Sen. Jeff Bingaman (D-NM), chairman of the Senate Energy and Natural Resources Committee, last Monday blasted provisions in the Bush administration's $25 billion budget request for the Department of Energy (DOE) in fiscal year (FY) 2009, which eliminate the oil and natural gas research and development (R&D) program, the weatherization program and cut funding for solar energy research. The DOE also proposes to repeal $50 million in guaranteed funding outside the regular budget for onshore natural gas exploration.

"This leaves coal as the only fossil fuel on which DOE now proposes to carry out any research. The administration has a real blind spot when it comes to developing new domestic natural gas resources. The gas that is most available to the consumers who need it is located onshore, and the key players in developing it are independent oil and gas producers," who can't afford to fund R&D, Bingaman said.

"If DOE walks away from the R&D needed to keep natural gas flowing in an economic and environmentally responsible manner, then consumers will pay through higher prices and working families will pay through loss of manufacturing jobs that depend on natural gas."

Bingaman urged Congress to reverse this "short-sighted decision." The DOE noted that its budget request for coal R&D for FY 2009 is the largest in more than 25 years, providing for a nearly $1 billion investment in clean coal technology.

Even though the Bush administration has neglected oil and gas R&D in its budget, Congress can -- and has in the past -- restored funding for it, said Bingaman spokesman Bill Wicker. In FY 2007, Congress restored $24.75 million for R&D, and followed up with $50 million in FY 2008, he noted.

Bingaman further questioned the Bush administration's proposed funding cuts for solar energy research, hydropower and industrial energy efficiency. "If American energy-intensive industries, and the jobs they provide, are to prosper in a future in which we impose a cost on carbon dioxide, we need to act aggressively now to position them as global leaders in energy efficiency of all kinds. It's a bad time to be rolling back this societal investment in our future high-wage jobs."

He backed the administration's requested increase in funding for geothermal energy. "Here is one area in which Congress's action to reposition the DOE geothermal program, in the Energy Independence and Security Act of 2007, has paid off. I'm pleased that the program is being supported with a 50% increase," Bingaman said.

But the request to eliminate funding for DOE's weatherization program, which currently is funded at $220 million, drew another objection from Bingaman. "It's hard to fathom why this program is being terminated by the DOE now -- a lot of households need help reducing their energy bills, and the work of insulating their homes creates residential construction jobs that are greatly needed right now" as well, he noted.

At a hearing before the Senate energy committee last Wednesday, Energy Secretary Samuel Bodman said that "when we looked at the effectiveness and the financial returns" for the weatherization program, "they did not match up with the costs." He estimated the returns of the program were 5-10%. "Weatherization does not, in my judgment, stack up with the other things that they [DOE's Energy Efficiency and Renewable Energy Office] do, and that is why it was zeroed out."

Besides Bingaman, several other senators on the committee objected to elimination of the weatherization program in the FY 2009 budget, as well as cuts in funding for energy efficiency and renewable programs.

Sen. Robert Menendez (D-NJ) took Bodman to task for the Bush administration's decisions to wipe out the weatherization program, cut funding for the Low-Income Home Energy Assistance Program (LIHEAP) by 22% in FY 2009 and propose a $9 million reduction for solar energy. Although LIHEAP is administered by the Health and Human Services Department, not DOE, Bodman took the heat.

"In my mind, you leave people in the cold," Menendez said. The Bush administration requested $2 billion for LIHEAP in FY 2009, $600 million less than what was allocated in FY 2008. The American Gas Association called on Congress to include additional LIHEAP funding in the economic stimulus package, but it did not make the final measure that was approved last Thursday (see related story).

<>Sen. Bernard Sanders (D-VT) called the entire Bush administration budget for FY 2009, which emphasizes foreign initiatives over domestic programs, an "absurd document," and said "it's going to be completely rewritten" in Congress. Funding for weatherization hopefully, he said, would be restored. But Bush Friday vowed to veto any congressional appropriations bill that exceeds his budget request.

In other budget news last week, the Federal Energy Regulatory Commission submitted a FY 2009 budget request of $273.4 million in total funding and 1,465 full-time equivalent (FTE) employees, an increase of $13 million from FY 2008 and a hike of 65 FTEs. "This year's budget request reflects the growing importance of FERC's enforcement and reliability missions," said Chairman Joseph Kelliher. The bulk of the agency's budget will be earmarked for FERC's energy infrastructure program.

The Commodity Futures Trading Commission (CFTC), which has been under pressure from Congress to increase its oversight of energy trading markets, has been budgeted $130 million for FY 2009, up from $112.05 million in FY 2008. "The $130 million request recognizes the continued need for increased funding for the CFTC in light of unprecedented growth in the futures markets," said Acting CFTC Chairman Walter Lukken.

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