The Department of Energy’s world-class laboratories are poised for dramatic changes.
The Trump administration’s fiscal 2026 budget proposal would slash major programs at the labs, which have been cornerstones of U.S. research for decades, tracing back to the Manhattan Project at Los Alamos National Laboratory in New Mexico. DOE controls 17 national labs across the country.
Those proposed cuts come as Energy Secretary Chris Wright pledges a federal focus on artificial intelligence, fusion energy and other areas of potential life-changing scientific breakthroughs in the coming years and decades.
Speaking at the National Energy Technology Laboratory in Morgantown, West Virginia, on Wednesday, Wright touted the lab’s research to boost rare earth mining in the U.S. and improve industrial processes for ammonia production. He also called for a new wave of big energy infrastructure projects.
“We need to make it vastly easier to build power plants in the United States of all kinds,” Wright said at NETL. “We need new electricity to reindustrialize America, to win the race on AI, and to stop the huge upward pressure on electricity prices.”
Despite Wright’s consistent plaudits of the lab network, the Trump administration’s budget proposal takes an ax to the NETL budget, cutting $305 million — or 32 percent — from current levels. It slashes programs on hydrogen, vehicles, bioenergy, transmission, methane mitigation, carbon dioxide removal from the atmosphere, carbon utilization and point-source carbon capture research.
At a hearing this month with Wright, Senate Energy and Natural Resources ranking member Martin Heinrich (D-N.M.) said the budget would cut $2.75 billion across all labs. “Our nation’s scientific and energy leadership is on the line,” Heinrich said, adding that the cuts could cause more than 7,700 job losses.
In order to make those funding cuts a reality, Congress will need to pass them into law. While lawmakers rebuffed Trump on DOE funding reductions in his first term, House Republicans have ramped up a push for budget austerity.
The House-passed reconciliation bill moving through Congress all but repeals the Biden-era Inflation Reduction Act, and House budget hawks have warned the Senate against keeping green tax breaks.
The White House’s proposed lab cuts come as the Trump administration puts scientific research across the government in its crosshairs. Climate change studies are under fire. And the Department of Housing and Urban Development relocated to the headquarters of the National Science Foundation on Wednesday, a decision that is leaving NSF staff in limbo.
Meanwhile, the proposed budgets for the labs largely mirror President Donald Trump’s overall DOE request, with sharply reduced funding for solar, wind and electric vehicle research.
The budget request would slash funding at the National Renewable Energy Laboratory from current levels by more than 56 percent, from $687 million to $300 million. Within that, funding for wind, solar and hydrogen technology research would be zeroed out. Support for efficiency research on buildings at the lab would fall by more than 90 percent.
Combined with potential rollbacks on tax credits from Congress, the funding cuts could be a “double whammy” that is going to raise costs and slow the development of renewables, said Steve Clemmer, director of energy research at the Union of Concerned Scientists.
In May, NREL laid off 114 employees to align with Trump’s “critical priorities.” Wright has been critical of federal subsidies for wind and solar, saying they are no longer emerging technologies in need of support.
The Pacific Northwest National Laboratory also would see significant cuts, with its proposed budget falling by more than 30 percent. Hydrogen, renewable and sustainable transportation programs would be zeroed out.
Other large national labs, including Los Alamos and Lawrence Livermore laboratories, would see their overall budgets go up under the plan. And some of Wright’s priorities, including for geothermal and water power, would see increased budgets at NREL.
But in some cases, the proposal seems to be at odds with Wright’s priorities. While support for geothermal would go up at NREL, for instance, it would be zeroed out entirealy at PNNL. Wright has recently walked back the proposed budget cuts for DOE labs.
“AI is moving very fast right now. Quantum computing is about to arrive. And fusion energy, a thing I worked on in my youth, is going to come to pass,” he told Congress. “This is a time I think to lean in as much as we can on these large scientific efforts. I am keen actually to grow the budget for our national labs in those key areas.”
Fusion cuts
Despite the public support from Wright, nuclear fusion, a potential zero-carbon source of electricity that could produce much more energy than traditional nuclear fission, takes some hits in the budget.
The Fusion Energy Sciences office at DOE would be cut roughly $45 million, and fusion cuts are proposed at a set of labs, including Argonne, Brookhaven and Idaho, alongside increases at Lawrence Berkeley and Lawrence Livermore.
“As much as the secretary is talking about how excited he is about fusion, the budget they proposed cut it,” said Andrew Holland, CEO of the Fusion Industry Association. “The truth is the Chinese are not cutting, and the competitors in Germany and the U.K. are not cutting.”
In 2022, the Lawrence Livermore lab spearheaded a fusion ignition breakthrough. Holland said the Trump administration has not instituted any big changes to fusion research since taking office.
