Well. The Congressional Budget Office has finally caught up with what CEI has been saying for years – misguided ethanol policies cause higher food prices without providing significant environmental benefits. In a report released yesterday, CBO noted this about food prices:
CBO estimates that the increased use of ethanol accounted for about 10 percent to 15 percent of the rise in food prices between April 2007 and April 2008.
And what about ethanol’s highly touted reduction of greenhouse-gas emissions? Here’s what CBO found:
Last year the use of ethanol reduced gasoline usage in the United States by about 4 percent and greenhouse-gas emissions from the transportation sector by less than 1 percent.
In the long run, if increases in the production of ethanol led to a large amount of forests or grasslands being converted into new cropland, those changes in land use could more than offset any reduction in greenhouse-gas emissions—because forests and grasslands naturally absorb more carbon from the atmosphere than cropland absorbs.
Dennis Avery in a 2006 CEI study pointed this out, as did this CEI 2007 report on unintended consequences of ethanol policy. Also see CEI’s website on ethanol.
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Actually, the report says ethanol caused a .5-.8 percent increase in food prices. Even the Wall Street Journal, which unabashedly says it “hates ethanol” says the study shows that “corn ethanol is off the hook for rising food prices last year, if anybody other than the renewable-fuels lobby is still keeping score.”
The study says the main culprit in rising prices is oil and energy costs. How does using straight gasoline solve that problem? It raises GHG emissions, even if it is by only a little, and it causes food prices to rise even higher. That’s a genius plan.
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