Fossil fuel companies participated in the government’s Paycheck Protection Program to bail out small businesses at far higher rates than companies in other key sectors, a new BailoutWatch analysis has found. It’s another sign that coal, oil, and gas companies now pleading distress from the pandemic were already limping along.
About 11.3% of the companies in key fossil fuel industry groups, including drilling and mining, took the money, according to data released last week by the Small Business Administration. By comparison, only 2.7% of green energy companies and 5.8% of durable goods manufacturers got money through the program. (Durable goods are consumer products like cars and appliances that are expected to last for more than three years.)
Most companies that applied for the program ended up being approved. Only 4% of small businesses that sought relief did not receive it, according to the U.S. Census Bureau’s Small Business Pulse Survey. Along with the higher participation rate, this suggests that fossil fuel companies were far likelier to seek bailouts than companies in the other sectors.
(The above graphic compares the portion of the fossil fuel industry, including mining and drilling, that received PPP loans to the portion of the clean energy and durable goods industries that received PPP loans, as of July.)
BailoutWatch previously identified more than 6,000 firms directly involved in the fossil fuel business as having received loans between $150,000 and $10 million each from the program. Dozens of them were charged with violating rules about pollution, worker safety, and government contracting.
A later analysis found that fossil fuel companies were more likely to receive the biggest bailouts, yet they accomplished less to advance the program's core goal of stemming unemployment.
The Small Business Administration released the names of some companies that participated in its Paycheck Protection Program earlier this month. The program, part of the $2.2 trillion CARES Act coronavirus emergency package, is designed to cover small business' payrolls to ease the effects of the current recession. In order to keep the money, companies have to use it on payroll or other core expenses.
As the SBA reported loan sizes in broad categories, it's impossible to say exactly how much any one company received.
The government is implementing numerous other programs, including financial bailouts and rule rollbacks, that will benefit fossil fuel companies under the guise of pandemic assistance.