DOE Report Shows Smart Grid Program Funds Mismanaged

The DOE inspector general said in a report that funds from $700 million smart-grid technology program have been mismanaged.

The DOE mismanaged funds for a $700 million program supporting smart-grid technology, according to a report by the agency’s inspector general, Gregory Friedman.

With millions of dollars of spending in question, Friedman warns in his report that if changes are not made to the program, the objectives will not be met.

"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."

The funding was granted to the DOE following the 2009 American Recovery Act. The goal of the program is to demonstrate the benefits of smart-grid technology. This includes advancements in electricity meters and improvements to grid-scale energy storage.

There are 32 projects made possible from the 2009 grant, 11 of which were reported on by Friedman.

"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," Friedman said in the report to Secretary of Energy Steven Chu.

Some additional issues found by Friedman included overpayments and failures in the procedures for vetting recipient cost-share contributions.

The DOE Assistant Secretary for Electricity Delivery and Energy Reliability Patricia Hoffman defended the program, however, saying that the DOE enacted a higher level of oversight for the program in comparison to other programs under the department.

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