Minnesota auditor calls for an end to ethanol subsidies

As one of the biggest corn-producing states in the country, Minnesota has long had a vested interest in promoting ethanol. Governor Pawlenty has called for raising the blend of ethanol in standard pump gasoline from the current 10 percent to at least 20 percent. However, not everyone in Minnesota is sold on the idea of supporting ethanol production. Minnesota's Legislative Auditor's office is calling on the state to stop subsidizing ethanol production. The state has spent $93 million on the payments to producers over the past five years and is scheduled to spend another $44 million over the next three. However, given current economic conditions, the auditors office has determined the subsidizes have not done anything to improve the environment or energy independence situation and the payments should be ended.

The recommendations of the auditor are advisory only and the legislature is under no obligation to follow them. Thus, nothing is likely to change anytime soon.

[Source: Minneapolis Star-Tribune]