Monday April 9 11:46 AM ET
Bush Budget Slashes Solar, Renewable Energy Programs

By Tom Doggett

WASHINGTON (Reuters) - President Bush on Monday proposed slashing more than $200 million from federal renewable energy and efficiency research programs, even as his administration claims the United States must find ways to cope with an energy crisis.

Under the president's proposed fiscal 2002 budget, the Energy Department's core solar and renewable energy programs would be cut in half to $186 million from current spending levels of $376 million.

The department's efficiency research programs, which seek ways to reduce energy use, would be cut by $61 million to $795 million in the 2002 spending year that begins on Oct. 1.

Bush's budget also assumes the federal government will raise $1.2 billion in bonus bids for oil and natural gas leases in Alaska's Arctic National Wildlife Refuge in 2004.

The White House proposes to spend that money on alternative energy programs over seven years. However, there is growing opposition in Congress to allow drilling in the Arctic refuge for environmental reasons, so the money may never materialize.

The president's budget does propose spending $150 million to develop less-polluting coal for fuelling electric generating plants, and revives spending for nuclear power.

Vice President Dick Cheney said on Sunday a special White House energy task force is considering increased use of nuclear power, and he personally believes the United States needs to build more nuclear power plants. No utility has been issued a federal license to build a nuclear plant in two decades.

Renewable energy groups said the cuts will undermine efforts to boost energy supplies in the western part of the United States, which has been hit with high electricity costs and rolling blackouts in California.

``If not reversed by Congress, DOE's proposed cutbacks will seriously damage efforts to bring new clean energy supplies on-line to help solve the West's energy crisis,'' they said.

The Alliance to Save Energy said the programs under the administration's budget ax save consumers more than $25 billion each year, lessen oil imports and prevent tons of pollution.

``Faced with sky-high heating bills, increased gasoline prices, and new prospects for electricity shortages, the nation needs to invest more heavily in energy efficiency, which remains the cheapest, quickest and cleanest way to lessen energy problems and extend energy supplies,'' said Alliance president David Nemtzow.

To boost U.S. electricity supplies, Bush's budget proposes expanding a tax credit for producing electricity from wind and other certain sources, and applying it to more power plants.

The current 1.5-cent tax credit for each kilowatt-hour of electricity produced from wind, organic biomass material and poultry waste would be extended for three more years to power
plants built through 2004.

In addition, eligible biomass would be expanded to include forest-related and agricultural sources.

Bush also wants to increase funding for the federal weatherization program, which helps to make homes more energy-efficient.

Congress will spend the next few months finalizing a spending plan for the federal government for fiscal 2002.

-----