RELEASE: REP. RO KHANNA REINTRODUCES THE END POLLUTER WELFARE FOR ENHANCED OIL RECOVERY ACT

Washington, DC - Today, Representative Ro Khanna (CA-17), reintroduced the End Polluter Welfare for Enhanced Oil Recovery Act (EOR) to end the tax break rewarding the fossil fuel industry for using carbon capture for EOR. The legislation would reform one of the largest and most egregious domestic fossil fuel subsidies, The Tax Credit for Carbon Sequestration (Section 45Q).

Fossil fuel companies currently receive a tax credit for injecting carbon dioxide into oil wells to extract more oil, a process known as enhanced oil recovery (EOR). After the credit was expanded in the 2022 IRA, as much as 83% of captured carbon dioxidewas used for EOR while oil and gas company profits soared 160% above pre-pandemic levels. Big Oil made $250 billion in profits while most Americans paid more at the pump than before the expansion of this subsidy. The public should not be paying at the pump for increasing the profits of the fossil fuel industry.

"Subsidizing carbon capture for drilling undermines our ability to hold Big Oil accountable for the climate crisis," said Rep. Ro Khanna. "Congress has a responsibility to expose climate disinformation as harmful to both the environment and Americans' wallets. We need to end fossil field subsidies and begin investing in clean energy technology that will steer us towards a thriving clean energy economy."

"It is past time to cut enhanced oil recovery from the Section 45Q tax credit. Using federal funds to subsidize the use of captured carbon for oil extraction and Big Oil profiteering is dangerous and unacceptable," said Congresswoman Cori Bush. "Paying for enhanced oil recovery with taxpayer dollars worsens air pollution and fuels a climate crisis that disproportionately impacts the health, wealth, and safety of low-income, marginalized communities. I am proud to co-sponsor the End Polluter Welfare for Enhanced Oil Recovery Act because we need climate action that prioritizes people and the planet, not the greed of dying industries."

"Fossil fuel companies have raked in astronomical profits at the expense of communities while Big Oil and Gas lobbyists actively work to keep us hooked on their polluting products that perpetuate the climate crisis," said Mahyar Sorour, Director of Beyond Fossil Fuels Policy at the Sierra Club. "It is absurd that taxpayers should then also provide a blank check through subsidies, corporate giveaways, and sweetheart deals. We must end the billions of dollars in wasteful taxpayer subsidies to the fossil fuel industry, and we are grateful to Rep. Khanna for leading this legislation."

"The existing 45Q tax credits are perverse by paying the polluting fossil fuel industry to pollute even more," said Carolyn Raffensperger, executive director of the Science and Environmental Health Network. "Besides, the oil companies are wealthy enough that they don't need public money. This essential legislation corrects that by eliminating the tax credit for enhanced oil recovery."

"We applaud Representative Khanna's leadership in introducing the End Polluter Welfare for Enhanced Oil Recovery Act," said Jim Walsh, Policy Director, Food & Water Watch. "Handing over public money to fossil fuel companies for oil drilling is a wasteful and misguided subsidy that undermines our climate goals and perpetuates public health threats from fossil fuel development. It's hard to see CCS as anything other than a profit-driven scheme when as much as 83% of the carbon dioxide captured by dirty energy interests is being used to extract more oil. It is time for this to stop."

"This bill takes a crucial step toward ending greenwashed CCS subsidies that prolong reliance on fossil fuels," saidCamden Weber, deputy political director at the Center for Biological Diversity Action Fund. "With heat records broken everywhere, we don't need enhanced oil recovery anywhere. This bill will get us on track to keeping more fossil fuels in the ground, where they belong."

"As climate disasters grow more frequent and severe, it's unconscionable that American taxpayers are still subsidizing oil and gas companies to extract even more fossil fuels through so-called 'Enhanced Oil Recovery,'" saidEvergreen Senior Energy Transition Policy Lead Mattea Mrkusic. "We shouldn't be left footing the bill to help Big Oil boost its profits while burdening the American people with a crisis costing billions every year. By eliminating these wasteful tax giveaways, this bill takes a crucial step toward ending the fossil fuel handouts that drive climate pollution. It's time to stop propping up the very industries responsible for fueling the climate crisis and instead fully invest in our clean energy future."

"The CCS tax credit, estimated to cost more than $30 billion over the next decade, overwhelmingly benefits companies that use captured carbon to extract more oil," said Autumn Hanna, Vice President of Taxpayers for Common Sense. "At a time when the costs of climate change-driven disasters are soaring, it's incomprehensible that lawmakers would allow 45Q to become yet another billion-dollar taxpayer subsidy for the oil and gas industry. Congressman Khanna's efforts to ensure federal dollars are spent as intended-on reducing emissions-are essential to better protect American taxpayers.

Cosponsors: Representatives Norton, Bush, Tliab,Chuy Garcia, Grijalva, Ramirez, Huffman, Jonathan Jackson, Mullin, Bowman, Schakowsky, Raskin, Ocasio-Cortez, Frost, Barbara Lee, Barragan, and Brownley.

The full list of organizations that have endorsed the End Polluter Welfare for Enhanced Oil Recovery Act of 2024 include: Our Revolution, Friends of the Earth, Center for Biological Diversity, Progressive Democrats of America, 350.org, Alliance for Affordable Energy, Sierra Club, Greenpeace USA, Climate Justice Alliance, Food & Water Watch, U.S. PIRG, Environment America, Oxfam America, Zero Hour, Oil Change International, Center for International Environmental Law, Evergreen Action, and Taxpayers for Common Sense.

The full text of the legislation can be viewedhere.

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