Obama Sets Up Biofuels Working Group

cornThe blogosphere is abuzz today over the just-announced Biofuels Interagency Working Group, which throws a lifeline to the troubled ethanol industry. The group, headed by the secretaries of the Department of Energy, Environmental Protection Agency and the Department of Agriculture, has been given the charge by President Obama to make biofuels friendlier to the environment while encouraging the development of more of those “flex-fuel” cars that are so popular in the Midwest.

The formation of the working group—the administration’s first major statement on the touchy issue of enthanol use and production—will spell relief for the depressed industry, which has shuttered production facilities and delayed or canceled building new plants due to lower gas prices, higher costs for corn, and the credit crunch. Through the working group, the government will assist in refinancing some of the troubled operations and guaranteeing loans for construction of new biofuel projects. Recent earnings announcements from companies heavily-invested in the government-subsidized enthanol program have been dismal. ADM, for one, said today their third quarter profit dropped 98 percent, with a $167 million decline in the biofuel division alone. Read More >