Most ethanol in Australia is made from starch, which in turn comes from
wheat. In other words, this is a plan to run our cars on food when half
the world is starving.


Ethanol not the answer: Kohler


ALAN KOHLER: I must be missing something with ethanol. This week, the
Prime Minister, Mr Howard, put Australia's oil companies in a room and
wouldn't let them out until they agreed that his target of 350
megalitres of ethanol production by 2010 was achievable. They didn't
commit to it but they agreed it could be done.


Most ethanol in Australia is made from starch, which in turn comes from
wheat. In other words, this is a plan to run our cars on food when half
the world is starving. Ethanol costs more to make than petrol, so it
needs subsidies from the Government estimated at $118 million a year.


The wheat is brought to Nowra from western NSW by trucks that burn
diesel. It's then put through an eight-stage process that uses steam at
each stage. The steam is generated by burning coal.


The report of the government task force on biofuels is equivocal, to
say the least, about the environmental and cost benefits of ethanol. It
says the principal benefit of the policy is regional development - not
just a benefit but the main one. That's because a new plant has to be
built, providing 648 jobs. It will use grain and molasses as feed stock
- more food in the fuel tank.


Not mentioned in the report is the name Dick Honan, the main
beneficiary of this policy. His company, Manildra, produces all the
ethanol in Nowra and will make millions from increasing output to 350
megalitres a year. He also seems to be a prime ministerial friend and a
big donor to the Liberal Party. Maybe that's what I'm missing.
Kohler