End Polluter Welfare Act of 2025
Sponsors
Legislative Progress
In CommitteeMs. Omar (for herself, Ms. Barragán, Mr. Khanna, Mr. Casar, …
Summary
What This Bill Does
The End Polluter Welfare Act of 2025 comprehensively eliminates federal financial support for fossil fuel production across two major fronts: federal spending programs and the tax code. The bill targets subsidies, tax credits, deductions, and other benefits that currently flow to the oil, gas, and coal industries. It also increases royalty rates on federal lands and introduces new taxes on offshore oil and gas production in the Gulf of Mexico.
Who Benefits and How
Renewable energy companies benefit as their competitors lose tax advantages and federal support, making clean energy relatively more cost-competitive. Federal taxpayers gain from increased royalty payments (raised to 18.75% for offshore drilling), a new 13% severance tax on Gulf production, and elimination of billions in annual fossil fuel subsidies. Environmental and climate advocates see policy aligned with climate goals by removing incentives for fossil fuel expansion.
Who Bears the Burden and How
Oil and gas producers face the greatest impact, losing tax credits for enhanced oil recovery, marginal wells, and intangible drilling costs. They must now amortize drilling expenses over 7 years instead of expensing immediately, pay higher royalties on federal lands, and a new 13% severance tax on Gulf production. Coal mining companies lose percentage depletion, face higher Black Lung Fund taxes (raised 25%), and lose favorable depreciation rules. Multinational energy companies face stricter international tax treatment with foreign oil income now subject to Subpart F and GILTI taxation. Large financial institutions (banks with $10B+ assets, investment companies with $250B+ AUM) lose CERCLA liability protections when lending to contaminated sites. Pipeline operators and MLPs lose their tax-advantaged partnership structure for fossil fuel income.
Key Provisions
- Eliminates 15+ tax incentives including enhanced oil recovery credit, marginal well credit, percentage depletion for oil/gas, immediate expensing of intangible drilling costs, and LIFO inventory for fossil fuel companies
- Raises royalty rates to 18.75% for offshore and onshore oil and gas production on federal lands
- Creates new 13% severance tax on oil and gas produced in the Gulf of Mexico (with credit for royalties paid)
- Terminates federal funding for fossil fuel research (Office of Fossil Energy), loans (DOE Loan Programs, Rural Utility Service), and international development finance for fossil projects
- Ends carbon capture credit (45Q) for all carbon captured after enactment and requires public disclosure of past recipients
- Modifies clean hydrogen credit to exclude "blue hydrogen" from natural gas, limiting it to electrolysis from new renewable sources
- Reinstates EPA methane emissions charge that Congress previously disapproved
Evidence Chain:
This summary is derived from the structured analysis below. See "Detailed Analysis" for per-title beneficiaries/burden bearers with clause-level evidence links.
Primary Purpose
To eliminate federal subsidies, tax incentives, and financial support for fossil fuel production, exploration, and use across federal programs and the Internal Revenue Code.
Policy Domains
Legislative Strategy
"Comprehensive elimination of fossil fuel industry subsidies through two mechanisms: (1) ending federal program support and funding, and (2) terminating tax benefits in the Internal Revenue Code"
Likely Beneficiaries
- Renewable energy industry
- Environmental protection
- Federal taxpayers (reduced subsidies)
- Climate policy advocates
Likely Burden Bearers
- Oil and gas producers
- Coal mining companies
- Natural gas producers
- Petroleum refiners
- Fossil fuel pipeline operators
- Large financial institutions lending to fossil fuel projects
- International financial institutions funding fossil fuel projects
Bill Structure & Actor Mappings
Who is "The Secretary" in each section?
- "the_secretary_of_energy"
- → Secretary of Energy (Section 108, 109)
- "the_secretary_of_treasury"
- → Secretary of the Treasury (Section 107)
- "the_secretary_of_agriculture"
- → Secretary of Agriculture (Section 110, 113)
- "the_secretary_of_treasury"
- → Secretary of the Treasury
Note: The Secretary refers to different Cabinet members in different sections: Secretary of Treasury (107, Title II), Secretary of Energy (108, 109), Secretary of Agriculture (110, 113)
Key Definitions
Terms defined in this bill
Coal, petroleum, natural gas, or any derivative of coal, petroleum, or natural gas that is used for fuel.
Investment companies, investment advisers, or broker/dealers with $250 billion+ in assets under management; or bank holding companies with $10 billion+ in total consolidated assets.
The exploration, development, mining or production, processing, refining, transportation (including pipelines transporting gas, oil, or products thereof), distribution, or marketing of coal, petroleum, natural gas, or any derivative of coal, petroleum, or natural gas that is used for fuel.
We use a combination of our own taxonomy and classification in addition to large language models to assess meaning and potential beneficiaries. High confidence means strong textual evidence. Always verify with the original bill text.
Learn more about our methodology