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By Robert Rapier on Aug 16, 2010 with 199 responses

A Better Ethanol Policy

In my recent post Thoughts on an Ethanol Pipeline, I described what I feel would be a more rational approach to ethanol policy than some of the policies that have been pursued over the years. This gist is that the Midwest currently produces about 95% of the ethanol in the U.S. (12.5 billion gallons), but they export 70% of that ethanol out of the Midwest. At the same time, they import gasoline that is the energy equivalent of 37 billion gallons per year of ethanol.

It would seem to be a more sensible energy policy to utilize ethanol production closer to the source of production — especially given that the motor fuel demand in the Midwest is far greater than the volume of ethanol produced there. Many readers agreed, and following that essay, they provided a number of excellent comments. I drew on those comments in my latest essay for Forbes: The Midwest Should Use Its Own Ethanol.

Here I want to continue to develop policy recommendations around this theme. Reader Paul Nash came up with a specific plan, which I share below (here is the link to the original comments).

The Rationale for a Policy Change

  • The industry wants a pipeline to support a greater market on the east coast.
  • This market will likely only grow by either raising the blend mandate, or exporting ethanol
  • From a national energy use point of view, it is much better to have the ethanol being used near to where it is produced (Midwest).
  • Presently, this is only happening to the extent required by the blend mandate – there is relatively little E85 usage.
  • Other than raising the blend mandate, the only real way to grow ethanol use is by E85.
  • Many/most flex fuel drivers (today) do not run on E85 because it is either hard to find and/or there is little financial benefit to doing so.
  • Some new flex fuel vehicles are optimized for E85, and their drivers will get a financial benefit, but they will only be a small portion of the market.

Specific Recommendations

  1. Scrap the VEETC (since there is a mandate already and the VEETC is scheduled to expire at the end of 2010).
  2. Maintain a producer’s credit for cellulosic ethanol, until 2015.
  3. Double the VEETC credit for E85 sales (as well as for 85% blends of methanol and mixed alcohols).
  4. Pay this credit to the retailer, not the fuel blender (if it is a different party).
  5. Place an export tax on ethanol equal to all the producer credits (including corn grower’s credit).
  6. Do not give any government subsidy for the pipeline – let the industry decide if they want to spend that money, or develop the market in their own backyard.
  7. Relax law allowing drivers (not retailers) to blend any amount of ethanol they like into their fuel.  i.e. mix E85 with regular gasoline in any proportion they want.

Projected Consequences

So, with a $0.90 tax credit on E85, drivers will have a real, immediate, and obvious monetary incentive to use it. Retailers, faced with making good margin on E85, will have good incentive to install pumps. The ethanol industry might even choose to partner with them to help pay for said pumps. The ethanol producers might even set up their own E85 stations at the distillery gate, just like wineries sell at the cellar door.

Fueling stations selling E85 and nothing else, supplied directly by the distilleries, will begin to appear, and would be VERY easy and cheap to set up, and would, of course, be within easy trucking range of said distilleries.

Drivers are legal to use higher mixes, but are not being forced to, and no one is selling higher mixes. The responsibility is purely with the drivers who decide to use higher mixes, or not, so the retailers/oil companies and ethanol industry are not liable for any engine problems (unless, of course, if the ethanol industry claims there won’t be problems).

Now, doubling the credit on E85 to $0.90 is a huge subsidy to the E85 users, but there are not that many of them (presently) so the total amount spent on this subsidy will be far smaller than the $6 billion/yr presently.

This plan leaves the oil refiners out of the ethanol subsidy business, but that is OK as they are mandated to blend x amount of ethanol, this is not destroying their business in any way – it is merely promoting an alternative fuel that they (to date) have refused to promote.

If the retailers and drivers “follow the money”, we would see a rapid increase in E85 usage, and I’ll bet it gets used more in corn country first, which is as it should be.

Conclusions

I agree with most of what Paul suggests, and believe it would create huge new opportunities for the domestic ethanol industry without the need for an E15 mandate. These policies would also move the industry closer to the generally accepted purpose of U.S. biofuel policy, which is to use biofuels to reduce demand for petroleum. The farther biofuels are moved from the point of production, the less petroleum they are able to offset due to the energy cost of moving the biofuels.

However, I don’t believe the subsidy would need to be as high as $0.90 per gallon. I certainly think such a high subsidy would result in explosive growth for the E85 industry, but then we would once again have to contend with a $6 billion ethanol subsidy in just a few years. I think the same goal could be accomplished with a subsidy of around $0.50/gallon.

According to E85.com, over the past year E85 has been anywhere from 10% cheaper to 22% cheaper than gasoline. Given an observed E85 energy penalty of 25-30%, it is likely that E85 would need to be consistently 30% cheaper than gasoline to build a substantial market. (Another possibility is the continued development of engines that can reduce the E85 energy penalty by using higher compression ratios; if you only lose 10% fuel efficiency on E85 then you will happily buy E85 at only a 15% discount to gasoline).

The narrowest spread between E85 and gasoline over the past year occurred in December 2009 when gasoline was $2.56 per gallon and E85 was $2.30 per gallon. To increase that narrowest price spread back to 30% would require an additional E85 subsidy of $0.51 per gallon. At the widest spread over the past year in May 2010, this level of subsidy could have had E85 undercutting gasoline by more than 40%. At that price spread, E85 demand would grow rapidly.

Given the meager level of E85 sales in the U.S. today, this level of subsidy would be far lower than present ethanol subsidies, while providing strong incentives to build out E85 infrastructure and E85 vehicles. Further, it would actually strengthen the energy security of the Midwestern states well beyond the status quo.

  1. By little wally on August 16, 2010 at 9:09 am

    Difficulties in marketing E85 have been known for several years. Are there any good case studies of successful (profitable) E85 marketing? There has been millions of dollars of state and federal subsidies for E85 marketing etc.(beyond the basic VEETC) – any success stories? If there are over 2000 E85 nozzles out there, I’d like to think that at least 50-100 of them might actually be covering their costs and gradually increasing their sales? Are any selling close to 10,000 gal / month?

    Also, is there any proof of lower mileage penalty for these new FFVs (Buick Regals?) that are ‘optimized’ for E85? We heard a lot about that for the Saab Biopower a few years ago, and that never materialized.

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  2. By takchess on August 16, 2010 at 1:34 pm

    If I lived in the Midwest (which I don’t) these would be the conditions I would need.
    1) I plan on buying a new car (which I’m not)
    2) availability of a E85 car in the class I would want
    3) cost delta of E85 to Gas car be in a range that is acceptable
    4) cost of mile driven for E85 to be about 20% less than gas.
    5) my belief of the long term viability of any tax programs, e85 infrastructure and long term cost stability of e85

    That’s a lot of conditions which are not easy to meet.

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  3. By takchess on August 16, 2010 at 1:38 pm

    I’d like to add :  If you met those conditions for alot of midwestern drivers E85 cars would sell like hotcakes. I think one needs to hit a compelling cost advantage per mile driven as a risk premium. It’s not enough for the costs to be the same.

    I would wish this type of plan great success.

     

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  4. By Benny BND Cole on August 16, 2010 at 1:47 pm

    I propose an “urban liquid fuel” subsidy, to make fuel from urban waste. We could mandate that another 10 percent of US gasoline use this urban liquid fuel, and that it would receive total subsidies up to $1.50 a gallon (similar to that the CBO says ethanol gets).
    The “urban liquid fuel” program would mirror our corn ethanol program–and since that is accepted policy, I see no reason not to embrace an “urban liquid fuel” program as well.
    The urban liquid fuel would negate the need for expensive national pipelines.

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  5. By doggydogworld on August 16, 2010 at 2:10 pm

    Isn’t your additional 0.50 E85 subsidy roughly the same as doubling the current E85 subsidy, as the reader proposed?

    I also think we need to require FlexFuel in all new cars, or at least all new cars in the Midwest (with the rest of the country, who benefits from reduced gasoline consumption, footing the bill). As long as we’re on the topic, true FFVs which can also handle M85 should be in the discussion.

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  6. By Wendell Mercantile on August 16, 2010 at 2:27 pm

    cost delta of E85 to Gas car be in a range that is acceptable

    takchess,

    The AAA has a very good website that shows the true cost of E85 compared to gasoline when adjusted for energy content: AAA Daily Fuel Gauge report

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  7. By carbonbridge on August 16, 2010 at 2:38 pm

    Benny BND Cole said:

    I propose an “urban liquid fuel” subsidy, to make fuel from urban waste. 


     

    Wonderful idea Benny!

    • I’m curious, what variety or flavor of new ‘urban fuel’ are you thinking about? 

    • And what ‘processing mechanism’ would most profitably produce it? 

    Because carbon is a carbon is a carbon atom as a basic fuel building block, I’ve long advocated recycling society’s daily waste streams of carbonaceous solid materials instead of planting, fertilizing, watering, weeding and annually harvesting any agri-based plant solely for its carbon content.  Thus clean-gasification of these urban waste solids as the new fuels ‘front-end’ is a no-brainer.  Then what sort of ‘back-end’ and biofuel output would you suggest?  Thanks.

     

    –Mark

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  8. By Wendell Mercantile on August 16, 2010 at 2:54 pm

    Then what sort of ‘back-end’ and biofuel output would you suggest?

    You didn’t ask me, but I’d suggest methanol for spark ignition engines, and dimethyl ether (DME) for compression ignition and turbine engines.

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  9. By garsky on August 16, 2010 at 2:58 pm

    I thought about the ethanol dilemma as I was gassing up last week. What made the trip to the gas station memorable for me was for the first time in I don’t know how long the pump had a no-ethanol option, priced at $2.77 (vs. $2.57 for the E10 pump).

     

    The irony: I was in downtown Des Moines, Iowa.

     

     

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  10. By carbonbridge on August 16, 2010 at 3:19 pm

    Wendell Mercantile said:

    You didn’t ask me, but I’d suggest methanol  and dimethyl ether (DME)


     

    Wendell:  We’ve had some discussions on other RR threads about how clean methanol is and how well it performs when air/fuel ratios and spark ignition timing are properly adjusted.  A formerly available M-85 FFV chip does this automatically and ‘race car’ performance is achieved albeit with only 56,000 BTU’s per gallon of MeOH.  Twice the MeOH volumes compared to gasoline needs to be carried and combusted in order to provide gasoline’s mileage – except that the methanol is a lot, lot cheaper to synthesize and ostensibly purchase retail.  MeOH also provides a biodegradable exhaust emission when combusted neat and it instantly becomes VERY biodegradable bug, plant and tree food once diluted into water.

    Like MeOH, DME (gaseous ether) also carries a missing Oxygen atom in this gaseous formula and would be an excellent and very clean-burning fuel for operating fixed-turbines like those generating peaking power in electrical plants.  However you will never convince me that ANY highly pressurized gas stored in composite-wound cylinders in a vehicle’s trunk has ANY place in the transportation sector.  While DME only needs about 125 psi (comparable to bottled propane or butane pressures) – it is still too dangerous to be traveling 80 mph stop and go on the Los Angeles freeways.  Compressed natural gas is bottled to 3,000 psi and Gov. Arnie’s Hydrogen Hallucination would need H2 bottled to 10,000 to 15,000 psi.  Any use of highly pressurized gasses should be limited to gen-sets which are firmly bolted to terra-firma, not traveling about in bumper to bumper traffic.

    Benny suggested Urban Wastes as feedstock and I heartily agree!  He’s been a proponent of T. Boon’s proposal for compressed natural gas available at your corner filling station.  Therefore I’m interested in learning what fuel Benny thinks Urban Wastes would be successful in the near-term of profitably producing — thus positively contributing in the whole space of federally mandated Renewable Fuels Standards wherein new biofuel volumes are NOT being met, not even close.

    –Mark

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  11. By takchess on August 16, 2010 at 3:56 pm

    Thanks Wendell
    Re: cost delta of E85 to Gas car be in a range that is acceptable
    takchess,
    The AAA has a very good website that shows the true cost of E85 compared to gasoline when adjusted for energy content: AAA Daily Fuel Gauge report

    This line refers to cost of the car itself. I still would look for 20ish % less per mile driven for cost of fuel.

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  12. By Rufus on August 16, 2010 at 4:31 pm

    Alltogather, a pretty reasonable plan, I think.

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  13. By Rufus on August 16, 2010 at 5:00 pm

    Of course, what I really think is that ALL ethanol subsidies will go away on Jan 1st. I just don’t see the interest, anywhere, to renew them.

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  14. By Benny BND Cole on August 16, 2010 at 6:02 pm

    Guys, I am just a furniture maker in Los Angeles. I make tables for sports bars now, sportsbartables.com. I used to be a financial journalist. I don’t know what to do.

    I tongue-in-cheekily suggest urban liquid fuels as an Obama program that would surely be the object of intense right-wing scorn and derision. Imagine Obama mandating that 10 percent of US gasoline be derived from urban waste, and then spending up to $1.50 a gallon to obtain that result. Oh, the howling!!

    But that is what we have now–just sub “corn” for urban waste.” (And consider water usage, the dead zone off the Mississippi etc–actually urban fuels probably makes better sense).

    If anyone knows how to convert urban waste into methanol or ethanol at the same costs as corn ethanol, I would like to hear from you–I can still write an article for several publications out there.

    Now, for RR, here is some news that I hope he understands because I sure don’t:

    Oxford Catalysts Reports Microchannel Biomass-to-Liquids FT Pilot at Güssing Showing 4-8x Greater Productivity Than Conventional Systems
    16 August 2010
    Oxford Catalysts Group PLC, reported that its microchannel reactor Fischer-Tropsch (FT) pilot unit is achieving good performance in phase one of the demonstration at Güssing (earlier post) and that it remains on track to secure a commercial order upon completion of the technical milestones.

    The company said that the operations are demonstrating the very significant process intensification potential of its microchannel FT technology, as the unit is already producing more than 0.75 kg of FT liquids per liter of catalyst per hour—some 4 to 8 times greater productivity than conventional systems. Performance will improve further after the steam superheating section of the plant is debottlenecked at the next scheduled shutdown.

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  15. By Rufus on August 16, 2010 at 6:55 pm

    Benny, if you’re referring to “sewage,” that seems to work best with anaerobic digestion to biogas, and fertilizer. Brooklyn has been doing this for a Long time. Probably, over a hundred American Dairies do this, also. They generate electricity with the biogas, and sell it to the grid (IIRC, it takes 5, or 6 Cows to power a house.)

    As for “Solid” waste, about 40% is readily convertible to ethanol. Fiberight is the leader in this. They don’t look like they’ll need any subsidies.

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  16. By rrapier on August 16, 2010 at 6:55 pm

    Now, for RR, here is some news that I hope he understands because I sure don’t:

    Benny, I know them quite well. I have visited their facility. But I can’t discuss them.

    RR

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  17. By rrapier on August 16, 2010 at 7:01 pm

    Isn’t your additional 0.50 E85 subsidy roughly the same as doubling the current E85 subsidy, as the reader proposed?

    I actually had the same thought. I went back and forth on this. It is true that today E85 can benefit from a $0.45 per gallon subsidy, so if I consider that the deltas I looked at are fully benefitting from that subsidy, then your statement is true. Yet at the current subsidy level, there are almost no E85 sales. But since the current subsidy goes to the blender, changing to $0.50 and giving it to the retailer should be substantially different than the dynamic currently in place. I think it would accomplish the goal of fast E85 growth. But it might actually take double the current subsidy. If I proposed something like that, I would propose it with a phase-out scheduled. $0.90 for the first 2-3 years, then $0.60, etc.

    RR

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  18. By rrapier on August 16, 2010 at 7:15 pm

    If you met those conditions for alot of midwestern drivers E85 cars
    would sell like hotcakes. I think one needs to hit a compelling cost
    advantage per mile driven as a risk premium. It’s not enough for the
    costs to be the same.

    Not only that, but people are going to want more than an equivalent cost per mile if they have to fill up more often. If the costs are the same and have to fill up 20% more often, they will go for the more convienent option. So I think E85 has to beat “equivalent cost per mile” for that reason as well.

    RR

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  19. By Kit P on August 16, 2010 at 7:50 pm

    Better how?

     

    There is that old adage, it it ain’t
    broke don’t fix it.

     

    This is a classic case of not liking
    the results so change the rules. California, NY, New England, and
    Washington DC wants renewable energy. These same people define not
    NIMBY. So where are windmills and the ethanol plants getting built?

     

    Pragmatic rural people are willing to
    place energy projects in their communities because they will benefit
    from the jobs and the property taxes.

     

    Benny writes:

     

    But that is what we have now–just sub
    “corn” for urban waste.”

     

    Benny there is nothing in the current
    energy policy that gives corn a special advantage in the rules. What
    makes you think the urban waste will not come from Iowa City, Iowa in
    stead of the LA?

     

    I have documented the California
    debacle here.

     

    http://www.consumerenergyrepor…..ed-for-it/

     

    The fallacy of RR’s ‘rationality’ is
    not understanding US government. True senators and congressmen can
    bring home special projects. However, national scale programs need
    broad support. This is why it took so long to get the 2005 Energy
    Bill.

     

    If if congress ganged up on the
    midwest, SOCUS would throw it out.

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  20. By Rufus on August 16, 2010 at 8:23 pm

    Yeah, don’t overlook that Iowa is the No 2 state in “Wind” energy. Basically, a couple of those Midwestern states just like “Renewables,” period.

    A fellow that contributes over at e85vehicles.com is connected with a company that has twenty, or so, E85 locations. His company, Renew, always has a nice twenty someodd percent price spread, but he says people don’t get very interested in E85, at “any” spread, until gasoline prices get up around $2.90 – $3.00/gal.

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  21. By rrapier on August 17, 2010 at 1:46 am

    Better how?

    That was quite clearly explained in the “Rationale” section. Ethanol producers are currently pushing to expand their markets by higher mandates, pipelines, and exports. The plan laid out here makes far more sense from an energy security POV.

    The fallacy of RR’s ‘rationality’ is not understanding US government.

    Antis say things like that. But there is no fallacy in my rationale. Midwestern senators are interested in building out ethanol markets. Here is a plan to triple their market. And even the ethanol industry is interested in the plan, as they are actively linking to it and passing the information on.

    This is why it took so long to get the 2005 Energy Bill.

    Believe it or not, we had plenty of energy bills before 2005. All required broad support for passage. Just Google Energy Policy Act of (insert year here).

    RR

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  22. By rrapier on August 17, 2010 at 1:48 am

    Rufus said:

    Yeah, don’t overlook that Iowa is the No 2 state in “Wind” energy.


     

    Iowa is going to be my case study in the next post.

    RR

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  23. By Rufus on August 17, 2010 at 2:57 am

    You have the capacity to shock some people, then. I was amazed a few weeks, ago, when I looked it up on Wiki. Everybody thinks “Corn, and Hogs.”

    Agriculture is a very small piece (3.5%) of Iowa’s economy. Manufacturing is 22.9%. Retail Trade is 6.9%. Here’s a chart:

    http://en.wikipedia.org/wiki/F…..s_2006.jpg

    It’s a pretty impressive state.

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  24. By paul-n on August 17, 2010 at 3:13 am

    RR,

    Thanks for your post about my ethanol plan.  The thing I like most is that it is geared towards replacing gasoline with ethanol, rather than just diluting gasoline with ethanol.  In doing so, it will show whether creating a (localised) “ethanol economy” is possible, or not.  I would like to think that the ethanol industry would be supportive of an ethanol economy.

    But to date, they have never (publicly) proposed any such thing.  Yet, they must have considered such a possibility, which leads me to the conclusion that they do not think it will be successful, and so they would rather chase higher dilution rates (e.g. E15).

    We have had people from POET and Growth Energy comment on this blog in the past, let’s hope they do so again here.

    The amount of subsidy required is a good question.  I think it needs to be high enough that anyone who owns an E85 car would want to use it.  But I can also see the point of Rufus’ Renew fellow, when gas is already “cheap” being even “cheaper” is not that great an incentive –  but since making gas more “expensive”, by taxes, is not a politically acceptable option, we have no alternative.

    A couple of other comments on the comments;

    Takchess, I agree with your pre-conditions except the first.  There are already many people (8million) driving E85 cars, so there are plenty of people who do not need to buy a new car.  There are also ways to (cheaply) retrofit late model cars to E85, and for high mileage drivers, this would be worth it.  Same applies to ethanol boosted diesel engines – add on kits could be produced fairly easily (they already exist for methanol injection)

     

    Doggydogworld wrote;

    I also think we need to require FlexFuel in all new cars, or at least all new cars in the Midwest (with the rest of the country, who benefits from reduced gasoline consumption, footing the bill).

    While I like the idea of all new cars being flex fuel, I do not like the idea of requiring it in the Midwest – on principle.  I live in Canada and see on a regular basis what happens when you have Federal govt policies that apply to some parts of the country and not others, or unequally across the country (usually meaning they favour either Quebec or the Maritime provinces).  The government calls it “asymmetric federalism”, but I simply know as “favouritism”.  On principle, I think the Federal laws should apply to the all the country, or none of it, not force some people to have to do something just because of where they live.  This leads to, as George Orwell famously wrote in Animal Farm, some people being “more equal than others”, and I can think of no faster way for the “others” to lose faith and trust in their government, and the institution of government.

    As long as we’re on the topic, true FFVs which can also handle M85 should be in the discussion.

    Agreed, and if they can handle M85 they should also be able to handle mixed alcohols, and be materials capable (but may need a new/reprogrammed chip) for M and E100.

    The larger the fleet of alcohol capable vehicles, the larger the (potential) market for such fuels, and the greater the incentive to make them.

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  25. By Perry on August 17, 2010 at 5:48 am

    I think it would be good policy to encourage the adoption of the Ford Bobcat engine. While ethanol is less than 5% of the fuel mix, it cuts gasoline usage by 30% and gives diesel-like performance. Widespread adoption of the dual-injection system would conserve more fossil fuel than tripling ethanol production. It would also free up half the acreage now going to ethanol production.

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  26. By Perry on August 17, 2010 at 12:15 pm

    This is pretty interesting. A blend of 20% isobutanol and 80% ethanol has an energy density similar to gasoline.

    http://www.wired.com/autopia/2…..sobutanol/

    These guys did an IPO today. They claim they can make bio-isobutanol for half the cost of isobutanol from petroleum. An E80 blend with the energy density of gasoline would be sweet. Especially if it was 100% renewable.

    http://www.genengnews.com/gen-…..05/?page=1

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  27. By Rufus on August 17, 2010 at 8:29 am

    I think Ford is just going to go with the Regal-type engine. Same performance, less hassle.

