Archive for April 28th, 2009

Liquored up on subsidies

Tuesday, April 28th, 2009

The U.S. subsidy is a tax rebate of 50 cents a gallon for converting from fossil fuel to a mixture of fossil fuel and biofuel. It was approved by the U.S. Senate in 2005 to increase the use of biofuel in highway vehicles. But in 2008, kraft pulp mills who have traditionally used black liquor – a by-product rich in carbon – for producing heat and energy, realized they could qualify for it if they added some diesel fuel to it. The resulting fuel meets the tax guidelines but burns more fossil fuel rather than less, turning the intent the legislation upside down.

… (full Vancouver Sun article here)

Luckily the outcry against this perverse “black liquor” subsidy isn’t limited to Canada – see this Wall Street Journal article.  I just hope that common sense prevails before the few remaining unshuttered Canadian pulp mills are forced to shut down.