The Trump administration released its fiscal 2021 budget request yesterday, outlining key priorities at the Department of Energy and other energy-related agencies.
The budget, while largely dead on arrival in Congress, highlighted priorities for Energy Secretary Dan Brouillette and revealed shifts in administration policies, including on the Yucca Mountain nuclear waste depository (Greenwire, Feb. 10).
The administration also proposed selling 15 million barrels from the Strategic Petroleum Reserve to fund other department priorities, including the "comprehensive remediation" of an oil field in Elk Hills, Calif.
The budget further called for investments in cybersecurity and energy storage but would slash money for the DOE office that develops some of the efficiency standards President Trump complains about on the campaign trail.
On renewables, there were steep proposed cuts at DOE but a proposed boost for offshore wind at the Interior Department. As in previous years, the administration called for elimination of the Advanced Research Projects Agency-Energy and DOE’s loan program.
Some of the items included perennial efforts, such as seeking to sell off publicly owned transmission lines, that are likely to be ignored by Congress.
Here’s six energy takeaways from the White House plan:
EERE in detail
The administration would slash DOE’s Office of Energy Efficiency and Renewable Energy by 75%, from $2.85 billion to $720 million.
Within that, the proposed cuts to EERE would reduce spending on solar energy technology from $280 million to $67 million and cut investment in wind technology from $104 million to $22 million, according to DOE documents reviewed by E&E News.
The administration argued that some of the DOE cuts would protect taxpayers "by eliminating costly, wasteful, or duplicative programs."
Congress has rejected previous efforts to cut spending on renewables and energy efficiency standards, and advocates pledged yesterday to work with Congress to retain the money.
"These investments are not only helping the U.S. lead the world in the development of energy efficiency technology, but they have a direct impact on Americans’ lives," said Ben Evans, vice president of government affairs at the Alliance to Save Energy.
Environmental advocates have criticized the administration for looking to roll back efficiency standards, and the budget proposal says it will help DOE target "unnecessarily burdensome energy efficiency regulations."
Citing the Trump administration’s decision in December 2019 to block the planned 2020 phaseout of less energy-efficient lightbulbs, the budget document said DOE "will pursue improvements to other household appliances through its standards program to improve product efficiency and meet the everyday needs of American households."
Energy storage ‘launchpad’
Building off an announcement last month, DOE’s request would set aside $190 million in total for the Energy Storage Grand Challenge program.
DOE is looking to launch a dedicated cross-program research effort for grid-scale storage meant as a 10-year challenge to reduce the costs and deployment of storage technologies, similar to DOE’s SunShot Initiative for solar.
That total funding includes $40 million for a "Grid Storage Launchpad" within the Office of Electricity. EERE, meanwhile, would see $97 million dedicated to supporting the Energy Storage Grand Challenge.
"The next generation of batteries, we think, will revolutionize how renewable energy can be integrated into the grid," said Brouillette in a call with reporters. "It will make wind and solar more reliable."
DOE has yet to identify the specific goals it would like to achieve with the challenge. The push to define them will start "soon" with a request for information on the key questions and issues the challenge should address, DOE said in announcing the new effort last month.
Federal power market sale
The Trump administration again proposed selling the transmission assets of the Tennessee Valley Authority and three of DOE’s power market administrations: the Bonneville Power Administration in the Pacific Northwest; the Southwestern Power Administration, which covers parts of the Midwest and Southeast; and the Western Area Power Administration, which covers 15 central and Western states.
Such a sale, the White House said, would save an estimated $4.1 billion over 10 years on the federal deficit.
The proposal would also include an attempt to boost the rates charged by the power administrations.
Instead of being limited to charging cost-based rates, the publicly owned utilities could charge market-based rates, which the administration says would be a "commonsense shift that lessens the burden on the federal taxpayer."
"Ownership of transmission assets is best carried out by the private sector where there are appropriate market and regulatory incentives," the administration said in its request. "Eliminating the federal government’s role in owning and operating transmission assets would encourage a more efficient allocation of economic resources and mitigates unnecessary risk to taxpayers."
Congress has previously rejected the proposal, with Senate Energy and Water Development Appropriations Subcommittee Chairman Lamar Alexander (R-Tenn.) saying privatization would "effectively destroy" the utility.
