15 Jul 2011Given the remarkable longevity of the tax credit for ethanol blended into gasoline, it seems fitting that it would take a problem on the scale of the massive US deficit and trillion federal debt to trigger its demise.
Yet despite a widely-publicized Senate vote in June and the announcement of a key compromise among three Senators last week - two from the corn belt and one from the West Coast - it remains unclear just when and how the cancellation of this subsidy will become law. And because the fate of the subsidy is linked to that of the parallel tariff and duty on imported ethanol, the US ethanol industry faces not just the prospect of a more challenging market by year-end, but one that could include competition from foreign suppliers with special advantages under US renewable fuels regulations. Some producers may end up wishing they hadn't expanded output quite so fast.
http://bioenergy.checkbiotech.org/news/ethanols_future_without_subsidies
