Ethanol Tax Credit Expiration Getting Ever Closer

(posted by Andy Eubank, Hoosier Ag Today)

NCGA is also hoping congress acts on the VEETC, or Volumetric Ethanol Excise Tax Credit, before it expires on Dec. 31. The President of NCGA, Bart Schott from North Dakota, told Hoosier Ag Today recently he still has hopes of an extension this year.

“I do, and I liken it to a light bulb on the farm that is sometimes dimmer and sometimes brighter, but the switch, the light bulb has never gone off,” he said. “We think that light is getting brighter right now with VEETC. All the ethanol groups are working together messaging one voice, and we’re getting some help from the White House on the tax extension and how to go about it. So I think right now the climate is pretty good to get the extension passed.”

…Every day there is a bigger squeeze on time available for the extension, which is why some are suggesting congress should grant the extension now and debate modifications to tax credits later. A recent study by the Delaware company Entrix says expiration of the credits could mean the loss of thousands of Hoosier jobs.

Schott also told HAT he would love to see an aggressive move to blender pumps in Indiana. His state has more than doubled ethanol consumption in the last year after 76 new blender pumps were installed starting last October. That growth was initiated by a $2 million biofuels blender pump program in which corn growers, the North Dakota Department of Commerce and others collaborated.

Our Take:
We hope the help from the top, and the strength of the coordinated effort by ethanol and farm groups is enough to get this done in time. The time is short before the end of the year, when VEETC lapses. In the current job environment, it’s a setback no ethanol-producing state can afford.

Also, we hope state legislatures and the federal government pay attention to North Dakota’s experience–investment in blender pumps will pay off in immediate increases in ethanol use. Part of the success of that venture is that the VEETC discount is often passed along to the consumer, making ethanol economically attractive. Add that to the fact that ethanol is the right thing to do for our nation’s energy security and economy (keeping dollars and jobs here instead of shipping energy dollars and jobs overseas), and the right thing to do for the environment.

Renewing VEETC is one thing the lame duck session can do that won’t be lame at all.


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