In January, President Biden signed Executive Order 14008 that included a section promising to “eliminate fossil fuel subsidies from the budget request for Fiscal Year 2022 and thereafter.” Taxpayers for Common Sense has pushed policymakers to cut subsidies for fossil fuel interests in the tax code, discretionary appropriations, and leasing policies for decades. Supporting the mature oil, gas, and coal industries skews energy markets and wastes billions of dollars every year. The subsidies also undermine other federal spending intended to limit environmental and climate liabilities. EO 14008 was a good signal, but based on what we have seen so far the FY22 proposal doesn’t include a lot beyond what we saw in the Obama Administration.

The budget request does propose cutting existing tax subsidies for oil, gas, and coal companies. But the tax code is just one avenue for fossil fuel subsidies. Some budget documents from the Department of the Interior (DOI) and other agencies have not yet been released, but there’s no evidence that the Biden Administration is proposing to reform management of fossil fuel development on federal lands and waters. At least not yet. DOI is in the midst of conducting a review of the federal oil and gas program and could propose changes when it concludes, reportedly this summer. But if those proposals never come, it would mean a huge, missed opportunity for taxpayers. Through antiquated lease terms, and generous policies, taxpayers lose billions of dollars every year in lost revenue from federal management oil, gas, and coal development.

On the discretionary spending side, there’s also little to be found.  In the agencies where TCS has identified fossil fuel subsidies in the past, DOI and the Department of Energy, we don’t see any proposed cuts. Revenues from federal oil, gas and coal development are not predicted to increase substantially and the budget proposes increased funding for oil and gas program management, but we’re not sure what that means. On the other hand, the Biden Administration’s budget seems to increase spending on some supports to the oil and gas industry, like carbon capture and sequestration funding.