When you fill up your gasoline tank, chances are you will see a tag that says the fluid you are pumping contains 15 percent ethanol, mostly from corn. If you find that confusing you are in good company.
While the federal government promotes ethanol, the U.S. Environmental Protection Agency says the 15 percent mixture should be used only in model year 2001 and newer cars, light-duty trucks and medium-duty passenger vehicles. It has proposed a new rule barring the use of gasoline containing more than 10 percent ethanol in older cars, heavy trucks, motorcycles and nonroad engines.
Evidently, the EPA thinks too much ethanol can be harmful. The automakers opposed an earlier increase mandated by EPA from 10 percent to 15 percent, and the House has voted to block it until October.
The farm lobby backers of the multibillion-dollar ethanol industry brag that it is cheaper than gasoline, cleans out your engine, cuts back on oil imports and combats global warming. Opponents, including the food and cattle industries and some conservative political leaders, say it costs more than gasoline, can damage your engine, raises the cost of food and harms the environment by using more cropland and adding carbon dioxide to the atmosphere through ethanol production.
An ethanol fad took off in the late 1900s, although Henry Ford used it in his Model Ts until he found that gasoline was cheaper. Environmentalists backed it and corn farmers profited enormously. Agribusiness giants including Archer Daniels Midland, with generous help in taxpayer dollars, used 40 percent of the national corn crop in 2010 to make 50 billion liters of the alcohol fuel, up from only 13.6 billion liters in 2005, according to Scientific American.
The ethanol lobby met its match earlier this year when group of senators including Diane Feinstein, a California Democrat, and conservative Republicans agreed to roll back the government subsidies, tax credits and a tariff on imported ethanol for a savings that Sen. Feinstein said would reduce the federal deficit by $1.33 billion. But a later bill, supported by the ethanol lobby, handed most of the tax savings to other ethanol subsidies such as tax credits for small ethanol producers and for ethanol pumps at gas stations.
And that left in place a 2007 mandate that required the use of 250 million gallons of ethanol this year, 500 million in 2012 and up to 16 billion gallons in 2022. As long as that lasts, it means smooth sailing for the ethanol industry. Sen. James Inhofe, R-Okla., and Rep. Darrell Issa, R-Calif., have introduced legislation that would allow states to withdraw from the mandate.
But for the present, the mandate, the biggest subsidy of all, seems here to stay.