President Obama released his 2011 budget proposal yesterday, with clean energy, oil tax breaks and nuclear energy playing starring roles, while cap-and-trade is still waiting to get into the game. A look across the spectrum of government agencies and a specific placeholder shows the commitment from the White House on the issue.
President Obama unveils the budget.
Starting with the EPA, the president’s budget invests significantly in fighting climate change, a common theme throughout.
- $21 million – an increase of $4 million from 2010 – to implement the Mandatory Greenhouse Gas Reporting Rule and ensure the availability of high-quality emissions data.
- $56 million– including $43 million in new funding – for the EPA and states to address climate change effectively through regulatory initiatives to control greenhouse gas emissions
- $25 million to aid states in permitting activities for greenhouse gas (GHG) emissions under the New Source Review and Title V operating permits programs
- $7 million to develop New Source Performance Standards (NSPS) to control GHG emissions from major stationary sources
- $6 million in new funding to implement the 2010 light duty vehicle rule and to develop regulations for large mobile sources
- $5 million to develop guidance regarding the best available practices and technologies to control GHG emissions under permitting programs
The Department of Energy’s budget allocates nearly $2.4 billion for clean energy projects, an industry the president yesterday called, “the driver,” of the nation’s future economy. It also spends more than $30 billion in loan guarantees for nuclear energy, making it seem like nuclear energy is the biggest “winner”. However, as Dave Roberts at Grist points out:
“As OMB chief Peter Orszag emphasized in a briefing call [yesterday] morning, the nuclear loan guarantees are meant to be fully repaid, while the renewable energy and energy efficiency money contains $500 million in credit subsidy. So there’s more direct spending on clean energy.
That’s with one big caveat, of course: that the nuclear industry doesn’t default on loans, sticking taxpayers with the liability.
A big caveat indeed.
While investing heavily into clean energy, President Obama also strengthened the industry by significantly cutting Big Oil tax breaks.
“To foster the clean energy economy of the future and reduce our reliance on fossil fuels that contribute to climate change, the Administration proposes to repeal tax provisions that preferentially benefit fossil fuel production. Oil and gas subsidies are costly to the American taxpayer and do little to incentivize production or reduce energy prices. Removing these subsidies would reduce greenhouse gas emissions and generate $36.5 billion of additional revenue over the next 10 years, an amount that represents only a small percentage of domestic oil and gas revenues — about one percent over the coming decade.
What this budget didn’t do was put forth an actual dollar amount for revenues from a potential cap-and-trade bill, like it did last year. Instead, it includes the line that the administration will, “work to enact and implement a comprehensive market-based policy that will reduce greenhouse gas emissions in the range of 17 percent in 2020 and more than 80 percent by 2050.”
That is obviously disappointing, but given the significant investments by the administration through other agencies, it is clear that clean energy and capping carbon are priorities. President Obama said himself that he did not need convincing the clean energy would be the future of the American economy. His budget shows that.
