One surprisingly common notion is that fossil fuels are heavily subsidized in America and that renewable energy subsidies only put them on par with fossil fuels. This is a great example of how oft-repeated narratives can take on a life of their own, irrespective of reality. With the recent...
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With the recent release of a U.S. Energy Information Administration (EIA)
report on energy subsidies, now is a good time to set the record straight on this topic.
The United States spent $29.4 billion on energy subsidies in 2022. Of that, $8.7 billion were “end-use” subsidies, mainly financial assistance for energy in low-income households ($3.8 billion), home energy efficiency subsidies ($2.7 billion) and electric vehicle subsidies ($1.1 billion). Another $481 million went to environmental conservation. That leaves $20.2 billion, 89 percent of which is for tax breaks.
Of that $20.2 billion, $15.6 billion went to renewable energy and $3.2 billion to fossil fuels. This yields a split of 77 percent of energy subsidies going to renewables and 16 percent going to fossil fuels (the remainder go to nuclear and other energy types). Fossil fuels produced 80.8 quadrillion British thermal units of energy in 2022, while renewables produced 13.3 quadrillion—meaning that, on average, renewable energy is subsidized 29 times as much as fossil energy.