Obama has proposed cutting funds for the Low Income Home Energy Assistance Program by $2.5 billion.

The Jackson Citizen Patriot reports that this would mean $120 million less to keep the heat on in Michigan.

LIHEAP funding is distributed to each state to assist low-income families with energy costs. In Michigan, the funding is used for state emergency relief, home heating credit and weatherization assistance.

In Jackson County, 850 households received state emergency relief funds in June, with payments averaging about $306, according to the state Department of Human Services. It is a crisis intervention program and provides payment for heating fuel, electricity, home repairs and more.

Community Action Agency received about $260,000 in LIHEAP funding this year to provide deliverable fuels such as propane and wood to about 300 clients in Jackson, Lenawee and Hillsdale counties.

Michigan’s Democratic Senators Debbie Stabenow and Carl Levin and Governor Rick Snyder oppose the cuts.

With President Obama playing a cameo role in a recurring TV ad sponsored by American Coalition for Clean Coal Electricity (ACCE), you may be wondering just what the administration’s priorities are for energy innovation. Rest assured, under the stimulus bill passed by Congress, “clean coal” research will get less than a quarter as much federal money as energy efficiency, conservation and renewables, according to Department of Energy figures released last week.

With the announcement of $3.2 billion in block grants for local governments to spend on energy efficiency and conservation, the total stimulus spending on energy is now clear, notes Lane Burt of the National Resources Defense Council. Efficiency and renewable energy — including assistance to low-income homeowners, grants to state and local governments, federal office building improvements, and support for advanced battery manufacturers — will receive a total of $16.8 billion in the next two years while fossil energy research and development will receive $3.4 billion. That’s more than green crusaders like Al Gore  (“Clean coal’s like healthy cigarettes”) would like, but far from a top priority.

Following yesterday’s revelation that cap-and-trade legislation would not be included in the fiscal year 2010 budget, Energy Secretary Steven Chu and Vice President Joe Biden today rolled out a $3.2 billion program to improve efficiency at the state and local level.

The Energy Efficiency and Conservation Block Grant (EECBG) Program commits $1.9 billion to cities and counties and $770 million to states and territories for “energy audits and energy efficiency retrofits in residential and commercial buildings, the development and implementation of advanced building codes and inspections, and the creation of financial incentive programs for energy efficiency improvements,” according to a White House press release. An additional $456 million will be available for local efficiency project bids at a later date.

These measures come on the heels of an even larger $8 billion weatherization program, announced exactly two weeks ago.

Energy efficiency is being enacted much more quickly than the administration’s other environmental goals, in large part because it costs comparatively little and is simpler to implement.

“The funding will be used for the cheapest, cleanest and most reliable energy technologies we have – energy efficiency and conservation – which can be deployed immediately,” Chu explained.

A full description of the EECBG program can be found on the Department of Energy Website.

The plan has two components: the $5 billion Weatherization Assistance Program and the $3 billion State Energy Program. The former will provide up to $6,500 in energy efficiency upgrades for households with income up to twice the federal poverty level (or a bit more in Alaska and Hawaii, presumably because of higher energy costs there). The latter will fund rebates for families that undertake upgrades on their own, as well as state and local efficiency programs.

The first installment of the investments — to the tune of $780 million — will be released in the next few days, with the remainder slowly becoming available as states demonstrate the effectiveness of their efforts.

According to Chu, these programs are a central piece of the administration’s broader energy efficiency goals. “Even as we seize the enormous potential of clean energy sources like wind and solar, the American Recovery and Reinvestment Act makes a major investment in energy efficiency, which is the most cost effective route to energy independence,” Chu said.

The White House estimates that weatherization will reduce the average low-income household’s heating bills by 32 percent, in addition to other energy savings.