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HomePolicy Articles Article Summary

Ethanol: The Promise and the Peril

Policy Series by Robert Sopuck

Robert Sopuck’s report Ethanol: The Promise and the Peril argues that the Government of Manitoba should not subsidize the Province’s ethanol production industry. Sopuck begins by explaining how wheat is fermented to produce ethanol, which is then used to make ethanol-blended gasoline. There is controversy, he claims, over the economic and environmental effects of this production. On the economic front, Sopuck cites recent studies concluding there is some economic gain to be found in the production of ethanol. As far as the environmental argument, the author maintains the benefits of ethanol-blended gasoline remain difficult to quantify.

Sopuck’s analysis also considers three different models of ethanol production: 1) stand-alone production facilities; 2) integrated facilities that also produce other products; and, 3) integrated facilities that also produce high protein livestock feed. Sopuck concludes that ethanol facilities should be designed to produce a wide range of products. He argues, however, these products should not be supported by government subsidies. Sopuck believes that subsidies increase the risk of price collapse for the ethanol production industry while, at the same time, threatening Manitoba’s feed industry as businesses shift to ethanol production.

Accordingly, Sopuck concludes that the Government of Manitoba should not mandate use of ethanol-blended gasoline, or subsidize the Province’s ethanol production industry.

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Policy Publication Details

Author(s): Robert Sopuck;
Publisher: Frontier Centre for Public Policy [ Visit Website ]
Year Published: 2002; Publisher Type: Research Institute
Publicly Available: Yes Research Focus: Provincial;
Registration Required: No Language: English
Payment Required: No Publication Format: Adobe PDF

Subjects / Categories:

Policy Articles / Environment & Climate / Natural Resources
Policy Articles / Fiscal & Budgetary / Business Subsidies
Policy Articles / Regional & Sectoral / Oil & Gas
Policy Articles / Environment & Climate
Policy Articles / Fiscal & Budgetary
Policy Articles / Regional & Sectoral
Policy Articles / Environment & Climate / Natural Resources / 2002
Policy Articles / Fiscal & Budgetary / Business Subsidies / 2002
Policy Articles / Regional & Sectoral / Oil & Gas / 2002


Keywords / Tags:

Manitoba; ethanol; economic effects; environmental effects; production models; subsidies; price collapse;