Creating the Clean Energy of Tomorrow and Protecting the Environment and Natural Resources

The Federal Budget

Having emerged from the worst recession in generations, the President has put forward a plan to rebuild our economy and win the future by out-innovating, out-educating, and out-building our global competitors and creating the jobs and industries of tomorrow. But we cannot rebuild our economy and win the future if we pass on a mountain of debt to our children and grandchildren. We must restore fiscal responsibility, and reform our government to make it more effective, efficient, and open to the American people. The President’s 2012 Budget is a responsible approach that puts the nation on a path to live within our means so we can invest in our future – by cutting wasteful spending and making tough choices on some things we cannot afford, while keeping the investments we need to grow the economy and create jobs. It targets scarce federal resources to the areas critical to winning the future: education, innovation, clean energy, and infrastructure. And it proposes to reform how Washington does business, putting more federal funding up for competition, cutting waste, and reorganizing government so that it better serves the American people.

To protect the environment for generations to come, the Budget will:

Support American Leadership in Clean Energy. The President is committed to building a new clean energy economy here at home – because the nation that harnesses the power of clean, renewable energy will be the nation that leads the 21st century. A clean energy economy supports job growth, environmental protection, and fiscal health. The centerpiece of the Administration’s clean energy strategy is to double the share of electricity from clean energy sources by 2035 to 80 percent through a Clean Energy Standard. Budget investments support this plan by more than doubling energy efficiency research, development, and deployment; increasing renewable energy investments by over 70 percent; investing in research and licensing support for small modular nuclear reactors; and advancing clean coal technology—particularly carbon capture and storage. The Budget provides $36 billion in additional loan authority for nuclear power plants as well as up to $2 billion in loan guarantees for renewable and energy efficiency projects. The Budget also includes an additional $5 billion for 48C tax credits for energy manufacturing – which would incentivize more than $11 billion in private sector investment—and an extension of the 1603 cash grant in lieu of investment tax credits, two programs that have supported clean energy investment and created jobs since they were introduced in the Recovery Act. As part of the President’s clean energy agenda, the Budget proposes:

Put One Million Electric Vehicles on the Road by 2015. In 2008, the President set an ambitious goal of having 1 million electric vehicles on the road by 2015. To reach that goal and become the first in the world to do so, the Budget proposes a new effort to support electric vehicle manufacturing and adoption in the U.S. through new consumer tax rebates, investments in research and development (R&D), and competitive programs to encourage communities that invest in electric vehicle infrastructure. Specifically, the Budget proposes to: transform the existing $7,500 tax credit for electric vehicles into a rebate that will be available to all consumers immediately at the point of sale; advance innovative technologies through new R&D investments, building on Recovery Act investments for technologies like batteries and electric drives – including an over 89 percent increase in support for vehicle technology R&D and a new Energy Innovation Hub devoted to improving batteries and energy storage for vehicles and beyond; incentivize communities to invest in electric vehicle (EV) infrastructure through a $200 million program, modeled after Race-to-the-top, which provides an incentive for communities to invest in EV’s, infrastructure and remove regulatory barriers.

Bring the Best Minds Together to Advance Critical Energy Research. Innovation and breakthroughs often happen when scientists and thinkers from different disciplines collaborate on some of our toughest problems. That is why we are challenging America’s scientists and engineers to assemble teams of the best minds in their fields to focus on the hardest problems in clean energy. The best proposals will be funded as new Energy Innovation Hubs. Currently, we have three Hubs in place, which specialize in fuels from sunlight, energy efficient buildings, and modeling and simulation technologies for nuclear power. The Budget doubles the number of Energy Innovation Hubs, creating three more hubs across the country. These new Hubs will bring together top scientists to work in teams on cross-disciplinary research related to: critical materials, including rare earth elements; batteries and energy storage; and the development of new SmartGrid technologies and systems to improve energy transmission efficiency. The budget also invests $650 million in the Advanced Research Projects Agency-Energy (ARPA-E), including $100 million under the Wireless Innovation and Infrastructure Initiative. This will allow ARPA-E to continue the promising early-stage research projects that aimed to deliver game-changing clean energy technologies by providing enough funds to more than double the portfolio of projects funded through this important program.

