How Much Tax Money Goes to Fossil Energy Companies

Q:just how much of our tax money is going to ExxonMobil, Massey, etc.? With the new deficit hawks in Congress going after insignificant items like bottled water expenses, you'd think they'd want to know the size of the really wasteful stuff, right?

A:There have been counts, ranging from $10 billion a year by the Environmental Law Institute, to the more comprehensive, $52 billion a year by Doug Koplow of EarthTrack. But, do taxpayers even have a widely accepted, comprehensive inventory of how of our money is being handed to the dirty energy lobby by politicians?  That includes state-level subsidies, by the way, such as the $45 million that Virginia gives to the coal industry

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Why We Still Don't Know How Much Money Goes to Fossil Energy

By Mike Casey   |   February 16, 2011  

The national conversation about wasteful welfare for highly profitable dirty energy corporations has gone from the dramatic statement by the Chief Economist of the International Energy Agency that fossil fuel subsidies are one of the biggest impediments to global economic recovery ("the appendicitis of the global energy system which needs to be removed for a healthy, sustainable development future"), to a speech by Solar Energy Industries Association President Rhone Resch (in which he called the fossil fuel industry "grotesquely oversubsidized"), to a call by President Obama to cut oil company welfare by $4 billion.
 
Not to be outdone, House Democrats are now calling for a $40 billion cut.
Dirty energy welfare defenders have, predictably, responded with ridiculous, Palin-esque denials of reality, but the voter demands that wasteful spending be cut begs the question: just how much of our tax money is going to ExxonMobil, Massey, etc.? With the new deficit hawks in Congress going after insignificant items like bottled water expenses, you'd think they'd want to know the size of the really wasteful stuff, right?

The problem is, we've long suspected that no one really knows how much of our money goes to dirty oil executives like Rex Tillerson and Gregory Boyce. There have been counts, ranging from $10 billion a year by the Environmental Law Institute, to the more comprehensive, $52 billion a year by Doug Koplow of EarthTrack. But, do taxpayers even have a widely accepted, comprehensive inventory of how of our money is being handed to the dirty energy lobby by politicians?  That includes state-level subsidies, by the way, such as the $45 million that Virginia gives to the coal industry.

Energy trends analyst Chris Namovicz of the U.S. Energy Information Administration (EIA) was the latest speaker in our "Communicating Energy" lecture series. We took the opportunity to ask one of the top, neutral energy trends analysts in the country the question, "Do you know if someone has actually done a credible, comprehensive, definitive count of how much taxpayers underwrite fossil fuels in this country?" We added the thought that "there's no one really widely available number whereaverage citizens can say, yeah, this much of my money goes to pay ExxonMobil.
According to Namovicz, there really isn't such a widely available, definitive, comprehensive number.

http://www.youtube.com/v/2B4tgpqjXuY&amp

Right…we're not accounting for the nuclear insurance subsidy, we're not accounting for military oil shipping, we're not even accounting for the tax depreciation benefits that some resources get over others...

The fact is, there is a wide array of government subsidies, both implicit and explicit, that are doled out every year to fossil fuel companies. One estimate, by the Environmental Law Institute, finds that dirty energy companies in the United States alone have run up a $72 billion tab at the taxpayer's bar from 2002 to 2008. Worldwide, it's far worse; as this study by the OECD explains:

The [International Energy Agency] estimates that direct subsidies that encourage wasteful consumption by artificially lowering end-user prices for fossil fuels amounted to $312 billion in 2009. In addition, a number of mechanisms can be identified, also in advanced economies, which effectively support fossil-fuel production or consumption, such as tax expenditures, under-priced access to scarce resources under government control (e.g., land) and the transfer of risks to governments (e.g., via concessional loans or guarantees). These subsidies are more difficult to identify and estimate compared with direct consumer subsidies.

As we pointed out in a recent post, these subsidies aren't just reckless and stupid, they aren't even what people want. In fact, only 8 percent of Americans prefer their tax money be given to highly profitable, mature industries such as ExxonMobil and Massey Energy.

