EIA report undercounts fossil fuel and nuclear energy subsidies

The Energy Information Administration’s latest report on federal energy subsidies, released Aug. 1, underreported direct and indirect federal subsidies to the nuclear and fossil fuel industries, creating an inflated view of the subsidies that benefit renewable energy and efficiency programs, according to the Union of Concerned Scientists. Although the agency concedes that its methodology failed to account for all subsidies that benefit conventional energy sources, its consistent underreporting over the years has enabled advocates of fossil fuel and nuclear technologies to falsely claim they benefit from very few federal energy subsidies compared with renewable energy technologies...

This is not the first time that the EIA has produced a flawed analysis. A 2010 report by Doug Koplow of Earth Track, EIA Energy Subsidy Estimates: A Review of Assumptions and Omissions, for example, identified numerous omissions in the EIA’s 2007 federal subsidies report that undercounted billions of dollars in direct and indirect subsidies to conventional energy sources. Koplow identified a number of problems with the EIA’s methodology, ranging from using a limited number of sources to ignoring many energy sector subsidies.

“In combination, problems of estimation and omission in EIA’s work render a picture of subsidies that has more to do with the scope and manner of its research than with the actual impact of policies in place,” the report concluded. Although Koplow provided the EIA with a list of detailed recommendations to correct these deficiencies, the agency’s methodology in its new report closely tracks what it used previously.