Corn Ethanol Opposition Growing

WASHINGTONEven though U.S. producers of corn ethanol received a 1-year extension of a tax credit giving them nearly 12 cents of federal cash for every liter of corn ethanol they blend into gasoline, and a tariff of more than 14 cents per liter on imported ethanol , they are encountering increased skepticism from lawmakers.

As reported by Nature News, industry insiders accuse the government of not supporting advanced ethanol companies in their quest to ramp up their technologies and lower operating costs. Critics say the corn ethanol credit eats up scarce federal resources and puts cellulosic ethanol at a competitive disadvantage.

The mandated levels of biofuel production in the United States will increase to 53 billion liters in 2011 and increase to more than 136 billion liters by 2022. Around 90% of the biofuel will come from conventional corn ethanol next year, with the remainder coming from biodiesel and other "advanced biofuels".

Matt Hartwig, a spokesman for the Renewable Fuels Association in Washington, said although a longer extension would have been preferable, one year at least allows time for "a more logical conversation about how we reform energy tax policy."

Hartwig said cellulosic producers have been hampered by the economic crisis and a lack of financing to scale up basic research and development. The U.S. Department of Energy has supported biofuels through research grants, including $30 million for research into "next generation" biofuels announced last week, but has yet to finalize any loan guarantees for companies wanting to build pilot plants. Although industry officials say that the program's requirements for granting loans are too burdensome, others say that the delays are primarily due to technical issues that companies have yet to resolve.

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