"This loony idea of selling TVA and TVA’s transmission lines seems to keep popping up regardless of who is president, and each of those proposals have all been soundly rejected by Congress," Alexander said in 2018 when Trump floated the idea.
Warning that U.S. businesses, hospitals and private citizens are "no match against a nation-state such as China, Iran, North Korea, or Russia attempting to hack their network," the proposed budget would increase some spending to "stay ahead" of cyberthreats while combating a workforce shortage.
The budget proposal would increase DOE’s funding for "cyber and energy security" programs, setting aside $180 million for the Office of Cybersecurity, Energy Security and Emergency Response, which is in charge of fighting cyberthreats and natural disasters.
The proposal is an increase of around $29 million compared with last year’s proposal from the administration, and around $28 million more than CESER’s budget for fiscal 2020.
The funding would go toward "early-stage" research and development, aimed at improving cybersecurity and resilience throughout the supply chain, according to the request.
Under the plan, the Department of Homeland Security would see more than $1.1 billion for cybersecurity, led by the Cybersecurity and Infrastructure Security Agency (CISA). The proposal for CISA’s budget for fiscal 2021 is similar to last year’s proposal, cutting the total funding by over $250 million.
The proposal would also earmark funding for CISA to lead a cybersecurity workforce program for government employees, which would include a "cyber rotational program," a training program and a "cyber-reskilling academy," according to the proposed budget.
The proposed budget would additionally fund DHS’s Cyber Talent Management System and increase the number of network risk assessments from 1,800 to 6,500, which includes state and local election systems.
The administration seeks nearly $10 billion to continue developing the Department of Defense’s cyber capabilities and growing the workforce, including U.S. Cyber Command. This is in line with last year’s proposal.
Offshore wind boost?
The president’s proposal also revealed a renewable focus of the Bureau of Ocean Energy Management, an Interior agency that manages offshore energy leasing and permitting.
BOEM’s total budget proposal would be reduced to $188.8 million for fiscal 2021 from $191.6 million enacted in fiscal 2020.
The agency would nix funding to develop a new offshore oil and gas plan, confirming that the Trump administration’s push to dramatically revise the current five-year plan is "on hold."
The agency also would increase funding directed toward renewables research, planning and leasing.
BOEM noted in its budget justification that it is working on new lease areas for Hawaii, California, New York, New Jersey, North Carolina and South Carolina. Staff is also processing five construction and operations plans and anticipating several more this year.
The agency would increase its funding for its renewable program to meet "demands triggered by the Bureau’s leasing program and allow for the streamlining of its permitting and [National Environmental Policy Act] processes."
Erik Milito, president of the National Ocean Industries Association, said the proposed increase for renewables "shows a commitment to the wind industry by the Trump administration."
BOEM is the central permitting authority for offshore wind and is under pressure from an energetic offshore wind industry eager to clear permitting hurdles.
The agency last year stalled the final environmental review from what was expected to be the first commercial offshore wind farm in U.S. waters to do a cumulative impact analysis.
Oil and gas pipeline safety
Funding for pipeline safety programs would be cut, but not as deeply as the administration has proposed for some environmental programs.
The budget request for the Pipeline and Hazardous Materials Safety Administration would fall 1.8%, from $281 million in fiscal 2020 to $276 million in fiscal 2021. Spending on the agency’s pipeline safety division would be cut 2.8%, from $145 million to $141 million during the same time period.
The administration has proposed eliminating the U.S. Chemical Safety Board, an independent agency that investigates accidents at refineries, chemical plants, and oil and gas production sites, saying its work duplicates other agencies.
The safety board, though, has bipartisan support in Congress and has survived previous attempts to abolish it (Greenwire, Feb. 14, 2019).
The CSB has asked for a 12.8% funding increase, from $12 million in fiscal 2020 to $13.5 million. About $400,000 of the increase would be a one-time expenditure to implement a reporting system for accidental chemical releases (Greenwire, Feb. 6).
"If the CSB’s many safety lessons prevent at least one catastrophic incident, the costs avoided from damage to facilities and the surrounding communities, legal settlements, and the loss of human life far outweigh the agency’s annual budget," the agency said in its budget request.
Reporters Heather Richards, Christian Vasquez and Mike Lee contributed.