Trump Team Proposes Ending Clean Energy Office, Cutting Billions

(Bloomberg) -- The US Energy Department is proposing to shut down its Office of Clean Energy Demonstrations and cut some $9 billion in awards for programs regarding carbon capture, direct air capture, solar and hydrogen, according to documents seen by Bloomberg. 

Under the plan, which isn’t final, the $27 billion agency’s staff would be reduced to 35 employees, and about $10 billion in projects, including $3 billion for so-called hydrogen hubs, would be kept “as is” and transferred to other parts of the Energy Department.

The office employed about 250 people before President Donald Trump, a climate change skeptic, returned to office. 

A decision on the fate of the agency, which was created in 2021 in bipartisan infrastructure legislation, could come as soon as next week, according to Axios, which earlier reported on the proposal. 

Earlier: Amazon, Exxon Hydrogen Hubs Get Slice of $7 Billion US Funds

The Energy Department didn’t immediately respond to a request for comment on Friday evening.

Money for hydrogen hubs, in which the gas can both be produced and used, is intended to highlight its potential as carbon-free fuel to run factories and power plants. Direct air capture involves technology that sucks planet-warming carbon dioxide out of the air.

Among the funding identified for potential elimination are billions of dollars for hubs in California, the Pacific Northwest, the Mid-Atlantic and the Midwest while hubs in Texas, Appalachia, and the Minnesota, North and South Dakota would be spared, according to the documents. The plan also recommends keeping $3.5 billion for advanced nuclear reactor projects and $1.9 billion in industrial demonstration program projects.

Also slated for termination are carbon capture projects, battery storage projects, and a direct air capture project by a subsidiary of Occidental Petroleum Corp. that was selected for an award of as much as $1.2 billion by the Biden administration in 2023. 

The plan comes as the Energy Department, which has a broad mission ranging from overseeing the nation’s emergency reserves of oil to protecting the power grid from cyber threats, has identified 8,500 jobs as “non-essential” as it prepares to cut employees in response to a mandate from Elon Musk’s government efficiency team. 

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