SmartEnergyViews

The State of Tennessee is considering a 2.5 cent per-gallon ethanol subsidy. The "pilot" program would target nine counties. A Pilot Oil lobbyist is promoting the bill. According to new reports, the cost would be somewhere around $3.3 million, based on an expected output of 60 million gallons from a producer in Knoxville. The governor is also proposing a $40 million "biomass ethanol production plant" in Oak Ridge.

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Is ethanol the right path to pursue? Some experts say it takes more petroleum to produce ethanol than it replaces and that it's a net energy loss. It seems like a primitive solution, too. We need bigger ideas. And there's already a 51 cent per-gallon federal ethanol subsidy, not to mention corn subsidies. And what will increasing demand for grains to make ethanol do to food prices and world supplies?

What if we used the $3.3 million to provide hybrid tax credits instead? A $1000 hybrid tax credit would encourage 3300 new hybrids on Tennessee's roads. Throw in the $40 million for an ethanol plant, and that would stimulate purchase of 43,300 new hybrids.

If you figure 15K miles per year at 20MPG v. 15K miles per year at 35MPG, that's a reduction in fuel consumption of more than 14 million gallons per year. Throw in the federal subsidies, and we could all be driving free hybrids! Well, not quite, but you get the picture.