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The Ethanol Mandate: Don’t Tweak, Abolish (a costly fuel without a public purpose)

By James M. Griffin -- January 23, 2014

[Editor note: This post is taken from a new policy brief, The Latest Unanticipated Consequence in the Ethanol Fiasco, released by the Mosbacher Institute for Trade, Economics, and Public Policy at Texas A&M University. Professor Griffin, who directs the Mosbacher Institute, is also author of U.S. Ethanol Policy: Time to Reconsider? in The Energy Journal (Fall 2013).]

Executive Summary

  1. The 2007 mandates to steadily increase ethanol content in gasoline have hit yet another roadblock.
  2. Falling — instead of rising — gasoline consumption means that fuel blenders can no longer absorb the mandated ethanol quantities and still produce gasoline with no more than 10% ethanol content.
  3. Auto manufacturers strongly object to raising the ethanol content above 10%.
  4. Now, the EPA has proposed a one-time, one year waiver relaxing the 2014 mandate.