The tax credit for ethanol is an example of a cost ineffective subsidy.
The cost of reducing CO2 emissions through this subsidy exceeded $1,700
per ton of CO2 avoided in 2006 and the cost of reducing oil consumption
over $85 per barrel.
I am not shocked, but it is worse than I had thought. Here is the full paper. But the funny thing is, that’s not even the worse thing I read about biofuels today. Courtesy of Daniel Akst, try this article:
…a growing body of scientific evidence suggests these gasoline
alternatives will actually boost carbon-dioxide levels and thereby
aggravate the problem of global warming. A study published in
the latest issue of Science finds that corn-based ethanol, instead of
reducing greenhouse-gas emissions by a hoped-for 20%, will nearly
double the output of CO2 and other gases that trap the sun’s heat. A
separate paper in Science concludes that the clearing of native
habitats around the world to grow more biofuel crops will lead to more
Or try this ungated version of a similar result. Wonderful.