Ethanol, Now

Several St. Louis area gas stations are selling high-ethanol gasoline for $0.85 a gallon. That’s eighty-five cents a gallon. How can they sell this alternative to Saudi Arabian oil so cheaply? According to the AP

Ethanol prices have declined sharply in recent months, largely because of the rapid growth in supply and few new markets. Shaw maintains that refiners are ignoring ethanol and keeping the additive out of some markets where it is readily available. The wholesale price of a gallon of ethanol is now about $1.20, compared with $1.75 in January, according to the National Corn Growers' Association.

The GOP House leadership, including Tom Delay (R-TX) is managing the energy bill in Congress to limit increases in use of Ethanol in place of gasoline.

While the bill does require a 20 percent increase in ethanol production over the next five years, crtitics, inlcuding former CIA director James Woolsey, contend that moving to ethanol more quickly will protect us against dependence on foreign oil and deprive terrorists their primary source of income.

Increasing the requirement beyond 5 billion gallons a year may be just as difficult.

The higher number is opposed by both Majority Leader Tom DeLay and Rep. Joe Barton (news, bio, voting record), both of Texas. Barton will manage the energy legislation on the House floor, beginning Wednesday. The oil industry also has vowed to vehemently oppose any requirement beyond what’s already in the bill. (source)

There are two factions, in fact, opposing increased use of ethanol: oil-state Republicans, like DeLay, and liberal coast Democrats. Each group has its own, selfish reasons.

President Bush has been accused of kissing the butt of big oil. This energy bill gives the president another opportunity to befuddle his critics by defying the oil industry and pushing for increased use of renewable, cheap, and viable ethanol.