The debate over U.S. energy policy took a dramatic turn last month when Tesla Motors CEO Elon Musk squared off against the CEO top privately-owned U.S. coal producer Murray Energy.

In an interview for the CNBC show "Squawk Box," Robert Murray called Tesla and its electric cars a "fraud."

He criticized the automaker for failing to turn a profit even while receiving taxpayer subsidies.

DON'T MISS: U.S., China peer-reviewed reports lay out huge subsidies for fossil fuels

Murray went on to say that closing every coal-fired power plant in the U.S. immediately "would not affect the temperature of the Earth at all."

Musk almost immediately fired back with, as is typical for him, a tweet.

He linked to the original CNBC video of the interview, and wrote that the "real fraud going on is denial of climate science."

2016 Tesla Model S

2016 Tesla Model S

He added that Tesla receives far less in subsidies than the coal industry, asking, "How about we both go to zero?"

In the original interview, Murray said Tesla had received "$2 billion from the taxpayer," and that the company has "not made a penny yet in cash flow."

After the interview aired, Tesla announced that it had earned a $22 million profit in the third quarter, its first profitable period since 2013.

MORE: Ending $4 billion U.S. oil, gas drilling subsidies would have low impact: study

Tesla has taken some government money, including a $465 million Department of Energy loan it paid back in 2013.

That loan was part of the Advanced-Technology Vehicle Manufacturing (ATVM) program, which offered loans to other companies, including established automakers Ford and Nissan.

Tesla buyers also qualify for a $7,500 federal tax credit, at least until the automaker hits a ceiling of 200,000 sales that will phase out the credit.

2016 Tesla Model X

2016 Tesla Model X

However, Musk said that his company gets "pennies on the dollar" in subsidies compared with the coal industry.

CNBC noted Energy Information Administration data showing that, in 2013, electricity production and federal utilities that rely on coal received $1.08 billion in direct cash outlays through federal programs, tax benefits, research and development funding, loans, and guarantees.

That amounted to 6 percent of such funding.

In comparison, electricity production from renewable-energy sources received $15.04 billion—or 72 percent of such funding—in the same year.

Ontario Power Generation Nanticoke Generating Station coal power plant

Ontario Power Generation Nanticoke Generating Station coal power plant

A recent reciprocal peer review of subsidies undertaken by the U.S. and Chinese governments found that subsidies for all fossil fuels in the U.S. total $8.1 billion annually.

While he criticized Musk for taking subsidies, Murray also advocated for more government funding of so-called "clean-coal" technologies.

He said increased government subsidies for these technologies would create a "level playing field" with subsidized wind and solar power.

In December 2013, the Department of Energy did offer $8 billion in subsidies for projects to abate or reduce greenhouse-gas emissions from fossil fuels, including carbon capture and storage for coal-fired power plants, according to CNBC.


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