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MADISON -- Gov. Jim Doyle is sacrificing one of his signature programs, a multimillion dollar effort to help Wisconsin companies discover new sources of energy, to balance the state budget.
The Legislature’s budget committee cut all $30 million the governor had proposed for the Wisconsin Energy Independence Fund that gives grants and loans to businesses researching and developing clean energy.
Environmental groups and companies who received the program’s first batch of funding last year are upset with the move.
"It’s very disappointing to me as a recipient of one of the grants and somebody who has worked on behalf of Wisconsin and the Midwest to advance this sector," said John Biondi, president of C5-6 Technologies in Middleton, which received a $350,000 grant last year for research to make the production of ethanol more efficient.
But he added he understood the reality of the $6.6 billion budget shortfall and said, "Nobody is probably more disappointed than the governor."
Doyle appeared at the company last year to promote the fund as a central part of his Clean Energy Wisconsin plan to make the state a leader in renewable energy. He called the fund a 10-year, $150 million program that would help explore cutting-edge technologies, relying on the state’s natural resources and manufacturing expertise.
Doyle spokeswoman Carla Vigue said the governor would reluctantly approve the cut. She said federal stimulus money coming to Wisconsin would also help promote renewable energy businesses.
"This is one of the hard choices that have to be made during tough economic times," she said. "The Legislature and the governor have to make hard cuts, including cuts to programs that the governor cares deeply about. This is one of those."
Doyle unveiled the plan during his 2006 re-election campaign as a way to reduce the state’s reliance on foreign oil while creating jobs in Wisconsin.
The first $7.5 million in awards last year went to more than 20 companies, including those researching cleaner sources of gasoline and ethanol, batteries for electric cars, solar power and more.
Doyle toured the state promoting the projects last fall, which he said would leverage $60 million in investment. But that was before the economic downturn slowed Wisconsin tax collections, blowing a hole in the budget.
The Legislature’s Joint Finance Committee voted to transfer the $30 million the governor proposed spending on the program in February - from surcharges that businesses pay for recycling - to the general fund.
The Wisconsin League of Conservation Voters and Wisconsin Environment are urging lawmakers to restore the money before the budget is approved by the Legislature.
"Because it will help create jobs and reduce the costs associated with global warming, it will have great rewards for Wisconsin’s workers and environment," said Anne Sayers, a league lobbyist.
The Doyle administration seems resigned to the cut.
Commerce Secretary Dick Leinenkugel, whose agency administers the fund, said the budget will suspend the program for two years but won’t kill it. In the meantime, he said the state expects to receive $55.5 million from the federal stimulus package to promote "green jobs."
The state plans to use the money to support manufacturers making environmentally-friendly things like solar panels, to help companies get into the supply chain for clean energy technologies and to help businesses reduce costs through energy efficiency and renewable energy.
None of the money is expected to go to research and development, which had been at the heart of the energy fund.
Judy Ziewacz, executive director of Doyle’s Office of Energy Independence, said the stimulus money puts a higher priority on saving and creating jobs immediately than on research. She said the office would help firms seek money for projects through other sources such as the U.S. Department of Energy.
Leinenkugel said one of the most exciting projects backed by the fund involved a $500,000 grant to Johnson Controls-Saft Advanced Power Solutions LLC in Glendale to help develop batteries for Ford Escape hybrid vehicles.
Sayers praised grants that went to companies developing more energy-efficient heating and lighting in commercial buildings and anaerobic digesters that will reduce pollution runoff at dairy farms.
"The fund was helping advance energy technologies that could be a significant part of Wisconsin’s economic future. We are saddened by this decision," said Mary Blanchard, a spokeswoman for Madison-based Virent Energies Inc., which is developing technology to make gasoline with plant sugars instead of petroleum.
Mark Daugherty, president and chief executive officer of SolRayo LLC in Madison, said his company used its $250,000 grant from the fund to open an office and laboratory.
The company is developing an ultra-capacitor to store energy that would be used by utilities to improve the stability of the electric grid to allow for more use of solar and wind power.
"We’re disappointed they had to do that," he said. "At the same time, in these economic times we realize everything is pretty tight."
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