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Posted on  

June 3, 2003

A vote to boost use of ethanol could benefit the Midwest

By MATT STEARNS
The Kansas City Star

WASHINGTON -- Midwestern corn growers - and the Missouri and Kansas economies -- could get a big boost from Congress this week, as the Senate debates mandating increased use of ethanol.

The corn-based gasoline additive is touted by its producers as a clean-burning way to meet federal air quality standards and reduce American dependence on foreign oil.

A bipartisan group of Senate ethanol supporters will try, through an amendment to the energy bill, to more than double the amount of ethanol used in gasoline refineries, from 2.13 billion gallons last year to 5 billion gallons in 2012.

"This is a fuel that is at the crux of energy independence for the country, at the crux of job creation and growth, and of the environment," said Sen. Jim Talent of Missouri, an ethanol proponent.

Opponents say ethanol is not an environmental panacea and could actually increase smog problems. Plus, they argue, forcing more ethanol use will only raise gasoline prices on the coasts, hurting consumers. Sen. Dianne Feinstein of California called ethanol a "hidden gas tax."

A vote on the amendment doubling the required output could come as soon as today. A similar provision already passed the House.

The amendment is sponsored by an odd but potent political couple: Majority Leader Bill Frist of Tennessee and Minority Leader Tom Daschle of South Dakota. Talent had unsuccessfully tried to get the amendment added to the bill earlier.

Many observers expect the amendment to generate broad support on the Senate floor.

"With a Frist-Daschle amendment, you're sending a pretty good message," said Mark Palmer, a lobbyist for the National Corn Growers Association. "I think this is the first time the two of them have done anything together."

Nevertheless, opponents such as Feinstein could use procedural strategies, such as a debilitating series of amendments, to stall the effort to death.

Much is at stake for Missouri and Kansas. The two states were the seventh- and eighth-largest producers of ethanol in 2002, according to the Renewable Fuels Association.

There are two ethanol plants in Missouri: one in Craig and one in Macon, which together have an 80-million gallon production capacity. Five plants in Kansas have a capacity of 79.5 million gallons. More plants are planned in both states. The largest ethanol producers, by far, are Illinois, at 766 million gallons, and Iowa, at 695 million gallons.

While Missouri and Kansas produce a lot of ethanol, they are not among its largest users.

Federal statistics for 2001 (the last year available) show that Missouri ranked 15th in the country in ethanol use, with about 23.6 million gallons. Kansas ranked 30th, using about 2.1 million gallons.

Missouri's use of ethanol is weighted heavily toward St. Louis because of that region's struggle to meet federal clean air requirements.

Several experts said the usage numbers are probably 5 percent to 10 percent higher now.

Mandating increased ethanol use would probably lead to three plants being built in Missouri, according to a study commissioned by the Missouri Corn Growers Association and the Missouri Corn Merchandising Council.

The study claims the increased capacity of the five plants together would create thousands of jobs and increase state and local tax revenue by $87 million annually.

"We see this as a tremendous opportunity for Missouri, in multiple ways," said Fred Stemme, spokesman for the association. "There's the benefit for farmers with the increased demand for corn. It's also a benefit because of the economic impact. And there's also the clean air benefit."

Increasing the use of ethanol is expected to help air quality because it is not a fossil fuel, so it burns cleaner.

But not everyone agrees that it would be an environmental help.

"Ethanol may reduce tailpipe emissions, but it causes gasoline to evaporate 15 percent more quickly," said Blake Early, an environmental consultant with the American Lung Association. "Evaporating gasoline is becoming a bigger and bigger percentage of smog problems" associated with fuels.

However, the push for ethanol leaves many environmentalists in a difficult spot. That's because ethanol's increased use would come at the expense of methyl tertiary butyl ether, another additive used to help gasoline burn cleaner.

Methyl tertiary butyl ether has been linked to groundwater contamination and is considered a potential carcinogen. The Frist-Daschle amendment would phase it out over four years. The additive already has been banned in New York and California.

As much as environmentalists are suspicious of ethanol, they despise the additive, so it has been difficult to marshal resources to fight increased use of ethanol.

Ironically, the senators from the states that banned methyl tertiary butyl ether have led the fight against ethanol. They say that because most ethanol is made in the Midwest, and it is expensive to produce and ship, consumers on the coasts would end up paying more for gasoline. Estimates of the cost increase range from 1 cent to 10 cents per gallon.

Sen. Chuck Schumer of New York has said there are cheaper, more efficient alternatives than either methyl tertiary butyl ether or ethanol.

"You should keep the Clean Air Act requirements, but allow regions to meet them in ways that best suit them," said an aide to Schumer.

The aide said the Frist-Daschle amendment is written so vaguely that states unlikely to use ethanol, such as New York, could end up underwriting ethanol production.

"The same argument can be used about any alternative renewable fuel," Talent said of Schumer's concerns about price. "The question is, do we want to have renewable alternative fuels or not? Ethanol is the leader in cost and availability."

 

 

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