Blunt promotes ethanol requirement for Missouri gas

JEFFERSON CITY, Mo. -- Gov. Matt Blunt was touring the state Wednesday to promote a new law requiring most Missouri gasoline to contain a 10 percent ethanol blend.

The requirement kicks in Jan. 1, 2008, and even then, it applies only when the price of ethanol-blended fuel is equal to or drops below the price of regular gasoline. Premium-grade fuel will be exempt from the requirement.

Car engines can run on a blend of ethanol and gasoline as long as the regular gasoline constitutes at least 90 percent of the mixture.

"This renewable fuel standard benefits consumers, our economy, the environment, and Missouri farmers," Blunt said in a written statement. "It means Missouri corn fields will be the oil fields of the 21st century."

An ethanol mandate has been one of his priorities since campaigning for governor in 2004.

Supporters say the requirement will be a boon for corn farmers and lessen dependence on foreign oil, but critics say it goes against free-market principles.

Missouri now has ethanol plants in Craig, Macon and Malta Bend, and a fourth is expected to begin production in Laddonia this fall. Combined, the four plants are expected to produce about 156 million gallons of ethanol annually.

Further expansion is expected to bring production up to 350 million gallons by 2007 or 2008.

Gas stations in Missouri sold 3.27 billion gallons of gas in 2005, according to the Missouri Petroleum Marketers and Convenience Store Association -- meaning 327 million gallons of ethanol would have been needed to meet the mandate if it had been in effect last year.

Blunt's office said farmers can expect an increase of up to 15 cents per bushel for corn as ethanol demand rises. Blunt also has signed state budgets that have more than doubled the subsidies available to farmer-owned ethanol and biodiesel plants.

The financial impact of an ethanol mandate and subsidies on farmers and investors has raised some Democrats' ire, as the governor's brother, Andy Blunt, and other political supporters are investing in a new $80 million ethanol plant planned in Carroll County.

Ethanol plants with a majority ownership of active farmers can qualify for state subsidies, which the Show Me Ethanol LLC plant hopes to receive. Both the governor and his brother have said there is no connection between Matt Blunt's policies and Andy Blunt's new business interests.

Blunt planned stops in Webb City, St. Joseph, Kirksville, Palmyra and St. Louis on Wednesday, with others in Laddonia, Macon and Malta Bend scheduled Thursday. He planned to officially sign the bill Thursday.