Securing Energy Supply Chains Act
- Sponsor
- Sen. Cotton, Tom [R-AR]
- Committees
- Energy and Natural Resources Committee (primary)
- Last action
- Jun 3, 2025
Bottom line
The bill aims to bolster U.S. energy supply chain security by restricting Department of Energy contracts with entities deemed threats to national security, economic security, or foreign policy, particularly those involved in critical materials and battery production.
What it actually does
This bill mandates the Secretary of Energy to establish and maintain an "Energy Non-Procurement List" of entities engaged in activities detrimental to U.S. national security, economic security, or foreign policy, with a focus on critical materials and battery supply chains. It prohibits the Department of Energy from entering into or renewing contracts with entities on this list, or with contractors whose supply chains include components from listed entities, though an exception exists for unavailability. The bill also requires an interagency study to identify and harmonize existing federal lists of problematic foreign entities.
Proponents argue
Proponents argue this bill is crucial for safeguarding national security and economic independence by reducing reliance on adversarial foreign entities for critical energy supply chain components. They assert it will encourage domestic or friendly-country production, protecting sensitive technologies and preventing hostile actors from undermining U.S. interests through economic leverage and supply chain vulnerabilities.
Opponents contend
Opponents might argue that such a broad prohibition could disrupt existing, often globalized, supply chains, potentially increasing costs for energy projects and slowing the deployment of clean energy technologies if domestic or friendly-country alternatives are not readily available or are more expensive. They may also raise concerns about the broad discretion given to the Secretary of Energy in determining which entities are 'detrimental' and the potential for political rather than purely security-based decisions.
The bill is short and relatively straightforward, allowing for a quick read and understanding of its core provisions and implications.
Section 3(a)
Establishment of Energy Non-Procurement List
This section requires the Secretary of Energy to create a list of entities determined to be engaged in activities detrimental to U.S. national security, economic security, or foreign policy. It prioritizes entities involved in critical materials and battery supply chains. The list must include 'foreign entities of concern,' entities on the Department of Defense's Chinese Military Company List, and entities with majority ownership of listed entities. The Secretary also has discretion to include other entities.
Supporters argue
Supporters argue this list is essential for proactively identifying and mitigating risks posed by adversarial foreign entities in critical energy supply chains, thereby enhancing national and economic security by preventing federal funds from supporting problematic actors.
Critics contend
Critics might express concern about the broad discretion granted to the Secretary in determining 'detrimental activities' and the potential for the list to be influenced by political considerations rather than purely objective security assessments, potentially leading to arbitrary exclusions.
Tradeoffs
This provision balances the imperative of national security against the potential for market disruption, increased administrative burden, and the need for clear, objective criteria in identifying entities.
Section 3(a)(4) and 3(b)
Annual List Revisions and Congressional Reporting
The Secretary is mandated to update the Energy Non-Procurement List at least annually, adding or removing entities as necessary. Concurrently, the Secretary must submit an annual report to specific Congressional committees, providing the unclassified list and a classified annex detailing the justifications for each inclusion or removal. The unclassified portion of the report must also be published on the Department of Energy's website.
Section 4(b)
Prohibition on Department of Energy Procurement
Beginning one year after the bill's enactment, the Secretary of Energy is prohibited from entering into or renewing contracts with any 'covered contractor.' A covered contractor is defined as a lead entity on a project that involves funding or procurement from an entity on the Energy Non-Procurement List, or from an entity that provides goods, services, or technologies containing components from a listed entity. An exception allows for contracts if the required goods, services, or technologies are not procurable otherwise, subject to conditions and monthly reporting by the contractor.
Section 5
Interagency Study on Overlapping Entity Lists
The bill requires the Secretary of Energy, in coordination with the Secretaries of Commerce, Defense, State, Treasury, the Director of National Intelligence, and other relevant agencies, to conduct a study within one year of enactment. This study will identify and compare existing federal lists related to foreign entities of concern, sanctioned entities, Chinese military companies, and other entities with which federal agencies are prohibited from contracting. The Secretary must then report to Congress with the study's results and recommendations for harmonizing these various lists.
The bill defines 'foreign entity of concern' by referencing section 40207(a) of the Infrastructure Investment and Jobs Act (42 U.S.C. 18741(a)). This external reference is critical because Section 3(a)(3)(A)(i) mandates the inclusion of any 'foreign entity of concern' on the Energy Non-Procurement List.
Section 2(2)
Why it matters:This is standard legislative practice to avoid reprinting lengthy definitions and to ensure consistency across federal statutes. However, it can obscure the full implications for a reader who does not cross-reference the external legal text.
Case for: Referencing existing law promotes consistency across federal statutes and avoids redundancy, ensuring that the definition aligns with established federal policy regarding foreign entities of concern.
Case against: It creates a barrier to full understanding for readers who do not have immediate access to or familiarity with the referenced statute, making it harder to quickly grasp the bill's full scope.
Estimated impact: Potentially broad, as the definition of 'foreign entity of concern' in 42 U.S.C. 18741(a) includes entities owned by, controlled by, or subject to the jurisdiction or direction of a government of a foreign country that is a 'covered nation' (China, Russia, Iran, North Korea), thereby automatically capturing a wide range of entities from these countries.
The bill defines 'covered contractor' to include not only general, prime, or other lead entities on a project involving DOE funding or procurement from a listed entity, but also from 'an entity that provides goods, services, or technologies that contain components from an entity on the Energy Non-Procurement List.'
Section 4(a)
Why it matters:This level of detail is necessary for effective enforcement and to prevent circumvention of the prohibition. It reflects a sophisticated understanding of modern global supply chains where components can originate from various sources. While technically precise, it adds complexity for compliance.
Case for: This broad definition is crucial for preventing circumvention of the prohibition and ensuring true supply chain security, as even small or obscure components can pose risks or provide leverage to adversarial entities. It ensures a comprehensive approach to de-risking.
Case against: Critics might argue this creates an excessively burdensome and potentially impractical due diligence requirement for contractors, who would need to trace components deep into their supply chains, potentially increasing costs, complexity, and project timelines, especially for complex manufactured goods.
Estimated impact: Significant, as it requires extensive supply chain mapping, auditing, and vetting for any contractor working with the DOE on projects related to critical materials or batteries. This could lead to substantial re-sourcing efforts and increased compliance costs across the industry.