American Elephants

Millions in Penalties for Not Using a Biofuel That Doesn’t Exist by The Elephant's Child

A basic theme of liberalism is that big government is better government, because wise people from the better schools can do a more efficient job of managing and regulating the economy, because they’re smarter than the rubes out there with their Bibles and guns.  They seldom say it straight out, but it does pop up accidentally every so often.

The powers-that-be have estimated that gasoline prices will rise significantly this summer, and some have suggested that it might be time to dip into the strategic reserve again.  The reserve that was called a “reserve” and “strategic” because it was supposed to be there in the event of a real catastrophe. Higher prices may be hard on the pocketbook, but they are not a catastrophe.

One of the reasons that gas prices may be higher this summer is that oil companies will, when they close the books on 2911, have to pay about $6.8 million in penalties to the Treasury, because they failed to mix cellulosic biofuel into their gasoline and diesel fuel as required by law.  In 2012, the penalties will be even higher.  Cellulosic ethanol is made from wood chips or the inedible parts of plants like corncobs. Refiners were required to blend 6.6 million gallons of biofuel into gasoline and diesel in 2011 and face a quota of 8.65 million gallons this year.

Trouble is, there isn’t any. Cellulosic biofuel exists in a few laboratories, but not commercially. It doesn’t exist. Small details like that have never stopped the EPA in its bid to reduce the nation’s greenhouse gas emissions, and reduce the country’s “dependence on foreign oil.”

Michael McAdams, executive director of the Advanced Biofuels Association acknowledged that the technology for turning biological material into hydrocarbons is advancing, but not ready for commerce.

Retired Vice Admiral Dennis McGinn who serves on the American Council on Renewable Energy defends the statute. Even if the standards for 2011 and 2012 are not met, he said:

I am absolutely convinced from a national security perspective and an economic perspective that the renewable fuel standard, writ large, is the right thing to do. With oil insecurity and climate change related to greenhouse gas emissions as worrisome as ever, advocates say, there is strong reason to press forward.

Well, not so much. The entire case for a worrisome climate change is falling apart. Climate change appears to be absolutely normal rather than something to worry about. The amount of CO2 in the atmosphere is far less than it has been in the past, and mostly rises from the seas rather than the tailpipes of SUVs. There has been no warming since 1998, records of temperature have been falsified. We have discovered huge quantities of recoverable oil and gas in shale deposits across the country. What is depriving us of energy and keeping the cost of energy high is President Obama’s war on energy.

The Keystone XL pipeline delays have cost thousands of jobs and millions in economic activity. The president claims that even though it has been approved by every agency involved, it could imperil aquifers in the area, but doesn’t explain why all the other pipelines in the area are perfectly safe. The president delivered a real blow to the economies of the Gulf just when they could least afford it. All of the operators in the Gulf do not need to be shut down because there was a mistake on one rig. The administration has issued a ban on new uranium mining operations in the Colorado River Basin, citing “environmental” concerns.  The “environmental” concerns seem to be a threat from Big Environment to withhold campaign contributions.

History shows that the money that individuals and businesses invest and spend, if left alone to do so, generates far more wealth and new jobs than any government-directed spending.  The most successful cities and states dedicate their resources to creating the kind of conditions that attract private investment, rather than pouring public money into centrally planned visions of economic development.                                                                                                             (Brian C. Anderson, City Journal)

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