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By Robert Rapier on Jul 22, 2006 with no responses

Kicking the Oil Habit Road Trip

A recent e-mail brought my attention to a coast-to-coast road trip that is being sponsored by Kick the Oil Habit. The purpose of the road trip is primarily to raise E85 awareness and to promote E85 as “clean burning, American made fuel.” You can read a blog of the road trip here:

Kick the Oil Habit Road Trip

While I am dedicated toward the goal of energy independence for the U.S., E85 boosters are ignoring facts in their zest to promote E85. There is a great deal of misinformation and flat out factually incorrect information out there. For example, I just finished listening to a conversation between Mark Pike, who is the guy driving the E85 car cross-country, Tom Daschle, and Vinod Khosla. The conversation is archived at the blog at:

Sen. Tom Daschle & Vinod Khosla talk Ethanol

There are quite a few examples of misleading and factually incorrect statements, as well as a distinct lack of critical analysis regarding a number of claims. Here are some excerpts:

Daschle: One only has to look at the Middle East to see how critical energy independence is to us.

I agree. How is E85 going to achieve this? The fossil fuel inputs into E85 are substantial. Those fossil fuels are coming from, among other places, the Middle East.

Daschle: With the environmental issues that we face today, Global Warming, etc., the answers point to E85.

Come again? Multiple studies confirm that the greenhouse gas reduction from burning E85 is very small. How then is E85 an answer?

Daschle: E85 is a viable fuel, and ultimately could be the fuel of America.

How so? Where are you going to get the ethanol?

Pike: He talked about visiting Nebraska, and how E3 Biofuels is making a closed loop system.

I have blogged on E3 Biofuels before. While their efforts are to be emulated and applauded, their plant has not yet been built, and it still has fossil fuel inputs. So, let’s wait a bit to pass judgment until they have real production numbers.

Pike: If the technology is good enough for Mr. Khosla, it’s good enough for me. I know that guy has done his research, so I trust him. I will leave all of the scientific data and research to him.

This is exactly the reason Khosla’s claims have to be vigorously challenged. People do trust him. For some reason people transfer his credibility and success in the computer industry to expertise in ethanol. I believe he is misleading people, and helping promote a diversion that is going to delay real, sustainable solutions. I see him as the guy on TV who says “I’m not a doctor, but I play one on TV”. Well, if you are not a doctor, I don’t care for your medical advice. And from what I can tell, Khosla is grossly misinformed on the potential for ethanol to relieve our energy crisis. It is not going to happen.

(Pike had mentioned getting ethanol in South Dakota at $2.39/gallon). Khosla: You talked about $2.39/gallon; most people would kill to get that kind of price.

Most people? Perhaps if they are mathematically challenged. Since your fuel efficiency will drop by 25-35%, $2.39 a gallon E85 is the same overall cost as ($2.39/0.75) = $3.19/gallon gasoline. Throw in the federal subsidy of $0.51/gallon, state subsidy of $0.20/gallon, and a corn subsidy equal to $0.18/gallon, and now you have the same overall cost as if you were paying $4.37/gallon for gasoline. Yeah, Vinod, people would kill for that.

Khosla: Not only do you get a cheaper fuel, but you get a completely renewable fuel.

Do you really believe what you are saying? Cheaper? Not on an energy equivalent basis. Even on a per gallon basis, the rack price of ethanol has been higher than gasoline for 25 years. You can see that here:

Just last month, for instance, the average price of ethanol was $3.58 and the average price of gasoline was $2.22. I just can’t assign any credibility to Khosla when he is making such misleading claims. And “completely renewable”? How so? The process is running on fossil fuels. Those are not renewable, unless we want to wait millions of years. Claiming that the process is “completely renewable” is another indication to me that Khosla’s enthusiasm has affected his objectivity.

Pike: Companies like Ford and GM are really pushing these flex-fuel vehicles.

Right. Because it allows them to dodge penalties from not meeting CAFÉ standards:

Flex Fuel’s Big Pay-off

Khosla: There are few E85 pumps in California. It’s criminal that we won’t let an American-made fuel be sold on the roads due to the interests of people who want to protect oil profits.

