The FY22 President’s Budget, as told by Carbon180

Carbon removal can be found throughout the budget, and we’ve got an agency-by-agency breakdown

by Giana Amador, policy director

Our team has been busy parsing through the pages of the FY22 budget and justifications, identifying funding for carbon removal across federal agencies. From here, Congress will choose how to fulfill this budget through the appropriations process. The budget is ambitious and showcases the role carbon removal can play in the climate fight. One big thing? Carbon removal has a dedicated budget line at the Department of Energy — the first time it’s been called out at this level. Beyond that, there are increases in funding for a range of carbon removal approaches across agencies.

For the Biden administration, this budget not only signals a commitment to explore and scale carbon removal but a larger reorientation of US interests toward climate action and environmental justice. It has taken years to steer the ship this way — Congressional action, international pressure, and grassroots movements have all helped to point us in the right direction. The budget does the same: it coordinates and directs federal agencies around climate in a way we’ve never seen before. It’s a continuation of Biden’s early action on climate, from the Biden administration, from net-zero electricity commitments to progressive appointments and a climate-forward American Jobs Plan.

Congress has also demonstrated its leadership on carbon removal, authorizing and appropriating hundreds of millions of dollars in dedicated funding over the past two years. In the upcoming appropriations process, it will be important for Congress to enact ambitious levels of funding in line — and even beyond — this budget request.

Broken down by agency, here are the core ways carbon removal appears in President Biden’s FY22 Budget Request.

Department of Energy:

We’re continuing to see the Department of Energy (DOE) focus on carbon removal. Notably, the FY22 budget renames the Office of Fossil Energy (FE) to the Office of Fossil Energy and Carbon Management (FECM), stating:

“To meet these challenges, the Budget re-focuses funding from traditional fossil combustion-centric activities (Advanced Energy Systems and Cross-cutting Research) to climate-centric activities (Carbon Capture, Utilization and Storage).”

This is a big deal. While carbon capture and removal are expected to play a critical role in decarbonization, FE has not historically oriented its activities around meeting climate goals. Before this budget, most carbon capture work at FE was focused on coal-power applications.

An even bigger deal? The dedicated budget line for carbon dioxide removal. This new line comes from the Energy Act of 2020, passed at the end of last year with bipartisan support.

Beyond these wins, there are increases in funding across the Carbon Capture, Carbon Utilization, and Carbon Storage programs with callouts for industrial applications — a sector where carbon capture is expected to play an integral role in emissions reductions. The budget also suggests moving away from funding non-climate projects, such as transformational coal pilots.

Key programs and associated funding increases include:

Office of Fossil Energy and Carbon Management: $890,000,000 (+$140,000,000)

  • Carbon Dioxide Removal: $63,000,000 (+$63,000,000)
  • Carbon Capture: $150,000,000 (+$23,700,000)
  • Carbon Storage: $117,000,000 (+$38,000,000)
  • Carbon Utilization: $38,000,000 (+$15,000,000)

These funding increases across DOE are critical for scaling carbon removal technologies: RD&D will drive down costs for existing solutions and spur the development of new and innovative approaches.

Department of Agriculture:

We’re seeing a significant shift towards climate priorities in the ag and forestry sectors. For one, at the Office of the Chief Economist there is additional funding to coordinate climate change work across the agency (Carbon180 has called for this kind of improved coordination in our recent report). The USDA Climate Hubs also received dedicated funding for the first time, securing $40 million to support producer adaptation to climate impacts. There is also a ramp-up of agriculture climate research, with $92 million for the Agriculture Research Service (ARS), $4 million for the Economic Research Service, and $265 million for the National Food and Agriculture Institute (NIFA) Agriculture and Food Research Initiative (AFRI). Notably, there were new callouts to soil carbon sequestration across programs focused on research, data collection and modeling, and implementation.

