Contents
Contacts 3
Preface 4
Executive Summary 10
Subsidy categories 10
Not all subsidies impacting the energy sector are included in this report 12
Key findings 14
Findings regarding electricity-related subsidies and support 19
Findings regarding subsidies and support for fuels used outside of the electricity sector 21
Sources of direct expenditure and R&D expenditure subsidy data 23
A wide variety of definitions, methods, and estimates occur in other energy subsidy studies 26
1. Introduction 27
Background 27
Subsidy categories 27
Data sources 29
Sources of direct expenditure and R&D expenditure subsidy data 31
Organization of report 32
2. Tax Expenditures and Direct Expenditures 33
Overview 33
Tax expenditures 33
Tax expenditure estimation issues, including the Alternative Minimum Tax (AMT) 36
Energy-specific tax expenditure programs 37
Coal-related tax expenditures 37
Renewable-related tax expenditures 41
Natural gas and petroleum-related tax expenditures 46
Nuclear-related tax expenditures 47
Energy efficiency and conservation-related tax expenditures 49
Electricity transmission-related tax expenditures 53
Energy-specific direct expenditure program descriptions 54
Direct expenditures by fuel, department, and program 55
Direct expenditures by agency 56
3. Federal Energy Research and Development 68
Research and development by fuel 68
Research and development by agency 69
Department of Energy 69
National Science Foundation 70
Other agencies 71
4. Federal Electricity Programs 77
Introduction 77
Measuring the support 78
Rural Utilities Service, Electric Program 79
Tennessee Valley Authority 81
Power Marketing Administrations 83
Bonneville Power Administration 84
The smaller Power Marketing Administrations 85
Summary 87
5. Loan Guarantee Programs 89
Introduction 89
Other energy-related loan guarantee programs 92
Appendix A. Request Letter 93
Table ES1. Value of energy subsidies by major use, FY 2010 and FY 2013 15
Table ES2. Quantified energy-specific subsidies and support by type, FY 2010 and FY 2013 16
Table ES3. Total energy subsidies and support and selected energy indicators, FY 2010 and FY 2013 18
Table ES4. Fiscal Year 2013 electricity production subsidies and support 20
Table ES5. Measures of electricity production and growth 22
Table ES6. Subsidies and support to fuels used outside of the electric power sector 23
Table 1. Estimates of energy-specific tax expenditures, FY 2010 and FY 2013 35
Table 2. Estimates of coal-related energy-specific tax expenditures, FY 2010 and FY 2013 38
Table 3. Estimates of renewable-related energy-specific tax expenditures, FY 2010 and FY 2013 42
Table 4. U.S. renewable net generation, selected years 42
Table 5. New CREBs allocations by project technology type and issuer, 2009 45
Table 6. Estimates of natural gas- and petroleum-related energy-specific tax expenditures, FY 2010 and FY 2013 46
Table 7. Estimates of nuclear-related energy-specific tax expenditures, FY 2010 and FY 2013 48
Table 8. Estimates of conservation, efficiency, and end-use energy-specific tax expenditures, FY 2010 and FY 2013 50
Table 9. Estimates of electricity transmission-related energy-specific tax expenditure, FY 2010 and FY 2013 53
Table 10. Estimates of direct expenditures in energy, FY 2010 and FY 2013 58
Table 11. Estimates of direct expenditures in energy by beneficiary, FY 2010 and FY 2013 61
Table 12. Estimates of direct expenditures in energy by beneficiary, department, and program, FY 2010 and FY 2013 62
Table 13. Section 1603 facility property eligibility amounts 67
Table 14. Estimates of research and development expenditures in energy, FY 2010 and FY 2013 72
Table 15. Estimates of research and development expenditures in energy by beneficiary, FY 2010 and FY 2013 73
Table 16. Estimates of research and development expenditures in energy by beneficiary, department, and program, FY 2010 and FY 2013 74
Table 17. Interest rates used to estimate federal utilities and RUS interest subsidies, 2010 and 2013 79
Table 18. Estimate of federal electricity interest rate support to RUS rural electricity borrowers, FY 2010 and FY 2013 81
Table 19. Estimate of federal electricity interest rate support to TVA, FY 2010 and FY 2013 83
Table 20. Estimate of federal electricity interest rate support to BPA, FY 2010 and FY 2013 85
Table 21. Estimate of federal electricity interest rate support to the three smaller PMAs Combined, FY 2010 and FY 2013 86
Table 22. Estimate of federal electricity interest rate support to RUS borrowers and federal utilities, FY 2010 and FY 2013 87
Table 23. Estimate of federal electricity interest rate support to RUS borrowers and federal utilities using midpoint interest rate by fuel type, FY 2010 and FY 2013 88
Table 24. Additional lending authority for loan guarantee programs in selected federal government agencies, FYs 2004, 2010, and 2013 90
Table 25. Characteristics and loan guarantee amounts for Department of Energy Loan Programs Office projects 91
Figure ES1. Electricity generating gross capacity additions by year 21
Figure ES2. Department of Energy budget appropriation amounts, obligations incurred, and net outlays, FYs 2009-2013 25
Figure 1. Data sources for energy-related subsidies 30