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Energy Budget Holds Major Cuts


Steven Chu(Liz Lynch)

President Obama’s proposed 2012 budget for the Energy Department slashes spending for hydrogen and fossil fuel research programs by almost 50 percent and shutters parts of two national labs, according to a fact sheet on DOE’s budget obtained by National Journal.

“Fiscal responsibility demands shared sacrifice – it means cutting programs we would not cut in better fiscal times,” Energy Secretary Steven Chu said in an e-mail sent out today to all DOE staff, labs, and sites.


As Obama called for in his State of the Union address, DOE’s budget eliminates $3.6 billion worth of oil and gas subsidies. It also repeals coal subsidies, which the president did not mention in his speech last month. Obama has made such cuts in his past two budget proposals, but they never got Congress's approval.  And he isn't expected to get it this time either, given that he's dealing with a GOP-controlled House and a more conservative Senate than the one in the last Congress.

The budget will also include more than $8 billion for research, development and deployment investments in clean energy technology programs, as Obama previewed in his address.

The budget cuts the hydrogen technology program within the Office of Energy Efficiency and Renewable Energy by more than 41 percent, or almost $70 million, “in order to focus on technologies at large scale in the near term,” the e-mail says. The administration has been trying to cut this budget for years. Retired Sen. Byron Dorgan, D-N.D., had always put the money back in because a prominent university in North Dakota has a hydrogen research lab. But given Dorgan retired last year, that won’t be an issue this time.


The Office of Fossil Energy’s budget is cut by 45 percent, or $418 million. “This includes zeroing out the Fuels Program, the Fuel Cells Program, the Oil and Gas Research and Development Program, and the Unconventional Fossil Technology Program,” the e-mail states. The administration’s past two budgets have also slashed funding for fossil fuels.

The Tevatron facility at Fermi National Laboratory in Illinois and Holifield Radioactive Ion Beam Facility at the Oak Ridge National Laboratory in Tennessee would be closed if this plan is enacted. This would save the administration $35 million and $10 million, respectively. DOE announced in January that it would end operation of the facility in Tennessee. 

CORRECTION: This version of the story makes clear that President Obama’s proposed 2012 budget for the Energy Department shutters parts of two national labs.

Coral Davenport contributed. contributed to this article.

This article appears in the February 11, 2011 edition of National Journal Daily PM Update.

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