The Department of Defense (DoD) is the largest energy consumer in the United States. To meet its energy needs, the Defense Logistics Agency (DLA) executes contracts to purchase fuel and electricity on behalf of the service branches. These contracts present opportunities for the federal government to provide de facto subsidies, should they choose to purchase more expensive sources of energy than is necessary. For the purposes of this report, subsidies are defined as disbursements by the federal government that have an identifiable federal budget impact and are specifically targeted at energy production. If the government pays more than the fair market value for a good or service, particularly in a closed-bidding process, this amounts to a subsidy.
