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By Robert Rapier on Mar 8, 2007 with no responses

The Handy-Dandy Khosla Refuter

The web site Seeking Alpha has just published a new article on ethanol:

Ethanol: A Few Myths Debunked

To be honest, there are so many misconceptions and myths in the article that a better name for it would have been Ethanol: A Few Myths Repeated. I think all of these “myths” have been covered at one time or another in this blog, but he does quote Vinod Khosla at length. So, this might be a good time to re-debunk Khosla, given that he has repeated this claims many times since the first debunking.

So, once again, here are Vinod Khosla’s claims, repeated from the above article, dissected and debunked.

VK: Energy balance is not even the right question to answer. It is not the energy balance of ethanol that matters but the energy balance of ethanol relative to the energy balance of gasoline.

I agree 100%. But this is exactly the comparison that I and others have consistently made. The problem is that VK is comparing apples to bananas, as I will show.

VK: Dr. Wang at Argonne National Labs has built one of the most rigorous and transparent public models for energy balance calculations. His results indicate that corn ethanol has almost twice the energy balance compared to gasoline, yet this crucial fact is seldom mentioned in the press.

That’s because it is just flat-out wrong. If this was true, we wouldn’t even use gasoline, and ethanol wouldn’t need federal subsidies. After all, why on earth would we invest our BTUs into gasoline when we could get twice the energy return with ethanol? The reason is that VK is grossly misinformed, but he has no excuse because I have explained this to him over the phone. Twice.

VK: According to the majority of studies, corn ethanol has an energy balance between 1.3-1.8 while gasoline is substantially worse, at about 0.8 (since it takes energy to extract, transport, refine and handle gasoline).

Doesn’t it take energy to plant and harvest corn, ferment the ethanol, refine it, and transport it? Of course it does. Except with gasoline, the planting and fermenting have already been done by nature. The harvesting involves drilling a hole in the ground and extracting an energy rich, water-insoluble mixture that takes a fraction of the energy to refine that ethanol takes.

Here is the true story. If I have 1 BTU to invest, and I want a return on that BTU, where am I going to invest it to get the most value? Well, if I invest in ethanol – according to studies that the afore-mentioned Dr. Wang has co-authored – I am going to end up with about 1.06 BTUs of fuel and 0.25 BTUs worth of animal feed. So, for an investment of 1 BTU, I netted 0.06 BTUs of liquid fuel. Again that is backed up by the USDA’s own studies that Dr. Wang has co-authored.

If I invest that BTU into gasoline production, here is what I get. The worst conventional fields in the world have a 10/1 energy return on getting crude oil out of the ground. According to Cutler Cleveland (and consistent with my own personal experience), the world wide average energy return for crude oil extraction is 17/1. So, for my 1 BTU investment, I average 17 BTUs of crude in the crude tank. But I have to refine it. A heavy, sour refinery has an energy return of about 10/1 (producing gasoline, diesel, heating oil, jet fuel, etc. from the crude). So, my 17 BTUs of crude are going to take 1.7 BTUs – in the worst case – to refine. I have then invested 2.7 BTUs (1 to extract and 1.7 to refine) to process 17 BTUs of crude into liquid fuels.

Typically, there are losses of around 5% in refining crude. These losses often have BTU value that is recovered, but let’s say they don’t. Then, my gross is 17 * 0.95 = 16.15 BTUs of usable liquid fuels for my BTU investment of 2.7 BTUs. My energy return is 16.15/2.7, or 5.98. This compares to an energy return of 1.3 for ethanol (when we count animal feed as BTUs). So, gasoline has about 4.6 times the energy balance of ethanol, as opposed to VK’s claim of twice the energy balance for ethanol. He is off by an order of magnitude. Now it should start to become clear why ethanol will always need subsidies to compete.

Moving on:

VK: Electricity has an energy balance four times worse than corn ethanol. Do we stop using electricity?

No, because we can’t plug our toasters into a pile of coal. We can, however, run vehicles on the fossil fuel inputs that we used to make ethanol. That is the key difference. Electricity is a much more user-friendly form of energy than is coal. There is no advantage to recycling fossil fuels into ethanol (well, there’s coal, but I won’t go there).

VK: Dr. Wang goes on to say that energy balance is “not a meaningful number for any fuel in evaluating its benefits. “Why then does the press continue mentioning it?

It is ironic that in the same essay VK argues that the energy balance of ethanol is twice that of gasoline, he also argues that it is not a meaningful question. I have pointed out the absurdity of this position before, because this isn’t the first time he has taken it.

VK: Why do they fail to mention that electricity has a substantially worse energy balance than ethanol?

See above. Think about plugging your DVD player into a pile of coal and the picture will start to become clear.

VK: What is often inferred by the press is that it takes more petroleum to make ethanol than is displaced. This is emphatically NOT true, even in the most vintage of plants.

He is correct here, but fails to mention that the majority of the fossil fuel input into an ethanol plant, natural gas, works just fine as a vehicle fuel. Compressed natural gas (CNG) buses are very popular mass transit options, for instance.

VK: In fact if we have to pick an alternative to gasoline, then ethanol is the best choice today.

Ethanol, also known as recycled natural gas. My question is: Why go to the trouble of recycling the natural gas into ethanol, when CNG buses have a proven track record?

VK: Energy balance is the wrong question. Greenhouse gas emissions per mile driven is the right question.

Those questions go hand in hand. In fact, they are inversely proportional. The lower the energy balance, the higher the overall greenhouse gas emissions for the process. For an energy balance of 1.06, you have a 6% reduction in greenhouse gas emissions. Along with that, we get more pesticide and herbicide runoff into our waterways, increased soil erosion from expanded corn production, and we all get to pay more for our food.

We can do better. If we put half the effort into supporting conservation measures that we do into supporting corn ethanol, we could make a significant reduction in our fossil fuel usage. But, there isn’t any money to be made in that, so this option tends to be ignored. Sooner or later we won’t have a choice, but I would like to see us make the choice while we do still options.