Believe it or not, the Renewable Fuels Association, the ethanol trade association, thinks the industry should get a $1 billion bail-out in addition to taxpayer subsidies.
Corn ethanol has been clobbered by the commodity bust, which has reduced prices from $2.90 to $1.60 a gallon, which barely coveres production costs. The industry needs high oil prices to be competitive.
VeraSun Energy filed for bankruptcy, and many producers are suffering in an industry that built way too many plants too quickly.
The industry wants $1 billion in short-term credit to keep plants in business and they want up to $50 billion in loan guarantees to finance expansion. They also want Congress to allow a higher percentage to be mixed with gas (now 10%), even though this doesn’t work in vehicles other than flex-fuel.
Five environmental NGOs including The Environmental Working Group publicly opposed the bail-out saying, "subsidies for corn-based ethanol have produced unintended, yet potentially catastrophic environmental consequences, with little or no return to taxpayers in energy security [or] protection from global warming."
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