Bush Clean Energy Goals Must Be Matched by New Funding and Policy Action

Washington, D.C. — The American Council for an Energy-Efficient Economy (ACEEE)'s review of the President's State of the Union address applauded the Administration's recognition of our oil-dependence problem and the need for new clean energy research. However, ACEEE also observed that while the speech contained promising words on new clean energy policy initiatives, it contrasts sharply with the administration's funding record on energy efficiency technology and its policy inaction on clean energy solutions.

"The President's call for reduced oil dependence and new energy technologies is laudable, but to be credible, the Administration must reverse its record of cutting overall funding for energy efficiency and other clean energy technologies," said ACEEE Executive Director Steven Nadel. "Next week's budget must show major increases in total funding for clean energy, not just more of the program reshufflings we've seen for the last five years."

Two of the leading examples of the administration's shrinking commitment to energy efficiency are:

• A 14% inflation-adjusted decline in energy efficiency RD&D funding since FY 2002. This funding decline includes the president's Freedom Car hydrogen vehicle program. What this means is that the Freedom Car and other administration priorities are being funded at the expense of other clean energy programs. So while the administration talks glowingly about these priority initiatives, the overall funding picture for equally important technologies has remained negative.
• A $3 billion, 60% drop in clean energy tax incentives in the final Energy Policy Act of 2005. While the Senate bill would have spent $5.5 billion on efficiency and other clean energy technology incentives, the White House insisted during conference that these tax incentives be cut. The final bill spends $2.1 billion, largely due to administration pressure. This loss of funding will require the building of the equivalent of 27 additional 300-Megawatt power plants by 2020.

The President also talked about developing alternative motor fuels to combat America's addiction to oil. While alternative fuels are an important element of our energy future, the President is ignoring near-term solutions—especially vehicle fuel efficiency—that can give consumers relief at the pump while building a bridge to hydrogen and biofuels. The President could, for example, issue a strong new fuel economy standard this spring for SUVs, pickups, and other light trucks, which would cut consumer fuel bills while buying time for his longer-term solutions. Congress passed 16 new appliance efficiency standards in 2005, which will begin saving energy in the next few years; the Administration should follow suit by issuing strong new fuel economy standards for light trucks.

"Energy efficiency is the cornerstone of any clean energy future. Without it, we won't be able to grow enough biofuels, or build enough solar, wind, or coal gasification to keep up with the runaway demand," said ACEEE Deputy Director Bill Prindle. "The administration needs a more balanced energy research and policy portfolio, with more funding and real policy action on efficiency while it is still in office, so that its vision of a clean energy future will have a chance."

ACEEE's fact sheet on the benefits of energy efficiency research and development programs can be downloaded at http://www.aceee.org/energy/rdd.pdf. Our comparison of the impacts of the Senate, House, and Conference versions of the Energy Policy Act of 2005 can be downloaded at http://www.aceee.org/energy/0508legsvg.pdf.