Billions in Energy Tax Subsidies Left on the Books

Tax BriefBillions in Energy Tax Subsidies Left on the BooksMany energy industries will benefit from what the final tax bill doesn’t include.

The tax bill being brought up for vote in the House and Senate will add more than $1 trillion to the national debt in the next ten years. Overall, the energy sector comes out as a winner, keeping many lucrative tax breaks in place and ignoring new revenue raisers like a carbon tax.

Here’s a list of some tax preferences for energy industries NOT cut by the conference tax bill, and what the Joint Committee on Taxation (JCT) has estimated they cost under current tax rules.

The above represent provisions that were never on the table. In addition, there were some that were affected by either the House or Senate drafts of the tax bill, but were ultimately left untouched in the final bill. (See our separate analysis of these provisions HERE.) Below are estimates of what these provisions cost under current tax rules.

Energy Tax Subsidies Dropped from Final Bill

Provision 10-yr. Cost
($ millions)
Credit for production of electricity from renewable sources (aka, Renewables PTC) ** 40,000
Credit for investment in renewable energy property (aka, Renewables ITC) ** 20,000
Ability to form MLPs for oil, gas, & coal companies 9,900
Credit for electric drive vehicles 8,800
Enhanced oil recovery (EOR) credit 371
Oil and gas marginal wells credit
TOTAL 79,071
** Cost estimate reflects a rough approximation based on JCT 5-yr. estimates that cannot be extrapolated due to phaseout of credits