Fossil Fuel Industry Kings of Corporate Welfare

This graphic from GOOD magazine shows who gets the bulk of the enormous US energy subsidies. Many subsidies are hidden and difficult to estimate and this attempt looks to be low according to the experts I’ve interviewed for various articles (cited below). The graphic also doesn’t include subsidies for nuclear which are equally enormous.  — Stephen

The enormous fossil fuel subsidies are rarely acknowledged when complaints are raised about costs of renewable energy. This report shown below says subsidies for fossil fuel are 12X that for green energy but this is a gross underestimate based on the experts I’ve interviewed in June for this article Free Ride for Oil and Coal Industry May Be Over.

Subsidies experts in Switzerland told me that “two-billion-dollars-a-day public subsidy for carbon-based fuels is a very conservative estimate..”

In reality big oil and coal get more like 20X the money green energy. So let’s do some real pricing: electricity from coal 5 cents kWh X 20 for subsidies (not to mention free use of the atmosphere /environment for its CO2, mercury etc waste products.) Corporate welfare at its best.

A few of the many articles I’ve written on the subject of energy subsidies:

Fossil Fuel Subsidies Are 12X (more like 20X) Support for Renewables, Study Shows

Every Day Governments Give an Estimated $2 billion to Oil, Coal & Gas Industry

Oil Companies and Special Interests Spend Half a Billion Dollars to Defeat US Clean Energy – Study

Nuclear Power Costs Skyrocket, Cost of Renewables Plummet

Every Day Governments Give an Estimated $2 billion to Oil, Coal & Gas Industry – I hope You’re Not Hungry or Living on the Street

[Updated May 11 2012: At last a  serious plan to phase out these subsidies will be on the table at the Rio+20 meet in June. I will be following this closely – with your help – Stephen ]

Experts say the subsidy madness must stop. With unemployment high can governments facing recession summon the will to end the fossil fuel industries’ FREE RIDE?

By Stephen Leahy

BERLIN, Jun 29, 2010 (IPS)

Every day, governments give away an estimated two billion dollars of taxpayer money to the fossil fuel industry. This unmatched largesse to a highly profitable sector by countries verging on bankruptcy or unable to feed large numbers of their own people is “complete madness”, according to many experts.

In Toronto Sunday, at the conclusion of G20 summit, countries agreed the madness must be constrained if not stopped.

“I was impressed. I think the commitment to phase out fossil fuel subsidies has finally arrived,” said Mark Halle, director of trade and investment at the International Institute for Sustainable Development (IISD) European office in Geneva.

“With countries committed to cutting their deficits, it is hard to ignore giving billions of real money away to the fossil fuel industry or to keep fuel prices low,” Halle said in an interview.

Title: Offshore Description: Offshore platform...

The two-billion-dollars-a-day public subsidy for carbon- based fuels is a very conservative estimate based on the extensive research conducted by the IISD’s Global Subsidies Initiative, said Halle. Not only do such huge subsidies undermine policies on energy efficiency, they make it impossible for alternative energy sources to compete, he said. [See also Fossil Fuel Subsidies Are 12X (more like 20X) Support for Renewables, Study Shows — Stephen]

We can’t make the transition to low-carbon economies nor can the energy playing field be leveled without the elimination of fossil fuels. And time for that has finally come,” he said.

Others are less optimistic given the G8 and G20 track record for broken promises.

“It (the G20 commitment) fell short of vision and courage that is expected from global leaders in the light of the disastrous oil spill” in the Gulf of Mexico, said Darek Urbaniak of Friends of the Earth Europe. Urbaniak noted that BP, the company responsible for the spill, receives British and EU public subsidies.

Do you find this article interesting? It exists thanks to contributions from readers. Please click here to learn more about Community Supported Journalism. Continue reading