Union Congress lifted the excise tax, making ethanol affordable
again. American farmers had been watching the use of alcohol
engines in Europe with interest when a bumper harvest produced a
grain glut, prompting them to lobby President Theodore Roosevelt
to repeal the $2.08/gallon tax. Roosevelt, an adversary of the
oil industry, backed the Free Alcohol bill and the tax was
repealed. Pure ethanol at the pump dropped to around 14 cents
per gallon, while gasoline hovered around 22 cents per gallon.
Still, only ten ethanol plants were built as a result of the new
law. | || |