The Insider

Air Force officials have delayed the decision on whether to built a privately owned coal-to-liquids refinery on unused land at Malmstrom Air Force Base in Montana, service officials tell Inside the Air Force.

Air Force Times, citing a service spokesman, reported this week that the Air Force was expected to announce the results of the decision -- which was supposed to have been made last Friday -- this afternoon.

However, “Due to some technical issues and clarifications that still need to be made, no decision was made on Friday,” reads a Jan 21 e-mail from the same Air Force spokesman, Gary Strasburg. The decision likely will be made in the next two weeks, said Stasburg later this afternoon. He did not elaborate on the reasons behind the delay.

If built, the refinery could produce up to 20,000 gallons of coal-based fuel each day, Air Force officials said in late 2007 when they announced plans to build the plant. Service energy officials have long touted the plant as a major step toward the service's ultimate goal of being able to fly 50 percent of all stateside missions on synthetic fuel by 2016.

The Malmstrom plant would sit on property leased to its operators at a discount in exchange for a significant price break on the fuel produced there. The Minuteman III ICBM base -- which no longer has fixed-wing flight operations -- has plenty of unused land and sits near some of the world's largest coal deposits, service officials have said.

The plan to use coal-based synthetic fuel in Air Force planes has come under scrutiny over the past year as opponents have pointed out that so called “clean coal” technology does not exist outside of the laboratory. Using current technology, coal-based fuel emits far more greenhouse gases than standard jet fuel. Furthermore, Section 526 of the 2007 Energy Independence and Security Act prohibits the service from buying fuel that emits more greenhouse gases than conventional fuel.

This could be a major hurdle in getting investors to pony up the billions in cash for such a plant because the Air Force would not be able to sign long-term contracts for fuel that pollutes more than standard jet fuel.

However, Kevin Billings -- acting assistant secretary of the Air Force for installations, logistics and environment -- told Inside the Air Force last week that the service is launching a plan to certify its planes to fly on biofuels made from feedstocks like algae and biomass. He did not provide a time line for this effort.

Several politically appointed defense environmental officials, including top DOD environment chief Wayne Arny, will be staying in their posts temporarily under the Obama administration until their replacements are named, sister publication Defense Environment Alert's Stuart Parker reported this week:

Political appointees requiring Senate confirmation may take some time to replace, DOD sources indicate, with the most senior posts being filled first. Other officials, meanwhile, are either leaving voluntarily on Jan. 20 or have been asked by the Obama transition team to vacate their positions.

Arny, deputy under secretary of defense for installations and environment, will be staying until a replacement is found, but the number two environment official, Alex Beehler, who is DOD assistant deputy under secretary for environment, safety and occupational health, was slated to officially leave his position by Jan. 16. Neither of these positions requires Senate confirmation.

At the Army, Keith Eastin, assistant secretary of the Army for installations and environment, will also stay for the time being, along with the Army’s top energy executive Paul Bollinger and the Army Secretary himself Pete Geren, sources confirm.

At the Navy, it is now clear that Donald Schregardus, deputy assistant secretary of the Navy for environment, will stay until replaced, and Navy Secretary Donald Winter will remain until March 13, unless the president names a replacement first.

President Obama's White House Website was up and running within minutes of his oath of office -- and while it lacks detail it does include a statement on his defense priorities.

A taste:

* Fully Equip Our Troops for the Missions They Face: Barack Obama and Joe Biden believe we must get essential equipment to our soldiers, sailors, airmen and Marines before lives are lost.

* Review Weapons Programs: We must rebalance our capabilities to ensure that our forces can succeed in both conventional wars and in stabilization and counter-insurgency operations. Obama and Biden have committed to a review of each major defense program in light of current needs, gaps in the field, and likely future threat scenarios in the post-9/11 world.

* Preserve Global Reach in the Air: We must preserve our unparalleled airpower capabilities to deter and defeat any conventional competitors, swiftly respond to crises across the globe, and support our ground forces. We need greater investment in advanced technology ranging from the revolutionary, like Unmanned Aerial Vehicles and electronic warfare capabilities, to essential systems like the C-17 cargo and KC-X air refueling aircraft, which provide the backbone of our ability to extend global power.

* Maintain Power Projection at Sea: We must recapitalize our naval forces, replacing aging ships and modernizing existing platforms, while adapting them to the 21st century. Obama and Biden will add to the Maritime Pre-Positioning Force Squadrons to support operations ashore and invest in smaller, more capable ships, providing the agility to operate close to shore and the reach to rapidly deploy Marines to global crises.

* National Missile Defense: The Obama-Biden Administration will support missile defense, but ensure that it is developed in a way that is pragmatic and cost-effective; and, most importantly, does not divert resources from other national security priorities until we are positive the technology will protect the American public.

* Ensure Freedom of Space: The Obama-Biden Administration will restore American leadership on space issues, seeking a worldwide ban on weapons that interfere with military and commercial satellites. They will thoroughly assess possible threats to U.S. space assets and the best options, military and diplomatic, for countering them, establishing contingency plans to ensure that U.S. forces can maintain or duplicate access to information from space assets and accelerating programs to harden U.S. satellites against attack.

