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Rep. Peter Welch (D-Vt.) offered an astute observation recently about federal ethanol policy. Speaking at a National Journal event titled, “Biofuels Mandate: Defend, Reform, or Repeal ,” Welch pointed out that the ethanol industry has benefited from a “trifecta” of preferential federal policies: subsidies, tariffs, and mandates. Beyond wasting taxpayer funds, these policies have real, harmful effects on the American people. We’ll explain each policy and address their impacts,...
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There are many problems with the standard case for a carbon tax, including very dubious assumptions in the computer models used to calibrate the so-called “social cost of carbon.” Yet even if we put aside all of those principled objections, the way that the Obama Administration in practice has tried to clamp down on greenhouse gas emissions is alarming. Susan Dudley, Brian Manix, and Sofie Miller spell out the problems in a recent Reuters article . With the failure of efforts to...
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In a recent op-ed for The Hill, Ron Lamberty of the American Coalition for Ethanol likens the federal ethanol mandate to “A Christmas Story,” a classic American film about a boy who wants Santa to give him a Red Ryder BB gun for Christmas. The analogy isn’t far from the truth. In 2005, Congress gifted Big Ethanol its version of Ralphie’s Red Ryder BB gun—a federal mandate that requires Americans to purchase their products. Indeed, the Renewable Fuel Standard (RFS) has been a gift...
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A leaked draft of the Environmental Protection Agency’s (EPA) 2014 volume requirements under the Renewable Fuel Standard (RFS) reveal that the agency may decrease the total biofuel mandate but nearly quadruple the amount of cellulosic biofuel that refiners must blend into gasoline. The draft proposal calls for decreasing the total amount of biofuel to 15.21 billion gallons in 2014, down from 16.55 billion gallons this year and slightly above the 15.2 billion gallons in 2012. It would also...
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On October 16, 1973, the Arab members of the Organization of Petroleum Exporting Countries (OPEC) announced a decision to raise the price of oil by 70 percent a barrel, which was followed by an embargo on oil shipped to the United States, a five percent reduction in production from September's levels, and ongoing production reductions in five percent increments until the organization’s economic and political objectives were met. A new analysis from IER takes a look back at the 1973...
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For the United States, 2013 has been the year of energy. Last month, the Energy Information Administration (EIA) announced that crude oil reserves were at their highest levels in more than two decades. Now EIA reports that the U.S. will surpass Russia and Saudi Arabia to become the world’s number one combined producer of oil and natural gas. Recent technological advancements in the U.S. that combine hydraulic fracturing and horizontal drilling have unlocked vast shale resources that were...
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A Washington Times article by Art Fraas and Randall Lutter exposes a systemic flaw in the way EPA attempts to justify its regulations, including the new Tier 3 rules. In March, EPA prosed new regulations on gasoline to reduce the sulfur content of gasoline. In this forum, we have written plenty of critiques of the Tier 3 regulations, showing the flaws in the case for it. However, Fraas and Lutter point out a new problem, which affects not just Tier 3 but EPA’s approach in general: When...
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A recent poll conducted by Harris Interactive on behalf of the American Petroleum Institute (API) finds that the vast majority of Americans are concerned about the negative consequences of the Renewable Fuels Standard (RFS). In a previous post we walked through some of the major results, including the fact that 77 percent of Americans are concerned that higher ethanol blends will damage their engines. The response from the head of the Renewable Fuels Association (RFA), Bob Dinneen, shows his...
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Despite federal law requiring refiners to blend increasing amounts of ethanol into gasoline, domestic ethanol production has actually declined over the last year. The U.S. ethanol industry produced 6.40 billion gallons of ethanol through the first half of 2013, down from 6.89 billion gallons over the same period last year, according to the Energy Information Administration’s (EIA) Monthly Energy Review . As the following chart shows, this is the third straight year that domestic ethanol...
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This is Part 3 of a three part series comparing biofuel mandates in the United States and the European Union. Part 2, which focused on increasingly unattainable mandates in the U.S. and EU, was published yesterday.  [caption id="attachment_1547" align="alignright" width="300"] Image: Flickr/snake.eyes [/caption] Biofuel mandates in the U.S. and EU impose enormous burdens on energy producers and consumers for negligible if not negative environmental impacts. These burdens include higher...
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