Shouldn't there be a definitive count of energy subsidies? As we're looking at cutting waste from our federal (and states') budgets, shouldn't there be a credible accounting of all the ways we pay to grease the way for these mature, highly profitable industries? We're not talking about one done by dirty energy lobbyists or their hired "experts," by the way, but a real inventory done by those who wouldn't profit by a lower or incomplete count. Such an accounting should include:

• Tax breaks
• Dirty subsidies
• The costs of government agencies that are set up to perform functions that these industries should pay full cost for doing – such as figuring out how to stuff their pollution underground instead of wasting it on exorbitant, fantasy projects like "FutureGen."
• Military expenditures to protect oil shipping lanes.
• Pollution forgiveness or remediation
• Rock-bottom priced access to public property – mountains, subsurface property, aquifers, ocean waters -- which fossil energy companies routinely wreck and pay comparatively little to fix.

We need to force politicians to be aggressively honest about how much of our money is going to Tillerson, Boyce., Blankenship, O'Reilly, Lesar, etc. Until they do, the anti-clean energy bigmouths in Congress who are bashing clean energy policy support need to back way off. And, the dirty energy lobby mouthpieces who propagandize how "cheap" dirty energy is, should do the same. Directly or indirectly, we're paying their salaries.

-Find Your Representatives-Republican or Democrat, and Let Your Voice BE HEARD! Active Participation is Suggested TellMyPolitician

Article by: http://www.renewableenergyworld.com/rea/blog/post/2011/02/top-eia-energy-trends-watcher-no-definitive-count-on-dirty-energy-welfare?cmpid=WindNL-Thursday-February24-2011
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USA vs China- Renewable Energy News

Fact is we're in a race with China. The nation that weans itself from imported fossil fuels first will have an enormous economic advantage. China is no longer willing to be just the "low cost supplier" – its workers are getting raises – but it does plan on using wind and solar energy, along with hydropower and even nuclear energy, to enhance its national security.

The question we have to ask is, can we afford to do less? China thinks renewable energy can help its grandchildren earn more than your grandchildren. Are we up to the challenge? Or are we going to let troubles in places like Libya drive our future?

Those are the stakes. I think most Americans understand this, and it's why renewable energy remains popular. Even in states dominated by conservative Republicans, efforts to overturn renewable energy targets are falling short.

Bolstering Renewables with Patriotism emphasis added by scotty

By Dana Blankenhorn   |   February 23, 2011

Yesterday I asked whether there is a way to trump the arguments of natural gas, on behalf of renewable energy.

The responses were interesting. Some believe we can't. Others that we must. Some pointed out that natural gas prices are volatile, others noted the volatility of energy from wind.

My article focused on the issue of fracturing, exploding small bombs deep in the Earth's crust to stimulate delivery of gas. I acknowledged that while the concerns are real the argument is not winning the day.

Today I want to propose that we have two trump cards to play right now at a time when lawmakers are re-evaluating incentives for many renewable energy programs: Libya and China.

The price explosion that followed recent unrest in Libya can happen at any time, and in many places. Each time it happens, economies that depend on fossil fuels are hit hard. The stock market tanks. We wind up rooting against democracy for fear that our own jobs could disappear if it triumphed. It's a sin we're constantly reminded of on the world stage, a reality our high ideals can't absolve us of.

Fact is that when you tie your economy to a common commodity that is imported you lose your autonomy. America's national security is in the hands of others. Our best and bravest are sent to fight and die to maintain supply lines, even when alternative technologies exist that can cut those ties and reduce that dependence.

China's next five-year plan  (yes, they still have them) focuses on higher wages and domestic demand. But its key buzzword on the supply side is renewable energy.

In an effort to keep growing while expanding renewable energy to 20% of domestic demand by 2020, our rival plans on doing the very same things America's renewable industry wants us to do, starting with a tax on pollution. A carbon trading system is also expected to be part of the plan, due for ratification next month, with environmental and energy efficiency declared "priority industries" for the first time.

Fact is we're in a race with China. The nation that weans itself from imported fossil fuels first will have an enormous economic advantage. China is no longer willing to be just the "low cost supplier" – its workers are getting raises – but it does plan on using wind and solar energy, along with hydropower and even nuclear energy, to enhance its national security.

The question we have to ask is, can we afford to do less? China thinks renewable energy can help its grandchildren earn more than your grandchildren. Are we up to the challenge? Or are we going to let troubles in places like Libya drive our future?

