Competitive Enterprise Institute | 1899 L ST NW Floor 12, Washington, DC 20036 | Phone: 202-331-1010 | Fax: 202-331-0640
Congressional legislation has given much unnecessary support for biofuels. The 2007 energy bill greatly expanded the Renewable Fuel Standard in the United States, requiring almost 13 billion gallons of ethanol and other renewable fuels to be blended into the gasoline supply by 2010—ramping up to 36 billion gallons by 2022. The mandate has increased the cost of driving. Meanwhile, the diversion of nearly a third of the corn supply from food to fuel use has raised food prices. The mandate comes on top of favorable tax treatment for ethanol and other biofuels, including a 45 centsper- gallon tax credit, as well as protectionist tariffs that shield domestic corn ethanol from global competition. Few experts think that ethanol produced from corn in the United States is a scalable replacement for foreign petroleum imports. Its environmental benefits are minimal at best and come at a huge cost. Ironically, ethanol remains highly reliant on petroleum and natural gas for its production and delivery.