Just before I left for SC2001, a long-expected letter arrived in Berkeley. It was the official DOE response to the NERSC Strategic Plan for 2002-2006, which we had developed earlier this year and submitted to DOE in May. In this letter to Berkeley Lab Director Charles V. Shank, dated November 8, 2001, Dr. C. Edward Oliver, Associate Director of Science for ASCR, accepted the broad outline of the strategic plan and committed to supporting NERSC at Berkeley Lab for the next five years. In these uncertain times, this is a strong commitment to NERSC by DOE. Even more satisfying was the fact that the letter concurred with many of the reviewers' observations that NERSC has provided "world-class hardware, timely technology upgrades and services virtually unsurpassed by any other computer center in the world." Dr. Oliver described the NERSC staff's commitment to excellence as a "vital attribute" of the center, and wrote, "Your proposal presents a sound strategy for providing high-performance scientific computing hardware and services in a manner commensurate with the near-term expectations of the Office of Science."

We can be proud of this recognition, which arrived at the end of another very successful year. The high point was NERSC's acceptance of the IBM SP platform, which by October 2001 had been upgraded to deliver almost 5 teraflop/s peak performance. With this new capability, NERSC will deliver 50 million processor hours of compute cycles annually to the DOE Office of Science research community. While many of our colleagues at other sites brag about terascale computing, I believe that in 2002, NERSC will be the first site where users routinely see their applications performing at teraflop/s level. Some are already achieving this, and their remarkable scientific accomplishments are described in this report.

After several years of planning, computational science in the DOE Office of Science finally received a big boost in 2001 through the funding of the Scientific Discovery through Advanced Computing (SciDAC) program. SciDAC opens up the opportunity to further develop and then deploy the results of recent computer science research. Computational science and computer science researchers in Berkeley excelled in the competition and obtained funding for many bold new projects. The leadership for three of the seven new "Integrated Software Infrastructure Centers" (ISICs) as well as for the DOE Science Grid is in the hands of researchers at Berkeley Lab. In addition, we participate in seven other SciDAC projects.

With DOE's recognition of Berkeley Lab and NERSC's leadership in computational science comes a big challenge: we are on the spot to make SciDAC a success. For NERSC as a facility, the challenge is to be ready for these new projects and to enable a whole new generation of computational science. I see it as my personal responsibility to make Berkeley Lab the place where the integration of the SciDAC projects will happen, and NERSC the facility where DOE scientists will first be able to reap the benefits of the newly developed technologies.

With SciDAC projects and the NERSC strategy firmly established, 2001 was the year when we set the agenda and directions for the next five years. With a time of intense new developments ahead of us, I am grateful to our DOE Office of Science sponsors for their continued endorsement of our ambitious plans. It continues to be a pleasure to collaborate with the NERSC Users Group and its executive board members. I would like to thank them for their continued support, especially for their effort to produce the next "Greenbook" documenting the computational requirements of the Office of Science community. My special thanks and congratulations, as always, go to the NERSC staff for their skill, dedication, and tireless efforts to make NERSC the best scientific computing resource in the world.