If the latest rumblings out of Washington, D.C., are any indication, the future of American ethanol energy is in peril.
Agriculture.com recently interviewed one of the leading supporters of ethanol on Capitol Hill, Sen. Chuck Grassley (R-Iowa), who was stoic when talking about the future of the alternative energy source. “If we go in divided, we’re going to be very, very weak,” Grassley said, adding, “and I think we’re in a weaker position than we’ve been in for a while.”
Being in a weak position at this juncture is particularly concerning to ethanol supporters. The 45 cents per gallon tax break for ethanol fuel is set to expire at the end of 2011; so too is a tariff on imported ethanol. At a time when Republicans and Democrats are trying to appease voters by trimming the budget, federal assistance to the ethanol industry looks like an easy place to start cutting.
For the last several months, the EPA has been moving toward approving a higher blend of ethanol, known as E85, for use in most new vehicles in the United States. At every decision point, the EPA has faced opposition from lobbying groups in the food and agriculture sector as well as the fossil fuel sector. Those are big sectors, and having them on the opposite side of your argument is bad news. This explains Grassley’s pessimism, but underscores that his pessimism may be realistic. So, come 2012, corn may be back to being found on our plates and not in our gas tanks.