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  28. By Rufus on August 17, 2010 at 9:27 am

    Maybe starting with that 6 cyl Ecoboost that’s coming out in the F150.

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  29. By Kit P on August 17, 2010 at 9:30 am

    “Believe it or not, we had plenty of
    energy bills before 2005. All required broad support for passage.
    Just Google Energy Policy Act of (insert year here).”

     

    Young man maybe you should show this old guy how
    it is done, using the web to get information. Having worked in the energy industry for four decades I
    think I would notice major energy legislation.

     

    Oh wait, when I do an Internet search I
    find exactly what I knew already. For example, if Google Energy Policy
    Act of 2003 you will find legislation that did not pass. Which is my
    point about the difficulty in changing policy.There is no Energy Policy
    Act of 2001, Energy Policy
    Act of 2002, Energy Policy
    Act of 2003, or Energy Policy
    Act of 2004 that made through for POTUS to sighn.

     

    Yes, we had energy bills, no they did not pass. 

     

    To find legislation promoting ethanol
    you have to back to Jimmy Carter and the Energy Security Act of 1980.

     

    If you look at 1980 to 2005, most
    people would call that a long time.

     

    The result of the 2005 Energy Bill is
    that we are producing ethanol at mandated levels. It is really hard
    to beat a policy that works. RR wants a regional policy for
    transportation fuel. If RR can show me where that has worked I will
    be glad to think that his idea is better.

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  30. By Kit P on August 17, 2010 at 9:41 am

    “Iowa is going to be my case study in
    the next post.”

     

    If California is a study in failure,
    Iowa is a study in success. While college professors at UC Berkely
    and Cornell were explaining why farmers in Iowa should not grow corn,
    universities in Iowa were helping farmers grow corn better. Boring
    maybe but trust me no one in Iowa cares what Senators form NY and
    California think based on out of touch college professors.

     

    UC Davis does a lot of good research on
    AD of animal manure but California has been one of the slowest to
    adopt proven technologies. So watching how the universities prepare
    local economies to prosper is one aspect of success. It would be
    interesting to see how long it takes to permit agriculture/energy
    project in Iowa compared to California.

     

    It boils down to states being prepared
    to help with the paper work to permit projects with environmental
    merit rather than tie everything up with red tape.

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  31. By Perry on August 17, 2010 at 9:50 am

    The Bobcat is an ecoboost engine with ethanol injection Rufus. The 20% efficiency gain of an ecoboost becomes 30%. And the torque increases about 20% too. The 2011 F-150 is a good start, but if you can increase torque and save another 10% on fuel economy just by injecting a little ethanol….

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  32. By Wendell Mercantile on August 17, 2010 at 9:50 am

    There are already many people (8million) driving E85 cars,

    Paul,

    That’s 8 million out of 250 million cars on the road — a bit more than 3%. Not really significant.

    U.S. ethanol production in 2009 was 10.6 billion gallons, compared to 137 billion gallons of gasoline. Ethanol was 7.1% of the total motor fuel, not counting fuel used in compression ignition engines.

    Ethanol production would have to increase from 10.6 billion gallons to 125.4 billion to make all motor fuel in the U.S. an E85 blend. Right now we don’t even produce enough ethanol to make all fuel an E10 blend.

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  33. By Perry on August 17, 2010 at 10:17 am

    The system works by injecting a blast of ethanol directly into the cylinder chamber before combustion along with a blast of petrol. The burning of ethanol has the positive side effect of cooling the combustion chambers, and when combined with the higher octane rating of the organic-derived fuel power and efficiency can be boosted.

    This characteristic also allows the engines to run at a higher compression as detonation is also reduced. The end result is diesel-like economy from a petrol engine. Such a set-up would require a second ethanol-only tank to be installed in the car but so little is used that filling this tank would only need to be done once every few months on average.

    Ford is working on the new system with Massachusetts-based firm Ethanol Boosting Systems, which has trademarked the term ‘Direct Injection Octane Boost’ to describe the process. According to the documents, the direct injection of ethanol effectively increases the octane of regular petrol from 88-91 octane to more than 150 octane. Using such technology, a 5.0L V8 Bobcat engine could potentially produce 500hp (373kW) and 750lb-ft (1,015Nm) or more of torque.

    http://www.motorauthority.com/…..-documents

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  34. By carbonbridge on August 17, 2010 at 1:22 pm

    Perry said:

    This is pretty interesting. A blend of 20% isobutanol and 80% ethanol has an energy density similar to gasoline.


     

    Perry:  I find this claim above to be fictious.  Gasoline is a hydrocarbon, ie: with no oxygen content.  You’ll find most gasoline in the USA to be about 112,000 BTU’s per gallon.  Sometimes it will be as high as 115,000 BTU’s.

    Iso-butanol and ethanol are both alcohols anchored with an OH group.  The oxygen atom that converts a hydrocarbon into a oxycarbon alcohol provides NO BTU of combustion strength whatsoever, yet the oxygen atom is central to how cleanly alcohols combust neat AND how this more efficient combustion (oxygen fanning the flames) will also combust more hydrocarbon petroleum-derived fuels which the alcohol(s) are blended into.  Better more efficient combustion leads to more engine torque coupled with a cleaner exhaust emission.

    So I’d be interested to see IF you or someone else would accurately publish a BTU value for 20% iso-butanol and 80% ethanol.

    If memory serves, RR made some claims on this blog from his own refinery experience in blending normal (n) butanol into gasoline as well as blending iso-butanol into gasoline.  The “iso” is a branched molecule, the (n) or normal classification is a straight-chain alcohol molecule.  If I remember correctly, RR said that normal, straight-chain alcohols were preferred.  RR can you comment further on this aspect?

    Last:  I went to both links you’ve inserted above to upgrade my memory.  And it turns out that Gevo is the one that pioneered genetically modified E-coli to somehow assist them with this fermentative batch process which others are also working on.  I wish them all well, I don’t hold aloft any candles for scaleability of another batch fermentation process leaving all sorts of carbon building blocks behind with each batch. And I do hope that none of this E-coli ever makes its way into a municipal water system.  Nuff’ said for now.  Thanks.

    –Mark

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  35. By Perry on August 17, 2010 at 1:52 pm

    Yeah, that link was wrong Mark. Butanol has a btu value of 110,000. Pretty close to gasoline’s 115,000. But, it obviously wouldn’t have the energy content of gasoline when blended with 80% ethanol. BP and Dupont are working on bio-butanol, and they provided the fuel for that car. It would be nice if their commercial plant can produce it at, or near, the cost of gasoline.

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  36. By rrapier on August 17, 2010 at 2:40 pm

    To find legislation promoting ethanol you have to back to Jimmy Carter and the Energy Security Act of 1980.

    Kit is wrong about that. His Google skills failed him. In 1998 they passed legislation to extend and modify the ethanol subsidies. In 2004 they passed legislation to change the exemption to a tax credit and extend to 2010. But that’s something that anti’s do Kit. They look for negative examples instead of finding the positive ones.

    RR wants a regional policy for transportation fuel. If RR can show me where that has worked I will be glad to think that his idea is better.

    That’s pretty much the norm, Kit. Areas tend to take care of their own fuel needs before exporting their surplus. You don’t see Saudi exporting so much oil that they have to import ethanol to make up the difference. And how many times have we laughed at the idea that Iran exports oil and imports gasoline? Not a very efficient way to do business. It would be different if Iowa was self-sufficient in ethanol, but producing ethanol in Iowa, shipping it to New York, and then importing gasoline to Iowa — when there was enough ethanol there — isn’t very smart. And if you stripped out the subsidies, we wouldn’t be doing it.

    But Kit, I would bet everyone else here is as puzzled as I am by your behavior. You complain when I criticize something, and now you complain when I promote something. I think you just like to complain, which doesn’t really do much to further the conversation. That’s why I get so many e-mails asking me to ban you so you will stop disrupting perfectly reasonable discussions.

    RR

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  37. By takchess on August 17, 2010 at 3:01 pm

    Speaking of Jimmy C, when I was with Air Products and Chemicals in 81 what were the labs working on ? …… Liquid Fuels from Coal, Goosing Oil Wells with gases to improve production, and spraying tires with extremely cold gases so they would be brittle and be recycled easier. We have come full circle.

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  38. By rrapier on August 17, 2010 at 3:38 pm

    If I remember correctly, RR said that normal, straight-chain alcohols
    were preferred.  RR can you comment further on this aspect?

    In the chemical industry, the straight chain molecule is preferred. There is a demand for the iso molecule, but it isn’t nearly as high. When I was a butanol engineer, we could make n/i ratios anywhere from 3 to 1 to 12 to 1. We always tried to operate at 12 to 1. But one of the risks for some of the i-butanol producers is that they may underestimate how much i-butanol capacity is out there. If there was suddenly a new i-butanol market that was attractive, a lot of new capacity could come on by merely tweaking the catalyst mix. Since i-butanol is generally considered to be a byproduct, it is hard for me to imagine that the Gevos of the world can compete against that.

    The link above on the fuel mix was interesting, because I wasn’t sure how i-butanol would behave as a fuel. That’s another question I have had as different companies attempt to produce i-butanol — how does it perform as fuel.

    RR

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  39. By Rufus on August 17, 2010 at 4:14 pm

    Perry, I think Ford has decided, “why mess with dual-fuel when you can get the same results by just running the danged thing on E85?”

    What I meant was, they’ll just make the Eco-Boost “flexfuel” ala the Regal Engine (use more EGR when cruising.) Dual-fuels have never been well-accepted. Suzie Soccermom isn’t going to like it, and it’s easier to get filling stations to install Ethanol if they’re selling it in 15 gallons quantities than it would be if they were selling it in 1.5 gal quantities.

    I’m looking for Ford to announce sometime next year that the 2012 3.5L Ecoboost in the F150 will turn 400 HP, and get the same fuel economy on E85 as gasoline. Well over 100 HP/Liter is easy in a turbocharged engine running E85.

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  40. By Kit P on August 17, 2010 at 7:02 pm

    “Kit is wrong about that. His Google
    skills failed him.”

     

    Let’s back up a second. I did the
    search that RR suggested but now I am wrong because I did not find an
    extension or clarification of existing policy dating back to Carter.

     

    “But Kit, I would bet everyone else
    here is as puzzled as I am by your behavior. You complain when I
    criticize something, and now you complain when I promote something.”

     

    Behavior? Gosh that sounds like a
    personal attack!

     

    In any case, my criticism is that your
    ideas will not promote the increased production of ethanol. Just an
    opinion however.

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  41. By rrapier on August 17, 2010 at 7:41 pm

    Let’s back up a second. I did the search that RR suggested but now I am wrong because I did not find an extension or clarification of existing policy dating back to Carter.

    No, you are wrong because you wrote “To find legislation promoting ethanol you have to back to Jimmy Carter and the Energy Security Act of 1980.” That is a false statement, plain and simple.

    In any case, my criticism is that your ideas will not promote the increased production of ethanol. Just an opinion however.

    But it’s an opinion based on nothing. You just pull things out of your head and say them. What is your justification? I can say with 100% certainty that if there was a $0.90/gal subsidy on E85 in Iowa that it would completely take over the fuel market. That would necessitate additional ethanol production as Iowa started to use their own ethanol. After all, California is still going to demand it.

    But you are entitled to your opinion, regardless of how vacuous it may be.

    RR

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  42. By Kit P on August 17, 2010 at 9:51 pm

    “But you are entitled to your
    opinion, regardless of how vacuous it may be.”

     

    I was thinking something like that
    about RR’s opinion. We had a different word for in the navy,
    something you will not find on a dairy farm.

     

    “No, you are wrong because

     

    RR want to forget he was wrong about me
    being wrong, now he is wrong about me being wrong.

     

    “But it’s an opinion based on
    nothing.”

     

    See that the thing RR, I went back and
    checked. I did present reasons. RR said my reasons were wrong, but
    I checked and I was not wrong. Then RR said my opinions were
    vacuous. That is called a circular argument.

     

    “I can say with 100% certainty that
    if there was a $0.90/gal subsidy on E85 in Iowa that it would
    completely take over the fuel market.”

     

    I know with 100% certainty that RR can
    not predict the future with certainty. In this case, RR
    is predicting something based on something that will never happen. It is called pretending. 

     

    It boils down to RR’s expressing an
    opinion about how things would turn out if his policy was adopted.

     

     

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  43. By rrapier on August 18, 2010 at 12:57 am

    Kit P said:

    RR want to forget he was wrong about me

    being wrong, now he is wrong about me being wrong.


     

    You are without a doubt the biggest time waster on this board. You make unproductive and factually incorrect statements, which people respond to, and then you just make more trying to defend them. You constantly hold the 2005 energy bill up as the first energy bill that had been passed in a decade. Not true. Your statement that you have to go back to 1980 to find pro-ethanol legislation wasn’t true. Your words are there for anyone to see; there is no reason for me to continue to point out that you were wrong. So stop wasting my time.

    I remind you that if you don’t have something that adds value to the conversation, then just hop over to someone else’s blog and waste their time instead. Or start doing something productive with your time for a change.

    RR

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  44. By SacE85 on August 18, 2010 at 1:03 am

    Robert, no need to water down the tax credit to $.50 per gallon. Petroleum already receives far more subsidies (direct, hidden, or otherwise) than that. No need to feel guilty for allowing a tax credit of up to $1.00 per gallon. I agree this should to go the retailer, not the petroleum companies. If one is concerned with expanding E85 pumps, no need to be timid about it. When one considers the immensely expensive alternatives (increasingly environmentally toxic fossil fuels, war in the Middle East, dead American soldiers and civilians, etc.) $1.00 is a small price to “not tax” this fuel. Besides, once it sufficiently replaces as much of the gasoline fuel market as possible, we should expect the government will tax it in the future, gaining many hundreds of billions of tax dollars in revenue. Why not consider it a loan now (any part above what it would have been taxed had it been gasoline) for future tax revenues? Paul Nash presented some very good points for your article, some more agreeable than others. Yes, the ethanol pipeline would not be needed right now if E85 were using up all the ethanol production in the Midwest. The problem is…it isn’t, and it will not anytime soon–not unless a significantly large “tax credit” is provided to E85 now. Right now. How long does it take to get something like this done in Washington? Years?

    So writing about what would be ideal, while we know what is logically able to occur, just doesn’t get us very far very fast–it might turn us backward. Though I will dream right along with those who would like to see E85 replacing gasoline altogether in the Midwest. During our awake hours, we need to work with the cards dealt to us. That includes keeping the biofuels industry alive while the alt fuels pumps continue their slow pace in replacing fossil fuel pumps; and working diligently over the years to speed up that pace. That is, unless one personally can control the President and members of Congress. If so, I encourage that person to get right to it.

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  45. By Rufus on August 17, 2010 at 11:38 pm

    This my be a first, Robert, M’boy; the owner of the e85vehicles.com blog is giving your article in forbes a positive review.

    The “end days” are, indeed, upon us.

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  46. By ronald-steenblik on August 18, 2010 at 4:15 am

    Robert,

    Sorry for coming late to this debate. No surprise, I agree with some of your and Paul Nash’s ideas, question others. I note, also, that in regard to this proposal both of you are silent as to what should be done about the import tariff. By the way, in the rest of my comments, “you” if not otherwise qualified is addressed to whomever endorses the statement on which I am commenting.

    Scrap the VEETC (since there is a mandate already and it expires at the end of 2010).

    OK. Actually, the way it is written it sounds as if you are saying that the mandate expires at the end of 2010. I know you know that it is the VEETC that is due to expire at the end of 2010. Whether the VEETC is allowed to expire remains to be seen.

    Maintain a producer’s credit for cellulosic ethanol, until 2015.

    And then what? Fine if you want the producer’s credit to expire after five years, but if you really mean that it should then disappear, you should state that clearly. If I were an investor in a new cellulosic ethanol plant, one which would only go into commercial operation only in 2013 and I was depending on that tax credit (which provides additional support to that provided by the RFS), then a two-year run of the production-tax credit would be virtually worthless.

    Place an export tax on ethanol equal to all the producer credits (including corn grower’s credit).

    What do you mean by corn-grower’s credit? Are you refering to straight commodity subsidies?

    Do not give any government subsidy for the pipeline – let the industry decide if they want to spend that money, or develop the market in their own backyard.

    Yup.

    Relax law allowing drivers (not retailers) to blend any amount of ethanol they like into their fuel. i.e. mix E85 with regular gasoline in any proportion they want.

    Agreed. Just make sure that the law is clear as to who is responsible if something goes wrong. In this case, caveat emptor?

    Double the VEETC credit for E85 sales (as well as for 85% blends of methanol and mixed alcohols).

    This is the one that raises lots of questions. In your article, Robert, you suggest that you would only increase the VEETC to $0.50 per gallon. You then add, in your comments on page 2, that “it might actually take double the current subsidy. If I proposed something like that, I would propose it with a phase-out scheduled. $0.90 for the first 2-3 years, then $0.60, etc.”

    I, too, assumed that Paul meant $0.90 per gallon of E100 blended in an E85 blend (which, of course, according to ASTM standards can actually fall as low as E70 in some northern states during some parts of the year, and still be labeled as “E85″ — have you guys thought about that?).

    That would be an enormous rate of subsidy, equivalent to around $1.35 per gallon of gasoline equivalent. If the intent is to target FFVs, we should bear in mind that most of the current fleet gets less (often far less) than 20 mpg on E85. Of the eighty-three 2011-model FFVs rated by the EPA, only 12 get better than 20 mpg on the highway. A large number are rated at 16 mpg in simulated highway driving, and 11 mpg in simulated city driving (or worse). Pretty pathetic.

    Moreover, if one works that out per FFV owner (typically not a person in the lower two quintiles of income), assuming that he or she drives the EPA’s standard 15,000 miles per year and tanks up only on E85 (and ignorring the fact that some of that E85 may actually be E in the 70s), would be $918 per year — over $9,000 over the life of the vehicle — in the case of a 2007 Chevrolet Tahoe FFV. (See Table 4.8 of Biofuels–At What Cost? for an explanation.) And that is not counting the cost of lost revenue to the Highway Departments of those individual states that offer additional tax reductions for E85.

    I can assure you, environmental groups would make hay over that kind of factoid. I wonder how many people who own a gas (or ethanol) guzzling FFV and another vehicle with much better gas milage would be willing to car pool for $900 per year?

    You guys also need to be clear about for how long you would maintain your subsidy. Your response on page 2, Robert, suggests that you would maintain it indefinitely. In that case, if it were successful, have you worked out the implications — for the budget, for grain prices, for the environment, for alternatives to ethanol — of expanding the supply of ethanol to the point that it really does start to account for a major share of the country’s fuel supply?

    If, instead, you are talking about a short-term measure, intended mainly to “jump start” the demand for FFVs and pumps that can provide high-number ethanol blends, what happens when the subsidy is withdrawn? Do you not risk creating an industry that then becomes dependent on the continuing flow of subsidies? And to the extent that investments are made on the expectation that the end of the subsidies will never happen (don’t forget that the VEETC and its antecedents always had expiration dates, and has so far always been renewed), how likely do you see it that politicians would actually stick to their (or, often, their predecessor’s) promise to phase out the subsidies? Volumetric (i.e., consumption- or production-linked) are much, much harder to phase out than programs supporting capital investment, which can be wound up without creating losses.

    Finally, in anticipation of a comeback from somebody like SacE85, who seems to be of the opinion that subsidies to gasoline are far, far higher per gallon than those to ethanol, I would suggest that if he or she believes such figures (I do not), then the standard policy prescription is to withdraw the subsidies, or to raise the price of gasoline by that amount. Trying to reduce subsidies to one fuel by subsidizing an alternative is both wildly fiscally imprudent and only exacerbates the problem, by encouraging artificially low prices for transport fuel and discouraging conservation and improvements in efficiency.

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  47. By ronald-steenblik on August 18, 2010 at 4:32 am

    Samuel Avro very kindly turned my comment above into an editable one, so I have modified it from the original.

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  48. By ronald-steenblik on August 20, 2010 at 7:51 am

    Back to Paul’s and Robert’s original idea:

    I think that the notion that there would be large positive externalities for the rest of the nation from increased biofuel use is a chalangeable one. To the extent that it would exert any downward pressure on petroleum prices in the rest of the country, that benefit could also be offset by higher food prices. That is why I am not keen on their extending or creating a new federal subsidy to be paid to retailers of E-85.

    However, there is nothing to stop state governments (except for the fact that many of them are broke) in the Midwest from providing such a subsidy themselves, or a higher state road tax on gasoline and diesel fuel, if they feel that there are important regional benefits of increased biofuel use.

    Meanwhile, let’s bring the import tariff on fuel ethanol into line with the import tariff on petroleum fuels — i.e., reduce it to close to zero — and stop penalizing consumers in the coastal states that would otherwise constitute the natural market for imported EtOH.

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  49. By Wendell Mercantile on August 18, 2010 at 8:56 am

    Relax law allowing drivers (not retailers) to blend any amount of ethanol they like into their fuel. i.e. mix E85 with regular gasoline in any proportion they want. Agreed. Just make sure that the law is clear as to who is responsible if something goes wrong. In this case, caveat emptor?

    One possible course of action to satisfy this would be for the ethanol industry to establish an engine damage contingency fund in advance to pay for damaged engines.

    Knowing someone would be responsible for damages, would greatly ease people’s minds about using higher blends of ethanol.

    The only downside would be trying to separate the legitimate claims from those gaming the system. Human nature being what it is, there would always be people making false claims.

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  50. By Kit P on August 18, 2010 at 9:01 am

    RR wrote,

     

    “You constantly hold the 2005 energy
    bill up as the first energy bill that had been passed in a decade.
    Not true.”

     

    I wrote,

     

    “However, national scale programs
    need broad support. This is why it took so long to get the 2005
    Energy Bill.”

     

    Since I closely watched the energy
    debate on the US capital from early in 2001 until the the summer of
    2005, I would assess my statement as accurate.

     

    I will reiterate my conclusion. You
    need a very compelling to reason to change policy. If it ain’t
    broke, don’t fix it.

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  51. By SacE85 on August 18, 2010 at 11:06 am

    Ronald Steenblik said:

    Finally, in anticipation of a comeback from somebody like SacE85, who seems to be of the opinion that subsidies to gasoline are far, far higher per gallon than those to ethanol, I would suggest that if he or she believes such figures (I do not), then the standard policy prescription is to withdraw the subsidies, or to raise the price of gasoline by that amount. Trying to reduce subsidies to one fuel by subsidizing an alternative is both wildly fiscally imprudent and only exacerbates the problem, by encouraging artificially low prices for transport fuel and discouraging conservation and improvements in efficiency.


