Garbanzo Toons

Ethanol is Not the Answer

The government in a blatant move to pander to the agricultural interests in this country are selling us out again. Huge subsidies are up for grabs in order to promote ethanol as an alternative to gasoline. The problem though, is that ethanol is not only a poor substitute, it will actually cause more damage to the environment and to the economy than petroleum. According to Mark Perry,

It sounds as though the United States is making progress to reduce our nation's dependence on foreign oil. It is stepping up production of ethanol. Legislation that would require a sevenfold increase in the use of biofuels is coming up for final approval in Congress. Carmakers are rolling out increasing numbers of new flex-fuel vehicles that can run on E85, a fuel that is 85 percent ethanol and 15 percent gasoline.

None of this should give us too much comfort, however. Ethanol production this year will replace less than 5 percent of the gasoline sold. Yet, since 20 percent of today's corn crop is used to produce ethanol, it is pushing up food prices -- everything from meat and dairy products to beer, soda pop and even charcoal briquettes, one of many products that contain corn.

So dominant has this grain become that of the estimated 45,000 items in supermarkets, more than one quarter contain corn. No surprise that the increase in corn-based ethanol during the past 12 months has raised food prices by $47 per person, according to a study by Iowa State University.

Fuelish rush causes harm

In the rush to replace gasoline with biofuels, we may be doing ourselves real economic harm. The government-supported push for ethanol will add to Americans' burden of high fuel and food costs and especially hurt people on fixed incomes.

Clearly, there is a limit to how much of the U.S. corn crop can be gobbled up for ethanol without pushing food prices higher and higher. This possibility does not seem to have bothered senators who voted for an energy bill requiring an increase in ethanol production to 36 billion gallons a year by 2022, up from 5 billion gallons this year.

The bill would also provide loan guarantees, biofuels research and development grants, and grants for ethanol plant construction. As if that's not enough, Sen. Richard Lugar, R-Ind., and Sen. Tom Harkin, D-Iowa, are co-sponsoring a bill that would raise the ethanol mandate to 60 billion gallons by 2030.

Ethanol cannot be justified scientifically or economically. The only reason the industry has survived is that the government gives corn farmers and ethanol producers generous subsidies. As the Wall Street Journal pointed out, ethanol is produced by mixing corn with our tax dollars.

If extended through 2022, as the Senate energy bill provides, it will cost taxpayers an estimated $131 billion, according to the Tax Foundation. Subsidies under the Lugar-Harkin measure would cost as much as $205 billion during the next 15 years.

The scientific problem with corn ethanol is that it contains one-third less energy than gasoline. So a motorist has to purchase one-third more fuel to go the same distance. If you total all of the fossil fuel that goes into making ethanol -- nitrogen-based fertilizer and herbicides, fuel to run farm machinery, natural gas for the distilling process at ethanol plants -- it takes more energy to produce ethanol than the fuel provides.

Formula for a drought

Furthermore, the rush to produce ethanol is adversely affecting the environment. In many parts of the corn belt, water tables are dropping, in some places 10 feet or more in the past decade, because it takes a great deal of water to grow corn and produce ethanol. For that matter, if the government keeps requiring unreasonably high levels of ethanol production, a prolonged drought that devastates the corn crop could cause fuel shortages in the future.

In addition, heavy corn production exacerbates soil erosion, pollutes groundwater supplies from chemical runoff and increases the level of greenhouse gas emissions from the conversion of grassland to corn production.

If Congress wants to moderate fuel prices and help consumers, it ought to open potentially oil-rich areas off the Atlantic and Pacific coasts to oil and natural gas production. And members of Congress should realize that producing oil in very deep water requires huge investments, as does developing techniques to tap the enormous deposits of oil locked in shale and tar sands.

But there is a real danger that Congress will remain oblivious to the economic and scientific realities of ethanol and take us down the wrong path by mandating a huge increase in ethanol production. Washington might have a love affair with ethanol for political reasons, but increasing ethanol production will lead to higher taxes, higher prices for both food and fuel, and damage to the environment, making us all worse off.

Congress needs to say no to the ethanol hustlers and end its political addiction to corn.

Yep, I swiped the whole thing. That's because the Detroit News lets old articles fade from the Net and this is too important to not be put in the face of every ethanol supporter. Mr. Perry has more to say about ethanol on his blog in this post.

I would like to hear the counter arguments - if any.

Labels: ethanol, Mark Perry

posted by Harry @ 10:21 AM