Contents

1. A Win and a Loss on Farm Bill Clean Energy Program
2. National Renewable Energy Lab Faces Job Cuts
3. Working to Extend the Renewable Energy Production Tax Credit 

Summary

Members and activists helped UCS win several important clean energy victories in 2005. We secured Senate passage of a federal Renewable Electricity Standard and restored 2006 funding for a Farm Bill clean energy program. To learn more about those victories, recent global warming votes, and the disappointing passage of a final energy bill, visit our September update.
 
Unfortunately, the tight federal budget led Congress to recklessly cut clean energy programs in the last few months. With Americans facing record high home heating costs, Congress should be investing more in clean, renewable energy programs. With your help, UCS will work in 2006 to restore federal clean energy funding and advance clean energy policies like the Renewable Electricity Standard.

We will also continue to advance important state clean energy policies across the country. Sign up for UCS’s EnergyNet email network to receive our year-end update summarizing state-level clean energy victories in 2005.

A Win and a Loss on Farm Bill Clean Energy Program

For the third year running, the Bush administration’s FY06 budget request slashed more than half of the $23 million in clean energy funding provided by section 9006 of the 2002 Farm Bill. UCS and our coalition partners successfully restored 2006 funding for this popular program, which reduces global warming pollution, boosts rural economies, and enhances our energy security by increasing our reliance on home grown renewable energy sources.

In a surprise move on October 28, the House Agriculture Committee voted to completely eliminate 2007 funding for the program as part of the Budget Reconciliation Act of 2005. The Committee also killed funding for the Farm Bill Value-Added Producer Program, which has provided nearly $20 million in feasibility study grants for nearly 100 renewable energy projects in the last four years. Although the committee has supported these programs in the past, members felt pressure from Republican leadership to reduce the overall budget. This means that UCS will again need to work with activists and coalition partners to restore funding for these important programs.

While the tight budget will pose a challenge, UCS is working to bolster support among key House members.  This fall, Representatives Mark Udall (D-CO) and Roscoe Bartlett (R-MD) circulated a letter to President Bush calling for fully authorized renewable energy and efficiency funding in the President's FY07 budget request.  UCS played a major role in securing signatures of House members on this letter. It was released on November 7 with 126 signatories, including 22 Republicans, demonstrating strong support for the funding of clean energy programs.

National Renewable Energy Lab Faces Job Cuts

In November 2005, the President signed an energy and water appropriations bill containing a $39 million package to support the development and deployment of clean energy technologies. Usually, the Department of Energy’s (DOE) Energy Efficiency and Renewable Energy (EERE) program manages most of those resources. However, the new appropriations bill set aside $13 million of the total amount for deployment projects in the districts of influential members of Congress. Although DOE could act to restore the lost EERE funding, it is unlikely to do so. These cutbacks will result in significant job losses at EERE’s National Renewable Energy Lab. EERE advances in clean energy technology and deployment have already saved consumers money and boosted economic development. UCS will work to increase the size of the EERE budget in 2006 while accommodating local clean energy projects. Due to the tight national budget activist pressure will be needed to secure this needed funding.

Working to Extend the Renewable Energy Production Tax Credit

The harmful energy bill passed by Congress in August 2005 did include a helpful extension of the Renewable Energy Production Tax Credit (PTC) through 2007. The 1.8 cents per kilowatt-hour credit for electricity produced from wind, closed-loop biomass, and poultry waste is vitally important for the deployment of renewable energy technologies. While the extension is welcome, its short-term nature limits the ability of renewable energy developers to gain the financing they need to start new projects beyond 2007.

On November 17, 2005, Senators Harry Reid (D-NV) and Olympia Snowe (R-ME) offered an amendment to the Senate’s tax cut package to extend the PTC through 2011. Senator Chuck Grassley (R-IA), chairman of the Finance Committee, has championed the PTC extension in the past, however this time, he "reluctantly opposed" the amendment. Without Senator Grassley’s key support, the amendment failed. While the loss is disappointing, it provided a valuable opportunity to weigh in with key senators on the need for a PTC extension. UCS will work to extend the tax credit in 2006.