Trump Proposes Big Cuts; Environmental Groups React
Clean energy and environmental advocacy groups are speaking out against the Trump administration’s newly released 2018 budget proposals for discretionary spending – which, among other things, would cut U.S. Environmental Protection Agency (EPA) spending by one-third.
Among the proposals, President Donald Trump has “called for attacks” that would dismantle both the EPA and the U.S. Department of the Interior (DOI), according to the Sierra Club. The plans for the EPA’s budget include “decimating its staff and lifesaving programs,” and the DOI proposals would “sharply reduce the budget to protect America’s parks, public lands and wildlife,” the group says.
According to the White House proposal, the president’s 2018 budget requests $5.7 billion for the EPA – representing a reduction of $2.6 billion, or 31%, from 2017.
In addition, according to a press release from the DOI, Trump’s $11.6 billion proposed budget would save taxpayers $1.5 billion (a 12% reduction over 2017). Specifically, the agency says it “prioritizes strengthening America’s energy security” by increasing funding for programs that support the responsible development of oil, natural gas, coal, and renewable energy on public lands and offshore waters.
However, the Sierra Club claims the budgets would strip funding that enables the U.S. to meet its commitment to the Green Climate Fund, as well as slash funding for clean energy research efforts at the Advanced Research Projects Agency-Energy.
“Money talks, and Trump’s budget proposal screams that the only thing that matters in his America is corporate polluters’ profits and Wall Street billionaires,” states Michael Brune, executive director of the Sierra Club. “If Trump refuses to be serious about protecting our health and climate or our publicly owned lands, then Congress must act, do its job and reject this rigged budget.”
Furthermore, Paul Getsos, national coordinator of the Peoples Climate Movement, which is holding a march in Washington, D.C., this month, says, “Massive cuts in the Environmental Protection Agency will make it easier for corporations to pollute our lakes and rivers that we rely on for clean water and recreation. Cuts to economic development programs in urban and rural areas will hurt low-wage workers, especially struggling communities across the country.”
However, Thomas Pyle, president of American Energy Alliance, maintains that the budget would provide a “much-needed resetting of the relationship between the federal government, the states and the American people.” The cuts to the EPA and DOI, in addition to other federal agency cuts, “eliminate the architecture of President Obama’s politically motivated climate action plan,” he claims.
“While this is just an early step in the budget process,” he says, “President Trump’s plan sets the tone for reining in wasteful spending and costly, duplicative regulations. Let’s just hope that Congress follows the president’s lead and enacts these much-needed reforms.”
Speaking specifically on the EPA budget cuts, Pyle adds, “President Trump is sending a clear message that the EPA will no longer waste taxpayer dollars to carry out the previous administration’s climate action plan. The argument that this proposal would keep EPA from doing its job holds no water.”
In addition, under the Obama administration, he says, the DOI “adopted a ‘keep-it-in-the-ground’ approach that prevented the responsible development of our energy resources, especially natural gas, oil and coal.”
However, Margie Alt, executive director of Environment America, calls the budget proposal “dirty and dangerous.”
“Slashing EPA’s overall budget by more than a third means the agency cannot adequately enforce our clean air and clean water safeguards,” she says. “It is basically a ‘get-out-of-jail-free card’ for polluters. In addition, Trump’s proposed budget underfunds environmental issues that matter to millions of Americans – like climate action, clean energy and our national parks.”
Oklahoma’s Early Tax Credit Phaseout
On March 9, Oklahoma’s House of Representatives passed H.B.2298, which would end the state’s production tax credit for wind energy production three-and-a-half years earlier than current law.
This measure was first proposed in Gov. Mary Fallin’s 2018 executive budget.
The bill provides a July 1, 2017, sunset date for wind facilities to be eligible for the zero-emission tax credits. Wind facilities must be placed in operation prior to that date to be eligible for the tax credits. The rate of the tax credit is unchanged at 0.5 cents per kilowatt-hour.
Interestingly, the early deadline only applies with respect to electricity generated by wind. The bill retains the original Jan. 1, 2021, deadline for other zero-emission facilities, such as solar or geothermal facilities. However, the vast majority of zero-emission energy production in Oklahoma is from wind.
