Sunday, May 07, 2006

Repeal the Ethanol Tariff!

Secretary of Energy Bodman suggested repealing the 2.5% tariff and supplemental 54 cent per gallon duty on imported ethanol. Repeal would allow for more economic importas of sugar cane based ethanol from countries such as Brazil, and ameliorate the ethanol shortage that is contributing to rising gas prices and led to the suspension of environmental regulations regarding cleaner gasoline. Kudos to the Secretary for a sensible proposal!! But of course the farm lobby is up in arms. Bad enough that we subsidize inefficient and over-priced corn-derived ethanol, but even when we can't produce enough of it we are unwlling to take action. These senators claim that tariff repeal would hurt the development of the domestic ethanol industry. Yes, the national security canard again. I feel safer already as we are protected against those horrible breeders of terrorists who grow sugar cane and produce ethanol such as Brazil and a host of Caribbean nations. While sugar cane ethanol is environmentally problematic, it is ten times more efficient than corn ethanol. Not to mention this is a golden opportunity to help poorer nations in our hemisphere. So the next time a farm state senator complains about high gas prices, ask he (or she if there are any) their position on this issue, and when they tell you they are against tariff repeal, you will know they are full of manure (and not using it to produce cheaper fuel either).

Stupid Energy Quote Award-to Nancy Pelosi

"Sadly, we are now living in a new era of robber barons"-House Democratic leader Representative Nancy Pelosi, referring to oil company profits. After doing nothing and saying nothing relevant about energy during her entire leadership tenure, this is the best she can do? Oil prices are market determined, and there is no evidence of any collusion on the part of oil companies. Why not attack speculative traders? Or put the blame where it belongs-on a US government that for 25 years has done nothing to reduce our dependence on oil. And what is the Congressional solution-a bill on price gouging, the ultimate political fig leaf that is politically popular and does nothing to solve the real problem.

Monday, May 01, 2006

The $100 Gas Rebate-What's Next, A Happy Meal?

So the Republican's new energy plan is to give us each a $100 to offset the rising price of gasoline. And what are we supposed to do after we fill up not even twice with this money? How is effectively reducing the price of gas going to drive down increasing demand, the primary cause of high prices, or increase tight supplies? This is a preelection joke designed to obscure the fact that Republicans have done nothing about energy for the entire period they have controlled the Presidency and Congress. Oh yes, and also in this bill is drilling in Alaska, which would minimally increase supply in 2010 while destroying the environment and other incentives for oil producers and refiners.

Not that the Democrats have done any better. They wanted a larger $500 rebate or suspension of the 18.4 cent per gallon tax. Of course, Democrats haven't had an energy policy since Jimmy Carter!

If we want to do something in the short term to help people who are truly hurt byrising prices and can't gasoline, fine. But lets accompany it with a real policy that will change the supply/demand dynamic rather than another band aid which will only prolong our insatiable oil appetite.

Keep Our Environment Dirty-Ethanol, MTBE and Waiving the Environmental Rules

So President Bush has decided to waive certain environmental rules regarding gasoline. Those rules at first required the addition of the additive MTBE, and when that additive proved to have adverse environmental effects, the addition of ethanol. Of course it never occurred to anyone that we wouldn't have enough ethanol and that the increased demand would drive up the price of the ethanol and thus gasoline. This regulation was passed without thought or planning, which seems to be a characteristic of this administration and politicians dealing with energy policy more generally. And the solution-SUSPEND THE RULES so we simply burn dirtier gasoline!! The rationale-to moderate gas prices. Anyone notice it working!!! This is an instance where we dont need to choose between clean and efficient-we can have both with little added cost. Of course, ethanol is not a solution for anything. BAD REGULATION, WORSE IMPLEMENTATION!