Ethanol and Offshore Drilling

http://www.futureofcapitalism.com/2010/05/ethanol-and-offshore-drilling

The Manhattan Institute's energy expert, Robert Bryce, writes in the Energy Tribune:

What's bad for the offshore oil and gas industry is good for corn ethanol and wind. On Wednesday, President Barack Obama was in an ethanol plant in Missouri singing the praises of ethanol. Here is what he said:

"I may be the President these days, but I want to remind everybody I was the senator from Illinois. I didn't just discover the merits of biofuels like ethanol when I first hopped on the campaign bus. I was telling Steve this was not the first ethanol plant I visited. And I believe in the potential of what you're doing right here to contribute to our clean energy future, but also to our rural economies."

The political signal is obvious: the Obama administration will soon approve a bailout for the ethanol industry courtesy of the EPA, which will agree to demolish the "blend wall" which will allow gasoline blenders to increase the amount of ethanol in the US gasoline pool from 10% to 15.% That same day, the Interior Department approved the Cape Wind project.

We reported back in February that the American Automobile Association of New York was warning of "a bailout for the ethanol industry that may come at the expense of drivers." The AAA magazine said then, "Environmentalists are crying foul because the E15 blend gets fewer miles to the gallon and is not a clean burning fuel, while the oil industry cites concerns over potential engine damage." Looks like President Obama is going ahead with it anyway, as if anyone needed reminding that before he was president he was "the senator from Illinois."

by Ira Stoll  |  May 4, 2010 at 10:27 am Related Topics:  Auto Industry, Energy, Politics, President Obama, Press receive the latest by email: subscribe to the free futureofcapitalism.com mailing list