AEC responds to The Wall Street Journal coverage

By Advanced Ethanol Council | January 30, 2013

The Wall Street Journal editorial board has once again demonstrated that it either does not understand why Congress decided to require oil companies to use cellulosic biofuels five years ago or it is not willing to tell the truth about it.

The Journal seems to think that motor fuel markets are free and competitive, and that in the absence of government intervention, fuels like cellulosic biofuels would succeed if worthy. Unfortunately, 100 years of direct and indirect subsidies to the oil industry, coming at a time when the U.S. taxpayer also built out most of the large scale infrastructure that the oil industry relies on today to move its product, has largely suffocated the free market principles that would otherwise reward innovation.

So in order to fix a broken marketplace, Congress decided in 2007 to forcibly diversify the motor fuel marketplace with renewable fuels. And much to the dismay of the oil industry and those who carry their water like the Journal's editorial board, the program is working. The domestic renewable fuels industry has grown exponentially, despite the global recession, in less than 10 years.

The Journal is also wrong to assert that "nothing has changed" in the cellulosic biofuels industry. As shown in an AEC progress report released last month, the cellulosic biofuels industry is breaking through at commercial scale as we speak.

You would think that a newspaper with the ideals espoused by The Wall Street Journal would celebrate the reintroduction of U.S.-branded competition into a broken marketplace. You would think they would lament the distortive effects of oil subsidies and question why cheaper alternatives to oil cannot seem to break into the marketplace. In that world, the Journal would be calling for the comprehensive energy tax reform we so badly need to ensure that the next generation of motor fuels are produced by Americans instead of China, India or Brazil. What we do not need is more yellow journalism about ethanol from The Wall Street Journal editorial board.