Sunday, September 15, 2013

"Wall St. Exploits Ethanol Credits, and Prices Spike" New York Times

"Every time they mix ethanol into gas, or import fuel already blended with ethanol, energy companies get a credit from the government, and that credit can be sold to other companies that don’t blend ethanol to help them meet federal requirements. If refiners fall short of their obligation, they can face fines of $32,500 a day. To monitor compliance, each gallon of ethanol is assigned a 38-digit Renewable Identification Number, or RIN. Six billion of them were generated in the first six months of this year."
"The market in ethanol credits is exactly the kind Wall Street loves: opaque, lightly regulated and potentially very lucrative."
“The last thing we wanted in implementing this program is to get price increases for the consumer,”

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