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United States

BUDGET CUTS LOOK CERTAIN DESPITE PUBLIC OPINION

The sweeping political changes now under way in Washington DC are almost certain to lead to lower renewables budgets, but as yet it is far from clear what the impact on wind energy development will be. Reductions in renewable research and development funding, cuts in energy efficiency programmes and the elimination of the entire Department of Energy (DOE) are all being proposed.

Republicans in both houses of the US Congress issued budget plans in the second week of May that would drastically cut government funding by about $1 trillion over the next seven years. This attempt to balance the budget is somewhat in line with the conservative anti-government sweep in the November elections.

Even so, opinion polls show that most ordinary Americans want federal support for renewables. November's swing to the right was more out of general frustration with big government and with what voters see as encroachment of their individual rights. President Bill Clinton has also promised to veto the bill that would cut into this year's energy budget. On May 18 Clinton said he would veto plans to axe $16.4 billion from the fiscal year 1995 federal budget, including an overall 30% reduction in the renewables budget. What portion of that would be cut from wind is unclear.

It is known that one of the plans includes axing the DOE entirely, as well as the Departments of Education and Commerce. The plan issued in the Senate, currently the less conservative of the two bodies that make up the US Congress, would reduce energy spending overall from $5 billion to $3 billion by the year 2002, although it does not propose eliminating the DOE.

"There's no question the budget's going to be cut," says Randy Swisher of the American Wind Energy Association. But he stresses that it is too soon to tell how far the changes will go, since opposition to the swingeing cuts will be significant. He maintains that wind is in a better position to defend itself than some renewable energy technologies.

But AWEA's Mike Marvin adds that most disturbing is the entire change in philosophy proposed. At issue, he says, is ultimately whether the federal government will continue to have a role in the commercialisation of renewables, or whether commercialisation will become a matter entirely for the private sector. The proposals are also contrary to the 1992 Energy Policy Act, says Swisher, which calls for a five year contract for development and demonstration of renewables. The budget resolutions are shortsighted, adds Swisher, and will not encourage a stable, diverse energy supply.

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