U.S. Senate Votes To End Ethanol Tax Credits

In a 73-27 vote, Senate members from both parties recently voted to put an end to the Volumetric Ethanol Excise Tax Credit (VEETC) which many said was wasteful and costly in a time of extreme economic instability in the United States.

Ethanol, which is made from corn or sugar cane, was initially lauded as a cleaner burning and domestically-renewable alternative to gasoline. To encourage the production of ethanol, the government passed VEETC, a tax break that amounts to a subsidy of 45 cents per gallon to companies that blend ethanol into gasoline, costing taxpayers a total of $6 billion per year.

But, as many researchers and environmental advocates soon discovered, ethanol was not the safe and clean biofuel it was touted to be. In fact, research shows that not only were ethanol plants permitted to emit chemical pollution that was far above the normal limit for fuel production, the production process for ethanol actually consumed more fossil fuels that it replaced.

Not to mention the fact that agricultural subsidies encouraged farmers to divert much needed crops away from the food supply.

And as Care2′s Gina Marie Cheeseman pointed out:

From 2005 to 2009, $17 billion was spent in ethanol subsidies, according to an EWG report, Driving Under the Influence. During that time period ethanol blended into gasoline reduced overall oil consumption “equal to an unimpressive 1.1 mile-per-gallon increase in fleet-wide fuel economy.” A gallon of ethanol yields only two-thirds the energy as a gallon of gasoline. “At the national level, this means that the 10.6 billion gallons of ethanol burned in 2009 displaced just 7.2 billion gallons of gasoline,” the report stated.

Tax credits for ethanol were already set to expire at the end of 2011, but if signed into law the amendment approved by the Senate would revoke the $6 billion tax credit by July 1, and could save $3 billion dollars this year. Action is pending in the House of Representatives.

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Image Credit: Flickr - drewzhrodrague

Read more: Do Good, Green, Life, News & Issues, Transportation, biofuel, corn, EPA, ethanol, fuel, gas, tax credit

Disclaimer: The views expressed above are solely those of the author and may not reflect those of
Care2, Inc., its employees or advertisers.

Joe R.

3:37PM PST on Mar 1, 2012

Thanks.

send a green star

Mody A.

9:55PM PST on Feb 29, 2012

be happy
http://liferaises.com

Vaiva G.

11:00AM PST on Jan 30, 2012

you know it's bad when politicians are taking away tax credits. i never thought ethanol was even worse than gas!

Spoorthi B.

11:01PM PDT on Aug 1, 2011

hi everyone, please sign this petition and help
http://www.thepetitionsite.com/1/heidi---a-girl-of-the-alps/

Lupe G.

9:48AM PDT on Jul 19, 2011

I work around a lot of scientists & when the whole ethanol craze hit, we all discussed the pros & cons. This was exactly what was mentioned. What now?

David H.

10:05PM PDT on Jul 17, 2011

@zum G the cars in the USA might not be built to run on Corn but since the late 70s Brazil has had there whole country running on sugar beets which is better since it produces twice as much sugar to make the ethanol.l If done right it would have caught on.

@Joh we have that it is called the Chevy volt:) because it isn't a true hybrid, Motor running at over 30 mph, you can get some killer mileage. There test cars were getting hundreds of miles per gallon. and if you hit a recharge before you run out of battery power just imagine how long it would be between fill up if you do less than 60 miles/day.

Quick note here. K&N air filters saves trees give you better horse power and when your foot isn't deep in the gas better fuel economy.(You can find this buried in the website as a "we can not estimate the fuel savings do to..." don't want to shell out $50 for one of them get a basic one that is just as good as your normal air filter but still saves trees and the money in your wallet for about the same price as a regular air filter. Oh yea and you don't throw them out so less junk in the trunk of your local landfill:)

Laura S.

5:37PM PDT on Jul 12, 2011

Yay!

Zum G.

6:04PM PDT on Jul 11, 2011

good. It's not like politicians pocket every extra penny they can get-they have fixed salaries. Companies 'donate' directly to the parties to get them to offer tax credits so you will buy their products.
Besides, ethanol is way overrated and is not as clean as we think. Think it's just the environment? Think again! Cars were not designed to burn ethanol. It is not good for your car and may leave you having to pay big bucks for more frequent maintainence

Anna S.

10:36AM PDT on Jul 11, 2011

Thanks for the article

H J.

9:31PM PDT on Jul 8, 2011

Tax credits for NOT consuming! Tax credits for clotheslines, Tax credits for sustainability. NOT for gas/oil/ethanol.