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February 5, 2007
Note: Highlighted and Red text of special interest to AAPG members.

DOE Budget Scores Overall Increase, Yet Important Gaps in Energy Policy Remain

Sen. Jeff Bingaman (D-NM) welcomed increases in a number of Department of Energy (DOE) programs in the President’s Budget Request for FY 2008 today, while questioning other omissions that diminished the contribution of the overall budget to comprehensive U.S. energy security.

Bingaman is Chairman of the U.S. Senate Committee on Energy and Natural Resources, which has principal responsibility for the DOE. Bingaman has asked the Secretary of Energy, Samuel W. Bodman, to testify on DOE’s budget before the Committee this Wednesday at 9:30 a.m. in Room 366 of the Dirksen Senate Office Building. This will be the DOE’s first budget hearing before Congress this year.

“Some elements of DOE’s new budget request, such as increases for biomass and biofuels R&D, are positive, and I am pleased to see them. Others appear to reflect the wrong priorities, if we are to build an effective energy future,” Bingaman said. “We need to have a comprehensive approach to our energy challenges, using all of the Department’s technology strengths. I am also concerned that some of the President’s budget choices appear to short-change my home State of New Mexico.”

The President’s budget request would increase total DOE spending by 3 percent over the level requested for FY 2007, to a total of $24.3 billion. Of this total, $9.4 billion would be budgeted to the nuclear weapons missions of the Department, another $9.4 billion would be devoted to environmental cleanup and radioactive waste management, $4.4 billion would go to basic science, and $3.1 billion would go to energy supply and energy efficiency programs.

While the $3.1 billion proposed for energy activities is a major overall increase in this budget category, Bingaman took issue with some specific gaps in the new budget proposal. A fuller analysis comparing the new budget request with the authorized funding levels in the Energy Policy Act of 2005 is being prepared by staff of the Committee on Energy and Natural Resources.

The Administration’s proposal zeroes out all research and development (R&D) relating to oil and gas, and proposes to repeal $50 million in guaranteed funding outside the regular budget for onshore natural gas exploration. This leaves coal as the only fossil fuel on which DOE now proposes to carry out any research. “Even though the price of oil and gas are near record highs, we won't be able tap new domestic oil and gas resources without additional R&D. The key players for natural gas onshore in the United States are independent producers, they don't have R&D departments, and they are too small to be able to afford to start ones, regardless of the price of oil and gas. If the government abandons the field of oil and gas research, where is the new technology going to come from to keep domestic natural gas flowing in an economic and environmentally responsible manner? This is a wrongheaded decision that I hope the Congress reverses.” Bingaman said.

Bingaman questioned the substantial increases proposed for filling the Strategic Petroleum Reserve to 1.5 billion barrels. “I am a strong supporter of the Strategic Petroleum Reserve, but the Administration has never given us a clear idea of what, short of a total calamity like Hurricane Katrina, it would take to put it to use. Also, the same budget undercuts domestic production of oil and gas by terminating the R&D programs that support our other strategic petroleum reserve – the onshore oil and gas formations that we will have to continue to produce. It does not look like there is a consistent policy here.”

The new Administration budget also fails to fund any R&D on geothermal energy -- a significant potential domestic resource for clean electricity production. “A recent study by the Massachusetts Institute of Technology has highlighted how new drilling technology could revitalize our approach to geothermal energy,” Bingaman said. “I don’t know why the Administration is ignoring this promising option.”

Bingaman expressed disappointment that Solid State Lighting R&D was funded at the same level as last year’s request - $19 million - when lighting accounts for some 20 percent of electricity used in the United States and advanced lighting is seen worldwide as a key technology for the future. “If we don’t get the U.S. program for solid-state lighting jump-started, we will forfeit a potential $12 billion annual market to our economic competitors.”

The Chairman also expressed puzzlement at the enormous increases proposed for reprocessing of nuclear fuel in the new budget. “There has been very little examination of the Administration’s Global Nuclear Energy Partnership program here in Congress, yet it is proposed for a one-year increase that is larger than the whole of DOE’s solar energy R&D budget. With that increase, we would be spending more to investigate reprocessing than the entire amount we are spending on energy efficiency in buildings, transportation and industrial processes. We will need to see if there is a rationale for diverting so much money towards a program whose details are poorly understood.”

Finally, the new DOE budget proposes to cut DOE's support of weatherization activities carried out at the state and local level from $316.9 million to $204.9 million, a decrease of 35 percent. The weatherization program helps working families better insulate their homes to reduce heating and cooling bills. “The hardship caused by high heating and cooling costs can be lessened by a strong weatherization program aimed at cutting their energy losses," Bingaman explained. "It makes little sense to be cutting this program now and especially for parts of the country, like New Mexico, that are experiencing a harsh winter this year. The energy bill signed by the President in 2005 called for the increased funding of weatherization, and I will urge that we stick to the consensus position we forged in the Energy Policy Act of 2005.”

Chairman Jeff Bingaman

Senate Energy and Natural Resources Press Release – February 5, 2007

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