Economics for the Earth Blog

Even Without Handouts for Liquid Coal, Tax Package Pending in Senate Could Subsidize Dirty Energy

Posted Jun. 8, 2010 / Posted by: Nick Berning


Scott Baumgartner, 202-222-0751,
Alex Moore, 202-222-0733,

Even Without Handouts for Liquid Coal, Tax Package Pending in Senate Could Subsidize Dirty Energy

Friends of the Earth urges senators to further clean up bill after House of Representatives axed liquid coal subsidy

WASHINGTON, D.C.—Friends of the Earth dirty fuels campaigner Alex Moore had the following statement regarding the “American Workers, State, and Business Relief Act of 2010” (HR 4213), which includes a variety of tax breaks for polluting industries and may soon come up for a vote in the Senate. The bill passed the House of Representatives Friday, May 28.

“We are pleased to see that the House voted to eliminate all subsidies for the production of dirty liquid coal, which generates twice as much global warming pollution as regular gas. The House leadership deserves credit for its instrumental role in removing these subsidies.

“However, improvements are still needed. Senators now considering the bill must vote to end a loophole in the Build America Bonds program that has funneled a billion dollars since 2009 to other dirty coal projects.”

The liquid coal tax credits eliminated by the House (26 U.S.C. § 6426(d) & 6426(e)), subsidized liquid coal production at $0.50 per gallon. Liquid coal is not currently being produced in the U.S., so this credit aimed to create an industry that would be dependent on government assistance. The credit expired in December 2009 and the coal lobby had been pushing for its extension.

In addition to liquid coal, Congress also cut a subsidy for refined coal, a product used in electricity generation.



Friends of the Earth and our network of grassroots groups in 77 countries fight to create a more healthy, just world. Our current campaigns focus on clean energy and solutions to global warming, protecting people from toxic and new, potentially harmful technologies, and promoting smarter, low-pollution transportation alternatives.

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