These statistics indicate that for most of us, our values include mitigating climate change and making changes to improve our environmental impact. The US Federal Government and a few select State governments provide $21.5B in subsidies to the fossil fuel industry. One third of that subsidy, $6.5B annually, directly subsidizes oil exploration both within the United States as well as overseas - that is almost as much as the entire funding the EPA receives. What could we accomplish if we were to simply stop public funding of oil exploration?
According to Steve Stoft, Energy Economist with Global Energy Policy Center, the boost needed by renewable energy is small. Taking wind power as an example, Mr Stoft details:
Suppose the government has financed the initial subsidy with 20-year Treasuries. The cost of paying off such a loan can be computed using a spreadsheet’s mortgage-payment formula and that cost is $203 per year for 20 years. This comes to 2.7¢/kWh of electricity generated, but the investor pays 1.9¢/kWh in ‘as if’ coal payments. This leaves the government holding the bag for just 0.9¢/kWh, and that is the cost of this form of subsidy.
Let’s apply Mr Stoft’s concept above using the oil exploration subsidies to fund development of renewable energy infrastructure and see how far that could get us. At 0.9¢/kWh, the $6.5 billion oil exploration fund could support the development of 722 billion kwh. That is equal to 2.5 quadrillion BTU’s of energy, or approximately 2.5% of the current total energy consumption in the United States.
"Wash, rinse, repeat" and viola, we create significant change. If that oil exploration subsidy is permanently changed to clean energy support, that 2.5% annual increase in renewable energy would have a significant impact.
By simply converting the oil and gas exploration subsidy – and that leaves two thirds of the current fossil fuel subsidies in place mind you - to a subsidy scenario supporting our stated shared values of increasing clean energy available in the US, we could be entirely powered without fossil fuels by 2063.
What is more, this scenario would achieve a 50% reduction in fossil fuel use by 2040. By 2069 renewable energy could provide 100% of US power consumption need. Where are long-term public investments better placed? Chasing a dwindling finite resource whose days are numbered, or investing in the development of clean energy sources which cannot be exhausted?
If just 1/3rd of the Federal Oil subsidy went to clean energy instead, the US could be fossil free by 2069.
As Clean Energy Action points out: "Since most of the subsidies that fossil fuels receive have been written permanently into United States tax code, they are able to take full advantage of these subsidies". This is also a clear message for those of us who see a better future, who believe we are capable of creating a clean future for our children. This tells each of us who believe we can do better as a society, that we have a personal responsibility to act and to bring about change.
The good news is we can do some things to make a positive impact:
- Contact your State and National representatives and tell them you expect to see strong support for long-term energy security for our country through investment in renewable energy infrastructure.
- Talk to your employer and ask them to work with their utility company to purchase all of their power through renewable sources. If that option is not available, ask them to invest in renewable resource development in the form of Carbon Offsets equal to the organization’s impact.
- On your personal front, explore ways you can reduce your energy needs. If you have the resources you can also invest in renewable energy for your home. If you are not in a position for that level of investment, you can look to offset your own personal impact, creating an investment helping to increase renewable energy infrastructure in US.