$21 Million in FY '06 Energy-Efficiency Federal Budget Cuts Aggravates Energy Price, Supply Crises, Says Alliance to Save Energy

Release Date: Tuesday, February 8, 2005

Washington, D.C., February 7, 2005 – “By cutting federal funding for energy efficiency, President Bush’s fiscal year 2006 Department of Energy budget takes the wrong approach at the wrong time,” Alliance to Save Energy President Kateri Callahan said today. “Escalating oil, gasoline, and natural gas prices are putting a stranglehold on business, industry, and consumers alike and causing disruptive fluctuations in financial markets. We need increases – not cuts – for crucial energy-efficiency programs that help the nation reduce overall energy use and lower costs.

“Energy efficiency is an essential investment,” Callahan noted. “Studies demonstrate that every dollar invested in DOE-administered energy-efficiency R&D returns $20 to the nation’s economy. And every dollar invested in EPA’s Energy Star program cuts energy costs by $75 and sparks $15 of investment in new efficiency technologies.”

“Cutting funding for programs that deliver a return on the investment is short-sighted and shortchanges America’s consumers, our energy security, and our environment. We call on Congress to reject the proposed budget cuts in energy-efficiency programs and to increase funding to levels that will bring real benefits to our economy,” Callahan said.

Overall, the proposed Bush budget would cut DOE energy-efficiency programs by $21 million, which represents a 2 percent cut from FY ’05 appropriations. With this overall reduction, many important programs were hit hard. Aggravating DOE’s already severe delays in issuing new appliance standards, which lock in savings by mandating minimum efficiency levels for energy-using products, are proposed cuts of $1.9 million, or 19 percent. Building codes – another way to ensure energy savings throughout the economy – would be cut by $1.5 million, or 21 percent, reversing funding gains made last year. Funding for building technologies R&D would receive a $7.5 million, or 11 percent, cut. The Federal Energy Management Program would be cut by $0.8 million, or 4 percent.