March 29, 2007

A bit of common sense from our government

UPDATED -- see bottom of post No really! From Reuters:
Corn is not the future of U.S. ethanol: DOE
New technology to make ethanol from crops such as grasses and trees instead of corn could ease price spikes of the grain within a decade, a U.S. Energy Department official said on Wednesday.

"I'm not going to predict what the price of corn is going to do, but I will tell you the future of biofuels is not based on corn," U.S. Deputy Energy Secretary Clay Sell said in an interview.

Output of U.S. ethanol, which is mostly made from corn, is expected to jump in 2007 from 5.6 billion gallons per year to 8 billion gpy, as nearly 80 bio-refineries sprout up.

Corn prices have doubled over the last year as the Bush administration, seeking to reduce oil imports while boosting output of fuels believed to cut greenhouse gas emissions, offers millions of dollars in incentives to boost ethanol production.

The corn prices, the highest in a decade, have spurred thousands of people in Mexico to protest over the price of tortillas, a national staple made from corn. The spike has also lead to worries that meat and dairy prices could eventually rise.

Sell said the future of biofuels is cellulosic ethanol, made from microbes that break down woody bits of non-food crops into sugars that can be fermented into fuel.

Cellulosic, and other new biofuels such as biobutanol, which can be made from petroleum as well as biomass, could begin to feed the commercial fuel market within six to 10 years, he said. They could also be part of a larger program to cut greenhouse gases, he added.
I would like to know who it was who spearheaded the subsidies for corn ethanol -- they were blind to the effects of this and are responsible for a lot of high food prices, especially basic staples that the poorer people depend on. UPDATE: Reader Al was kind enough to post a comment letting me know that the Ethanol subsidy came from Senators Tom Daschle (Democrat-S.D.) and Tom Harkin (Democrat-Iowa) right around 2002. Info is here: FindArticles (watch out for the pop-ups)
Taxpayer subsides cause crop overproduction, leading to more subsidy schemes, like biofuels - Dick Lugar, United States Senator
Proponents of "biofuels" mandates and subsidies -- including ethanol and biodiesel -- partly justify their pitch by claiming consequent reductions in huge surpluses of soybean oil or corn stocks and consequent higher prices for farmers, along with some dubious claims about reduction in foreign oil dependence.

But now comes U.S. Sen. Dick Lugar (R-Indiana), himself a part-time corn and soybean farmer, calling these chronic, growing, gigantic taxpayer subsidies for endless farm program cycles a "charade."

Writing for a column in the New York Times last month, Lugar blasted the ending U.S. Senate farm bill sponsored by Sens. Tom Daschle (D-S.D.) and Tom Harkin (D-Iowa), both from big-corn states and both big backers of "biofuels" mandates and subsidies.

This bill would give a whopping $171 billion in subsidies to corn, soybean, wheat and rice farmers, along with huge payments to milk, sugar and peanut producers.
Emphasis mine. $171 Billion Dollars in subsidies -- Mmmmmm -- that sure is some gooood pork! Posted by DaveH at March 29, 2007 7:48 PM