     

    Ronald, I understand your concern about fuel subsidies.  In fact, it was not long ago that I was uneducated about how much hidden subsidization the U.S. government does for our fuel supply.  It’s not only the tax credits, research grants, etc.  It is also the social costs of pollution, and especially immense social costs like the oil that is now floating under the surface in the Gulf of Mexico, threatening the food chain and millions’ of good folks’ way of life.  Sure there’s $20 billion to be administered…we’ll see if that covers it and how many get turned away.  As well, it is the military protection of oil fields and shipping lanes.  In addition, the environmental social costs of “new” types of fossil fuels like tar sands and oil shale.  All of these things are a big question mark as to how much the subsidy is.  One can debate if this is a subsidy, but in the end it functions the same way.  When the oil companies don’t pay for all of these freebies, then it keeps the price of petroleum fuels artificially low at the pump.  Some who have studied this out are insisting that petroleum fuels should naturally be priced over $10 per gallon, were the oil companies paying for all of these freebies that the rest of society and tax payers are footing for them.

     

    So stating that it is incorrect to provide subsidies (actually that’s a reduction of taxes through tax credits, not quite the same as most other subsidies–a principle most conservative-minded people understand), makes it an impossibility.  If the person who controls the President and Congress can get on it, perhaps they will withdraw all military protection for the oil fields and shipping lanes, as well as slap an equivalent fee for each unit of pollution and economic harm brought on by the need to use petroleum.  Then gasoline can perhaps be naturally priced at the pump, somewhere likely over $10 per gallon.

     

    I am interested in dialoguing with you in the future when you have researched these massive hidden subsidies that petroleum enjoys, which the biofuels are placed at an extreme disadvantage against.

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  52. By ronald-steenblik on August 18, 2010 at 11:55 am

    SacE85,
     

    I am well familiar with the various estimates of subsidies to the petroleum industry, often having been a peer reviewer of such studies. (See the acknowledgements section of Doug Koplow’s and Aaron Martin’s 1998 study for Greenpeace, Fueling Global Warming: Federal Subsidies To Oil In The United States.) More recently I have been involved in work supporting the G-20 initiative to phase out subsidies to fossil fuels.
     

    There is, of course, many who feel that what should get counted as a subsidy to the petroleum industry should include much more than federal tax credits. (Please explain, SacE85: you count tax credits benefiting oil producers as subsidies, but you don’t tax credits to ethanol?) I would agree, up to a point. It is the attribution of hundreds of billions of dollars (as opposed to, say, a few tens of billions) a year in military spending to petroleum with which I differ. Robert Rapier has discussed this issue himself here.
     

    Some studies, such as the International Center for Technology Assessment’s 1998 study on The Real Price of Oil, count many subsidies and externalities that are not specific to oil, but to road transport — e.g., subsidies for road construction, the costs of car accidents, noise pollution from traffic, traffic congestion, urban sprawl, and so forth. If these “subsidies” are to be counted for oil, then they should count equally for other transport fuels.

     

    As for environmental damage, the jury is out as to the overall health effects of gasoline versus E85. And net contributions to greenhouse gas emissions depend on whether one accounts for indirect land-use change. Water pollution from oil spills, both large and small, is a big problem. In the case of big spills, like BP’s, at least there is some company that can take the blame, and be held accountable to. That is not the case for nutrient runoff, or for oil that gets into waterways from leaky crankcases (or people illegally disposing of used crankcase oil), which oil is also used as a lubricant in E85 vehicles.
     

    And, by the way, a lot of the natural gas used by the ethanol industry in its plants is associated gas — i.e., comes from wells (like the ill-fated one in the Gulf) that produce both oil and gas. So, for the moment, more ethanol production means more natural gas production, which, to some extent means more oil-and-gas wells.
     

    I agree that the world should try to wean itself off of petroleum. I am not convinced that subsidizing biofuels is the way to bring about that needed change.
     

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  53. By Rufus on August 18, 2010 at 1:48 pm

    Let’s keep one thing in mind: Inherent in all business plans for Cellulosic Ethanol Production is the use of Lignin, not Nat Gas, to power the process, and the sale/use of excess Lignin for Electrical Generation.

    One other thing: rather than constantly going back to the 2007 Tahoe, let’s look forward to the 2011 Buick Regal 2.0L, and all the engines, like it, that are on the way.

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  54. By ronald-steenblik on August 18, 2010 at 1:59 pm

    Rufus said:

    Let’s keep one thing in mind: Inherent in all business plans for Cellulosic Ethanol Production is the use of Lignin, not Nat Gas, to power the process, and the sale/use of excess Lignin for Electrical Generation.

    One other thing: rather than constantly going back to the 2007 Tahoe, let’s look forward to the 2011 Buick Regal 2.0L, and all the engines, like it, that are on the way.


     

    Amount of corn-based ethanol expected to be produced in the United States in 2010:      12,600.0 million gallons.

    Amount of cellulosic ethanol expected to be produced in the United States in 2010:                    6.5 million gallons

    Number of FFVs expected to be operating on U.S. roads by the end of 2010:                             9.5 million

    Number of FFVs that will get better than 18 mpg (combined city and highway) running on E85:  negligible

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  55. By Perry on August 18, 2010 at 2:44 pm

    “I agree that the world should try to wean itself off of petroleum. I am not convinced that subsidizing biofuels is the way to bring about that needed change.”

    The world has no choice Ronald. Peak oil will do the weaning for us. We either ramp up biofuel production now, or wait for supply shortages and then scramble like chickens with our heads cut off. 50 cents a gallon is chump change compared to what we’ll pay at the pump when oil producers come up a few barrels short. We supposedly had 2M bpd spare capacity when gas was selling for $4 a gallon back in ’08. God have mercy when that spare capacity turns negative.

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  56. By rrapier on August 18, 2010 at 3:16 pm

    Robert, no need to water down the tax credit to $.50 per gallon.

    Glad you stopped by SacE85. I have been reading your comments over at e85vehicles.com, and they were so far off the mark that I was thinking of registering there just to address your misconceptions.

    In fact, those misconceptions go all the way back to one of my early Forbes’ blogs on the redundant nature of the VEETC with a mandate in place. You made certain claims such as I am “an anti-ethanol guy” and that what I really wanted was to see “ethanol companies go bankrupt, the oil companies buy the ethanol companies, and then they lobby Congress to reinstate the blender subsidy.” Your comments were so nonsensical, that I had a hard time believing you were serious. Yet now I see more of the same over at e85vehicles.com.

    What you and at least one other poster there can’t seem to get through your head is that I am not anti-ethanol. You have a cartoonish idea of my position. If I criticize particular ethanol policies, that doesn’t mean I am criticizing ethanol as a fuel, nor promoting petroleum by default. I bet I could come up with hypothetical ethanol policies that you wouldn’t agree with, but then you would think it rather silly if someone painted you anti-ethanol as a result.

    What I try to do is promote policies that I think can result in long-term, sustainable solutions. I don’t view a redundant VEETC as such a solution; I think it is a waste of money. The oil companies are already compelled to blend the ethanol; why pay them to do it? Yet when I wrote about that at Forbes, you responded with your “anti-ethanol” comments.

    Now, over at the E85vehicles site, you have gone to great lengths to emphasize that these are not my ideas, these are Paul’s. Perhaps you are unaware that I have been arguing for incentivizing E85 in the Midwest for years now. I have mentioned on numerous occasions that this would be a more sustainable model than continuing to push E12 or E15 in the nation’s gasoline supply. I am a strong believer in taking care of local needs first with respect to food and energy, and then if there is excess to export the excess. That is the efficient, and ultimately more sustainable path.

    Yet you seem to believe that I suddenly got religion on the basis of Paul’s comments. Paul was responding to a post that I wrote in which I advocated for more E85 in the Midwest. He made some very specific recommendations that I felt were worth discussing. But now you accuse me of watering down Paul’s ideas and trying “to twist it into something that would be watered down and in a way continues the smear against ethanol.” Wow.

    In fact, on the specific comments in question, in which Dan M. at e85vehicles wrote “Robert makes some good points”, you responded with emphasis “Yes, Paul Nash made some very valid points. However, Robert goes on to try to strangle E85 by maxing out the tax credit at $0.50 per gallon. Be careful with this Robert fella, he speaks out of both sides of his mouth from what I have read from him so far.” So you are going out of your way to try and discredit me. The irony is that the points that Dan M. quoted were mine from the comments following the blog. It is your failure to understand the position that you are criticizing that leads you to believe that I am talking out of both sides of my mouth.

    Let’s address some specific comments, with the hope that you are actually interested in discussing ideas and not in promoting straw men. First, on the particular amount of a tax credit – $0.30 or $0.50 or $0.90 – I don’t know how much it should be. I can say that the latter would certainly do the trick, but you don’t want to throw more money at it than is needed. In hindsight I think $0.30 was too low, but that was just a number I grabbed out of the air.

    You are barking up the wrong tree with me and petroleum subsidies. If I had my way, we would pay the full costs of petroleum. That would be both an incentive to conserve and would level the playing field for biofuels. I have long advocated a different sort of tax system in which we place higher costs on fossil fuels (while reducing income taxes) to capture some of those externalities of using fossil fuels.

    So writing about what would be ideal, while we know what is logically able to occur, just doesn’t get us very far very fast–it might turn us backward.

    But the VEETC expires at the end of this year. It will either just go away, it will be extended in some form, or it can be modified as suggested here. It isn’t as if we are suggesting a brand new system must be built from scratch. The oil companies will still be required to blend 12.6 billion gallons of ethanol next year. But if the credit is modified to direct it only at E85 sales, then that would be sufficient incentive to kick start E85.

    RR

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  57. By Ignacio on August 18, 2010 at 3:20 pm

    What I need to KNOW!! is if the 9,000,000 FFV on the road today can use BOTH either or E85 and/or M85 with out further tinkering and if no one knows,
    Where can I find out, for a fact, not I think or it should or maybe.
    Thank you

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  58. By Perry on August 18, 2010 at 3:39 pm

    No, you can’t use M85 in modern FFV’s Ignacio. You can burn E85 in the old M85 FFV’s, but not the other way around. The M85 FFV had a plated overboost port on the intake and materials were used to make the fuel systems corrosion proof.

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  59. By Wendell Mercantile on August 18, 2010 at 4:23 pm

    let’s look forward to the 2011 Buick Regal 2.0L, and all the engines, like it, that are on the way.

    Rufus~

    Great technology in that 2.0 liter TDI in the Regal, and other car makers will follow, but this point bares remembering: Considering the half-life of the current U.S. car fleet, it will be years until there are enough of those Regals and their ilk on the road to make a significant difference.

    Roughly 250 million cars on the road today in the U.S. The new Regal might sell 70-80,000 units a year in the U.S., with perhaps half of those being the 2.0 liter TDI.

    40,000 is what percentage of 250,000,000? A: Two-hundredths of one percent. That’s 0.02 % (That’s nearly as bad as the immortal words of Dean Vernon Wormer in Animal House when he told the members of Delta House their cumulative GPA was, “Zero point zero.”)

    As you said, we have to start somewhere, but the Regal and its effect on U.S. motor fuel use will be a classic example of a pimple on an elephant’s behind.

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  60. By rrapier on August 18, 2010 at 4:36 pm

    I will reiterate my conclusion. You need a very compelling to reason to change policy. If it ain’t broke, don’t fix it.

    Policy is set to change at the end of this year when the tax credit expires. They are trying to figure out what to do. The ethanol lobby must believe something is broke to push for taxpayer-funded pipelines and higher ethanol blends. But I will pass on your comments that there is no need, because nothing is broke.

    RR

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  61. By Rufus on August 18, 2010 at 4:42 pm

    Hello, is this thing working?

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  62. By carbonbridge on August 18, 2010 at 5:10 pm

    Ignacio said:

    [Can the] FFV on the road today can use BOTH either or E85 and/or M85 with out further tinkering –?


     

    Mr. or Ms. Ignacio:  Beyond what Perry has just described, please realize that a FFV chip first operates by sensing the Oxygen concentration in the blended fuel coming from the tank.  Methanol at 56,000 BTU’s per gallon features 50% dissolved Oxygen content.  Ethanol at 75,500 BTU’s features 33% Oxygen content.  The FFV chip initially sensing Oxygen content (no Oxygen in gasoline) is even ‘sensing’ far smaller amounts of alcohol (2% to 10% consumer varieties) blended into gasoline all the way up to 85% volumes of blended alcohol with 15% volumes of hydrocarbon gasoline.  So anyone purchasing a new car would benefit from an FFV chip even if they don’t have E-85 available (yet) in their own community.  This same low-cost FFV chip will ‘fine tune’ and adjust the engine for far lower alcohol blends served up at most gasoline pumps around the country.

    The FFV chip next calibrates the fuel injectors to open up and spray more fuel into the piston cylinder depending upon programmed rates for how many BTU’s would logically be in the blended fuel arriving at the fuel injectors – all based upon dissolved Oxygen content which fans the flames increasing combustion efficiencies – yet this same Oxygen content does NOT contribute one BTU to the liquid fuel itself.

    So IF you substituted M-85 (and M-85 isn’t being produced and sold anywhere anymore that I know of) into a E-85 FFV-equipped auto – based solely upon Oxygen content – the engine would be running lean. The FFV chip thinks that the Oxygen which it senses is coming from ethanol, not methanol with less BTU content and more Oxygen content.

    The final engine adjustment the FFV chip directs after air/fuel ratio via fuel injectors is determined is radical spark ignition advance.  Methanol and Ethanol are only about 1 point octane different, so spark advance timing is essentially the same.  And once the ‘sweet spot’ for spark advance is made, the engine typically provides more torque power and a reduced emissions profile.  (Seems like I’ve written this answer here several times before.) 

    The air/fuel ratio adjustments to the fuel injector volume squirts is the big item here Ignacio.  The correct air/fuel combustion ratio (determining rich or lean mixtures) would be off-balance unless the FFV chip ‘knows’ what kind of alcohol has been pre-mixed with gasoline.

    New FFV chips should have at least three (if not six) manual settings on a switch located in the glove box where the motorist could ‘instruct the FFV chip’ as to what sort of alcohol/gasoline blend was being combusted.  We’ve had other discussions here on RR’s threads about this topic.  And people with some experience in driving FFV-equipped autos would like to see E-100 or M-100 capabilities as well as E-85 or M-85 fuel ratios – ALL working appropriately in the same car or pickup via one FFV chip.  I heartily agree!

    Plus there is a new generation of patented, stronger BTU higher mixed alcohols which will be coming into the marketplace which should also have manual adjustments integrated into a multi-alcohol version of new FFV chip — as this new blend of synthetically-produced mixed alcohols has about 34% Oxygen similar to C2 ethanol — but 20% more BTU’s (90,400) than fermented corn ethanol or about 40% more BTU’s than C1 methanol itself contains.

    –Mark Radosevich

     

    •••••••••••••••••••••

     

    [ RR:  I wasn't aware of so many discussion threads going on at SacE85.  I could not even locate the discussions which you were quoting above as there are soooo many active topics over there.  But I did see Rufus posting in these blogs, over 700 posts.  So Rufus, are you really just a retired insurance peddler and keenly interested in corn ethanol?  I acknowledge that you have previously refused to unmask from your alias and discuss your interests using your own real name.  Certain folks still think you are a paid lobbyist for corn ethanol.  And to add fuel to the fire, I publicaly agree that continual arguments which Kit P instigates with the moderator of this site are a willful waste of people's time who are seeking qualified information, accurate energy data or insightful political discussion.  I'd personally prefer to join public or private Roundtable Discussions only with people willing to unmask and publish their true identities with contact information.  Mr. Samuel R. Avro - site administrator, what do you think? ]

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  63. By rrapier on August 18, 2010 at 5:22 pm

    I wasn’t aware of so many discussion threads going on at SacE85.

    Mark, try this thread: http://e85vehicles.com/e85/ind…..951.0.html

    RR

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  64. By Rufus on August 18, 2010 at 5:23 pm

    Carbonbridge, I, also, post at various sites as a strong supporter of Solar, and Wind Energy. Most of my postings, now, are on my plan for small cellulosic refineries in every county. No one ever asks an anti-ethanol poster to post his name, and phone number. Why do you heckle me?

    BTW, the main reason your assertion doesn’t make sense, is I post on the wrong blogs to be a “paid lobbyist.” No offense to Sam, and Robert, or to the proprietors of the other blogs I post on, but, a “Pro” would “go where the action is.” If I was going to hire a “blogger” I would insist that they be “first up” on blogs like the NYT, Forbes, WSJ, etc, etc.

    I’ve been retired for several years, and I while away my days bloviating about energy. It interests me, and I think it’s important.

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  65. By John McKelvey on August 18, 2010 at 9:37 pm

    Rufus,

    Glad to see you are alive and kicking,,,,,,,,,,

    Just as the type-writer was replaced by the modern PC Keyboard, so will the ICE be replaced by electric vehicles.,

    No need for bio-fuels

    John

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  66. By savro on August 18, 2010 at 9:37 pm

    Rufus said:

    What if electric cars Don’t win out in the end. Spain has done a magnificent job installing ‘Wind”, and “Solar.”

    Electric Cars sold to date in Spain: 12


     

    I don’t see EV’s and wind/solar as being mutually exclusive. On the contrary, they feed off of each other since an influx of electric vehicles would increase the demand for electricity. However, the question you were responding to sounds silly to me at best.

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  67. By savro on August 18, 2010 at 9:39 pm

    John McKelvey said:

    Just as the type-writer was replaced by the modern PC Keyboard, so will the ICE be replaced by electric vehicles.,

    No need for bio-fuels

    John


     

    John, would you care to expound on this claim?

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  68. By Kit P on August 18, 2010 at 10:01 pm

    John, I learned to type on a manual
    typewriter. PCs are better.

     

    I learned to change the plugs and
    points on a ’60 Ford Falcon. I bought my ’89 Ranger with 200k miles
    about 10 years ago for $1200. Since then I have had done is to
    replace the battery twice and starter and alternator once. This was
    about the cheapest POV and now has 260k miles and does burn oil.

     

    ICE got a lots better over the years
    and for the foreseeable future will be better than BEV.

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  69. By John McKelvey on August 18, 2010 at 10:04 pm

    Sam ASuro.

    Well,

    Wind and solar both work as a means of generating electricity. Both produce electricity that is generally more expensive than that provided by standard fossil fuels such as coal and natural gas.

    With a few exceptions solar and wind are NOT competitive with fossil fuels.

    I agree with your point. What difference does it make
    where the electricity comes from…………?????

    John

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  70. By savro on August 18, 2010 at 10:21 pm

    John,

    I think you misunderstood the point I was arguing with Rufus. All I said was that electric vehicles will increase the demand for newer sources of electricity rather than negate the need. My point was that it isn’t an either/or of either electric vehicles or wind/solar.

    Still waiting for you to expound upon the claim that the ICE will be replaced by electric vehicles.

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  71. By rrapier on August 18, 2010 at 10:24 pm

    Why worry about bio=fuels and oil substitutes if electric cars win out in the end ?

    The operative word is “if.” We don’t know what will win out in the end. We try to anticipate that, but my view is that we will always have a demand for liquid fuels.

    RR

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  72. By John McKelvey on August 18, 2010 at 10:35 pm

    Kit.

    The internal combustion engine will NEVER be as efficient as an electric motor that commonly operates at about 90% efficiency.

    Even the brand new HCCI “turbine” liquid fueled rotary engines are only about 60% efficient,
    ………………………………………….
    The standard ICE,will NEVER give you the efficiency of even a common electric motor that you might happen to find in your workshop.

    John

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  73. By savro on August 18, 2010 at 10:38 pm

    Robert Rapier said:

    The operative word is “if.” We don’t know what will win out in the end. We try to anticipate that, but my view is that we will always have a demand for liquid fuels.

    RR


     

    To me it looked like John was using “if” as the short way of saying “since we know it to be true that…”. Especially once he followed up that post with:

    Just as the type-writer was replaced by the modern PC Keyboard, so will the ICE be replaced by electric vehicles.,

    No need for bio-fuels

    I’m still waiting for him to explain to us why he considers this to be so.

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  74. By savro on August 18, 2010 at 7:37 pm

    Rufus said:

    Hello, is this thing working?


     

    Rufus,

    I suggested this to you previously, but I’ll say it again. The spam filter operates in a funny manner at times and flags legitimate comments as spam (especially when they contain links). To avoid the spam filter, I suggest you make your posts in the forums (your posts will still be displayed within RR’s blog posts) while logged in to your user account.

    To explain how the commenting works over here from a technical standpoint, in short: Comments posted within the blog posts are turned into forum comments –but not until passing through the commenting system’s spam filter– then turned into forum comments which are also displayed in the blog posts (the 15 most recent on each blog post). The spam filter is essential because we receive a ton of spam comments on a daily basis, and it usually does a good job in blocking those comments. Posts made on the forums, when logged in, do not get routed through the spam filter.

    Since all comments ultimately end up as forum comments, there are no drawbacks to posting your comments by using the forum rather than the blog comment box. The only reason we allow comments to be submitted from within the blog posts is because it encourages new guests to comment.

    Regular commenters should register and leave their comments when logged in on the forums. There are additional perks, such as, a text editor and the ability to post (relevant) images and graphs.

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  75. By Rufus on August 18, 2010 at 7:47 pm

    Sam, I was “logged in,” and then the next day it wanted me to do it all over again. In the meantime I had “misplaced” my ID, and it just seeme/seems easier to just comment on the blog. (heck, nothing I put up is all that important, anyway.) :)

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  76. By savro on August 18, 2010 at 7:56 pm

    Rufus said:

    Sam, I was “logged in,” and then the next day it wanted me to do it all over again. In the meantime I had “misplaced” my ID, and it just seeme/seems easier to just comment on the blog.


     

    Not sure why that would happen, but your login info can be sent to your e-mail.

     

    (heck, nothing I put up is all that important, anyway.) :)

    Good point… and an important one Laugh

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  77. By Kit P on August 18, 2010 at 8:13 pm

    important one

    I must disagreee, Imust, I must, …

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  78. By John McKelvey on August 18, 2010 at 9:08 pm

    Robert.
    .
    Why worry about bio=fuels and oil substitutes if electric cars win out in the end ?

    John

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  79. By Rufus on August 18, 2010 at 9:13 pm

    What if electric cars Don’t win out in the end. Spain has done a magnificent job installing ‘Wind”, and “Solar.”

