Thursday, June 6th, 2013

Consistently Opposing Mandates and Subsidies

We have posted a letter that was sent today to select Members of Congress, in which we reiterate our consistent and longstanding opposition to government subsidies of all kinds.

Dear Member of Congress,

On behalf of Koch, I am writing to urge you to oppose the expansion of the Renewable Fuel Standard (RFS) mandate. The RFS mandate previously created by Congress distorts the markets and has resulted in higher costs to consumers. For these reasons, we have consistently supported the full repeal of this RFS mandate and other similar mandates, even when we may benefit from them.

Unfortunately, there are some in Congress that are using attempts to “reform” the RFS as a way to expand this already unworkable and failed mandate.

H.R. 1959, the Domestic Alternative Fuels Act, will expand the RFS mandate by allowing natural gas to qualify as a renewable fuel. Natural gas does not currently qualify as a renewable under the RFS, nor do any other fossil fuels. It simply does not meet the definition of a renewable fuel.The effect of the government allowing natural gas to meet a government mandate and be treated as a renewable fuel will be to artificially create additional demand and increase natural gas costs for both businesses and consumers.

We have seen, time and time again, what happens when the government tries to pick winners and losers in the energy markets. Consumers and businesses lose, and more uncertainty in the economy is created. Natural gas should be priced by the markets, traded in markets globally, and yes, exported if that is its highest value.

Government should not mandate the allocation or use of natural resources and raw materials in the production of goods. An expansion of the mandate would increase the government’s control over the means of economic production. History shows that the free market, driven by consumer choice in the type of energy they use, is a far better way to allocate resources.

We hope you will oppose H.R. 1959 when it is considered in Congress.


Philip Ellender
President, Government & Public Affairs
Koch Companies Public Sector, LLC

A PDF of the letter is available here.

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