December 02, 2010
Domestic ethanol keeps sheiks and ‘nutty dictators’ at bay—Grassley
Published in E & E
Republican Sen. Chuck Grassley of Iowa today called for the extension of tax breaks for domestic ethanol production, touting the renewable fuel as an alternative to importing oil from sheiks and "nutty dictators" like Venezuelan President Hugo Chávez.
Letting the industry supports lapse would amount to levying a new gas tax of about 5 cents per gallon at the pump, Grassley said in a speech on the Senate floor.
At issue is whether some $6 billion in tax incentives should be extended for blending domestically made ethanol, most of it produced from corn, into gasoline. The volumetric ethanol excise tax credit, or VEETC, is set to expire at the end of this month.
Grassley argued that the domestic ethanol industry is just as deserving of federal support as the "centuries old" oil and gas industry, which gets millions in federal support.
"I know that removing incentives for oil and gas will have the same impact as removing incentives for ethanol -- we'll get less domestically produced ethanol, and be more dependent on those oil sheiks," he said.
"It's important to remember that the incentives exist to help the producers of ethanol compete against the big oil industry," Grassley added.
He noted that the Obama administration is on record in support of domestic ethanol production and asked, if ethanol supports are allowed to expire, "from where should we import an additional 10 percent of gasoline?"
Another ethanol industry support, a tariff on imports that mainly affects Brazilian sugar cane-based fuel, is also set to expire at the end of the year.