Budget Cuts Could Undermine Energy Innovation, ITIF Says

February 1, 2018

WASHINGTON—Following reports of the release of the Trump administration’s proposed budget for Fiscal Year 2019, the Information Technology and Innovation Foundation (ITIF), one of the world’s top-ranked science and tech policy think tanks, released the followed statement from Senior Fellow David Hart:

Recent reports suggest that the Trump administration will propose drastic cuts to the Department of Energy’s Office of Energy Efficiency and Renewable Energy (EERE). If the reports are accurate, the cuts would represent an enormous lost opportunity for job creation, productivity and economic growth.

The United States must accelerate progress toward cheaper, cleaner energy, in part to gain a leadership position in key global growth industries of the 21st century. Sustained federal investment in research, development, demonstration, and early deployment of promising technologies is an essential component of driving down the costs of clean energy.

If enacted, these cuts would also raise the odds that at some point in the future costly and heavy-handed regulation and taxes will be needed to transform the energy system. ITIF urges the administration to propose a budget that expands federal energy RD&D investments and calls on Congress to enact such a budget, even if the administration proposes cuts.

ITIF has highlighted several key programs within EERE that would be particularly damaging to cut, as the administration has proposed:

  • Energy Storage: Energy storage is an increasingly vital function for electricity systems in the 21st century. Variable renewable generation and increasingly flexible demand are already raising the value of storage, and it may rise further as baseload-power generation declines and transportation end uses expand. While lithium-ion batteries are coming down quickly in price, they have limited functionality. New materials for battery components, coupled with careful system integration and attention to manufacturability, could yield superior batteries and strengthen the competitiveness of U.S.-based manufacturing. DOE funding for battery RD&D, much of which lies in EERE, is vital to sustain progress in this field.
  • National Laboratories: DOE’s national laboratory system was founded to support the Manhattan Project during World War II and includes such iconic institutions as Argonne, Lawrence Berkeley, and Oak Ridge National Laboratories. These labs are unique concentrations of technical capabilities that support multidisciplinary research on national problems and maintain large-scale scientific facilities used by researchers throughout academia and industry. The administration’s reported proposal would harm this system.
  • Clean Energy Manufacturing Institutes: Advanced manufacturing is a vital economic activity for the United States, driving innovation and exports. The Manufacturing USA institutes fill a key gap in the innovation ecosystem, linking academic research to industry needs and fostering workforce development in support of regional economic growth. DOE supports five of these industry-led institutes, among them the  Institute for Advanced Composite Materials in Knoxville, Tennessee, and Power America in Raleigh, North Carolina. DOE’s investments in them have been more than matched by private and state investments.

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