President Obama’s fiscal 2016 budget proposal doubles down on his climate change agenda by making clean energy tax incentives permanent and proposing billions of dollars for new clean-energy funding and to help states slash emissions from power plants.
The proposals are red meat for some Democratic lawmakers but are likely non-starters in the Republican-controlled Congress. For Obama, the proposals underscore how much of the next two years will be shaped by defending his climate priorities against a GOP Congress.
In all, Obama’s budget calls for $7.4 billion in clean energy funding, an increase of $900 million over fiscal 2015. It also would send $4 billion to states interested in “exceeding the minimum requirements” for reducing power plant carbon emissions set forth in a proposed Environmental Protection Agency rule. The president also wants to keep intact the production tax credit, which primarily benefits wind energy, and the investment tax credit, which supports solar energy.
The Energy Department would receive $29.9 billion, a 9.5 percent increase. The Interior Department would see an 8-percent increase up to $13.2 billion, while EPA spending would rise 4.9 percent to $8.6 billion. The budget also includes a $500 million request for climate aid through the Green Climate Fund, the first piece of a $3 billion commitment Obama made to the United Nations-created bank for developing nations.
Senate Majority Leader Mitch McConnell, R-Ky., emulating House Republicans of years past, has said he plans to use the spending process to push funding toward favored GOP programs. That likely would include shifting money from targeted clean energy subsidies toward basic research and fossil fuels, along with stripping spending from efforts such as EPA climate change and greenhouse gas emission monitoring programs.
House Republicans have targeted such efforts in previous budgets to impede implementing regulations such as the power plant rule, which conservatives and industry groups say will raise electricity prices.
The White House budget proposes sending the EPA $239 million for its climate program, with an additional $25 million to help states comply with the power plant rule. The proposed power plant rule, the centerpiece of Obama’s climate agenda, aims to slash electricity emissions 30 percent below 2005 levels by 2030.
Maintaining the wind and solar energy incentives would help the Obama administration realize the goals established in the power plant rule. The 2.3-cent per kilowatt-hour wind incentive expires at the end of 2015, while the solar credit — which currently covers 30 percent of installation costs — would end after 2016 for residential projects and fall to 10 percent for commercial ones.
The subsidies are approved on a short-term basis and face congressional battles over being extended. Those skirmishes are getting more heated as free market-oriented conservative groups, some backed by the industrialist billionaire Koch brothers, have sought to generate opposition to the subsidies.
