Nuclear energy and energy research are among the big winners in the proposed $28.4 billion Energy Department fiscal 2011 budget the White House unveiled today.

The almost 5 percent increase in funding from fiscal 2010 covers a $36 billion boost in loan guarantee authority for nuclear power facilities for a total of $54 billion, $300 million for an innovative energy research program, and a $226 million increase in funding for the Office of Science for research and development of "breakthrough" technologies for a total of $5.1 billion.

The White House proposed the additional funds to DOE even as Obama has called for a freeze on non-military spending at 2010 levels.

Obama said his budget request would "build on the largest investment in clean energy in history, as well as increase investment in scientific research."

In keeping with his theme that the United States is at risk of falling behind the rest of the world in clean energy, Obama said those programs will produce the "jobs of the future" in the United States.

"We also continue to lay a new foundation for lasting growth, which is essential, as well," Obama said today at the White House. "Just as it would be a terrible mistake to borrow against our children's future to pay our way today, it would be equally wrong to neglect their future by failing to invest in areas that will determine our economic success in this new century."

DOE projects did not go unscathed in the administration's new battle to slow the deficit spending. The administration proposed to cancel the $20 million renovation of the Los Alamos Neutron Science Center, a linear accelerator built 30 years ago. The Obama administration says it no longer plays a critical role in weapons research.

"We're saving $20 million by stopping the refurbishment of a Department of Energy science center that the Department of Energy does not want to refurbish," Obama said.

Local lawmakers might disagree with the proposal, however, and Senate Energy and Natural Resources Chairman Jeff Bingaman (D-N.M.) has significant influence over DOE's budget.

As promised, the White House's proposed budget also eliminates funding for development of the nuclear waste repository at Yucca Mountain, Nev.; moves all administration to the Office of Nuclear Energy; and "will discontinue" its repository license application at the Nuclear Regulatory Commission. The budget includes $98 million to fund various state and local agencies associated with the project, to wind down the project and to provide $5 million for a "blue ribbon" commission to find an alternative solution to Yucca Mountain.

Energy research

The administration would continue its push to advance clean energy research and development by pouring $300 million into the Advanced Research Projects Agency-Energy, or ARPA-E, an innovative program designed to develop transformational energy technologies.

The program got its official start with a $15 million appropriation in fiscal 2009 and a $400 million boost from the stimulus. But Congress appropriated no funds for the high-risk, high-reward research program in fiscal 2010. Administration officials, including Energy Secretary Steven Chu, have championed the program, and the boost in this year's funding request is a show of confidence for the program, which has so far awarded 37 grants of about $4 million each.

Under the administration's request, funding for ARPA-E would be pulled out of the Office of Science and funded separately.

The Office of Science would also see a significant jolt in funding under the president's request. The administration would provide the office, which operates the bulk of DOE's research and development programs as well as 10 of the nation's 17 national laboratories, with $5.12 billion, an increase of about 4.5 percent over fiscal 2010 appropriated levels.

Contributing to that boost is a $226 million increase in basic research and laboratory funding.

A program funding basic energy research would get a 12 percent boost over fiscal 2010 appropriated levels to discover new ways to produce, store and use energy. The $1.8 billion request for basic energy sciences would support fundamental research as well as two innovative programs championed by Chu: the energy frontier research centers and energy "innovation hubs."

In its funding request for fiscal 2010, the administration called for funding eight hubs in various energy and engineering disciplines, but Congress provided appropriations for three. The request for fiscal 2011 does not specify whether the additional six hubs should be funded.

Renewable energy

As with the overall DOE budget, the administration is asking Congress for a 5 percent increase for the energy efficiency and renewable energy section of the budget.

The requests reflect a sharp turn toward Democratic-favored sources of energy such as wind and solar and energy-saving methods such as weatherization. Those increases come at the expense of the George W. Bush administration's favorites like hydropower and hydrogen.

Weatherization programs are the biggest winner. The administration sought $385 million, an 83 percent increase from the $210 million that Congress approved last year.

The request for wind power jumped 54 percent, from $80 million last year to $123 million this year. The administration also wants a big boost in solar programs, seeking a hike from $225 million last year to $302 million this year, which would be a 34 percent increase.

The budget proposal recommends a 21 percent cut for the hydrogen technology program, taking it from $174 million to $137 million. But that is not unexpected.

President George W. Bush had made the idea of hydrogen cars the centerpiece of his renewable energy and energy independence plans. But the Obama administration essentially sought to nix the program. It requested zero dollars for the hydrogen program and suggested limiting research to nonvehicle fuel cells.

The Senate did not share the same disdain and put $190 million in the bill. In conference, lawmakers settled on the $174 million figure.

