As a more upbeat follow-up to our last discussion of ethanol in the Golden State, there is this news item about how ethanol and biodiesel availability is expanding in California.
OAKLAND, CA–(Marketwire – August 31, 2010) – At a grand opening event today at the Bay Area’s newest renewable fuel station, California Energy Commissioner Anthony Eggert, Director of California Governor Schwarzenegger’s Office of Economic Development (GoED) Joel Ayala, and officials from Propel Fuels, CALSTART, and East Bay Clean Cities, formally launched Propel’s Bay Area operations, which will include more than 20 stations across the Bay, with up to 10 open by the year’s end. The event also announced a $10.9 million grant from the U.S. Department of Energy (DOE) and California Energy Commission (CEC) to build and operate 75 retail renewable fuel stations throughout California over the next two years.
Is there a full moon out or what? In my normal course of scanning news, web sites and blogs for information I discovered a veritable trifecta of absurdity regarding petroleum the other day.
My favorite article had to be about a new study arguing that eliminating federal tax deductions for intangible drilling costs and for US oil and gas production expenses would hurt oil production growth and devastate future US natural gas development.
The Wood Mackenzie study was commissioned by none other than the American Petroleum Institute. (nod, nod, wink, wink). Aren’t these the same companies (foreign & domestic) who were raking it in hand over fist from 2003 to 2008 and making record profits?
We have seen repeatedly that domestic oil price shocks are a result of refining and distribution problems more than even supply. Mix that in with inadequate competition in the oil industry and an ample dose of bad energy policy and you get a real mess. Maybe this is why the petroleum giants have tried repeatedly to discredit the performance and viability of ethanol.
This might go a long way toward explaining why they have so energetically fought against “tax incentives for blending ethanol” that actually go the ethanol blender…once again oil. Forgoing short term gain for long term profit is not a new concept. It also would explain their reaction to the current effort to raise the amount of ethanol in a gallon of gasoline.
Increased ethanol demand cuts into petroleum’s profits and their ability to manipulate the market. The economic impact of being able to control a product we are addicted to from cradle to grave is heady and lucrative stuff. (more…)
We are officially in the dog days of summer and as such many people are vacationing and that often means lots of driving and time with family.
With all the exposure to gas stations you may have noticed the word ethanol on pumps. It is pretty much everywhere these days as a 10% blend in gasoline and it is increasingly showing up in E85 formulations for flexible fuel vehicles or FFVs.
In fact, GM recently announced their continued commitment to E85 ethanol as “our best near-term solution. In fact, last month, we announced that we’re increasing annual production of Flex Fuel Vehicles (FFV) to more than 850,000 – that’s a 55 percent increase from the 2006 volumes,” said Candance Wheeler, a Gm Technical Fellow.
GM’s 2010 lineup represents the most FFV models on the market, providing drivers with multiple options to fuel their vehicles – E85 ethanol, petroleum, or a combination of the two. And with many new stations opening up, especially in the south and south central regions, it’s becoming easier find a place to fill up.
The latest development is something called a “Blender Pump,” but I like to call it a consumer pump because it allows you to choose what gas or ethanol mixture you want; unleaded gasoline, or 10%, 20%, 30% or 85% ethanol. If you have an FFV you can pick whichever one is the best bargain or whichever blend works best in your car.
Despite all for proven benefits of ethanol some detractors continue to spread misinformation regarding ethanol fuel. As the attached charts show, ethanol is a great fuel and an even better idea if you believe we should rely more on farmers and less on imported oil from hostile nations.
In the last, but certainly not the least, of our posts from the recent 2010 Corn Utilization and Technology Conference (CUTC) in Atlanta, we hear from Steffen Mueller, principal research economist at the University of Illinois-Chicago Energy Resources Center.
Mueller did two presentations at the CUTC, both related to the increasing efficiency of ethanol production that continues to improve its carbon footprint under life cycle analysis. For one, Mueller says, the more useful co-products that can result from ethanol production, the better its carbon footprint. “With corn ethanol you also produce an animal feed product simultaneously, to which you have to assign a co-product credit, meaning you subtract the emissions to produce that feed product from the life cycle of corn ethanol,” Steffen explains in an interview. “Now, we’re also looking at other co-products. For example, a lactate which is a solvent that can substitute for petroleum-based solvents in the marketplace.”