    Electric Cars sold to date in Spain: 12

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  80. By Rufus on August 18, 2010 at 11:05 pm

    I guess I didn’t express myself very well. I’m not against Electric Vehicles. I’m sure they will be just perfect for some people. I have serious doubts about their ability to “reach the masses,” at least, in anything resembling the short/medium terms.

    My point was, that even in a country that has strongly embraced “green” energy they just haven’t “caught on,” at all. Maybe they will. Maybe that wasn’t a good example. But, maybe the Spaniards just don’t want a car that is that limited in range. Maybe most Americans won’t. We’ll see.

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  81. By John McKelvey on August 18, 2010 at 11:19 pm

    The reason is that electric motors are more efficient than internal combustion engines, Look for them to replace the ICE as oil becomes more scarce and prices go up,

    John

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  82. By Rufus on August 18, 2010 at 11:31 pm

    John, have you ever considered the value of a nine year old car with a “Dead” battery? Can you imagine trying to sell one? Trade it in?

    Jes sayin’

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  83. By Rufus on August 18, 2010 at 11:39 pm

    Autobloggreen has an article on a new Turbo DI engine that GM is developing with a Chinese Co. It will range from 1.0L to 1.5L.

    Put one of these in a Cruze (Volt w/o the battery,) and you’re probably good for 50 miles on a gallon of E85. You might be looking at between $0.035 and $0.04/mi. With unlimited range, and convenience.

    Don’t be surprised if a lot of people choose the ethanol car. :)

    Or, you could pay an extra $10,000.00, or so, and have a battery car with limited range, that will be worthless somewhere around its ninth, or tenth birthday.

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  84. By savro on August 18, 2010 at 11:45 pm

    John McKelvey said:

    The reason is that electric motors are more efficient than internal combustion engines

    John


     

    That’s it? What about the high prices for batteries, very limited range and lack of necessary infrastructure? Don’t get me wrong, I’m of the belief that EVs will play a large role in the years to come, but I don’t see it turning the ICE into a typewriter in the near future.

    Look for them to replace the ICE as oil becomes more scarce and prices go up

    How about if biofuels can be produced and sold at a cheaper cost to the end user? If the viability of EVs are dependent upon higher oil prices, why don’t biofuels stand a chance of competing with them?

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  85. By SacE85 on August 19, 2010 at 1:28 am

    Robert and Ronald, I am not interested in debating you.  I’m just listing facts for others to consider.  It is obvious that we have to agree to disagree.  I totally disagree with some of your thoughts, and agree with a few others.  Yes Robert, for now I do believe you speak out of both sides of your mouth.  In the end, you’re not very favorable towards ethanol, but will say some things that sound favorable to ethanol to cause division.

     

    Ronald, getting nit picky about what is a subsidy or a tax credit was not at all the focus of my post.  Rather, that a tax credit is not a subsidy in the same way that some “give-aways” are true subsidies.  It was much more important to consider the immense hidden subsidies that petroleum receives.

     

    I will not be typing on this particular thread again.  We don’t agree.  That’s not going to change over night.  Robert, you would like to see something other than petroleum and probably other than ethanol become the next fuel, perhaps that would be methanol–concealed jealousy?  I just don’t have the time for this thread.  I may check back in later.  And in no way are my ideas faulty (perhaps not perfect, but well thought out anyway); we can go back and forth calling each other names and our ideas faulty, blah, blah, blah.  In the end it wastes my time, and it divides biofuels supporters.  That very likely is the goal of your articles.  It really doesn’t matter anyway.  Who’s listening?  Do you control the President and Congress? 

     

    Robert and Ronald, I am sure that you are very intelligent.  I can tell that you are.  I am too.  We just differ on our preferences.  It’s nauseating for intelligent people to debate their preferences, and most often just a waste of time.  In the end we are Americans and care to get off of our petroleum dependence.

     

    The momentum is hugely in favor of ethanol and biofuels.  I’m fine with methanol too, but it’s not as good as ethanol for a variety of reasons.  Not interested in listing them here; people can do there own research to find out why.  The difference is that I can allow room for all, while others here might try to divide and conquer for their particular preference.  The momentum is with ethanol, and will continue being so going forward.

     

    http://www.princeton.edu/oeme/…..ection.pdf

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  86. By rrapier on August 19, 2010 at 2:13 am

    SacE85 said:

    Robert and Ronald, I am not interested in debating you.  I’m just listing facts for others to consider.  It is obvious that we have to agree to disagree.  I totally disagree with some of your thoughts, and agree with a few others.  Yes Robert, for now I do believe you speak out of both sides of your mouth.  In the end, you’re not very favorable towards ethanol, but will say some things that sound favorable to ethanol to cause division.


     

    And there you go again. You hurl accusations, and then say you aren’t interested in debating them. As far as I am concerned, you can believe anything you want. People believe all sorts of things. But if you are going to make accusations, the burden is on you to provide evidence. If you don’t feel like debating, don’t make accusations. You apparently believe that I take time to write essays like this just to throw people off the scent of my hatred for ethanol. Believe it or not, I actually have better things to do than write essays for the purpose of subterfuge.

    RR

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  87. By ronald-steenblik on August 19, 2010 at 4:13 am

    SacE85 said:

    … It is obvious that we have to agree to disagree.  

    It’s nauseating for intelligent people to debate their preferences, and most often just a waste of time. …

    … The momentum is with ethanol, and will continue being so going forward.


     

    OK, I agree to disagree. But what I find interesting is that the defenders of the stats quo government subsidies and mandates for ethanol tend to write on this web site post under pseudonyms, while those who are interested in exploring better policies post under their real names. This leads often to the biofuel boosters attacking the motives and questioning the behavior of the critics, rather than sticking to the issues.

    But to accuse Robert of engaging in “divide and conquer” tactics is hilarious. Nobody needs to do that. Among the people with whom I correspond (or see corresponding) on this issue, I know people who:

    • Are supporters of biofuels, and say they hate any use of petroleum (e.g., the http://www.25×25.org coalition).
    • Are supporters of biofuels, but want free trade in biofuels (e.g., Jeb Bush).
    • Are supporters of biofuels, but endorse “drill baby drill!” — i.e., care mainly about domestic energy self-sufficiency (e.g., some of the people posting comments on the DTN Ethanol Blog).
    • Are supporters of second-generation biofuels, but not of biofuels made from food crops (e.g., the NRDC).
    • As above, but want to see more stress on making the vehicle fleet more fuel efficient (e.g., some of the people backing low-carbon fuel standards)
    • Are against the internal combustion engine (i.e., burning either biofuels or petroleum or even natural gas), and want to see a transition ASAP to electric vehicles, trams and trains, powered by renewable electricity sources.
    • As above, but powered by nuclear power.

    Etc., etc. In short, it is natural that with such high stakes, and people coming to these issues with different perspectives, there will be divisions. The difference, of course, is that the first category (those defending the biofuel subsidies, mandates, and import protection) have been able to form an effective lobby, allied with pre-existing agricultural and agri-business interests, and a regional concentration of politicians, while the rest are more dispersed and fragmented.

    Not sure what you mean, SacE85 by “intelligent people debating preferences”. Seems to me that what Robert is engaging in on this blog is trying to sift the truth from the noise. But if that makes you feel ill, please do us a favour and use the room down the hall. Meanwhile, you might contemplate whether asserting that “The momentum is with ethanol, and will continue being so going forward” isn’t expressing a preference. I would agree that there has been a lot of rigging of the ethanol market, thanks to political momentum (and a large number of Senators representing farm states), but that’s hardly a reason to give up looking for better policies.

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  88. By Kit P on August 19, 2010 at 7:25 am

    John M, when I buy a new car; the first
    thing I check in CONSUMERS REPORTS is reliability and cost of
    repairs. There is no data on BEV for widespread use. This is what
    Rufus was getting at:

     

    “nine year old car with a “Dead”
    battery”

     

    Have you ever looked at efficiency
    curves for motors and batteries under varying load and temperature
    conditions? What is the efficiencies of the conversion of fossil
    fuels to electricity, and transmitting it to your house to charge
    batteries?

     

    Sorry, there is nothing to suggest that
    at this time in the US that BEV will ever get anything but marginally
    better. If we build a 100 new nukes to supply electricity maybe.
    However, look at California where air quality would make the most
    sense for BEV and new nukes are outlawed.

     

    Sam wrote:

     

    “why don’t biofuels stand a chance
    ..”

     

    Right now I am running E10 in my old
    ICE without an expensive capital investment on my part. It is a
    pretty good start at replacing oil.

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  89. By ronald-steenblik on August 19, 2010 at 1:12 pm

    Regarding the very interesting article that SacE85 included the link to: Stern, R.J., “United States cost of military force projection in the Persian Gulf, 1976–2007″, Energy Policy (2010), doi:10.1016/j.enpol.2010.01.013.

    It is a very interesting article, and I do not dispute his estimates. What I do dispute is his assertion that all of the costs of the USA’s military force projection in the Persion Gulf can be related to oil — and, most particularly, U.S. imports of oil.

    For one, there is also the issue of protecting Israel from hostile neighbours, but also terrorists (Stern writes in a footnote: “While some terrorism may be directed against the US in retaliation for its support for Israel, it is assumed here that US force projection in the Persian Gulf does not protect Israel”), and trying to keep Egypt — not a major exporter — from turning to the Communist orbit (prior to 1990), and since then keeping it from turning radical. The military has also always wanted to have places from which it can deploy quickly in the case of aggression from hostile nations in the region. Turkey has been an important aly in that regard, but real U.S. bases are better.
     
    Moreover, expenditures up to the present are sunk costs. No matter what is done to conserve or substitute oil, those costs will not be recovered.
     
    I think it is interesting that Stern concludes with the following:

    Unfortunately, force projection is not a remedy for market power, but a strategy to contend with its consequences.Since market power has never been challenged by any sustained US or importer monopsony policy, the strategy of force projection was bound to fail, as Iran’s emergence as a regional hegemon seems to demonstrate. Treating symptoms with force has thus led to the substantial investmentof CPGfp 1976–2007 E$6.81012, perhaps to little purpose.The path not taken, monopsonist energy policies to improve fuel efficiency, would address the core problem.

    In short, even assuming that the author’s rather strong assumption of allocating most of the expenditure to oil makes sense, he concludes that it was to little avail. Hence it is not an effective, and therefore not an inevitable, adjunct to oil use.
     
    Note that Stern is silent on the question of biofuels, and instead refers to improving fuel efficiency. That’s something that would be good in itself, and substantial strides could be made within ten years, given that highly fuel-efficient vehicles are already being built and sold in Europe. But I doubt very much that the United States acting alone would have much effect on world oil prices. Even if the United States managed to eliminate imports from the Persian Gulf, other countries would buy the stuff, and world prices for petroleum products (and for biofuels, as long as they cannot totally replace petroleum products) will remain high and volatile. Only if the United States could reduce most of its petroleum consumption across the board — i.e., including for heavy industry, plastics, petrochemicals, aviation — would it become immune from the effects of high oil prices.
     
    So, two questions need to be asked when justifying subsidies for alternatives (as opposed to taxes on petroleum products) on the basis of such studies. First, at the margin, will the subsidies really result in less military expenditure? I think not. Second, will they reduce energy prices, or price volatility? Not by very much.

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  90. By Rufus on August 19, 2010 at 1:36 pm

    The question is, Ron: Which do you think will go up in price the most in the coming years, Oil from the Middle East, and/or 3 miles below the surface of the Ocean, or switchgrass grown on unused/marginal land?

    A Hint: The DOD, in its 2010 “Joint Operations Environment” Report states that the world will be 10 Million Barrels/Day “Short” of Oil by 2015.

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  91. By ronald-steenblik on August 20, 2010 at 2:55 am

    Rufus said:

    The question is, Ron: Which do you think will go up in price the most in the coming years, Oil from the Middle East, and/or 3 miles below the surface of the Ocean, or switchgrass grown on unused/marginal land?


    I think that the price of oil will, with fluctuations, on average continue to increase in the future. At what rate I cannot say. I think that the cost of producing biofuels from cellulosic material will gradually decline, but only gradually, as there is only so much that engineers can do to reduce the costs of collecting, storing and processing large amounts of low-energy-density material. That is, unless somebody comes up with a radically different way of transforming cellulosic material into liquid fuels. (I defer to Robert on that.) By the way, I think that we will see a much bigger demand for “drop-in” jet-fuel substitutes than for cellulosic ethanol, especially in countries that are not skewing the market towards road-transport fuels.

    If somebody manages to bring down the cost of producing biofuels from ligno-cellulosic material such that they are cheaper to produce than the market price of petroleum fuels, we will see a run-up in demand, and a run-up in feedstock costs, until the market prices of cellulosic-based fuels equilibrate with the price of their substitute petroleum fuels — i.e., consumers will not see much lower prices at the pump for some time, if ever. Yes, there may be periods in which one fuel or the other is cheaper (because of excess processing or refining capacity), but those periods will not last for long.

    As for “switchgrass grown on unused or marginal land”, the supply of “unused” land is very small (people are misinterpreting the USDA numbers), and the yields that farmers will get from marginal land is likely to be, well, marginal.

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  92. By Rufus on August 20, 2010 at 7:53 am

    No, Ron, that’s not quite how it’ll work. Due to the cost of transporting grass, your cellulosic plants will be fairly small – 10 million to 25 million barrel/yr, and as a result of the model, they will, basically, have “monopolistic” powers when it comes to prices paid for their feedstock. The farmer will pretty much have a choice of sell to the local plant, or let the land go back to what it was doing before. On the other hand, of course, the refinery will have to offer a price that makes it “worthwhile” to the farmer.

    I would imagine that my county has 30% of it’s land lying fallow in grass, bushes, and weeds. I think I live in a pretty typical South Easter U.S. County. 30% of an average county is about 210,000 acres.

    Ms St Univ figures we could average in the range of 15 to 20 tons of Miscanthus/acre off this type of land. If we could get our need for liquidprivate trasnportation fuel down to 400 gal/person we could replace ALL of our imported petroleum used for gasoline with a refinery capacity of about 27 Million Gallons/Yr per county. Figuring 12 ton/acre at 80 gal/ton = 960 we would need to use 28,000 acres of the 700,000 acres in the county, or about 4% of our land area (about 13% of the marginal/unused land available.)

    Also, for every gallon of ethanol produced you have IIRC, after powering your refinery, about 80,000 btus of lignin for use in power generation. 2.16 Trillion btus will heat quite a few houses, I figure. BTW, in some areas you will get double that yield.

    This should be doable with a pump price of about $2.50 (w/o subsidies.) *includes state and federal taxes.* That new Buick Regal will be driving on cellulosic ethanol for less money than gas. Put the same type engine in the new Cruze, and you should be driving for many years to come for about $0.06/Mile.

    This will be really easy when we finally decide to do it.

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  93. By Rufus on August 20, 2010 at 8:05 am

    Ron, you know as well as I do that those consumers on the East Coast have never paid the first dime in secondary tariff for their Brazilian Ethanol. Brazil has never come close to reaching the cap on their “Tariff-Free” Quota.

    The fact is, Brazilian Cane Ethanol costs more on the world market than does American Corn Ethanol, and probably will to the end of time. However, we probably should Outlaw ethanol imports from any country that uses “Slave Labor” in the growing, and processing of the cane – This would, of course, include Brazil Also, as long as the Government of Brazil is buying the bagasse-generated electricity at a premium, we should probably take that into account.

    We probably shouldn’t force our nascent cellulosic industry to compete with slave labor-produced, government subsidized Brazilian ethanol. At least, not for awhile.

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  94. By ronald-steenblik on August 20, 2010 at 8:14 am

    Rufus said:

    No, Ron, that’s not quite how it’ll work. Due to the cost of transporting grass, your cellulosic plants will be fairly small – 10 million to 25 million barrel/yr, and as a result of the model, they will, basically, have “monopolistic” powers when it comes to prices paid for their feedstock. The farmer will pretty much have a choice of sell to the local plant, or let the land go back to what it was doing before. On the other hand, of course, the refinery will have to offer a price that makes it “worthwhile” to the farmer.


    Perhaps, Rufus, but only if the plant were able to manage to sign up farmers under long-term contracts that match the opportunity cost of devoting their land to growing these dedicated fuel crops. Analyses undertaken by economists at Iowa State University suggest that few if any in the Corn Belt would convert to growing switchgrass in an unrigged market. Of course, if the government tips the balance in favor of switchgrass, then anything is possible. But any shareholders in the plant itself would still insist that the resulting biofuel be sold at a price that the market would bear — i.e., not at a cost price if they can fetch a better price.

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  95. By ronald-steenblik on August 20, 2010 at 8:17 am

    I would imagine that my county has 30% of it’s land lying fallow in grass, bushes, and weeds. I think I live in a pretty typical South Easter U.S. County. 30% of an average county is about 210,000 acres.

    I guess we will have to agree to disagree, if you are suggesting a similar percentage applies to the whole of the United States. People don’t leave land fallow for no good reason. Usually there is an explanation — there is a dispute over ownership, they are keeping it open in the expectation that they are going to build something on it, etc. And, of course, leaving land fallow for a season is also a normal agricultural practice.

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  96. By ronald-steenblik on August 20, 2010 at 8:37 am

    Rufus said:

    Ron, you know as well as I do that those consumers on the East Coast have never paid the first dime in secondary tariff for their Brazilian Ethanol. Brazil has never come close to reaching the cap on their “Tariff-Free” Quota.

    The fact is, Brazilian Cane Ethanol costs more on the world market than does American Corn Ethanol, and probably will to the end of time. However, we probably should Outlaw ethanol imports from any country that uses “Slave Labor” in the growing, and processing of the cane – This would, of course, include Brazil Also, as long as the Government of Brazil is buying the bagasse-generated electricity at a premium, we should probably take that into account.

    We probably shouldn’t force our nascent cellulosic industry to compete with slave labor-produced, government subsidized Brazilian ethanol. At least, not for awhile.


    Oh man. Where does one start? You are right: consumers don’t normally pay for imported ethanol that has had to incur a tariff of 2.5% + $0.54/gallon. The United States used to import a lot more ethanol from Brazil when there was a loophole that allowed a drawback on the duty for certain fuels that the importer exported, notably jet fuel. That loophole was closed beginning in October 2008, however, and one can see the effects of that change in the drastically reduced direct imports of ethanol from Brazil since then.

    Look at an International Trade Economics 101 textbook, Rufus: the effect of an import tariff on a product is to raise the domestic price of that product in the country that applies the tariff — whether the country actually imports the product or not (unless the country would be a net exporter without subsidies). Classic example: rice in Japan. If it didn’t, then you and U.S. domestic industry would not be fighting so hard to retain the tariff.

    As for Brazilian ethanol dewatered in the Caribbean and then shipped onwards to the United States (i.e., the volume that comes in under a tariff-free quota), the quota has not been 100% filled, but the volume imported certainly has increased rapidly over the years. See page 6 of this PowerPoint presentation.

    http://www.ethanolsummit.com.b…..292127.pdf

    It is, of course, not cost-free to process Brazilian ethanol through the Caribbean. Additional costs are incurred through extra handling, and the need for smaller ships, and that is passed on to U.S. importers through higher prices. Numerous articles have pointed out the inefficiencies inherent in this arrangement.

    Rufus, please tell us what percentage of Brazilian ethanol is produced using “slave labor”. To the extent it may be a problem, that can be avoided through certification of suppliers.

    As for Brazilian subsidies that benefit exports, do you have an estimate of what they are and how much they reduce the price of Brazilian ethanol? The normal response to deal with a subsidizing competitor is to take them to the WTO or to impose a countervailing duty on their exports, not a general tariff on all imports (or at least on all imports not covered by the tariff-rate quota). So, why hasn’t the U.S. industry filed a complaint?

    Yet, you then say, “The fact is, Brazilian cane ethanol costs more on the world market than does American corn ethanol, and probably will to the end of time.” If you really believe that, then what’s the problem with eliminating the tariff? But I suspect that you do remember not too long ago when that was not the case, and also know that there is a very strong chance that there will be periods — perhaps long periods — when the relative prices of sugar and corn are such that sugar-cane ethanol becomes cheaper to ship to U.S. seabord than Midwest coarn-derived ethanol.

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  97. By Kit P on August 20, 2010 at 10:43 am

    “Slave Labor”

     

    Well Rufus you certainly a way of
    cutting through the the inside the beltway rhetoric. I am not the
    least bit confused why I support American farmers producing E10 for
    me to buy on the east coast.

     

    that can be avoided through
    certification of suppliers

     

    Sounds like a job for Ron.

     

    Next time you peer review documents for
    Geenpeace you might want to add a definitions section. I am thinking
    the average college educated engineer in the energy field would think
    you are trying to mislead people.

     

    It reminds me of the amusing
    commercial, “Home made, not just made in your home!”

     

    Certainly some issue are complex but streching the meaning of words to the point that the words have only emosional value indicates the absence of a systematic approach find good solutions.

    If the goal is to increase domestic
    production of transportation fuel from biomass, the policy has been
    very successful.

     

    On one hand you have strong evidence on
    the other you have weak misleading evidence. Maybe I should listen
    to inside the beltway people who do not produce anything complaining
    lobbying by producers.

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  98. By Rufus on August 20, 2010 at 10:50 am

    Ron, there is a very good reason so much land is lying fallow. Our commodity prices are so low that only the very best land is economic to farm. We probably have 200,000 + acres in my little old county, alone, that could raise 8 to 10 tons of miscanthus, but just won’t raise enough corn, beans, or cotton to make it worthwhile. Those guys up in Iowa, Illinois, and Nebraska are knocking out 240 bu of corn/acre, routinely. It takes the same inputs down here to make 100 on a lot of this land. That just won’t work.

    BUT, it Will work for Switchgrass, and Miscanthus. No irrigation, and after the first year, no herbicides, and after the first two years, no, or very little, pk. After the first year, no nitrogen. It’s those deep roots. They go down and get what they need. And, of course, you go years w/o replanting. Plus, they fix carbon.

    They like hot weather, and you can’t flood’em out, and they can handle drought extremely well (it’s those deep roots, remember?)

    As far as the tariff goes, I’m, actually, pretty agnostic about it, as long as we take steps to protect a cellulosic industry that’s trying to get started. For instance, as long as we keep the $0.56/gal cellulosic “producers” credit I could care less about the tariff. I’d be more than happy to see it go away when the “Blenders” credit goes away. And, I Do expect the blenders credit to fade away come Jan 1. The Obama team does Not like ethanol, and in this political climate I can’t see any way the blenders credit gets extended.

