Ethanol Market Ethanol Is a Term Paper

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This growth has attracted the attention of major industry leaders such as General Electric and Cascade Investment LLC, which has invested $84 million into Pacific Ethanol.

Despite the favorable outlook and the generally accepted need for renewable energy sources, there are those who are opposed to the source for several reasons. According to Lewis, for example, even while the growing ethanol market may be providing an increase in job opportunities, income is taken away from working families within the oil industry. Obviously therefore, the oil industry and its affiliates will be in opposition to the growing use and mandates for ethanol. Furthermore, the claim is that the ethanol market is dominated by a few giant producers such as Archer Daniels Midland. This is neither a fair distribution of the income from the new market, nor a fair distribution of jobs. The argument related to this is that the existing fuel industry wealth is transferred from honest, hardworking smaller businesses to a number of huge producers, rather than increased.

In terms of economics, federal opposition to the market claims that, while the overall production cost of fuel is lowered by ethanol, there is nonetheless an increase in gas tax, which affects the consumer unfavorably. Projected gas prices will then increase by 9.6, 7.1 and 4.

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0 cents per gallon in California, New York and the Midwest states, respectively. Another opposing claim is that the marketplace is distorted by the Government's $10 million subsidy for ethanol. Feed grain and consequently the chicken and pork markets are specifically affected, as less grain is available for feed.

Proponents of the ethanol industry include mostly environmentalists and scientists searching for new sources of renewable energy. Groschen is for example positive regarding the future of the market and its effects not only on the state of air pollution, but also on the general job market. Specifically, Groschen addresses the Minnesota ethanol program, and thereby refutes the argument that wealth is transferred from several small businesses only large producers. In Minnesota, the focus is specifically on the farming community and its role in producing ethanol.

The ethanol market shows great promise in the future. The market drivers include both economic, political and environmental issues. In terms of the opposing points-of-view, it appears that the focus of argument is rather narrow. Global research and development are necessary in order to determine the true benefits and dangers of replacing conventional fuels with ethanol compounds. It is nevertheless encouraging that research into renewable energy sources is ongoing......

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