In the wake of President Trump's proposed budget cut to the Department of Energy (DOE), a coalition of business executives, including some representing the oil and gas industry, are urging lawmakers to maintain federal investments in energy research and development (R&D).
At issue are $3.1 billion in cuts to energy programs at the DOE, part of Trump's proposed budget for fiscal year (FY) 2018, released last month. Trump has proposed allocating $28 billion to the DOE in FY 2018, a 5.6% cut from FY2017. The department's budget includes $13.9 billion for its National Nuclear Security Administration, an increase of $1.4 billion (11.4%) from FY2017.
In a letter Wednesday to U.S. Sens. Thad Cochran (R-MS) and Patrick Leahy (D-VT) and Reps. Rodney Frelinghuysen (R-NJ) and Nita Lowey (D-NY), 14 members of the nonprofit Bipartisan Policy Center (BPC) said it was vital to the nation's economic and energy future that R&D programs at the DOE receive adequate funding.
"The successful development of new energy technologies, and the jobs they create, depends on effective partnerships between the public and private sectors," the BPC said. "The capital intensity of energy projects, long time horizons and uncertain regulatory environments make these partnerships especially critical in the energy sector.
"Such collaborations, like the development of technologies which enabled the emergence of hydraulic fracturing [fracking], have repeatedly shown their potential to enhance our energy security and create new jobs in an increasingly competitive global marketplace."
The BPC added that federal investments "at crucial stages in the innovation cycle provide essential support to private sector efforts in developing energy technologies and resources we can export to meet these needs. At the same time, such innovations also enhance the competitiveness of energy-intensive domestic industries like manufacturing and agriculture, while driving down transportation costs that affect the broader economy."
Cochran chairs the Senate Appropriations Committee and Leahy is the committee's ranking member. Meanwhile, Frelinghuysen chairs the House Appropriations Committee and Lowey serves as that panel's ranking member.
Dave McCurdy, CEO of the American Gas Association, was one of the 14 people to sign the letter, as were U.S. Chamber of Commerce CEO Thomas Donohue and Consumer Energy Alliance President David Holt. Other signatories included Exelon Corp. CEO Christopher Crane; Pioneer Natural Resources Co. CEO Timothy Dove; PG&E Corp. Executive Chairman Anthony Early Jr.; and Bruce Culpepper, president of Shell Oil Co., a division of Royal Dutch Shell plc.
The DOE budget includes a proposal to reduce the Strategic Petroleum Reserve by half, and envisions cutting $500 million in spending to support the reserve in FY 2018. The Trump administration estimated that cutting the reserve in half would save an estimated $4.4 billion over the next five fiscal years, and $16.6 billion over the next 10 years.