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In a Congressional hearing today Democratic lawmakers stressed the importance of engaging small firms when it comes to developing renewable energy, fighting climate change and reducing energy costs. After the Department of Energy’s (DOE) failure to meet their small business contracting threshold, Members of the House Small Business Committee pressed for additional investments in small businesses participating in the energy economy. 

“Technological advances, consumption changes in the modern economy, and continued interest in renewable energy have driven changes in energy investment,” said Rep. Brad Schneider (D-IL) the Ranking Member of the Subcommittee on Agriculture, Energy, and Trade, which held the hearing. “Small businesses are a vital part of this equation and their contributions must be utilized though the federal contracting process.” 

Every year, the federal government procures more than $400 billion in goods and services from businesses around the country through government contracts. The Small Business Act sets a goal of awarding 23 percent of federal contracts to small businesses. According to the Federal Procurement Data System-Next Generation (FPDS-NG), in 2016 the Department of Energy awarded just 5.39% of federal contracts to small firms overall, 1.22% to 8(a) firms, 0.65% to Service Disabled Veteran owned firms, 1.24% to Women owned firms, and 0.15% to HUBZone firms. When accounting for the numbers under the management and operating contracts the agency holds in its Management and Operating Subcontract Reporting Capability (MOSRC), as of December 30, 2017 DOE has achieved 8.64% of its 10.2% prime small business goal target and in the subcategories, 3.08% of the 5.0% goal for Small Disadvantaged Businesses; 2.07% of the 5.0% goal for Woman Owned Small Businesses; 0.38% of the 3.0% goal for Service Disabled Veteran Owned Small Businesses; and .34% of the 3.0% goal for HUBZone Businesses.  

“When President Obama released his Climate Action Plan in 2013, he prioritized research into clean and renewable energy sources as well as a need to invest in American energy companies,” Schneider added. “Across the country, innovative small firms are hard at work making our planet healthier and more sustainable, and they must receive a fair shot at securing government contracts.” 

In today’s hearing, lawmakers examined the role of Offices of Small and Disadvantaged Business Utilization— or OSDBUs. The purpose of OSDBUs is to advocate for small business inclusion within each agency, and they serve a vital role in helping small firms secure both prime and subcontracting opportunities. Currently, the DOE OSDBU runs two outreach programs to help engage small businesses in the procurement process, an annual small business expo and a mentor- protégé program. Despite these efforts, DOE’s failure to meet broader small business contracting goals prompted lawmakers to examine the need for additional investments in small business procurement programs. 

“Considering the scope of opportunity that small firms have to contribute to America’s commitment to clean and renewable energy, we must take a hard look at how Congress can help more small businesses secure a seat at the table,” said Schneider. “As populations around the world grapple with the devastating consequences of climate change, it is vital that the DOE participate in the federal marketplace to the maximum extent practicable.” 

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