Mueller also presented his findings from a recent study showing how ethanol plants are improving in efficiency. “We did a large survey of corn ethanol plants and assessed the energy consumption and showed that the thermal and electric energy that plants require to turn bushels of corn into corn ethanol has decreased by 30 percent over the last eight years,” he said. (read about that survey here)
Mueller says there is a lot of updated industry data coming together that shows that corn ethanol is becoming more efficient, which should help when it comes to regulations for low carbon emissions on both the national level and in states like California.
Listen to an interview Chuck Zimmerman did with Steffen Mueller at CUTC here:
Download the interview here: Steffen Mueller Interview
The American Coalition for Ethanol (ACE) honored corn growers for their efforts in promoting ethanol at the 23rd Annual Ethanol Conference and Trade Show in Kansas City this week.
On Wednesday night, staff members of the South Dakota Corn Growers Association and Corn Utilization Council received the President’s Award from ACE for “principled dedication and support” of the industry. SD corn executive director Lisa Richardson and legislative director Teddi Mueller received that award. Also, the National Corn Growers Association (NCGA) and 11 corn grower states were recognized with the “Paul Dana Marketing Vision Award” for their support in making the BYOethanol campaign possible.
NCGA president Darrin Ihnen of South Dakota addressed the ACE conference yesterday and talked about some of their efforts to promote ethanol, as well as their partnership with the organization to speak with a unified voice in Washington on issues important to the industry. Darrin sported fluorescent pink fingers at the conference, not as a new fashion statement, but proof that he is a working farmer as they came from vaccinating hogs the day before on his South Dakota farm.
Darrin talked about those big issues facing the ethanol industry right now – the expiration of the blenders tax credit at the end of this year and the delays in approval of E15 – as well as the lack of an energy bill in the Senate that includes provisions for renewable fuels. “We’re disappointed that they’re not going to do anything, but at the same time, the bill that Reid had introduced didn’t have anything in it for ethanol, so it gives us a little more time to get some ethanol provisions in that bill,” Darrin told me. “The downside is that they already don’t get a lot done so by pushing it back to September, that’s even less time before the elections.”
In our recent series discussing ethanol a lot of the information has been more philosophical in nature and has focused on some of the critics and their motivations. The idea was to get you thinking in a skeptical way rather than beat you up with statistics. That ends with this installment which will discuss petroleum. (Skip to the end for the stats).
Black Gold, Texas Tea, or carbon crack…at the end of the day there is a reason they call it crude. Even in its refined form it remains crude. This stew of dead, decayed plants and animals we call oil is nothing but another anachronistic fossil fuel that is little removed from cavemen rubbing sticks to keep us warm.
We may have become highly technical and efficient in finding oil and getting it out of the ground but the final product remains, well…crude.
Over the years more than 200 ingredients have been put in gasoline to try to make it burn better, make your engine knock less, and sometimes just because it was a convenient way to make unpleasant chemical waste products from the petroleum industry disappear out your exhaust pipe.
And all of us gonzo gas mavens would ignore the obvious imperfections and hideous social costs because it was abundant, cheap and made our powered toys sing. Cars, boats, motorcycles, weed-whackers, generators, power washers, etc…..Yikes, the list does go on.
Today, I would gladly trade in my heated seats, directional headlights, and GPS for a modern fuel (hopefully domestic) and new engine technology that moves us away from the oil-fed internal combustion dinosaurs we depend on today.
If we can have cell phone technology that changes daily, digital television technology sharper than the human eye can even see, and tractors that steer themselves we surly should be able to market a functional, fuel efficient and more environmentally friendly car that runs on a cleaner, renewable fuel source. (more…)
California is attacking corn ethanol again. The newest affront is complements of the California Air Resources Board (CARB) who has created a new working group to study soil sustainability provisions of biofuels. The current crops under review include corn ethanol, sugarcane ethanol, wood based fuels, palm oil, and soy biodiesel. The ultimate goal is that biofuels’ greenhouse gas emission (GHG) reductions will be measured by both indirect land use and also soil sustainability to be given a final GHG reduction number.
So what factors are considered to impact soil sustainability?
Carbon content
erosion
crop rotation
nutrition/chemical use
productivity
crop expansion
I believe that several recent events have led to these new proposed biofuels provisions, the biggest one being the ongoing attack of environmental organizations, such as Friends of the Earth, who are opposed to all things corn ethanol and commodity farming. What I find interesting is that many environmental groups seem to oppose everything – fossil fuel use, alternative energy and production farming. It’s almost like they oppose all things energy.
Similar to the same path CARB has traveled regarding indirect land use, a theory light on scientific support, this new path is also one with little to no scientific support in terms of how to “categorize” biofuels based on soil sustainability. You simply cannot create effective policy this way.