Commit to Efficiency through a “Better Buildings Initiative”. Last year, commercial buildings consumed roughly 20 percent of all energy in the U.S. economy. Improving energy efficiency in our buildings can create jobs, save money, reduce our dependence on oil, and make our air cleaner. The President’s Better Buildings Initiative will make commercial buildings 20 percent more energy efficient over the next decade through initiatives that include: re-designing the current tax deduction for commercial buildings and upgrades to a credit that is more generous; improving financing opportunities for retrofits through the Small Business Administration’s loan program as well as a new pilot program through the Department of Energy to guarantee loans for upgrades to hospitals, schools, and other commercial buildings; creating a $100 million “Race to Green” competition for state and municipal governments to implement innovative approaches to building codes, performance standards, and regulations so that commercial building efficiency will become the norm; and increasing R&D funding for buildings technologies.. The Better Buildings Initiative builds on our investments through the Recovery Act and our continued commitment to passing “HOMESTAR” legislation to encourage American families to make energy saving upgrades in their homes.

Open Federal Lands to Clean Energy Generation. The vast acreage of Federal land holdings presents an opportunity for the Nation to facilitate large-scale clean energy projects. The Budget includes $43 million to review and permit new renewable energy projects on Federal lands, with the goal of permitting at least 9,000 megawatts of new solar, wind, and geothermal electricity generation capacity on Department of the Interior-managed lands by the end of calendar year 2011.

Improve Fuel Economy Standards and Reduce Greenhouse Gas Emissions. The Environmental Protection Agency (EPA) will continue to seek cost-effective greenhouse gas (GHG) emissions reductions strategies that protect the health and welfare of Americans. Beginning with model year 2012, EPA will begin to implement a historic national program to reduce GHGs and improve fuel economy standards for cars and trucks, projected to save 1.8 billion barrels of oil and reduce U.S. GHG emissions by 960 million metric tons over the lifetime of vehicles sold during 2012-2016. The Administration proposes $25 million for State grants to implement permitting programs tailored to GHG emissions. Additionally, EPA will continue to develop regulatory strategies to control GHG emissions from major stationary sources. The Administration also maintains funding levels for partnership and voluntary programs like Energy Star, which help conserve energy and bring down utility bills for American families and businesses.

Protect the Environment and Public Health. Funding for EPA’s core activities, such as enforcement of environment and public health protections, is maintained at the FY 2010 level. The Budget requests $9 billion for the Environmental Protection Agency overall, -$1.3 billion (-12.7 percent) below the FY 2010 enacted level; however, most of the reduction (-$947 million) of the overall EPA funding is a planned reduction of the State Revolving Funds for drinking water and wastewater infrastructure projects. The Administration is committed to protecting the health of all Americans by ensuring clean air and water. EPA will provide $1.2 billion to States and Tribes to implement their environmental programs—an increase of $85 million. Additionally, air quality in America’s communities will be improved by updating and implementing risk-based standards for air toxics. An additional $3.7 million will help EPA ensure their programs, policies, and regulations address environmental health impacts for all Americans, particularly children.

Promote Economic Growth with Funding for Brownfields Technical Assistance and Projects Grants. Brownfields are lightly contaminated sites–many in economically hard-hit areas–where the presence or potential presence of contamination may keep these sites from being used productively. The President's Budget provides the Brownfields program with funding for technical assistance to local communities and grants for sustainable development.

