On Feb. 14, U.S. Pres. Barack Obama made a proposal to Congress to raise 2012 budget funds for renewable energy research. He proposed paying for this budget increase by cutting subsidies for fossil fuels including gas and oil.
This budget increase comes at a rather sensitive time for the White House. Recently, the U.S launched a World Trade Organization (WTO) dispute against China. The dispute is regarding the country’s support for wind power production and research. Additionally, Japan recently initiated a WTO dispute against Canada for their support of renewable energy subsidies.
Even though the U.S. disapproves of China’s support of wind manufacturing, Obama still seems to be placing a high priority on green energy as a whole. He undoubtedly recognizes that certain measures need to be taken if the U.S wants to compete with other countries that have already gone to great lengths to develop renewable energy technologies and resources.
Obama has proposed an amount of $29 billion for the Department of Energy in 2012. This number is up more than 4 percent from the 2011 budget and more than 10 percent from the 2010 budget, a substantial sum. And $8 billion, more than 30% of the Department’s total proposed 2012 budget, is earmarked to support renewable energy initiatives. These initiatives include research to support wind and solar power and new nuclear energy technologies.
But these budget increases will not come with out a cost to other areas of the budget. Pres. Obama is asking Congress to revoke almost $4 billion dollars in fossil fuel subsidies. If approved, this number would jump to over $46 billion over the course of ten years.
But not everyone is in support of this proposed budget increase. Many Republican leaders are against cutting subsidies for fossil fuels. They argue that this cut would weaken certain industries that provide jobs for many Americans at a time when the U.S economy is still vulnerable and unemployment rates are still high.
If Congress does approve Obama’s budget increase, there is no way of knowing exactly how it might affect energy suppliers and the resources that they provide to customers all over the United States. All energy consumers can do right now is speculate how this budget increase might affect energy prices and availability in the coming years.