Washington (Platts)--25Apr2012/448 pm EDT/2048 GMT

The US House Appropriations Committee on Wednesday passed on to the full chamber a Department of Energy spending bill that would cut $345 million from the agency's fiscal 2013 budget, providing it with $26.1 billion, and would shift emphasis from renewable energy and energy efficiency to fossil fuels and nuclear power.

"While the decisions involved were difficult ... I am proud that this committee will be the tip of the spear in helping to restore sustainability to the agency budgets within this bill," said Representative Hal Rogers, the committee chairman and a Kentucky Republican.

The committee passed the energy and water appropriations bill in a voice vote. The bill must still be taken up by the full House. No votes in the full chamber are planned, but few in Washington believe Congress will pass any annual appropriations bills before the presidential election in November.

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In his budget request to Congress in February, Obama moved to cut about $88 million from spending on nuclear power research and development, a 10% cut, and about $105 million from the fossil energy R&D, primarily from coal-related research.

But the House Appropriations committee aims to make up for those declines by refusing the Obama request and funding nuclear power at 2012 levels, instead providing flat funding for DOE's Office of Nuclear Energy at $765 million.

Republicans on the committee also said the bill would help bring down gasoline prices in the long run and that they have devoted $1.1 billion in their proposal for the effort.

Among other things, this includes $25 million for a new shale oil research program, $34 million for other fossil energy research aimed at increasing domestic oil supplies, $500 million for applied advanced biofuels research and $195 million for electric vehicle research. While these total about $36 million above what Congress gave DOE in 2012, they are about $92 million less than what Obama requested.

DOE'S EERE WOULD SEE 17% CUT

DOE's Office of Energy Efficiency and Renewable Energy, which funds applied research and development of wind, solar, energy efficiency and other energy technologies, has long been a target of congressional Republicans and this funding proposal illustrated that.

The committee bill would cut EERE funding for fiscal 2013 by about 17% from fiscal 2012 levels to $1.5 billion. Obama had requested an almost 30% increase to $2.3 billion for 2013.

While senior Democrats on the committee praised funding for nuclear and fossil fuel, they also said that EERE should get more funding.

"I appreciate the chairman's decision to include appropriate funding for fossil and nuclear energy. However, I am disappointed the renewable energy programs in this bill are drastically reduced," said Representative Peter Visclosky, the senior Democrat on the appropriations subcommittee that oversees DOE's budget.

"In providing critical research and development for those sectors that currently provide the bulk of our electricity generation, we cannot sacrifice the future," he said. "Renewable energy can achieve cost competitiveness, but a continued and sustained research and development program is necessary and appropriate in order to do so."

BILL ALLOTS $25 MIL FOR YUCCA MOUNTAIN

Republicans and Democrats on the committee did agree that the Obama administration's decision to terminate the long-planned Yucca Mountain nuclear waste repository in Nevada was misguided and "counter to the law." The committee bill attempts to fix that by providing DOE with $25 million to work on a solution to storing commercial nuclear waste, but only if it is directed at Yucca Mountain. Also, the bill would bar DOE from spending any funds to eliminate the option of Yucca Mountain as a waste site.

Those measures could face opposition in the Senate, however, where Senator Harry Reid, a Nevada Democrat and majority leader, has vowed the Yucca Mountain repository will never be built.

In fact, an appropriations bill passed by the Senate Appropriations Energy and Water Development Subcommittee on Tuesday provided no funds for Yucca Mountain. It did, however, include a provision that would create a DOE pilot program for siting and developing an interim consolidated storage site for commercial spent nuclear waste.

The Senate Appropriations Committee is set to take up its own version of the energy and water development appropriations bill on Thursday. That bill would provide DOE with $27.1 billion in 2013, an increase of $1.38 billion above fiscal 2012. That is $1 billion above the $26.1 billion provided by the House committee.

--Derek Sands, derek_sands@platts.com

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