A new report from the National Center for Energy Analytics (NCEA) finds that 90% of subsidies for the energy sector in 2025 went to renewable energy. The analysis also shows that oil, gas and coal industries’ subsidies come mainly in the form of tax expenditures as opposed to direct subsidies.
Using data from the Department of the Treasury, Paul Tice, senior fellow with the NCEA, calculates that in fiscal year 2025, explicit government subsidies in the form of tax expenditures for the entire energy sector totaled $64.1 billion. This was more than all other domestic industries. The NCEA was created by The Texas Public Policy Foundation as a national energy think tank.
The total fossil fuel-related tax expenditures came to $2.6 billion in revenue losses for the federal government in fiscal year 2025.
By comparison, the total amount of federal tax money subsidizing renewable energy, electric vehicles and energy-efficient equipment in fiscal year 2025 was $57.9 billion, which exceeds the total for fossil fuels over the entire fiscal year 1994-2025 period, according to the report.
Disputing other reports
The analysis disputes claims from other sources that “Big Oil” is gobbling up trillions of dollars in subsidies every year. The International Monetary Fund pegs the global figure at $7 trillion. A report in September from the climate advocacy nonprofit Oil Change International estimated that oil, gas and coal in the U.S. receive approximately $34.8 billion per year.
“This yearly figure continues a decades-long escalation of public support for the fossil fuel industry, despite the trillions in profits accumulated by the oil and gas industry and a laundry list of harms caused by fossil fuels to the residents of this country and the globe,” the Oil Change International report claimed.
The report doesn’t argue that the subsidies for the energy industry are problematic. Instead, the report demands that the subsidies going to fossil fuel companies should be redirected to social services and wind and solar development.
“We’re paying $35 billion per year to prop up a polluting, expensive energy system instead of investing our public money into clean, affordable renewable energy. Congress must stand up to Big Oil and Gas, eliminate fossil fuel subsidies, and redirect those billions toward the things our communities actually need: healthcare, housing, and clean, affordable, renewable energy,” Collin Rees said in a statement.
