Congress Must Illuminate the Subsidy for Ethanol Use in Automotive Fuel

C&E News has an article entitled "E15 Controversy" in its August 13 issue. E15 is code for the concentration of ethanol in automotive fuel. Ethanol is presently added to gasoline for a 10% concentration and 90% of the US gasoline market uses this modified gasoline..

A group of ethanol supporters and 54 ethanol manufacturers are organized as Growth Energy. They want to increase the concentration of ethanol in automotive fuel from 10% to 15%. The obvious reason is to increase their business of making and selling ethanol. The group has apparently gained the support of the EPA in that the EPA has approved the increase for certain types of vehicles.

Several objections to this rule change had been registered, including damage to engines, but the most significant aspect has been completely ignored.

Ethanol in automotive fuel got its start through the Clean Air Act passed by Congress more than 30 years ago. When the Clean Air Act was passed, it was thought that there was only a short-term tangible supply of petroleum, and that the United States did not have significant reserves. The Act intended to extend the supply of automotive fuel by addition to gasoline and also to reduce dependence on foreign oil. However, that situation has completely changed. We now know that we have very significant oil reserves in the United States and the only reason we are not developing them is because of inhibition by the present Obama administration.

Ethanol is a more costly fuel than is gasoline, and the only reason for its continued use is that taxpayers subsidies artificially reduce its cost to an acceptable level for fuel. Not only should its use in automotive fuel not be increased, it should actually be eliminated through normal market forces. In other words, the only reason for the continued use of ethanol in automotive fuel is its subsidization by taxpayer dollars. That is equivalent to the old practice of digging holes and filling them in order to make work. It is inefficient and completely unnecessary.

Congress should get on with a modification of the Clean Air Act to eliminate the need for ethanol to be used in 2022 to the extent of 36 billion gallons. It must also completely eliminate subsidies for ethanol used in automotive fuel.