The Senate likes ethanol slightly less than it used to
For years, Washington has been really gung-ho about putting corn (America’s crop!) into cars (America’s bikes!), and has supported corn ethanol production with a suite of subsidies. But now senators are ready to say: “With food prices rising, we're not so comfortable with that! Maybe people should eat the corn instead, in the form of some kind of high-fructose syrup.” Yesterday, the Senate passed a measure that would end a 45-cent-per-gallon tax credit for ethanol producers.
What’s crazy about this is that, unlike most cuts to alternative energy, this was not a Republican-only party. The yea votes came from 33 Republicans and 38 Democrats. What really mattered was how many votes you needed from farmers. Most of the opposition to the credit cut came from Midwestern senators.
The measure might not even make it into law; it's attached to a bill that has only a so-so chance of survival. But the vote is being widely touted as a end to ethanol's run as D.C.'s golden renewable energy child — even though oil refiners are still required to process increasing amounts of ethanol, and the Senate also voted yesterday to keep in place subsidies for installing ethanol pumps and storage tanks.