With the deadline to be placed in operation just three-and-a-half months away, should this bill become law, Oklahoma wind projects that are already in construction – and are relying on the tax credits – may not be able to be placed in operation in time to qualify for the state tax credits.
The bill passed the House by a 74-26 vote and now goes to the Oklahoma Senate, where the Republicans hold a 42-6 seat advantage.
Fallin also proposed in her budget a new production tax of 0.5 cents per kilowatt-hour on electricity generated by wind. This bill does not include the proposed production tax. As noted in previous coverage, the new production tax may be more difficult to enact because it would require a three-quarters majority to pass through the Oklahoma legislature. – David Burton & Binyomin Koff
David Burton is a partner and Binyomin Koff is an associate at law firm Mayer Brown LLP. This blog was reposted with permission from the firm’s Tax Equity Times.
Raimondo Plots Whopping Renewables Increase
The governor of Rhode Island, home to the U.S.’ first operating offshore wind farm, has set forth an ambitious goal to grow renewable energy in the state: Specifically, Gina Raimondo is seeking to increase this sector by a whopping 1,000%.
As explained in a March 1 tweet from Raimondo, the Democratic governor announced the goal at the North Kingstown, R.I.-based Quonset Development Corp., a Rhode Island Commerce Corp. subsidiary:
According to local coverage from Providence Business News, the governor’s goal calls for 1 GW of renewable energy by 2020 – a tenfold increase over the state’s current levels.
The report cites a speech from Raimondo: “Every step we take toward a clean energy future is a step toward a stronger, more sustainable environment and economy.”
In 2016 – the baseline year for the new goal – the state had roughly 100 MW of clean energy, according to a press release from the governor’s office.
“The goal will include energy from a broad portfolio of clean energy resources, including offshore and onshore wind and solar,” the release explains. “Homeowners, municipalities, institutions, and private commercial and industrial enterprises can contribute to the goal with smart investments in clean energy.”
However, the Providence Business News article brings up a notable point: There is not yet any legislation to go along with the governor’s goal. Rhode Island Congressman Aaron Regunberg reportedly said, “We need to actually do some things to reach that goal and get on pace,” considering the state is not currently on track to “take renewable generation to that scale.”
Notably, last summer, Rhode Island’s neighbor to the north enacted legislation to cement its renewable energy ambitions. Gov. Charlie Baker, R-Mass., signed into law “An Act Relative to Energy Diversity,” which, among other provisions, requires Massachusetts to generate 1.6 GW of power from offshore wind over the next 10 years.
As of June 2016, approximately 95% of Rhode Island’s net electricity generation was derived from natural gas, according to figures from the U.S. Energy Information Administration.
However, according to the “2016 Rhode Island Clean Energy Jobs Report,” clean energy employment, accounting for 13,776 jobs, spiked 40% in 2016 over 2015. (Besides renewables, “clean energy” also includes energy efficiency, renewable heating and cooling, and alternative forms of transportation.)
Although energy-efficiency employment comprised the majority of these jobs (eight out of 10), and renewables accounted for 14%, renewables employment did, however, nearly double its numbers over 2015. Specifically, the report says, this workforce experienced an 84% increase in 12 months with the addition of 907 new jobs.
“While [renewable energy] remains a smaller portion of the clean energy economy, optimism regarding the state’s current offshore wind energy project, as well as third-party ownership and financing of solar projects, may signal that renewable generation is on pace to continue this growth in the short term,” the report says.
Along with Gov. Sam Brownback, R-Kan., Raimondo is head of the Governors’ Wind & Solar Energy Coalition, a renewable energy advocacy group, which recently sent a letter to the Trump administration to emphasize the “boons of renewable energy.”
In December, a big renewables boost came to Rhode Island when Deepwater Wind finished up the 30 MW Block Island Wind Farm, the first offshore project in the U.S. Raimondo noted that she was proud to be governor of the only state with “steel in the water and blades spinning over the ocean.”
Now, Raimondo says in the latest press release, “Our commitment to expand our clean energy portfolio will help lower energy costs, create jobs and protect the beauty of our state for future generations.
“As the technology advances, an affordable, clean energy future is no longer simply a dream. Because of the investments we’ve made and with partnerships across the state, we will increase the amount of clean energy in Rhode Island by 1,000 percent, and we’ll double our green economy workforce,” she says.