I’d love to know who voted for this waste of money, and who of that group is still in Congress...especially on the R side of the aisle.
Obviously, the corn industry didn’t make a big enough donation to candidates, and now the politicians are teaching it a lesson.
Hey, just because the economy is bad and your business is hurting is no reason to cut back on your political donations.
BTW, I was in South Dakota a couple of years ago and noticed they had “flex fuel” gas (very high alcohol content) for well over a dollar less than regular. I did some math regarding the energy content of alcohol vs gasoline and the percentage of alcohol in the fuel and determined it was still cheaper to buy the “expensive” gasoline because of the significantly better mpg I could expect.
And if this subsidy goes away, I have a feeling flex-fuel will too, unless people will really be willing to pay more for significantly less energy.
All in all, this is a VERY good development.
I believe that the EPA has control over at least part of the mandate. The EPA will allow (require?) 15 percent ethanol content in 2011. Originally the EPA required ethanol usage as a replacement for MTBE. Congress passed a law with huge biofuel mandates in 2005 and increased in another law in 2007. I doubt that Congress will repeal the mandates although the mandates are absolutely preposterous.
I hope it ends too but here many distributors (jobbers?) are ignoring it anyway. My chemical test kit has not detected ANY blended ethanol lately.
While we are at it, reduce the diesel fuel standards to pre-2007 standards, relax the emissions standards for large trucks, and exempt the military from emissions standards.
The subsidy is included in the American Jobs Creation Act of 2004 and is called the Volumetric Ethanol Excise Tax Credit. The mandate was included in the Energy Policy Act of 2005. So no, the subsidy and the mandate are seperate. FYI The Renewable Fuels Reinvestment Act, RFRA, was introduced in 2010 by Congressman Earl Pomeroy (D-ND) and and John Shimkus (R-IL) and would extend the tax credits set to expire on 31 December 2010. I hope they get kicked out asap.