By Eric Worrall | August 6, 2022
Fund a green project, prop up an oil company – two University of Texas academics have figured out that in Texas at least, oil companies frequently collect the cash at the end of the green rainbow.
Who benefits from renewable energy subsidies? In Texas, it’s often fossil fuel companies that are fighting clean energy elsewhere
Published: August 4, 2022 10.20pm AEST
Nathan Jensen Professor of Government, The University of Texas at Austin College of Liberal Arts
Isabella Steinhauer Master of Public Affairs Candidate and Graduate Research Assistant, The University of Texas at Austin College of Liberal Arts
Texas is known for fiercely promoting its oil and gas industries, but it’s also the No. 2 renewable energy producer in the country after California. In fact, more than a quarter of all the wind power produced in the United States in 2021 was generated in Texas.
By reviewing the applications and ownership documents, we were able to track who actually builds and owns a large portion of the nation’s renewable energy, when and how those assets change hands, and who ultimately benefits from the tax incentives.
The results might surprise you. The majority of utility-scale solar and wind energy projects in Texas aren’t owned by companies focused on renewable energy – they’re owned by energy companies or utilities that are better known for fossil fuels, including some that have aggressively opposed renewable energy and climate policies in other states and nationally.
To our surprise, almost half of the projects built in 2020 or 2021 had changed hands by 2022. Some were due to company acquisitions. Many other projects were sold.
This changed the composition of owners. While renewable energy companies owned roughly half the projects at the application stage, by 2022, two-thirds of the projects were owned by utilities and energy companies with fossil fuel assets.
The original developers may have benefited from the first year or so of the tax break, but the new owners are poised to reap the majority of the remaining years of the 10-year property tax incentive.
Personally I find this hilarious – big oil is collecting the lions share of the subsidies which are meant to be helping green energy businesses compete with big oil.
I have no doubt oil companies are at the end of a lot of other green rainbows, not just Texas. Oil companies are experts at positioning themselves to make money, and have vast experience with milking dictatorships, rigged markets and command economies.
Keep up the funding for big oil, greens.