Energy Winners and Losers in the Omnibus Appropriations

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The fiscal year 2022 omnibus spending bill that Congress passed late last year before adjourning for the holidays, providing federal executive branch agencies some $1.5 trillion in funding through September 2023, contains a lot of money for energy programs. But it also causes heartburn among some electricity interests for what it does not contain.

First, the big picture. According to the National Conference of State Legislatures, “The legislation increases nondefense spending by 6.7% and defense spending by 5.6%, and it includes $13.6 billion in emergency aid for Ukraine.” The NCSL added, “The passage of the legislation allows for the full implementation of the historic investments in the Infrastructure Investment and Jobs Act. With the federal government operating under a continuing resolution, many of the infrastructure bill’s funding increases and new programs could not move forward.”

Here’s the NCSL’s Energy Department summary:

  • $44.9 billion, a $2.9 billion increase; that includes $7.5 billion for the DOE’s network of national labs, $449 million more than 2021 levels. It was the largest increase for any single DOE office.
  • $3.2 billion in funding for the Office of Energy Efficiency and Renewable Energy, a $338 million increase.
  • $185.8 million for the Office of Cybersecurity, Emergency Security and Emergency Response, a $29.8 million increase.
  • As a reminder, the Infrastructure Investment and Jobs Act also provided billions in FY 2022 appropriations.

For the Environmental Protection Agency:

  • $9.56 billion for the Environmental Protection Agency, a $322 million increase. Investments include water infrastructure and environmental remediation.
    • Water infrastructure investments include:
      • $2.76 billion for the Clean Water and Drinking Water State Revolving Funds, the same as 2021.
      • $178 million in grants to address nonpoint source pollution.
      • $70 million for water infrastructure loans through the Water Infrastructure Finance and Innovation Act.
      • $27.5 million to address lead in schools.
    • Environmental remediation investments include:
      • $1.23 billion for the Superfund program, $27 million more than FY 2021.
      • $46 million for Brownfields grants.
    • Other top investments include:
      • $587 million for geographic programs for the restoration of nationally significant bodies of water.
      • $420 million for the EPA’s clean air programs, and the creation of a new grant program to support community efforts to mitigate hazards posed by wildfire smoke.
      • $100 million for environmental justice initiatives at the EPA, a $90 million increase; the funding will support grants to environmental justice communities and encourage environmental justice principal integration across the agency.

For the Interior Department:

  • The bill provides a total of $14.1 billion for the Department of the Interior, $776 million above FY 2021. This includes:
    • $1.9 billion in accordance with the Great American Outdoors Act for projects within the National Parks and Public Land Legacy Restoration Fund and $900 million for Land and Water Conservation Fund projects. The $900 million includes $418 million for the federal program, $330 million for the state grants program and $152 million for other nonfederal grant programs.
    • $1.74 billion for the Bureau of Reclamation, which includes $155 million to fund long-term drought strategies in the West, including water storage, water recycling and reuse, and desalination.
    • $1.41 billion for the Bureau of Land Management, a $101 million increase, which includes:
      • $137 million for the wild horse and burro program, a $21 million increase.
      • $78 million for sage grouse conservation.
      • $49 million for National Conservation Lands.
    • $515 million for the Payment in Lieu of Taxes program, which fully funds payments to counties.
    • $286 million for the Office of Surface Mining Reclamation and Enforcement, a $46 million increase, including $149 million for the Abandoned Mine Reclamation Fund.

 

E&E News Energy Wire reported, “In addition to money for DOE, the package would expand funding for the Federal Energy Regulatory Commission, an independent agency with oversight of electric power markets and natural gas pipelines. FERC would get $508.4 million, up from $466.4 million in fiscal 2022.”

A controversial aspect of the DOE money is a spending priority on carbon capture and storage, E&E noted, slated to get a “$140 million for research, development and demonstration of carbon dioxide removal technologies across multiple offices — with DOE’s fossil office set to receive ‘not less than’ half of that funding, according to the report from Senate appropriators.” Maggie Coulter, an attorney with the Center for Biological Diversity, said, “It’s infuriating that the federal government is doubling down on the high-risk, proven loser that is carbon capture and storage. Sinking more money into CCS threatens communities and steals resources from the needed transition to clean, affordable renewable energy.”

Then there are those who didn’t get a seat on the omnibus. Most prominently, some $2.5 billion the electric utility and homebuilding industries were seeking to address the acute shortage of distribution transformers through the use of the Defense Production Act didn’t make it into the final bill. Joy Ditto, American Public Power Association president and CEO, in a statement to The Quad Report said, “APPA is beyond disappointed that funding to ramp up production of distribution transformers through the Defense Production Act has not been included in the Dec. 19, omnibus appropriations bill. This is a critical issue that several industries have raised, and on which the President has called for action. Despite our collective pleas over the past year to address this issue, supplies continue to dwindle, demand far outpaces production, and if action is not taken in the near term, the U.S. will face electric reliability concerns.”

Also, nuclear power interests are also upset that, while there were positive increases in the legislation, it missed the target on a fuel cycle issue the industry supports. Nuclear Energy Institute president and CEO Maria Korsnick said, “The lack of funding for the expansion of [low enriched uranium] LEU capacity and insufficient funding for the sustained domestic production of [high assay, low enriched uranium] HALEU jeopardizes the continued operation of the country’s largest source of carbon-free energy as well as the next generation of nuclear reactors.”

–Kennedy Maize

kenmaize@gmail.com

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