Biofuels could provide a means of reducing two major problems: oil dependence and global warming emissions from transportation. Yet despite numerous government programs and subsidies, biofuels are not yet measuring up to their potential. Corn ethanol production has more than tripled in the last five years, driven by mandates for biofuel consumption, tax credits, and other programs. While this support has launched a major industry, it has also had unintended consequences. Most important is that the increased demand for corn is straining the agricultural system and environment. Moreover, with almost a third of the US corn crop now going to ethanol, the continued growth of biofuels can no longer rely on making food crops into fuel. Instead, growth depends on the successful and timely commercialization of the next generation of biofuels: cellulosic biofuels made from grass, wood waste, or even garbage.
This report from the Union of Concerned Scientists sets out a plan for accelerating cellulosic biofuels to commercial scale and for cleaning up all biofuels. The first part of the plan is to establish “The Billion Gallon Challenge,” which would provide investment tax credits and loan guarantees to support the first 1 billion gallons of an¬nual cellulosic biofuels production capacity. The second part is to replace existing biofuels tax credits, as they expire, with a Biofuels Performance Tax Credit that supports all biofuels based on their performance in replacing oil and reducing global warming emissions.
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