$2 or higher gas - Can ethanol make a comeback? Message Board

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Non-Tech : $2 or higher gas - Can ethanol make a comeback?

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Dec 23 3:59 PM EST

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From: richardred	8/15/2007 1:21:04 PM
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Fitch: Ethanol Mandate to Hurt Refiners Associated Press 08.14.07, 10:55 AM ET Fitch Ratings said Tuesday that legislation working its way through Congress to raise renewable energy use mandates will have a "generally negative effect on the U.S. refining sector" due to lower demand for gasoline and new indirect competitors to the refiners. "Further expansion of ethanol also raises the prospect of saddling refiners with additional infrastructure costs, on both the transportation and retail sides, and enforcement responsibilities," according to Fitch. The ratings agency also said that increased uncertainty about refining investments may deter prospective investors and "encourage energy companies to continue to deploy cash to fund shareholder-friendly activities." The Energy Policy Act of 2005 mandates 7.5 billion gallons of renewable fuel use in the U.S. by 2012, but proposed legislation would increase the requirements to 36 billion gallons per year by 2022. Fitch said many of the legislation's specifics remain unresolved, but "several concerns for refiners have already emerged." forbes.com

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