Koch Brothers' Anti-EV Group will Fail--Big Time

Jim Motavalli

Jim Motavalli | Feb 22, 2016

Stop the presses! The Koch Brothers don’t like subsidizing electric cars!

A lot of Americans (and the auto industry, too) won't like a pair of billionaires taking away their EV subsidies. (DonkeyHotey/Flickr)The brothers’ interest in keeping the oil pumping and cars running on gasoline is pretty clear. The Koch company’s Flint Hill Resources “operates refineries in Minnesota and Texas with a combined crude oil processing capacity of more than 600,000 barrels per day.” Koch Pipeline Company “owns or operates more than 4,000 miles of pipelines that transport crude oil, refined petroleum products, natural gas liquids, and chemicals,” the company says.

The brothers are targeting the 2016 elections with $889 million, so what’s an additional $10 million or so annually to try and stop subsidies for EVs (and promote gasoline as a fuel)? The disclosure that such a group is planned was revealed at Huffington Post last week.

“A Koch Industries board member and a veteran Washington energy lobbyist are working quietly to fund and launch the new advocacy outfit,” Huff Po said. “Once launched [by this spring or summer], the new group is expected to use paid and earned media to push its pro-petroleum transportation messages.”  

The board member is James Mahoney; the lobbyist Charles Drevna, former head of the American Fuel and Petrochemical Manufacturers.

Governments are investing heavily in electric charging infrastructure--and the cars, too. (Marlordo59/Flickr)Here’s my prediction: The group, whether it’s called Citizens for Petroleum or the Oil Transportation Coalition, is going to fall flat on its face. There’s plenty of precedent for it.

The Koch brothers are vulnerable on the issue because of the massive subsidies the oil industry, including their own companies, receive every year. Elon Musk, whose first reaction to the Koch disclosure, was to tweet a link and the word “Sigh,” followed up by noting that $5 trillion in annual oil subsidies worldwide “is def right order of magnitude.” Good Jobs First estimates that Koch companies have taken $196 million in local, state and federal subsidies since 1990. I’m sure Koch would defend its policy of taking government money by citing a famous column in which Charles Koch staked out his common ground with Bernie Sanders and said that “Koch Industries opposes all forms of corporate welfare—even those that benefit us. (The government’s ethanol mandate is a good example. We oppose that mandate, even though we are the fifth-largest ethanol producer in the United States.)”

Koch may have taken that stand publicly, but he isn’t creating lobbying groups to oppose petroleum subsidies. Instead, it funds a huge array of conservative think tanks, including many that take Koch-favorable stands on energy issues. And one of those, now defunct, is the Global Climate Coalition. Two Koch family funds, the David H. Koch Charitable Foundation and the Claude R. Lambe Charitable Foundation provided $100,000 and $29,460, respectively. The money was wasted, and it’s key to why I think this new group will fail.

Iowa loves ethanol subsidies.Here’s the sordid history. The Global Climate Coalition (GCC) was formed in 1989 by the National Association of Manufacturers. Its goal: to refute the science behind global warming. In that task, it initially had the enthusiastic support of auto companies, including the Big Three, Ford, General Motors and what was then DaimlerChrysler.

Andrew Revkin reports:

The coalition was financed by fees from large corporations and trade groups representing the oil, coal and auto industries, among others. In 1997, the year an international climate agreement that came to be known as the Kyoto Protocol was negotiated, its budget totaled $1.68 million, according to tax records obtained by environmental groups.

But after GCC got a lot of attention as a “club for polluters” with no scientific credibility (and the Union of Concerned Scientists compared it to the industry-supported Tobacco Institute), the defections started. Auto companies were building their green images, and denying the reality of climate change was conflicting with that. Beginning in 1999, the auto members withdrew one by one. GCC disbanded in 2001.

Citizens for Petroleum, or whatever the name, won’t have even the initial support of the auto industry. The companies are desperately trying to comply with federal fuel economy laws, which require fleets to reach 54.5 mpg by 2025. To meet that goal, they need consumers to buy electric cars—big time.

Wade Newton, a spokesman for the Auto Alliance, representing 12 automakers tells me this:

Automakers are facing a zero-emission vehicle (ZEVs) mandate in California and nine other states–-which together represent about a third of all U.S. auto sales.  By 2025, these states require that over 15 percent of new car sales be ZEVs.  The continuation and growth of appropriate incentives, both monetary and non-monetary, will be critical.

Elected officials trying to pull EV subsidies would encounter a blizzard of enmity from consumers across the political spectrum. Conservatives drive Leafs and Volts, too. And the fact that its funders are likely to include multiple oil companies (all getting big subsidies) is further going to blunt its message.

Look at the Iowa primary, where the candidates (except Ted Cruz; who showed his support in other ways) had to genuflect to ethanol subsidies. The Koch brothers may oppose those corn industry giveaways, but even the politicians taking their money had to kiss the ethanol blarney stone.
The anti-EV group isn’t even born yet, and I’m already predicting its demise. Inside the Koch bubble, it probably sounds like a good idea, but—trust me on this—it isn’t.

The Koch brothers, by the way, sometimes send out mixed signals. Over a year ago, Koch representatives met in Washington with Securing America’s Future Energy (SAFE), which is dedicated to reducing our oil dependence. “We talk to everyone across the political spectrum,” spokeswoman Ellen Carey told me. Here's some relevant video:

 

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