In a piece Nuclear Industry Subsidies Part I: Definitions, author Charles Barton looks at the definition of subsidy and what it meant to fledgling technologies as they first developed consumer applications in such areas as radio, jet aircraft, and the energy industry.
Mr. Barton notes how the United States domestic oil industry benefited greatly from government subsidies in the form of tax laws. From the article:“Government subsidies have also played an important role in energy related industries. The domestic oil and gas industry was granted three tax code preferences, or subsidies:
(1) expensing of intangible drilling costs (IDCs) and dry hole costs, introduced in 1916;
(2) the percentage depletion allowance, first enacted in 1926 (coal was added in 1932);
(3) capital gains treatment of the sale of oil and gas properties.
Oil depletion allowances amount to a huge government subsidy of the oil and gas business. Robert Bryce described the operation of oil depletion:
“An oilman drills a well that costs $100,000. He finds a reservoir containing $10,000,000 worth of oil. The well produces $1 million worth of oil per year for ten years. In the very first year, thanks to the depletion allowance, the oilman could deduct 27.5 per cent, or $275,000, of that $1 million in income from his taxable income. Thus, in just one year, he’s deducted nearly three times his initial investment. But the depletion allowance continues to pay off. For each of the next nine years, he gets to continue taking the $275,000 depletion deduction. By the end of the tenth year, the oilman has deducted $2.75 million from his taxable income, even though his initial investment was only $100,000.”
President John Kennedy was fighting to repeal the oil depletion allowance at the time of his death, and a Democratic attempt to repeal it was recently killed in the Senate.” –Charles Baron
Gulf Awash 27,000 Abandoned Wells from Associated Press.
Mr. Barton also examines various reports on the costs of wind energy, in particular, the Cape Wind Project which plans 130 turbines off the coast of Nantucket, Massachusetts in the United States to produce up to 420 MW of electricity.
Critics of the project point to its heavy subsidies totaling “at least a $730 million dollar subsidy from the Federal government, half of its total costs” while projections for the cost of the generated electricity range from $0.12 to $0.14 per kwh on the low-end to $0.20 to $0.24 per kwh on the high end. That’s “still far above today’s 6 to 8 cents for natural-gas generated electricity.”Federal funding has supported industries based on new technologies in the past. Today, governments worldwide have no cash for new-energy research, even as private investment looks the other way, and the energy industry puts virtually nothing into research and development.
If patents aren’t issued, government is not only withholding funding, it’s inhibiting the technological development of clean energy.
Working to ensure the new-energy movement has funding from both private and government entities includes demanding federal laws and tax-breaks that support new-energy researchers and companies developing clean LENR technologies.
Talk to your Senators, Congresspersons, and elected officials today.
Tell them to move away from subsidizing dirty fossil fuels and dangerous nuclear power plants and support LENR research now.
In the US? Contact your representatives here.
Charles Barton Nuclear Industry Subsidies Part I: Definitions.
Charles Barton Nuclear Industry Subsidies Part II: The Mining Sector
Cape Wind Project http://www.capewind.org/
I Want to Believe by Ruby Carat May 18, 2011
Union of Concerned Scientists report Nuclear Power: Still Not Viable Without Subsidies 2011
USA.gov Contact your Elected Officials