Proposed Budget Cuts Target U.S. Innovation and Renewable Energy

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Republicans in the House Appropriations Committee today released a list of 70 proposed cuts to the federal budget this year that would have a drastic and harmful impact on future clean energy innovation and investment.

While perhaps a wonky and esoteric entity to the person whose life doesn’t revolve around federal budgets (i.e. 99.9999% of America), the House Appropriations Committee plays an outsized role in determining government spending amounts for the coming fiscal year.  Unfortunately, as detailed below, this year the new Republican leadership has proposed cuts that would be especially damaging to our new, growing green economy and national security.  Essentially:

  • $2.1 billion dollars would be cut from energy and science programs at the Department of Energy, representing a 20% cut. 
  • Efficiency and renewable energy technology programs would be the most damaged, taking a massive 35% hit in this proposed budget
  • Fossil fuels would only be cut half that amount, at 17%; nuclear programs would also be cut 17% 
  • Office of Science, one of the most important elements of our entire domestic innovation structure, would lose nearly a billion dollars in funding (18%) at a time we can least afford to cut investment in our future. 
  • Another key program, the Office of Electricity Delivery and Energy Reliability, which manages the reliability, efficiency and security of our electricity grid (as well as new smart grid technologies) would lose a fifth of its budget.

Sources: DOE Budget and Performance, National Journal, Environment&Energy News, **

The cuts to the DOE’s Energy Efficiency and Renewable Energy Program (EERE) are especially problematic.  Throughout the decades, EERE has pursued ground-breaking scientific and technological research, invested in innovative clean energy technologies and helped to demonstrate and deploy a wide range of reliable, clean and affordable energy sources.  To give just a partial list of the programs at risk from these cuts in EERE:

  • Next generation biofuels such as algae biodiesel or cellulosic ethanol R&D
  • PV and concentrating solar research programs (also the primary vehicles for the recent SunShot initiative to get solar power cheaper than $1/watt by 2020)
  • Offshore wind demonstration and innovation
  • Wave, tidal and ocean power research
  • Geothermal energy mapping and demonstration of new technologies
  • Advanced batteries, electric vehicles and more efficient vehicle technology development
  • Residential and commercial building efficiency technology programs (which gave us more efficient refrigerators, efficient windows and fluorescent lamps, saving us $30 billion)
  • One of the few federal programs remaining for improving the efficiency and productivity in manufacturing

This partial list doesn’t include programs to support state energy efforts, federal energy procurement, weatherization and conservation, or international clean energy.  (if you need more than this, much more detail can be found starting on page 3 here, or page 12 here). 

And yet these latest proposed budget cuts focus on EERE programs, leaving both nuclear and fossil energy programs less impacted.  More importantly, they ignore the many billions of dollars in cuts and offsets from unnecessary fossil fuel expenditures by the federal government.  Green Scissors 2010 lists $200 billion in cuts, including $31 billion alone in oil and gas subsidies and $19 billion in coal subsidies, while the offsets chapter in last year’s Green Budget lists tens of billions of potential savings. Last year’s recommended budget from the Obama Administration found $39 billion in tax breaks for oil, gas and coal companies that could be cut. 

I covered the importance of government investment in clean energy most recently here,  and a new DOE fact sheet on solar energy provides some excellent real-world examples that attest to the importance and power of federal support of renewables (in this instance - that a relatively small amount of funding ($50 million) in areas not seeing investment, can be leveraged into significant investment from the private sector ($1.2 billion)). 

We certainly recognize that we are currently in a challenging fiscal period, with a growing budget deficit, and we support calls for belt-tightening and improving the efficiency and effectiveness of government spending.  But if we are to compete globally in the coming decades, we cannot afford to reduce our investments in innovation and infrastructure in core 21st century technologies.  Nor can we continue to subsidize old, mature, 20th century energy technologies.  In the long-run, indiscriminate and outsized cuts to vital new clean energy programs are not a “solution” to our budget deficit, unless national security, economic growth, new jobs and improved productivity are no longer a priority.


** (as obvious in the chart above - the "Announced" cuts from the House Appropriations Committee (H.A.C.) are different from the "Actual" cuts.  The proposed budget cuts released by the H.A.C. today are actually calculated from the President's FY11 proposed DOE budget, which never passed through Congress, not the actual FY10 budget which was passed by Congress and is what all programs are currently funded off.  To determine the real funding impact, I had to back out the actual figure using both the President's budget and FY10 Approps.  In instances where the President had planned on reducing funding already, i.e. fossil fuel R&D, the impact is greater than outlined in the H.A.C.'s proposed cuts; where the President asked for an increase, i.e. most renewables, the impact of cuts from H.A.C. is reduced somewhat.)