Gulf of Mexico Oil Spill Blog Obama Eliminate $4 billion Annual Oil Tax Incentive

Obama Eliminate $4 billion Annual Oil Tax Incentive

green obama

President charts proposal to wean U.S. off foreign oil Pushes for more research on alternative fuels


WASHINGTON — Even as he called for a five-year freeze in overall federal spending, President Barack Obama on Tuesday charted a plan for investing billions more dollars in “clean energy” programs that he said would boost U.S. competitiveness, wean the U.S. off foreign oil and aid the nation’s economic recovery.

Obama prodded lawmakers to subsidize research on cleaner-burning, alternative energy sources at the expense of oil, natural gas and coal.

“With more research and incentives, we can break our dependence on oil with biofuels and become the first country to have 1 million electric vehicles on the road by 2015,” he said. “We need to get behind this innovation – and to help pay for it, I’m asking Congress to eliminate the billions in taxpayer dollars we currently give to oil companies.”

Investing in tomorrow

Obama’s decision to target $4 billion in tax incentives used annually by oil, gas and coal producers has been rejected twice by Congress. The plan also is bitterly opposed by oil and gas industry leaders, who say that any short-term gains in tax revenue would be offset by suppressed domestic energy production.

But Obama said the U.S. can’t afford to lose the global fight over who will be the world leader in producing the solar panels, batteries and energy technology of the future. “Instead of subsidizing yesterday’s energy, let’s invest in tomorrow’s,” Obama said, as he outlined plans for to boost federal spending on clean energy technology by $2 billion a year.

Embraces ‘clean coal’

Obama’s clean energy spending plan puts him on a collision course with congressional Republicans, who have proposed eliminating the Energy Department’s Applied Energy Research program.

Obama also called on Congress to back a goal that by 2035, 80 percent of America’s electricity will be generated by clean energy sources.

But Obama dodged a fight over what types of power might qualify, by urging an expansive definition that embraces nuclear power, natural gas and “clean coal” technology as well as electricity generated by the wind and sun.

A narrower proposal to force utilities to generate more of their power from renewable sources has faltered amid resistance from nuclear backers and lawmakers from coal-producing states.

Oil and gas industry leaders said Obama squandered an opportunity to emphasize the importance of traditional energy production, even as part of a transition to alternative power. “The president focused on job growth through federal spending, but was silent on one of the best ways to create jobs: allow more energy development,” said Jack Gerard, president of the American Petroleum Institute. “Natural gas and renewables are important components of our energy mix, but we will need our nation’s vast oil resources for decades to come.”

source: President charts proposal to wean U.S. off foreign oil | Energy | – Houston Chronicle

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