The other issue I take with these types of provisions within California policy making, is that they don’t include any provisions for gasoline. What are the indirect land use effects of oil production? No one asked until University of Nebraska finally studied them and found that they are even greater than originally estimated.
What are the ’soil sustainability’ or should we say, ‘environmental impacts’ of oil production? Drilling impacts soil. Spills impact soil.
Until more people become educated about the benefits of corn ethanol, we continue to have a fight on our hands, one that the agricultural industry is taking very seriously. I encourage people to reach out to organizations like CARB and enlighten them regarding the errors of their ways through the sharing of facts.
No matter how hard the anti-ethanol factions continue to fight, we still have one truth on our side: corn ethanol is a more environmentally friendly fuel at its worst, than gasoline is at its best.
A recent study attempted to make the case that if the U.S. government allowed the ethanol tax credit to expire it would have very few adverse consequences for the U.S. industry. The fact the study was funded by the Brazilian sugarcane ethanol industry was dutifully avoided.
Anti-ethanol folks, who have been receiving a lot of attention on this blog of late, made sure the study got plenty of media splash because it helped them further their own causes. Interesting they didn’t showcase the source of the funding for the study or point out how badly Brazil’s sugarcane ethanol industry lusts after access to the world’s largest ethanol market…the USA.
And in today’s budget conscious environment in Washington, DC their efforts are getting some traction. The direct cost of the ethanol incentives is being reviewed independently without any comparative assessment to savings in farm bill costs, how much we spend militarily on protecting our petroleum shipping lanes, or the economic fallout from depending on foreign oil. Federal tax revenue generated by the production and use of U.S. ethanol totaled more than $8 billion in 2009, $3 billion more than the value of the tax credit.
It is amazing how quickly some of our elected officials have forgotten the core rationale for putting the US ethanol tax credit in place. President Ronald Reagan, who was not exactly a political Dove, regularly noted it is in America’s best interest to reduce the world’s dependency on oil from unstable regions of the world.
That’s why Reagan and virtually every president since has asked domestic alternative energy producers like ethanol to step up. He also noted the expense related to America’s foreign oil addiction and how helpful bringing these energy jobs and the billions of dollars ($1 billion day) we send overseas could be for the U.S. economy.
Despite this clarion call the aforementioned detractors, which mysteriously enough include some environmental groups, like to preach the benefits of sugarcane ethanol; sometimes called “slash-and burn ethanol.”(See attached photo). It’s even more amazing some U.S. regulatory agencies actually tout Brazilian ethanol as an “advanced biofuel over the American made corn product. In case you were wondering the photo shows a burning cane field in Brazil. The Sao Paulo area alone burns 8,000 sq miles of field producing incredible amounts of volatile compounds and particulates.
To make harvesting easier, which reduces manual labor costs, sugarcane fields are burned prior to harvest to remove the plants’ leaves. Considering the near slave labor conditions in some cane fields I guess this burning might seem a gift for the machete wielding masses, despite the obvious environmental costs of the massive burning.
If critics are truly concerned about our fuel needs and specific environmental and economic consequences consider the following:
Data from the Brazilian sugar organizations clearly shows they are planning, by 2020, to export 63% more sugar and export 336% more ethanol – all at the expense of increasing the land area required for sugarcane by 78%. Corn based ethanol is being provided with increased corn yields on the same acreage and using modern production processes throughout the production chain.
Sugarcane ethanol provides primarily ethanol, with some electircal cogeneration. Corn based ethanol provides ethanol, high protein feed for livestock, corn oil, and even captured CO2 from the fermentation process to carbonate soft drinks.
Sugarcane ethanol provides jobs that don’t meet subsistence level incomes, while jobs in the ethanol production chain are highly skilled jobs that provide long term employment and taxable income for local schools etc…
And the next time you want to get on a soapbox promoting sugarcane ethanol consider the following items below which are being ignored to make Brazilian product look better than it is:
Ignoring direct and indirect emissions from crop residues;
Use of inappropriately low fertilizer rates;
Failure to account for energy inputs for dehydration of hydrous ethanol;
Failure to accurately assess transport of ethanol from Brazil to U.S.
Failure to assess actual cane harvesting practices and processing in Brazil
At the end of the day if the U.S. ends up importing more ethanol, then we will once again lose a domestic growth industry, export American jobs, and become dependent on foreign energy producers.
