IRS Grants $370 M Tax Credit to Cheniere Energy
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- Cheniere Energy requested alternative‑fuel tax credits for the boil‑off gas used to power its LNG vessels, a move that shipping experts say is not truly an alternative fuel.
- The IRS approved a $370 million payout to Cheniere Energy for those tax credits, a windfall that was predicted by an Inside Climate News investigation earlier this year.
- Seven Senate Democrats have opened a probe into the controversial tax credits and the $370 million benefit to Cheniere Energy.
- Shipping experts argue that using the credits for LNG vessel fuel provides little climate benefit compared with diesel.
- Tax specialists note that the way Cheniere is using the alternative‑fuel credit was never intended by the tax code.
- Phil McKenna and Peter Aldhous detailed the complex calculations they used to estimate the payout and placed the case within a broader look at hidden climate costs of LNG exports.
Why it matters: Cheniere Energy gains a $370 million windfall, while taxpayers and climate advocates lose as the credit subsidizes LNG vessel fuel with minimal emissions benefit; the Senate investigation scrutinizes the credit’s legality and climate impact, and highlights the gap between tax policy intent and actual use.
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