WASHINGTON – Friends of the Earth released an analysis today addressing the ethical, environmental and financial implications of a bailout for the fracking industry, which could benefit to the tune of billions from proposed stimulus legislation in both the House and the Senate.
“Financial assistance during public health crises isn’t supposed to rescue failing, dirty industries,” said Lukas Ross, senior policy analyst with Friends of the Earth. “Insolvent frackers shouldn’t get a bailout on the backs of people facing a pandemic. The coronavirus stimulus must put people over profits and ensure that communities, the climate and taxpayers are protected from a fossil fuel bailout.”
The analysis finds that:
- The financial instability of the fracking industry existed long before the coronavirus. At a time of unprecedented emergency, polluters are now poised to benefit from potential bailout funding incoming stimulus bills.
- 27 major fracking companies began the year “in the red” with negative free cashflow (FCF) and have over $26 billion in Total Current Liabilities due in 2020. This includes interest on debt and other pending obligations.
- The two competing stimulus bills in both the House and the Senate need to exclude fracking and the rest of the fossil fuel industry from the “critical industries” eligible for aid.
“Although Speaker Pelosi’s stimulus package is far superior to Leader McConnell’s, neither currently includes the tough language needed to stop a runaway bailout of the fossil fuel industry,” added Ross. The bills in both the House and the Senate need to be improved to exclude fracking and the rest of the fossil fuel industry from eligibility for federal aid.