How disingenuous. Is anyone keeping Khosla from opening up E85 stations all over California? No, they aren’t. He could put his money where his mouth is, instead of claiming that oil companies are preventing E85 pumps from being installed. In fact, there is not nearly enough ethanol to justify the pumps, so why on earth would Khosla, or anyone else expect oil companies to put in the pumps? There isn’t even enough ethanol produced to make a nationwide E10 blend. However, E10 at least can be pumped through a normal gasoline pump, and can be burned in a normal vehicle. It would make far more sense to roll out E10 to more locations than this misguided effort to try to force E85 pumps in, when supply is insufficient to justify them.

After that, Khosla started talking about his clean-energy initiative in California. I am writing an essay to address that, but I do want to call attention to a debate challenge I have issued to Khosla following an essay he wrote for The Huffington Post:

The Big Oil Companies Have Been Ripping Californians Off — And Not Just at the Pump

Check my comment following his post. I think he is misleading people, and needs to be held accountable for his statements. I reiterate my offer to engage in a written debate any place he chooses. Statements he has made regarding ethanol will be held up to scrutiny.

E-mail Response

Finally, here is the response I sent to the person calling my attention to this road trip. This came after an initial exchange of e-mails involving a few of us from The Oil Drum:

I guess I should probably weigh in as well, since I may be the most hardcore ethanol skeptic among us. Let me tell you just a little bit about myself. I work for Big Oil, but don’t let that scare you off. I came to work for Big Oil to work on alternative energy. I passionately believe in sustainable alternative energy, and I preach conservation. My graduate work was in the area of cellulosic ethanol, and I have looked at that process from every conceivable angle.

I agree with you that E85 is the most practical fuel for consumers in the short term (provided the massive subsidies keep flowing), but it is in no way sustainable. I have documented the marginal EROI from grain ethanol. On top of that, you have unsustainable soil mining, and waterways are being polluted with pesticide and herbicide runoff.

The best locations are already planted in corn, so to expand you are going to have to plant ever more marginal areas, potentially destroying ecosystems in the process. This worsens the EROI as you move to marginal lands, meaning less energy return for your energy investment. I have done some calculations that show that ethanol produced in a state requiring irrigation and shipped to the coast is an energy-losing proposition. You mention the revitalization of the agricultural sector. What about the increased food costs for poor Americans as ethanol competes with our food supplies? Those are the kinds of tradeoffs you have to consider. You can find a lot of really good information on the costs of ethanol, from a pro-environmental site, here:

I encourage you to spend some time evaluating their claims. I think you will come to understand why I, as well as many of us at TOD, am skeptical.

Cellulosic ethanol is a promising area of research, and one in which I spent a good deal of time working on. However, it can’t be expected to be a silver bullet. The economics are still not quite there. The EROI may be better, but the capital costs are much higher. In my opinion, it is not responsible energy policy to build out a nationwide infrastructure of E85 pumps when the only hope of supplying them is from a cellulosic ethanol breakthrough. What if it doesn’t come? First we make the breakthrough, demonstrate cellulosic is economically viable, then you start blending it into regular gasoline. Over time, you start building out E85 infrastructure as the process scales up.

I agree with you that E3 Biofuels is trying to make ethanol in a responsible manner. I have plugged their efforts on many websites, and wrote an essay at The Oil Drum detailing their plans:

E3 Biofuels: Responsible Ethanol

However, a couple of important notes regarding the comments about E3. I have corresponded with them, and I have the energy model for their plant. They will have a significant fossil fuel input according to their model. They forecast that they will be able to get it down to a very low level, but the blog entry claiming less than 3% input of fossil fuels is not accurate. Also important to note that these are projections, and the process has actually not yet been demonstrated. You may recall the excitement over TDP a few years ago:


They projected their costs would be $15 a barrel. Their actual costs were $80 a barrel. So, it is easy to be a bit too optimistic with projections. I am excited about what E3 is attempting, but let’s be a bit cautious until they start up their plant and prove just how “closed-loop” they really are.


Robert Rapier