The tax deal, ethanol and coal-to-liquid fuels
In Washington, hopes for an up or down vote on the ethanol tax credit and other biofuels provisions in the proposed Obama-GOP tax deal were rocked, when Senator Dianne Feinstein of California sought to amend the bill to slash the ethanol tax credit to 36 cents per gallon, and to repeal the ethanol tariff.
Feinstein said that the ethanol tariff made the country more dependent on OPEC by discouraging ethanol imposts. Feinstein received indirect support from NRDC, which stated: “Sending 70cents of every renewable energy dollar to oil companies to use ethanol defies common sense. It is time to invest in new fuels and clean energy sources that provide long-term energy security and clean up the air and water that we all need.”
Ironically, for all the hoopla over the ethanol tax credit, the larger subsidy in the proposed bill is a 50 cent per gallon tax credit for transportation fuels – fuels produced by liquefying coal. The proposed CTL fuels must come from plants that capture and dispose of 75% of their CO2 emissions.
Category: Policy
