Clark admits corn ethanol doesn't need subsidies but fails to see that more corn ethanol comes at the expense of better biofuels

In early 2010, to listen to corn ethanol proponents was to believe that ending the Volumetric Ethanol Excise Tax Credit—the main corn ethanol tax credit known as the “VEETC”—would spell the demise of the domestic corn ethanol industry, with exaggerated claims of shuttered plants and countless lost jobs. Now retired General Wesley Clark, co-chairman of the corn ethanol industry group Growth Energy and one of the best known advocates for corn ethanol, seems to be openly admitting what we’ve long known: corn ethanol is a mature, mainstream industry that should no longer be receiving billions a year in taxpayer subsidies.

Despite this admission, Clark and others in the industry continue to push for what amounts to more government support by a different name—infrastructure—while paying lip service to the potential of next generation cellulosic biofuels. But more giveaways to the corn ethanol industry, whether they come in the form of tax credits or costly loan guarantees for ethanol pipelines, just locks more old, dirty corn ethanol into the market. And it comes at the expense of investing in the cleaner, advanced biofuels we need, which are being developed to drop right into our current fueling system.

Last year, study after study concluded that the VEETC is redundant and wasteful, the coalition against corn ethanol subsidies grew, and the political tide shifted accordingly. The corn ethanol industry was already reading the tea leaves by year’s end, fighting to keep just a fraction of the $31.5 billion, 5-year VEETC extension they initially demanded. Today, the drumbeat against corn ethanol subsidies has grown even louder, as a remarkably broad coalition of organizations and lawmakers from both sides of the aisle, from Republican Senator Tom Coburn to Democratic Senator Dianne Feinstein, all call for an immediate end to corn ethanol subsidies.

In response to this recent proliferation of anti-VEETC proposals in Congress, Clark told reporters yesterday that U.S. corn ethanol producers were doing just fine, subsidy or no subsidy:

 "The truth about the industry right now is that it's in pretty good shape”.  Even if the VEETC is eliminated immediately, he said, "you'd still have the renewable fuel standard, and people would still buy ethanol".

Instead of continuing the VEETC, Clark has said he supports trading tax credits for infrastructure investments, such as financial support for gas stations to install dedicated ethanol storage tanks and "blender pumps" that would allow drivers to fill up with higher blends of ethanol.

At the same time, Clark seemed to acknowledge that corn ethanol is not the biofuel of the future, expressing his optimism over cellulosic biofuels:

"This cellulosic program is going to kick in big time," when next-generation fuels made from agricultural waste, trash, wood or other nonfood crops will be used to make ethanol at commercially viable scales and prices.

More of Clark's comments can be found in this E&E News piece (subscription needed).

But these bullish predictions for cellulosic biofuels are made less and less likely the more subsidies we channel to the corn ethanol industry. And as we discussed here, the industry has demonstrated that it intends to continue pushing for policies that benefit corn ethanol at the expense of better biofuels, including billions more in taxpayer support, a redefining of “advanced biofuels” under the Renewable Fuel Standard to include conventional corn ethanol, and efforts to block EPA from following the science on indirect land-use change when accounting for the lifecycle carbon emissions of biofuels.

What the corn ethanol industry says and what the corn ethanol industry does are simply not the same thing. Until we get the first billion gallons of cellulosic biofuels done right, we should not spend any more scarce taxpayer dollars propping up the mature corn ethanol industry. This starts with Congress ending the VEETC once and for all.