Energy Department

The President's budget for the Department of Energy would reduce spending from $19.67 billion in FY 2001 to $19.21 billion in FY 2002. Civilian programs at the Department would be reduced from $6.15 billion to $5.86 billion. Defense activities at the Department would be reduced from $13.52 billion to $13.36 billion.

Especially hard hit will be energy research and development programs for renewable energy (-25.9%), conservation (other than weatherization grants) (-27.2%), and fossil fuels (-17.1%). In the defense activities, programs to restore the environment at nuclear weapons and nuclear research sites (-$417.2 million or -8.4%). The Energy Information Administration (EIA) gets no increase, and would have to fund salary increases with program reductions.

One of the areas getting an increase at the Department of Energy is the Departmental Administration account (+11.8%). Among the increases is a 17.7% increase in the public affairs office and a 9.8% increase in the Congressional and Intergovernmental Affairs office.

[Note: All page references are to U.S. Department of Energy, Budget Highlights, Fiscal Year 2002 Budget Request, April 2001]

FY 2001	FY 2002 Request	FY 2002 vs. FY 2001
373.2	237.5	-135.7	-36.4%
373.2	276.7*	-96.5*	-25.9%*

Renewable energy programs would be cut by 36.4% over current spending under the request. Geothermal and hydrogen research would be cut by 48.3%. Hydropower would be cut by 49.9%. Solar energy research would be cut by 53.7%. Wind energy programs would be cut by 48.2%.

*In a last minute change, the renewable resource request will be increased by an additional $39.2 million (to come from an offsetting conservation program cut, see below). The increase has been reported to go to hydrogen programs, although the budget does not specify. Thus, actual request would be $276.7 million, a decrease of $96.5 million or a cut of 25.9%. (p. 14)

FY 2001	FY 2002 Request	FY 2002 vs. FY 2001
662.8	522.0	-140.8	-21.2%
662.8	482.8*	-180.0*	-27.2%*

The President's budget would reduce energy conservation programs (other than weatherization grants) by 21.2% in FY 2002. The Federal Energy Management Program, designed to reduce the energy use and costs of the Federal Government would be slashed by $12.4 million or 48.2%, despite efforts to reduce Federal energy consumption on the West Coast, which has been hit by electricity blackouts. Building conservation R&D would be cut by $48.4 million or 46.3%. Industry sector programs would be cut from $148.6 million to $87.7 million. The one significant increase in conservation spending is a program of grants to states to help weatherize homes, an increase from $152.7 million to $273 million.

*In a last minute change, the cut would actually be greater because a footnote to the budget table states that an additional $39.2 million will be cut from energy conservation. This means the actual conservation budget (other than weatherization) is $482.8 million, or a 27.2% reduction. The most likely source of the cuts will be the Partnership for a New Generation of Vehicles, which is a program to develop fuel efficient and environmentally clean vehicles. The budget for that program, currently at $255.4 million could drop to $200.2 million. (p. 104)

The President's request is a 17.1% reduction in research and development on fossil fuels, including coal, oil, and gas. The program cuts are actually much larger, since the budget for fossil fuels includes a new Clean Coal Power Initiative of $150 million. Thus, other fossil fuel programs are reduced by $242 million, or 44.7 %. Among the programs being cut are the central systems program from $199.1 million to $61.0 million, a 69.4% cut, although much work will be transferred to the new initiative. The natural gas program will be reduced from $45.0 million to $21.0 million, a 53.4% cut. The petroleum program will be reduced from $66.9 million to $30.5 million, a 54.4% cut. (p.96)

FY 2001	FY 2002 Request	FY 2002 vs. FY 2001
4,965.9	4,548.7	-417.2	-8.4%

The largest dollar reductions would take place in the program for Defense Environmental Restoration and Waste Management, a program to clean up the legacy of environmental hazards from the Department's nuclear weapons production and nuclear-related research. (p.67)

Funding cuts for various operations offices are as follows: (pp. 123-125 of the Detailed Request, Volume 5)

Office	FY 2001	FY 2002 Req.	FY 2002 vs. FY 2001
Albuquerque, NM	151.1	115.2	-35.8	-23.7%
Carlsbad, NM	190.9	164.6	-26.3	-13.8%
Idaho	402.6	335.3	-67.2	-16.7%
Nevada	87.2	82.8	-4.4	-5.0%
Oakland, CA	49.5	35.3	-14.2	-28.7%
Oak Ridge, TN	277.4	244.1	-33.3	-12.0%
Richland, WA	698.3	584.2	-33.3	-12.0%
Savannah River, SC	1,133.5	977.4	-156.1	-13.3%

Despite severe cuts to most energy research and development programs, and an overall reduction in the Department of Energy budget, the Departmental Administration budget increases by 11.8%. In general most of the increase is caused by the use of prior year balances and miscellaneous revenues. Management and administration decrease by 14%. However, two offices get substantial increases. The Public Affairs office is increased by 17.7% and the Congressional and Intergovernmental Affairs Office is increased by 1.7%. (p. 35)

With energy problems a priority to the Administration, the nation's independent gatherer of energy data would not even receive an inflationary increase. According to the budget, activities will have to be "discontinued or reduced" to fund nondiscretionary increases in personnel salaries and overhead. (p. 111)