I just finished reading comments from The World Bank that say “…the effect of biofuels on food prices has not been as large as originally thought, but that the use of commodities by financial investors (the so-called “financialization of commodities”) may have been partly responsible for the 2007/08 spike.”
The whole time I was reading it I kept hearing the Ghostly voice of Gilda Radner, of Saturday Night Live fame saying “Nevermind.”
Her character Emily Litella was an elderly woman with a hearing problem who made regular appearances on SNL’s Weekend Updateop-ed segment in the late 1970s. Attired in a frumpy dress and sweater, Litella was introduced with professional dignity by the news anchors, who could sometimes be seen cringing slightly in anticipation of the verbal faux pas they knew would follow.
After ranting in an outraged manner, the news anchor would point out she didn’t get the point to which Gilda would reply “Nevermind.”
The World Bank’s leaked” report in 2008 erroneously blamed biofuels for 75 percent of the commodity price spike. The authors of their most recent report conclude that it is unlikely biofuels played a significant role because they do not represent a large percentage of worldwide grain and oilseed use.
It really might have been nice to know this before the World cost the nation’s family farmers dearly in terms of public trust. More importantly, they left the public thinking we should reserve our corn for human food consumption alone. Given this market is mature and our corn yields are soaring, we must look to other markets to keep farmers profitable and viable. And the markets with the most growth potential are things like ethanol, biodegradable products and other industrial uses.
“In reversing course, this World Bank report reaffirms the marginal role biofuels play in world commodity and food prices,” said RFA President Bob Dinneen. “The RFA has long noted that ethanol production has continued to increase while corn prices have now returned to normal levels. Volatile oil prices, speculation, and adverse weather conditions all played far more significant roles in driving commodity prices to record and near record prices. This report should silence critics in the food processing industry, the livestock industry, on Capitol Hill, and anywhere else that sought to portray ethanol as the boogeyman. With this phony food and fuel discussion put behind us, perhaps a real conversation about America’s energy future can ensue.”
Well put Bob but I think the cow left the barn in regard to the damage the World Bank did with their previous faux pas. I wish Emily/Gilda was still around to tell American consumers “Nevermind.”
Dear New York Times…Your editorial today regarding corn-based ethanol is superficial, either uninformed or malicious, and a disservice to the citizens of this nation looking for real energy solutions we can implement today.
Before addressing some of the onerous points in your piece, please take a look at the attached photo. This is not from the BP spill in the Gulf but rather the latest incident in Michigan which has dumped a million gallons of oil into a river and is now 80 miles from polluting Lake Michigan. Oil is and always has been a loaded gun from an environmental perspective. From leaking tanks at service stations to oil tankers grounded on coral reefs in storms. No more explanation needed on this one.
However, perhaps the biggest point you fail to address is wind, coal, and geothermal don’t make your car go. Natural gas can be used as an automotive fuel but it too is not renewable and has other issues I won’t go into here today. Solar….I’ll race you with my bicycle.
Will ethanol be made from other sources some day? Undoubtedly. Other biomass sources show real potential and will come with the proper research and development, but corn-based technology and infrastructure is the very launching platform for this effort. Yet opponents would have us build our domestic energy house without a foundation.
Ethanol…dubious environmental benefit? Line up the hundreds of studies regarding ethanol, look at the funding sources and consider what is left. What you will find is a long trail of reputable scientists and institutions public, private and governmental that clearly shows the environmental benefits of ethanol.
When compared to petroleum especially, ethanol is a rock star in regard to cleaning the air, maintaining water quality, and soil management. On the oil side think tar sands.
Your reference to the land use issue is also comical. Incredible productivity on our existing corn acres is easily supplying the growing ethanol industry while also meeting the needs of other markets. And yield growth is accelerating.
And finally, I think we must aggressively pursue all forms of renewable, domestic energy given the finite nature of petroleum and do so in good conscience because of the legacy we stand to leave future generations. To suggest we put our entire energy investment in “maybe someday” sources while ignoring a viable and tested source like ethanol is shortsighted at best.
As a more upbeat follow-up to our last discussion of ethanol in the Golden State, there is this news item about how ethanol and biodiesel availability is expanding in California.
In the last, but certainly not the least, of our posts from the recent 
NCGA president Darrin Ihnen of South Dakota addressed the ACE conference yesterday and talked about some of their efforts to promote ethanol, as well as their partnership with the organization to speak with a unified voice in Washington on issues important to the industry. Darrin sported fluorescent pink fingers at the conference, not as a new fashion statement, but proof that he is a working farmer as they came from vaccinating hogs the day before on his South Dakota farm. 
