IG found that DOE had overpaid two recipients a total of $9.9 million based on estimated costs and not actual costs, and reimbursed a recipient $2.4 million for several energy-storage units that had not yet been manufactured.

In addition, DOE failed to follow proper procedures in vetting recipient cost-share contributions, and improperly awarded $14 million to a project that had already received $2 million under the department’s Advanced Research Projects Agency-Energy, according to Friedman.

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