Gas prices could increase due to an expired subsidy
Gas prices could soon jump five cents because of something Congress didn't do.
On January 1, a 30-year-old federal ethanol subsidy expired. The subsidy was about a 4.5 cent tax break per gallon of ethanol. Congress opted not to renew the subsidy and now gasoline blenders must pay more--a price which could be passed on to consumers.
It is cheaper to produce ethanol than gasoline and some say the industry no longer needs to be propped up.
"Subsidies should go away," said Matt Hartwig with the Renewable Fuels Association. "You should put a subsidy in place to help growth and industry. But once that foundation is built, it's time to let them go."
For some, the prospect of higher gas prices is a motivation to look for alternative transportation.
"I have a scooter," said motorist Ronnell Showell. "Put $3 in there and I can ride 120 miles."