Still, he said the sector is poised for a breakthrough.
“The national labs have been doing fusion since the ’50s,” he said. “The thing that’s changed now is that, in the last five years, over $8 billion has been invested in the private sector to bring this technology to commercialization.”
Wright also is pushing for the labs to be a tool to develop nuclear fission power, including advanced reactors.
This week, Idaho National Laboratory researchers reported results from a first-of-its-kind test aimed at lowering the amount of waste produced by reactors. The lab is asking Wright to allow DOE to be the main safety regulator for advanced reactors, instead of the independent Nuclear Regulatory Commission — a move that would dramatically change how new plants are approved if implemented.
Data center build-out
Perhaps the chief way the administration is looking to shape the labs is with AI. In April, Wright unveiled a plan to potentially build data centers at 16 federal sites, including multiple national labs. At the time, Wright said DOE was considering co-locating power plants next to data centers, eyeing the start of operations at the sites by the end of 2027.
At NETL on Wednesday, Wright signaled the plan would help nuclear power.
“You will see data centers built on national lab property,” he said. “You also will see next-generation nuclear reactors tested” on federal lands sometime next year, he added.
Wright said DOE was looking to make agreements with data center developers partly to “bring some money in.” He said some of the computation power could be used by the labs, but most would be used by hyperscalers. The comments echo ones from April, when Wright said “there may be some allocation of computing power” from data centers to help the national labs.
In a statement, DOE said it received “hundreds of comments,” including from data center developers, utilities, and state and tribal governments. “We are still taking time to consider each comment carefully as we determine next steps,” the statement said. Because the plan was in the form of a request for information, it does not have the same requirements as a formal rulemaking at this point.
OpenAI, one of the key players in the “Stargate” project backed by Trump to spend $500 billion on data centers over the next five years, was among the commenters. The company called for a “streamlined permitting process” among other recommendations.
Other groups, such as the Data Center Coalition and the Information Technology Industry Council, also submitted recommendations to DOE on the plan.
One industry representative familiar with DOE’s process said the administration appears to be looking for a “combined package” from developers wanting to build on federal land that includes not just data centers but an “energy component.” That could potentially include co-located power plants, but also deals with utilities for power or transmission components.
DOE seems open to “unique arrangements,” the person said.
Wright is pushing AI in other ways, including through a new supercomputer named “Doudna” housed at the Lawrence Berkeley lab that would provide more than 10 times the power of its existing model.
“We cannot get second place,” Wright said in an interview with Breitbart News on Tuesday about the U.S. race with China to develop AI technologies.
Earlier this month, Amazon Web Services announced a partnership with Lawrence Livermore’s National Ignition Facility to develop an AI “troubleshooting” system. Amazon said the deal would enhance efficiency at the fusion-focused NIF.
Push for more geothermal funding
Meanwhile, geothermal energy is emerging as a big priority for the Trump administration.
The technology, which harnesses heat from underground to generate electricity, got a rare increase in the White House’s 2026 budget proposal. The Geothermal Technologies Office would get $32 million more than currently enacted. The proposal also reshuffles much of the geothermal research budget, leveling big cuts, for example, at the Lawrence Berkeley and Sandia labs, while increasing geothermal funds at DOE headquarters and the NREL lab.
Still, geothermal supporters are pushing for more research dollars — $135 million above the proposed budget — to support demonstration projects in the FORGE program, where labs collaborate with universities and companies like Fervo Energy to demonstrate technologies.
Bryant Jones, executive director of the trade association Geothermal Rising, said the research funds and demonstrations would help prove geothermal systems in new geologies, outside traditional geothermal production areas in the western U.S.
“It’ll help de-risk other regions of the United States, where a geothermal developer might be hesitant to start a project,” Jones said. “Geothermal doesn’t have a technology problem; it has a policy problem.”
Some permitting reforms are also on the agenda at DOE labs.
In March, the department raised the monetary threshold for department oversight over lab projects, a move praised by lab directors. Top Democrats on Capitol Hill argued in a letter to the Government Accountability Office that the deregulation measure risks cost overruns for projects and poses ethical issues.
Some leaders in the private sector say DOE labs need to prioritize commercialization of new energy technologies.
“The labs, frankly, just need to have more performance accountability by headquarters on helping and incenting the labs to work more in partnership with industry,” said Robert Atkinson, president of the Information Technology and Innovation Foundation. “We need at least a couple more labs focused more on commercial technology development, but in a budget-cutting environment that’s hard to do.”
The 2021 bipartisan infrastructure law supercharged DOE from an early seed money financier to a full-scale commercialization enterprise, but the budget reconciliation legislation on Capitol Hill reins in much of that funding.
Atkinson said the Trump administration has “some good instincts” but bemoaned the “bulldozer” approach to federal funding cuts.
