Congress is considering moving funding from Big Oil to alternative energy. Right now, one of the ways Big Oil builds on its record profits is to enjoy billions of dollars in tax breaks and subsidies from the U.S. government. However, with gas prices rising, and the summer rally finally underway with crude oil prices, some on Capitol Hill feel that the free ride for Big Oil has gone on long enough. June 19 marks the introduction of a bill that would take $14 billion from Big Oil over 10 years and give it to alternative energy. Not only that, but some Senate Democrats are prepared to start charging royalties from oil and gas drilled in federal waters. Right now, Big Oil gets to drill in government-owned waters without having to pay a dime in royalties, further contributing to profits.
Companies like Exxon (XOM) and lobbying groups like the American Petroleum Institute are protesting, as one would expect. They say that taking money away from oil exploration and drilling in the U.S. increases our energy dependence. Those that support the bill, of course, say that, in the long run, investing in alternative and renewable energy will prove to break us free from foreign oil needs.