Obama Punishes Oil Producers For Failing to Use an Ingredient That Doesn't Exist

Want to know why fuel prices continue to skyrocket?

This year, the Obama Administration is testing out a new revenue model whereby it mandates the use of technology that doesn't exist, then penalizes companies with fees for non-compliance.

Take, for instance, the penalty levied on oil refineries for failing to incorporate a nonexistent ingredient into the motor fuel they produce. According to the New York Times,

when the companies that supply motor fuel close the books on 2011, they will pay about $6.8 million in penalties to the Treasury because they failed to mix a special type of biofuel into their gasoline and diesel as required by law.

But there was none to be had. Outside a handful of laboratories and workshops, the ingredient, cellulosic biofuel, does not exist.

In 2012, the oil companies expect to pay even higher penalties for failing to blend in the fuel, which is made from wood chips or the inedible parts of plants like corncobs. Refiners were required to blend 6.6 million gallons into gasoline and diesel in 2011 and face a quota of 8.65 million gallons this year.

Why isn't anyone challenging these regulations in court? Surely there must be some prohibition on government demands when meeting them is impossible?