• The Energy Independence and Security Act of 2007 increased the annual amount of renewable fuels (including ethanol) that must be blended into the nation's gasoline supply. The 2009 corn-ethanol mandate of 10.5 billion gallons is set to increase to 15 billion gallons in 2015. In 2022, the total mandate for all renewable fuels (including ethanol) is 36 billion gallons.[1]
  • The ethanol industry enjoys a range of government subsidies and benefits. Chief among these are a domestic-blending credit and a tariff on imported ethanol. Domestic ethanol production enjoys a 45 cents-per-gallon subsidy from the federal government, regardless of the ethanol's country of origin. In other words, other countries that export ethanol to the United States, to be blended into the U.S. gasoline mix, receive the subsidy. In addition, the U.S. ethanol industry is protected against foreign ethanol producers in the form of a 2.5 percent ad valorem tariff and a 54 cents-per-gallon tax on ethanol imported into the United States.[2]
  • U.S. ethanol facilities produced 19,545 million barrels of ethanol in January 2009. Additionally, the United States imported 371,000 barrels of ethanol during the month of January, all of which arrived from non-OPEC countries (209,000 barrels from Trinidad and Tobago alone).[3]
  • U.S. ethanol production in January 2009 fell 3.9 percent from December 2008. January's annualized production figure of 10.25 billion gallons represents about 83 percent of U.S. plant utilization. The decline in ethanol production in January was fully expected by the market due to the large number of ethanol plants that have been idled this year due to poor ethanol profitability. According to esti­mates by Bentek Energy, U.S. ethanol production fell by another 1.2 percent in February and 5.7 percent in March.[4]
  • Of the 193 refineries in the United States — whose collective nameplate capacity is 12,375.4 million gallons per year — there are currently 170 plants in operation, totaling 10,314.4 mgy.[5]
  • For purposes of comparison: DTN Ethanol Center reports the following numbers of ethanol plants, as of April 7, 2009, for all types of feedstock (corn, switchgrass, wood pulp, etc.): 167 operational plants, 36 plants not producing, 19 plants under construction, 229 plants planned, 49 plants on hold and 19 plants cancelled.[6]
  • For further comparison: According to Ethanol Producer Magazine, as of April 7, 2009, there were 168 plants producing ethanol, 37 not producing, 15 plants under construction and one plant with plans to expand.[7]
  • Twelve recently idled VeraSun plants have an annual capacity of 1.2 billion gallons, or 60 percent of the total idled capacity in the United States (about 2 million gallons).[8]
  • On March 6, 2009, an ethanol coalition called Growth Energy formally requested from the EPA that the current 10 percent cap on the amount of ethanol that may be blended into gasoline be increased to 15 percent. EPA must respond within 270 days from the date of the request.[9]
  • According to the EIA, 59 percent of energy-related subsidies are associated with end-use applications or with fuel consumed outside the electric-power sector. These subsidies totaled $9.8 billion in FY 2007. About one-third of energy subsidies unrelated to electricity production are related to the promotion of alternative fuels, particularly ethanol and biodiesel. For energy subsidies unrelated to the production of electricity, ethanol/biofuels received the most in subsidies in 2007 compared to the amount of energy produced: $5.72 per million British Thermal Units. Solar energy was the next largest recipient, at $2.82/MMBtu. Refined coal, at $1.35/MMBtu, was the only other fuel to take in more than $1/MMBtu.[10] 

[1] See frwebgate.access.gpo.gov/cgi-bin/getdoc.cgi?dbname=110_ cong_bills&docid=f:h6enr.txt.pdf (Page 32).

[2] Federal Ethanol Incentives and Laws, Alternative Fuels & Advanced Vehicle Data Center, United States Department of Energy, www.afdc.energy.gov/afdc/ethanol/incentives_laws_federal.html.

[3] Petroleum Supply Monthly March 2009 (with data for January 2009), Energy Information Administration, www.eia.doe.gov/pub/oil_gas/petroleum/ data_publications/petroleum_supply_monthly/current/pdf/psmall.pdf.

[4] Ethanol Outlook Report, CME Group, For the week of April 6, 2009, http://cmegroup.barchart.com/ethanol/archive/1239022742CME-Weekly-Ethanol-06-Apr-2009.pdf.

[5] Renewable Fuels Association, http://www.ethanolrfa.org/industry/locations/.

[6] Plant List, DTN Ethanol Center, http://www.dtnethanolcenter.com/index.cfm?show=47&mid=48.

[7] Plant List, Ethanol Producer Magazine, http://www.ethanolproducer.com/plant-list.jsp.

[8] Ethanol Outlook Report, CME Group, For the week of April 6, 2009, http://cmegroup.barchart.com/ethanol/archive/1239022742CME-Weekly-Ethanol-06-Apr-2009.pdf.

[9] Growth Energy To EPA: Lift Cap, Create Jobs, Press Release, March 6, 2009, http://www.growthenergy.org/2009/news/showItem.asp?id=24.

[10] Federal Financial Interventions and Subsidies in Energy Markets 2007, Executive Summary, Energy Information Administration, http://www.eia.doe.gov/oiaf/servicerpt/subsidy2/pdf/execsum.pdf.