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Biofuel Industry

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Biofuel Industry: Ethanol Subsidies are Impediments for Advancements in Efficient and Sustainable Energy Sources

There has been recent interest in the possibility of harnessing energy production in biological processes as a sustainable energy alternative. According to Wikipedia, by definition, biofuel is “any fuel with an 80% minimum content by volume of materials derived from living organisms harvested within ten years preceding its manufacture.” Biofuel is a term which refers to a renewable energy source derived from biological process. Current popular fuel and energy types such as fossil fuel can never be sustainable. This is due to the fact that we are using fossil fuels faster than the earth can replenish the source. Fossil fuels that have taken thousands of years for the earth to create are consumed in a day. Biofuels are a sustainable energy alternative because they are produced and harvested frequently so we can ensure that the source of energy is being replenished.

David Pimentel, a professor of insect ecology and agricultural sciences at Cornell University in Ithaca, New York, published an study titled Ethanol fuels: Energy security, economics, and the environment in 2001 which appeared in Encyclopedia of Physical Science and Technology. Pimentel concluded that 1.7 times more energy is required to grow and process corn and then distill the ethanol than is obtained from burning it.

According to a study conducted by Berkeley only 5 percent to 26 percent of ethanol’s energy content is "renewable." The balance of ethanol's energy actually comes from the staggering amount of coal, natural gas and nuclear power necessary to produce corn and process it into ethanol. Pimentel says “the myth is that ethanol frees us from dependence on oil, yet we actually import oil to run ethanol plants and grow corn.” In addition to the inefficient energy production of ethanol, there are also many environmental costs associated with corn production. According to Pimentel, corn uses more herbicides and pesticides than any other U.S. crop and erodes soil 12 times faster than soil can naturally be reformed.

If what Pimentel says is true, then why do we continue to produce ethanol as an energy alternative when, according to him, energy is lost in ethanol production, not gained? His study did not even calculate the economic losses of environmental degradation that ensues during corn production and he still found that ethanol is economically unsound. One reason that ethanol remains a biofuel and energy source competitor is the heavy amount of state and federal subsidies ethanol receives. In 1986, a study by the Department of Agriculture study predicted that ethanol could not survive long-term without “massive government subsidies.” This prediction has recently come true. In 2001, Pimentel found that if the $1billion of federal and state subsidies in 2001 were dropped, ethanol would be a loser in fuel competition.

Ethanol advocates argue that subsidies are necessary to "level the playing field" for petroleum and ethanol competition. Petroleum subsidies are something less than $1 billion a year fact – six to eight times less than ethanol subsidies – and work out to about 0.3 cents per gallon (Jerry Taylor and Peter Van Doren). A study last fall (autumn) from the International Institute for Sustainable Development found that ethanol subsidies amount to $1.05-$1.38 per gallon, or 42 percent to 55 percent of ethanol's wholesale market price (Jerry Taylor and Peter Van Doren). This ensures that the uninformed consumer will perceive ethanol to be a cheaper alternative to fossil fuels.

It seems that the ethanol industry is no longer run by scientific and technological reason and ingenuity, but by the corrupt influence of business and government. Recently, one of our presidential candidates, Hillary Clinton had a change of heart when it came to her stand on ethanol spending… She is promoting a “$50 billion strategic energy fund, laden with more ethanol perks.” (Shailagh Murray, ethanol undergoes evolution) Previously, Hillary Clinton voted ‘no’ only to change her vote later to appeal to Iowa voters. Corn is one of Iowa’s primary economic contributors. A poll survey done by Des Moines based J. Ann Selzer found that 92 percent of Iowa voters rated ethanol as important to the state’s economic future. One headline ran “A Calculating Clinton Flips on Ethanol to Score a Run with Iowa Voters.” Her incentives and policies are definitely not reflecting the reality which they claim to be supporting. ‘Funding to secure America’s energy future’ – yeah right. She uses her votes and influences to get ahead in the election and gain voters support rather than maintain a platform which promotes the betterment of our energy future.

It seems that the case study of ethanol politics brings up many reasons for action and intervention. Billions of dollars are being spent to keep an ass-backwards industry afloat. This money could be better spent developing biofuel technologies that have positive energy gains. Good thing there are many other alternative biofuels to ethanol, and private investors willing to support them.

An article published March 7th, 2007 in the New York Times looked at new developments in the biofuel industry. The article quotes figures from Clean Edge and Nth Power study which shows a rise in over $1 billion dollars in clean energy venture capital investments last year. Many of these investments are funds for research or business development. The focus of the article is on developments in technologies which seek to harness energy produced by algae farms. Recent studies in algae have found that as much as 20,000 gallons of fuel could be produced each year by one acre of algae pond. Though the article reports that algae is an energy efficient source of biofuel, it fails to analyze the resources necessary to produce the biofuel. To me, the future of algae biofuel looks skeptical. We are already on the verge of a water crisis and the algae require large ponds, similar to rice paddies.

The potential for alternative fuel sources are almost limitless. There are developments in biofuel plant sources such as corn, soybeans, flaxseed, rapeseed (canola), sugar cane, Palm oil. Other types of organic matter can be converted to usable fuel as well; straw, timber, manure, rice husks, sewage, food leftovers and almost any form of biodegradable waste. Anything organic can be converted into fuel. The only difficulty, as assessed in the ethanol study, is that some conversions from organic matter are efficient, where other conversions are not. The future of biofuels should be determined by their efficiency and environmental implications rather than misguided government subsidies. As citizens of this country, we have a voice in the matter, we can write letters, we can rally, and we can vote. We should not stand for inefficient use of our taxes. If you think it is a lost cause in trying to stop our national energy policy, support an efficient biofuel company in your community.

[edit] 1 References

  • Original article written by Peter Thamer, March 17, 2007. Santa Clara University: Third year environmental Science Major
  • CBS News, 2005, "Study Says Ethanol Inefficient", ALBANY, N.Y. July 19, 2005
  • Murray, Shailagh, 2007, Ethanol Undergoes Evolution as Political Issue: "Former Opponents Clinton, McCain Tout Its Benefits, but Its Campaign Value May Be Dropping". Washington Tuesday, March 13, 2007.
  • Taylor, Jerry, and Van Doren, Peter, 2007, "Ethanol Makes Gasoline Costlier, Dirtier". CATO Institute website

[edit] 2 Critical Resources

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