
Such considerations "represent a dramatic backlash against corn ethanol," Paulson writes, noting how the last few months have quickly changed corn ethanol's reputation. She adds: "Many experts worry that Washington's new skepticism will undo important progress the U.S. has made in replacing foreign oil with domestic energy alternatives. But others say that done right, a shift toward cellulose – nonfood plant material like grasses and crop residues – could reduce U.S. reliance on imported oil just as well as corn does. And it would accomplish it with fewer food and environmental trade-offs."
Underscoring that point, Paulson mentions the reduction in the ethanol tax credit that likely will be part of the Farm Bill. The proposal would drop the current 51-cent a gallon ethanol tax credit down to a 45- or 47-cent a gallon credit, while at the same time creating a $1.01 a gallon tax credit for cellulosic ethanol. There are yet no commercial-scale cellulosic ethanol producers. (Read more)
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