Two new bills seek to end corn ethanol subsidies; one would continue giveaways to bad biofuels
Two bills were introduced this week in the U.S. Senate that would stop support for bad biofuels and save taxpayers billions this year alone. Both efforts, one led by Senator Feinstein and the other by Senators Coburn and Cardin, would repeal the main corn ethanol tax credit—know as the Volumetric Ethanol Excise Tax Credit or “VEETC”—showing once again the bipartisan Congressional support for ending wasteful corn ethanol subsidies.
They contrast sharply with Senator Klobuchar’s move to recycle her harmful energy bill from last summer, which would move us backwards by continuing massive giveaways to bad biofuels like old dirty corn ethanol at the expense of the cleaner, advanced biofuels we need and strip away critical safeguards that protect our valuable forests from being turned into fuel.
Starting in June of this year, the Feinstein bill would repeal the $0.45 per gallon tax credit we pay to oil companies blending corn ethanol and lower the import tariff we impose on imported ethanol from $0.54 to $0.45. Ethanol that qualifies as an “advanced biofuel” under the Renewable Fuel Standard—that is, ethanol that delivers at least a 50% reduction in greenhouse gas emissions from a 2005 baseline—would still qualify for the tax credit. A day earlier, Senators Coburn and Cardin joined forces across the aisle to introduce a similar bill that would more simply eliminate the VEETC effective immediately.
Explaining how her bill would cut government waste and boost our environmental and energy security goals, Senator Feinstein said:
"Ethanol subsidies and tariffs sap our budget, they're bad for the environment and they increase our dependence on foreign oil. My bill would save taxpayers $3 billion just in the first six months, money that would help bridge the divide in today's budget dispute."
Senators from both sides of the aisle have shown that they understand that smart, fiscally responsible energy policy means ending subsidies for bad biofuels and supporting the development of better biofuels that reduce our dependence on foreign oil, enhance our national security, create jobs, and curb global warming pollution. This starts with ending subsidies for old, dirty corn ethanol. Congress should resist attempts to lock us into more dirty fuels and seize the opportunity to save taxpayers billions while putting us on the path towards better biofuels.