Ethanol Subsidy Killed in Senate

Farm Progress reports that two recent Senate votes had ethanol supporters scrambling. The first, an amendment rushed through the process by Sen. Tom Coburn (R-OK) failed on a 59-40 vote. However, a similar amendment from Sen. Dianne Feinstein (D-CA) got a better response with a 73-27 vote win. This amendment would end the 45-cent-per-gallon blender’s credit for ethanol and stop the 54-cent-per-gallon tariff on ethanol imports.

Another amendment the Senate considered last week came from Sen. John McCain (R-AZ) and it failed. His would have prevented spending any money on blender pumps or other ethanol infrastructure. The ethanol subsidy is set to expire at the end of 2011, and renewal doesn’t appear possible.

A bill written by Sen. John Thune (D-SD) and Sen. Amy Klobuchar (D-MN), would phase out the subsidy over three years and share some savings back to the industry in the form of infrastructure investment. The Feinstein and McCain amendments were made to a Senate bill that may not eventually pass, but this is a clear message regarding Senate support for ethanol. ◆