Redirecting Oil Subsidies

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A general introduction to the issue of oil subsidies, and how reforms could benefit ethanol. It references Earth Track's work (extract below), thought makes only a passing mention of our detailed work on ethanol subsidies though released just a year prior to this article.

..."Instead of addressing the social and environmental costs of global oil addiction, EPM chose to focus on the more quantifiable, direct costs of tax breaks and subsidies for the oil industry that affect taxpayers. EPM reviewed the subsidies given to the oil industry and explored how the political climate, as it relates to subsidies, is changing, and what that means for the ethanol industry.

A subsidy transfers risk or funding from the private sector, as defined by Doug Koplow, founder of Earth Track Inc. "Subsidies represent government policies that benefit particular sectors of the economy," Earth Track's Web site says. "When these subsidies reduce the prices of natural resources or natural-resource-intensive products, they encourage additional pollution and habitat destruction."

Earth Track compiles information on government interventions (subsidies and taxes) in energy markets. In 1998, Koplow calculated the net federal subsidies given to the oil industry. In October 2006, he completed an analysis of government support for ethanol and biodiesel in the United States, titled "Biofuels At What Cost?" This year, he hopes to reevaluate the subsidies given to oil. "They periodically try to refute claims that they get any subsidies," Koplow says of the oil industry. "Everyone has a reason why they think they deserve it"...