    Ron, the fact is, the anti-ethanol brigade is “screwed.” The Buick Regal has put the finishing touches on the job. That, and Novozymes, and Dupont-Danisco bringing the cost of enzymes down to $0.50 per gallon of cellulosic ethanol. You can maintain “hope” as long as the price of gasoline stays below $2.75/gal, but it’s a false hope.

    The “Economics” will decide in the end, and the “Economics” aren’t liking the ethanol-deranged very much at this point.

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  99. By ronald-steenblik on August 20, 2010 at 12:46 pm

     

    For instance, as long as we keep the $0.56/gal cellulosic “producers” credit I could care less about the tariff.

    The cellulosic producer’s credit is $1.01 per gallon — minus any VEETC or other subsidy to ethanol generally. 

    Ron, the fact is, the anti-ethanol brigade is “screwed.” The Buick Regal has put the finishing touches on the job. That, and Novozymes, and Dupont-Danisco bringing the cost of enzymes down to $0.50 per gallon of cellulosic ethanol.

    Again, you conflate criticism of over-optimism about cellulosic ethanol, or crticism of support policies for ethanol, as coming from an “anti-ethanol” brigade. Robert Rapier is not “anti-ethanol”; I am not “anti-ethanol”; in fact I can’t think of anybody I know who is “anti-ethanol”. So, I am happy to see a U.S. company come out with a more efficient FFV than the gas hogs that currently comprise 99% of the fleet. But it is not going to be a game-changer overnight.

     

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  100. By Rufus on August 20, 2010 at 1:48 pm

    You’re right about the $1.01. I’m just used to subtracting the blenders credit; but, of course, if there were no blenders credit it would be $1.01. That’s probably too much. An amount that big would, almost, make it “too” easy/encourage sloppiness.

    Well, I’ll take your word for it, Ron; but I’ve never read anything you wrote that didn’t appear to be an attempt to “take apart” the industry. I’m just being a little “triumphalist” (a character flaw, for sure) in that I see you getting most all of the things you’ve been lobbying for, and it not making much difference.

    Interesting world, eh?

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  101. By fred-schumacher on August 20, 2010 at 10:44 pm

    Most petroleum used in the ethanol producing Upper Midwest comes
    from the Northern Plains: North Dakota, Montana, Alberta. If ethanol
    replaces that oil, then that Northern Plains oil will have to be moved farther east or west.

    Rather than going straight to E85, encouraging the use of
    a lower blend somewhat higher than E10 would be more advantageous. The
    University of North Dakota and Minnesota State University, Mankato
    researched the use of E20 and E30 in unmodified 2008 vehicles and
    discovered a synergistic effect that results in equal or slightly
    better fuel economy than straight gasoline. This effect does not appear
    at E10 or E85. For a press release, see:
    https://www.mnsu.edu/news/read/?id=old-1201016489&paper=topstories  
    For a pdf of the study, see:
    http://www.rhapsodyingreen.com….._study.pdf

    The
    Minnesota State Legislature mandated going to 20% total ethanol content
    by 2013. It doesn’t look possible to achieve this through the use of
    E85, so the state is going through the federal permitting process to
    move from E10 to E20. See: 
    http://www.leg.state.mn.us/doc…..090187.pdf

    The
    biggest problem I see with Mr. Rapier’s proposal is that it sets up a
    regional standard different from the rest of the nation’s, somewhat
    like California’s state mandated pollution standards, making it more
    difficult for manufacturers to optimize their vehicles for fuel
    efficiency.

    Since the topic has also moved on to cellulosic ethanol and the growing of biomass crops, let me note here that there is a general misunderstanding of the farmer decision making process. Farmers do not grow food to feed the world. Farmers produce agricultural commodities, food/fiber/energy, to support their own families. If biomass crops become more profitable than traditional cereal grains, there will be a mass movement over to those crops, and prime land, not just marginal land, will be put into biomass. The greatest impediment to such a movement is the potential loss of “Base Acres.” Since biomass is a “non-Program” crop not protected by the USDA safety net, any planting into non-Program crops would be deducted from a farm’s Base Acres. USDA payments are based on Base Acres.

    As regards cellulosic processing plants and the movement of bulky material, I would expect farmers to preprocess the biomass for easier transport. I would also expect farmer-owned co-operatives to take the lead in developing cellulosic processing plants. That was the pattern in the past with corn ethanol and other value added processing.

    Since I am a first time poster, for disclosure
    reasons, I will state here that I always post under my own name,
    written in lower case, and that I am a retired North Dakota native
    grass seed producer (green needlegrass, western wheatgrass,
    switchgrass, big blue stem, sideoats gramma, pubescent wheatgrass) and
    am presently living in Burnsville, MN, where I am a full-time nanny for
    my grandchildren. My wife is a sociology professor at Minnesota State
    University Mankato, which is how I know Dr. Bruce Jones, one of the
    primary authors of the optimal ethanol blend study.

    fred schumacher

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  102. By Rufus on August 21, 2010 at 12:18 am

    Fred, I’m under the impression that switchgrass yields are unlikely to be large enough in the Midwest to lure farmers away from corn (at least, on their better land.) Is that your opinion?

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  103. By rrapier on August 21, 2010 at 4:05 am

    fred schumacher said:

    The biggest problem I see with Mr. Rapier’s proposal is that it sets up a regional standard different from the rest of the nation’s, somewhat like California’s state mandated pollution standards, making it more difficult for manufacturers to optimize their vehicles for fuel efficiency.

    fred schumacher


     

    Hi Fred, and welcome.

    It wouldn’t be a standard. It would be incentives that would result in more ethanol being used closer to the source. Let’s face it, if ethanol is to be a really viable alternative to gasoline, it should be able to completely take over the fuel market in places like Iowa. However, it may take some incentives to get the infrastructure in place.

    On the study you cited, NREL was unable to replicate those results:

    Effects of Intermediate Ethanol Blends on Legacy Vehicles and Small Non-Road Engines

    The key findings from the NREL test:

    • All 16 vehicles exhibited a loss in fuel economy commensurate with the energy density of the fuel.*

    • Limited evaluations of fuel with as much as 30% ethanol were conducted, and the reduction in miles per gallon continued as a linear trend with increasing ethanol content.

    *This result was expected because ethanol has about 67% of the energy density of gasoline on a volumetric basis.

    RR

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  104. By Kit P on August 21, 2010 at 12:45 pm

    “if ethanol is to be a really viable
    alternative to gasoline, it should be able to completely take over
    the fuel market in places like Iowa.”

     

    No if about it, ethanol has been show
    to be a viable alternative to gasoline. Just like wind and solar has
    been shown to be a viable method of producing electricity. The next
    part of the process is to determine what share of the mix alternative
    can provide.

     

    Why should it should be able to
    completely take over the fuel market in places like Iowa?

     

    I can not think of any reason. Maybe
    RR intended to use the would ‘could’ instead of ‘should’.

     

    “On the study you cited, NREL was
    unable to replicate those results:”

     

    That was not the purpose of NREL study.

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  105. By Rufus on August 21, 2010 at 2:04 pm

    Only three, or four percent of the cars in the Midwest are flexfuel. About 15% of the cars built this year will be flexfuel. I don’t see how E85 could “take over” a region under this set of circumstances.

    If we, as a country, really wanted to promote E85 we would probably mandate that all cars, and light trucks be FFV, and find a simple way to reward retailers for selling more E85, while finding a way to encourage consumers to use it.

    Right now, I don’t think much of that is going to happen. The Obama White House does NOT like Biofuels, at all. They have shown, by their actions, that this is the case. I can’t imagine that they will change their minds. We’ll just stumble on for awhile. Until something comes along that changes the equation.

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  106. By Kit P on August 21, 2010 at 4:05 pm

    The Obama White House does NOT like
    Biofuels

     

    I do not think that is true, I think it
    is more about inexperience of getting this done. I call it the
    diether factor. Government likes to study things until they die on
    the vine. Renewable energy is a business and business hates
    uncertainty.

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  107. By Francis Patrick on August 21, 2010 at 4:46 pm

    Some comments on the comments:

    1. Slave labor – The American Civil War wasn’t fought over slavery it was fought over the “Economics of Slavery”. The Northern Industrialists couldn’t compete with the Slave labor of the Southern Elite. Same for Brazil and it’s ethanol industry. American corn farmers can’t compete with Brazilian Slave labor, Japan can’t compete with Chinese Slave labor and the American service industry can’t compete with Indian Slave labor.
    2. Methanol eats internal engine components. Ethanol on the other hand is a much more benign fuel and doesn’t harm internal engine parts. I use E-85 in non flex fuel vehicles with no adverse effects. Methanol like gasoline is highly toxic. Ethanol is environmentally benign.
    3. If tariffs are dropped on Brazilian ethanol, corn ethanol will be unable to compete and Brazil will expand production to take up the slack in the American market. The expansion will take place in the rain forest. So in other words Corn ethanol is the fire wall preventing the rain forest from being cleared for sugar cane fields.
    4. The American consumer doesn’t need imported ethanol, what the American consumer needs is JOBS, JOBS, JOBS. Substituting domestic ethanol for imported ethanol, well we might as well continue using imported oil.

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  108. By rrapier on August 21, 2010 at 5:12 pm

    Francis Patrick said:

    Some comments on the comments:

     


     

    Francis,

    These points were all covered in great detail in the essay Methanol Versus Ethanol, and in the comments following the essay. Briefly:

    1. It isn’t slave labor that is the primary difference between sugarcane and corn ethanol. It is the fact that sugarcane ethanol has free fuel for the process in the form of bagasse.

    2. The difference between the corrosion characteristics of ethanol and methanol is less than that between gasoline and ethanol. But by replacing certain parts, it is a manageable issue.

    3. Part of that may be right, but sugarcane isn’t grown near the rain forests.

    4. I am not proposing to substitute domestic for imported ethanol. I am proposing something that would triple the market for domestic ethanol.

    RR

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  109. By Rufus on August 21, 2010 at 5:46 pm

    First, Corn ethanol costs less to produce than Brazilian “Cane” ethanol. That’s why it sells for less on the world market. Part of it is DDGS for livestock feed are more valuable than lignin (bagasse) for power generation.

    Let’s don’t get too carried away. There are 150 Million Acres lying fallow in the Cerrado. If the Rain Forest is cut it’s for the logs (which are incredibly valuable,) not to make even more acres available for agriculture.

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  110. By carbonbridge on August 21, 2010 at 8:38 pm

    Rufus said:

    Only three, or four percent of the cars in the Midwest are flexfuel. We’ll just stumble on for awhile. Until something comes along that changes the equation.


     

    Rufus:  Quick comment. 

    I’m wondering IF this is your blog? 

    You comment here more than RR does who writes these essays here.  A few days ago you asked me to stop heckling you. 

    OK. 

    Please start your own corn ethanol blog somewhere and post an URL here.  Thank you.

     

    Dear Francis & Fred:  Welcome to these open, public discussions and thank you for providing your opinions using your own names instead of another alias.  I’m having some discussions offline with other engineering folks who contribute here.  And we are aware that for everyone who posts any opinion, there are likely 100 lurkers/readers who don’t offer a word nor ask a question.

     

    –Mark Radosevich

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  111. By Wendell Mercantile on August 21, 2010 at 9:02 pm

    Why should it should be able to completely take over the fuel market in places like Iowa?

    Because in Iowa there is a corn ethanol distillery about every 30 miles, and the logistics and cost of transporting the corn and the ethanol made from it can’t be much easier or lower. If the abundance of corn ethanol in Iowa can’t drive the price low enough to make everyone to want to use it, in which of the other 49 states would that ever happen?

    Out of pure Hawkeye chauvinism alone, everyone in Iowa should want to use E85 to support their neighbors and their ag economy. I bet almost everyone in Iowa has relative who is a corn farmer or at least knows a corn farmer with less than three degrees of separation. I bet almost every bank in Iowa has a loan out to a corn farmer, ag implement dealer, or to a local ethanol distillery.

    If any state in this country should be self-sufficient in bio-fuels, it should be Iowa. But they aren’t — they’re not even close. The fact that not even Iowa is self-sufficient in bio-fuels should give us all all big hint about bio-fuels.

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  112. By rrapier on August 21, 2010 at 9:39 pm

    Kit P said:

    Why should it should be able to

    completely take over the fuel market in places like Iowa?

     


     

    I missed this initially, but Wendell answered it quite well. If ethanol is a real alternative to gasoline, in Iowa it should be able to dominate the marketplace. All gasoline must be shipped in, and ethanol is made locally. It should have every possible advantage. Why shouldn’t it take over the marketplace if it is a real alternative?

     

    “On the study you cited, NREL was

    unable to replicate those results:”

     

    That was not the purpose of NREL study.

    The purpose of the study was to investigate intermediate blends, just like those reported on in the study Fred cited. They did not find the same sort of sweet spot that the other study did, hence the results are not corroborated. Instead, they found exactly what you would expect: A loss of fuel economy that was linear with the amount of ethanol. 

    As I said at the time, the University of North Dakota/Minnesota State University study had what looked like classic outliers. My opinion was that it was interesting, but would need to be corroborated. It has not been. More on that here:

    http://www.consumerenergyrepor…..end-falls/

    RR

     

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  113. By Rufus on August 22, 2010 at 1:03 am

    Carbonbridge, why would you censor my thought. Are you afraid yours can’t compete?

    How could E85 “Dominate” the Iowa market when only four, or five percent of the cars, there, are FlexFuel?

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  114. By rrapier on August 22, 2010 at 2:44 am

    How could E85 “Dominate” the Iowa market when only four, or five percent of the cars, there, are FlexFuel?

    Well, that’s part of what I would propose to fix. More FlexFuels, more pumps. Starting in Iowa.

    RR

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  115. By ronald-steenblik on August 22, 2010 at 3:34 am

     

    Francis Patrick writes:

    3. If tariffs are dropped on Brazilian ethanol, corn ethanol will be unable to compete and Brazil will expand production to take up the slack in the American market. …

    I doubt it. Are people forgetting geography? Internal transport adds considerably to costs. Along the major eastern and western coastal conurbations, transport costs would work against U.S.-made corn ethanol. In the heartland, however, transport costs would work against imported ethanol. An economically rational market would see the majority of U.S.-produced corn ethanol consumed in the Midwest, and imported ethanol used in the coastal conurbations.

    3. … So in other words Corn ethanol is the fire wall preventing the rain forest from being cleared for sugar cane fields.

    Rufus is right: cane doesn’t grow well in the Amazon (though other crops do), and the main economic incentive to clear land there (at least initially) is to harvest its logs. But even if one believes that to be true, a general (i.e., most-favored nation) tariff is not the standard trade instrument that countries are supposed to use. As I have pointed out before, when countries are concerned about particular exporters, they use targetted measures — e.g., a countervailing duty or an anti-dumping duty — not a general tariff that applies to all other exporters as well. Other countries, such as Switzerland (and soon, the EU), by the way, have created “sustainability standards” that ban biofuels made from crops grown on formerly forested land.

    4. The American consumer doesn’t need imported ethanol, what the American consumer needs is JOBS, JOBS, JOBS. …

    That is to say, an import substitution policy, like Latin American countries tried and abandoned? Autarky, like North Korea? Jobs are needed, certainly. But normally subsidizing industries to create jobs only helps the region in which the industry is concentrated, generally at the expense of jobs elsewhere in the economy. Raising tariffs to protect jobs has been tried before. In 1930 the U.S. Congress passed the Tariff Act (P.L. 71-361), also called the Hawley–Smoot Tariff Act, which raised U.S. tariffs on over 20,000 imported goods to record levels. Other countries followed in retaliation. The Great Depression ensued, and then World War II.

    4. … Substituting domestic ethanol for imported ethanol, well we might as well continue using imported oil.

    First of all, this is not a zero-sum game. Eliminating import tariffs on ethanol would increase the supply available (in the parts of the United States distant from the Midwest) at a price competitive with gasoline. Overall, national consumption of ethanol would probably increase. And if importing oil means supporting terrorists (as some people argue), doesn’t importing ethanol from a friendly country — one that is a potentially important market for U.S. exports of manufactured goods — have some merit?

    ————

    As for Rufus, I sense a greater pragmatism from him these days, and much less troll-like behavior. I’m even finding myself in agreement with him from time to time. Proof that if enough people keep up a civil discourse, others will eventually adopt the same approach?

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  116. By Rufus on August 22, 2010 at 3:44 am

    You could do it that way, I suppose. I think it would be a PR mess. The thing is, only a small percentage of the people in Iowa live on farms. Of course, it’s true that the slightly larger percentage that live in small, rural towns wouldn’t object too much, but Most of the people of Iowa live in Large towns, and Cities.

    I think we lose sight of the fact that an inhabitant of Des Moines probably has more thought processes in common with a denizon of New York than with a citizen of . . . . . . . . . (insert name of small Iowa town, here.)

    I’m not saying it’s a “terrible idea,” or that it couldn’t work, but it doesn’t sound, to me, at least, like something that’s going to get done.

    An example would be: The pro-ethanol legislators in Iowa haven’t even managed to get an E10 mandate through the statehouse (the people in Des Moines say, “we would rather have a choice.) And, who could blame them? They Are Americans, right?

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  117. By Rufus on August 22, 2010 at 4:07 am

    And, another thing; let’s be honest about this, those early “flexfuels” Were, basically, CAFE dodges. I don’t think that anybody that built them actually thought that hardly anyone would be using ethanol in them. They set the computer programs so that they would have fair-to-good “driveability,” just in case someone did put some E10 in them, and didn’t worry too much about fuel mileage. That, actually, started to change, I think, around 2007, 2008.

    Now, we’re starting to see what they can “Really” do. I keep harping on the Buick Regal, but it IS an important milestone. It IS the first major production car to spend some extra money to be a True Flexfuel. Other manufacturers will have to follow, and then, of course, GM will have to adapt the technology to other models.

    It is a “game-changer,” but Wendell is right, also, when he says that it will take several years for it to start making a real difference.

    Winston Churchill said, “The Americans Always get it right – when they’ve exhausted All other possibilities.”

    Smart man, Ol’ Winston.

    He understood us better than most.

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  118. By ronald-steenblik on August 22, 2010 at 10:33 am

    [L]et’s be honest about this, those early “flexfuels” Were, basically, CAFE dodges. … I keep harping on the Buick Regal, but it IS an important milestone. It IS the first major production car to spend some extra money to be a True Flexfuel. Other manufacturers will have to follow, and then, of course, GM will have to adapt the technology to other models.

    Indeed, Rufus, the first U.S. FFVs were encouraged by the “dual-fuel” loophole in the CAFE standards, which meant that virtually all the FFVs that were built had 4.0 L or larger engines, because these were the types of vehicles that earned the Big 3 the biggest profits, and also for which the big % reduction in their assessed fuel economy had the greatest impact.

    What is depressing in any discussion of “breakthroughs” in U.S. automaker technologies is that many if not most of these breakthroughs have already taken place elsewhere, earlier, and often by European or Brazilian subsidiaries of the same companies (GM and Ford), in addition to Citröen, Fiat, Honda, Mitsubishi,  Nissan, Peugeot, Renault, Toyota, and Volkswagen. Any web search will quickly reveal that the FFVs built in Brazil have been modest-sized cars from the start.

    It is not a question of know-how, but of the incentive structure — among which, high taxes on gasoline – which is what some of us here keep trying to stress.

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  119. By Wendell Mercantile on August 22, 2010 at 11:24 am

    How could E85 “Dominate” the Iowa market when only four, or five percent of the cars, there, are FlexFuel?

    Rufus~

    Corn is such an embedded part of life in Iowa, and so central to the Iowa economy, that everyone in the state should have by now realized using E85 and burning corn ethanol is to their collective advantage. (Have you ever driven I-80 across Iowa? It is literally corn for mile after mile, with virtually everyone in Iowa has some association with corn — even the city-folk.) Flex-fuel cars should be flying off the showroom floors there. And Iowa farmers should be demanding that all their ag equipment run on corn ethanol.

    Yet none of that has happened — not even in Iowa where the conditions for running a corn ethanol economy are the best in the CONUS. Why?

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  120. By Kit P on August 22, 2010 at 11:27 am

    “but Wendell answered it quite well.
    If ethanol is a real alternative to gasoline, in Iowa it should be
    able to dominate the marketplace.”

    Arm waving is not the same as a good
    answer. Because we import oil large amounts of oil, transportation
    fuel is a national issue.

     

    I am very skeptical of those who tell
    people distant from where they live how they should do things. It
    has been a long time since I have lived in Iowa. I have only visited
    Hawaii for short time but they are fundamentally different places.

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  121. By Kit P on August 22, 2010 at 11:37 am

    but of the incentive structure — among which, high taxes on gasoline
    – which is what some of us here keep trying to stress.

     

    That is becsue Ron is a rich guy who lives in DC and derives a livelihood from burdensome taxes on the poor. 

     

    Rationing the amount of energy rich people use would be a very effective policy at reducing energy demand but notice how that never comes up as a solution.

     

    How about a mandate that every member of congress has to buy a BEV. 

     

    Hurt the little guy and then blame it on ‘big’ whatever.  

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  122. By ronald-steenblik on August 22, 2010 at 1:05 pm

    Kit P said:

    That is becsue Ron is a rich guy who lives in DC and derives a livelihood from burdensome taxes on the poor.


    Wrong on every count, Kit. But, of course, given that you are writing anonymously for all we know you could be the CEO of Exxon.

    From http://subsidyscope.com/transp…..s/funding/:

    Using Federal Highway Administration statistics, Subsidyscope has calculated that in 2007, 51 percent of the nation’s $193 billion set aside for highway construction and maintenance was generated through user fees—down from 10 years earlier when user fees made up 61 percent of total spending on roads. The rest came from other sources, including revenue generated by income [including the income of people who don't even own cars], sales and property taxes, as well as bond issues.

    Read those statistics again: feul-excise taxes covered a mere half of the actual cost of highway construction and maintenance. We’re not even talking here about pollution or carbon taxes. I agree that raising taxes on gasoline and diesel should be done in a way that does not disproportionately hurt the poor. But that can be done by adjusting other taxes, such as income taxes.

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  123. By rrapier on August 22, 2010 at 2:55 pm

    Kit P said:

    “but Wendell answered it quite well.

    If ethanol is a real alternative to gasoline, in Iowa it should be

    able to dominate the marketplace.”

    Arm waving is not the same as a good answer. Because we import oil large amounts of oil, transportation fuel is a national issue.


