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Federal Support Of Fossil Fuels

Discussion in 'Energy, Environment, and Policy' started by TheTalkingMule, Sep 25, 2013.

  1. TheTalkingMule

    TheTalkingMule Active Member

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    Philadelphia, PA
    20 minutes ago I didn't not know this existed, so bear with me and let me know if I'm way off here.

    With the success of Tesla the DoE loan program isn't really brought up anymore as a negative, but I came across a DoE loan from the 80's that to me would've been a great one to reference in the face of an anti-solar "Solyndra rant".

    The Great Plains Synfuels Plant in North Dakota was developed in the 80's on the back of a $2 BILLION DoE loan guarantee to produce nat gas and other byproducts from coal. The original company goes bankrupt in less than 2 years and the DoE ends up "buying" the company for $1B. It then sells to a different private entity for $81M.

    How is that not 1,000x worse than Solyndra? The best thing is that there's been a "revenue sharing" agreement with the DoE since 1988. How much have they recovered of their $2B investment?

    Essentially $550M.

    At least Solyndra legitimately went out of business due to market forces, these guys are still making billions and have paid back $550M on a $2B DoE investment from 25 years ago.

    The amount of government support for the oil and gas industry must amount to a good 8-10% of the total federal debt if you just think about it in raw dollars. Maybe more. I completely understand that we need to make investments in our energy security and whatnot, but don't try to tell me there's any kind of level playing field. We don't really pay $0.11 for a kWh of grid electricity when you take all these taxpayer funded fossil fuel pork projects into consideration. The value of the dollar has doubled since 1983, so we're talking about a $4 billion dollar gift to some company in North Dakota.

    It's very interesting what they're doing there today with the pumping of CO2 into the Alberta ground trying to get more oil and yes I think the people of ND should have access to nat gas, but I think these companies should primarily make their own investments and then charge an appropriate market price for their product.
     
  2. AudubonB

    AudubonB Mild-mannered Moderator Lord Vetinari*

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    I had forgotten the late 80s interest in gasification plants. A quick peek through the 'web provides little in the way of leads toward the funding machinations you provided - have you some references for that?
    BTW - penultimate paragraph: the value of the dollar has halved, not doubled !!!!!! I know that's what you meant......
     
  3. vfx

    vfx Well-Known Member

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    Oil companies have been getting breaks since oil has been used in automobiles. They surpassed peanut oil, kerosene, bio fuels, electricity and wood/steam to power cars and continue to get breaks like having the US protect the lands where they have fields of wells.
     
  4. TheTalkingMule

    TheTalkingMule Active Member

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    I'm going to do some research and try to find the best tally of US government support for the fossil fuels industry. I'm sure plenty of people have taken a stab at this, should be an interesting number.
     

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