"Coalition for E85" Wants a New Tax Break for Ethanol
October 18, 2011 1:01 PM
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E85 will be much more expensive than normal fuels without a new tax credit according to the coalition
The tax rebate on ethanol fuels is set to expire at the end of this year. This will vanquish the tax credit that allowed ethanol producers in the U.S. to export as much or more of the fuel to other countries than was used in American fuel tanks. Steven Rattner stated in a piece written for the
, “Because of the subsidy, ethanol became cheaper than gasoline, and so we sent 397 million gallons of ethanol overseas last year. America is simultaneously importing costly foreign oil and subsidizing the export of its equivalent.”
exporting of ethanol
is one of the reasons the tax break on ethanol is ending.
With the deadline looming for the tax credit, a coalition is forming to get federal tax law amended to allow E85 to get a tax cut. The new group will be called the Coalition for E85 and it is specific in that it isn't out to get the tax credit back for E10. The coalition will let that tax expire with no fight from its members, but it wants the E85 blend to gain a new tax cut or the coalition warns the days of E85 might be numbered.
The blenders that make E10 fuel that is in wide use, and is a mix of 10% ethanol and 90% unleaded are getting a 4.5-cent-per-gallon tax credit. E85 is getting a credit of 38.25 cents per gallon under the Volumetric Ethanol Excise Tax Credit or VEECT. This is the tax that expires in December.
What the coalition is seeking is a change that would allow the E85 blend to receive the Alternative Fuel Credit (AFC). E85 was excluded from the AFC originally to keep it from being able to qualify for both the VEECT and the AFC credits. With the VEETC being discontinued, the makers want E85 to now get the AFC credit to allow the E85 fuel to maintain closer price parity with normal fuels for consumers that drive Flexi Fuel Vehicles. Flexi Fuel Vehicles or FFVs are able to burn regular gasoline and E85.
The coalition is trying to raise $75,000 to hire a Washington lobby group to speak on its behalf.
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The difference of development and usefulnes
10/19/2011 12:25:54 PM
Well, it is good to study alternative fuel sources, and some support to new technology is needed, because "old" and "known" technology is normally cheaper, and works better in the beginning. But, the extra support have to end one day, so that the best and most economical alternative can survive. What ever that may be! The old, "the new" or some other competitor.
I am not sure how long time the ethanol should be supported, but the time is running out. The plug and support wheels has to be removed, so that we can see if it is, or ever will be an good alternative to oil. If it's not, it is better to put money on some other form fuel, bacause later or sooner the oil suplies will dry out. But as I said it is not usefull to support alternative that is doomed to fail. It is a waste of resources!
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