Some members of Congress are finally taking notice of how ethanol is driving up gas prices. Unfortunately, they probably aren’t going to do anything about it.
House and Senate energy panels are eyeing the price of ethanol renewable identification numbers, or RINs, which have skyrocketed from pennies a gallon to more than $1 per gallon in recent weeks. That could cost the refining industry $7 billion this year, according to a Barclays analyst as cited by the Financial Times.
“We’ve talked about how they’ve been skyrocketing,” House Energy and Power Subcommittee Chairman Ed Whitfield (R-Ky.) said last week, though he was unsure what action his panel would take.
Refiners and the ethanol industry disagree about the cause of the price spike.
A spokesman for Valero, the largest independent U.S. refiner, said refiners can do only three things about the spike in the short term: Increase gasoline exports to countries that do not have the added RIN cost, decrease the amount of gasoline refined or shift the costs to gasoline consumers. “I suspect a combination of all three things happening with refiners,” said the spokesman, Bill Day. (Read More)
Last week my sixth grader told me they were learning about ethanol and other renewable energy sources in school. I asked if they were told about ethanol driving up the cost of gas. His answer was what you would expect.