Yesterday legislation dubbed the “End Polluter Welfare Act” was announced in Congress by Senator Bernie Sanders (D-VT) and U.S. Representative Keith Ellison (D-MN). The bill will put an end to as much as $113 billion in taxpayer subsidies from which oil, gas and coal companies would otherwise benefit in the coming decade. The money will instead go towards green energy investment, while ending such loopholes as allowing oil companies to deduct the costs they incur cleaning up their own spills and other environmental damage.
This round of legislation goes above and beyond previous attempts by the Obama administration and more recently, by Senator Robert Menendez (D-NJ). Previous attempts only targeted large oil companies and reached a maximum rollback of subsidies totaling $6 billion to $24 billion. But in an era where the largest oil companies generate $300 million of revenues daily, the bill put forth by Sanders and Ellison is far more aggressive towards ending giveaways to the energy industry.
Under the proposed legislation, one deduction entitled the “tangible drilling deduction” eliminates $14 billion over the next 10 years. The bill would would end the $12 billion in deductions that allow fossil fuel manufacturers to claim that they are manufacturers. An additional $6.8 billion closes the loophole that allows companies like BP to deduct money they spend on the cleanup of oil spills. Finally, in a nod towards the clean energy sector, $2.4 billion would stop fossil fuel companies though investing in “Master Limited Partnerships,” an option currently unavailable to renewable energy companies. The federal Office of Fossil Energy would close too.
According to Senator Sanders’ office, the five largest oil companies in the U.S. earned $1 trillion in profits the past 10 years, but some corporations including ExxonMobil and Chevron paid none or very little in taxes. The End Polluter Welfare Act is an attempt to level the playing fuel in an era where energy costs are rising and climate change is of growing concern. The bill, however, faces almost no chance of passing the Republican-dominated House and would face a filibuster in the Senate.