Latest posts by James H. Rust (see all)
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Considerable unrest is taking place in the world, in particular North Africa and the Middles East, and much of this is due to higher food prices making life hopeless for millions of people. The United States has programs for producing transportation fuels of ethanol from corn and biodiesel from soybeans.
Forty percent of our corn crop and over 12 percent of our soybean crop goes to making biofuels. This amounts to 12 percent of the world’s corn production(5 billion bushels) and over 4 percent of the world’s soybean production(600 million bushels) used exclusively for making biofuels from United States crops. This amount of food would feed over 100 million and is an unnecessary use of food products for transportation fuels.
The higher corn and soy beans prices have contributed to substantial rises in food prices in the United States and elsewhere in the world.
Over $10 billion annually is used to subsidize these unneeded programs on a federal level and more on state and local levels. For ethanol, it takes more energy to produce the ethanol than it contains. Professor David Pimentel of Cornell University has published it takes 1.29 Btu of energy to create 1 Btu of ethanol. In addition, corn requires huge quantities of water to grow and the United States is depleting valuable underground water resources for its production.
One can look at the cost of raw materials for biofuels–corn is now selling for more than $7 a bushel and soy beans is selling for $13 per bushel. You can produce 2.4 gallons of ethanol from a bushel of corn and 1.5 gallons of diesel fuel from a bushel of soybeans. This means raw material costs for ethanol is $2.90 per gallon. However, when you allow for ethanol only having two-thirds the energy content of gasoline; the real cost of ethanol is $4.35 a gallon. The cost of biodiesel from soy beans is $8.67 per gallon. There are waste products left over from making ethanol and biodiesel that can be sold as animal feed to lower biofuel costs. However, these by-products have to be marketed and there are other costs associated with producing biofuels which for ethanol is expensive because of distillation of the mash. Biofuels are always higher priced than gasoline or diesel fuels. Therefore, this is not a means to relieve problems from higher gasoline prices.
For more than thirty years advocates of ethanol have claimed it can be produced from cellulosic sources such as wood or grass. To date there has been no successful scale-up from small laboratory production of cellusosic ethanol to plants producing millions of gallons per year. The recent closing of Range Fuels cellulosic ethanol plant in Soperton, Georgia January, 2011 illustrates a waste of federal, state, local, and private investors money.
Chrysler announced its 2011 minivan Grand Caravan has EPA mileage ratings of 17 mpg city/25 mpg highway for all models. The Grand Caravan is also available as dual-fueled which means the vehicle can run on gasoline or E-85, the 85 percent ethanol/15 percent gasoline mixture, with a rating of 12 mpg city/18 mpg highway. Viola! On E-85 we have a vehicle that gets 80 mpg city/120 mpg highway on gasoline. This solves the problem of increasing mileage standards for new vehicles as demanded by President Obama’s energy policy. You only need a quarter of your vehicle production to run on E-85 to have your entire vehicle fleet satisfy government fuel efficiency requirements. No one pays attention to whether anyone buys E-85. So much for President Obama’s plan to decrease gasoline use by greater vehicle efficiencies.
The biofuels industry can not exist without government subsidies which adds indirectly to fuel costs and higher government deficits. The federal government now wants to use tax dollars to pay station owners to provide E-85 pumps. Only a fool or federal government employee would use E-85 because of decreased mileage and higher costs.
The use of ethanol as a transportation fuel is scheduled to increase due to the Energy Independence and Security Act of 2007 which mandates the use of 36 billion gallons of renewable fuels by 2022. This act needs to be repealed immediately to prevent further diverting corn crops for ethanol production. In 2011, over 12 billion gallons of ethanol from corn will be produced. This is more ethanol than is required to convert our entire gasoline supply into E-10. EPA is now suggesting marketing E-15 which could ruin older cars, lawn mowers, chain saws, tillers, wood chippers, and other devices that run on two-cycle engines. This could be a solution to our unemployment problems due to hundreds of millions of engines destroyed that would need replacement. Naturally, we would need to stop engine replacements coming from overseas.
The White House and Democrats in Congress are proposing a “Green Investment Bank” that will provide loans for biofuel programs and other renewable energy sources such as solar and wind energy. This puts the government into the position where it picks winners and losers on future energy sources. Past history points it has been mostly losers. This form of government intervention stifles creativity, causes great loss of taxpayer’s money, and may prevent development of future, workable energy sources beyond our imagination. Our government should get out of the energy business and let the private sector develop our energy resources without encumbrances of nonsense regulations.
Last January, Peter Brabeck, chairman of the $100 billion Swiss food giant Nestle, addressed the World Economic Forum in Davos, Switzerland and stated using food for biofuels was “absolute madness”. The public should stop this runaway train of wasted money for a useless fuel.
The United States has vast resources in coal, oil, and natural gas; far greater than any other country in the world. We should implement programs to develop these energy resources. Restore drilling for oil and natural gas off-shore. The area in Alaska called the Arctic National Wildlife Refuge is 31,000 square mile and only three square miles in its upper Northwest corner would be needed for oil drilling. This location is about 60 miles from the Prudhoe Bay pipeline that transports oil to Valdez, Alaska. Additional sources of liquid transportation fuels can be produced from natural gas as being shown by Shell Oil Company in Qatar and Indonesia.
Energy could be our largest industry and we could export energy products and more food to reduce balance of payment deficits. Present government policies are to ignore our abundant energy resources and embark on programs to reduce use of fossil fuels and replace them with energy sources that are more expensive, unreliable, and impractical such as solar, wind, and biomass. Small groups will profit from these policies to the detriment of the majority. These policies need to be reversed if the United States ever hopes to regain its past position of the world’s greatest economic power.