Obama’s Budget Relies on Cap-and-Trade to Offset Costs

February 26, 2009

Email this story Print this post Add your comments

President Obama’s economic team Feb. 26 released details of his nearly trillion-dollar budget – to be funded in part by cap-and-trade limits on carbon emissions – revealing how the energy and environment sectors are likely to be impacted.

The 2010 budget commits $150 billion over 10 years toward seeking more energy independence, including research and funding for attempts to boost auto fuel efficiency, according to The Detroit News.

The effort includes doubling the production of renewable energy in three years, via tax breaks and loan guarantees for the industry, according to CNN/Money.com.

Obama hopes to raise some portion of the money for alternative energy development from cap-and-trade limits on carbon emissions.

Obama’s projection of garnering $646 billion revenue during the first eight years of a carbon-capping program may be a little low, two observers told Reuters.

“I don’t think it’s overly optimistic at all,” said Brian Murray, director for economic analysis at the Nicholas Institute for Environmental Policy Solutions at Duke University.

“It’s on the conservative side,” said Tim Profeta, the institute’s director.

The $646 billion figure presumes that a U.S. law to limit carbon emissions will be in place by 2012.

Among other funding methods, here are some measures of the budget that will impact the environmental and energy sectors:

$17 billion – reinstate Superfund taxes
$5.3 billion – excise tax on Gulf of Mexico oil and gas
$3.4 billion – repeal expensing of tangible drilling costs
$62 million – repeal deduction for tertiary injectants
$49 million – repeal passive loss exception for working interests in oil and natural gas properties
$13 billion – repeal manufacturing tax deduction for oil and natural gas companies
$1 billion – increase to seven years geological and geophysical amortization period for independent producers

The repeal of tax benefits for oil companies is likely to increase the cost of research and development in the sector, and may make alternative energies more palpable.

As Obama indicated previously, the budget includes programs for energy conservation in government buildings and homes alike. It promises more funds for clean coal plants, and there is a plan to revamp the electric grid.

President Obama also aims to reduce the budget deficit to half its current level.

Email this story Print this post Add your comments

Advertisers

Enhance Sustainability. Improve Profitability.

Learn how at the SAP Sustainability Resource Center. >>

Unclear about the EPA's new GHG Rule?

Learn how it could affect your business. >>

EPA mandatory emissions reporting starts Jan 1st

CSA Standards can help your organization get ready for compliance. Find out how. >>

Best Practices: Product Environmental Compliance

How to achieve compliance at a significantly lower cost. Download the full report. >>

Join the Discussion

Reader Comments

Foolish and foolhardy. Doesn’t get any more ridiculous than this. Say goodbye to what’s left of industry in this country and get ready for energy shortages.

Glennis | February 27th, 2009

Recent Daily News [ see all ]

11/20/2009
11/19/2009
11/18/2009

Charts [ see all ]

European Paper Industry Cuts CO2 Emissions by 42% since 1990

S. America Takes Most Urgent View of Copenhagen Talks

Nike Tops Annual Climate Action Scores

Oceans May Trap more Carbon than Forests

Jobs

View All Jobs >> Post a Job >>

Comments and Discussions

Trade Association on Trade Group on EPA Chemical Regs: ‘If Everything is a Priority, Then Nothing is a Priority’
"Seriously… that..."

Gary Markowitz on Supermarkets Tackle Emissions Reductions, Fuel Efficiency
"Supermarkets waste over 10 percent of their energy through improper..."

peter in ireland on Ontario May Follow California’s Lead on TV Energy Efficiency
"Governor Schwarzenegger is shooting himself in the foot! 1...."

Environmental Leader on S. America Takes Most Urgent View of Copenhagen Talks
"The survey respondents (the PDF report mentions 4,000 respondents in 38..."

Jake on UPS Trying New Hydraulic Hybrid Trucks
"A point of clarification: the Reuters press release referenced herein reports that 20 UPS will purchase..."

Custom Organic Shirts on S. America Takes Most Urgent View of Copenhagen Talks
"90% of North Americans believe it is urgent to get a global climate..."

peter dublin on California City’s Green Building Ordinance Applies to Commercial Buildings
"Why energy efficiebnt regulation on buildings –..."

Environmental Leader