     

    A non-answer is also not a good answer. Let me help you connect the dots. The national issue is impacted by shipping ethanol out of Iowa. It makes the country more dependent upon petroleum than if we used it in Iowa.

    I am very skeptical of those who tell people distant from where they live how they should do things. It has been a long time since I have lived in Iowa. I have only visited Hawaii for short time but they are fundamentally different places.

    Maybe if you were less skeptical of people and stuck to the ideas instead, people wouldn’t have some many problems with you. Your ad hominem arguments are a very common logical fallacy, but one that you need to stop.

    Iowa and Hawaii have something very much in common. Both have very rich natural resources and the capacity to produce a lot of their own fuel. Yet both are heavily dependent upon imported fuel. You may have also noticed that while I have made this kind of argument for years, lately POET has gotten on board with shifting the subsidies toward E85 infrastructure.

    RR

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  124. By rrapier on August 22, 2010 at 3:09 pm

    Ronald Steenblik said:

    This is the one that raises lots of questions. In your article, Robert,

    you suggest that you would only increase the VEETC to $0.50 per gallon.

    You then add, in your comments on page 2, that “it might actually take

    double the current subsidy. If I proposed something like that, I would

    propose it with a phase-out scheduled. $0.90 for the first 2-3 years,

    then $0.60, etc.”


     

    Ron, I have owed you a response from way back. I think you fundamentally agree that if we are to produce ethanol, it makes the most sense to use it as locally as possible; or rather as efficiently as possible (port to port is pretty efficient transport). The question then becomes how to encourage this.

    One of the things I have said for years is that ethanol may not make sense as a national energy policy, but it may be great for places like Iowa that produce ethanol. In fact, I made that exact comment at the ASPO conference in 2008. But for places like Iowa, there aren’t enough E85 vehicles on the road and there isn’t enough infrastructure. The current price spread in Iowa between gasoline and E85 is 30%. If that can be maintained (a big if) then that would likely be incentive enough for E85 growth. But the risk factor will still slow acceptance, so I would like to see some of the ethanol incentives redirected toward building out E85 infrastructure.

    How that is done is an open question. I think an E85 specific subsidy would certainly do the trick. But presuming that you are in agreement with the concept how would you go about incentivizing it? Bear in mind that the ethanol is going to be made; it’s just a question of whether we inefficiently ship it to the coast or use it locally. I think if we do nothing, we will end up with an E12 or E15 standard which has many problematic issues.

    RR

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  125. By savro on August 22, 2010 at 3:40 pm

    Robert Rapier said:

     

    One of the things I have said for years is that ethanol may not make sense as a national energy policy, but it may be great for places like Iowa that produce ethanol. In fact, I made that exact comment at the ASPO conference in 2008. But for places like Iowa, there aren’t enough E85 vehicles on the road and there isn’t enough infrastructure. The current price spread in Iowa between gasoline and E85 is 30%. If that can be maintained (a big if) then that would likely be incentive enough for E85 growth. But the risk factor will still slow acceptance, so I would like to see some of the ethanol incentives redirected toward building out E85 infrastructure.

    Robert, the lack of E85 vehicles on the road is a significant obstacle to your goal of using the ethanol locally and making Iowa less dependent on oil imports. How do you propose to fix this problem?
     

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  126. By rrapier on August 22, 2010 at 3:49 pm

    Samuel R. Avro said:

    Robert Rapier said:

     

    One of the things I have said for years is that ethanol may not make sense as a national energy policy, but it may be great for places like Iowa that produce ethanol. In fact, I made that exact comment at the ASPO conference in 2008. But for places like Iowa, there aren’t enough E85 vehicles on the road and there isn’t enough infrastructure. The current price spread in Iowa between gasoline and E85 is 30%. If that can be maintained (a big if) then that would likely be incentive enough for E85 growth. But the risk factor will still slow acceptance, so I would like to see some of the ethanol incentives redirected toward building out E85 infrastructure.

    Robert, the lack of E85 vehicles on the road is a significant obstacle to your goal of using the ethanol locally and making Iowa less dependent on oil imports. How do you propose to fix this problem?


     

    Was thinking about this over the past couple of days. Will address it in my “E85 Case Study: Iowa” post. There are several approaches one could take, but the first thing is to identify how many are actually out there.

    RR

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  127. By Kit P on August 22, 2010 at 3:51 pm

    “Wrong on every count”

     

    Wrong how, I might come to the
    conclusion that I hit the nail on the head when non-anonymous posters
    do not actually tell me how I am wrong.

     

    Does anyone think that taxes on food
    and energy are not burdensome on the poor?

     

    “We’re not even talking here about
    pollution or carbon taxes.”

     

    My mistake then but Ron did not provide
    a context for raising taxes. And how is paying for road repair
    related to ethanol?

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  128. By Rufus on August 22, 2010 at 3:52 pm

    BTW, I doubt very much that the spread is “really” 30% in Iowa. No knock on Dan’s site, he’s done a wonderful job of compiling and disseminating information of E85, and availability, etc, but you do have to take into consideration that those prices are from, basically, a small group of commenters posting prices from their favorite stations (ie those with the best prices.)

    The Detroit 3 are still on course to achieve their goal of having 50% of their new vehicle sales be flexfuel by 2012. Considering that they have about 1/2 the market, that means that about 25% of new vehicles sold in 2012 will be flexfuel. Around 3 to 3.5 Million. This is, also, about the same time when many of the “peak oilers” expect the shinola to really start impacting the rotating blades.

    This is, also, about the time that we will start getting (hopefully) full “proof-of-concept” from Poet, Genera, Fiberight, Abengoa, and a few others on “Cellulosic.” This is, probably, about the time that more people will start looking at My idea of smaller cellulosic refineries selling into local markets, starting, primarily, in the Southeast. We’ll see.

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  129. By ronald-steenblik on August 22, 2010 at 4:02 pm

    Thanks for the response, Robert. I agree that agree that, in an economically rational market, there would be an inverse relationship between market share and distance from point of production. But, of course, for something like ethanol, there is a limit on how much can be consumed locally, which depends on not just relative prices but also the technical ability to use the fuel.

    You write, “The question then becomes how to encourage this.” No, I don’t think that is the question. The question is how to stop encouraging more production than the market can absorb.

    Where I disagree strongly is supporting a specific subsidy that is proportional to production or consumption. (“I think an E85 specific subsidy would certainly do the trick.”) Such subsidies tend to create subsidy-dependent patterns of production and consumption, and to the extent that they create rents in the market they get capitalized into the least mobile factors of production — in this case, the value of arable land. (Just look at Iowa land prices in the period 2004-2008: http://www.extension.iastate.e…../c2-70.pdf. In lock step with the increases in the price of corn, farmland prices increased year-on-year by 15%, 11%, 10%, 22% and 14%. Such asset-value inflaction benefits owners of land, but hardly anybody else. And while the media tends to ignore increases in farm land values, it is standard fare to report on declines in farmland value, and consequent bank foreclosures. Hence the tendency for politicians to keep the subsidies in place.)

    Subsidies for capital investments, on the other hand, though they may (not always) be a waste of taxpayer money, can at least be stopped without creating any losers.

    I come back to one of my later comments: if there is a regional benefit to ethanol production and consumption, then it should be in the interest of Midwest states to finance E85 or blender pumps. There is much less of a compelling reason for federal funds to be used.

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  130. By Rufus on August 22, 2010 at 6:17 pm

    Ron, you wrote, “The question is how to stop encouraging more production than the market can absorb.”

    I’ve never read where you wrote anything decrying the “encouragement” of more production from the Nigerian Delta, or the Tar Sands, or the Orinocco Belt. I haven’t read anything you’ve written bemoaning the “encouragement” of drilling 3 miles down in the Gulf of Mexico, or in the Bolivian Rain Forest.

    Ron, you’ve gotten a lot “slicker,” but it still reads like the same old “Pro-Oil, Anti-Ethanol” screed, to me.

    BTW, it still sounds better to me to ship ethanol from Ohio to Connecticut than to load Saudi Oil on Greek tankers, and ship it around the Horn of Africa, and halfway around the world to New Jersey for refining, prior to shipping up the East Coast.

    Not to mention the fact that the citizens of New Haven don’t have to pay taxes to send the Marines to Ohio to “protect” the ethanol from renegade Buckeyes, nor the Seventh Fleet to protect the Ohio River.

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  131. By rrapier on August 22, 2010 at 6:30 pm

    Kit P said:

    “Wrong on every count”

     

    Wrong how, I might come to the conclusion that I hit the nail on the head when non-anonymous posters do not actually tell me how I am wrong.


     

    He did tell you. Wrong on all counts. He doesn’t live in DC, isn’t rich (on this I have no idea) and doesn’t derive his income from taxes. So it was just standard fare from you: Speaking off the top of your head, being wrong, having that pointed out, and then denying you were wrong. Such a waste of people’s time.

    Does anyone think that taxes on food and energy are not burdensome on the poor?

    I could certainly put an energy tax in place that wouldn’t be burdensome on the poor. In fact, I have proposed one many times that would be no burden on them whatsoever. Of course your kneejerk response has always been to reply — with zero merit — “that would be burdensome on the poor.”

    RR

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  132. By ronald-steenblik on August 22, 2010 at 7:07 pm

    I’ve never read where you wrote anything decrying the “encouragement” of more production from the Nigerian Delta, or the Tar Sands, or the Orinocco Belt. I haven’t read anything you’ve written bemoaning the “encouragement” of drilling 3 miles down in the Gulf of Mexico, or in the Bolivian Rain Forest. Ron, you’ve gotten a lot “slicker,” but it still reads like the same old “Pro-Oil, Anti-Ethanol” screed, to me.

    OK, I oppose the “encouragement” (i.e., artiificial stimulation through subsidies) of oil production from the river deltas, tar sands, rain forests, in deep waters, or in fact anywhere.

    Happy?

    For your information, I am currently trying to compile a comprehensive inventory of subsidies to fossil fuels in various countries. (A big task.)

    How you equate comments on what kinds of biofuel policies I think are inefficient with being “pro oil” I guess I’ll never comprehend, except that I gather it has something to do with the kind of attitude expressed by the phrase “Either you’re wit’ us or agin’ us!”

    Now, can we get back to the subject at hand — i.e., Paul’s and Robert’s proposals?

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  133. By rrapier on August 22, 2010 at 8:52 pm

    Ronald Steenblik said:

    Now, can we get back to the subject at hand — i.e., Paul’s and Robert’s proposals?


     

    I suppose the first thing one has to ask, Ron, is what are we trying to accomplish. For me, I want to see mitigation solutions in place for peak oil. So when I look at our biofuel policies, the first thing I always ask is “Can this be a viable option if fossil fuel supplies are depleting and there is stiff upward pressure on prices?” I think corn ethanol in Iowa could be viable, but I doubt corn ethanol for California will be. I don’t believe the energy density will warrant shipping ethanol halfway across the country for California’s cars.

    Like you, I don’t want to encourage overproduction of anything. I am also seriously concerned about taking care of the topsoil for future generations. So the risk there of encouraging homegrown ethanol to remain in Iowa is that it may also encourage production of corn on marginal soil. What I don’t know is how much corn ethanol could actually be grown in a sustainable fashion. Many would argue that we are already past that point. I don’t know. I am as concerned as anyone about issues like the dead zone in the Gulf, but there is no free lunch. There are always trade-offs.

    So, lots of open questions and challenges, but I do believe we will produce (and continue to produce) 15 billion gallons of ethanol in the next few years. It will be blended into the fuel supply for the entire nation at E12 or E15, or we can more encourage it to be used more efficiently as E85 in cars designed for that purpose. Because of my concern for peak oil and efficient use of resources, I favor the latter approach.

    RR

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  134. By Rufus on August 22, 2010 at 10:57 pm

    When it comes to taxes I’ve always been “agin’em.” So, I think My preferred solution would be to drop Federal Highway Taxes on E85. If the Feds reimbursed any State taxes, in addition, it would still come out less than giving a blenders credit on the high ethanol fuel. If, at the same time, they did away with the blenders credit I don’t believe I’d lose any sleep.

    I think I heard the other day ( could be high on this) that Iowa produces about 3 Billion gallons/yr of ethanol. If that’s true they could just about run all of their light vehicles on homegrown ethanol, mixed in an E85 blend.

    They’ll probably end up getting another two, or three hundred million gallons off corn cobs. Corn would have to get pretty expensive, I think, before much of that “marginal” land goes into corn, and the way “yields” are going, that seems unlikely. They “may” end up doing some miscanthus, or switchgrass on some of that lesser-quality land. I don’t know. It’s kinda far North. I haven’t read where Anyone is projecting more than 4, or 5 tons/acre up there.

    One thing that’s getting overlooked is that something like 90% of your switchgrass/miscanthus plant is “underground.” Also, you harvest these crops late in the fall after it’s died, and all of the nutrients have drained back into the roots. About all you’re getting, literally, is lignin, and cellulose. That’s why you only fertilize it a bit the first couple of years, and don’t have to, thereafter. It’s just “recycling” the same nutrients “up, and down.”

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  135. By rrapier on August 22, 2010 at 11:59 pm

    So, I think My preferred solution would be to drop Federal Highway Taxes on E85.

    That’s actually one of the things I was thinking about proposing in my Iowa post. I am just trying to understand how E85 is currently taxed, and therefore how much that would amount to. I think what you need to generate a fast-growing market is a delta that is consistently > 30% in price between gasoline and E85.

    RR

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  136. By Rufus on August 23, 2010 at 1:33 am

    That would surely help, although, I’m afraid that you, also, need gasoline in the $3.00 range (a lot of anecdotal evidence suggests that the American Consumer just doesn’t get very interested until gasoline gets somewhere around this point.)

    Now, you could accomplish this with an increase of $0.30 or so in the Federal gas tax, but there’s not a chance in Hades that you will ever find 60 Senators that will go along with it. Especially Now.

    The “news” (hard to characterize it as good – unless you’re in the ethanol/batteries bidness) is that the oil market is probably going to do the work for us, fairly soon. From the study I’ve done it’s just hard to believe that gasoline isn’t going to be in the $3.00 + range by late Spring, or Summer. There’s a lot of Chinese Geometry in the oil markets, but I’d “almost” bet money on that outcome.

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  137. By ronald-steenblik on August 23, 2010 at 2:11 am

    What is interesting in your idea to eliminate the federal fuel-excise tax on E85 is that it turns the recent policy trend (from direct tax exemptions to indirect (blender) tax credits to producer tax credits) back to the period before the gasohol excise-tax exemption was converted to the VEETC. Excise-tax reductions, exemptions and rebates are what are still used in Australia, the EU and Switzerland to support biofuels. (Canada ended tax exemptions and switched to declining production incentives a couple of years ago.)

    One point I have made numerous times is that simply exempting a biofuel from a fuel-excise tax is about as arbitrary a basis for an economic incentive as one can get. In some European countries, the value of the tax exemption has been over $2 per gallon. In others it has been less than $0.50 per gallon. Exemption from the U.S. federal gasoline excise tax would be worth $0.184 per gallon. Clearly, the countries that have given such widely different excise-tax exemptions for ethanol can’t all, simultaneously, have set the incentive at an optimal level.

    Robert, when writing your next blog, please give some thought to what you are advocating: basically, putting the micro-management of a highly volatile market in the hands of a legislative body, especially a legislative body with highly differentiated regional interests in the outcome of the exercise. This is a market affected by all manner of uncertainties: the absolute price of corn, the price of corn relative to other crops that can be grown on the same land, the price of gasoline, the price of natural gas, the prices of chemical inputs, and, of course, the weather. One can either regulate the volumes sold (and let the price vary), or one can set a price differential and hope for the best. But in the latter case, the chances of undershooting or overshooting approach 100%, unless you are suggesting the creation of a price-setting board (a sort of Organization of Ethanol Producing Counties) that would meet frequently to adjust the amount of the tax exemption.

    The problem with overshooting is that it creates “rents” (basically, windfall profits) in the system. And, as explained above, those rents tend to get capitalized into the value of farmland. As farms get sold, that high price gets locked in, as few politicians are brave enough to pull the plug on a long-running subsidy that will precipitate distressed farm sales.

    There is also the issue of what economists call “moral hazard”. The reason for the current excess supply can be laid firmly on over-generous support and stoked expectations. Coming in with yet more government support sends a message that government will always be there to come to the industry’s rescue, thus reducing down-side risks and encouraging yet more investment.

    Finally, think about the aspect of equity. If your proposal results in a big surge in excise-tax-free E85 consumed in the Midwest, it will mean that, effectively, the rest of the country will be subsidizing Midwest federal highways, as the purpose of the federal gasoline and diesel excise taxes is to raise revenues for the Highway Trust Fund. Of course, if individual Midwest states choose to exempt E85 from their own state gasoline excise taxes (on average, nationwide, around $0.145 per gallon), that’s their problem to sort out. (Likely, they would have to raise their excise taxes on gasoline and petroleum diesel to make up for the revenue shortfall.) 

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  138. By fred-schumacher on August 23, 2010 at 7:10 am

    One of the reasons Miscanthus giganteus has such high yields is that it is a sterile hybrid of M. sinensis and M. sachariflorus. The sterility is important. It allows the plant to invest totally in vegetative growth and skip the energy draining sexual reproduction stage. It also allows the plant to translocate more nutrients into its root system, increasing the quantity of sequestered carbon (in trials at the University of Illinois  Urbana-Champaign, that amounts to about 4 tons/acre/year).

    It is possible to achieve phenological sterility with switchgrass (Panicum virgatum) by taking a southern cultivar and moving it far north. This is possible with switchgrass because it has high winter tolerance. Normally, a native plant should not be moved 300 miles north or 200 miles south of its latitude of origin, but Blackwell switchgrass, originating in Oklahoma, has been grown successfully in northwestern North Dakota. REAP-Canada, in biomass yield trials in Quebec, has found the highest yields come from the Cave-in-Rock cultivar, which originated from collections taken from southernmost Illinois.

    Perennial grass phenology is 95% correlated with growing-degree days. It is total accumulated heat units that determine the plant’s life stages. (Grass phenology, acting as a low-pass filter, can be used to track climate change.) However, vegetative growth rate is strongly impacted by day length. The upshot is that, by taking a southern cultivar and moving it far north, biomass yields can be greatly increased. The advantage that switchgrass has over M. giganteus is that it can be planted from seed and also has better characteristics for wildlife benefits. Both of these grasses are C4 photosynthesis pathway plants, as is corn, a C4 annual grass.

    The advantage to a farmer of growing a perennial biomass crop is the reduction in variable annual costs and management: seed, fertilizer, chemicals, cultural operations, machinery costs, interest on operating loans, hours of work. It’s the net income, not gross, that counts. If net income can be increased, combined with a reduction in capital investment, farmers will be very interested in moving away from corn/beans to biomass crops.

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  139. By Rufus on August 23, 2010 at 9:14 am

    As long as gasoline demand stays at 9.5. Million Barrels/day there will be no “overproduction” of ethanol. We’re on schedule to top out at about 945,000 barrels/day, slightly below 10% of total E10 sales.

    If gasoline sales do drop below the magic 9.5 mbpd number it probably wouldn’t be the end of the Republic, inasmuch as U.S. Corn ethanol is the most competitive ethanol on the World Market, and since Global demand seems to be looking up.

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  140. By Kit P on August 23, 2010 at 9:42 am

    I

    “but I doubt corn ethanol for
    California will be. I don’t believe the energy density will warrant
    shipping ethanol halfway across the country for California’s cars.”

     

    California has a large AG industry.

     

    “I don’t know.”

     

    Yet RR continues to comment on what he
    does not know about.

     

    When and if RR ever produces ethanol he
    should hire someone to ensure that his process makes the soil less
    marginal.

     

    “I favor the latter approach.”

     

    I do not see any problem with doing
    both.

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  141. By Kit P on August 23, 2010 at 9:48 am

    Fred, thanks for the interesting post.
    It would appear that farmers and universities in the midwest are
    working on ways to reduce the environmental impact producing energy
    crops.

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  142. By rrapier on August 23, 2010 at 2:59 pm

    Time-Waster Kit P said:

    “I don’t know.”

     

    Yet RR continues to comment on what he does not know about.


    Nice out of context quote, Kit. I said I don’t know whether we are past the point of sustainable corn production. Unlike you, I can say “I don’t know” if I am uncertain of something. You, on the other hand, would pretend that you did know and spew a lot of nonsense, attempt to defend it, insult the person you are talking to, and never admit that you really didn’t know. Complete waste of time.

    Besides, if the need to know something with certainty was a criteria for being able to speak in this forum, that would eliminate the vast majority of your posts.

     

    RR

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  143. By rrapier on August 23, 2010 at 3:03 pm

    Ronald Steenblik said:

    Robert, when writing your next blog, please give some thought to what you are advocating: basically, putting the micro-management of a highly volatile market in the hands of a legislative body, especially a legislative body with highly differentiated regional interests in the outcome of the exercise.


     

    Ron, the issue is already in the hands of the legislative body. That body gave us the RFS, and that body will continue to ensure that we are producing 15 billion (or more) gallons of ethanol per year. So what I would propose is to modify the way that ethanol is used such that it is more efficient than under present law.

    The way I am going to approach this is to suggest different ways to reach the goal.

    RR

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  144. By ronald-steenblik on August 23, 2010 at 4:35 pm

    Ron, the issue is already in the hands of the legislative body. That body gave us the RFS, and that body will continue to ensure that we are producing 15 billion (or more) gallons of ethanol per year.

    Yes, of course. But there is at least a chance that the blenders tax credits will expire in a few months. (Rufus seems to think that is almost a certainty.)

     

    [link]      
  145. By Kit P on August 23, 2010 at 4:58 pm

    Anti-nukes like to list all their concerns and then say we should not make electricity with because there are too many unanswered questions.  Of course these questions have been addressed thousands of times.  I am not concerned because I do know the answer.

     

    RR writes,

     

    “I am also seriously concerned about ..”

     

    The reason I am not concerned about soil erosion or dead zone is that I know it is not a problem with respect to ethanol.    

     

    “There are always trade-offs.”

     

    No actually, there does not have to be.  We can make electricity without compromising safety.  We can make ethanol with negatively impacting the environment.  I know we can produce corn and reduce wind and water erosion of soil.

     

    What do the farmers and agronomists tell me about the economics of good farming practices tell me as we walk their fields?  It increases profitability by raising yields and reducing inputs.