* Protect the U.S in Cyberspace: The Obama-Biden Administration cooperate with our allies and the private sector to identify and protect against emerging cyber-threats.

More agenda items here.

Count NATO Secretary General Jaap de Hoop Scheffer as one of the international dignitaries delivering congratulations to the newly inaugurated President Obama.

"On behalf of the Atlantic Alliance, I warmly congratulate Barack Obama on his inauguration as the 44th President of the United States of America," de Hoop Scheffer said, according to a note posted on the NATO Web site today.

"President Obama takes up his responsibilities at a time when the international community faces great challenges, but also great opportunities to build a safer, more secure world. The NATO Allies, including the United States, stand together to help reach that goal.

"The United States has played a leading role within NATO since the Alliance was founded in 1949. I have no doubt that President Obama will carry on that tradition. We look forward to welcoming him to his first NATO Summit in April, in Strasbourg and Kehl, as we will celebrate NATO's 60th Anniversary and chart the way forward for the Atlantic Alliance," de Hoop Scheffer said.

In the search for that new way forward, alliance members must be encouraged by Obama's pledge to work through international organizations in tackling security problems worldwide.

But the Obama presidency could also force some uncomfortable issues for the European NATO members. With the hugely unpopular Bush administration now over, countries like Germany might find it more difficult to deny requests for more troops or more operational flexibility of their forces in Afghanistan.

Amid the buzz about the upcoming Quadrennial Defense Review and deliberations about the Pentagon's strategic realignment in an Obama administration, the congressionally mandated Space Posture Review marks another review worth watching this year.

Michèle Flournoy, in line to be the under secretary of defense for policy, considers the topic important enough that she said she would play a "leading role" in the drill. This is according to written answers she provided to the Senate Armed Services Committee in preparation of her confirmation hearing yesterday.

Lawmakers requested the Space Posture Review, a joint effort between the Defense Department and the Office of the Director of National Intelligence, in the fiscal year 2009 defense authorization legislation. A final report is due to Congress on Dec. 1.

The ten-year outlook is supposed to touch on virtually everything space-related, including the topics of space situational awareness, offensive and defensive space operations, acquisition and arms control, according to the legislation.

William Lynn, president-elect Obama's nominee to be the Pentagon's No. 2 official, said today that the new Defense Department leadership plans three large-scale reviews of program and budgets including a scrub of war costs, the base budget and the Quadrennial Defense Review.

Lynn told the Senate Armed Services Committee during his opening remarks at his confirmation hearing this morning that, if confirmed by the Senate for the job, he plans to examine the balance of the fiscal year 2009 war cost request, look at the fiscal year 2010 defense budget proposal and ensure “expeditious completion” of the Quadrennial Defense Review.

He said the QDR will be used to set a new blueprint to “lay out an effective force” to deal with a wider range of security challenges, including boosting capabilities to deal with irregular operations.

More on the QDR:

• Gates Plans Early QDR Decisions to Influence FY-10 Obama Defense Budget

The Senate Armed Services Committee has begun its hearing to consider William Lynn to be deputy secretary of defense; Robert Hale to be Pentagon comptroller; Michèle Flournoy to be under secretary of defense for policy; and Jeh Charles Johnson to be the Pentagon's general counsel.

While introductions are being made, we're perusing the written responses to advance policy questions from the committee.

A big question for the incoming Obama Pentagon team -- which during the presidential campaign was highly critical of the practice of funding operations in Iraq and Afghanistan with supplemental appropriations -- is how they will handle war costs.

Robert Hale, nominee for the comptroller job, in his prepared responses says:

If confirmed, I would hope to work with Congress and the Office of Management and Budget to try to move away from supplementals. The feasibility of moving away from supplementals depends on the budget year.
* For FY 2009, DoD needs a supplemental, because the base budget has been enacted.
* For FY 2010, with limited time available for submission of a base budget request, and with continuing uncertainty about changing war requirements, the President may decide he will need to have a supplemental.
* In later budgets, we should be better able to minimize dependence on supplementals.
* Regardless of the year, we should avoid including predictable costs in supplemental requests.

Can supps be fully integrated into base budgets, the committee asks?

* Full elimination of supplementals would require substantial reduction in the uncertainties associated with wartime operations. However, the negative aspects of supplementals can be minimized by ensuring DoD scrutiny of supplemental requests similar to that afforded the base budget (a policy endorsed by the President-elect) and by providing Congress with early information regarding supplemental requests.
The committee notes that in "recent years the department has had to prepare a base budget and two separate supplemental funding requests each year.
Do you believe the Comptroller organization has the personnel and other resources needed to adequately manage this increased workload?"
* I am concerned about the adequacy of resources in the Comptroller organization to manage the increased workload associated with wartime operations.
• If confirmed, I will carefully review the staffing and organization and recommend any changes that I believe are required.