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By Robert Rapier on Nov 7, 2008 with no responses

Cellulosic Ethanol Politics

Last year when the Renewable Fuel Standard was established, the ethanol mandate was increased to 36 billion gallons per year. A big portion of that was to be cellulosic ethanol, but there had to be a demonstrated greenhouse gas reduction in order for cellulosic ethanol to qualify for the subsidy. The EPA was tasked with putting together rules to quantify the greenhouse gas reduction.

If you are like me, you see an immediate problem. The EPA is a governmental agency, and the executive branch of the government is pushing the mandate. There are a lot of people with a vested interest in seeing the EPA adopt generous accounting rules. In fact, in February of 2008 I wrote:

Who is going to evalaute the greenhouse gas reduction? You can’t even get scientists to agree on the parameters [boundaries of the analyses], how is anyone going to stack hands on this? It will become a hot political issue. When you can’t even get agreement on the energy balance, how on earth will you get agreement on the GHG reduction?

As I have argued before, current wet cellulosic ethanol technology requires copious amounts of fossil fuel. Thus, it is almost certain that there are presently no greenhouse gas savings that can legitimately be claimed on the basis of cellulosic ethanol production. Therefore, those who are wedded to the (wet) cellulosic model stand to see their dreams of generous subsdies dashed. So, it may not surprise you to hear that the jockeying has started. Gristmill has the story:

Fuel me once, shame on you

On Oct. 21, several academics and representatives from the biofuel industry sent a letter [PDF] to EPA Administrator Stephen Johnson asking the agency to exclude accounting for these emissions from their rulemaking, calling the requirement “premature.”

The authors said that it is “of particular concern” to them that “the EPA appears to be relying heavily” on the February 2008 report that found that both corn- and switch-grass ethanol actually have higher net greenhouse gas emissions that conventional fuel sources. “It would be very unfortunate if a rush to judgment by the EPA would cast unwarranted doubt on the value of these low-carbon, 2nd generation biofuels,” they wrote.

Who were the people who sent the letter? A bunch of professors like Michigan State’s Bruce Dale – whose research (and government funding) are based on cellulosic ethanol – and a couple of companies with financial interests in cellulosic ethanol. In other words, people with a vested financial interest. Here Professor Dale is in 2007, testifying before the Senate Finance Committe that 1). We will be able to make cellulosic ethanol for $1.20 within 5 years; 2). We need more government funding; 3). I said the same thing in 2001; and 4). Oh, by the way I have been working on this for 30 years.

But another letter was sent from several environmental groups, and they seemed to have a different take on the matter:

“There is nothing ‘premature’ about Congress’s insistence that federally mandated, taxpayer-subsidized biofuels are environmentally beneficial,” they wrote. “The RFS has propped up the biofuel industry for three decades, on the untested assumption that biofuels are good for consumers and the environment. During that time, its proponents — including the authors of the October 21 letter — have failed to demonstrate that biofuels provide any such benefits.”

You know where I stand on this. If there are no greenhouse gas savings, subsidizing cellulosic ethanol is just subsidizing the fossil fuels that it took to make the cellulosic ethanol. As I have argued before, I think (true) cellulosic ethanol is dead in the long run. The only question for me is how much money we are willing to throw away before conceding that fact.