xFears were that the EAE could suffer because the budget was strongly geared to deficit reduction. NRCan's overall budget was cut by over 50 per cent, from $1.3 billion to $638 million over the next three years. Drastic cuts were made to traditional supply side energy development funding, particularly fossil fuel developments and funding of "energy mega projects" such as the Hibernia offshore oil drilling project, near the coast of Newfoundland in the Atlantic Ocean, indicates assistant deputy minister David Oulton.
These decisions appear to signal a retreat by Ottawa from many forms of unsustainable, large scale energy promotion. Thus, the federal government seems to have accepted one part of the recommendations of the federal "task force on economic instruments" which advocated a major shift in federal spending to energy efficiency and sustainable and renewable energy development (Windpower Monthly, February 1995).
Funding for EAE development declines to $64.4 million in 1995-96 from $65.2 million in 1994-95, while energy supply funds fall to $232.7 million from $989.3 million in the same period. NRCan has committed to the increased promotion of alternative and sustainable energy, and energy efficiency, although without apparently any increased funding in these areas.
Meantime, the 1995-1996 budget of Atomic Energy of Canada Ltd was not cut, indicating that subsidies to the nuclear industry are expected to remain stable at least through 1997.