There is some significant energy legislation being enacted in the United States that should result in the tripling of ethanol use by the year 2012. There is great need for ethanol fuels in certain parts of the United States where there is too much of carbon monoxide as well as ozone pollution and in any case, there is need to use ethanol which can considerably reduce greenhouse gas emissions and provide cleaner air.
Ethanol became increasingly popular after Congress passed an energy bill that required the U.S to use 7.5 billion gallons of renewable fuels come the year 2012 and ethanol producers have cashed in on this boom even though they only have the capacity to produce approximately 4.3 billion gallons. Thanks to MTBE as well more demand for ethanol, ethanol producers can look forward to greater private investment in ethanol plants which should then be able to produce two billion gallons every year.
Skeptics Feel It Is a Deal between Ethanol Producers and Corn Lobbies
There are skeptics who may feel that ethanol producers and the corn lobby are pushing legislation through in spite of the many drawbacks of ethanol in terms of economics as well as environmental factors and mandating additional fuel-ethanol subsidies, they feel is unwarranted and they cannot see grounds that justify including such provisions in the national energy policy.
According to them, ethanol producers do not keep the environment safe because though oxygenates like ethanol can reduce carbon monoxide they are also helping increase in levels of nitrogen oxides that is a smog polluter and ethanol blended gasoline may also give off acetaldehyde, which is a toxic polluter. With new regulations related to energy needs coming into force as well as rising gas prices, ethanol producers can expect a bonanza because ethanol will be strong as gasoline prices stay strong and corn prices remain low.
Ethanol Companies Strike it Rich
A case in point with regard to an ethanol producer striking it rich could be The Andersons Inc., which until recently was relatively unknown but had sales of one billion dollars thanks to its ethanol production which was a natural step for it to take, given its network of grain elevators coupled with a large rail fleet.
Shares of Archer Daniels Midland Co., which is the country s biggest ethanol producer, have risen spectacularly and those of Pacific Ethanol, another major ethanol producer have almost doubled showing the general good health of ethanol producers. Even, The Andersons Inc. has seen its stocks rise and are now valued manifold times greater than their original value. The general outlook for ethanol producers thus looks good at the moment.