270 Energy:Reduce Office of Fossil Energy Funding

Savings in Millions of Dollars
  • 2016
  • 2017
  • 2018
  • 2019
  • 2020
  • 2021
  • 2022
  • 2023
  • 2024
  • 2025
  • 2016-2020
  • 2016-2025


Savings are expressed as budget authority and were calculated using the CBO baseline and by comparing the FY 2014 spending level to the Heritage-proposed spending level of $222.7 million (increased to $226 for inflation through 2014) as found on page 16 of Nicolas Loris, “Department of Energy Budget Cuts: Time to End the Hidden Green Stimulus,” Heritage Foundation Backgrounder No. 2668, March 26, 2012. The FY 2014 funding level of $562.1 million can be found on page 105 of House of Representatives, 113th Congress, 2nd Session, “Energy and Water Development Appropriations Bill, 2015.”  Both spending levels were increased at the same rate as discretionary spending for 2016–2025, according to the CBO’s most recent August 2014 baseline spending projections. The savings represent the difference between the two policies.


Technical Notes on Scoring

CBO Baseline

Unless otherwise noted, calculations for savings for each recommendation relies on the most recent Congressional Budget Office baseline, as found in “An Update to the Budget and Economic Outlook: 2014 to 2024,” published August 27, 2014, has been used.

Savings “Totals”

While totals for the five and 10 year savings are provided by section and for the complete set of recommendations, there are two reasons they should not be viewed as representing total savings for The Budget Book.

First, as noted in the introduction, The Heritage Foundation would recommend that the savings realized in the Function 050 Defense section would stay within the Department of Defense to strengthen the nation’s defense capabilities.

Second, the numbers cannot be deemed to represent the realized savings if every single recommendation were adopted because policy changes made in one program can impact spending levels in other programs.  Thus, the numbers in the table do not reflect any potential interactions between the various policy changes affecting spending or savings.


Heritage Recommendation:

Reduce funding for the Office of Fossil Energy (FE). This proposal saves $341 million in 2016, and $3.6 billion over 10 years.


America thrives on fossil fuel entrepreneurship & free market competition.

Most of the funding for fossil-energy research and development focuses on technologies that will reduce carbon dioxide emissions and are activities that the private sector should carry out. The FE spends money on a clean-coal power initiative, on fuels and power systems to reduce fossil power plant emissions, innovations for existing plants, integrated gasification combined cycle (IGCC) research, advanced turbines, carbon sequestration, and natural gas technologies. Part of the DOE’s strategic plan is to bring down the cost and increase the scalability of carbon and capture sequestration.

By attempting to force government-developed technologies into the market, the government diminishes the role of the entrepreneur and crowds out private-sector investment. This practice of the government picking winners and losers denies energy technologies the opportunity to compete in the marketplace, which is the only proven way to develop market-viable products. When the government attempts to drive technological commercialization, it circumvents this critical process. Thus, almost without exception, it fails in some way.

Congress should eliminate these programs while keeping the funding necessary to maintain the Strategic Petroleum Reserve (SPR) and Naval Petroleum and Elk Hills School Lands Fund. Congress should explore selling off SPR over time in a way that maintains cooperation under international agreements and meets any relevant national security.

America thrives on fossil fuel entrepreneurship & free market competition.

Contributing Expert

Nicolas (Nick) Loris, an economist, focuses on energy, environmental and regulatory issues as the Herbert and Joyce Morgan fellow at The Heritage Foundation.

See publications by Nicolas Loris

Nicolas (Nick) LorisHerbert and Joyce Morgan Fellow

Heritage Experts

Jack Spencer oversees Heritage Foundation research on a wide range of domestic economic issues as director of the Roe Institute for Economic Policy Studies. Those topics include federal spending, taxes, energy and environment, regulation and retirement savings.

See publications by Jack Spencer

Jack SpencerVice President for the Institute for Economic Freedom and Opportunity

Katie Tubb is a Research Associate and Coordinator in the Thomas A. Roe Institute for Economic Policy Studies

See publications by Katie Tubb

Katie TubbResearch Associate and Coordinator

Additional Reading