Those are the stakes. I think most Americans understand this, and it's why renewable energy remains popular. Even in states dominated by conservative Republicans, efforts to overturn renewable energy targets are falling short.

I think we have the wind at our backs. Let's not be afraid to use patriotism to close the deal.

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Interesting Info about Feed-In Tariffs and Energy Production

...who would not put solar on their (unshaded) roof? If solar power only costs you 15 cents per kilowatt-hour from your roof, and power from your socket costs you 16.5 cents, you already have a 10 percent profit, and that profit margin will only increase...just as we continue to subsidize coal and oil sectors, which have been profitable for 150 years now.

Feed-in Tariffs Needed After Grid Parity

By Craig Morris, Petite Planète   |   February 22, 2011

A few weeks ago, US solar market analyst Paula Mints published an article essentially arguing that solar is about to reach an "un-incentivized future." Don't hold your breath.

There can be no doubt that photovoltaics (PV) has depended upon governmental support. In particular, where proper feed-in tariffs have been offered, PV has done well – and where such policies were quickly discontinued, markets have collapsed.

This story is basically told in two ways: it either proves that feed-in tariffs are successful – after all, there have been no PV booms without feed-in tariffs yet; or it proves that feed-in tariffs are hard to get right so we are better off without them. Mints apparently belongs in the latter camp (you may have guessed I am in the former).

She speaks of the period from 2004-2008 as the "beginning of the FiT phase of PV industry history" when PV prices increased. Journals like the Economist claimed during those years that German feed-in tariffs were raising the price of photovoltaics for sunny countries, but those journalists do not specialize in photovoltaics, so I do not expect better from them. But Mints merely points out that "in 2009, manufacturers from China and Taiwan priced technology aggressively to gain share."

Surely she knows that Asian manufacturers did that with production lines largely purchased in Germany, and companies like Gebr. Schmid, Roth & Rau, and Centrotherm were only able to come up with turnkey production lines because markets like Germany and Spain had feed-in tariffs that created enough demand.

In other words, the thing that finally brought prices down was that PV production became open to all investors; you didn't need special expertise to put together a customized production line. If you had the cash, you could hire a knowledgeable CTO and buy the production plant off the shelf. With exception of Suntech, which got a lot of its expertise from the quite knowledgeable Australian Martin Green, most Asian success stories are mainly based on German production lines brought about by German and Spanish feed-in tariffs (Australia adopted feed-in tariffs after the Chinese began using Green's ideas). Without Spain and Germany's FITs, no cheap PV from Asia.

Many FIT markets didn't fail

Mints proposes a 12-step program to "recover from incentives." The problem, as she puts it, is that the solar industry remains dependent upon policy, and the era of feed-in tariffs is coming to an end: "it is time to call off the hunt for the next big incentive." For instance, one of her steps is for a manufacturing consortium to "discuss how most FiT markets were destroyed." She sums up the past few years on PV markets as, "Demand boomed, and most FiT markets crashed."

In fact, every gigawatt market in the world for PV was driven by feed-in tariffs. Mints is right that some of these markets have gone bust, but do the other markets (like Germany) that haven't gone bust not show us how to do it right? I can't say that of other PV policies (think of the US or pre-FIT Britain).

Can we agree that solar feed-in tariffs have not failed in "most" countries – and that no non-solar FIT market has undergone boom-and-bust anywhere? A more accurate description would be that feed-in tariffs are the only policy that has led to major success stories for solar, but that some incompetent governments threw in the towel when they saw the price tag. Mints writes, "Here's the golden rule of incentives: they are expensive, and someone has to pay the bill." Actually, it's photovoltaics that's expensive, not feed-in tariffs. Studies have repeatedly found that feed-in tariffs are the least expensive way to promote renewables.

More importantly, feed-in tariffs have actually been less prone to boom and bust than other policies. The production tax credit for wind power in the US was repeatedly not renewed in time during the Clinton/Gore administration, but even when it had been seamlessly extended under Bush/Cheney the policy nonetheless proved ineffective during the financial crisis.

The Stimulus Package under Obama tried to remedy the situation – when no profits are posted, there is little tax to write off – by offering upfront bonuses to cover the purchase price, but in 2010 the US wind market nonetheless was cut in half. While they did struggle to get financing, markets with feed-in tariffs fared much better than the US wind market in 2010, though statistics are not generally in yet for installed PV capacity in 2010. (The US doesn't have accurate figures for PV installations, by the way, mainly for lack of national policy; no single organization is in charge of the tally. So get a national FIT.)

