(This is the second of three columns about fossil fuel subsidies covering B.C. royalty, direct and indirect subsidies.)

The fossil fuel industry in British Columbia received $765.3 million in subsidies in 2020-21.

The subsidies point to a pattern of public spending that runs counter to both the goal of B.C.’s climate policies and the larger social imperative to undertake meaningful climate action.

The vast majority of these subsidies go to natural gas producers. Royalty reductions and credits are available to fossil fuel producers in B.C. through allowances, exemptions, credits and lower royalty rates (see below).

Reduced royalty programs are designed to address situations where costs are not covered by existing oil and gas royalties. Those programs reduce royalties that companies pay to the government, thereby encouraging fossil fuel exploration, development and production in higher cost environments.

The largest is the Deep-Well Royalty Program, which provides royalty credits to companies that drill deep wells, usually by fracking. According to budget documents, the B.C. government plans to continue expanding the credit to $657 million in 2023-24.

Worth more than $100 million in 2022-23, the second biggest publicly funded fossil fuel windfall is the Clean Growth Infrastructure Royalty Program, which........

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