What Could Society Do With $757 Billion Annually to Save Earth?
Last month, Forbes reported on the Environmental and Energy Study Institute’s report on subsidies to the fossil fuel industry, and spoiler alert: oil and gas subsidies are expanding, not shrinking! EESI estimates that oil and gas subsidies amount to $757 billion, which costs the government a net loss of $2.1 billion more than the federal revenue from oil and gas production. As recently as 2016, the government was seeing a net gain of $1.1 billion.
Part of what makes these subsidies tricky to measure is that many of them are implicit, meaning that, rather than forking over money, the government spares fossil fuel companies from bearing the costs of environmental degradation and the human health problems resulting from pollution. Instead, those costs are borne by Americans.
In January, Congress passed a temporary appropriations bill to fund the government through early March. That means that this month, passing the rest of the budget should be their highest priority. President Biden, in his budget request last March, scolded fossil fuel companies for spending their record profits on stock buybacks instead of investing in production, which would have reduced gas prices.
Biden proposed removing 13 existing fossil fuel tax preferences and credits, which he estimates will save the federal government $31 billion over the next decade, and proposed changing tax law for income from foreign oil and gas production, which EESI estimates will save the federal government an additional $66 billion. That’s $97 billion in savings.
Just in time to make a major push to invest more in green energy. The cost of green energy has plummeted over the past decade—according to the World Economic Forum, solar fell by 89% and wind by 70% from 2010-2020. And it’s projected to keep falling!
Getting Congress to rescind oil and gas subsidies is a hugely challenging task. What can you do?
Write! Contact President Biden and members of Congress to urge them to eliminate subsidies to hugely profitable fossil fuel companies who have already demonstrated that they’ll spend the money on stock buybacks. Of the 13 tax preferences and credits he’s proposed eliminating, the biggest ones are the tax credit for percentage depletion and expensing intangible drilling costs. You can also write to support HR 1483 or HR 1743, both of which get rid of fossil fuel subsidies.
Vote! Illinois’s Primary Election is on March 19, which means our representatives in the House of Representatives are up for election. Where do the candidates stand on fossil fuel subsidies and other environmental issues? How do they plan to tackle climate change?
Email the Environmental Action Committee at environment@lwvchicago.org with questions.