The Ethanol Mud-Rasslers Reach for the Manure
by Jim Lane (Biofuels Digest) …Two new data points have been introduced. A Congressional Budget Office report on the ethanol tax credit, and a report from Bruce Babcock et al at Iowa State, funded by UNICA, suggesting that elimination of the ethanol tariff and the tax credit will have almost no impact on ethanol production.
In the US, there’s a lot at stake in terms of energy policy. Globally, there’s more at stake: the integrity with which the debate over renewable energy is being conducted.
Let’s put those studies in context.
…The Digest: Ah, note that the change will “shift the burden” from taxpayers to consumers and blenders who are, uh, taxpayers. The study does not say that the cost of producing ethanol, or fossil fuels that replace additional ethanol, will go down. Simply that the burden for producing energy will shift. That’s not quite the same thing as a savings.
…Here, from John Plaza at Imperium Renewables:
“ In total, the U.S government has invested $80 billion of taxpayer money on coal fired plants. It has contributed $72 billion to create the nation’s hydroelectric dams and $63 billion for nuclear facilities. It has invested billions more to create a national network of highways…Had these historic projects been subjected to the same kind of simple cost analysis as the CBO used for biofuels, they never would have been built – and millions of Americans wouldn’t be enjoying the benefits of those investments – low costs for power, a national grid and a robust, interconnected national highway system.”
“The CBO also ignored data showing that every dollar of subsidy invested in biofuels returns more than two dollars in increased Gross Domestic Product and state and federal tax revenue. Most distressing is the admission by the authors that the report ignores several positive taxpayer benefits, including that ‘increased production of ethanol has probably resulted in some reduction in the price of gasoline, an increase in farm incomes and some impact on the quality of the nation’s air and water resources.’”
“Merrill Lynch estimated in 2008 that the availability of ethanol effectively reduced the cost of petroleum by 15 percent. Using a low estimate of 20 cents per gallon and a high estimate of 61 cents per gallon, the availability of ethanol is estimated to save each American household between $210 and $642 per year. How can this not be factored into the CBO analysis?” READ MORE and MORE (Advanced Biofuels USA) and MORE (Iowa Study) and MORE (CBO Study)
Related posts:
- Global Ethanol Production to Reach 85.9 Billion Litres in 2010: Global Renewable Fuels Alliance Releases 2010 Biofuels Production Forecast
- Costs and Benefits to Taxpayers, Consumers, and Producers from U.S. Ethanol Policies
- Baylor Professor Turning Cow Manure into Fuel-Grade Ethanol
- Implications Of The U.S. Ethanol Tariff
- The Mad Scramble over the Ethanol Tax Credit