FITs already generally below retail rate

Mints main contention – that solar will be better off when it can do without incentives altogether – seems logical at first glance, but don't hold your breath. FITs for wind and biomass have generally always been below the retail power rate, so why should anything change when solar is no longer the exception? As Mints herself points out, conventional energy sectors also continue to be subsidized. Why should the situation ever be any different for photovoltaics? But the main problem is a different one that she – like others who think that grid parity will make a difference – ignores.

Imagine that photovoltaics starts to drop below the retail rate. It is happening now in sunny places with relatively high retail rates, but the areas will spread, and in all likelihood solar will continue to get cheaper, while retail rates will continue to rise.

Under those circumstances, who would not put solar on their (unshaded) roof? If solar power only costs you 15 cents per kilowatt-hour from your roof, and power from your socket costs you 16.5 cents, you already have a 10 percent profit, and that profit margin will only increase.

If nothing is done, there will be a rush to put photovoltaics on roofs. Demand will initially be higher than supply, so installers will make a nice profit; after all, if solar could be 30 percent cheaper than retail power, people will still be satisfied with 15 percent, and installers can pocket the other 15. Where else can you get a 15 percent return? Without feed-in tariffs, what will keep the price of solar down? (It is worth noting that the average installed kilowatt price in the US is already at least 60 percent higher than in Germany thanks to feed-in tariffs – so much for feed-in tariffs keeping prices up...)

With all of that solar power going online, utilities will have a problem. Germany will have it first. It is likely to have had 18 gigawatts of installed photovoltaics as of the end of 2010, and power demand in the summer generally peaks at around 60 gigawatts. If Germany continues to install 3.5 gigawatts (as the current governing coalition plans), its installed photovoltaic capacity will roughly match peak summer demand by the end of this decade, at which point the country may nonetheless still "only" be getting around six percent of its electricity from photovoltaics (it got around two percent from 18 gigawatts last year).

Power companies that operate nuclear and coal plants will have to respond by ramping down these baseload plants during sunny days, which will make a kilowatt-hour from central plants more costly, which will then make investments in photovoltaics even more profitable – and so on. It's a vicious cycle.

In Germany, the answer is not quite clear yet, but we do know that it has not yet thrown out feed-in tariffs. One reason is because they can actually keep the profit margin for photovoltaics at 5-7 percent once the cost of photovoltaics stops plummeting faster than planned decreases in feed-in tariffs, which is inevitable. In other words, after grid parity, feed-in tariffs will help make photovoltaics cheaper than the technology would be under pure net-metering.

FITs never the same

As Mints points out, "FiTs are a-changin'" – but if she means there was ever a point where they were "a-saming", she's wrong. The "proto FITs" under PURPA were not exactly the same as Germany's first feed-in tariffs from 1990 (where 80 percent and 90 percent of the retail rate was paid for wind power and photovoltaics, respectively), and those tariffs changed dramatically in 2000 (when the retail rate became irrelevant). Other countries have offered feed-in rates with a premium based on what the grid needs (such as for wind power in Spain), while others still are adjusted for inflation (such as in France).

Like Mints, a lot of Germans are also talking about an incentiveless future. But what we probably need over the long run are feed-in tariffs that pay for power production from intermittent sources (especially solar and wind) with a fluctuating premium based on power demand; when renewable power production approaches or exceeds demand too often, the premium will not be paid, and investments in such technologies will not pay for themselves as quickly. The floating cap will find itself, so to speak.

The kind of upfront bonuses to finance equipment purchases (a common practice for solar and wind in the US) should be reserved for power sources that can be ramped up and down as need be to accommodate for shortfalls in intermittent renewable power (I am thinking here especially of biomass and natural gas turbines). In other words, we would pay for solar and wind by the kilowatt-hour and biomass/gas (and possibly nuclear and coal) at least partly by the kilowatt. And we would continue to regulate new installations with specially designed incentives – just as we continue to subsidize coal and oil sectors, which have been profitable for 150 years now.

Craig Morris directs Petite Planète and blogs about Mundane matters at Always Greener. This article originally appeared at Renewables International.

