Corn-ethanol subsidies and a tariff against imported cane-based ethanol expire Dec. 31. Porkers in Congress want to renew them in a lame-duck session. The Environmental Protection Agency, meanwhile, is increasing its effective ethanol mandate to 15 percent of gasoline sold at the pump. Congress and the EPA should desist. Ethanol use shouldn’t be ratcheted up, but phased out.
The tax credit for ethanol production is 45 cents per gallon; the tariff on sugar-cane ethanol is 54 cents. These policies have been in place since 1978 and 1980, respectively, when the corn-ethanol industry was new and oil crises increased the demand for nonpetroleum fuel options. A separate Renewable Fuels Standard requires increasing production of biofuels, including ethanol, which is a boon to the industry even without the credit.
The tax credit is a refundable one, meaning government cuts a Treasury check to oil companies for mixing in the ethanol. That cost $7.7 billion last year alone. The tariff keeps out Brazilian cane ethanol or makes gas mixed with it far more expensive. Boosting the ethanol mix is bad news for most cars. By the EPA’s own numbers, an across-the-board switch to a 15-percent ethanol mix would “significantly impair the emissions control technology” of 74 million American cars. Because the mix burns leaner than gasoline, it leads to higher exhaust temperatures, misfires and catalytic-converter damage.
Two independent studies published in the journal Science in 2008 showed that converting land to ethanol production would produce twice as many purported greenhouse gases as using regular gasoline. Diverting corn for ethanol use drives up prices for corn-based foods and meat from livestock fed mostly on corn.
Environmentalists who spent years pushing ethanol are now rallying against it. Friends of the Earth, for example, has organized a coalition to oppose extension of the credit. On Nov. 22, while living it up at an environmental conference in Greece, Al Gore joined the fray, countermanding his former dogma that ethanol use is a moral imperative. “First generation ethanol I think was a mistake,” he confessed. “The energy conversion ratios are at best very small.” Then Big Al cut to the political chase: “One of the reasons I made that mistake is that I paid particular attention to the farmers in my home state of Tennessee, and I had a certain fondness for the farmers in the state of Iowa because I was about to run for president.”
Supporters of ethanol subsidies always put politics ahead of science and economics. The rest of us shouldn’t have to pay for it.