Sunday, June 14, 2015

Elon Musk Subsidies Are Bigger than Fossil Fuels Get | National Review Online

Elon Musk Subsidies Are Bigger than Fossil Fuels Get | National Review Online

Earlier this year, the U.S. Energy Information Administration (EIA) released the most recent data available regarding energy subsidies provided by the federal government. The data, covering the year 2013, broke down total taxpayer subsidies across the different sectors of the energy industry. While fossil fuels did enjoy some government support through various direct expenditures, tax credits, and R&D programs, the data stands in sharp contrast to Musk’s claims.

Data from the EIA report, combined with numbers from an anti-oil advocacy group regarding state-level government support, reveals that total state and federal support for the oil-and-gas industry is no more than $5.5 billion each year. As stated, Musk’s companies combine for $5 billion in subsidies, a number that he has yet to dispute. Clearly, the difference is much smaller than Musk’s outlandish 1,000-to-one claim. Even without this data, Musk’s claims were completely ridiculous from the outset. Does the billionaire whom many regard as a genius not realize that 1,000 times $5 billion is $5 trillion, the equivalent of Japan’s GDP? (He may have had this bogus IMF study in mind.)

Certainly a healthy debate should and does exist about whether taxpayers should be helping oil and gas conglomerates. Arithmetic trouble aside, Musk insinuated that the fossil-fuel industry is the primary beneficiary of energy subsidies. That’s not true either. In fact, according to the EIA, total federal taxpayer support across the renewables sector totaled roughly $15 billion in 2013. The solar sector (Musk’s favorite) alone received about $5.3 billion.

And neither of these figures accounts for the various benefits and mandates that help renewable industries on the state level. No subsidy quite compares to the standards that exist in a plurality of states that force people and utilities to buy renewable electricity. In total, the renewables sector combines for a staggering 72 percent of all federal energy-subsidy dollars. Oil and gas, meanwhile, combine for a mere 4 percent of total federal support. Even throwing in coal adds only another 6 percent.

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