Energy Efficiency and Renewable Energy Budget for FY 2013

On March 2, 2012, the Environmental and Energy Study Institute (EESI) and the House Renewable Energy and Energy Efficiency Caucus hosted a briefing on the President’s budget request for energy efficiency and renewable energy for FY 2013. As the administration and many Congressional leaders call for increased investments in clean technology to create jobs, improve national energy security, and ensure the United States remains competitive globally, federal agencies and the Congress also are looking for innovative ways to stretch and trim budgets in a tight fiscal environment. At this briefing, representatives from the Department of Energy (DOE) and the Congressional Research Service gave an overview of requested funding levels for various programs, the budget priorities and their justification, and provided context on how these requests compare to overall energy funding in previous years. Speakers for this event included:

• Henry Kelly, Acting Assistant Secretary, U.S. Department of Energy, Energy Efficiency and Renewable Energy
• Fred Sissine, Energy Policy Specialist, Congressional Research Service (CRS)
• Scott Sklar, Chair, Steering Committee, Sustainable Energy Coalition; President, Stella Group, Ltd.

 

Highlights From Speaker Presentations:

 

• The Obama administration recognizes energy as a major driver of the economy, and is committed to an “all of the above” energy policy. Emphasis is on transformation to a clean energy economy, maintaining international competitiveness through domestic manufacture, combating climate change by reducing carbon emissions, and decreasing dependence on foreign oil.
• The EERE FY 2013 budget increased funding for a diverse range of technologies, but cut funding to Water Power and Hydrogen/Fuel Cell, saying that these programs do not currently need steady funding. The 25 percent EERE budget increase is offset by cuts to oil and gas subsidies.
• The DOE’s Buildings Technologies programs is focused on improving building components, such as building shells, and HVAC fluids, and on creating buildings as self-monitoring, efficient systems. The program seeks to accelerate new standards and to overcome costs, industry structure and market failure barriers to implement technology, especially through Appliance Standards, the Better Buildings challenge, and the Solar Decathlon.
• The DOE Vehicle Technologies program is investing in alternative propulsion methods, efficient motors and better batteries with fewer critical materials. There is also a funding increase for the Electric Vehicle Grand Challenge.
• DOE’s Advanced Manufacturing programs received the largest budget increase. Advanced manufacturing techniques reduce material waste and energy use and keep the United States on the cutting-edge of innovation, creating and maintaining domestic manufacturing opportunities. Special attention is on additive manufacturing, new separation methods, advanced materials (including carbon fiber), titanium processing, streamlining industrial processes and public-private partnerships.
• The DOE’s Federal Energy Management program continues to use Energy Service Company Contracts, which allow contracts with outside party to finance renovations that update and increase efficiency of federal facilities.
• The DOE Weatherization and Intergovernmental Activities Program helps train workers and get new technology out on the market. Through the Weatherization Assistance Program, 130,000 houses have been renovated since 2009.
• State and Tribal programs saw a small decrease in funding from FY 2012, returning totals to historic levels prior to the American Recovery and Reinvestment Act of 2009.
• A focus on research development and innovation in alternative energy programs:

1. Solar: focus on bringing the cost of photovoltaic (PV) elements down below $1/watt. Much of this decrease will include reducing regulatory costs.
2. Wind: innovation in offshore wind production, particularly attractive for populations concentrated on coasts.
3. Geothermal: locating “hard to find” geothermal sources, designing equipment to withstand heat and pressure, and designating “test sites” for trying new technologies
4. Biomass: Identify and increase sources of biorefinery feedstocks and improve conversion technology. Combined Department of Energy/Agriculture/Defense military biofuels program.
5. Water: Research and development of marine and tidal power, improvements to conventional hydro. Hydropower is currently held back by regulatory procedures and the need to review existing information and does not need as much R&D funding in FY 2013.

The President’s FY 2013 budget request for DOE overall would increase funding by 3.2 percent from 2012 enacted levels to $27.2 billion. The proposed budget increases funding for clean energy, research and development, and advanced manufacturing. The Office of Energy Efficiency and Renewable Energy (EERE) would receive $2.3 billion, up from $1.8 billion in FY 2012 appropriations. Within the EERE budget, Water Power would be cut 66 percent and the hydrogen Fuel Cell Technology program would be decreased by 23 percent from FY 2012 appropriations. All other renewable and energy efficiency programs would see an increase in budget over FY2012 appropriation levels, with the exception of the leveraged State Energy and Tribal programs. The budget also provides $350 million for the Advanced Research Projects Agency - Energy, an increase of 27 percent.

The Department of Defense and the Department of Interior also provide some funding for renewable energy and efficiency. However, the Department of Agriculture provides hardly any new funding for the Farm Bill energy title – a major change from prior years.