Home > Uncategorized > Pioneers in gas drilling say government research and tax breaks helped launch boom – The Washington Post

Pioneers in gas drilling say government research and tax breaks helped launch boom – The Washington Post

September 24, 2012 Leave a comment Go to comments

The first federal energy subsidies began in 1916, and until the 1970s they “focused almost exclusively on increasing the production of domestic oil and natural gas,” according to the Congressional Budget Office.More recently, the natural gas and petroleum industries altogether accounted for about $2.8 billion in federal energy subsidies in the 2010 fiscal year and about $14.7 billion went to renewable energies, the Department of Energy found. The figures include both direct expenditures and tax credits.Congress passed a huge tax break in 1980 specifically to encourage unconventional natural gas drilling, noted Alex Trembath, a researcher at the Breakthrough Institute, a California nonprofit that supports new ways of thinking about energy and the environment. Trembath said that the Department of Energy invested about $137 million in gas research over three decades, and that the federal tax credit for drillers amounted to $10 billion between 1980 and 2002.The work wasn’t all industry or all government, but both.One step at a time, the problems of shale drilling were solved. Crawley said Energy Department researchers processed drilling data on supercomputers at a federal lab. Later, technology created to track sounds of Russian submarines during the Cold War was repurposed to help the industry use sound to get a 3-D picture of shale deposits and track exactly where a drill bit was, thousands of feet underground.“It was a lot of pieces of technology that the industry thought would help them. Some worked out, some didn’t,” Crawley said.Renewable energy has had similar fits and starts, plagued by the costs and complexities of developing technology, and markets for it.The idea that the government can help industry achieve advances that the private sector can’t or won’t has been a central contention of the presidential election. President Barack Obama’s comment this summer that Republicans seized on — “If you’ve got a business — you didn’t build that” — was part of broader comments about infrastructure, education and other public spending that indirectly helps businesses.Both Obama and Republican presidential nominee Mitt Romney tout the benefits of shale gas, but they differ over the government’s role in subsidizing energy research. Obama has suggested continued funding for renewable energy but also eliminating billions of dollars in subsidies for oil and gas companies. Romney calls that an unhealthy obsession with green jobs — and has vowed to cut wind power subsidies, yet keep federal support for ethanol.

via Pioneers in gas drilling say government research and tax breaks helped launch boom – The Washington Post.

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