Washington – On November 24, the European Union (EU) initiated anti-dumping and countervailing duty investigations regarding U.S. exports of ethanol to Europe and current U.S. policies surrounding ethanol production and use.  Specifically at issue is the expiring volumetric ethanol excise tax credit, or VEETC, available to blenders of ethanol and gasoline.  Allegations by EU ethanol producers suggest that U.S. ethanol exports to Europe are taking advantage of the tax incentive before export, thus lowering its price and harming EU ethanol producers.  The Renewable Fuels Association (RFA) responded to these allegations when the first complaint was filed here.

Responding to the launch of the EU investigations, the RFA issued the following statement:

“The RFA is working with other industry groups to encourage all U.S. ethanol producers to cooperate with the EU investigations.  The RFA will continuously monitor the status of these investigations and will take any necessary steps to ensure the U.S. ethanol industry is not unjustly penalized.

“Importantly, domestic ethanol producers are not eligible for VEETC. That tax incentive is specifically made available to gasoline blenders, marketers, and other end users. Therefore, we believe that U.S ethanol producers should not be the focus of any potential European action.  Moreover, VEETC will expire at the end of 2011, rendering the VEETC portion of this investigation and complaint irrelevant moving forward.”