The Canadian Renewable Fuels Association today praised the federal government for taking steps to build a strong ethanol industry in Canada. Today's budget set up a fund worth C$1.7 billion through which priorities like ethanol will be funded as part of the government's Kyoto commitments. "The ethanol industry is ready, willing and able to take advantage of that fund tomorrow," said Bliss Baker, President of the CRFA said in a release. "We have projects ready to go, business plans developed and investors waiting for the green light," he added. While details of the fund are still to be worked out, the CRFA plans to move quickly to work with officials to implement the Budget commitment. "The challenge now is to get on with it. Ethanol is ready to go," stated Baker. The CRFA has worked closely with the National Liberal Rural Caucus to lobby the government to set a mandatory level of ethanol in gasoline and introduce targeted incentive programs for grain-based and cellulose ethanol. In the past several weeks, over 100 Liberal caucus members - from both rural and urban ridings - have sent letters of support to Finance Minister John Manley. According to the CRFA, a home-grown ethanol industry would create new markets for over 100 million bushels of Canadian grain and generate over $1.5 billion in direct investment in Canada, increasing economic development in Canada's rural areas and creating expanded market opportunities for Canadian farmers. It would also help Canada lower greenhouse gas emissions (GHGs) by over 30 megatons during the Kyoto commitment period of 2008 to 2012 while creating a cleaner, healthier quality of air for Canadians. But the industry has warned that mandating ethanol content alone will not deliver the benefits to Canadian agriculture or the investment in Canadian ethanol production capacity. A mandate would not change the economics of ethanol production enough in the short-term to kick-start the building of plants. They have further argued that introducing a mandate without adequate domestic capacity would result in ethanol being imported from the US in order to meet the demands generated by the mandate. Ethanol is a high-octane alcohol produced from grains such as corn and wheat. It is commonly mixed with gasoline at 5% or 10% ratio. Any car built in the last 30 years is able to operate on ethanol-blended gasoline without modifications to its fuel system. Some 238 million litres of ethanol are produced annually in Canada, with another 100 million litres imported from the US. With the funding announced today, the industry expects it will meet the production target set out in the government's Climate Change Plan for Canada of 1 billion litres per year in Canada by 2010. Furthermore, ethanol reduces greenhouse gas emissions by up to 50% compared to gasoline. And according to a recent US Department of Agriculture study, ethanol contains 34% more energy than it takes to produce it - contrary to the popular myth about the renewable fuel. The Canadian Renewable Fuels Association represents fuel marketing, fuel producing/processing, energy, agriculture, agri-business, forestry, engineering and environmental organizations as well as researchers and individuals. News International