Is Minnesota's Ethanol Push Good Policy or Just Politics? Minnesota Gov. Tim Pawlenty plans to boost ethanol use by mandating that all gasoline sold in the state must contain 20 percent of the corn-based ethanol by 2013. Corn farmers love the plan, as do most environmentalists -- but critics wonder if it's good policy or just good politics. Minnesota Public Radio's Laura McCallum reports.
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Is Minnesota's Ethanol Push Good Policy or Just Politics?

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Is Minnesota's Ethanol Push Good Policy or Just Politics?

Is Minnesota's Ethanol Push Good Policy or Just Politics?

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ALEX CHADWICK, host:

This is DAY TO DAY. I'm Alex Chadwick.

In Washington and across the country, politicians are debating energy policy and how to reduce dependence on foreign oil. Minnesota is the first state to require that all gasoline sold there contain 20 percent ethanol--that's a fuel additive from corn--and do so within eight years. That's one step toward energy independence, according to ethanol supporters, but it's a very expensive step and some critics ask: Is this good policy or good politics? Laura McCallum of Minnesota Public Radio reports.

LAURA McCALLUM reporting:

Ethanol boosters celebrated at a St. Paul gas station as Minnesota Governor Tim Pawlenty signed into law the nation's first 20 percent ethanol mandate. The price at the pump was $2.15 a gallon. Governor Pawlenty says as gas prices go up, ethanol becomes more appealing. As he signed the new law, he boasted that it will make Minnesota, in his words, "the Saudi Arabia of renewable fuels in the US."

(Soundbite of bill-signing event)

Governor TIM PAWLENTY (Minnesota): We are very excited now to once again raise the bar for the entire nation in renewable fuels by not modestly increasing the ethanol in our gasoline but proposing to double it by the signing of this bill.

McCALLUM: Just eight years ago, Minnesota was the first state to require a 10 percent ethanol blend. Ethanol is big business in Minnesota, with 14 plants, many of them owned by corn farmers. The state also subsidizes the industry, paying producers 20 cents a gallon for ethanol in an effort to make it more cost-effective to produce.

One of the few Minnesota politicians who openly criticizes those subsidies is Michael Paymar, a St. Paul member of the state's Democratic-Farmer-Labor Party.

State Representative MICHAEL PAYMAR (Democratic-Farmer-Labor, Minnesota): There's rural members of the DFL who are angry at me for standing up on the House floor and calling this thing a boondoggle, but it is a boondoggle, and it's costing us a lot of money.

McCALLUM: Paymar notes that Governor Pawlenty himself called for reducing Minnesota's ethanol subsidy two years ago. Pawlenty chairs the Governors' Ethanol Coalition and is calling on other states to follow Minnesota's lead, but no other state has gone that far, and car manufacturers don't like the idea. The Alliance of Automobile Manufacturers is concerned that the higher ethanol content could cause engine problems. Spokesman Charlie Territo says manufacturers haven't tested 20 percent ethanol in cars.

Mr. CHARLIE TERRITO (Spokesman, Alliance of Automobile Manufacturers: We're concerned that it could have an undesirable effect on the vehicle emissions systems, on some of the seals in the engine and ultimately have warranty issues for consumers.

McCALLUM: Ethanol supporters say the same concerns were raised about the 10 percent ethanol blend, which was found to be safe for cars. And before Minnesota's 20 percent mandate can go into effect, the state will need a waiver from the EPA, which will study emissions and vehicle performance.

Minnesota's new requirement highlights a debate that's been going on for decades over just how energy-efficient ethanol is. At the center of this debate is David Pimentel, an agricultural scientist at Cornell University. Pimentel's research found ethanol is an energy loser because of the fuel needed to grow corn and process it into ethanol.

Mr. DAVID PIMENTEL (Cornell University): It takes about 1.3 gallons of oil equivalents to produce one gallon of ethanol. Literally we're importing oil from Saudi Arabia and elsewhere to produce this ethanol.

McCALLUM: Pimentel acknowledges that using his calculations, gasoline is also a net energy loser. Pimentel's ethanol findings are disputed by other researchers, including USDA economist James Duffield. Duffield's research found the exact opposite because the corn needed to produce ethanol is renewable. Ethanol supporters tend to cite the USDA studies, while critics point to Pimentel's work.

The debate over the merits of ethanol will continue at both the state and federal levels as Congress considers energy legislation. But as long as Minnesota is the only state with an eventual 20 percent mandate, it seems unlikely that blending ethanol into gasoline will make a sizable dent in the nation's demand for foreign oil. For NPR News, I'm Laura McCallum in St. Paul.

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