Obama Wants To End Oil Subsidies, Use The Money For Alt-Fuels


obama-alt-fuelsIt’s tax season again, and that means the annual plea from the Obama Administration for eliminating $4 billion in annual federal tax incentives for the oil and natural gas industry.  This year there was an additional request however, earmarking that money for advanced alternative fuel technology research. Does it stand a chance of passing?

Every year around tax season, President Obama asks that the taxpayer subsidies that go to oil and gas companies be repealed. The logic being that since these companies are making record breaking profits, they don’t need subsidies. Seems logical to. In addition to abolishing the subsidies, the President also asked to cut tax credits for oil and gas produced from marginal wells.

Notably different this year was Obama’s request for $2 billion for alternative fuel research projects – with the $2 billion coming directly from royalties from oil and gas development on federal land. The federal land catch is an interesting tactic, as companies are lining up to start drilling on federal lands containing once-unreachable natural gas and oil pockets through fracking.The proposal also included new inspection fees totaling $48 million for onshore oil and gas drilling on federal lands, though obviously some people are wary of opening places like George Washington National Forest to fracking.

Unfortunately, these annual proposals are mostly symbolic in nature. Congress is responsible for writing and passing government spending bills, not the President. Will we ever see the corporate handouts to oil and gas companies ended?

Source: Platts.com | Image: Argonne National Laboratories




About the Author

Andrew Meggison was born in the state of Maine and educated in Massachusetts. Andrew earned a Bachelor's Degree in Government and International Relations from Clark University and a Master's Degree in Political Science from Northeastern University. In his free time Andrew enjoys writing, exploring the great outdoors, a good film, and a creative cocktail. You can follow Andrew on Twitter @AndrewMeggison
  • Lee Thomas

    In the grand scheme of fairness, the new tech should benefit from the advantages the old got but, just ending the oil subsidies is a step in the right direction. I would hate to see asking for alt fuel subsidies scuttle that effort.

    • I’m with you, but just ending the oil and fossil fuel subsidies would be HUGE for ethanol, solar, and wind power. A level playing field is all we should ask for.

  • susannaschick

    it would be a dream come true. it’s sickening that companies with massive profits get subsidies.

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  • danwat1234

    I doubt it’ll happen anytime soon but would be great

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  • Bi-Polar Bear

    America spends far more on corporate subsidies than on all entitlement programs combined. Do not overlook the fact that the US military is largely utilized to protect corporate interests around the globe, even though those costs are never counted as subsidies.

    It always interests me to see the Tea Party folks and small government hacks like Grover Norquist wailing and gnashing their teeth about spending money to help actual people but never, ever met a corporate welfare or military spending program they didn’t like.

    Hypocrisy is rampant upon the land.

    • It’s only rampant because we’re not jailing the Tea Party jags as traitors.

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