Posts tagged “budget”
The House Energy and Water Appropriations subcommittee voted this week on an energy appropriations bill that decimates federal investment in clean energy innovation in the name of prioritizing funding for national security and economic growth. This bill presents the harshest proposed cuts to energy innovation programs in the last two years, cutting total funding for key Department of Energy offices by nearly 20 percent from already-sequestered FY2013 levels.
To make matters worse, the most significantly impacted programs under the proposal are arguably the most important efforts for ensuring the future growth of clean energy in the United States. The legislation cuts the Office of Energy Efficiency and Renewable Energy (EERE) budget by 43 percent from FY2013 levels under sequestration, or nearly 65 percent from the President’s requested levels for FY2014. EERE’s responsibility as the “connective tissue” of the U.S. energy innovation ecosystem, as well as its efforts to enable and develop an advanced manufacturing sector in the United States would likely be derailed by such significant funding cuts. CONTINUE»
The impacts of budget sequestration are slowly being unveiled to the general public. Furloughs at the Federal Aviation Authority (FAA) led to air traffic gridlock and angry travelers. Parks and national tourist sites are cutting back hours. And the Department of Defense (DOD) recently announced furloughs for 680,000 civilian employees. While these short-term impacts are painful, in particular to those losing work hours and income, sequestration is initiating cuts with negative, long-term impacts, which are not yet immediately apparent.
One area of specific concern is the potential $381 million in cuts to energy innovation investments at the DOD – a 25 percent cut compared to FY2012 levels. Since 2009, DOD has invested $5 billion in clean energy research, development, testing, demonstration, and procurement, representing almost 25 percent of U.S. clean energy funding in FY2012. DOD’s focus on clean energy innovation is important for three reasons:
- The DOD has been the source of some of the last century’s most important breakthrough technologies, including the Internet, GPS, and microchips and it could have a similar impact on clean energy technologies like batteries and smart grid;
- The DOD has developed its own cohesive innovation ecosystem that bridges its investments in research to its procurement budget and actual use of new technologies in the battlefield, which allows for accelerated pathways for technology development;
- The DOD budget is typically not politically controversial in comparison to other sources of energy innovation investment like the Department of Energy, assuring consistent funding over time rather than periods of boom and bust.
During the past five years DOD has quickly ramped up its energy innovation investments to address strategic challenges impacting warfighters, such as protecting liquid fuel supply lines and addressing the geopolitical consequences of climate change. But budget sequestration threatens to slow, or even halt, these efforts.
The military has been a leader in the development of biofuels – for good reason. As I’ve written before, the military’s single-source dependence on petroleum for fuel is a strategic vulnerability. Oil has a monopoly on energy supply for 80% of our military’s energy needs, including virtually all of the non-nuclear transportation. To simply accept that oil is going to remain as the sole source of liquid fuel that the US military relies on for its transportation, operations, and training is to say that we should accept the long-term strategic risks of price volatility and dependence upon uncertain foreign countries.
We should remember that, even if the military uses oil solely from the United States and its allies, the price that the Defense Logistics Agency pays for oil is largely set by global market conditions – and saying that those are highly vulnerable to conflict and unrest in the Middle East is an understatement.
Last year, in an attempt to address this threat, the Department of Defense, the Department of Agriculture, and the Department of Energy were authorized under the Defense Production Act (DPA) to support the development of an alternative source of fuel. The funding agreed in a joint memorandum, and appropriated by Congress, each agency will invest $170 million over three years in helping to build a domestic biofuel industry (read more about the DoD’s biofuels policy here). This funding will be matched by investment from the private sector. Over the past several months, the agencies have been deliberating over which companies will partner with the government.
President Obama released his long-awaited FY2014 budget request and while it’s unlikely the budget will be taken up by Congress in its entirety, it remains an important document. Namely, the proposal is significant because it steadfastly argues that America can continue to support next-generation industries like clean energy. In fact, the President’s proposal budgets for a number of high-profile, high-impact programs, including those aimed at growing the domestic clean energy manufacturing sector, reduce transportation fuel use, and calls on Congress to fund a new Energy Innovation Hub to transform the electricity grid.
Across the board, the FY2014 request boosts key energy innovation offices at DOE by about 15 percent compared to the FY2013 Continuing Resolution and seven percent higher than the President’s FY2013 request. The lion’s share of budget gains are aimed at the Office of Energy Efficiency and Renewable Energy (EERE), which would see a budget increase of 54 percent from FY2013 CR levels, and at the Advanced Research Projects Agency-Energy (ARPA-E), which would see a budget increase of 46 percent.
Expanding Research Capabilities in Advanced Energy Manufacturing
The largest budget increase target at EERE – 22 percent to be exact – is for the department’s Advanced Manufacturing Office, which invests in transformational research and development of integral clean energy manufacturing technologies and practices. This investment would support and complement EERE’s recently announced Clean Energy Manufacturing Initiative, which aims to aggressively increase the international competitiveness of emerging energy manufacturing. The program is designed to begin reversing a decade’s long decline in U.S. manufacturing – immediate goals include transferring new research, technologies, and industrial education and training to industry through a new research institute under the banner of the President’s National Network of Manufacturing Innovation as well as EERE’s Better Plants Challenge.