Policy Documents

Myth Busting Ethanol Fuel Subsidies

Brian Costin –
May 5, 2008

Environmentalists in recent years have enthusiastically hailed ethanol fuel as a central element in combating what they perceive as a global warming crisis caused by manmade carbon dioxide emissions.

Policy experts have pointed to three major problems with this notion. One, ethanol fuel will not reduce global warming. Two, ethanol does not provide much fuel when compared with the amount of resources used to produce it. And three, the diversion of grain to ethanol production has resulted in higher food prices in the developed world and food shortages, food riots, and starvation in less-developed nations.

Time magazine exemplifies the changing understanding of ethanol. In its "Global Warming Survivor Guide" in the magazine's April 9, 2007 issue, Time argued the number-one recommendation (out of 51) to save our environment was to turn our food into fuel.

Just one year later, emblazoned on the front cover of Time's April 7, 2008 issue was the headline "The Clean Energy Myth." The story inside begged for a reversal of ethanol policies, admitting "biofuels aren't part of the solution at all. They're part of the problem." Public opinion on ethanol has radically changed from enthusiastic support to serious opposition.

Over the past year a number of published, peer-reviewed studies have cast serious doubt on the claim that ethanol will reduce carbon dioxide emissions and improve our energy independence. They have found the clearing of land to produce ethanol leads to increased carbon dioxide emissions while placing strains on natural resources and food prices. They have also contested the claims that ethanol will afford the United States energy independence.

As this Research & Commentary collection shows, destroying wildlands to grow ethanol-producing crops will reduce carbon sequestration. The energy required to make ethanol, combined with ethanol's lower energy content, will keep ethanol from significantly reducing reliance on fossil fuels. And food prices will continue to rise, solely because of misguided ethanol policies.

Ethanol fuel is literally a life-and-death issue. The U.N.'s Food and Agricultural Organization's 2006 report on "Undernourishment around the world" found an estimated 852 million people on this planet are malnourished. Diversion of grains from food to fuel has already exacerbated the problem, and the situation will get worse as more land is used to produce fuel.

Elected officials creating corporate subsides and tax privileges for ethanol producers are a part of the problem. They can become part of the solution by ending ethanol subsides, to help secure our food supply and protect our natural resources.

The following articles explore ethanol issues in more depth.


The Clean Energy Scam
This Time magazine article shows the biofuel boom is doing exactly the opposite of what its proponents intended: It's dramatically accelerating global warming, imperiling the planet in the name of saving it. Biofuels are hiking world food prices and endangering the hungry. The grain it takes to fill an SUV tank with ethanol could feed a person for a year.

Biofuel Farming Looks to Be an Environmental Disaster
The February 7 edition of Science magazine takes a close look at two studies that examine carbon emissions from the ecosystems torn down to produce biofuels. Both studies found changes in land use related to biofuel production would be a significant source of greenhouse gases in the future.

The Ethanol Boondoggle
Jerry Taylor and Peter Van Doren of the Cato Institute examine the politics, economics, and environmental impacts of ethanol. They document the disastrous consequences of subsidies and tax breaks.

Climate Change and Energy: The True Cost of Biofuels
A recent study from the Nature Conservancy and University of Minnesota finds, "Converting rainforests, peatlands, savannas, or grasslands to produce biofuels in Brazil, Southeast Asia, and the United States creates a 'biofuel carbon debt' by releasing 17 to 420 times more carbon dioxide than the fossil fuels they replace."

Fuel Choices, Food Crises and Finger-Pointing
This New York Times article highlights the growing international opposition to policies in the United States and Europe to promote ethanol at a time when "political leaders from poor countries are contending that these fuels are driving up food prices and starving poor people."