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U.S. Economic Stimulus Package Includes Billions for Energy and the Environment

Green Initiatives, Tax Incentives are at Core of 2009 Economic Stimulus Package

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President Obama points into a crowd of supporters

President Obama points to a supporter before signing the economic stimulus package in Denver.

Photo by John Moore/Getty Images
The American Recovery and Reinvestment Act of 2009—the $787.2 billion economic stimulus package proposed by President Barack Obama and passed by Congress in mid-February [2009]—is intended to put America back to work and to help shorten the recession.

According to the Congressional Budget Office (CBO), the stimulus package is expected to increase gross domestic product (GDP) growth between 1.4 percent and 3.8 percent by the fourth quarter of 2009 and to create up to 2.3 million new jobs during the same period. More than $71 billion will be invested in green initiatives—from energy conservation and efficiency to mass transit to environmental cleanup—along with $20 billion in green tax incentives.

Green provisions in the stimulus package include:

Energy Investments

  • $4.5 billion for repair of federal buildings to increase energy efficiency using green technology.
  • $11 billion for smart-grid activities, including work to modernize the nation’s electric grid.
  • $6.3 billion for Energy Efficiency and Conservation Grants to help state and local governments make investments that make them more energy efficient and reduce carbon emissions.
  • $5 billion for the Weatherization Assistance Program to help low-income families reduce their energy costs by weatherizing their homes and make our country more energy efficient.
  • $2.5 billion for energy efficiency and renewable energy research.
  • $2 billion in grant funding for the manufacturing of advanced batteries systems and components and vehicle batteries that are produced in the United States.
  • $6 billion for new loan guarantees aimed at standard renewable projects such as wind or solar projects and for electricity transmission projects.
  • $1 billion for other energy efficiency programs including alternative fuel trucks and buses, transportation charging infrastructure, and smart and energy efficient appliances.
  • $500 million to prepare workers for careers in energy efficiency and renewable energy fields.
Infrastructure Improvements
  • $4.2 billion to invest in energy efficiency projects and to improve the repair and modernization of Department of Defense facilities, including Defense Health facilities.
  • $1 billion for the Bureau of Reclamation to provide clean, reliable drinking water to rural areas and to ensure adequate water supply to Western communities affected by drought.
Transportation Improvements
  • $8.4 billion for investments in public transportation.
  • $1.5 billion for competitive grants to state and local governments for transportation investments.
  • $9.3 billion for investments in rail transportation, including Amtrak, high speed and intercity rail.
Environmental Clean-Up and Clean Water Investments
  • $6 billion to clean up former weapon production and energy research sites.
  • $6 billion for local clean water and drinking water infrastructure improvements.
  • $1.2 billion for EPA’s nationwide environmental cleanup programs, including Superfund.
  • $1.38 billion to support $3.8 billion in loans and grants for water and waste disposal facilities in rural areas.
Scientific Research
  • $3 billion for the National Science Foundation, including $2 billion for expanding employment opportunities in fundamental science and engineering to meet environmental challenges and to improve global economic competitiveness.
  • $2 billion to the Department of Energy for basic research into the physical sciences including high-energy physics, nuclear physics, and fusion energy sciences and improvements to DOE laboratories and scientific facilities. $400 million is for the Advanced Research Project Agency–Energy to support high-risk, high-payoff research into energy sources and energy efficiency.
  • $1 billion for NASA, including $400 million to put more scientists to work doing climate change research, including Earth science research recommended by the National Academies.
  • $600 million to the National Oceanic and Atmospheric Administration (NOAA) for construction and repair of facilities, ships and equipment to improve weather forecasting, support satellite development and address critical gaps in climate modeling.
What Did Congress Leave Out of the Stimulus Package?
Many environmentalists are nearly as happy about what Congress took out of the stimulus package as they are about the green funding lawmakers put in. The Senate version of the stimulus package initially included $50 billion in loan guarantees for the nuclear industry and $4.6 billion for carbon-capture-and-sequestration (CCS) technologies for coal-fired power plants. Both provisions were dropped when the House and Senate went into conference to craft the compromise legislation that Congress later passed and the president signed into law—or so most people thought.

The money for the nuclear industry is gone, there is no question about that, but the coal-related CCS money didn’t really go away. Despite reports to that effect, the stimulus package still includes $3.4 billion for CCS programs.

Specifically, the detailed summary of the stimulus package posted by the House Appropriations Committee says the $3.4 billion is “for carbon capture and sequestration technology demonstration projects. This funding will provide valuable information necessary to reduce the amount of carbon dioxide emitted into the atmosphere from industrial facilities and fossil fuel power plants.” Other documents related to the stimulus package say the money is for fossil fuel programs, but fail to provide details about what those programs might be.

Most likely, the final decision on how that money gets spent will fall to Energy Secretary Steven Chu, who called coal his “worst nightmare” before Obama nominated him for the nation’s top energy job. More recently, at his confirmation hearing, Chu expressed a more positive view of coal and CCS technology and their place in America’s energy future.

"I am optimistic we can figure out how to use those resources in a clean way," Chu said. "I'm very hopeful that this will occur, and I think that we will be using that great natural resource."

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