The CAP Health Check has been promoted by the Commission as an exercise focused on tidying up the loose ends of the 2003 Mid Term Review and adapting the CAP to an evolving set of circumstances for the period 2008 – 2013. However, this is only half the equation. The Budget Review is set to open up a much more fundamental debate on the rationale for European expenditure on agriculture, and in doing so will delve into the very heart of the CAP.
The Commissioner, Mariann Fischer Boel, has been somewhat inconsistent in her characterisation of the Health Check. She started off espousing the reform mantra of ‘One Vision, Two Steps’, in which step two was meant to unlock a more substantial debate on the future orientation of the policy. The visionary dogma is absent in her more recent speeches and instead these debates will now largely be subsumed into the Budget Review, principally the domain of finance ministers, although the current consultation means it should reach a wider audience. The Commissioner has indicated she would like to reflect on the form the CAP should take for the post-2013 period, but clearly this is a debate she does not want to open up until the Health Check is out of the way, when arguably the agriculture portfolio will have been passed on to a new Commissioner following the end of her tenure in 2009.
The key challenge for Mariann Fischer Boel is therefore the extent to which she can conduct the Health Check without it becoming ensnared in much bigger policy questions. It will be difficult for DG Agriculture to separate the Health Check, a process largely concentrated on making technical, administrative changes to the CAP, from the arguably more interesting and decisive dissection of the CAP that will occur as part of the Budget Review, led by DG Budget. In practice, discussions in relation to the Health Check Communication and the post-2013 vision are likely to become deeply entwined and unlikely to take place in the sequential manner that seems to be expected by the Commissioner. This is particularly true given that the Budget Review was kicked-off last week, two months before the Health Check is formally set to get underway.
The US Senate has approved a bill that would require gasoline producers to blend 36 billion gallons of ethanol into gasoline by 2022, an increase from the current standard of 7.5 billion gallons by 2012. The House did not include such a provision in the version it passed, and it is uncertain whether any final legislation will emerge this year and what it will say about ethanol if it does.
Ethanol proponents say a new energy law is virtually inevitable at some point, and that even if it does not pass this year, lower ethanol prices will provide an incentive for refiners to blend more ethanol into expensive gasoline. A higher renewable fuels standard would force refiners and blenders to work faster to process increased amounts.
A strong energy law would also increase investment and research into ethanol production from nonfood sources, like switch grass, and persuade auto companies to make more cars that run on blends well beyond the standard low percentage ethanol mixture, ethanol proponents argue.
“This is an industry that is going to continue to grow,” said Bruce Rastetter, chief executive of Hawkeye Renewables, a private company based in nearby Ames that has two distilleries and two more under construction. “Once you see an energy bill, I think you will see the industry respond again.”
Still, he has dropped plans to build a fifth plant and take Hawkeye public.
http://www.nytimes.com/2007/09/30/business/30ethanol.html?_r=1&hp=&oref=slogin&pagewanted=print