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Total Federal energy-specific subsidies and support to all forms of energy are estimated to have reached $16.6 billion for the 2007 fiscal year, more than double the $8 billion in real terms of subsidies completed in May 2000, according to a recent report by the Energy Information Administration (EIA).
The report, Federal Financial Interventions and Subsidies in Energy Markets 2007, also reveals that tax expenditures have more than tripled since 1999, rising from $3.2 billion in 1999 to more than $10.4 billion in 2007.
Federal electricity subsidies and support per unit of production (dollars per megawatt hour) varied widely by fuel in FY2007, according to EIA. Coal-based synfuels (refined coal) that are eligible for the alternative fuels tax credit, solar power and wind power received the highest subsidies per unit of generation, ranging from more than $23 to nearly $30 per megawatt hour of generation.
The smallest subsidies on a per unit basis were for coal, natural gas and petroleum liquids, and municipal solid waste, all at less than $0.45 per megawatthour of generation.
The report responds to a request from Senator Lamar Alexander of Tennessee that the EIA update its 1999 to 2000 work on Federal energy subsidies, including any additions or deletions of Federal subsidies based on Administration or Congressional action since 2000, and providing an estimate of the size of each current subsidy. Subsidies directed to electricity production are estimated on the basis of generation by fuel.
Editor's note: Table ES5 in the Executive Summary shows that wind energy receives subsidies at 53-times more than coal when measured on a per megawatt basis.
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