    [link]      
  146. By rrapier on August 23, 2010 at 5:50 pm

    Kit P said:

    The reason I am not concerned about soil erosion or dead zone is that I know it is not a problem with respect to ethanol.    


     

    No, you don’t. Or perhaps you would like to share with us your expertise that allows you to make such a statement. Corn is known to be one of the most erosive crops, and the dead zone has in fact grown as we have ramped up ethanol production. So your comments have no basis. You don’t know, but here is a case where you insist that you do.

    “There are always trade-offs.”

     

    No actually, there does not have to be.  We can make electricity

    without compromising safety.  We can make ethanol with negatively

    impacting the environment.  I know we can produce corn and reduce wind

    and water erosion of soil.

    You say there does not have to be trade offs, but experience argues otherwise. There are multiple trade-offs that we have made as we ramped up ethanol production. You may be completely unaware of them (i.e., you don’t know) but they are there nonetheless. There is no free lunch; we just need to make sure we understand the trade-offs.

    RR

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  147. By rrapier on August 23, 2010 at 7:49 pm

    Kit P said:

    “I don’t know.”

     

    Yet RR continues to comment on what he does not know about.

     

    When and if RR ever produces ethanol he should hire someone to ensure that his process makes the soil less marginal.


     

    By the way, the irony in those two comments is too rich to pass up. If someone asked Kit exactly I do and what I produce, he would have to say “I don’t know.” Yet that has never stopped him from commenting on what he does not know about. I guess concepts like irony and hypocrisy are completely lost on Kit.

    RR

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  148. By Rufus on August 23, 2010 at 9:41 pm

    actually, Kit is right on this one. If you go back to 1995 there is exactly “Zero” Correlation between corn plantings and the size of the hypoxia zone. Zero.

    The same, obviously, goes for ethanol produced, and the hypoxia zone.

    Since I’m not signed in, and can’t post urls, I’ll just say go to corncommentary blog, and go back a few articles (to the second page,) and you’ll see the numbers.

    For fifteen years the hypoxia zone has “waxed,” and “waned” in what appears to be a totally random, and unpredictable manner, while corn, and ethanol production has steadily increased.

    [link]      
  149. By Rufus on August 23, 2010 at 9:42 pm

    I will attempt a url and see what happens.

    http://corncommentary.com/2010…..ationship/

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  150. By rrapier on August 23, 2010 at 10:10 pm

    Be that as it may (and before I accepted that I would want to go to the original source and look at historical corn plantings versus the dead zone; I can envision that a corn blog would attempt to put the best possible face on the numbers) — it is true that the source of the dead zone is nitrogen runoff, largely due to corn:

    http://www.msnbc.msn.com/id/23695288/

    Previous research has shown that corn, one of the three staple crops
    grown on U.S. croplands, accounts for the bulk of the nitrogen pollution
    that fuels the dead zone, said study leader Simon Donner of the
    University of British Columbia.

    RR

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  151. By Kit P on August 23, 2010 at 10:14 pm

    “and the dead zone has in fact grown
    as we have ramped up ethanol production.”

     

    What RR means is that dead zones are
    projected to increase if we do they are we did in the past.

     

    As an environmental engineer, this
    suggests that dead zone existed before we ramped up ethanol
    production. In fact, dead zone existed before the invention of
    synthetic fertilizer. In fact, dead zone are natural.

     

    So how much are dead zones are natural
    and how much caused man?

     

    Clearly dead zones were the result of
    practices before 1970 and the CWA. Before ethanol.

     

    One of the reasons I went to grad school
    for environmental engineering is a belief that we can address the
    root cause of environmental problems and still enjoy modern life.

     

    So no that is not hypocrisy (which is a
    personal attack BTW) but a belief that we do not have to accept
    trade-off or what every lame platitude RR want to use. Furthermore,
    it is clear that a systematic approach to solving environmental
    problems works.

     

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  152. By Kit P on August 23, 2010 at 10:40 pm

    “actually, Kit is right on this one.”

     

    When it comes to energy and the
    environment, I am awesome. I do not mind being wrong, I just do not
    have much practice. This does irritate folks so I stopped telling
    them Latin, ‘tu est falsus’.

     

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  153. By rrapier on August 23, 2010 at 10:58 pm

    So no that is not hypocrisy (which is a personal attack BTW)

    What is hypocrisy was what you posted. You wrote “RR continues to comment on what he doesn’t know” and then you turned around and did just that — commented on something you don’t actually know. It is hypocritical, plain and simple.

    RR

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  154. By Rufus on August 23, 2010 at 11:46 pm

    “Simon Whatshisname” can say whatever he wants, but the fact remains, “No Correlation,” WHATSOEVER, has been established between corn plantings, and the size of the Hypoxia Zone. None. Nada. Zippo.

    If you draw a line through a graph representing the size of the hypoxia zone since 1995 it is a “Horizontal” Line. Dead, Solid, Horizontal.

    Oh, and corn yields are up, probably. 60%, or more.

    [link]      
  155. By Rufus on August 23, 2010 at 11:56 pm

    Actually, the line is sloping downward just a bit.

    The hypoxia zone was about 8,000 sq miles in 2007, and 2008, and dropped to 3.500 sq miles in 2009.

    Meanwhile, corn production “Increased” about 7% from ’08 to ’09. It’s about time to put “this” urban myth to rest.

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  156. By Wendell Mercantile on August 24, 2010 at 12:16 am

    Dead zone in gulf linked to ethanol production

    The gulf dead zone is the second-largest in the world, after one in the Baltic Sea. Scientists say the biggest culprit is industrial-scale corn production. Corn growers are heavy users of both nitrogen and pesticides. Vast monocultures of corn and soybeans, both subsidized by the federal government, have displaced diversified farms and grasslands throughout the Mississippi Basin.

    “The subsidies are driving farmers toward more corn,” said Gene Turner, a zoologist at Louisiana State University. “More nitrate comes off corn fields than it does off of any other crop by far. And nitrogen is driving the formation of the dead zone.”

    The dead zone, he said, is “a symptom of the homogenization of the landscape. We just have a few crops on what used to have all kinds of different vegetation.”

    [link]      
  157. By rrapier on August 24, 2010 at 12:18 am

    Rufus said:

    Actually, the line is sloping downward just a bit.

    The hypoxia zone was about 8,000 sq miles in 2007, and 2008, and dropped to 3.500 sq miles in 2009.

    Meanwhile, corn production “Increased” about 7% from ’08 to ’09. It’s about time to put “this” urban myth to rest.


     

    That is certainly a disconnect between what researchers claim:

    Dead Zone in Gulf Linked to Ethanol Production

    The gulf dead zone is the second-largest in the world, after one in
    the Baltic Sea. Scientists say the biggest culprit is industrial-scale
    corn production. Corn growers are heavy users of both nitrogen and
    pesticides. Vast monocultures of corn and soybeans, both subsidized by
    the federal government, have displaced diversified farms and grasslands
    throughout the Mississippi Basin.

    “The subsidies are driving
    farmers toward more corn,” said Gene Turner, a zoologist at Louisiana
    State University. “More nitrate comes off corn fields than it does off
    of any other crop by far. And nitrogen is driving the formation of the
    dead zone.”

    The dead zone, he said, is “a symptom of the
    homogenization of the landscape. We just have a few crops on what used
    to have all kinds of different vegetation.”

    Now they could be wrong, but enough peer-reviewed studies have been published on this that you can’t handwave it away on the basis of a couple of years of data. We do know that nitrogen is a major factor in creating a dead zone; we understand that mechanism quite well. So I would test the application of nitrogen fertilizer against the dead zone. I would also like to see the raw data. I am sure that a corn blog is interested in objectively reporting the data, but nonetheless I would like to see the raw data from the agencies.

    In fact, this seems like a good topic for a future post. I don’t know what the answer is, but if there is no correlation between the dead zone and corn production I would certainly be interested in posting on that. But it will take some digging. I am not going to make a conclusion based on a corn blog.

    RR

     

    [link]      
  158. By rrapier on August 24, 2010 at 12:21 am

    LOL! Wendell was just a bit faster than I was, but we honed in on the same information.

    RR

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  159. By Wendell Mercantile on August 24, 2010 at 12:23 am

    State authorities say fish kill in St. Bernard Parish waters likely caused by low oxygen levels

    Randy Pausina, head fisheries biologist for the state, said Department of Wildlife and Fisheries workers are investigating the fish kill and that the initial conclusion is that it was caused by low levels of oxygen in the water.

    Pausina said extreme heat can cause areas of low oxygen, especially when coupled with nutrient-rich water coming from the Mississippi River.

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  160. By Rufus on August 24, 2010 at 12:38 am

    All I saw in your, and Wendell’s link was “Words.” “Statements.” “Opinions.”

    I Posted “NUMBERS.”

    Pure, simple “Numbers.” The Size of the Zone vs Corn Production.

    The “Numbers” are fairly easy to “Look Up.” I suggest you both Do That.

    [link]      
  161. By Rufus on August 24, 2010 at 12:43 am

    Okay, I typed in “size of the hypoxia zone” on yahoo, and the first link was USGS.

    The Exact Same Graph.

    [link]      
  162. By rrapier on August 24, 2010 at 12:58 am

    Rufus said:

    Okay, I typed in “size of the hypoxia zone” on yahoo, and the first link was USGS.

    The Exact Same Graph.


     

    Only problem is that is isn’t the exact same graph:

    http://toxics.usgs.gov/hypoxia….._zone.html

    In fact, that graph directly refutes the argument you are making by showing that the average for the past 5 years is almost 1,000 square miles larger than the long-term average, and double the size of the late 1980′s. Kind of what I expected to see, especially given all of the peer-reviewed literature on this. So your “no correlation” argument kind of falls apart on the basis of that graph.

    RR

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  163. By rrapier on August 24, 2010 at 1:07 am

    The Dead Zone in the GOM

    Graph from Corn Commentary

    These are the graphs the Rufus claims are “The Exact Same Graph.”

     

    RR

    [link]      
  164. By Rufus on August 24, 2010 at 1:54 am

    Fine, why not take 1993 to 1997? That comes out about 7,000 sq miles “Greater” than the last 5 years.

    Yes, the USGS graph goes back a few more years, But, if you’ll look closely, it also has a slight downslope to it. And, Corn yields have skyrocketed during this time.

    [link]      
  165. By Rufus on August 24, 2010 at 1:59 am

    Oops, that should have been “700 sq miles Greater.)

    And, I guess, being “average sq miles” that line is flat. I was just imagining the slight drop on yours.

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  166. By Rufus on August 24, 2010 at 2:13 am

    The bottom line is, sure, the area of the hypoxic zone bounces around, a lot, but the correlation to corn production just isn’t there.

    Is it caused by nitrogen, and phosphorous, and potassium washing to the sea? Yeah. Just like the one at the mouth of the Amazon (you know, the river that runs through 4,000 miles of Rain Forest.)

    That’s what Rivers do. They wash topsoil to the sea. That’s why the American Indians called it the “Big Muddy River.” It was washing vast amounts of dirt to the sea. Now, it, also, picks up vast amount of effuent from American Citie (Chicago is suspected of contributing 5% of the NPK to the “Dead Zone.” How much does Jefferson City, St. Joe, Milwaukee, Evansville, Cincinnatti, Louisville, Memphis, New Orleans, and Baton Rouge, plus the hundreds of smaller towns contribute? How much sewage? How many fertilized lawns, and washed cars?

    How about the Millions of Cattle, and hogs from Iowa, Missouri, Illinois, Ohio, Arkansas, Mississippi, and other states whose waterways wash into the river? What about the Mississippi Delta Cotton, and Soy beans?

    Does this All play a part? Of course. Singling out one? Goofy.

    [link]      
  167. By ronald-steenblik on August 24, 2010 at 3:15 am

    Singling out one? Goofy.

    Not if one is talking about the marginal effect of increasing the contrubution from any one of the sources. One could talk about the marginal effect of, for example, 1 million more people moving into the Mississippi river catchment area. One can also talk about the marginal effect of increasing corn production. The effects will depend on numerous variable, including sewage treatment practices (in the case of people), and the extent to which the increased corn production came from plowing up grasslands or from displacing other crops, the particular cultivars used, and how the corn has been grown, including fertilizing practices. (I know I’m not telling you anything you didn’t know already, Rufus.) The point is, it is not goofy to talk about marginal effects from policy decisions. 

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  168. By Rufus on August 24, 2010 at 3:37 am

    Ron, until someone can explain to us why the hypoxic zone went from 8,000 sq miles in 2008 to 3,000 sq miles in 2009 (and, why it was only 1,700 sq miles in 2000) I’ll have to say blaming corn for the hypoxic zone is “goofy.”

    BTW, 2009 had the Largest Crop, and the Highest Yield of any year on record.

    [link]      
  169. By ronald-steenblik on August 24, 2010 at 5:00 am

    For what it is worth, here’s an abstract of an article that has been accepted for publication in Energy Economics, “<a href=”http://www.sciencedirect.com/s…..e2abd6ce70“>On the Economic Sustainability of Ethanol E85</a>”, by Shaun W. Tatum, Sarah J. Skinner, John D. Jackson, all of the Department of Economics, Auburn University, Auburn, AL:

    Several studies have considered the sustainability of corn-based ethanol as produced in the US as a major fuel source from a technical perspective. However, not much attention has been paid to the market-based aspects of corn-based ethanol as a sustainable fuel. We address this question by offering an econometric analysis of the E85 (apparently the most viable of the potential substitutes for gasoline) market using demand and supply analysis. Reduced form price equation estimates indicate that the cross elasticity of E85′s price with respect to the price of gasoline does not differ significantly from unity, so that any rise in gasoline prices will be matched (in percentage terms) by a corresponding rise in the price of E85. Thus, given the current market, which includes significant government subsidy, the prospect that E85 will ever be price competitive with gasoline is indeed dim.

    The authors are, of course, talking about long-run trends, not short-term perturbations. And they conclude:

    Of course, it is always possible that consumption technologies can change for political, as well as economic reasons. And production technologies can change as government encourages more production of E85. But any favorable changes that do occur would have to be rather substantial just to overcome the price differential due to the subsidy. At the minimum, our results suggest that policy makers take a long and hard look at economic sustainability issues before continuing their headlong plunge into promoting bio-fuels as substitutes for petroleum based energy sources.

     

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  170. By paul-n on August 24, 2010 at 5:27 am

    Rufus said;

    Ron, until someone can explain to us why the hypoxic zone went from 8,000 sq miles in 2008 to 3,000 sq miles in 2009 (and, why it was only 1,700 sq miles in 2000) I’ll have to say blaming corn for the hypoxic zone is “goofy.”

     

    I wanted to explain this to you, but found out the USGS has already done so.  

    The USGS has a good report here and here about nitrogen and river flow rates.

    The correlation is not just with corn, and nitrogen fertiliser, but also with streamflow.   Quite simply, the greater the flow, the more stuff (dissolved salts and sediment) the river carries.   This is especially true in flood events, where there is significant soil erosion, (when you see muddy water flowing).

     From this report;

     

    One of the principal causes for the increasing size of the hypoxic zone is believed to be the increasing supply of nitrogen, particularly nitrate, delivered to the Gulf each year from the Mississippi River Basin. Nitrate concentrations have increased several fold during the past 100 years in streams draining some parts of the Mississippi Basin, and the annual delivery of nitrate from the Mississippi River to the Gulf has nearly tripled since the late 1950′s

    Now, the flow of nitrogen is a product of the amount of nitrogen in the soil, and the amount of precipitation/streamflow.  We’ll assume that the streamflow hasn’t tripled since the 50,s  an infact, the data show that, though variable, the streamflow is about the same now as it was then.

    Goolsby and others (1999) estimated the annual nitrogen inputs, removal, and residuals for the Mississippi Basin for 1955-96. These variables and a number of related variables, which could be quantified through this time period including those in figure 5, were examined in statistical models to determine which ones could best explain the observed annual nitrate flux to the Gulf. The three most statistically significant variables were, in order of importance, annual basinwide nitrogen fertilizer use 2 years previous, mean annual streamflow for the current year, and the basinwide residual nitrogen for the previous year. The regression model shown below has an R² of 0.89.

    They even knew this was going to be quoted in the R squared blog!  In fact this stuff is so good, I might as well post the rest of it;

    Nflux = 0.049*F2 + 36*Q – 0.094*R1,

     

    (1) 

    where Nflux is nitrate flux to the Gulf, in metric tons per year; 

    where F2 is fertilizer use in the entire basin 2 years previous, in metric tons; 

    where Q is the current year mean annual discharge to the Gulf, in cubic meters per second; 

    where R1 is the nitrogen residual for the previous year, in metric tons.

    A comparison of the nitrate flux predicted from the regression model and the observed nitrate flux (see annual flux in fig. 4) is shown in figure 7.

    F2 explains about 68 percent of the variation in nitrate flux and explains much of the increasing trend in nitrogen flux. Q explains an additional 18 percent of the variation in nitrogen flux and explains much of the observed year-to-year variability. R1 explains another 3 percent of the variation in nitrogen flux. For most years, except 1972-74, the model shows excellent agreement between observed and predicted values. Streamflow was very high during these 3 years (see fig. 4), and nitrate flux is greatly over predicted. Results for 1961 are similar, although streamflow was considerably lower. Little excess nitrate may have been present in the soil/ground-water system for leaching during these periods.

    The observed fluxes indicate that the nitrate transport to the Gulf has not increased appreciably since the early 1980′s. However, the year-to-year variability has become large, probably because of variability in precipitation and an abundant reservoir of soluble nitrate in the soil/ground-water system. Thus, nitrate inputs to the Gulf appear to have stabilized for the current level of nitrogen inputs and outputs. However, in future years the flux of nitrate to the Gulf will likely respond quickly and perhaps dramatically to variations in precipitation and runoff. Because of the amount of nitrate stored in the soil/ground-water system, fluxes of nitrate will be low in dry years and high in wet years. Also, because of the huge storage capacity of the soil/ground-water system, the flux of nitrate will likely change very slowly in response to increases or decreases in nitrogen inputs to the basin

    So, they are saying annual variations will likely be because of flow variations, and trends for fertiliser take years, or decades to show up, but are definitely there, and 68% of the nitroigen that ciasues the hypoxia is from fertiliser.  

    Now lets look at their graphs

     I have reproduced their Figure 4 here;

    and from another USGS report, a more recent series, with the “Rufus Minimum” in 2000;

     

    You can see 2000 was a very low flow year, so the nitrogen transport was reduced,as was, of course, the hypoxia zone.

    Does this answer your question Rufus? 

    and figure 5;

    showing the dramatic increase in nitrogen usage, correlating with the increase in nitrogen transport, and the appearance of the hypoxia zone

    and, to pull it all together, look at their model prediction in figure 7;

    I would call that a pretty damn good prediction.

    I would suggest that nitrogen looks to be the cuplrit.  So to solve the hypoxia problem, one of three things needs to happen;

    1. it stops raining and the river stops flowing (= no transport), or 
    2. we take all the water out of the river (=no transport)
    3. the farmers stop using nitrogen (=nothing to transport)

    I can’t see (1) happening, but 2 and 3 are possible, though both will be mighty unpopular

    So the problem is not directly ethanol, it is not even corn, it is just nitrogen fertiliser.

    so as long as the corn farmers are not using nitrogen, then Rufus is right, and blaming them is goofy.  But, if the corn farmers are using nitrogen to grow their corn, then blaming them appears to be entirely appropriate, regardless of whether they turn the corn into ethanol or not.

    And while the ethanol producers that pointed the finger at BP for “destroying the Gulf” might just want to take a look in the mirror themselves – by using nitrogen fertilised corn,  they are doing the Gulf no favours.

     

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  171. By ronald-steenblik on August 24, 2010 at 5:50 am

    Bravo, Paul. A tour de force.

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  172. By Rufus on August 24, 2010 at 6:39 am

    Sorry, Paul, but it was, simply, a tour de conjectures, maybes, could bes, and might bes, with some squiggly lines that might or might not have meant anything.

    The FACT is: in the year of our Lord 2009, after two very wet years in the Midwest, the size of the Hypoxic Zone dropped from 8,000 Sq Miles to 3,000 sq miles.

    Also, these “researchers” didn’t mention “phosphates,” once. And, phosphates are probably just as important as Nitrates.

    They “cherry-picked” a few dates, but the fact is: Draw a straight line through the data from 1995 through 2009, and you get a slightly declining line.

    The fact is, Paul, no one has a clue. Some years the algae grow, and some years the algae does whatever it is algae does when it’s not growing.

    All I know is no one was paying much attention to it when the taxpayers were paying the corn farmers $1.00 bushel to raise corn, and sell it for A Dollar a Bushel under the market price to cattle ranchers, and Exporters.

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  173. By Rufus on August 24, 2010 at 6:56 am

    A Hypoxic Zone appeared off the coast of Oregon in 2002, and has been there every summer ever since. They don’t have a clue, “Why.”

    A change in Ocean Currents? Upwelling? They don’t know. It’s just there.

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  174. By Rufus on August 24, 2010 at 6:56 am
    [link]      
  175. By Rufus on August 24, 2010 at 7:11 am

    Here, if the spam filter doesn’t kick it out you can educate yourself on what a hypoxic zone really is. Hint: it’s Not a “dead zone.” Not the way you’re thinking about it, anyway.

    http://www.epa.gov/owow_keep/m…..xia101.htm

    [link]      
  176. By Kit P on August 24, 2010 at 8:27 am

    I once saw a 60 MINUTES episode about
    PCB contamination. A scientist in a white lab coat showed a picture of
    a bunch of dead fish and ‘linked’ it to the fish kill. PCB killing
    fish is what many would ‘expect’ because that is what they have been
    told.

     

    However, PualN (I hope) would look at
    the dead fish and think hypoxia was the likely cause because although
    PCBs sound like a scary chemical it is really very benign.

     

    So what is the solution to a
    insignificant problem? Ban the the man made ‘scary’ sounding
    chimical that is used to improve safety where KitP works.

     

    “I would suggest that nitrogen looks
    to be the cuplrit. So to solve the hypoxia problem, one of three
    things needs to happen;”

     

    I agree with PualN so far.

     

    “the farmers stop using nitrogen”

     

    This is where I think Pual N is a
    really lousy environmental engineer. All that training gone to waste if you draw the wrong conclusion and do not fix the problem.

     

    “Bravo, Paul. A tour de force.”

     

    And how would you know Ron? If you
    look at Ron’s resume, Ron should know better.

     

    So what is your solution PaulN, RR,
    Wendell, and Ron? Throw up your hands, yell ‘ain’t it awful’ and
    move back into your cave?

