Thursday, June 22, 2017

As Interior pivots to fossil fuel extraction, reports shows it costs taxpayers bigly - Taxpayers lose $7 billion a year due to U.S. subsidies for fossil fuels. The Trump administration might increase that.

In the months since he took office, President Donald Trump has taken steps to uphold some of his campaign promises, namely by deregulating oil, gas, and oil extraction. The Trump administration's newly proposed budget includes new steps in the process of deregulation, specifically by removing significant mechanisms of polluter oversight and boosting the production of fossil fuels on public lands. Despite claims of fossil fuel leasing having a net-negative impact, the Department of the Interior is expecting to find ways to increase government revenue from fossil fuel leases. A new study from Oil Change International reported that current subsidization for fossil fuel production on public lands costs taxpayers more than $7 billion. Interior Secretary Ryan Zinke said that the newly proposed budget is intended to bring in more money for the public.

Democrats in Congress have vowed to oppose the increase in fossil fuel extraction on public lands. “Once again, the Trump Administration has turned its back on Teddy Roosevelt-style conservatism and is instead trying to allow special interests to pillage our natural resources so a wealthy few can make themselves even wealthier,” Senate Energy and Natural Resources Committee ranking member Maria Cantwell (D-WA) said in a statement. “We won’t let him.” The Trump administration is taking other steps to forming a better partnership with industry. The Department of Interior, which is able to issue permits for pipeline right of ways through public lands, has been given a $16 million increase to its oil and gas programs as part of the proposed budget. The budget document, which relies on opening up the Arctic National Wildlife Refuge, also states that "onshore energy mineral leasing" will bring in $330 million more in 2018 than 2017 and that offshore mineral leasing will bring in $450 million. 
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However, it is unclear as to how the Trump administration will be able to reach these goals, and Zinke has stated that testing still needed to be done. The increased revenues was another example of “crazy math in the budget,” said David Turnbull, a spokesperson for Oil Change International. “Those sorts of increases in the royalties received are definitely not attributed to raising the royalty rate, but rather… a totally unrealistic expectation of opening up new oil and gas drilling that will wreck the climate.” The Oil Change International report, which concludes in the $7 billion cost only looks at direct costs to taxpayers. Then, health and climate impacts would merely add on to the existing costs. According to the report, fossil fuel companies are ripping off taxpayer in several ways, including undervaluing leases.“For example,” the report says, “the BLM set rates for ‘renting’ federal lands for oil and gas leases in 1987 to $1.50 per acre, or a fraction thereof, for the first five years of the lease term and $2 per acre, or fraction thereof, for any subsequent year. This rate has not been raised in 30 years — not even to reflect inflation.” In 2011, around 20 percent of offshore leases for oil and gas development completely avoided royalty payments, the report found. The government's decision to support the industry greatly impacts the climate as well -- the report found that “cutting off subsidies to Big Coal in Wyoming would save the same carbon emissions over 20 years as shutting down 32 coal-fired power plants.”


by Samantha Page, Climate Reporter at ThinkProgress

June 25, 2017

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