Even in Texas it’s a brave new world for the energy industry

Energy interests of all sizes are poised to defend their share of tax breaks, loan guarantees and other financial incentives amid calls to slash spending both at the state and the federal level.

Concerned that debt-obsession at the federal and state will translate into real cuts, industry groups and their lobbyists are preparing for what amounts to an all-out war, pitting energy resource against energy resource. Their battles should prove to be daunting given that there will probably be no sacred cows when it comes to cutting the billions of dollars in assistance that the government hands out every year.

In his State of the Union speech last Tuesday, Obama cracked a smile as he said, “I don’t know if you’ve noticed, but they’re doing just fine on their own,” repeating the call he’s made the past two years for the elimination of billions of dollars in tax breaks for oil companies.

While that alone would not be enough to cause the industry to break their stride, rumblings from house Republicans lining up their own targets, are probably giving the industry pause. The conservative Republican Study Committee recently outlined $2.5 trillion in spending, tax breaks and subsidies it wants to see cut over the next decade, including billions of dollars in Energy Department research, vehicle, fuels, weatherization and energy efficiency programs.

With so many battlefronts ahead, energy businesses trying to map out investments are probably sweating bullets trying to figure out how to make the case for pending large capital outlays (say for instance – the billions of dollars needed to build a new nuclear power plant which won’t see a return on investment for a decade).

Hoping they will be spared, we can expect energy lobbyists to push back with warnings that messing with the status quo will force lay offs and halt projects that are helping get the economy back on its feet.  

Still, even in a state with as intimate a relationship with the energy industry as Texas, you can’t get blood from a stone.  In the face of a massive budget deficit this legislative session and a constitutionally required balanced budget, you can bet Texas will be looking hard at every dollar it spends and every dollar of revenue it gives up.


By promoting cleaner energy, cleaner government, and cleaner air for all Texans, we hope to provide for a healthy place to live and prosper. We are Public Citizen Texas.