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August 29, 2008 | Jim Lane | Comments 0

Today in Biofuels Opinion: “We sort of hoped our lawmakers would have recognized the negative effects of the ethanol mandate before they mandated it.”

From an editorial in the Baker City (OR) Herald: “Ethanol was supposed to boost Oregon’s economy and clean our air — a pretty neat trick. Turns out ethanol knows a couple other tricks that aren’t so neat. Lowering your car’s gas mileage, for instance. And raising your food prices. And, possibly, dissolving plastic or rubber parts of your vehicle….Several lawmakers who voted for a bill requiring gasoline sold in the state to contain 10 percent ethanol now say the law ought to be overturned. In the meantime, though, Oregon drivers, as Rep. George Gilman of Medford put it, will continue “suffering from the unintended consequences of this new law.” Gilman, by the way, voted for the bill, along with 52 of his colleagues in the Oregon House. The bill passed the Senate by a vote of 24-3….We sort of hoped our lawmakers would have recognized the negative effects of the ethanol mandate before they mandated it.

From Seeking Alpha: “[In the 3rd quarter, Pacific Ethanol's] in-house production of ethanol will surpass resales volume…If PEIX can slowly substitute its own ethanol for ethanol resold in past quarters, to the same customers, PEIX can expand its margin…in other words, if its margin is 1 cent on resold volume, it can make 5-10 cents on in-house production. So, even if the spread between corn and ethanol stabilizes, better margins from selling PEIX home-made rather than resales volume of ethanol can create a wider operating margin than during the plant construction phase. Kudos to PEIX for developing a marketing business ahead of the construction completion of its plants.”

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