FY24 Budget Outlook: DOE Applied Energy R&D
The Infrastructure Investment and Jobs Act
The Biden administration has sought to complement the influx of funding from the laws with increases in the annual appropriations for DOE’s various energy R&D programs. Those efforts were partly successful
The administration’s request is detailed in DOE’s budget justification,

Chart of appropriations proposals for DOE applied energy R&D offices
Nuclear energy
The administration has proposed to roll back the Office of Nuclear Energy’s budget from $1.77 billion to $1.56 billion. The Senate proposal would make a marginally larger cut, but the House proposal would provide a small increase to $1.78 billion. The office received some of its annual funding through a special budgetary supplement last year, which all proposals this year would incorporate back into its base budget.
Small modular reactors. The administration’s and Senate’s proposed cuts for the office are mostly linked to a planned reduction from $165 million to $20 million for SMR R&D and deployment activities. However, the House proposal would both maintain that budget at $150 million and reassign $1.20 billion from the Civil Nuclear Credit Program over the next three fiscal years to “ongoing demonstration activities.” The credit program was created by the infrastructure law with a total budget of $6 billion to subsidize existing nuclear plants that might otherwise be shut down, but much of the funding remains unobligated. While the House proposal does not designate specific activities to fund, DOE announced
Advanced reactor demonstrations. In fiscal year 2024, the infrastructure law will allocate the third of four installments of the $2.48 billion it is providing for the Advanced Reactor Demonstration Program. That money is supporting two commercial demonstrations of non-traditional nuclear plant designs: one that the company TerraPower is building
Advanced reactor development. The Senate proposal meets the administration’s request for a steady $120 million budget for five smaller-scale advanced reactor projects,
Nuclear fuel availability. Many advanced reactor designs will employ high-assay low-enriched uranium (HALEU) fuel, which is fuel that can be composed of up to 20% of the highly fissile U-235 isotope. However, domestic commercial HALEU supplies are not yet established and the only large-scale alternative is Russian supplies, which have become untenable following that country’s invasion of Ukraine. These circumstances have already led TerraPower to delay the scheduled opening
Carbon management and decarbonization
There is not a deep divergence in views over the Office of Fossil Energy and Carbon Management budget. The administration is proposing an increase from $890 million to $905 million and the Senate and House proposals would respectively provide $892 million and $858 million. However, that budget is currently eclipsed by the funding the infrastructure law is providing for carbon management projects ranging from design activities to commercial demonstrations of unprecedented scale.
Atmospheric carbon dioxide removal. Last month, DOE selected two projects
Carbon capture from point sources. The infrastructure law is providing about $3.5 billion for commercial-scale demonstrations and large-scale pilot projects to capture carbon from point sources such as power plants. DOE has already awarded $189 million for nine front-end engineering and design studies,
Carbon storage, utilization, and transport. The infrastructure law is providing $2.5 billion for validation and testing projects in carbon storage. In May, DOE selected
Industrial decarbonization. Together, the infrastructure law and the Inflation Reduction Act are providing $6.3 billion for demonstration projects to reduce carbon emissions in energy-intensive, difficult-to-decarbonize industries. A solicitation of proposals for almost all of that funding closed last month and DOE plans to select
Within the Office of Energy Efficiency and Renewable Energy, the administration seeks to increase the annual budget of the Industrial Efficiency and Decarbonization program from $267 million to $394 million, but the House and Senate proposals would only provide $235 million and $275 million, respectively.
Hydrogen. Hydrogen has long been developed as a clean fuel, as in hydrogen fuel cells, and burning hydrogen is regarded as a potential replacement for carbon-emitting heating processes in difficult-to-decarbonize industries. However, hydrogen is itself generally produced using carbon-intensive processes. DOE is currently evaluating proposals for regional “clean hydrogen hubs,” with the aim of selecting between six and 10 that will together receive $7 billion of the $8 billion the infrastructure law is providing for that purpose. The department received 79 preliminary applications in a first round of review and encouraged 33 to submit full applications. The organization Resources for the Future is tracking
Hydrogen technology R&D is also supported across a number of DOE programs. The administration is proposing to trim overall annual funding
Energy storage

Energy Secretary Jennifer Granholm speaks at a White House event in October 2022 announcing $2.8 billion in funding to support electric vehicle battery production.
(Cameron Smith / The White House)
DOE has just selected
Renewable energy
The administration sought significant budget increases across-the-board for programs covering renewable energy, clean vehicle, and energy-efficient building and manufacturing technologies. However, neither the House nor the Senate proposal would support budgets on the scales envisioned.
Wind energy. The administration advanced a particularly ambitious proposal for DOE’s wind energy program, seeking to nearly triple its budget to $385 million. The bulk of the additional funding would go to activities related to expanding offshore wind energy, though there would also be major increases for land-based wind energy and systems integration. While the Senate proposal would partially meet that request with $231 million, the House proposal would cut the budget from $132 million to $113 million. Outside the program’s ordinary budget, DOE just selected projects
Geothermal energy. The administration also aimed for a large increase for DOE’s geothermal energy program, from $118 million to $216 million. Most of the additional money would go to improving enhanced geothermal systems, which involve heating a fluid by pumping it through high-temperature rock deep beneath the Earth’s surface. However, the Senate and House proposals both call for a flat budget. DOE is also currently evaluating applications in the first of an expected four rounds
Water power. The administration is seeking a more modest increase for DOE’s water power program, from $179 million to $230 million. The Senate proposal includes $200 million while the House proposal would cut funding to $155 million. DOE is also evaluating proposals for $45 million in awards for tidal and river current energy technology projects that will draw from the $70 million the infrastructure law is providing for marine energy R&D and demonstrations. The law is also providing $40 million for national marine energy centers and $36 million for hydropower R&D and demonstrations.
Solar energy. The administration wants to increase the solar energy program budget from $318 million to $379 million, but the Senate proposal calls for flat funding, while the House proposal would cut the budget to $288 million. The infrastructure law is providing $80 million for solar energy projects, covering technology R&D, recycling R&D, manufacturing improvements, and workforce development.
Advanced Research Projects Agency–Energy
The administration proposed to increase the ARPA–E budget from $470 million to $650 million, but the House proposal is for flat funding and the Senate proposal would make a cut to $450 million. ARPA–E accords a high degree of independence to its program managers to fund high-risk, early-stage projects across energy technology areas. The administration has aimed to expand application of the “ARPA” model to projects focused on climate change resilience, first through a new agency and now by expanding APRA–E, but the idea has yet to gain backing from Congress.