The Department of Energy has not always effectively managed projects through the Industrial Carbon Capture and Storage Program, Energy’s inspector general has said.
Energy received about $1.5 billion through the Recovery Act for clean industrial technologies and sequestration projects through the program, but a review of 15 recipients that were awarded $1.1 billion showed the department had not adequately documented the approval and rationale to use $575 million to accelerate existing projects rather than proceed with new awards, as required by federal and department policies, the IG found.
It said the department reimbursed recipients for about $16.8 million without obtaining or reviewing adequate supporting documentation, and awarded three recipients over $90 million in Recovery Act funds even though the merit review process identified significant financial and/or technical issues.
Further, the department did not ensure that recipient subcontractor or vendor selections for goods and services represented the best value, the IG said.
It attributed the issues to a lack of effective monitoring and oversight on the part of program officials, and called for enhanced monitoring procedures, including evaluating recipient documentation to support costs claimed and ensuring that reviews such as audits of internal controls are conducted as required.
It also recommended that Energy ensure significant decisions supporting the Carbon Program are adequately documented, and said contacting officers should review questioned costs identified in the report and determine whether they were allowable and reasonable.
Management generally agreed, but rejected a recommendation to develop and implement policies and procedures designed to identify and mitigate conflicts of interest and to enforce requirements pertaining to documentation of procurement decisions – stating that obtaining full documentation of pre-award decisions was neither practical nor required.
