Budget debate offers “different visions” for US energy future

15 February 2011

On Friday, House Republicans introduced legislation that would cut the US federal budget by $60 billion ($100 billion from President Obama’s requested 2011 budget). The proposed cuts were included in a “continuing resolution” bill to fund government operations through October 1. The bill must be passed by March 4 to avoid a government shutdown.

The proposal specifically targets the country’s clean energy and environmental programs, headlined by a $3 billion reduction in the Environmental Protection Agency’s (EPA) budget – a cut of nearly 30 percent compared with current levels. 

Other proposed clean energy and climate-related cuts include:

  • $1.4 billion from the Department of Energy (DOE) Loan Guarantee program – to commercialize high-impact clean technologies
  • $900 million from the DOE Energy Efficiency and Renewable Energy program
  • $250 million proposed for the Advanced Research Projects Agency-Energy (APRA-E) – to develop transformational energy technologies
  • An end to all funding for current and pending EPA greenhouse gas regulations on stationary sources

On Monday, President Obama proposed an alternative budget that would preserve funding for clean energy programs – increasing DOE’s budget by 12 percent, while cutting $4 billion in tax breaks for oil, gas and coal companies.

Amy Davidsen, US Executive Director for The Climate Group said: “This debate is about more than the budget deficit. It’s about two very different visions for the country’s energy future. Both sides are cutting spending. But by cutting existing clean energy programs, the House Republicans are proposing continued dependence on fossil fuels. By cutting subsidies for fossil fuels, the President is proposing a cleaner, more prosperous future.”

The Republican proposal would also eliminate about $500 million in proposed funding for the World Bank’s Clean Investment Funds (CIF), which help developing countries transition to clean energy. And it would cut proposed funding for the Global Environment Facility (GEF) from $90 million to $32 million. Both programs are considered key components of the US’s contribution to “fast-start” financing under the Copenhagen Accord.  

Evan Juska, Head of US Policy for The Climate Group said: “The positive outcome in Cancun opened up a whole new range of possibilities for countries to cooperate on clean energy and climate change. But for cooperation to work, everyone needs to do their part. If the US contribution to fast-start finance is cut, it will seriously hurt US credibility in the negotiations, limiting its ability to benefit from international cooperation.”

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