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Dairy Campaign hopes to end corn ethanol subsidies

POSTED January 17, 2012 9:22 p.m.

California Dairy Campaign Field Representative Joe Melo testified last week before the California Assembly Transportation Committee calling on lawmakers to pass legislation, AB 523, to end state subsidies for corn ethanol production. AB 523 passed out of the Assembly Transportation Committee and is now on its way to the Assembly Appropriations Committee.

“CDC strongly supports AB 523 which would end state funding for corn ethanol programs,” testified Melo. “We thank Assembly Member Valadao for introducing AB 523 because corn ethanol is an inefficient fuel source that provides no real environmental benefits and drives up the costs of food and feed.”

“Dairy producers throughout the state continue to pay record high feed costs due in part to increased demand for corn for ethanol production,” said CDC President Joe Augusto. “CDC successfully fought for the elimination of the $6 billion federal ethanol program and now today members of the Assembly Transportation Committee voted unanimously to end state programs that provide incentives for corn ethanol production,” added Augusto. “We commend members of the committee for passing this important measure.”

An Iowa State University analysis concluded that ethanol subsidies are no longer necessary to keep the ethanol industry profitable. Proponents of ethanol subsidies contend that corn ethanol is necessary for energy security. The Government Accountability Office concluded that ethanol results in more greenhouse gas emissions than gasoline when the indirect land use changes, such as the clearing of forests because corn acres are diverted to make fuel, are factored into the equation.

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