Trump’s Budget – What to Expect in Energy

United States President Donald Trump released his 2027 national budget proposal in April, signaling major changes across several sectors. In addition to outlining $1.5 trillion in military spending, the largest figure in recent history, Trump recommends around a 10% decrease of non-defense spending, or $660 billion, in the 2027 fiscal year, which is expected to hit the education sector hard, as well as agencies such as the Environmental Protection Agency. 

The shift in spending focus reflects the current geopolitical situation, with the ongoing conflict in the Middle East. The Republican-controlled Congress will need to decide which parts of the budget will be passed into law by October 1. 

What the Budget Means for U.S. Energy

When it comes to energy, Trump’s proposed budget aims to make more sweeping cuts to climate programs. Trump stated, in the budget proposal:

“The era of wasting taxpayer dollars on unreliable, expensive energy that is dependent on foreign supply chains is over. The U.S. Government will no longer subsidize intermittent energy forms that destabilize the grid or Green New Scam projects that increase consumer costs and promote radical leftist policies.” 

“Instead, the Budget pushes an aggressive America First agenda that would combat foreign influence through robust domestic critical material supply chains, as well as revitalize the Nation’s Strategic Petroleum Reserve (SPR) as a valuable national energy asset.”

Trump proposes giving $53.9 billion to the DoE, marking a 10% increase on 2026, with $32.8 billion to be allocated to the National Nuclear Security Administration (NNSA), a 12% increase on the previous year.  The remaining $21.1 billion reflects a 11% decrease from 2026 spending, which it will achieve, Trump says, “by slashing Green New Scam initiatives and rooting out woke diversity, equity, and inclusion (DEI) programs.”

Budget Highlights for the Energy Sector

President Trump’s budget proposes the following for the energy sector:

Investments:

• Bolstering Energy Dominance (+$4.7 billion) – This includes $3.5 billion to rapidly deploy from baseload power [meaning technologies such as natural gas, coal, and nuclear power]
• Strengthening Nuclear Security (+$3.6 billion). 
• Driving Domestic Critical Minerals Production (+$394 million). 
• Refilling the SPR (strategic petroleum reserve) (+$89 million). 
• Increasing Energy-Water Security (+$75 million) – A joint DoE-National Science Foundation effort with $75 million at DoE and a companion $100 million at NSF focused on drought-prone basins and energy-intensive regions.

Program Cuts and Eliminations:

• Cancelling Green New Scam IIJA (Bipartisan Infrastructure Law) Funding (–$15.2 billion). 
• Reduces Funding for Energy Efficiency and Renewable Energy (EERE) Programs – the DoE abolished the EERE office in 2026. 
• Environmental Management (–$386 million). 
• Government-Wide Prohibition on Publishing and Subscription Fees – the budget prohibits the use of Federal funds for expensive subscriptions to academic journals and prohibitively high publishing costs unless required by Federal statute or approved in advance by a federal agency. 

Trump also speaks favorably about the role of artificial intelligence (AI) in the future of the energy sector, with a $1.2 billion commitment from the DoE to AI. 

Further Climate Spending Cuts

Over the last year, President Trump has cut vast quantities of climate funding, as he seeks to reverse much of the green transition efforts that took place under the Biden administration. However, Congress has pushed back on some of these efforts, meaning that some climate programs have remained.

The 2027 budget proposal aims to cut funding from several remaining programs and further hinder renewable energy capacity development. 

Some of the proposed cuts to climate spending include:

• Cutting $1.1 billion in spending for climate change research under the DoE’s Office of Science
• Canceling $150 million in DoE studies on certain technologies, such as electric vehicles and direct air capture systems
• Ending $45 million of U.S. Department of the Interior renewable energy programs, with a focus on offshore wind
• Eliminating $1.6 billion for the National Oceanic and Atmospheric Administration
• Cutting $204.5 million from the U.S. Treasury Department’s community development financial institutions fund, which uses federal and private funds to support economically disadvantaged areas. 

Senate minority leader Chuck Schumer said that the proposed budget cuts would mean “massive reductions” to energy affordability. Schumer stressed that Democrats would fight “tooth and nail” to prevent the budget from becoming law.

The National Energy Assistance Directors Association echoed this sentiment, saying that eliminating the low-income home energy assistance program “would deepen the nation’s energy affordability crisis and leave millions of vulnerable households without the assistance they need.” 

If President Trump’s proposed budget is voted into law, it will primarily support the oil, gas, coal and nuclear power sectors, while reducing support for renewable energy and cleantech. By cutting funding for climate efforts, Trump is doubling down on his first-year energy policies and prioritizing fossil fuels. The passing of the budget would lessen energy diversification efforts for the next year, which could ultimately leave the United States more vulnerable to the volatile pricing of global oil and gas, as is currently being seen.

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