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New Reports Chart Path-Net Zero-Energy Efficient Commercial Buildings

high levels of energy efficiency are the first, largest and most important step on the way to net-zero

New Reports Chart Path to Zero-Net-Energy Commercial Buildings
Press Release Washington, D.C. (February 23, 2011)

– Two new reports from the Zero Energy Commercial Buildings Consortium (CBC) on achieving net-zero-energy use in commercial buildings say “high levels of energy efficiency are the first, largest and most important step on the way to net-zero.”

Leading national organizations such as the Building Owners and Managers Association (BOMA), American Society of Heating, Refrigerating and Air-Conditioning Engineers, Inc. (ASHRAE), American Institute of Architects (AIA), the U.S. Green Building Council (USGBC), the Illuminating Engineering Society (IES), the Association of State Energy Research and Technology Transfer Institutions (ASERTTI), the National Electrical Manufacturers Association (NEMA) and many other commercial building stakeholders worked together over the last year to develop the reports, which highlight the need for new approaches in technology research and deployment, holistic building design and financing as critical elements to further advance energy efficiency in the commercial buildings sector.

The U.S. Department of Energy (DOE) commissioned the reports from the CBC, an industry consortium led by the National Association of State Energy Officials (NASEO), the Alliance to Save Energy (Alliance) and other leading national organizations to identify barriers and make recommendations to industry stakeholders for achieving net-zero-energy commercial buildings over the next two to three decades.

There are many definitions of net-zero-energy buildings, but typically they are highly energy efficient buildings that use no more energy than they can produce on site on an annual basis.

The Next Generation Technologies: Barriers and Industry Recommendations for Commercial Buildings and the Analysis of Cost and; Non-Cost Barriers and Policy Solutions for Commercial Buildings focus on innovative technologies and practices and market-oriented strategies, respectively. (Free copies of the full reports can be downloaded from the CBC website.)

The CBC reports are quite timely, following closely on President Obama’s February 3 announcement about the new Better Buildings Initiative, which is aimed at improving energy efficiency in commercial buildings by 20 percent over the next 10 years by stimulating private investment in building energy efficiency, generating new jobs in construction and facilities operation and saving commercial building owners and tenants nearly $40 billion yearly on utility bills.

“While many details remain to be settled, the Better Buildings Initiative is a very exciting development for the commercial buildings sector, and the CBC fully supports its goals and looks forward to working with CBC members and industry stakeholders to contribute to these efforts,” according to NASEO Executive Director David Terry. “The President’s initiative targets many of the same barriers examined by CBC members over the last year, which are summarized in the two major reports just released by the CBC.”

David Hewitt, lead author of one of the CBC reports and executive director of the New Buildings Institute, noted that “National initiatives such as the BBI can build on and complement important new initiatives by states and utilities, such as California’s Zero Net Energy Action Plan. The job ahead is big enough that everyone’s efforts are needed, and they need to be coordinated – that’s exactly why we created the CBC.”

Additional recommendations in the two reports include:

• Create and sustain market demand for energy efficiency retrofits and new construction through innovative approaches to financing and valuation of energy efficiency improvements. 

• Emphasize voluntary programs, such as President Obama’s Better Buildings Challenge, to catalyze change in corporate culture through strong leadership and commitment to energy efficiency. 

• Enhance and extend building energy codes and standards to cover all energy end uses, emphasize building and systems commissioning and long-term performance.


• Promote wide-scale use of integrated design and whole-building approaches to achieve more aggressive and dramatic energy reductions. 

• Refine modeling and decision-making tools to fully support new financing, codes, design and benchmarking approaches. 

• Develop and build consensus around national workforce standards and increase training efforts for the professional and technical workforce on energy-efficient building design, auditing, retrofitting, commissioning and operations.

“The long-term road to net-zero begins with what we can do today,” notes Alliance Senior Vice President Jeff Harris. “This includes broad application of today’s best energy efficiency technology and sustained energy management practices in the existing stock of commercial buildings. We also need to design new commercial buildings to be ‘net-zero-ready,’ so that it’s easier to continually improve their energy performance as new and even better technologies are introduced over the next 30-50 years – the expected lifetime of today’s new buildings.”

Article from: News You Can Use for February 24, 2011

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