Conserve Landscapes and Ecosystems and Promote Outdoor Recreation. The Administration maintains support for land management operations in the Department of the Interior, and fully funds at $900 million the Land and Water Conservation Fund (LWCF) programs in the Departments of the Interior (DOI) and Agriculture. The 2012 Budget leverages and integrates efforts of the Fish and Wildlife Service, the National Park Service, the Bureau of Land Management, and the U.S. Forest Service, along with States, Tribes and other partners to conserve our most critical landscapes. This includes $200 million for State LWCF grants, some of which will be competitively awarded to address priorities and leverage resources for urban parks and public-private conservation projects. The Administration also proposes funding for key grant and partnership programs, such as the Challenge Cost Share and historic preservation programs, and reauthorizes DOI’s authority under the Federal Land Transaction Facilitation Act to use proceeds from the sale of low-conservation value lands to acquire additional high-priority conservation lands.

Improve Efficiency of Conservation Efforts. The Administration supports a robust conservation agenda by strategically targeting funding to high-priority regional ecosystems and initiatives. Included in the proposal are the highest funding levels ever for the Wetlands Reserve Program and the Environmental Quality Incentives Program, which will allow for the restoration and protection of nearly 271,158 additional acres of wetlands and provide over $1.4 billion for conservation assistance, respectively. The Administration also fully funds the Conservation Reserve Program, maintaining the program’s enrollment at 32 million acres. The Administration supports a broad partnership among Federal agencies, State and local governments, Tribes, industry and agriculture to advance water policy goals. This outreach and cooperation incorporates stakeholder input and better targets resources, reduces barriers to effective action and eliminates redundancies. For example, the Administration provides funding across a range of conservation programs to support the installation of high-impact targeted conservation practices designed to improve water quality on 6 million acres within regional ecosystems such as the Chesapeake Bay, the Bay-Delta region in California, and the Upper Mississippi River Basin.

Restore the Gulf Coast Ecosystem. The Administration has been consistently committed to addressing the challenges of protecting and restoring the Gulf Coast ecosystem – challenges that were exacerbated by the tragedy of the Deepwater Horizon oil spill. Work has already begun with the Gulf States through the Natural Resource Damage Assessment and Restoration process to restore the area's natural resources to pre-spill conditions. If approved by Congress, a portion of civil penalties obtained from parties responsible for the oil spill will be dedicated to the Gulf Coast restoration, an important resource for funding additional critical ecosystem activities, and a key component of the Administration's response to the environmental, economic, and health needs of the region. The President established, by Executive Order, a Gulf Coast Ecosystem Restoration Task Force chaired by the EPA Administrator that will lead environmental recovery efforts by Federal and state members in the region.

Support Restoration of the Chesapeake Bay. Funding for EPA Chesapeake Bay restoration is increased by $17 million (35 percent) to $67 million to support Bay watershed States as they implement their plans to reduce nutrient and sediment pollution in an unprecedented effort to restore this economically important ecosystem. EPA and Federal partners will continue to coordinate with States, Tribes, municipalities, and industry to restore the integrity of imperiled waters of the United States.

Consolidate Forest Restoration Programs. To maximize the Forest Service’s ability to address changing needs and manage diverse forest landscapes, the Administration supports a holistic approach to restoration and maintenance of sustainable landscapes. By merging multiple programs, the Forest Service can increase its ability to restore forest resiliency and health while supporting sustainable economic development. This streamlined approach will also improve forest management efficiency.

Implement the National Ocean Policy. The National Ocean Policy provides a comprehensive approach, based on science and technology, to uphold our stewardship responsibilities for marine ecosystems. The goals for 2012 are to implement strategic action plans, develop a national information management system, and support regionally-based coastal and marine spatial planning. The Budget provides the National Oceanic and Atmospheric Administration (NOAA) $20 million in grants to advance regional ocean management through support for regional ocean partnerships, while NOAA and DOI receive a combined $12 million for data integration and management. Additional funding is also proposed for fisheries stock assessments and oil spill research and response. Priority activities also include understanding changing conditions in the Arctic; improving observations, mapping, and infrastructure; and increasing resiliency and adaptation of coastal communities and marine ecosystems to climate change and ocean acidification.