In particular, the Natural Resources Conservation Service (NRCS) Conservation Technical Assistance (CTA) program and NIFA’s Sustainable Agriculture Research and Education (SARE) program, two vital tools to support producers in operationalizing soil carbon practices, saw significant funding increases. CTA is also charged with conducting a second Rapid Carbon Assessment which would estimate current US soil carbon stocks and support the development of soil carbon models to draw a tighter connection between conservation practices and carbon outcomes. Under the NRCS, there is also a $5 million increase for the Soil Surveys program and a focus on the development of critical database infrastructure to house numerous sources of soil carbon data. Similarly, there is an increase for the ARS Long-term Agroecosystem Research Network (LTAR) to increase the adoption of climate-smart practices and producer participation in carbon markets, among other priorities.

Altogether, we are seeing significant investment from the Biden administration in strengthening the scientific understanding of soil carbon sequestration in a way that reflects the diversity of US agricultural operations, realities that producers face during practice adoption, and the urgency of the climate crisis.

Key programs and associated funding levels include:

Office of the Chief Economist: $31,100,000 (+6,858,000)

  • $6,500,000 for climate change work, including coordination across the agency

ARS: $1,849,590,000 (+$357,806,000)

  • $192,000,000 for climate change activities, including:
    —– $92,000,000 for climate science, names carbon sequestration as a priority across all ARS programs, with dedicated funding for soil carbon under the Crop Production Program and Environmental Stewardship Program
    –––––– LTAR: $15,600,000
    —– $95,000,000 for ARPA-C research

ERS: $90,594,000 (+$5,118,000)

  • $4,000,000 for climate science, including additional data collection to better inform the role of conservation practices in soil health and carbon sequestration potential

NIFA: $1,955,863,000

  • Sustainable Agriculture Research and Education: $60,000,000 (+20,000,000)
  • AFRI: $700,000,000
    —– Sustainable Agriculture Systems: $175,000,000 with an emphasis on climate-smart agriculture, carbon sequestration, and clean energy

NRCS — Conservation Operations: $886,000,000 (+$53,558,000)

  • Conservation Technical Assistance: $774,000,000 (+$42,558,000, with $4,000,000 for a second RCA)
  • Soil Surveys: $84,000,000 (+$5,000,000)
  • Plant Material Centers Program: $12,000,000 (+$2,000,000 for plant science and field trials related to carbon sequestration among other priorities)

On the forestry front, the administration is placing a similar emphasis on climate change, funding programs that together provide a holistic approach to forestry, in order to reduce wildfire risk, improve ecosystem resilience, and increase carbon sequestration through forest management, protection, and reforestation. Specifically, the increased funding for the Collaborative Forest Landscape Restoration Fund program to $80 million signals interest in addressing the backlog of restoration projects in a way that brings communities, local governments, and federal staff together.

However, these plans rely on tools and resources provided by the Forest Inventory and Analysis (FIA) program of the US Forest Service and funding levels for the FIA could be more ambitious. Given the importance of embedding environmental justice within climate action, there is an opportunity to address low canopy cover in underserved communities by increasing funding for Urban and Community forestry programs.

Key programs and associated funding levels include:

Note: USFS has shifted to a new budget structure, authorized by Congress, to provide greater financial accountability and operational transparency. This change is reflected in funding levels after FY21.

USFS — Forest and Rangeland Research: $313,560,000 (+$47,560,000)

  • $37,000,000 for climate-focused research on reforestation, carbon sequestration, and carbon accounting
  • $6,000,000 for applied science to improve forest conditions & develop innovations in deep wood products/markets (+$6,000,000)
  • Forest Inventory Analysis: $17,621,000 (no change from FY21)

USFS — National Forest System — Collaborative Forest Landscape Restoration Fund: $80,000,000 (+$66,213,000)

USFS — National Forest System — Vegetation and Watershed Management: $98,470,000 (+$69,787,000)

USFS — State and Private Forestry

  • Urban and Community Forestry: $31,900,000 (no change from FY21)
  • Forest Health Management: $59,200,000 (+$12,968,000)

The President’s Budget sends an important signal that this administration will prioritize carbon removal across agencies. We look forward to working with Congress to act on this request through the appropriations process and supporting the deployment of carbon removal through new policy mechanisms. This nascent industry has the potential to remove billions of tons of carbon dioxide from the atmosphere — but federal policy support is critical to get the carbon removal field off the ground to meet our climate goals.

To review Carbon180’s appropriations requests, please click here.

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