Hydropower, a favorite of Western developers, would also take a cut if Obama gets his way. The administration is seeking to slice the program's funds from $50 million to $41 million, a 9 percent cut.

The administration's 2011 budget also includes $500 million to cover initial fees, or "credit subsidies," to support the $3 billion to $5 billion in loan guarantee authority for energy efficiency and renewable energy projects.

Fossil energy

Fossil energy programs would decrease slightly from fiscal 2010 appropriated levels, but carbon capture and sequestration research, development and demonstration projects will remain strongly funded.

The president requested $587 million for the Office of Fossil Energy after the office was appropriated with a little more than $700 million in fiscal 2010. That figure was supplemented by $3.4 billion for carbon capture and storage projects in the stimulus bill.

The fiscal 2011 request includes no funding for FutureGen, a $2.4 billion public-private project envisioned as a commercial-scale integrated gasification combined cycle (IGCC) power plant with carbon capture and sequestration capability. The program was conceived and then axed by George W. Bush's administration before being resurrected by the Obama administration last year, although the administration has not given its final word on the project's future.

Exelon Corp. gave a show of confidence this weekend by announcing it would join the FutureGen Alliance (see related story). And DOE is expected to announce a decision in the coming weeks about whether the project has obtained the required additional funding and cost reductions.

DOE has said it plans to spend about $1.1 billion on the Illinois project, but the vast majority of that funding will come from the $3.4 billion for carbon capture and storage in the stimulus law.

The president would cut $34 million in funding for the Strategic Petroleum Reserve compared with appropriated fiscal 2010 levels. The requested $210 million would provide ongoing storage site operations and maintenance activities as well as provide further insurance against oil supply disruptions. The president's budget would cancel plans for new site expansion proposed by previous budgets and appropriations and instead use those funds to account for the cut.

Nuclear energy

The most significant item for nuclear energy is laid out in the loan guarantee program, but the 2011 proposed budget also provides a 5 percent increase for research and development of nuclear technology for a total request of $824 million. The budget would eliminate funding for programs created under Bush including Nuclear Power 2010 and Generation IV.

Obama instead seeks to create new R&D programs "to better align program functions with strategic goals." The budget supports work on small modular reactors, long-term use of lightweight reactors and next generation nuclear reactors with $195 million for the "Reactor Concepts Research, Development and Demonstration" program. The White House also proposes $99 million to work on "cross-cutting" and "transformative" solutions for the full nuclear cycle in the "Nuclear Energy Enabling Technologies" program, which includes $24 million for a modeling and simulation hub.

The "Fuel Cycle R&D" program aimed at researching and developing waste recycling technology receives $201 million, a more than $40 million jump from the $136 million provided by Congress in the 2010 funding.

Nonproliferation numbers jump for NNSA

The National Nuclear Security Administration (NNSA) would receive $11.2 billion under the president's request, a 13.5 percent increase from fiscal 2010 appropriations. That amounts to just over 39.4 percent of DOE's $28.4 budget request.

In its comments on the proposed budget, the administration highlighted a $550 million increase in the request for programs aimed at preventing nuclear proliferation, including "full funding" of programs to secure nuclear material; develop technology that targets nuclear testing and smuggling; and support international treaties, controls and regulations for nonproliferation.

The request includes $8.1 billion to improve the safety, security and effectiveness of the nuclear weapons stockpile, a $750 million boost over 2010 appropriations, DOE said.

When broken out by program, NNSA's nonproliferation activities would see a 22 percent increase in funding under the proposed budget, going from nearly $2.2 billion appropriated in fiscal 2010 to $2.687 billion.

The Global Threat Reduction Initiative would see the biggest increase, going from $224 million in 2010 appropriations to $559 million for a 67 percent boost. That program seeks to secure vulnerable nuclear and radiological materials at civilian sites around the world and addressing nuclear material and research reactors.

Programs for nonproliferation and verification R&D and international nuclear materials protection would also see increases, while a program for nonproliferation and international security would get slightly less funding and a program for the elimination of weapons-grade plutonium production, scheduled to complete its work in 2010, would be zeroed out from the $83 million appropriated in fiscal 2010.

A program for surplus fissile materials disposition would increase by 31 percent to $917 million under the proposal. In last year's budget, that program included funding for mixed-oxide fuel fabrication, though this year's document does not specify what that includes.

NNSA funding for the environmental cleanup of defense sites would be slightly below 2010 appropriated figures under the proposed budget, with a proposed $5.58 billion, or a 2.5 percent decrease. Non-defense environmental cleanup is cut under the proposed budget to $238 million, after Congress provided $245 million for 2010.

Reprinted from Greenwire with permission from Environment & Energy Publishing, LLC., 202-628-6500