Dead Tree Edition has been closely following the various boondoggles over so-called “black liquor”:

Six months after questioning whether it would benefit from "Son of Black Liquor", International Paper announced Thursday it got $40 million of the bogus eco-fuel tax credits. The giant papermaker received the Cellulosic Biofuel Producer Credits in the 4th Quarter of 2010 for burning black liquor, a pulp byproduct, to power its pulp mills in 2009. As with the original black liquor credits -- the Alternative Fuel Mixture Credits program that gave more than $2 billion in taxpayers' money to IP during 2009 -- CBPC (Son of Black Liquor) was intended to spur development of new bio-fuels but mostly rewarded pulp mills for doing what they would have done anyway.

In the event you have not been following the controversy over black liquor, Bloomberg succinctly defines it thusly:

The tax credit is an incentive to mix an alternative energy source with carbon-based fuel. Papermakers already generate electricity by burning a wood byproduct from pulp-making called “black liquor.” To qualify for the windfall they are adding diesel fuel to the black liquor, following the letter of the law while violating its spirit, said Verle Sutton, editor of the Reel Time Report, a unit of Los Angeles-based Forestweb Inc., a provider of data on the paper industry. “It’s an absolute government boondoggle,” Sutton said. “These companies were not using fossil fuels. They only started because they needed it for the tax credit to work. So there’s a negative to the environment, not a positive.” ... Companies that claim the tax credit may bring in more cash this year from the U.S. government than they do in revenue, said Brian McClay of TerraChoice Market Services Inc., a pulp market data provider in Montreal.

In the follow-up CBPC (so-called Son of Black Liquor), the muck in question did not need to be mixed with diesel to qualify for the credits. The DTE report points out that while the mills were not all that certain whether black liquor would qualify for the CBPC credits, they "would have to return some of the AFMC money to receive the more lucrative CBPC credits."

Rock-Tenn sees things differently. The packaging manufacturer's most recent annual report says AFMC "is not taxable for federal or state income tax purposes." But it estimates it will eventually net $112 million by paying back the original black liquor credits to get the more lucrative Son of Black Liquor money.