President Biden Releases FY25 Budget Requests
Update provided by Meguire Whitney
On March 11, President Joe Biden released his FY25 Budget Request, the outline of his priorities for the year ahead. The budget documents will kick off a series of hearings with administration officials providing testimony on the president’s spending priorities.
The president’s budget includes increased funding for the Department of Energy—$51.4 billion, slightly more than the $50.2 billion agreed to for FY24. As expected, Biden includes increased funding levels for clean energy research and development programs, but also bolsters funding for weatherization and energy equity and justice programs. The budget proposes $8.6 billion for the Office of Science, up from the FY24 level of $8.24 billion, and also provides $150 million for advanced nuclear reactor demonstrations to access high-assay low-enriched uranium. $455 million was requested for AI technology to advance energy security and climate resilience, as well as $461 million (an 8% increase) in funding for cybersecurity, energy security, and emergency response.
The proposed budget also would provide $8 billion for the Climate Corps, a program that was cut from the Inflation Reduction Act, and $22 million for lower Snake River dams settlement implementation for “technical support, studies, and habitat restoration.” The Federal Energy Regulatory Commission requests $532 million, up from the FY24 level of $508.4 million, an increase of $23.6 million to hire staff. The budget also requests $11 billion for the Environmental Protection Agency, nearly 20% more than was agreed to in FY24.
Senate ENR Committee Examines Wildfire Mitigation and Response
Update provided by Meguire Whitney
The Senate Energy and Natural Resources Committee held an oversight hearing on wildfire management this week, with a focus on recommendations made by the Wildland Fire Mitigation and Management Commission. The commission was created by the Bipartisan Infrastructure Law to make recommendations on pre-fire mitigation, response, and post-fire recovery activities.
Senators and hearing witnesses all agreed the federal government needs to increase the pace and scale of forest treatments to reduce the risk of wildfire across forest landscapes. Both federal witnesses—Meryl Harrell, deputy undersecretary for natural resources and the environment at the Department of Agriculture; and Joan Mooney, principal deputy assistant secretary for policy, management, and budget at the Department of the Interior—emphasized the agencies’ efforts to treat more acreage and to partner with states and local non-federal partners to protect communities, critical infrastructure, and natural resources.
ENR Committee Ranking Member John Barrasso (R-Wyo.) expressed concern about the Forest Service’s plan to issue a new rulemaking to preserve old-growth forests and how the new proposal will affect the ability to manage wildfire threats. Committee Democrats, including Sen. Martin Heinrich (D-N.M.) defended the administration’s proposal, stating it is not intended to ban logging but to create better forest conditions to support carbon sequestration and habitat and to promote fire resilience. The following day, Barrasso introduced a bill to block the Forest Service’s still-to-be-finalized old-growth rulemaking from taking effect.
House Oversight Subcommittee Holds a Hearing on Grid Reliability
Update provided by Meguire Whitney
On March 12, the House Oversight Subcommittee on Economic Growth, Energy Policy, and Regulatory Affairs held a hearing to examine the reliability and security of the electric grid. Witnesses included former Federal Energy Regulatory Commission Commissioner James Danly, Cato Institute Director of Energy and Environmental Policy Studies Travis Fisher, and Converge Strategies Principal Jonathon Monken.
Questions from panel members focused on the impact of the Environmental Protection Agency’s proposed power plant rule, the Biden administration’s electric vehicle policies on grid reliability, and what Congress can do to better protect the physical security of the grid.
On the EPA proposed rule, Danly contended that EPA has not considered the reliability consequences and that no inquiry was made into the rule’s impacts on the organized markets and resource adequacy. Danly stressed that the lack of a clear understanding of the proposed rule may “lead to unforeseen consequences that could be deleterious.” Fisher noted in his remarks that the administration’s EV policies will significantly increase the amount of energy needed, which may lead to increased energy prices and energy shortfalls. On physical security, Monken said he believes the existing critical infrastructure protection standards are insufficient.
Senate ENR Committee to Hold FERC Nominations Hearing
Update provided by Meguire Whitney
The Senate Energy and Natural Resources Committee announced a hearing on the three nominations to the Federal Energy Regulatory Commission will be next week, but election-year politics makes the nominees’ confirmations uncertain.
The nomination hearing provides ENR Committee members an opportunity to ask pointed questions to the nominees to highlight their views on climate, renewable energy, the future of fossil fuels, transmission planning, and other topics. For instance, one of the nominees, Lindsay See, served as solicitor general of West Virginia and argued the West Virginia v. EPA case before the Supreme Court. That led to the Court’s decision that the Obama administration’s Clean Power Plan overstepped its authority to regulate greenhouse gas emissions. Another nominee, Judy Chang, has been a climate hawk with a history of supporting significant climate and clean energy resources as Massachusetts’ undersecretary of energy and climate solutions. The third nominee, David Rosner, a FERC staffer detailed to the ENR Committee, is considered the least controversial and has the most experience with the commission.
Without confirmation of new nominees, FERC may be left without a functioning quorum if Commissioner Allison Clements resigns when her term ends in June.
Administration Expected to Release Multiple Rules Shortly
Update provided by Meguire Whitney
The Biden administration is expected to begin releasing rules at a rapid rate over the next few weeks, with a new proposal released March 8 on protecting the greater sage grouse. Previous efforts to protect the bird’s western habitat have been controversial due to the impact on energy production activities on federal lands. In related news, the administration’s long-awaited methane rule was also published March 8 in the Federal Register, ending a lengthy delay at the printing office. More rules and guidance, including the Environmental Protection Agency’s final greenhouse gas rules for power plants and documents implementing clean energy tax credits, are expected in the very near term.
Budget Office Predicts No Automatic Cuts to Nondefense Programs
Update provided by Meguire Whitney
On March 13, the Congressional Budget Office said nondefense programs in the recently passed FY24 spending package will not be subject to automatic cuts, also known as sequestration. The Fiscal Responsibility Act passed last year included a provision that would mandate a 1% automatic, across-the-board cut from FY23 spending if a full-year FY24 appropriations bill was not enacted by April 30, 2024. The new forecast from CBO stated the FY24 six-bill spending package passed March 8 by Congress likely shields nondefense programs from sequestration. The authority to decide whether sequestration is required and calculate the percentage of reductions ultimately lies with the Office of Management and Budget.