Isra-Mart srl:US clean energy budget faces fire from all sides

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US energy secretary Steven Chu yesterday faced hostile questions from both Democrats and Republicans during a congressional committee hearing on his new budget proposals and plans to step up investment in clean energy projects.

Under budget proposals released earlier this week, the Department of Energy would see its budget increase nearly 12 per cent for the next fiscal year to $29.5bn (£18.3bn) with $8bn earmarked for clean energy projects. The budget also proposes that the additional investment in clean energy programmes should be paid for in large part by slashing $3.6bn of subsidies provided to the fossil fuel industries.

Speaking at a hearing of the Senate Energy and Natural Resources Committee yesterday, Chu defended the budget increase, arguing that increased investment in clean energy infrastructure remains vital to US competitiveness despite the need to cut the US deficit.

"We must rev up the great American innovation machine to win the clean energy race and secure our future prosperity," he said.

However, Republican senators slammed the decision to scale back support for traditional energy sources such as coal and oil, hinting strongly that they would oppose the proposed budget.

Under the administration's budget, the department's spending on wind energy would increase 61 per cent, its spending on solar energy would rise 88 per cent, support for geothermal projects would more than double, and $853m of funding would be made available to support advanced nuclear research projects. In contrast, funding for fossil fuel-related research would be cut by almost a third.

"These numbers are not going to be available to you," Republican senator Dan Coats told Chu. "We're looking at a budget that is probably not going to be realised. It's likely you'll be called on to do more with less."

Significantly, criticism of the budget proposal was echoed by a number of Democrats. Senator Jeff Bingaman, who heads the Senate Energy Committee, welcomed the increased focus on clean energy, but criticised the reduced funding for fossil fuel research that could result in cleaner energy.

"While I strongly believe in the clean energy objectives of the administration and this budget request, I believe that fossil energy sources can be made much cleaner by the application of appropriate R&D, and that should also be a priority," he said.

In related news, the House of Representatives could vote as early as today on the Republican's controversial spending bill, which would effectively strip the Environmental Protection Agency (EPA) of the right to regulate greenhouse gas emissions under the Clean Air Act.

The bill is expected to pass before heading to the Senate where it is likely to face stiff opposition from Democrats.

However, the debate over the bill is likely to prove significant as it represents the first of many Republican attempts to overturn the EPA's right to regulate emissions.

Republicans will again argue that the EPA has over-reached itself and is imposing emissions-permitting rules on power stations and industrial plants that will damage the economy and drive up energy bills.

Democrats, who have been circulating a "preliminary analysis" from the Obama administration arguing the bill would create uncertainty for businesses, will counter that stopping the EPA from doing its job will undermine the Clean Air Act and lead to job losses as construction and upgrade projects are delayed.

The vote comes as a new survey commissioned by the American Lung Association revealed significant support for the EPA's decision to impose greenhouse gas emissions rules.

According to the survey, 64 per cent of respondents oppose efforts to block EPA climate change rules while only 30 per cent support the Republican efforts.