Monday, July 27, 2009

Ethanol Fraud means Green Fuel Promises Go Bust

When the EPA recently issued a report anticipating 100 million gallons of cellulosic ethanol production in the U.S. by 2010, it was including 70 million gallons from an Alabama company called Cello Energy.

That's 70 percent of the total U.S. production from one relatively small company, per the EPA.

Bad Move

The government didn't factor in ethanol fraud.

Turns out the Cello was just found guilty in a federal court in Alabama of civil fraud for lying to a major investor about the state of its ability to make ethanol from grass and other woody, non-food materials.

The jury ordered Cello principals to pay $10.4 million in damages after witnesses testified that the "cellulosic" fuel the company was showing to investors was actually fuel derived entirely from petroleum.