Enviromental Economics

Running Head : Emission , Taxation and Subsidies

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Abstract . 3

Problem Statement 5

Literature Review . 6

Conclusion . 15

References Bibliography 16

Abstract

This study will provide in depth information about what measures are being taken by the government of the United States in to make people switch to ethanol and clean fuel driven vehicles

and energy efficient products . Secondly , a discussion of the tax credits will be mentioned . These have been a source of encouragement to people using such goods which are atmosphere and environment friendly and have been a source of tax cuts . These tax cuts (as determined by EPACT ) relate to different sectors , such as , automobile , building , energy efficient products ' manufacturers etcetera

The US consumption of oil is 70 ,000 barrels of oil each day , over 200 ,000 ,000 have been invested to find ways to extract ethanol from plants so that foreign dependence of oil could be controlled . It is hoped that by the year 2017 , this dependence would be reduced an 15 of gasoline consumption would be replaced by ethanol

Due to a rising increase in demand for corn , it 's prices are increasing drastically , especially , when it has to fulfill two need one is the demand for ethanol as fuel and the second being corn being a consumer product in the form of food . Therefore , other substitutes of ethanol are stressed to be used up as a source of bio fuel

Nathanael Greene , the senior researcher at the Natural Resources Defense Council urges to find new ways to extract ethanol from other plants stressing the need to even use algae to get ethanol

Green house emissions need to be controlled , else scientists fear that by 2050 some global warming disaster would erupt because of 2 parts per million of carbon dioxide increased in the atmosphere annually . After the industrial revolution production of goods increased massively which also had a side effect the carbon emissions kept on increasing rapidly constantly ruining the Earth 's thermostat . As the result of this , we are not experiencing natural disasters in the form of severe change in climatic patterns and seasons in different parts of the world . Problem Statement

The report will determine whether the US economy 's dependence on foreign oil could be reduced by the production of crops like corn and other plants which are not consumed as eatables . Likewise , it is necessary to add a percentage of ethanol to gasoline in to obtain an optimal level of environment friendly fuel whose emission would not be hazardous as just that of gasoline alone

E85 as the name suggests , is a fuel which has a minimum of 85 ethanol or any other clean fuel combined with the remaining percentage of gasoline . This ratio is also important for pumping stations to have in to gain tax credit up to 30

The purpose...