Tuesday, May 29, 2012

Politics

Bush Goes Into High Gear on Energy

By Bret Schulte
Posted 1/24/07
Page 2 of 2

To date, scientists haven't figured out how to make this cost effective. Ragauskas says new technology looks promising, but many experts believe it's unlikely that the fuel will go from zero to 20 billion in 10 years. It took the corn industry more than a decade to get to 1 billion gallons of ethanol capacity.

Although Renewable Fuels Association President Bob Dinneen predicts cellulosic ethanol will be on the market "quicker than anybody expects," Bush may have his own doubts. A background paper released by the White House in advance of the State of the Union address noted multiple "safety valves" to allow this or future administrations out of the proposed mandates "to protect against unforeseen increases in the price of alternative fuels or their feedstocks."

That escape clause is "like a New Year's resolution," says Jerry Taylor, an energy expert at the libertarian Cato Institute: "I promise to lose 20 pounds in the next 25 years unless I deem it too troubling or too costly."

Taylor believes the proposal will be too troubling or too costly. He cites estimates that put the price of producing a gallon of cellulosic ethanol at seven times the cost of producing a gallon of corn ethanol. He predicts that the Bush proposal, like the hydrogen car idea before it, will quickly be forgotten.

But Congress is writing a new farm bill this year, and Harkin has repeatedly stated that energy will be the driving force behind it. For the ag committee, that means ethanol. Few doubt that more mandates or subsidies to boost ethanol production are on their way. But there is much more doubt as to how these goals will be met and whether cellulosic ethanol will be the panacea politicians promise.

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