Ethanol, the much-maligned biofuel of the hour, is gaining
some traction on the Hill. Today I attended a conference on the global food and
energy crisis at the American Enterprise Institute, where Senator Richard Lugar
argued (pdf link)
that the United States should lift its existing 54-cent tariff on imported sugarcane ethanol from Brazil:
There are striking examples in oil
and natural gas, where increased political interference puts upward pressure on
price…To demonstrate leadership, the United
States should lift its tariff on Brazilian ethanol that
now shelters the U.S.
industry.
Proponents of sugar ethanol say that the critics have it all
wrong: not all biofuels are created equal, and sugar ethanol is far
greener and cheaper than its corn-based pariah cousin. Sugar ethanol can
produce over eight times the amount of energy expended in its production
(versus a 2:1 ratio for corn ethanol production, or nearly nil, depending on whom
you talk to), and it doesn’t divert crops from heavily relied-upon food
stocks. The potential downsides? Reports of forced
labor in Brazilian sugarcane fields and the alleged threat to the country’s
ecosystem.
All things being equal, even if we started importing cheaper
sugar ethanol, it probably wouldn’t provide immediate relief for Americans at
the gas pump. Sugarcane ethanol is a
fuel additive that contributes only a few cents to the current price of
American gas. Nevertheless, the U.S.
could conceivably raise the amount of sugarcane ethanol in its fuel and make a
more significant dent in gas prices.
McCain, ever the free-tradist, joins Senators Lugar and Dianne Feinstein in supporting the removal of the sugar ethanol tariff. Obama--with
his close
ties to the corn ethanol industry--is an opponent, saying that relying on
such energy sources would compromise America’s “energy independence.”
But America
is far from being liberated from foreign energy sources any time soon, and to
exclude such options wholesale smacks of sheer protectionism.
A more realistic objective would be to diversify America’s energy
sources--not only by developing domestic energy sources and alternative fuel
technologies, but also by cultivating foreign energy sources that are secure
and sensible. For America, Brazil would be
a fairly benign shoulder to lean on. The country doesn’t carry the same
security risks as other energy-rich nations, linking us to autocratic regimes or
explosive regional conflicts. And the ethanol issue might be a good opportunity
for the U.S. to build closer
ties to Latin America, one of the most neglected
areas of the world under the Bush administration. The human rights and
land-use concerns certainly warrant further investigation, but sugar ethanol
could ultimately prove to be a sweet deal.
--Suzy Khimm