Bush set to give ethanol industry its biggest boost yet

WASHINGTON: After three decades of surviving mostly on tax subsidies, the ethanol industry is poised on Tuesday to get its biggest endorsement yet as a potential homegrown alternative to gasoline.

In his State of the Union address, President George W. Bush is expected to call for a huge increase in the amount of ethanol that refiners mix with gasoline, perhaps to as much as 60 billion gallons, or 227 million liters, annually by 2030 — an amount equal to more than 40 percent of the country's current gasoline consumption.

For an industry once dominated by a single powerful producer, Archer Daniels Midland, ethanol has come a long way, joining the oil industry and producers of major agricultural commodities as an entrenched political force in Washington.

But with dozens of new ethanol plants designed to turn corn into fuel coming online this year, the ethanol lobby is facing a critical point. The political reality is that corn's days as the chief crop for making the fuel are numbered.

Corn-based ethanol can reduce America's dependence on foreign oil. But it does little if anything to improve energy efficiency, and the lobby's mounting concern is that relying on corn is leading to collateral damage in other parts of the agricultural economy and threatening the country's status as the world's leading corn exporter. The big increase in the works could even mean that consumers would end up paying more at the supermarket.story continued