President Obama seeks $2 billion in research on cleaner fuels

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WASHINGTON -- With few options available for financing his clean-energy ambitions, President Barack Obama on Friday proposed diverting $2 billion from federal oil and gas lease revenues over the next decade to pay for research on advanced vehicles.

Mr. Obama visited the Argonne National Laboratory near Chicago to tour its state-of-the-art research facilities and promote his idea, first proposed in last month's State of the Union address, to use oil and gas money to find ways to replace hydrocarbons as the primary fuel for the nation's cars, trucks and buses.

The idea enjoys some bipartisan and business support, but is likely to encounter strong resistance from congressional Republicans, who will portray it as a tax on energy producers. The White House says the money will come from growth in drilling revenue from leases on public lands and waters over the next decade, and is not a new tax.

Mr. Obama presented the proposal as part of his "all-of-the-above energy strategy," which includes an increase in oil and gas development; support for nonpolluting sources such as wind, solar and geothermal energy; loan guarantees for new nuclear plants; and research into long-term alternatives to fossil fuels.

Mr. Obama has given up on moving comprehensive climate change legislation through Congress and has ruled out a carbon tax to finance development of alternative energy sources, so he is pursuing smaller-scale projects that do not require new sources of revenue. The Energy Security Trust, as he calls his shift of oil and gas royalties to alternative energy research, is one.

Mr. Obama came to office with grand ambitions of remaking the nation's energy economy and tackling climate change. His stimulus package included $90 billion for clean-energy research, but most of that money is gone, and Congress is unlikely to finance such work at anything like those levels in the future.

The Argonne National Laboratory, which has conducted groundbreaking research in vehicle battery technology that helped jump-start the U.S. electric car industry, received a large chunk of the stimulus money. Now, it is facing reductions under mandatory budget cuts known as the sequester.

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