Trump’s clean energy budget cuts would ‘devastate’ an emerging economic sector

Budget plan calls for elimination of ARPA-E, major cuts to renewables research.

Funding of renewable energy research was targeted in President Donald Trump’s fiscal year 2018 budget request for the Department of Energy. CREDIT: AP Photo/Matt Young
Funding of renewable energy research was targeted in President Donald Trump’s fiscal year 2018 budget request for the Department of Energy. CREDIT: AP Photo/Matt Young

President Donald Trump’s 2018 budget would make huge cuts in renewable energy research and eliminate agencies within the Department of Energy that fund energy technology projects.

In its official FY18 budget, released Tuesday, the Trump administration proposed the termination of the Advanced Research Projects Agency-Energy (ARPA-E), a bipartisan initiative that funds research into cutting-edge energy technology. The decision to eliminate ARPA-E was “in line with administration policies,” according to the budget request.

Clean energy research took another major hit with the administration’s proposal to reduce the budget of the Department of Energy’s Office of Energy Efficiency and Renewable Energy (EERE) to $636 million, about $1.4 billion, or 70 percent, below the FY16 enacted level for the office.

“The budget for DOE demonstrates the administration’s commitment to reasserting the proper role of what has become a sprawling federal government and reducing deficit spending,” the administration said in the budget request. “It reflects an increased reliance on the private sector to fund later-stage research, development, and commercialization of energy technologies and focuses resources toward early-stage research and development.”

Sen. Maria Cantwell (D-WA), ranking member of the Senate Energy and Natural Resources Committee, criticized Trump for his proposed cuts in clean energy research. “His budget proposes a staggering seventy percent cut to renewables and energy efficiency initiatives,” Cantwell said in a Tuesday statement responding to the budget proposal. “This would devastate an emerging sector of our economy by killing thousands of clean-energy jobs all over the country — all in a misguided effort to hold onto the past at the expense of our future.”

DOE has “a long proud history of acting as an incubator for innovation with bipartisan support and that tradition won’t end now” with the release of Trump’s FY18 budget proposal, she added.

Under the administration’s plan, EERE will focus its limited resources on early-stage research and development, “where the federal role is critically important,” the budget proposal said. The cuts also reflect an increased reliance on the private sector to fund later-stage research, development, and commercialization of energy technologies, according to the proposal.

The Trump administration also wants to eliminate the Title XVII clean energy projects loan program. DOE was authorized to provide the loan guarantees, which are used to accelerate the deployment of clean energy technology, under Title XVII of the Energy Policy Act of 2005.

The administration’s budget request also calls for the elimination of the Energy Star program, which is jointly housed at the Environmental Protection Agency and DOE. Energy Star, widely viewed as a successful federally run program, enjoys nearly 90 percent brand awareness and has helped lower energy bills across the United States.

CREDIT: AP Photo/Jon Elswick
CREDIT: AP Photo/Jon Elswick

More than a thousand business owners wrote a letter to members of Congress last month urging the lawmakers to strengthen Energy Star “to ensure it continues providing these important benefits to the public while helping us meet our energy and environmental goals.”

In response to the budget’s release, the renewable energy sector expressed concern with the administration’s priorities. “We were disappointed to see the administration’s proposal to slash programs that promote American-made clean energy,” Abigail Ross Hopper, president and CEO of the Solar Energy Industries Association, said in response to the budget proposal. “Clean energy research programs have been priorities of both Republican and Democratic administrations and Congresses and the investments have paid off many times over.”

It’s unclear whether Trump’s proposed spending cuts will find widespread support in Congress. “We look forward to working with Congress as it drafts a budget that supports important clean energy programs that create American jobs, advance innovation and stimulate billions of dollars in private investment,” Ross Hopper said.

In recent weeks, Republican lawmakers have also called on the administration to resist major cuts to certain DOE programs. A group of six prominent GOP senators wrote a letter to Trump last week urging him to continue investing in several DOE programs, including ARPA-E and EERE.

Overall, Trump requested $28 billion for DOE, a $1.7 billion, or 5.6 percent, decrease from the 2017 annualized continuing resolution level. The administration drew attention to a $1.4 billion, or 11 percent, increase above the 2017 annualized level for the National Nuclear Security Administration, a semi-autonomous agency within DOE responsible for enhancing national security through the military application of nuclear science.

Under the plan to cut EERE spending, DOE will reduce the office’s full-time employees by about 30 percent from the FY16 level. “Remaining staff will ensure continuity of the essential oversight activities for EERE’s project portfolio and maintaining proper stewardship of taxpayer dollars,” the administration said.

The shift away from later-stage development and deployment activities and the increased focus on early-stage R&D at EERE “provides an opportunity to reorganize and move toward a more efficient organizational structure,” it said.

The FY18 budget request provides $1.9 billion for energy R&D activities — $2.3 billion below the FY16 enacted level. Even the budget for fossil energy research and development was targeted in Trump’s proposal. Fossil R&D would total $280 million, a $352 million drop from the FY16 enacted level. Despite the proposed cuts, the Trump administration said the fossil R&D budget will allow the federal government to help advance clean coal technologies.

The budget request proposes to eliminate ARPA-E, with operations winding down in 2018 and the office shutting down in FY19, at which point remaining monitoring and contract closeout activities would be transferred elsewhere within DOE.

The administration’s FY18 budget requests an appropriation of $20 million to fund the winding down of operations. Before Trump’s FY18 budget was released Tuesday, several dozen House Democrats questioned Energy Secretary Rick Perry about a delay in the disbursement of ARPA-E funds to project teams that were already selected for awards. Funding for these ARPA-E awards was approved in previous budgets, for fiscal years 2016 and 2017.

“The budget assumes that a plan will be developed in FY 2018 to ensure that prudent monitoring and management of ARPA-E contracts and responsible stewardship of taxpayer funds continues after the ARPA-E office closes,” the administration said.