Ethanol subsidies in doubt as politicians quiet on renewal

Minnesota Public Radio
by Mark Steil, Minnesota Public Radio
September 17, 2010

Worthington, Minn. — The next few months are likely to be critical for the ethanol industry as two key subsidies for the alternative fuel expire in December -- and it's unclear if Congress will renew them.

One subsidy, called the blenders credit, pays refiners to mix ethanol into their gasoline. The other limits competition from ethanol imports. Together the two cost taxpayers about $6 billion a year.

So far Congress hasn't shown much interest in renewing the subsidies, which date back decades. That's a big change from just a few years ago, when ethanol was Washington's alternative fuel of choice. In 2006, the fuel rated a mention in President George W. Bush's State of the Union speech.

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