Summary: Soaring prices for corn and other grains have made it tough for Congress to mandate greater use of biofuel. As of 2005 and much to the satisfaction of farm lobbyist and environmental groups, Congress required oil refiners blend 7.5 billion gallons of renewable fuel by 2012. This served as a major catalyst for the ethanol industry. However, production has now closed in on the 7.5 billion gallons and producers of biofuel, along with corn farmers, are lobbying for Congress to raise the requirement again. While there is some legislation being considered to raise the requirement, opposition has begun to mount. For example, the price of corn-based animal feed is up 60% since 2005 and ‘barnyard’ lobbyists (aka cattle farmers, etc.) are showing signs of resistance. The debate now centers on if the advantages of biofuel outweigh the disadvantages associated with the rise in corn prices. The Agriculture Department reports prices at groceries and restaurants could increase by as much as 4.5% this year alone.
My Take: This is one topic I have been fairly outspoken on since Bush covered it in his State of the Union address this year. I am very much against the government supporting one form of alternative energy over another. While I have (in the blog actually) called for government intervention in the fight against global warming, I would like to see the government enable the alternative energy industry as a whole (along with what is called ‘geo-engineering’). In terms of any plan for supporting ethanol directly, we are already seeing the unfortunate side affects. Corn tortillas or flatbread, the main source of nourishment for impoverished Mexico City inhabitants, has become completely unaffordable due to the rising price of corn. This is just one such instance and we are seeing the effect here in the U.S. also, as this article pointed out. We should not endorse one form of alternative energy just because lobbyist groups (aka farmers) are calling for it. Beyond that, I have yet to read that ethanol-based fuel will ever be cheap or more importantly, will actually reduce greenhouse gas emissions significantly. I would be more than willing to pay a 5% tax on my food and meals IF that meant we were doing something effective to offset global warming. Finding a new alternative to keep farmers in this country healthy and wealthy does not appear to do this. Bottom line, you cannot win the argument for ethanol from an environmental or economical standpoint.
Check out the article here
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