The current biofuels madness may be such a case.

And another one is the complete farrago of emissions trading, carbon credits etc etc.

A market solution based on the energy content of carbon in fuel might well work: a market solution based on carbon emissions has no chance, but is a nice little earner for the usual rent-seeking suspects - ie the intermediaries - and preferable to the alternative......

"The future is already here -- it's just not very evenly distributed" William Gibson