WASHINGTON, D.C. — The Obama administration is proposing a $4 billion fund to reward states that exceed cuts in greenhouse-gas emissions, and wants Congress to back steeper royalty rates for oil, gas and coal extraction from public land.
In a mix of measures likely to be greeted skeptically by the Republican majority in Congress, President Barack Obama’s 2016 budget calls for continued tax breaks for wind and solar energy, investments in Appalachian communities facing a steep drop in coal-industry employment and $1.29 billion in aid to developing nations to help them fight climate change.
“Cutting carbon pollution is essential to reducing the threat of climate change and represents one of the greatest economic opportunities of the 21st century,” according to the budget document released Monday.
Obama has stepped up efforts to combat climate change since his 2012 re-election, with the Environmental Protection Agency moving ahead with the first caps on carbon emissions from power plants. Those rules, set to be finalized this year, have drawn the ire of Republicans such as Senate Majority Leader Mitch McConnell, who say one of their top priorities is blocking those plans.
McConnell says he worries about the pain those climate policies inflict on coal-dependent communities in Kentucky and elsewhere in Appalachia. Obama sought to address those concerns, too, proposing a fund to pay miners put out of work as coal demand slumps, and to help shore up pension benefits. He would also funnel $1 billion over five years to help refurbish abandoned coal-mining sites.
The plan is a “hopeful sign that brings with it much opportunity for coalfield communities,” Justin Maxson, president of Mountain Association for Community Economic Development in Kentucky, said in an e-mail. It “is a major boost to regional economic transition initiatives already taking place.”
Obama separately called for $239 million for the EPA’s climate plans, including $25 million to help states write plans to meet the standards. In addition, the administration proposed a $4 billion fund to induce states to move more quickly or cut more steeply than required under the EPA plan.
The Treasury budget also proposes to make permanent an investment tax credit for solar, wind and fuel cells, and to establish a new $2 billion tax credit for power plants that capture their carbon dioxide, with a bonus $50 credit for every metric ton of carbon dioxide permanently stored underground.
The budget would also increase spending on carbon capture and storage technology programs run by the Energy Department. The agency is requesting more than $116.6 million for its programs, an increase of 32.5 percent from this year’s level. A carbon storage program would get almost $109 million under the budget request, an increase of about 9 percent.
Coal research programs in general, though, would be cut about 7.7 percent, to a bit more than $369 million from $400 million.
Obama is proposing an additional $500 million for the Green Climate Fund, to meet a $3 billion pledge he made last year. That United Nations fund is seen as one key to getting a global agreement in Paris this year to cut greenhouse gases, and Republican lawmakers had already expressed skepticism toward approving the funds before it was put in the budget.
The Interior Department said it would renew a plea to Congress to raise royalty rates on oil and gas leases on public lands. The change would raise $2.5 billion over the next 10 years, according to the budget.
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