All eyes were on Iowa this weekend for the Iowa Agriculture Summit, with speculation flying around whether presidential hopefuls would bow to the pressure of Big Ethanol.
Proponents of the ethanol mandate promised Americans that their plan would save the environment; but 10 years later, America’s premier “environmental” policy is actually doing more harm to the environment than good.
Ethanol proponents have long claimed that advanced (cellulosic) biofuels will replace corn ethanol, resolving the emissions and hunger problems that corn ethanol causes. And yet, despite government mandates and subsidies, cellulosic biofuels are still not produced at any commercial scale.
Agrichemical companies mint fortunes by selling seeds and chemicals to farmers, and grain processors reap billions from buying crops cheap and turning them into pricey stuff like livestock feed, sweetener, cooking oil, and ethanol. But the great bulk of US farms are run by independent operators.
The Renewable Fuel Standard (RFS) is one of the few policies that has bipartisan support for reform and with your help, we can urge Congress take action on this failing mandate.
Today, we divert more than 40 percent of our corn crops to ethanol. Further, government has been subsidizing “gasohol” for years. In 1979, the going rate was 40 cents per gallon of E10. And the final lesson is this: we’ve been hoping for cellulosic biofuels forever.
In its zeal to impose the ethanol boondoggle, Congress has mandated it, subsidized it, and protected it from competitors. Now some Senators are siccing prosecutors on those who still won't get on their ethanol corn-wagon.
The corn-based fuel has long been subsidized by the government, which should rankle Republicans. It's worse for the environment than gasoline, which should irk Democrats. And ethanol has been shown to drive up food prices, because farmers are devoting more acreage to corn for fuel instead of food.
The demand for feedstock oils from food and non-food plants, bushes and trees to feed the biodiesel thirst has imposed huge costs in terms of deforestation, land abuse and decreased water quality on those countries supplying the feedstock for biodiesel.
Big Corn and Big Oil are now battling over the fate of the ethanol mandade. The oil industry wants the ethanol requirement reduced or repealed altogether. The corn lobby wants to preserve the mandate, along with the hefty subsidies paid to producers of renewable fuels.
The result of the ethanol mandate, oil companies argue, is a “blend wall” that inevitably translates into higher gasoline prices for consumers, since oil firms have to buy special credits to make up for missing the law’s blending targets.
As the federally-mandated volume of ethanol usage increases and motor fuel consumption declines, to avoid lawsuits, gasoline refiners must purchase federal renewable "credits" to make up for the ethanol they don't blend, causing higher gasoline prices even in periods of lower demand.
Anticarbon central planning was bound to distort markets, but it turns out that the planners often increase emissions as they try to engineer President Obama's "new energy economy."
The 2007 federal law mandating ever-greater ethanol consumption remains on the books, and it is starting to create the economic equivalent of a multi-car freeway pileup.
The original law mandated the use of one billion gallons of cellulosic fuel in 2013. This may have been the worst government forecast in history. Even with taxpayer subsidies, total cellulosic volume in 2012 was about 20,000 gallons. The government was off by a mere 99.9%.
Industries as wide-ranging as oil refiners, biofuel manufacturers, chain restaurants and chicken farmers sparred over the future of the federal ethanol mandate Tuesday.
The ethanol in our gasoline increases the cost to fill our cars, is heavily subsidized by taxpayers and has considerable environmental drawbacks.
The nation’s consumption of gasoline is falling and refiners say they can only replace 10 percent of their main gasoline blend with ethanol. Ten percent of the nation’s expected 2013 gasoline consumption 13.3 billion gallons, a volume of ethanol that would fall within the mandate this year.
In years when ethanol producers make more ethanol than the mandate requires, they generate a surplus of Renewable Identification Numbers, or RINs. They can bank those for the next year. Before 2012, when ethanol subsidies stopped, producers built up a surplus of RINs; part of that surplus remains.
Nearly 10 percent of the nation’s ethanol plants have stopped production over the past year, in part because the drought that has ravaged much of the nation’s crops pushed commodity prices so high that ethanol has become too expensive to produce.
Dan Dicker tells Jim Cramer how the ethanol program is destroying itself with by subsidizing foreign companies and spiking gas prices.