Is the fuel they are adding refinery grade diesel fuel (made from crude oil) or is it bio-diesel?

1 billion dollars from the federal government...should help out a bit..:)

corporate welfare is not cheap!

Funny, now they have to burn diesel instead of natural gas to become environmentally sound. Damn Americans, they are so far behind, they change the rules and claim to be leaders.

I suspect that few people understand what the American subsidy is all about.


Pulp mills have always burned black liquor in their pulping processes. Black liquor is a by product of producing pulp and it is recycled and used as a fuel to generate steam, that runs the pulp mills.

What the American mills did was to add some refinery grade diesel fuel to this process., That in itself would not make any sense, and would actually cost them some money, however because they added diesel fuel to the black liquor they became eligible for money from the Federal Goverment under the bio fuel program.

So in effect the pulp mills were saying that since they were using diesel in the process they were eligible, and to this point in time they are getting millions from the Federal Government.

There are a number of problems with what they are doing.

(1) The whole idea of the bio fuel subsidy, was to use less diesel, and this process actually uses more.

(2) The pulp mills are trying to take advantage of a rebate program that they are not really entitled to.

(3) If the IRS rules that this rebate is subject to taxes, then the amount generated for the pulp mills will be consideraly less, plus they will have to pay taxes on all the monies they have collected to date.

(4) The subsidy in question expires at the end of this year, and if it is continued there is a good possibility that the process of using diesel in the black liquor process will be excluded.

In the meantime the Canadian and other Governments have to put in a similiar system to keep the playing field even, and to put pressure on the American to kill the program.

Seems strange that our Canadian federal government has reacted* so quickly. Have they had any experts study the problem yet?
*react: what a government does to try to please some of the people, some of the time. Pal is right, the yankees are exploiting a loophole in their own law.
metalman.