Biden signs bill cutting EPA, DOE spending as fiscal 2025 budget fight begins

President Joe Biden March 11 unveiled his budget request for fiscal year 2025, just days after skirting a partial government shutdown by signing a six-bill appropriations package that cuts fiscal year 2024 funding for the Environmental Protection Agency and some parts of the departments of Energy and Interior.

The $460 billion package passed the Senate by a 75-22 vote March 8 after the House of Representatives advanced the so-called minibus in a 339-85 vote. It funds a number of agencies through Sept. 30, 2024, while a March 22 deadline still looms for the rest of the federal government.

Eyeing 2025

The president's new budget request for the fiscal year beginning Oct. 1, 2024, seeks to cut the deficit by $3 trillion over 10 years. Part of that plan hinges on eliminating tax subsidies for oil and gas companies. Such action would be expected to save the US $35 billion by ending special tax treatment for oil and gas company investments as well as other fossil fuel tax preferences, according to a White House fact sheet.

The proposed spending plan also targets the administration's displeasure with record oil company profits going towards stock buybacks and dividend payouts, instead of towards lowering gasoline prices. It proposes quadrupling the stock buybacks tax from 1% to 4%.

Substantial funds in the budget for fiscal 2025 would also advance Biden's mission to reduce greenhouse gas emissions; tackle the climate crisis through global leadership and investments in climate science, innovation and resilience; bolster clean energy development; and cut energy costs for consumers.

Presidents' budgets are often more symbolic in nature, laying out the administration's policy goals and direction. The heavy lifting to determine final funding levels is done by Congress.

Clean energy spending

As for the current fiscal year, lawmakers kept appropriations steady for the DOE's Office of Energy Efficiency and Renewable Energy and Office of Cybersecurity, Energy Security, and Emergency Response.

Nuclear energy got a boost from the recently passed bill. The legislation contains $1.7 billion for nuclear power, including related research, development, and demonstration activities, and $2.7 billion in repurposed funding for a program to supply high-assay low-enriched uranium for advanced reactors.

But appropriations will decline under the bill for other parts of the DOE, including the Office of Fossil Energy and Carbon Management.

The package also funds the Federal Energy Regulatory Commission at $520 million, though the appropriations sum will be reimbursed as the commission collects annual charges and filing fees from the industries it regulates. That spending level is up from the $508.4 million enacted for fiscal year 2023.

Cuts at EPA, Interior agencies

However, the bill cuts the EPA's overall budget by 10% year on year to around $9.2 billion. The drop is mainly for the agency's Superfund program, which is now primarily funded by tax receipts appropriated outside of the bill. New funding in the legislation for EPA programs outside of the Superfund was only cut by roughly 2.6% from fiscal year 2023.

"What we attempted to do within this budget is to prioritize funding for those programs that result in concrete actions to improve the quality of the environment across the country," Senator Lisa Murkowski, Republican-Alaska, said during debate on the bill March 8. "I think we tried to ensure that the mission moved forward in a way that does allow for that protection of the environment but recognizing that there are many areas within the EPA budget that we could look to reduce."

Overall appropriations for the Department of the Interior were higher, although spending will fall year-on-year for the Bureau of Ocean Energy Management and Bureau of Land Management, which oversee energy leasing on federal lands and waters.

Republican lawmakers boasted about fending off Democrats' efforts to increase offshore oil and gas inspection fees and authorize new fees for onshore oil and gas inspections.

But the fiscal 2024 spending package excludes a raft of Republican provisions to roll back climate and clean energy programs created by the Inflation Reduction Act. Also left out of the bill was language meant to fight the Biden administration's pause on key LNG export reviews.