New objectively balanced observation-based reconstructions of global and continental energy budgets and their seasonal variability are presented that span the golden decade of Earth-observing satellites at the start of the twenty-first century. In the absence of balance constraints, various combinations of modern flux datasets reveal that current estimates of net radiation into Earth’s surface exceed corresponding turbulent heat fluxes by 13–24 W m−2. The largest imbalances occur over oceanic regions where the component algorithms operate independent of closure constraints. Recent uncertainty assessments suggest that these imbalances fall within anticipated error bounds for each dataset, but the systematic nature of required adjustments across different regions confirm the existence of biases in the component fluxes. To reintroduce energy and water cycle closure information lost in the development of independent flux datasets, a variational method is introduced that explicitly accounts for the relative accuracies in all component fluxes. Applying the technique to a 10-yr record of satellite observations yields new energy budget estimates that simultaneously satisfy all energy and water cycle balance constraints. Globally, 180 W m−2 of atmospheric longwave cooling is balanced by 74 W m−2 of shortwave absorption and 106 W m−2 of latent and sensible heat release. At the surface, 106 W m−2 of downwelling radiation is balanced by turbulent heat transfer to within a residual heat flux into the oceans of 0.45 W m−2, consistent with recent observations of changes in ocean heat content. Annual mean energy budgets and their seasonal cycles for each of seven continents and nine ocean basins are also presented.