Governors' Group Reportedly Seeking Increased Ethanol Use

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hirty-three U.S. governors are seeking to expand federal mandates for the use of ethanol as a fuel additive, the Wall Street Journal reported Tuesday.

The Governors’ Energy Coalition plans to release a report this week supporting production of 8 billion gallons of the additive by 2012 an for new incentives to make at least 10% of it from a new process using cornstalks, wheat and rice straw, the Journal said.

The plan would reduce U.S. dependence on foreign oil, the paper reported, citing the report.

Ethanol is a gasoline additive. Gasoline prices have skyrocketed in the past month, rising more than 28 cents since March 7 to four consecutive weekly records and hitting $2.28 a gallon nationwide Monday, according to the U.S. Energy Department.

But the oil industry — including the American Petroleum Industry — and congressional representatives from oil-producing states plan to fight the plan, the Journal said. Instead, they want to restrict ethanol to 5 billion gallons a year.

U.S. ethanol production has risen to almost 3.5 billion gallons a year as of 2004, from about 1.5 billion in 2000, the paper reported.