Wednesday, September 14, 2005

Missing The Field For The Corn Stalks

by Tom Bozzo

Around these parts, you can find gas stations offering E85 fuel, a blend of 85% ethanol and 15% gasoline, at prices that look like a bargain compared to regular gas. A number of domestic vehicles can burn the stuff as an alternative to gasoline — those are cars and trucks sporting little "FFV" (flexible fuel vehicle) badges you might have seen on the road if you look for such things. Had you gone to the agriculture building at the Minnesota State Fair this year, as I did, you could have seen a big honkin' E85-fuelable Chevy Avalanche pickup promising to reduce our foreign oil dependence with the help of shy Norwegian bachelor farmers.

There is a catch, of course. Two catches, really. For one thing, the price of E85 is lower than that of gasoline thanks largely to large Federal subsidies. For another, it takes fossil fuels in the amount of roughly all of the energy in the ethanol to grow, distill, and transport to market a gallon of corn-based ethanol.

Whether the energy balance is somewhat negative (PDF) or somewhat positive (PDF) is a potentially a matter for debate. It does appear, though, that much of the difference between studies showing positive and negative balances derives from the optimistic ones omitting a substantial component of energy input associated with producing the capital equipment required for corn farming and ethanol distillation — tractors, ethanol distilleries, etc. (see figure 12 of this paper). Insofar as the pessimists would be right to assert that from much to all of the plant and equipment for the ethanol production cycle would be avoidable (in some sense) if ethanol production were terminated, whereas the optimists point out that only the pessimists measure that source of energy use, the pessimists seem to have the better of the argument for now.

So E85 is basically a scam, but you'd have to use your imagination to figure that out from Danny Hakim's alternative fuels article from Saturday's Times. He quotes someone from jolly old Madison saying that "I feel better that it's coming from the United States," and a Twin Cities suburbanite claiming that E85 is "cleaner for the environment" and is "made here in the Midwest, not in the Middle East."

Hakim notes as "downsides" that E85 is hard to find, yields slightly worse MPG than gasoline, and is subsidized (the FFVs themselves being a CAFE-skirting boondoggle). Oh, and there's this little thing that fueling the entire U.S. car and truck fleet with E85 would require planting essentially the entire unpopulated land area of the country with corn; that'll be great for the environment. The energy balance issue doesn't even rate a mention! Indeed, it's termed an "upside" that ethanol is a "domestic resource." Which is technically mostly true, though mainly in the sense that the coal, most of the natural gas, and some of the oil used in its production are domestic resources — not to mention the tax dollars.

Ultimately, the picture of the upsides and downsides of E85 is quite distorted. While the stakes — getting rid of this egregious agribusiness welfare — is perhaps not as high in other areas, I think this could serve to reinforce Lance Mannion's point (via Frogs and Ravens) that journalism education needs not whatever instruction that reinforces the "two sides to every story" and "opinions on shape of world differ" templates, but rather the essential training would be the best liberal education money can buy.
I'm surprised you take such a negative view of an alternative fuel.

I think that we should get rid of the ethanol subsidies. As far as planting all the US with corn, if one could produce ethanol without using so much fossil fuel, this would be good for the environment, since all the CO2 released into the air upon burning ethanol would be CO2 that had been taken from the air when the corn was growing. This is opposed to releasing all the carbon that was trapped long ago in fossil fuels and raising our atmospheric CO2 levels return to where they were during the age of the dinosaurs.
We economists can be funny in not valuing "alternativeness" for its own sake.

The Times article does mention that future technologies have the potential of making ethanol much more efficiently by making use of existing agricultural wastes. A significant benefit of that is that you wouldn't have to charge the energy used in producing the agricultural equipment against the ethanol. My guess is that it would be more efficient to just directly fund R&D along those lines, rather than subsidizing the existing energy-inefficient processes.

Good point on the CO2.
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