Less talked about though is that the end of VEETC also means the end of a 54-cent-per-gallon tariff on imported ethanol. This could prove to be a huge boon for Brazil in particular, where many vehicles run on pure ethanol produced from sugar cane, which has an 8:1 energy-out-to-energy-in ratio. Producing ethanol from sugercane is far cheaper than producing it from corn, about half the cost according to one study. Sure, transporting ethanol from Brazil to America won’t be cheap, but it is a much better alternative to shipping oil from Venuzala or the Middle East.
Hypothetically speaking, Brazilian ethanol without the tariff could be cost-competitive compared with traditional gas-powered engines. There’s still the problem regarding the lack of ethanol fueling stations in this country, but the end of this tariff could have a more profound affect on getting Americans to use ethanol than 30 years of the VEETC credit.
At what price-per-gallon would you consider switching from gas to ethanol-powered vehicles?