Welcome news? Really?
...the Senate Finance Committees recent extension of the cellulosic ethanol income tax credit is welcome news.
For whom? Certainly not consumers. To the crony capitalists and the political/subsidy feedback loop, certainly.
Picture an America in some parallel universe: The oil industry announces that it is mixing 10% or more of Ethanol into the gasoline supply. Immediately, America's already most hated industry is attacked from all quarters for attempting to literally water down American's fuel to rip off consumers. Ralph Nader would be filing class action lawsuits on behalf of all consumers for the losses related to reduced fuel economy and damage to internal combustion engines, and Al Gore would go on a rampage about the increased net carbon footprint and other environmental damage because of the resource intensive nature of producing Ethanol. There'd be food riots in the 3rd world, because of the diversion of food crops to produce Ethanol, and vast amounts of rain forest would be cut down for crop land needed to make up the difference.
Oh wait. The last part actually has happened in our universe too.
At least the America in that universe retains some degree of sanity. Ours clearly does not. Ethanol is a complete scam. The idea that ethanol is low carbon is a flat-out lie, especially considering that it takes a gallon of oil-based products (gasoline, diesel, and fertilizer) to produce a gallon of Ethanol, which actually has lower heat content than the fuel it's replacing. Getting lower mileage these days? That's probably why. Never mind the damage that may be happening to your engines. (But now that the US government is also an automaker, they're okay with the idea that your older car is going to die a premature death - Just consider it another personal sacrifice for keeping the UAW in business)
Ethanol subsidies are a perfect example of the destructive feedback loops that are created when the government starts subsidizing. Producers receiving the subsidy get comfortable, then dependent on the subsidy. A percentage of the subsidy is then fed back to the politicians to keep the subsidy in place, or to even expand. The last thing any of these people want is for the subsidy to ever end. Meanwhile, more viable alternatives are squeezed out of the market and never happen.
Even Al Gore now admits that supporting Ethanol was a mistake, and that he did so only because he had to buy much needed votes from the farm states.
I have every expectation that in 100 years when all transport is fueled by something other than carbon-based energy, that we'll still be subsidizing Ethanol, just like the city of Detroit still subsidizes a horseshoe changer.
