May 8, 2009

The federal budget has been called a moral document by Congresswoman Barbara Lee. Its spending priorities reflect these morals. The release of President Obama's full fiscal year 2010 budget begins to show us his administration's national priorities. Our job as citizens is to reconcile the President's budget numbers with his words.

At his inauguration, Barack Obama said, “...each day brings further evidence that the ways we use energy strengthen our adversaries and threaten our planet.” To the degree these values are reflected in his first federal budget, there should be qualitative and quantitative changes in his discretionary spending proposals regarding renewable and nonrenewable sources of energy.

Relative to the final Bush administration budget, funding requests for renewable energy-related research and development and for smart grid development and expansion have increased. The Department of Energy sees a 4% increase* in funding for energy efficiency and renewable energy to $2.3 billion. Funding for electricity delivery and energy reliability increases a robust 48% to $208 million. The President requests an additional $10 million to help move scientific discoveries into energy technology innovations. To support the nation's turn to renewable energy, the Department of Labor's Green Jobs Initiative receives $28 million to train workers.

While increased spending related to renewable energy is a crucial step in liberating our nation's dependence on oil, an equally critical step is reducing our spending to prop up our oil habit. About 85% of US energy consumption is in the form of fossil fuel while a mere 7% comes from renewable sources. Our need for oil is so great that we have insufficient resources to meet these needs and must import nearly 60% of the petroleum we use.

Decreased funding is a necessary incentive to wean us from fossil fuel-derived energy sources. In fact, we see a 31% decrease in President Obama's funding for the Department of Energy's fossil energy research and development, although there is a 9% increase for the Strategic Petroleum Reserve. Caution is warranted in any enabling of our petroleum habit as that may slow our motivation to shift to renewable sources of energy.

Our brief glimpse into the Obama administration's budget shows that first steps are being taken to shift the nation's energy-related values and redefine what it means to be energy secure.

After the administration releases additional budget information next Thursday, look for NPP’s analysis of the complete picture of federal spending priorities and impacts on state-level programs.

*All comparisons in text are adjusted for inflation.

Selected Energy-Related Program Funding At A Glance (in millions)

Program	FY2009	FY2010	Recovery Act
Energy Efficiency & Renewable Energy	$2,179	$2,319	$16,800
Electricity Delivery & Energy Reliability	$137	$208	$4,500
Energy Transformation Acceleration Fund (ARPA-E)		$10	$400
Green Jobs Initiative		$28	$495
Innovative Technology Loan Guarantee Program			$6,000
Fossil Fuel Research & Development	$876	$618	$3,400
Strategic Petroleum Reserve	$205	$229
Northeast Home Heating Oil Reserve	$10	$11