HR 4714119th CongressIn Committee

End Polluter Welfare Act of 2025

Introduced: Jul 23, 2025

Sponsor: Rep. Omar, Ilhan [D-MN-5] (D-Minnesota)

Economy & TaxesEnvironment & Climate

Standard Summary

Comprehensive overview in 1-2 paragraphs

The End Polluter Welfare Act of 2025 is a broad package aimed at eliminating a wide array of federal supports, subsidies, and favorable tax treatments for fossil fuels. The bill would raise or remove royalty relief and reduce or terminate various government programs that currently subsidize oil, gas, and coal production. It also revamps or repeals many fossil-fuel-related tax provisions, eliminates recent fossil-fuel subsidy legislation, and imposes new or expanded costs (including a severance tax on Gulf of Mexico offshore oil and gas). In addition, it would abolish the Department of Energy’s Office of Fossil Energy and Carbon Management, restrict international financing for fossil-fuel projects, and curb federal funding for fossil-fuel research and development. The overall aim is to shift federal fiscal policy away from supporting fossil fuels and toward reducing pollution and funding cleaner energy technologies. If enacted, the bill would likely raise the operating costs and reduce the profitability of fossil-fuel producers, lenders, and related entities, while potentially increasing government revenue and accelerating reforms in energy markets and climate-related policies. The package also signals a step toward a more aggressive posture on decarbonization by removing many incentives for fossil fuels and constraining public funding for fossil-energy activities.

Key Points

1Elimination and overhaul of fossil-fuel subsidies and royalty supports
2- Repeals or tightens royalty relief and adjusts royalty rates on offshore and onshore fossil-fuel leases (e.g., higher rates and no royalty relief going forward).
3- Increases certain royalty percentages under the Mineral Leasing Act and the Outer Continental Shelf Lands Act after enactment.
4- Ends or restricts various subsidy-like provisions tied to fossil-fuel production.
5Termination or drastic reduction of fossil-energy government programs
6- Termination of the Office of Fossil Energy and Carbon Management within the Department of Energy; rescission of unobligated funds and prohibition on new funding for that office except for winding down ongoing work.
7- Prohibition on using Loan Programs Office funds for fossil-fuel projects (with an exception for qualified clean hydrogen).
8- Prohibition on funding fossil-fuel activities through ARPA-E, USDA carbon capture programs, and certain energy-innovation incentives.
9Restrictions on international and federal funding for fossil fuels
10- Restrictions on use of funds by international financial institutions (including U.S. contributions) to support fossil-fuel projects; rescission of unobligated funds tied to fossil-fuel activities; future contributions conditioned on not financing fossil fuels.
11- Prohibition on using U.S. agency funds (DFC, Ex-Im Bank, TDA, USAID, MCC) to support fossil-fuel production or use.
12Transportation and liability changes
13- DOT funds and grants cannot directly support rail facility or port projects that transport fossil fuels.
14- Expands liability under CERCLA to ineligible lenders (as defined by larger asset managers and bank-holding companies) in certain circumstances, increasing risk for some lenders tied to fossil-fuel activities.
15Repeal of recent fossil-fuel subsidy laws
16- Repeals or reverses various provisions from recent fossil-fuel subsidy laws (e.g., provisions in the Inflation Reduction Act and related measures).

Impact Areas

Primary group/area affected- Fossil-fuel producers, refiners, coal and oil/mineral companies, and their lenders and investors. The bill would raise royalty costs, remove many tax incentives, and restrict access to federal funding for fossil-energy projects.Secondary group/area affected- Federal government budget and revenue: more revenue from curtailed subsidies and higher royalty rates; potential changes in budget allocations due to redirected funding away from fossil energy toward other energy priorities or environmental programs.- Financial institutions and capital markets: tighter or new liabilities for certain lenders under CERCLA-related provisions; reduced opportunities for government-backed financing of fossil projects.Additional impacts- Research, development, and clean-energy programs: significant reductions or restrictions on DOE fossil-energy offices, ARPA-E, USDA carbon capture, and related clean-energy incentives, potentially accelerating or reshaping the federal push toward non-fossil energy technologies.- International finance and diplomacy: U.S. contributions to international financial institutions would be conditioned or restricted with respect to fossil-fuel projects, affecting global energy financing and climate-related aid.- Environmental and public health: by eliminating subsidies and increasing costs for fossil-fuel production, the bill could contribute to reduced fossil-fuel consumption and lower pollution levels in the longer term.Royalty relief: exemptions or reductions in royalty payments that fossil-fuel producers would otherwise owe to the government for extracting natural resources on public land or offshore.CERCLA: the Comprehensive Environmental Response, Compensation, and Liability Act (a.k.a. Superfund), which governs cleanup of contaminated sites and the liability of responsible parties.Ancient and new tax provisions: the bill repeals or modifies numerous tax credits, deductions, and depreciation rules tied to fossil fuels, aiming to reduce tax advantages for fossil-energy activities.Offshore/OCS: refers to offshore drilling and extraction on the Outer Continental Shelf (federal waters).

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