Oil Change International (OCI) has been doing superb work in recent months, detailing the damage done by taxpayer-funded subsidies to the fossil fuel industry. For instance, in Subsidy Spotlight: Paid to Pollute and Poison, OCI reports that “federal and state subsidies to the oil, gas, and coal industries result in a $21 billion windfall for carbon polluting companies every year,” and that “risky drilling projects like those undertaken by BP would most likely never occur without this type of corporate welfare.”
Another OCI report focuses on subsidized fracking, and how “this experiment of exposing people to toxics released by natural gas development would not occur without billions in subsidies from the federal and state governments.” Also see OCI’s “Cashing In On Carbon: How Taxpayer Dollars Greenwash Dirty Energy,” which argues that “[t]hrough grants, tax breaks, and loan guarantees, the public is paying the financial costs––while shouldering the consequences––of re-shaping the carbon cycle to justify the continued use of dirty fuels and dangerous methods under the auspices of mitigating climate change.” In short, taxpayer subsidies to the fossil fuel industry are harming the environment and people’s health, for absolutely no good reason whatsoever.
Now, OCI is out with yet another example of the tremendous cost of fossil fuel subsidies and the damage they do, with the article “Subsidy Spotlight: Paying the Price of Tar Sands Expansion.” The focus of this piece is the subsidies supporting upgrades to refineries, which allow them to more easily (and profitably) process tar sands, and also the adverse health impact that dirty tar sands byproducts like petroleum coke (“petcoke”) have on communities. Here’s a short excerpt, but we most definitely recommend that you read the entire article, as this is a terrific piece of journalism.
In December 2013, after six years of community pushback, court battles, Environmental Protection Agency citations, and ongoing construction in spite of it all, BP’s $4.2 billion retrofitted facility came fully online.
It was now a tar sands refinery, capable of refining 350,000 barrels of the world’s dirtiest oil per day. And it was paid for, in large part, by U.S. taxpayers.
A little-known tax break allows companies to write-off half of the cost of new equipment for refining tar sands and shale oil. According to a report by Oil Change International, this subsidy had a potential value to oil companies (and cost to taxpayers) of $610 million in 2013.
Tar sands are petroleum deposits made up of bitumen mixed in with sand, water and clay. Their production is extremely destructive at every stage: from strip mining indigenous lands in Canada, to disastrous accidents along transportation routes, to dangerous emission levels produced by refining the heavy crude, to the hazards imposed on communities saddled with tar sands byproducts like petroleum coke (“petcoke”), and finally to the greenhouse gases pumped into the atmosphere when the end product is used for fuel.
Despite all the reasons to keep tar sands in the ground, the refining equipment tax credit has helped put tar sands development in the U.S. on the rise, accelerating climate change at the expense––in every sense of the word––of American taxpayers.
Last but not least, if you’re interested in helping “put an end to fossil fuel subsidies and extreme energy extraction,” please click here.