Letter to Senate: Oppose Subsidies for Unconventional Fuels in NDAA

Energy & Natural Resources, National Security, | Our Take

Jun 12, 2013 | 3 min read | Print Article

Oppose Amendments to Defense Authorization Bill that
Provide Subsidies for Unconventional Fuels

June 12, 2013

Chairman Carl Levin	Ranking Member James Inhofe
Committee on Armed Services	Committee on Armed Services
United States Senate	United States Senate
Washington DC 20510	Washington DC 20510

Dear Chairman Levin and Ranking Member Inhofe:

In addition to supporting amendments that would cut wasteful weapon systems, provide for contracting or benefit reform, Taxpayers for Common Sense urges you to oppose amendments to the Defense Authorization Bill that would provide the Department of Defense (DOD) the authority to enter into long-term contracts for the purchase of unconventional or synthetic fuels, or promote the purchase of high carbon fuels that carry long-term taxpayer liabilities. Taxpayers were stuck with the tab after the synthetic fuels industry failed in the 1980’s and purchasing these high risk fuels today is just as risky of an investment as it was two decades ago.

When Congress created the $15 billion Synthetic Fuels Corporation in the 1980’s to fund coal liquids and other synfuel projects, volatile oil prices drove the unconventional fuels industry into near bankruptcy, wasting billions of dollars spent on capital. This time around taxpayers could be locked into the purchase of uneconomical high carbon fuels that carry enormous long-term liabilities. Section 526 of the Energy Security Act of 2007 helps protect taxpayers from purchasing fuels that produce more carbon emissions than conventional fuels. This common sense policy will help taxpayers avoid additional costs and risks down the road. Furthermore, the Department of Defense has weighed in supporting the goals and intent of Section 526 and said that repeal could “hamper the Department’s efforts to provide better energy options to our warfighters.” We urge you to oppose efforts to repeal this provision.

Alternative fuels that produce higher carbon emissions than traditional oil and gas are not the solution to the nation’s energy woes and both industry and independent experts agree that these technologies will require significant government support. Taxpayers should not be forced to foot the bill for expensive technologies that lock us into long-term liabilities.

Again TCS urges you to support amendments that would cut wasteful weapon systems, provide for contracting or benefit reform, and oppose any amendments to provide authority to enter into long-term contracts with synthetic fuels, repeal Section 526 or other subsidies for this unconventional fuels technology. The synthetic fuels push of the early 1980’s failed and there is no need to repeat this costly mistake. If you would like additional information please contact me or Autumn Hanna at (202) 546-8500 or autumn@taxpayer.net.

Sincerely,