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US Taxpayers Will Pay Billions in New Fossil Fuel Subsidies Thanks to the Big Beautiful Bill
A report finds that President Trump’s flagship legislation will grant $40 billion in new subsidies to the oil and gas industry over the next decade.
But the phaseouts of these subsidies were nixed during climate legislation negotiations with then-senator Joe Manchin of West Virginia, who was the key swing vote in the Senate at the time and a recipient of fossil fuel money with lengthy ties to the coal industry. Meanwhile, the Inflation Reduction Act—the resulting compromise between Manchin and Democratic leadership, which was passed in August of 2022—gave additional boosts to the fossil fuel industry in the form of subsidies for oil-and-gas-friendly technologies, like carbon capture and storage and certain types of hydrogen made with natural gas. Kotchen, the Yale economist, calculated in a 2021 paper published in the Proceedings of the National Academy of Sciences that a small handful of US oil, gas, coal, and diesel giants, by not having to pay for the damage they cause, get $62 billion in what he calls “implicit subsidies” per year.
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