Arizona Eagletarian

Arizona Eagletarian

Tuesday, July 15, 2014

Why can't Oil and Gas compete with renewable energy sources without MASSIVE gov't subsidies?

Less than a month ago, I learned that coal-fired electrical power generating facilities get generous Arizona state tax breaks allowing the IOUs (investor owned utilities) which use it to get a competitive advantage over WIND and SOLAR.

Today, Huffington Post reported that despite repeated Obama administration calls for cutting subsidies to oil and gas producers, Congress has failed to act.

WASHINGTON – Over the past five years, the Obama administration has repeatedly called for cutting fossil fuel subsidies in the form of tax breaks and other incentives. But the amount of money the federal government forfeits through subsidies has increased steadily over that time period, reaching $18.5 billion last year, according to a new report from the environmental group Oil Change International.
That total is up from $12.7 billion in 2009, largely because oil and gas production has increased in the United States. Next year, domestic oil production is expected to reach the highest level since 1972. The Obama administration regularly touts its "all of the above" energy strategy, which includes increased oil and gas production.
The Oil Change report includes a variety of subsidies in its accounting, including tax breaks, incentives for production on federal lands (such as royalty fees that haven't been adjusted in 25 years) and tax deductions for clean-up costs. And if state subsidies for oil, gas and coal production are also included, the total value climbs to $21.6 billion for 2013. 
The story and the report from Oil Change International cite this situation as,
"We're spending more taxpayer dollars every year to fund fossil fuels that we can't afford to burn, according to climate science," said Steve Kretzmann, executive director of Oil Change International.
The situation appears to me to be a gigantic (tax) money laundering or kickback scheme whereby Members of Congress benefit from the subsidies they write into federal law for the oil and gas companies. The fossil fuel industry corporations then turn a percentage of those subsidies around and give them to those supportive Congressional representatives in the form of junkets and campaign donations.

For those enterprising enough to specifically identify that money laundering path, I offer this link to a Follow the Money handbook available on

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