Starting in 2002, receipts from user fees began to drop significantly, thanks largely to the impact of a slower economy and increased sales of gasahol, an Ethanol-based fuel that isn't taxed for the Highway Trust Fund and is heavily subsidized--thanks to the farm lobby and the efforts of Archer Daniels Midland (nyse: ADM - news - people ).
We massively subsidize corn-based ethanol, even though sugar-based ethanol appears to be far more efficient and less costly.
He cited the U.S. subsidies for corn-based ethanol and tariffs on sugar cane-based ethanol from Brazil.
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Last week, the Obama Administration said its new calculations showed that grain-based biofuels like corn ethanol and soy-based biodiesel displaced more carbon dioxide than originally thought.
So taxpayers funded a 40 MGY wood-based ethanol plant and they are instead getting a 4 MGY wood-based methanol plant.
As a bonus, switchgrass ethanol emits significantly fewer greenhouse gases than corn-based ethanol.
Late Wednesday, Heartland Ethanol, a Tennessee-based company, scrapped plans to build seven ethanol plants in Illinois, citing high corn prices.
Right now cellulosic ethanol is potentially eight times more energy-efficient than corn-based ethanol, because you eliminate the middle step of converting it into sugar before you convert it into ethanol.
ZeaChem was founded to produce both cellulosic ethanol and bio-based acetate and acetic acid.
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Such fibers are abundant and could supply 130 million gallons a year of ethanol that would replace gasoline, although it is still expensive when compared to corn-based ethanol and some early trials have ended in disappointment.
Subsidised corn-based ethanol is therefore a nifty way of meeting America's mandatory fuel-economy requirements without having to invest billions in new technology.
But regular corn-based ethanol is unlikely to be the fuel choice of American motorists anytime soon--not least because only so much farmland can be devoted to growing corn for ethanol without denting food production.
Given its environmental benefits, sugar-based ethanol has the potential to be a global industry.
Even Al Gore now admits that corn-based ethanol produces more carbon dioxide than it saves.
Due to large government subsidies, the growth of corn-based ethanol has been nothing short of meteoric.
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Of this amount, 21 billion gallons must come from biofuels other than corn-based ethanol.
From 2000 to 2010, U.S. corn-based ethanol production increased from 1.6 to 13.2 billion gallons per year.
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But instead of beer, he would brew ethanol, the crop-based fuel that suddenly has the U.S. in a froth.
The energy needed to produce a gallon of corn-based ethanol can exceed the energy generated by the ethanol itself.
But instead of beer, he would brew ethanol, the crop-based fuel that suddenly has the nation in a froth.
Clearly corn-based ethanol is not a sustainable solution for the U.S. energy needs.
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The U.S. leads biofuel innovation likely due to the U.S. abundance of agricultural resources and a history of subsidizing corn-based ethanol.
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For example, how many gallons of water and fossil fuel does it take to produce and transport one gallon of corn-based ethanol?
These promises are nebulous, unclear on what those new sources are, other than the thoroughly discredited without massive government subsidies corn-based ethanol.
Ostensibly to reduce carbon emissions, governments in both places have introduced policies to encourage biofuels (corn-based ethanol in America and biodiesel in Europe).
Given all the problems Obama will be facing, don't expect him to do too much to cut back on the massive subsidies for corn-based ethanol.
Anointed by the U.S. government and in receipt of political support from both sides of the political spectrum, corn-based ethanol has emerged as the biofuel of choice.
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Massive subsidies for corn-based ethanol, which means higher food prices.
During that period the Brazilians invested massively in a sugar-based ethanol industry to the degree that about a third of the fuel they use in their vehicles is domestically grown.
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