     

    No of course not! When I was in grad
    school, there was a chemical processing facility in town that was the
    second worst polluter in the county with various nitrogen compounds.
    Now it has it has no releases and the plant recycles the nitrogen compounds
    into fertilizer.

     

    PaulN, RR, Wendell, and Ron are
    unwilling to give up a modern life, I suggest we address the root
    cause of the problem and work toward sustainability. Of course
    sustainability, is reaching an environment that deviates
    insignificantly from nature.

     

    Since corn has proven to be a good
    source of transportation fuel and food, lots of research is being
    preformed to reduce the environmental impact of that activity.

     

    “mighty unpopular”

     

    PaulN gets the understatement of year
    award. Letting billions die of starvation is only advocated by a few
    extremists.

     

    So using fertilizer to primarily grow
    food while retrieving the excess energy to reduce the environmental
    impact is working out pretty well.

     

    I see a systematic process to achieve
    sustainability. For those of you who link junk science from SF
    media, I can see how you might not see it. Look deeper!

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  177. By Wendell Mercantile on August 24, 2010 at 9:29 am

    How about the Millions of Cattle, and hogs from Iowa, Missouri, Illinois, Ohio, Arkansas, Mississippi, and other states whose waterways wash into the river?

    Rufus~

    And what do those millions of cattle and hogs eat? Answer: Corn. So it comes right back to the same root source.

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  178. By Kit P on August 24, 2010 at 10:34 am

    “Corn. So it comes right back to the
    same root source.”

     

    Well no, CAFO are required to have
    NPDES permits under the CWA. Every CAFO that I have been on recycles
    nutrients. This what makes it feasible AD to be added to recover
    energy.

     

    When you see five cows eating grass in
    a field, what else do you think they do when the wonder down to a
    creek?

     

    How about all the cats, dogs, deer, ect
    that dump in the water shed? What was the environmental impact of 30
    million buffalo thundering across the great plains?

     

    My present watersed not know for either
    corn or biofuels, yet I heard on NRP how it was the cause of
    worsening conditions in Chesapeake Bay.

     

    “In the 1970s, marine dead zones were
    first noted in areas where intensive economic use stimulated
    “first-world” scientific scrutiny: in the U.S. East Coast’s
    Chesapeake Bay,”

     

    So before ethanol there was a problems.
    It also a lot better than it used to be when I was stationed there
    in the 70s.

     

    From WIKI

     

    “and nutrient runoff from chicken
    farms was blamed for the growth”

     

    I have only been on one chicken farms
    and that was in NC and it has an AD so no run off. I checked the
    citation in the WIKI article and found:

     

    “Dead zones are created when rain
    washes nitrogen and phosphorus off farm fields, suburban lawns, and
    other places, spurring the excessive growth of algae. The algae die
    and decompose – sucking the oxygen out of the water.”

     

    The primary point I want to make is
    that there are engineering solutions to industrial scale agriculture
    including energy recovery for the carbon. Second, the issue is
    complex with many contributing causes . To blame the recent
    expansion ethanol industry seems a bit agenda and not science driven.

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  179. By rrapier on August 24, 2010 at 11:44 am

    Kit P said:

    “the farmers stop using nitrogen”

     

    This is where I think Pual N is a really lousy environmental engineer. All that training gone to waste if you draw the wrong conclusion and do not fix the problem.


     

    And this is where Kit shows he is lousy at understanding a hypothetical. I don’t think Paul actually believes that farmers are going to stop using nitrogen. He is merely saying that this would be one of the ways to mitigate the dead zone, albeit one that would have other undesirable trade-offs.

    And how would you know Ron? If you look at Ron’s resume, Ron should know better.

    Remember, Kit, that you don’t like it when people don’t know what they are talking about, yet continue to talk. Ron worked on the environmental problems of agriculture for 10 years (in
    addition to several years on point and not-point-source water-quality
    problems generally). I am sure you know that? No? Well then perhaps you should keep quiet since you don’t know what you are talking about and Ron is actually more qualified to discuss this stuff than you are.

    So what is your solution PaulN, RR, Wendell, and Ron? Throw up your hands, yell ‘ain’t it awful’ and move back into your cave?

    You must be forgetting how this conversation started. I said “There are trade-offs.” You disagreed, insisted that the dead zone was unrelated to ethanol, and now you seem to agree that there are trade-offs. Thanks you for coming around to my point, albeit after being dragged there.

    When I was in grad school,

     

    You never have shared with us why you never graduated, and why you don’t have a job as an actual engineer.

    RR

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  180. By rrapier on August 24, 2010 at 11:55 am

    Rufus said:

    A Hypoxic Zone appeared off the coast of Oregon in 2002, and has been there every summer ever since. They don’t have a clue, “Why.”

    A change in Ocean Currents? Upwelling? They don’t know. It’s just there.


     

    Runoff from the Columbia River? There is a lot of agriculture on that and the Willamette River that feeds into the Pacific.

    RR

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  181. By rrapier on August 24, 2010 at 12:09 pm

    Rufus said:

    Sorry, Paul, but it was, simply, a tour de conjectures, maybes, could bes, and might bes, with some squiggly lines that might or might not have meant anything.

    The FACT is: in the year of our Lord 2009, after two very wet years in the Midwest, the size of the Hypoxic Zone dropped from 8,000 Sq Miles to 3,000 sq miles.


     

    If you read the explanation that Paul posted, that would be expected. I would expect that following a very wet year in which lots of nitrogen fertilizer (including legacy nitrogen) was washed off the land, the next year might not be so bad.

    In fact, all of the data here show that there are many factors that contribute to the dead zone, but one is clearly nitrogen fertilizer. We know that corn is a heavy user of nitrogen fertilizer relative to other crops. So the rationale is clear that more corn would mean a larger zone, and in fact as I pointed out the zone over the past 5 years is some 20% larger than the historical average. A slam dunk? Maybe not, but a very long way from your initial assertions that “there is exactly “Zero” Correlation between corn plantings and the size of the hypoxia zone. Zero.” You asked for data, and you have received data that supports the contention that scientists have been making. Peer-reviewed, not posted on a corn blog and not random musings by people like Kit who are unqualified to make them.

    Back to my original point: There are trade-offs for our energy choices. There is no free lunch, and in the long run we have to decide whether a dead zone is one of those necessary trade-offs, whether there are reasonable mitigation options, or whether there are other energy options with lower impact trade-offs.

    RR

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  182. By paul-n on August 24, 2010 at 12:50 pm

     

     all of the data here show that there are many factors that contribute to the dead zone, but one is clearly nitrogen fertilizer.

    Quite so, there will be many factors related to weather, soil erosion, other (industrial activities) etc.  All of this will change from year to year, but the trend over decades is clear – nitrogen in the river has generally increased with the use of nitrogen fertiliser.  

    In deference to Kit, and as RR mentioned above, yes there is an option (4), which is to find ways to prevent the nitrogen from reaching the river.  It has levelled off in recent decades, which is likely due to improved soil and runoff management.  Rules on discharges from feedlots are one example of such, and (almost) all point source discharges are regulated in some fashion.  But non point source discharges (groundwater flow) are much harder to control.

    The fact that the general trend is (slightly) downwards in the last decades suggests that these efforts have stopped the increase, but are yet to resolve the problem.

    I will maintain that ethanol should not be singled out for blame here – it is the fertiliser intensive farming that produces its feedstock that is, and will continue to be, the main source of nitrogen in the river.  

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  183. By fred-schumacher on August 24, 2010 at 12:50 pm

    In the corn belt, corn is most commonly grown in biannual rotation with soybeans. Soybeans are not normally fertilized with nitrogen, since they are nitrogen fixing plants. Any field used for corn production normally receives no nitrogen fertilizer every other year. Fertilizer, when applied, is normally incorporated, usually by disking or injecting so that it binds to the soil. Liquid manure is usually disked in, but solid manure spread on the surface can end up getting flushed downstream during spring run off. (It turns out Amish farms have a big problem with manure flushing.)

    In the mid 80s, we had a huge shakeout amongst farmers. Those who survived are the best educated, best operators that have ever farmed.  The only way to survive in farming is to keep tight control of your expenses, which include fertilizer. The aim is to spread only the amount that the plants will use up completely during the growing season and no more. The prefered operating protocol is called MEY, Maximum Economic Yield. You determine that yield and then operate accordingly. To achieve that level of control, you combine soil survey data, regular soil testing, and yield data taken in real time from combines equiped with GPS and monitoring equipment. GPS equiped fertilizer spreaders can now custom mix on the fly as they travel through the field. Planters can adjust seeding rates as they travel through varying soil types. What helps farmers increase their profit also helps reduce the dead zone.

    The moldboard plow is nearly dead. Minimum till is the norm and many farmers have moved on to no till. There is less soil erosion per unit of production. Farmers are extremely conscious of the amount of “trash” left on a field, the more the better. Soybeans cause more soil erosion than corn, since they leave less trash on the field. The move to solid seeded Roundup-ready beans has reduced soil erosion, since they leave more trash and there is no cultivation for weed control. The increase in yields has come from increasing per unit yield, not from tearing up grasslands for corn production. Some Conservation Reserve Program fields that had been in permanent cover have gone back into cereal grain production, but in any year that is not a large area.

    As long as we depend on annual plants for food and fiber production and have a large livestock feeder industry, there will be soil erosion and fertilizer flushing. It’s the nature of the beast. Cellulosic biomass production would be a different story. Perennial grasses make soil. There are no better plants for binding soil. Perennial grasses are low fertility, low input plants. At some point, I would hope that biofuels research would provide the breakthroughs for producing food directly from the vegetative parts of perennial grasses and legumes. Then we could finally break free from annual plant agriculture. In the meantime, don’t bite the hand that feeds you.

    fred schumacher

    retired grass seed farmer

     

     

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  184. By paul-n on August 24, 2010 at 12:57 pm

    Hmm;

    • a million tons of nitrogen flushed into the Mississippi every year
    • prolific algae growth

    Sound like an opportunity?

    You would like to think that at least someone in the algae fuel business is looking at this, to see if there is a (controllable) way to grow algae (or other aquatic plants) for biomass.  Grow the plants to remove the nitrogen, and create a biomass feedstock (for something).  Can’t use water hyacinth as it is invasive, but there must be some native aquatic plants (e.g. duckweed) that could do the job.

    Makes more sense than trying to grow algae in plastic bags, etc.

     

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  185. By rrapier on August 24, 2010 at 1:23 pm

    Paul N said:

    I will maintain that ethanol should not be singled out for blame here – it is the fertiliser intensive farming that produces its feedstock that is, and will continue to be, the main source of nitrogen in the river.  


     

    And just to be clear, it isn’t my contention that ethanol is the sole reason for the dead zone. On the other hand, one would be hard-pressed (outside of a corn blog) to argue that it isn’t a contributor. And that was my point: There are trade-offs for all of our energy options. Ethanol is no exception.

    RR

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  186. By rrapier on August 24, 2010 at 1:27 pm

    fred schumacher said:

    In the corn belt, corn is most commonly grown in biannual rotation with soybeans. Soybeans are not normally fertilized with nitrogen, since they are nitrogen fixing plants. Any field used for corn production normally receives no nitrogen fertilizer every other year.

    fred schumacher

    retired grass seed farmer


     

    But Fred, hasn’t there been an increased trend of planting corn year after year due to higher demand and using fertilizer instead of the soybean rotation? I know that I have seen fields planted in corn for several seasons in a row as corn prices climbed.

    However, I do agree that there has been a lot of improvements in farming practices. That is what my goal is: Not to kill off ethanol, but to see it produced in a way that is long-term sustainable. Some of the former farming practices were not sustainable.

    RR

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  187. By Wendell Mercantile on August 24, 2010 at 1:49 pm

    In the corn belt, corn is most commonly grown in biannual rotation with soybeans. Soybeans are not normally fertilized with nitrogen, since they are nitrogen fixing plants. Any field used for corn production normally receives no nitrogen fertilizer every other year.

    Fred~

    Not in my part of the Corn Belt — crop rotation here seems to be “old school.” I’ve seen corn fields hat have been planted corn-on-corn for the last five or six years. That has to stress the tilth of the soil.

    I can only assume that some corn farmers desire to maximize profit from corn by dumping on nitrogen made them think short term and say, “The hell with soil tilth, chemicals will pull me out.”

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  188. By paul-n on August 24, 2010 at 2:29 pm

    RR said;

    hasn’t there been an increased trend of planting corn year after year due to higher demand and using fertilizer instead of the soybean rotation?

    This may be true, but there is some data from the USDA that shows fertiliser use is fairly consistent;

    There were some variations from state to state, but none showed an increasing trend.  This data is only to 2005, so things may have changed as corn and ethanol prices increase in 07-08

     

    Also worth a look is the total fertiliser use, by nutrient;

    Clearly, a large increase in total nitrogen, which, since N/acre is static, suggests more acres being cropped, or at least, fertilised

     

    And the most interesting graph of all, is one where they have some price information, for both crops and fertiliser;

    Amazingly lock-step progress until about 2000.  The fertiliser index is for both Nitrogen and Phosphorous, and the crop index is for “all crops”, but N dominates the first, and I suspect Corn is the largest component of the crop index.

    In any case, if the trend of the last decade keeps up, the farmers will have a real problem on their hands, and we may see nitrogen use decrease simply because of price.

    Nitrogen (as ammonia) is made from natural gas, and NG is also the  main input into distillation.  Even though both of these are minority components of total natural gas consumption, they are both competing for the same resource – the more distilleries expand, and use NG, the more upward pressure on nitrogen prices!   It would seem to be in the farmers best interests to get these distilleries burning biomass as soon as possible.

    It is also in their interests to, as Fred has pointed out, maximise their efficiency of usage, and minimise their wastage of nitrogen.  Given that yields have increased for the last decade, and N/acre is stable, this is clearly happening.  

    It will be interesting then to see what happens to N levels in the Mississippi over the next few years/decade, hopefully the slight decrease can become a larger one.

     

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  189. By fred schumacher on August 24, 2010 at 6:23 pm

    The necessity of crop rotation is one of the oldest lessons of agriculture. Most farmers try to stay with a rotation, some don’t. Six years of the same crop on the same field is begging for serious trouble. Our renter is planting beans on beans this year but he admitted to me he hoped it wouldn’t cause problems.

    The graphs posted by Paul show that fertilizer use has been quite flat while production has gone up. Think of it in terms of the development of the coal-fired steam engine from single-expansion to double-expansion to triple-expansion and turbine. Same fuel use producing more usable power. The problem is that steam engine is still burning coal.

    For agriculture, the problem is the use of annuals, which are disturbance plants requiring high fertility. Corn happens to be an especially efficient one, producing more seed on less input than just about any crop, and that’s why it’s so popular. But we’re pushing the limits of photosynthesis and fertilizer and water utilization efficiency in annual plants. We need a paradigm shift to perennials, which I hope biofuels research will provide.

    As regards our original topic of ethanol and its use, ethanol is simply value added processing of a raw agricultural commodity. Run corn through a pig or through an ethanol plant and it’s essentially the same thing: value added processing. The ethanol plant, however, is a two-for (or at least a one and a half-for) since the distillers grains byproduct is in itself a valuable commodity. Ethanol is one of the few developments of the last half century that has given an economic boost to rural America. The infrastructure is not there, however, to use up all the Midwest’s ethanol in the Midwest itself, even with the encouragement of additional subsidies. Minnesota will be moving to a mandated E20 mix, if the Feds allow it, and we’ll see how that plays out.

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  190. By Kit P on August 24, 2010 at 8:45 pm

    “Runoff from the Columbia River?
    There is a lot of agriculture on that and the Willamette River that
    feeds into the Pacific.”

     

    There are a lot of things going on in
    the Columbia River watershed. One of the not trade-off is
    agriculture. Since widespread agriculture is relatively new, you can
    still talk to people who remember what the environment was before
    irrigation. A natural dust bowl.

     

    Yes there are some zones of mono
    culture crops replacing the invasive weeds brought be Russian fur
    trappers. Visit a popular winery or tour an popular land preserve.
    It depends on what you like.

     

    So is corn ethanol causing a
    significant environmental impact including the dead zone off the
    Oregon. Well not yet and if ethanol becomes source of income for
    rural farmers we can sure bet that future dead zones will be blamed
    as a trade-off that is too insignificant to detect.

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  191. By paul-n on August 24, 2010 at 9:00 pm

    Fred, great analogy with the steam engine.

    Transitioning to perennials would be great, though clearly has some challenges.  An annual must produce some seed/fruit if it is to continue the species, whereas perennials have the option to wait until next year if they don’t like the current season.  So small changes in weather patterns can make big differences, and any orchard/vineyard operator knows.   My plum tree gave 15 gallons of plums last year and this year it is three (three plums, not three gallons).  

    Annuals are generally much more suited to mechanized farming, (great for the machinery companies) and also benefit companies that produce seeds, especially hybrid ones.  So annuals may be better for agribusiness in general, though not necessarily the farmer.

    As for ethanol use in the midwest, I don;t think infrastructure is the limiting factor – it is that there is little demand at present, which simply means the markets have not been developed.  

    • there are many flex fuels not driving on E85
    • conversion can easily be done to many late model vehicles to make them flex fuels
    • diesel engines can be co-fueled on ethanol – there are lots of buses, tractors and trains that could run 50% ethanol

    Other options, such as send the ethanol somewhere else, or even export it, are easier, but they are not as effective at displacing oil imports – and that was the original purpose.

     

    If Minnesota is going to “mandate” E20, how then are they getting around the “potential engine damage” issue that always comes up?  

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  192. By Rufus on August 25, 2010 at 12:42 am

    Paul, Brazil ramped to 26% very rapidly, and there was no “engine damage.” That nonsense made a great “scare story” for the anti-ethanol crowd, but there’s never been any evidence that there was anything to it.

    Think about it; it just makes sense. Any fuel system that is “okay” with E10 is going to be just fine with E20. Alcohol is alcohol.

    When Jimmy Carter first came out with his “gasohol” (E10) idea the cars weren’t ready. There were materials in the fuel systems that couldn’t handle ethanol. Those were replaced by, I guess, 1980. A LOT of the cars made since 1990 are, essentially, flexfuels without the designation.

    Keep in mind, a whole lot of what you read is people “talking their own book.” An ex: Ford came out, and said, “E15? Yeah, that’s fine.”

    GM, that has been pushing much harder for E85, and Flexfuels (they sense an edge developing vs the Japs who don’t want to build flexfuels if they can help it,) said, “Oh. lawsy us, we is so scared of E15. We think you should test it, and test it, and test it some more – at least for another 5 years, or so.”

    Everyone’s got an “angle.” We just have to be aware enough to separate out the logical from the not-so-logical.

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  193. By paul-n on August 25, 2010 at 1:46 am

    We just have to be aware enough to separate out the logical from the not-so-logical.

    No argument there, but easier said than done.  The engine damage issue seems a classic straw man that can be used to delay things for years.  That is why I think they should relax the 10% ceiling, since that requires no mandate, and let customers blend whatever they want, at their own risk.  If it’s cheap enough, some people will do so.  Aftermarket kits will be developed.  And those automakers, like Ford, that are ready for it, will get ahead of those like GM that aren;t (or won;t say they are).  

    All that is needed is the freedom to choose, not another mandate.

     

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  194. By Rufus on August 25, 2010 at 2:08 am

    You’re right. But, The Politics (Dollars/Rents) of this are incredibly complex, and convoluted.

    This stuff makes 3-D Chinese Checkers look like the childrens’ card game of War.

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  195. By Charles Powars on August 25, 2010 at 8:07 pm

    $300,000 per E-85 dispenser? From Calif. Energy Commission release:
    “E-85 Dispensers – The Alternative and Renewable Fuel and Vehicle Transportation program is providing $1,000,000 to Propel Fuels, Inc. to add ten new publicly accessible E-85 dispensers that will help create a statewide network of alternative fueling facilities. The dispensers will displace an estimated 3,240,000 gallons of petroleum-based fuels per year, replacing it with low carbon, domestically-produced fuel throughout California. The project participant will provide $2,945,188 in additional funding. E-85 is estimated to reduce greenhouse gas emissions by more than 44 million pounds each year and create or retain over 60 direct and indirect jobs across multiple trades and disciplines.”

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  196. By paul-n on August 26, 2010 at 12:40 am

    Sounds like a “california premium” to me.  My local gas stn owner said new pumps are about $100k apiece.  Keep in mind though, they need to add a separate ethanol storage which does not already exist.

    if they were serious about GHG’s they would just install one station at a fleet location, or a taxi base, etc where the vehicles get driven all day, every day.  This is about having them seen by as many people as possible, which is very Californian.

     

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  197. By Wendell Mercantile on August 26, 2010 at 10:23 am

    Brazil ramped to 26% very rapidly, and there was no “engine damage.” That nonsense made a great “scare story” for the anti-ethanol crowd, but there’s never been any evidence that there was anything to it.

    Rufus~

    If there’s no evidence of engine damage, then why doesn’t the ethanol industry put several million dollars into an escrow account or contingency fund to pay for any damage that might happen?

    There should be no risk to the ethanol industry, yet they could make a positive public relations statement by telling people they are willing to be responsible in the remote chance there is damage.

    It should be a “win-win” for the ethanol industry. According to you there would be no risk, but they would have much to gain in terms of positive PR.

    Why don’t you run that past Bob Dinneen and see what he says?

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  198. By paul-n on August 26, 2010 at 2:03 pm

    Wendell, as much as I agree with the principle of that idea, some people would view that multi million dollar fund  as a fruit ripe for the picking.  There would be no end of spurious claims, an then they would have to sort the real from the fake, and those rejected would accuse them of reneging, etc etc.  It would be easy for an anti-ethanol person (or publicity seeker) to create some engine damage and then create a high profile lawsuit, the media would lap it up about the battler against the ethanol industry, etc etc.  

    Good in principle as the idea is, I think it has the potential to do more harm than good.  They would be better off to fund a series of exhaustive tests and prove their point, such that even the automakers concede it.  That would put out the fire, rather than having to create a fire department to deal with it.

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  199. By Wendell Mercantile on August 26, 2010 at 3:07 pm

    Paul N,

    Actually, I know the ethanol industry would never be so bold as to assure people they stand ready to be accountable for any engine damage higher blends might cause. They’d rather sit and wait for the Government to approve higher blends, so they can then deny any responsibility by saying, “Not our fault. The Government approved it.”

    I also know that human nature being what it is, such a contingency fund would attract all kinds of bottom feeders making false claims hoping to get in on the action.

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